[CURRENT AFFAIRS 2022 GS 3]

JANUARY, 2022
CRUELTY TO ANIMAL
News:
 Dec 2021:
→ Maharashtra government tells Supreme Court that ban on bullock cart races in MH should be lifted because
same is being conducted in Tamil Nadu, Karnataka.
 Dec 2021:
→ Supreme Court allows Maharashtra to hold bullock cart races (400 -year-old tradition) till completion of
pending matter before constitutional Bench of Supreme Court.
 Jan 2022:
→ With steep rise in COVID-19, one district administration in TN bans Jallikattu events, ahead of Pongal
festival, as part of safety measures.
About:
 Initiative:
→ Prevention of Cruelty to Animals Act, 1960:
 It seeks to prevent infliction of unnecessary pain or suffering on animals.
 It established Animal Welfare Board of India (AWBI).
 It provides for punishment for causing unnecessary cruelty and suffering to animals.
 It defines animals and different forms of animals.
 It provides guidelines relating to experimentation on animals for scientific purposes.
→ Prevention of Cruelty to Animals (Care and Maintenance of Case Property Animals) Rules, 2017:
 framed under Prevention of Cruelty to Animals Act, 1960.
 It allows Magistrate to forfeit cattle of owner facing trial under Prevention of Cruelty to Animals Act, 1960.
Animals are then to be sent to hospitals, animal shelters, etc. Authorities can further give such animals for
“adoption”.
Note:
 Maharashtra Bullock cart races:
→ banned in Maharashtra in 2014 after Supreme Court declared it as violative of central act.
→ After Tamil Nadu government enacted law to regulate jallikattu (taming of bull), there was demand to
revive bullock races in Maharashtra.
→ In 2017, Maharashtra assembly passed legislation for resumption of bullock cart races.
→ In 2017, Bombay High Court passed interim order restraining Maharashtra government from giving
permission for bullock cart races.
→ Mh then approached Supreme Court.
 Jallikattu / sallikkattu:
→ What:
 bull-taming sport in TN
 popular in Jallikattu belt (Madurai, Tiruchirappalli, Theni, Pudukkottai, Dindigul districts).
 celebrated during Tamil harvest festival - Pongal.
 tradition over 2,000 years old
 competitive sport, event to honour bull owners who rear them for mating.
 violent sport in which contestants try to tame bull for prize; if they fail, bull owner wins prize.
 traditional event in which bull is released into crowd of people, and multiple human participants attempt to grab
hump on bull's back with both arms and hang on to it while bull attempts to escape.
 Participants hold hump for as long as possible, attempting to bring bull to stop.
 In some cases, participants must ride long enough to remove flags on bull's horns.
 As there were incidents of injury and death associated with this sport, both to participants and to animals forced
into it, animal rights organizations called for ban on this sport, resulting in court banning it. However, with
protests from people against ban, new ordinance was made in 2017 to continue this sport.
→ Importance in Tamil culture:
 Jallikattu is considered traditional way for peasant community to preserve their pure-breed native bulls.
 In today’s time of artificial cattle breeding, conservationists and peasants argue that Jallikattu is way to protect
male animals which are otherwise used only for meat if not for ploughing.
→ Legal battles:
 In 2007, for 1st time, Jallikattu came under legal scrutiny when Animal Welfare Board of India (AWBI) and PETA
(animal rights group) moved Supreme Court against Jallikattu and bullock cart races.
 In 2009, Tamil Nadu worked its way out by passing law / Act.
 In 2011, Centre adds bulls to list of animals whose training and exhibition is prohibited.
 In 2014, Supreme Court bans bull-taming sport.
Page 1 of 719
  In 2017, massive protests erupted across TN against ban (Chennai saw Jallikattu uprising).
 The 2017, TN passed ordinance amending central Act and allowing Jallikattu in TN.
 This 2017 TN amendment was subsequently approved by President of India, effectively overturning 2014
Supreme Court ban and allowing Jallikattu sport.
 Under Article 29, PETA challenged TN State move, arguing it was unconstitutional.
 In 2018, Supreme Court referred Jallikattu case to Constitution Bench, where it is pending now.
Question:
 Animal Welfare Board of India was established in 1962 under Prevention of Cruelty to Animals Act, 1960.
Mains Link:
 Discuss the concerns associated with Bullock Cart races conducted by Maharashtra.

PERSISTENT ORGANIC POLLUTANT (POP) / FOREVER CHEMICAL

News:
 2021:
→ Cabinet approves ratification of 7 chemicals listed under Stockholm Convention on POPs:
 Chlordecone.
 Hexabromobiphenyl.
 Hexabromodiphenyl ether and Heptabromodiphenylether.
 Tetrabromodiphenyl ether and Pentabromodiphenyl ether.
 Pentachlorobenzene.
 Hexabromocyclododecane.
 Hexachlorobutadiene.
 2022:
→ European Commission proposes to tighten limits for many persistent organic pollutants (POPs) to tackle
contamination in recycled products, health, environment.
→ 18 th meeting of POPs Review Committee of Stockholm Convention takes place in Rome, Italy, back-to-back
with 18 th meeting of Chemical Review Committee of Rotterdam Convention.
 Outcome:
• Stockholm Convention 2022 listed ‘Dechlorane Plus’ (flame retardant) and UV-328 (stabilizer) under
Annex A of Stockholm Convention.
• Deferred its consideration of draft risk profile on chlorpyrifos, after members were unable to agree that this
pesticide was likely to lead to adverse effects.
About:
 What:
→ organic compounds resistant to environmental degradation through chemical, biological, photolytic
processes.
→ UNEP defines POP as chemical substance that persist in environment, bio -accumulate through food web,
and pose risk of causing adverse effects to human health and environment.
→ POPs also called “forever chemicals” are organic compounds that are resistant to environmental
degradation through chemical, biological, and photolytic processes.
 Feature:
→ toxic chemicals
→ can be transported by wind and water
 Source / formation:
→ some POPs arise naturally (from volcanoes etc)
→ most POPs are man-made:
 agrochemicals
 industrial chemicals.
 combustion.
 by-products of industrial processes / combustion.
 Example:
→ Pesticides like aldrin, chlordane, DDT (Dichloro -diphenyl-trichloroethane), dieldrin, endrin, heptachlor,
hexachlorobenzene, mirex, toxaphene
→ Industrial chemicals like hexachlorobenzene, PCB (polychlorinated biphenyls)
→ By-products like dioxins, furans.
→ carcinogenic PAH (polycyclic aromatic hydrocarbons)
→ TBT (tributyltin
 Usage:
→ Many POPs are currently or were in past used as pesticides, solvents, pharmaceuticals, industrial
chemicals.
 Impact:
Page 2 of 719
 → adversely affect human health and environment around world.
→ most POPs generated in one country can and do affect people and wildlife far from where they are used
and released.
→ POPs are Lipophilic i.e. accumulate in fatty tissue of living animals and human beings.
→ Magnification of POPs occur i.e. as POPs move up food chain, their concentrations increase, thus animals
at top of food chain - fish, predatory birds, mammals, humans are most affected.
 Countries:
→ USA has taken strong domestic action to reduce emissions of POPs.
 Aarhus Protocol on Persistent Organic Pollutants [1998]:
→ India – not signatory.
 Convention on Long-Range Transboundary Air Pollution (CLRTAP) / Air Convention [1983].
→ This also deals with POPs.
 Stockholm Convention on Persistent Organic Pollutants [2001]:
→ What:
 international environmental treaty to eliminate or restrict production and use of persistent organic pollutants
(POPs).
 legally binding
→ India:
 Benefits for India in ratification:
• India would get benefit in accessing Global Environment Facility (GEF) financial resources in updating
National Implementation Plan (NIP).
Note:
 In 1995, UNEP called for global action to be taken on POP.
 Stockholm Convention on Persistent Organic Pollutants [2001]:
→ One international environmental treaty that aims to eliminate or restrict production and use of persistent
organic pollutants (POPs). One global treaty to protect human health and environment from POPs. It is
legally binding.
→ India - ratified it. In view of this ratification, India notified “Regulation of Persistent Organic Pollutants
Rules, 2018” under Environment (Protection) Act, 1986.
Mains Link:
 Discuss the significance of the Stockholm Convention on POPs.

SECURITY COVER
News:
 Jan 2022:
→ Centre considers action under Special Protection Group Act, 1988 against Punjab Police officers following alleged
breach in security of Prime Minister Narendra Modi during his visit to Punjab.
 Jan 2022:
→ Supreme Court appoints inquiry committee under its former judge Justice Indu Malhotra.
About:
 What:
→ In India, security cover are provided to some high-risk individuals by police and local government.
 Feature:
→ VVIP security is decided by committee [IB officials, home secretary, home minister].
→ Call on central security cover to private individuals in India is taken by Home Ministry based on inputs from
intelligence agencies.
 Classification:
→ Depending on threat perception to person, security category is divided into 6 tiers:
 Special Protection Group (SPG)
 Z+ (highest level)
 Z
 Y+
 Y
 X
 Coverage:
→ President [by President's Bodyguard (PBG)]
→ Vice President
→ Prime Minister
→ Supreme Court judges
→ High Court Judges
→ Service Chiefs of Indian Armed Forces

Page 3 of 719
 → Governors of State
→ Chief Ministers
→ Cabinet Ministers
→ Actors
→ other VIPs.
Note:
 Indu Malhotra committee [2022]:
→ to probe security breach during Prime Minister Narendra Modi’s 2022 visit to Punjab.
→ appointed by Supreme Court
→ will look into who was responsible for security breach and suggest what safeguards are necessary for
security of PM and Constitutional functionaries.
 Special Protection Group Act, 1988 / SPG Act, 1988:
→ SPG Act, 1988 sets protocols for PM’s movement.
→ SPG Act makes State government responsible for providing all assistance to SPG during PM’s movement.
→ Special Protection Group (SPG):
 formed by SPG Act, 1988
 one of Central Armed Police Forces (CAPF)
 PM, former PMs, members of their immediate families
 SPG protects PM at all times both in India and abroad
 Protection of significant VIPs
 Currently only 6 people in India gets it – PM Narendra Modi, former PM Manmohan Singh, former PM Atal Bihari
Vajpayee, Sonia Gandhi, Rahul Gandhi and his sister Priyanka Vadra.

ORGAN TRANSPLANTATION
News:
 2017:
→ Chinese surgeons reportedly transplanted pig cornea to restore sight in human.
 2020:
→ US experts attached genetically-altered kidney to brain-dead person.
 Jan 2022:
→ Surgeons in US transplants pig’s heart inside human patient.
 How:
• Pig was genetically edited:
 by removing 3 genes “that would have led to rejection of its heart organ by human and that would have
led to excessive growth of pig heart tissue”.
 by inserting 6 human genes that would facilitate pig heart organ’s acceptance by human body.
 Why pigs?
• In 1990s, primates fell out of favour because they were susceptible to virus spread. This brought pigs into
picture.
• Pigs are increasingly becoming popular candidates for organ transplantation. This is because Pig’s organs
are anatomically similar to human organs.
• Pigs are easier for genetic engineering.
 Importance:
• remarkable 1st in world of medical science.
• could potentially end years-long backlog of people waiting to receive healthy organ and open up brave new
world of possibilities.
About:
 What:
→ medical procedure in which organ is removed from one body and placed in body of recipient, to rep lace
damaged or missing organ.
→ donor and recipient may be at same location, or organs may be transported from donor site to another
location.
 Example:
→ Heart transplant / cardiac transplant:
 surgical transplant procedure performed on patients with heart failure or severe coronary artery disease when
other medical or surgical treatments have failed.
 most common procedure is to take functioning heart, with or without both lungs, from recently deceased organ
donor (brain death is standard) and implant it into patient. Patient's own heart is either removed and replaced
with donor heart or recipient's diseased heart is left in place to support donor heart.
 Type:
→ Autografts / Autotransplantation:
Page 4 of 719
  Organs and/or tissues that are transplanted within body of same person.
→ Allografts / Allotransplantation:
 Transplants that are performed between 2 subjects of same species.
 Allografts can either be from living or dead source.
→ Syngeneic transplantation / Isotransplantation:
 grafts / transplantation between 2 genetically identical individuals of same species.
→ Xenotransplantation:
 What:
• foreign or strange or heterologous transplant
• transplantation of living cells, tissues, organs from one species to another species.
• Such cells, tissues, organs are called xenografts / xenotransplants.
 Status:
• pursued by modern medical science for decades.
• But, experts have found it difficult because of immune system’s rejection of alien organ, ending in deadly
outcomes for patients.
 Attempts:
• In 1970s, transplantation of Kidney, liver, heart from non-human primates to humans happened. Majority
of them failed.
• In 1984, one human infant received baboon’s heart. She died 21 days after transplant.
• In 1990s, primates fell out of favour because they were susceptible to virus spread. This brought pigs into
picture.
 Issue:
→ Organ rejection:
 One of biggest obstacles to transplantation (our immune system rejects agents that are foreign to our body)
 Scientists are addressing organ rejection problem by genetically altering pigs’ organs.
→ Organ shortage problem:
 In India, patients need 25,000-30,000 liver transplants annually. But only about 1,500 end up receiving them.
 In India, nearly 50,000 persons suffer from heart failures annually. But, only about 10-15 heart transplants are
performed every year.
→ Surgical complications.
 Breakthroughs:
→ In 2017, Chinese surgeons reportedly transplanted pig cornea to restore sight in human.
→ In 2020, US experts attached genetically-altered kidney to brain-dead person.
→ In 2022, Surgeons in US transplanted pig’s heart inside human patient.
Note:
 Heparin:
→ anticoagulant (medicines that help prevent blood clots)
→ during surgery, it keeps blood clots from forming.
→ This compound is sourced from pigs. [cleaner than those derived from cows or dogs].
Mains Link:
 Write a note on Xenotransplantation.

NET ZERO BUILDING / NET ZERO ENERGY BUILDING / NET-ZERO BUILDING / NET-ZERO ENERGY BUILDING
About:
 What:
→ Building that relies on renewable sources to produce energy for its usage.
→ Homes, other structures that create almost as much energy as they use.
 Feature:
→ It may also produce energy surplus, thereby sending excess energy back to electrical grid.
→ energy-conscious design.
→ Solar panels
→ Its many features work without energy source. For example:
 In cold climates, south-facing buildings with large windows on that side can produce heat through solar gain.
 On cold north side of building, smaller windows can angle to wider openings, permitting more light while limiting
heat loss.
 In warmer seasons, passive ventilation systems can pull cool air up from lower levels and vent it through
building’s highest point.
 Rooftop systems can collect rainwater.

ARTIFICIAL MOON / FAKE MOON / MINI MOON / MINI-MOON

News:
Page 5 of 719
  Jan 2022:
→ China is building artificial moon research facility.
About:
 What:
→ research facility to mimic lunar environment on Earth (low gravity).
 Objective:
→ make gravity “disappear” by using powerful magnetic fields inside vacuum chamber.
 Origin:
→ Idea to develop artificial moon facility has its roots in Russian -born physicist Andre Geim’s experiments to
levitate frog with magnet. Andre Geim’s later won Nobel for this groundbreaking experiment.
 Feature:
→ It is capable of lowering gravity level using magnetism.
→ 1 st of its kind in world.
→ It would work as mirror, reflecting sunlight back to Earth, light up night sky .
 Principle behind:
→ Atoms are made up of atomic nuclei and tiny electrons that orbit them in little loops of current. These moving
currents, in turn, induce tiny magnetic fields.
→ Usually, randomly oriented magnetic fields of all atoms in object cancel out, and no material-wide magnetism
manifests.
→ Howeever, application of external magnetic field to these atoms, changes everything. Electrons will modify their
motion, producing their own magnetic field to oppose applied magnetic field.
→ If external magnet is strong enough, magnetic force of repulsion between it and magnetic field of atoms will grow
powerful enough to overcome gravity and levitate said object into air.
 Uses:
→ China plans to use this research facility to test out instruments and technology in low -gravity environment
similar to that of moon, and see whether its experiments can be successful on lunar surfa ce.
→ It is also expected to help in determining possibility of human settlement on moon.
Note:
 Magnetic levitation:
→ mimicking microgravity by using magnetic fields
→ Magnetic levitation is certainly not same as antigravity, but is expected to benefit in space research.

FEBRUARY, 2022
UNITED NATIONS COMMISSION ON INTERNATIONAL TRADE LAW (UNCITRAL) [1966]
News:
 Feb 2022:
→ Economic Survey 2021-22 highlights need for “standardised framework for cross -border insolvency” that
will help lenders of debt-ridden companies to claim and recover corporations’ assets and liabilities on
foreign shores also.
→ Economic Survey 2021-22 survey mentions report of 2020 Insolvency Law Committee, which had
recommended adoption of UNCITRAL with certain modifications t o bring foreign assets under insolvency
process.
 Need:
• 2016 IBC currently does not allow for automatic recognition of any insolvency proceedings in other
countries. And present provisions lead to uncertainty of outcomes of claims for creditors, debtors, other
stakeholders as well.
About:
 What:
→ subsidiary body / committee of UNGA
→ responsible for helping to facilitate international trade and investment.
→ established by UNGA
→ headquartered - Vienna
 Mandate:
→ promote progressive harmonization and unification of international trade law through conventions, model
laws, other instruments that address key areas of commerce (dispute resolution, procurement, sale of
goods, etc).
→ UNCITRAL carries out its work at annual sessions held alternately in New York City and Vienna .
 Feature:
→ It provides legislative framework that can be adopted by countries with modifications to suit domestic
context.

Page 6 of 719
 → It allows foreign professionals, foreign creditors direct access to domestic courts and enables them to
participate in / commence domestic insolvency proceedings.
→ It allows recognition of foreign proceedings and enables courts to determine relief accordingly.
 India:
→ member.

NATURAL GAS
News:
 2020:
→ BIS develops one Hydrogen enriched Compressed Natural Gas (H -CNG) for automotive purposes, as fuel.
 Dec 2021:
→ Push for adopting “Hydrogen-enriched Compressed Natural Gas (HCNG).” [This comes in backdrop of
India’s National Hydrogen Energy Mission].
About:
 What:
→ fossil fuel
→ but cleanest fossil fuel.
→ naturally occurringhydrocarbon gas mixture, consisting primarily of CH4.
 Property:
→ potent GHG. Releases CO2 during oxidation.
 Formation of Petroleum and Natural Gas:
→ Milions of years ago on ocean floor, marine plants and animals died.
→ Remains were covered by silt and sand.
→ Remains were buried deeper and deeper.
→ Enormous heat and pressure turned buried remains into oil and natural gas.
 Uses:
→ Feedstock in manufacture of fertilizers, plastics, organic chemicals
→ Fuel for electricity generation, industrial, commercial units.
→ Transportation fuel for vehicles.
→ Cooking fuel in domestic households.
 India:
→ Reserves of Natural Gas in India:
 west coast
Note:
 Hydrogen-enriched Compressed Natural Gas (HCNG / H-CNG):
→ What:
 blending of hydrogen with CNG
 H blended CNG gas.
→ Advantage:
 Its combustion produces fewer undesirable gases.
 HCNG reduces emissions of CO, NO.
 Enables savings in fuel.
 Engines need minimum modification to run on HCNG.
 Ideal fuel for high load applications, heavy-duty vehicles.
 Better performance [due to higher Octane rating of H2].
→ Disadvantage:
 Determining most optimized H2 / NG (Natural Gas) ratio.
 requires new infrastructures for preparing HCNG.
 Many steps needed for commercializing it at large scale.
 Cost of H2 is > cost of Natural Gas. So, HCNG cost is > cost of CNG.
→ Usage:
 It can be used instead of gasoline, diesel fuel, propane / LPG
 It can be 1st step towards future Hydrogen economy.
Mains Link:
 Discuss the potential of natural gas reserves in India.

ROPEWAY
News:
 Feb 2022:
→ In Union Budget 2022-23, Union Finance Minister announces “Parvatmala” scheme to improve connectivity
in hilly areas.
Page 7 of 719
About:
 What:
→ form of naval lifting device via ropes and is used to transport light stores, equipment, people across rivers
or ravines.
 Benefits:
→ Economical mode of transportation:
 Given that ropeway projects are built in straight line over hilly terrain, it also results in lower land acquisition
costs.
→ Faster mode of transportation:
 Because of aerial mode of transportation, ropeways have advantage over roadway projects where ropeways can
be built in straight line, over hilly terrain.
→ Environmentally friendly:
 Low dust emissions.
 Material containers do not soil environment.
→ Last mile connectivity:
 Ropeway projects adopting 3S kind of cable car system or equivalent technologies can transport about 6000-
8000 passengers per hour.
→ Ideal for difficult / challenging / sensitive terrain / hilly terrain.
 Initiative:
→ Parvatmala [2022]:
 What:
• National Ropeways Development Programme.
 Objective:
• To improve connectivity and convenience for commuters
• To promote tourism.
 Feature:
• This will be preferred ecologically sustainable alternative to conventional roads in difficult hilly areas.
• This may also cover congested urban areas, where conventional mass transit systems are not feasible.
 Nodal Ministry:
• Ministry of Road Transport and Highways (MORTH).
 Present status:
• This scheme is started in regions like JK, HP, Uttarakhand, Manipur, other NE States.

SOLAR MISSION / MISSION TO SUN / MISSION NEAR SUN

News:
 May 2021:
→ NASA and European Space Agency’s solar orbiter spacecraft captures 1 st solar eruptionon Sun’s surface,
also known as - coronal mass ejections (CME).
→ CME can emit plasma and electrically charged particles towards Earth.
 May 2021:
→ Parker Solar Probebriefly swings around Venus using Venus’ gravity.
→ Parker Solar Probe measures 1 st direct measurement of Venusian atmosphere in nearly 30 years.
 September 2021:
→ Using Parker Solar Probe data, scientists assembled most complete picture yet of inner structure and
behavior of large cloud of space dust (zodiacal cloud), that swirls throughout solar system.
 Finding:
• Scientists found 3 dust populations in cloud:
• Most of grains are being slowly pulled in toward Sun (alpha-meteoroids).
• Grains in swirling cloud collide and thereby creating fragments so small that they are pushed out of solar
system in all directions by pressure from sunlight (beta-meteoroids).
• A 3rd group, probably created when cometary debris collide with grains from above 1st two populations, is
scattered out in distinctive wedge shape.
 Dec 2021:
→ Parker Solar Probe made extremely close encounter with Sun (about 6 million miles away) and passed by at
ridiculous speed, making Parker Solar Probe fastest artificial object ever created. This makes Parker Solar
Probe closest satellite to survive near pass of Sun.
 Dec 2021:
→ Parker Solar Probe becomes 1 st spacecraft to fly through outer atmosphere of Sun (Corona). [It sampled
magnetic fields, particles in Sun’s Corona].
 Significance:

Page 8 of 719
 • This achievement would help scientists discover critical information about Sun and its influence on our solar
system.
 Feb 2022:
→ For 1st time in history, we can see planet Venus in Color (pictures of surface of Venus revealing stunning
continents, plains, plateaus, even layer of Oxygen), thanks to NASA Parker Solar Probe.
 Feb 2022:
→ NASA selected science missions – Multi-slit Solar Explorer (MUSE) and HelioSwarm – to help improve our
understanding of dynamics of Sun, Sun-Earth connection, and constantly changing space environment.
About:
 Parker Solar Probe [2018]:
→ What:
 NASA
 It will travel through Sun’s atmosphere, within orbit of Mercury, closer to Sun’s surface than any spacecraft
before.
 It will provided humanity with closest-ever observations of Sun (star).
 unlock mysteries of sun’s atmosphere
→ Objective:
 Study solar corona and solar wind
 Study plasma and magnetic fields of Sun
 Study energectic particles of Sun
→ Journey:
 Parker Solar Probe will use Venus’ gravity during flybys to gradually bring its orbit closer to sun.
→ Significance:
 It collects valuable data about our star and relays information back to Earth for scientists to interpret like -
Information regarding solar wind, solar dust particles.
 NASA hopes Parker Solar Probe’s findings will enable scientists to forecast / predictchanges in Earth’s space
environment.
 It will revolutionize our understanding of sun, where changing conditions can propagate out into solar system,
affecting Earth.
 NASA’s historic Parker Solar Probe mission will revolutionize our understanding of Sun.
 In 2021, Parker Solar Probe became 1 st spacecraft to fly through outer atmosphere of Sun (Corona). [It
sampled magnetic fields, particles in Sun’s Corona]. [This achievement would help scientists discover critical
information about Sun and its influence on our solar system.]
 Aditya-L1 Mission:
→ What:
 Aditya is satellite to be placed in L1 point.
 India’s 1st solar mission.
 planned to be launched by ISRO using Polar Satellite Launch Vehicle (PSLV)-C56
→ Aim:
 Study:
• Sun’s corona
• solar emissions
• solar winds
• solar flares
• Coronal Mass Ejections (CMEs)
 carry out round-the-clock imaging of Sun.
→ Position of Aditya satellite - Lagragian points:
 Lagragian points are points near two large orbiting celestial bodies like - Sun and Earth.
 At Lagrange points, gravitational forces and centrifugal forces of two large bodies balance each other out.
 i.e. these Lagrange points are stable points.
 Thus, Lagrange points are excellent location for satellites, because lessorbital corrections are needed to maintain
desired orbit
 As such, Aditya-L1 satellite will be placed in halo / circular orbit around Lagrangian point 1 (L1) of Sun-Earth
system so as to study Sun properly by continuous viewing of Sun without any eclipses and without many
adjustments of orbital corrections.
→ Significance:
 Solar storms:
• Helpful in finding / identifying correct model among current different models for origin of solar storms.
• Helpful in finding how solar storms evolve and what path solar storms take through interplanetary space
from Sun to Earth.
 Solar Orbiter (SOLO) [2020]:
Page 9 of 719
 → What:
 Solar Orbiter is Sun-observing satellite / spacecraft / space mission
 developed by European Space Agency (ESA). [in collaboration with NASA]
→ Purpose:
 Taking closest ever images of Sun
 observing solar wind
 observing Sun’s polar regions like never before
 unravelling mysteries of solar cycle
 Measurement of inner heliosphere [How does Sun create and control heliosphere]
 Measurement of nascent solar wind
 close observations of polar regions of Sun [difficult to do from Earth]
 Ulysses spacecraft [1990]:
→ collaboration between NASA and ESA
 Heliophysics Flight / Mission [1997]:
→ NASA
 Multi-slit Solar Explorer (MUSE) [2022]:
→ MUSE mission will help scientists understand forces driving heating of Sun’s corona and eruptions in outermost
region that are at foundation of space weather.
→ It will offer deeper insight into physics of solar atmosphere by using powerful instrument known as multi-slit
spectrometer to observe Sun’s extreme ultraviolet radiation and obtain highest resolution images ever captured of
solar transition region and corona.
→ It will provide deeper insights into our universe and offer critical information to help protect astronauts, satellites,
communications signals like GPS.
 HelioSwarm [2022]:
→ HelioSwarm mission is constellation or “swarm” of 9 spacecraft that will capture 1stmultiscale in-space
measurements of fluctuations in magnetic field and motions of solar wind known as solar wind turbulence.
→ Sun’s outermost atmospheric layer (heliosphere) encompasses enormous region of solar system.
→ Solar winds spread through heliosphere, and their interactions with planetary magnetospheres and disruptions like
coronal mass ejections affect their turbulence.
→ It will provide deeper insights into our universe and offer critical information to help protect astronauts, satellites,
communications signals like GPS.
Note:
 Study of sun, solar wind, Sun corona:
→ Sun:
 Sun is only star we can study up close.
 By studying Sun (star) we live with, we learn more about stars throughout Universe.
 Sun is source of light and heat for life on Earth. The more we know about Sun, more we can understand
how life on Earth developed.
→ Solar wind:
 Sun is source of solar wind - flow of ionized gases from Sun that streams past Earth at high speeds.
 Solar winds affects Earth’s magnetic field and emit radiation energy in near -Earth space (space
weather).
 Effects on satellites:
• Solar winds / space weather near Earth can:
 change orbits of satellites
 shorten satellits lifetimes
 interfere with electronics onboard satellites.
The more we learn about what causes solar winds / space weather – and how to predict it –more we can
protect our satellites on which we humans depend.
 Astronaut’s safety:
 Solar winds dominate space weather / environment near Earth.
 As we send spacecraft and astronauts, we must understand solar winds / space weather / space
environment for safety and preparedness.
→ Sun corona:
 Sun corona is hotter than Sun surface.
 Sun corona emits solar wind (charged particles that travels through solar system)
 Solar winds, which are upredictable, cause disturbances to Earth’s magnetic field.
 Solar winds can cause harm to communicationsystems on Earth.
 Interplanetary Dust Cloud / Zodiacal cloud:
→ It consists of cosmic dust (small particles floating in outer space) that is present in space between planets
within planetary systems like Solar System.
Page 10 of 719
 → This system of particles are studied for many years in order to understand its nature, origin, relationship to
larger bodies.
→ In Solar System, interplanetary dust particles play role in scattering sunlight and in emitting thermal
radiation, which is most prominent feature of night sky's radiation like infrared emission near Earth's orbit.
→ It scatters sunlight that can be seen with naked eye, but only on very dark, clear nights, as moonlight or light
from cities both easily outshine it.
→ Thickest near sun and thinnest near edges of solar system, zodiacal cloud looks smooth to naked eye, but
infrared wavelengths reveal bright streaks and ribbons that can be traced back to their sources (comets,
asteroids).
→ Sources are:
 asteroid collisions
 cometary activity in Solar System
 cometary collisions in Solar System
 Kuiper belt collisions
 interstellar medium grains.
Value Addition:
 Magnetic reconnection:
→ News:
 In 2020, international solar physicists measured global magnetic field of Sun’s corona (outer
atmosphere), for very 1 st time.
→ What:
 physical process occurring in highly conducting plasmas in which magnetic topology is rearranged and
magnetic energy is converted to kinetic energy, thermal energy, particle acceleration.
 It occurs on timescales intermediate between slow resistive diffusion of magnetic fie ld and fast
Alfvenic timescales.
 process where opposite polarity magnetic field lines connect and some of magnetic energy is
converted to heat energy, kinetic energy which leads to generation of heating, solar flares, solar jets,
etc.
→ Origin:
 Concept of magnetic reconnection was 1 st introduced in 1950 by James Dungey to explain coupling of
mass, energy, momentum from solar wind into Earth's magnetosphere.
→ Significance:
 It plays role in coronal heating, coronal mass ejection, solar flare,
Mains Link:
 Discuss how Solar Flares influence earth’s environment.
 Discuss the significance of Aditya-L1 mission.
 What are solar winds? Discuss.

SWAMITVA YOJANA [2020]

News:
 2020:
→ Govt. launches SWAMITVA scheme.
 April 2021:
→ Swamitva scheme is extended to all States.
 Feb 2022:
→ Government says it plans to prepare digital maps of all its 6,00,000 villages. And, pan-India 3D maps will be prepared
for 100 cities under SVAMITVA scheme.
About:
 What:
→ Survey of Villages And Mapping with Improvised Technology in Village Areas
→ Scheme to map residential land ownership in rural areas using modern technology like drones.
→ under Ministry of Panchayati Raj and Rural Development
→ property record maintenance in India
 Need:
→ Villagers in rural areas don’t have papers proving ownership of their land and this gave rise to many
problems – land dispute litigants in courts etc.
 Features:
→ residential land in villages will be measured using drones to create non-disputable records.
→ update rural land records
→ providing record of rights to village households
→ usage of property as financial asset for taking loans etc.

Page 11 of 719
 → Property card:
 For every property in village, property card will be prepared by States using accurate measurements delivered
by drone-mapping.
 These cards will be given to property owners.
 will be recognised by land revenue departments.
 property holders can download their property cards (digital)
 Benefits:
→ Delivery of property rights / cards
→ Property cards will be recognised by govt. land revenue departments.
→ Reducing land disputes
→ Accurate property records will increase tax collection.
 Present status:
→ Drone surveys covered about 1,00,000 villages and maps of about 77,000 villages were handed over to
States.
→ Property cards were distributed to about 27,000 villages.
 Significance:
→ It may become tool for empowerment and entitlement, reducing social strife on account of discord over
properties.
Mains Link:
 Discuss the need for and significance of the scheme.

REFUGEE
News:
 March 2021:
→ Ministry of Home Affairs (MHA) writes to Arunachal Pradesh, Nagaland, Manipur and Mizoram to take
appropriate action as per law to stop illegal influx from Myanmar, in c/w 2021 Myanmar military coup.
→ Centre says State governments has no powers to grant refugee status to any foreigner.
→ Centre also says that India is not signatory to UN Refugee Convention, 1951.
 April 2021:
→ Supreme Court says Rohingya illegal migrants will not be deported to Myanmar without followin g law.
 May 2021:
→ High Court of Manipur allows Myanmar nationals, who entered India secretly after military coup, to travel
to New Delhi to seek protection from United Nations High Commissioner for Refugees (UNHCR), located in
Delhi.
→ High Court of Manipur Judgment:
 Though India is not party to 1951 UN Refugee Convention, India is party to:
• Universal Declaration of Human Rights, 1948
• International Covenant on Civil and Political Rights, 1966.
 Article 21, as interpreted by Supreme Court time and again, will hold right of non-refoulement.
 Dec 2021:
→ Vodafone auctioned world’s 1 st SMS as Non-Fungible Token (NFT).Vodafone will donate fund received from
this auction to UNHCRto support millions people forced to flee their homes due to conflict, persecution.
 Feb 2022:
→ NHRC held discussion on protection of basic human rights of refugees and asylum seekers in India. During
meet, NHRC expressed concern over issue of India not having specific law for refugees and asylum -seekers.
NHRC also suggested that model laws on asylum and refugees that were drafted by NHRC decades ago but
not implemented by government could be revised by expert committee.
→ Union Housing Minister Hardeep Singh Puri tweets that Rohingya refugees would be shifted to flats meant
for Economically Weaker Sections (EWS), and be provided with basic amenities and police protection. He
says India respects & follows 1951 UN Refugee Convention & provides refuge to all, regardless of their race,
religion or creed. Later, MHA issues clarification that no such direction had been given to provide EWS flats
to “Rohingya illegal foreigners”.
About:
 What:
→ According to UN Refugee Convention, 1951, refugee is defined as person who:
 is outside his / her country of nationality or habitual residence;
 has well-founded fear of persecution because of his / her race, religion, nationality, membership in particular
social group or political opinion; and
 is unable or unwilling to avail himself / herself of protection of that country, or to return there, for fear of
persecution.
 United Nations Refugee Convention [1951]:

Page 12 of 719
 → builds on UN Universal Declaration of Human Rights, 1948
→ UN multilateral treaty
→ defines who is refugee:
 Refugee:
• According to UN Refugee Convention, 1951, refugee is defined as person who:
 is outside his / her country of nationality or habitual residence;
 has well-founded fear of persecution because of his / her race, religion, nationality, membership in
particular social group or political opinion; and
 is unable or unwilling to avail himself / herself of protection of that country, or to return there, for fear
of persecution.
→ sets out rights of individuals who are granted asylum
→ sets out responsibilities of nations that grant asylum.
→ grants certain rights to people fleeing persecution because of race, religion, nationality, particular social
group, or political opinion.
→ sets out people who do not qualify as refugees like - war criminals.
→ provides for visa-free travel for holders of travel documents issued under this convention.
→ its1967 Refugee Status Protocol included refugees from all countries (originally it included refugees from
Europe only).
→ India:
 not member / signatory
 India:
→ India is non-signatory to 1951 UN Refugee Convention, 1967 Refugee Status Protocol. India was venue for
single largest influx of refugees since 2nd World War, when millions of people crossed over from erstwhile
East Pakistan to India in 1971. UNHCR is allowed to operate in India since 1981. Foreign nationals who enter
India without valid travel documents are treated as illegal migrants.
→ Laws and regulations regulating refugees:
 India has not passed any legislation / law that specifically refers to refugees. Hence, refugees (Rohingya refugees
etc.) are usually considered together with illegal immigrants deported by government under Foreigners Act,
1946 and subsequent Foreigners Orders. However, legally, refugee is special category of immigrant and cannot
be clubbed with illegal immigrants. India is not signatory to 1951 UN Refugee Convention. All foreign
undocumented nationals are governed as per: Foreigners Act, 1946; Registration of Foreigners Act, 1939.
Passport Act, 1920; Citizenship Act, 1955.
 Deportation: According to MHA, illegal immigrants are detected, detained and deported under Passport
Act, 1920 and Foreigners Act, 1946. Power to identify and deport them are also delegated to State
governments and UTs. Once foreigner has been apprehended by police for staying illegally, without any
document, he is produced before local court. If he is found guilty, he can be imprisoned for 3 months to
8 years. After completing his sentence duration, court orders deportation. Foreign inmates are moved
to detention centers till country of origin verifies and accepts them.
As per one report of Human Rights Watch (HRW), since 2018, India has deported 12 Rohingya to
Myanmar, claiming that they left voluntarily.
→ Need for refugee law / asylum law:
 Refugees and asylum seekers are entitled to rights in Article 14, Articles 20, Articles 21. Therefore, it becomes
responsibility of state to protect refugees’s and asylum’s rights.
 There exists lack of clarity for law enforcement agencies.
 If law is enacted, it would give legal sanctity and uniformity, ensuring protection of human rights.
 International human rights law protects all individuals, regardless of their status.
→ Supreme Court:
 Article 14 (Equality before law)is available to both citizens and foreigners.
 Article 21 (Protection of life and personal liberty)is also available to both citizens and foreigners.
 Article 19 (Protection of certain rights regarding freedom of speech, etc) is available only to citizens:
• Right of “not to be deported” is associated only with citizenship.
• Right of not to be deported, naturally follows right to reside and settle in any part of territory of India,
guaranteed to all citizen under Article 19.
→ Way Forward:
 Update old NHRC documents regarding domestic asylum laws and model law for refugees. This updation may
be done by constituting committee of scholars and domain experts.
Note:
 United Nations High Commissioner for Refugees (UNHCR) [1950]:
→ UN Refugee Agency
→ global organization
→ Function:

Page 13 of 719
  saving lives, protecting rights, building better future for refugees, forcibly displaced communities and stateless
people.
→ Origin:
 to help Europeans who had fled or lost their homes, after WW-II.
→ headquartered - Geneva, Switzerland.
→ India:
 India is non-signatory to 1951 UN Refugee Convention or 1967 Refugee Status Protocol.
 India was venue for single largest influx of refugees since 2nd World War, when millions of people crossed over
from erstwhile East Pakistan to India in 1971.
 UNHCR is allowed to operate in India since 1981.
 Non-refoulement:
→ Principle under international law that person fleeing from persecution from his own country should not be
forced to return.
 Mizoram:
→ India and Myanmar share > 1500km border.
→ People on either side have family ties.
→ Mizoram have provided food and shelter to influx myanmar people on ground of humanitarian.
 World’s 1st SMS:
→ This SMS was sent almost 3 decades ago in 1992 through Vodafone network. This SMS was received by
Vodafone employee Richard Jarvis. It read “Merry Christmas”.
Value Addition:
 Refugee crises around world:
→ Burundi Emergency
→ Democratic Republic of Congo (DRC) Crisis
→ Europe Situation
→ Nigeria Situation
→ South Sudan Situation
→ Venezuela Crisis
→ Central African Republic (CAR) Crisis
→ Displacement in Central America
→ Iraq Situation
→ Rohingya Crisis
→ Syrian Refugee Crisis
→ Yemen Crisis
→ Afghan Refugees Situation
 Migrant:
→ There is no universal, legal definition of ‘migrant’.
→ Office of United Nations High Commissioner for Human Rights (OHCHR) describes international migrant as
any person who is outside state of which they are citizen or national, or, in case of stateless person, their
state of birth or habitual residence.
→ ‘Migrant’ is used as neutral term to describe group of people who have in common lack of citizenship
attachment to their host country. It does not get protection regimes like that exist under international law
for specific legal categories of people - refugees, stateless persons, trafficked persons, migrant workers.
 Migrant vs Refugee:
→
{migrant} {refugee}
no such precise and universal definition of a migrant defined in international law as a person who is fleeing
persecution or conflict in her or his country of origin
refugees are entitled to the full protection of refugee
law, including protection from expulsion or return to
situations of persecution where their life and freedom
are at risk
Mains Link:
 Analyze internal security threats and transborder crimes along Myanmar, Bangladesh and Pakistan borders including the
Line of Control (LoC). Also, discuss the role played by various security forces in this regard. (UPSC 2020)

ACCREDITATION
News:
 Feb 2022:
→ National Assessment and Accreditation Council (NAAC) relaxes eligibility criteria for accreditation of higher
educational institutions, to widen horizon of accreditation.
Page 14 of 719
About:
 What:
→ Evaluation by independent, 3 rd -party of conformity assessment body (like certification body, inspection
body or laboratory) against recognised standards, conveying formal demonstration of its impartiality and
competence to carry out specific conformity assessment tasks ( like certification, inspection and testing).
→ Accreditation is quality check exercise
 Accreditation [Education]:
→ India:
 Feature:
• Accreditation is made mandatory through University Grants Commission (Mandatory Assessment and
Accreditation of higher Educational Institutions) Regulations, 2012.
• Accreditation checks whether institution meets certain standards of quality set by evaluator in terms of
curriculum, faculty, infrastructure, research, financial well-being, etc.
• NAAC gives institutions grades ranging from A++ to C. If institution is graded D, it means it is not accredited.
 Benefits:
• Recognition
• accredited institutions attract capital as funding agencies look for objective data for performance funding.
• It helps institution know its strengths, weaknesses, opportunities through informed review process.
• Accreditation helps students going for higher education abroad because many global higher education
authorities insist on recognition and accreditation of that institution where student has studied.
 Status:
• About 350 universities and 8000 colleges are NAAC-accredited.
• Region-wise, northern States have highest number of accredited universities, followed by south, west.
• Maharashtra - highest number of accredited colleges.
• Tamil Nadu - most accredited universities.
 Initiative:
• In 2019, UGC launched Paramarsh scheme. Under this scheme, some of best performing institutes were
identified to serve as mentors to at least 5 institutes aspiring to get accredited.

NEUTRINO
News:
 April 2021:
→ Russia launches Baikal-GVD (Gigaton Volume Detector) in Baikal Lake, Siberia, Russia.
 June 2021:
→ Scientists shows geometry of space-time can cause neutrinos to oscillate (different types of neutrinos change
into one another).
 Feb 2022:
→ Tamil Nadu says to Supreme Court that it does not want India-based Neutrino Observatory (INO) to be set up
in sensitive ecological zone in Western Ghats at great cost to wildlife, biodiversity, and by ignoring local
opposition and public agitations to INO project.
About:
 What:
→ detected for 1st time in 1959. high-energy fundamental particles. 2nd most abundant particle in universe, only
second to photons (light particles). pose no threat to us and pass through most solid objects without anyone
even noticing. Neutrinos constantly bombard Earth. Every second, trillions of nutrinos pass right through each
of us, though we never feel / notice them. 1st proposed by Swiss scientist Wolfgang Pauli in 1930. Neutrino is
one fermion that interacts only via weak interaction and gravity. Neutrino is so named because it is electrically
neutral and because its rest mass is so small that it was long thought to be 0.
 Feature:
→ Fundamental. Abundant. Elusive (difficult to find). Oscillating. Lightweight. Diverse. Mysterious.
Neutrinos interact very weakly with matter. But if they do smash into atom, they produce secondary
particles that we can detect, which allows us to probe where they came from in universe. Neutrinos have
energies capable of producing radio pulses in ice because of Askaryan effect. Most neutrino observatories
are located deep inside Earth’s surface.
 Formation / source:
→ during Big Bang
→ supernova explosions
→ nuclear reactions in stars
→ particle decays in Earth
→ explosion of stars
→ particle accelerators

Page 15 of 719
 → nuclear power plants
 Reason for formation:
→ due to radioactive decays - during supernova, cosmic rays striking atoms etc.
 Need for studying:
→ Helps in understanding origin of universe because some neutrinos were formed during Big Bang.
→ Studying oscillations of neutrinos and their relations with mass helps in understanding origin of universe,
energy production in stars.
→ It is believed that phenomenon of neutrino oscillations require neutrinos to have tiny masses.
→ Neutrino tomograph of earth i.e. detailed investig ation of structure of Earth from core onwards because
neutrinos are only particles which can probe deep interiors of Earth.
 Neutrino detectors:
→ Baikal Deep Underwater Neutrino Telescope (BDUNT) / Baikal-GVD (Gigaton Volume Detector), 1990:
 What:
• neutrino telescope.
• among world’s biggest underwater neutrino telescope.
• in Siberia, Russia.
 Aim:
• study neutrinos – to find nutrino sources.
→ Antarctic Impulsive Transient Antenna (ANITA), 2006.
 radio telescope to detect ultra-high energy cosmic-ray neutrinos from scientific balloon (equiped with radio
antennas) flying over Antarctica.
 experiment to study ultra-high-energy (UHE) cosmic neutrinos by detecting radio pulses emitted by their
interactions with Antarctic ice sheet, by using array of radio antennas suspended from helium balloon flying at
height of about 37 km above Antarctica surface.
 1st NASA observatory for neutrinos.
→ ANTARES, 2008:
 Astronomy with Neutrino Telescope and Abyss environmental RESearch project.
 in Mediterranean Sea.
→ IceCube Neutrino Observatory, 2010:
 at South Pole.
 India:
→ India-based Neutrino Observatory (INO) [India]:
 What:
• neutrino detector of India
• under construction in deep cave of INO Peak, TN.
• particle physics research project.
• in Tamil Nadu
• among biggest experimental particle physics project in India.
• world-class underground laboratory with rock cover
• mega-science project
 Aim:
• study neutrinos
• non-accelerator based high energy and nuclear physics research in India.
 Component:
• Construction of one underground laboratory and associated surface facilities at Pottipuram village in Bodi
West hills, Tamil Nadu.
• Construction of one Iron Calorimeter (ICAL) detector for studying neutrinos.
• Setting up of National Centre for High Energy Physics at Madurai, for operation and maintenance of said
underground laboratory, human resource development and detector R&D.
 Funding:
• jointly funded by Department of Atomic Energy (DAE) and Department of Science and Technology (DST).
 Why underground?
• Neutrinos are notoriously difficult to detect in laboratory because of their extremely weak interaction with
matter.
• Background from cosmic rays (which interact much more readily than neutrinos) and natural radioactivity
will make it almost impossible to detect neutrinos on surface of Earth.
• Earth materials are transparent to neutrinos and most background from cosmic rays are substantially
reduced inside underground, depending on depth at which neutrino detector is located.
 Opposition:
• This INO project falls exactly on hill slopes of Western Ghats, which fall within its significant tiger corridor
(Mathikettan-Periyar tiger corridor).
Page 16 of 719
 • This Mathikettan-Periyar tiger corridor links Periyar Tiger Reserve along Kerala and Tamil Nadu borders and
Mathikettan Shola National Park (Kerala).
• This INO project area is also ecologically linked to eastern habitats, where Srivilliputhur Meghamalai Tiger
Reserve is located, which hosts tigers from this region and helps in genetic dispersal.
• INO project area is significant watershed and catchment zone for Sambhal R. and Kottakudi R.
Note:
 Askaryan effect / Askaryan radiation:
→ phenomenon whereby particle traveling faster than phase velocity of light in dense dielectric (salt, ice etc.)
produces secondary charged particles.
 Baikal Lake:
→ in Siberia, Russia:
→ deepest L.in world
→ largest freshwater L. in world.
Question:
 ‘IceCube’, one particle detector located at South Pole is world’s largest neutrino detector, encompassing 1 cubic km of
ice. It is one powerful telescope to search for dark matter. It is buried deep in ice. IceCube Neutrino Observatory is
constructed at Amundsen–Scott South Pole Station in Antarctica. This project is one recognized CERN experiment. It is
buried beneath surface, extending to depth of about 2,500 meters.
 In context of modern scientific research, ‘IceCube’ is one particle detector located at South Pole. It is world’s largest
neutrino detector, encompassing 1 cubic km of ice. It is one powerful telescope to search for dark matter. It is buried
deep in ice. IceCube Neutrino Observatory is one neutrino observatory constructed at Amundsen–Scott South Pole
Station in Antarctica. This project is one recognized CERN experiment. Its thousands of sensors are located under
Antarctic ice, distributed over 1 cubic km.
Mains Link:
 Critically examine the uses of understanding of neutrinos, and significance of its research for India.

PUBLIC EXPENDITURE
News:
 Feb 2022:
→ Karnataka Administrative Reforms Commission-2 recommends constitution of ‘Cut Waste Task Force’ to slash
wasteful expenses incurred by many departments of Karnataka State Government, boards, corporations. It also
recommends performance appraisal for officers and staff, timely payment of compensation for land acquisition.
About:
 What:
→ Public expenditure is spending made by government of country on collective needs and wants, like pension,
education, healthcare, housing, security, infrastructure, etc.
 History:
→ In 17th and 18th centuries, public expenditure was considered wastage of money. Thinkers then believed
government should stay with their traditional functions of spending on defense and maintaining law & order. Thus,
until 19th century, public expenditure was limited as laissez faire philosophies believed that money left in private
hands could bring better returns.
→ In 20th century, John Maynard Keynes argued role of public expenditure in determining levels of income and
distribution in economy. Since then, government expenditures has shown increasing trend.
Note:
 Cut Waste Task Force [Karnataka]:
→ What:
 In 2022, Karnataka Administrative Reforms Commission-2 recommended constitution of ‘Cut Waste Task Force’
to slash wasteful expenses incurred by many departments of Karnataka State Government, boards,
corporations. It also recommended performance appraisal for officers and staff, timely payment of
compensation for land acquisition.
 Karnataka Cut Waste Task Force could receive suggestions from public, internal and external stakeholders, on
areas where government can cut waste and effect savings in delivery of public services and in its day-to-day
functioning.
→ Note:
 Similar model is already adopted by Singapore since 2003. Within 3 years of its inception, it managed to save
over USD 10 million of public resources by implementation of accepted suggestions.
Mains Link:
 Public expenditure management is a challenge to the Government of India in the context of budget making during the
post-liberalization period. Clarify it. (UPSC 2019)

CORD BLOOD / UMBILICAL CORD BLOOD (UCB)

News:
Page 17 of 719
  2021:
→ Cord Blood Banking Services Market is valued at about USD 1000 mn. It is estimated to reach about USD 2500 mn by
2023.
 Reason:
• Rise in awareness related to benefits of using cord blood stem cells for treatment of chronic diseases, such
as cancer.
• Increase in government initiative leading to increase in number of cord blood banks
 Feb 2022:
→ One USA woman has been cured of HIV after receiving transplant of umbilical cord blood. She has become 3 rd person
in world, and 1st woman, to be cured of HIV.
 Significance:
• This is 1st time that umbilical cord blood transplant is successfully carried out on HIV patient. This approach
is likely to make treatment more widely available.
• This breakthrough treatment only requires partial matches and not exact matches. Thus, it opens up
treatment options for people from diverse racial backgrounds.
About:
 What:
→ blood that remains in placenta and in attached umbilical cord after childbirth.
→ blood that remains in umbilical cord and placenta,postdelivery.
→ It contains Hematopoietic stem cells / Blood stem cellsthat are used in treating some diseases.
 Market of Cord Blood Banking Services [India]:
→ It is valued at about USD 1000 m in 2021.
→ It is estimated to reach about USD 2500 mn by 2023.
 Significance:
→ Cord blood is collected because it contains stem cells, which can be used to treat like cancer.
→ umbilical cord fluid contains stem cells which can treat cancer, some immune system disorders, blood diseases -
anemia.
→ There is growing interest from cell therapeutics companies in developing genetically modified allogenic natural killer
cells from umbilical cord blood as alternative to CAR T cell therapies for rare diseases.
→ umbilical cord fluid is easy to collect and has 10 times more stem cells than those collected from bone marrow.
→ Cord blood stem cells carry almost no infectious diseases.
→ Cord blood stem cells most likely would not be rejected by patient’s body during stem cell transplantation.
 Cord blood banking:
→ What:
 Collecting cord blood and storing cryogenically for potential future medical use.
 process of collecting potentially life-saving stem cells from umbilical cord and placenta and storing them for
future use.
→ Initiatives:
 In 2013, GOI had granted about Rs. 9 crore to promote public cord blood banking.
 India has UCB public banks like – School of Tropical Medicine's cord blood bank (Kolkata), Relicord, Jeevan Cord,
Stemcyte.
 India also has some UCB private banks like - Life Cell, Cryo Banks, etc.
 GOI initiatives led to increase in number of cord blood banks.
→ Significance:
 Globally, cord blood banking is recommended as source of hematopoietic stem cell transplantation for
haematological cancers and disorders.
→ Challenge:
 Major problem faced in India is collection of UCB due to high cost and comparatively less functional public banks.
→ Way Forward:
 Considering large population with deliveries in public hospital due to low cost, UCB storage in India needs
increased public-private partnership model where UCB can be stored by affordable and non-affordable people
both.
Note:
 Stem cell:
→ What:
 body's raw materials — cells from which all other cells with specialized functions are generated.
 Stem cells are tiny cells with great potential & have ability to save lives.
 Stem cells are master cells that act as basic building blocks of human body.
 Stem cells are immature cells that can assume form of other cells.
 These cells have unique ability to transform into specialized cells like blood cells, brain cells, muscle cells, bone
cells etc.
Page 18 of 719
  Under right conditions in body or laboratory, stem cells divide to form more cells called daughter cells.
→ Hematopoietic stem cells / blood stem cell:
 found in peripheral blood and bone marrow.
 Blood stem cell goes through many steps to become red blood cell, platelet, or white blood cell.
→ Stem Cell Banking:
 What:
• It is process of procuring precious stem cells from human body, processing and storing them for potential
future use in stem cell treatments.
• Stem cell banks use low temperatures to preserve biological properties of stem cells, protect them from
contamination and degeneration.
• Preserving stem cells obtained from baby's umbilical cord blood at time of birth ensures healthy future for
not just that baby but entire family.
 Issues:
• Companies are aggressively marketing stem cell banking.
• Companies charge enormous fees from parents to preserve stem cells.
• Emotional marketing: Companies emotionally convince parents to bank stem cells for several years,
promising future medical use.
Mains Link:
 What is cord blood? How to-be parents are falling prey to the emotional marketing tactics by stem cell banking
companies? Discuss.

MARCH, 2022
RAMAN EFFECT / RAMAN SCATTERING
News:
 2021:
→ Indian Institute of Technology (IIT) Delhi develops handheld Surface Enhanced Raman Spectroscopy (SERS)-based
platform for early diagnosis of dengue and which also gives dengue test results within 1hour (rapid diagnosis).
About:
 What:
→ change in wavelength of light that occurs when light beam is deflected by matter molecules.
→ Spectroscopy phenomenon discovered by eminent physicist Sir C.V. Raman.
→ Inelastic scattering of photons by matter, meaning that there is both exchange of energy and change in light's
direction.
 Process:
→ When beam of light traverses dust-free, transparent chemical compound, small fraction of light emerges in directions
other than that of incident (incoming) beam i.e. ligth is scattered.
→ Most of this scattered light is of unchanged wavelength (rayleigh scattering). But, small part of scattered light has
wavelengths different from that of incident light (raman scattering).
Note:
 Raman spectroscopy:
→ spectroscopic technique
→ commonly used in chemistry to provide structural fingerprint by which molecules can be identified.
 National Science Day (NSD):
→ 28th February
→ celebrated to commemorate discovery of Raman Effect, which led Sir C.V. Raman to winning Noble Prize.
Mains Link:
 Write a note on Raman Spectroscopy.

EXPLOSIVE WEAPON
News:
 2022:
→ Russia uses dangerous thermobaric bombs in Ukraine. [Cluster weaponry is banned by 2008 Convention
on Cluster Munitions but neither Ukraine nor Russia are signatories].
About:
 Cluster Munition:
→ What:
 form of air-dropped or ground-launched explosive weapon that releases or ejects smaller submunitions.
 Non-precision weapons designed to injure or kill human beings indiscriminately over large area, and to destroy
vehicles and infrastructure like runways, railway, power transmission lines.
→ Feature:
 Commonly, this is cluster bomb that ejects explosive bomblets designed to kill personnel and destroy vehicles.

Page 19 of 719
 cluster bombs release many small bomblets over wide area
Other cluster munitions are designed to destroy runways or electric power transmission lines, disperse chemical
or biological weapons, or to scatter land mines.
 Some submunition-based weapons can disperse non-munitions, like leaflets.
 They can be dropped from aircraft or launched in projectile that spins in flight, scattering many bomblets as it
travels.
→ Impact:
 Because cluster bombs release many small bomblets over wide area, they pose risks to civilians both during
attacks and afterwards.
 Unexploded bomblets can kill or injure civilians and/or unintended targets long after conflict has ended, and are
costly to locate and remove.
 Many of bomblets end up not exploding, but continue to lie on ground, often partially or fully hidden and difficult
to locate and remove, posing threat to civilian population for long after fighting has ceased.
→ Initiative:
 Cluster munitions are prohibited for those nations that ratified 2008 Convention on Cluster Munitions.
 Convention on Cluster Munitions (CCM) [2008]:
• international treaty that prohibits all use, transfer, production, stockpiling of cluster bombs.
• signed in Ireland.
• It established framework to support victim assistance, clearance of contaminated sites, risk reduction
education, stockpile destruction.
• Binding
• India – not party.
 Thermobaric weapon /aerosol bomb / vacuum bomb:
→ type of explosive that uses oxygen from surrounding air to generate high-temperature explosion.
→ They are almost 100% fuel and as result are significantly more energetic and last longer than conventional
explosives of equal weight.
→ Many types of thermobaric weapons can be fitted to hand -held launchers,and can also be launched from
airplanes.
→ Called vacuum bombsbecause they suck in oxygen from surrounding areas to generate high -voltage
explosions.
→ Blast wave is of greater intensity and duration than conventional bombs and can vapourise humans.
→ They can dismantle civilian spaces, like residential or commercial complexes.
→ They cannot be used in taking down tanks, other such military vehicles.
→ Fuel Air Explosive (FAE)is one of best-known types of thermobaric weapons.
→ Vacuum bombs are not prohibited by any international law or agreement, but their use against civilian
populations in built-up areas, schools or hospitals, could attract action under Hague Conventions of 1899
and 1907.
Note:
 Hague Conventions of 1899 and 1907:
→ series of international treaties and declarations negotiated at 2 international peace conferences at Hague
in Netherlands.
→ Along with Geneva Conventions, Hague Conventions are among 1 st formal statements of laws of war and
war crimes in body of secular international law.

LION
News:
 2022:
→ Gujarat forest department develops “Software With Intelligence Marking Based Identification of Asiatic Lions”
(SIMBA).
About:
 Asiatic lion:
→ Panthera leo leo population surviving today only in India.
→ Since 20th century, its range has been restricted to Gir National Park and surrounding areas in Gujarat.
→ Historically, it inhabited much of Middle East to northern India.
→ IUCN - EN

CONJUNCTION [Astronomy]
News:
 2020:

Page 20 of 719
 → Christmas Star /Great Conjunction (conjunction between Saturn and Jupiter), as viewed from Earth, occurs.
It is closest alignment of Saturn and Jupiter since 1623, in terms of distance. Next time they will be this
close is in 2080.
 2022:
→ ISRO used ‘S-band’ radio signals from Mangalyaan to study solar corona and to locate area of Sun where
temperature rises abruptly.
 How:
• ISRO scientists utilised solar conjunction event, when Earth and Mars are on opposite sides of Sun.
• During it, radio signals from Mangalyaan pass through solar corona.
 Significance:
• Mangalyaan’s radio signals passing through solar corona offers unique opportunity to study solar dynamics.
About:
 What:
→ Event when two astronomical objects or spacecraft have either same right ascension or same ecliptic
longitude, usually as observed from Earth.
→ Astronomical event where planets or asteroids appear to be very close together sky when viewed from Earth.
 Solar Conjunction:
→ What:
 Event when planet or other Solar System object is on opposite side of Sun from Earth.
 It can also refer to passage of line of sight to interior planet (Mercury or Venus) or comet being very close to
solar disk. If planet passes directly in front of Sun, solar transit occurs.
→ Feature:
 From Earth reference, Sun will pass between Earth and that object.
→ Impact:
 Communication with any spacecraft in solar conjunction will be severely limited due to Sun's interference on
radio transmissions from that spacecraft.
 There is some lost of data while sending data to Earth.
 There will be some lost of data while sending data to that object in conjunction (like Mars).
 Great Conjunction / Christmas Star:
→ Conjunction of Jupiter and Saturn.
→ Meetings of two biggest worlds in solar system, Jupiter and Saturn.
→ It happens about every 20 years.
→ It is result of orbital paths of Jupiter and Saturn coming into line, as viewed from Earth.
→ Astronomers use word “great” for conjunction of Jupiter and Saturn - 2 largest planets of our solar system -
because of massive sizes of both planets.
Mains Link:
 What is the Great Conjunction? Why is it significant? Discuss.

WATERWAY
News:
 2021:
→ Parliament passes Marine Aids to Navigation Act, 2021.
→ Parliament passes Inland Vessels Act, 2021.
 2022:
→ As Ganga (NW-1) gets connected with Brahmaputra (NW2) via Indo Bangladesh Protocol (IBP) route, Pandu
(in Guwahati) receives maiden voyage of food-grains (on board MV Lal Bahadur Shastri) from Patna via
Bangladesh, making way for new age for inland waterways in Assam.
About:
 What:
→ Any navigable body of water.
 Major waterways:
→ Suez Canal
→ Panama Canal
→ Great Lakes Waterway
→ Saint Lawrence Seaway
 International Waterways:
→ Narrow channels of marginal sea or inland waters through which international shipping has right of
passage.
→ In international law, international waterways are straits, canals, rivers that connect two areas of high seas
or enable ocean shipping to reach interior ports on international seas, gulfs, lakes that otherwise would
be land-locked.

Page 21 of 719
 → International waterways also may be rivers that serve as international boundaries or traverse successively
2 or more states.
→ Ships have right of passage through international waterways. This right is based on
customary international law, treaty arrangements.
 Inland waterway:
→ What:
 Any navigable inland body of water i.e. situated in interior of country rather than on coast.
→ Inland waterways in India / Inland Water Transport (IWT) in India:
 India has extensive network of inland waterways / about 14,500 km of navigable waterways in form of:
• Rivers
• Canals
• Backwaters
• creeks.
 Under National Waterways Act, 2016, about 111inland waterways have been declared / notified as National
Waterways (NWs).
 Under Union List of 7th Schedule, central government can make laws on shipping and navigation on inland
waterways which are classified as national waterways by Parliament by law.
 National Waterway (NW):
• What:
 waterways declared / notified under National Waterways Act, 2016
 To promote inland water transport (IWT) in India, about 111 inland waterways have been declared /
notified as National Waterways (NWs) under National Waterways Act, 2016.
• Example:
 NW 1:
o Ganga-Bhagirathi-Hooghly rivers
o From Allahabad to Haldia (WB)
o run through Ganges, Bhagirathi, Hooghly river system, with having fixed terminals at Haldia,
Farrakka (WB), Patna. Floating terminals at riverside cities like Kolkata, Bhagalpur (Bihar), Varanasi,
Allahabad.
o longest NW in India.
o Uttar Pradesh, Bihar, Jharkhand, West Bengal
 NW 2:
o Brahmaputra River (Assam)
o Brahmaputra River from Sadiya (Assam) to Dhubri (Assam).
o 3rd longest NW
o Assam only
 NW 3:
o West Coast Canal
o in Kerala
o runs from Kollam to Kottapuram.
o India’s 1st waterway with all-time navigation facility.
o It consists of West Coast Canal, Champakara Canal, Udyogmandal Canal.
 NW 4:
o connects Kakinada (AP) to Pondicherry.
o 2nd longest NW of India.
 NW 5:
o connects Odisha to West Bengal.
o runs through stretch on Brahmani River, East Coast Canal, Matai River, Mahanadi River.
o It handles traffic of cargo like coal, fertilizer, cement, iron.
 NW 6:
o proposed waterway in Assam.
o It will connect Lakhipur to Bhanga at River Barak.
o It will boost trade between Silchar (Assam) to Mizoram.
 NW16 – Barak River (Assam)
 NW 62 - Lohit River (Assam)
 NW 106 - Umngot River (Meghalaya)
 Inland Waterways Authority of India (IWAI) [1986]:
• statutory authority
• under Inland Waterways Authority of India Act, 1985
• in charge of waterways in India
• is implementing Jal Marg Vikas Project (JMVP) for capacity augmentation of navigation on waterways.
 Significance:
Page 22 of 719
 • IWT is fuel-efficient, environment-friendly mode, economical, environment friendly supplementary mode
of transport to rail and road.
Note:
 World Rivers Day:
→ One celebration of world’s waterways. It is celebrated on 4 th Sunday of September. It highlights many
values of rivers and strives to increase public awareness and encourages improved stewardship of rivers
around world.
 Marine Aids to Navigation Act, 2021:
→ What:
 Act to provide:
• for development, maintenance, management of aids to navigation in India;
• for training, certification of operator of aids to navigation, development of its historical, educational and
cultural value;
• for ensuring compliance with obligation under maritime treaties and international instruments to which
India is party.
 aids to navigation in India
 repeals Lighthouse Act, 1927 [law governing traditional navigation aid i.e. lighthouses]
→ Provisions:
 applies to whole of India, including maritime zones - territorial waters, continental shelf, exclusive economic
zone (EEZ).
 Union government will appoint Director General of Aids to Navigation. Director General of Aids to Navigation
will advise Union government on matters related to aids to navigation etc.
 Union government may appoint Central Advisory Committee (CAC) consisting of persons representing interests
affected by this Bill, or having special knowledge of navigation sector.
 Union government may consult CAC.
 Union government will be responsible for development, maintenance, management of all general aids to
navigation and vessel traffic services.
 No person shall be allowed to operate on any aid to navigation or any vessel traffic service in any place unless
he holds valid training certificate.
 Dispute redressal:
• to be decided by civil court.
→ Need:
 to provide appropriate statutory framework which reflects modern role of marine aids to navigation
 to be in compliance with India’s obligations under International Conventions.
→ Benefits:
 Improved legal framework
 Enhanced safety and efficiency of shipping.
 Skill development through Training and Certification.
 Marking of “Wreck” in general waters [to identify sunken / stranded vessels for safe and efficient navigation]
 Development of lighthouses [for purpose of education, culture, tourism and contribute to economy].
 Inland Vessels Act, 2021:
→ What:
 Act:
• to promote economical and safe transportation and trade through inland waters,
• to bring uniformity in application of law relating to inland waterwaysand navigation within India,
• to provide for safety of navigation, protectionof life and cargo, and prevention of pollution that may be
caused by useor navigation of inland vessels,
• to ensure transparency and accountability ofadministration of inland water transportation,
• to strengthen proceduresgoverning inland vessels, their construction, survey, registration, manning,
navigation.
Value Addition:
 Global commons:
→ international, supranational, and global resource domains in which common -pool resources are found.
→ Includes earth's shared natural resources - high oceans, atmosphere, outer space, Antarctic in particular.
→ Cyberspace may also meet definition of global commons.
Mains Link:
 Discuss the significance of National Waterways.
 “Rivers are the arteries of our planet; they are lifelines in the truest sense.” - Mark Angelo.

NATIONAL LAND MONETIZATION CORPORATION / NLMC [2022]

News:
Page 23 of 719
  2022:
→ Cabinet approves setting up of National Land Monetization Corporation as Special Purpose Vehicle (SPV) for
undertaking surplus land monetization.
About:
 What:
→ Special Purpose Vehicle (SPV) for undertaking surplus land monetization.
→ wholly owned Government of India company
 Functions:
→ NLMC will undertake monetization of surplus land, non-core assets.
→ NLMC will undertake building assets of CPSEs, other Government agencies.
→ NLMC is expected to own, hold, manage, monetize surplus land and building assets of CPSEs under closure and
surplus non-core land assets of Government owned CPSEs under strategic disinvestment.
 Need:
→ At present, CPSEs hold considerable surplus, unused, under-used non-core assets in nature of land and buildings.
For CPSEs undergoing strategic disinvestment or closure, monetization of these surplus land and non-core assets is
important to unlock their value. Thus, NLMC will support and undertake monetization of these assets.
→ NLMC will also advise and support other Government entities (including CPSEs) in identifying their surplus non-core
assets and monetizing them in professional and efficient manner to generate maximum value realization.
→ NLMC will undertake surplus land asset monetization as agency function.
→ It is expected that NLMC will act as repository of best practices in land monetization, assist and provide technical
advice to Government in implementation of asset monetization programme.
→ to professionally manage and monetize land assets on behalf of CPSEs and other Government agencies.
 Feature:
→ Assets may be transferred to NLMC to hold, manage and monetize said assets.
 Composition:
→ technical expertise
→ senior Central Government officers
→ eminent experts
 Significance:
→ With monetization of non-core assets, Government would be able to generate substantial revenues by monetizing
unused and under-used assets.
→ This will also enable productive utilization of under-utilized assets to trigger private sector investments, new
economic activities, boost local economy, generate financial resources for economic and social infrastructure.
→ Speed up closure process of CPSEs
→ smoothen strategic disinvestment process of Government owned CPSEs.
Mains Link:
 Discuss about the roles and functions of NLMC.

MOST FAVOURED NATION (MFN)

News:
 2022:
→ United States, European Union, Britain, Canada, Japan are planni ng to move jointly to revoke Russia’s
“most favoured nation” (MFN) status over its invasion of Ukraine.
About:
 What:
→ In international economic relations and international politics, most favoured nation (MFN) is status or level
of treatment accorded by one state to another in international trade.
→ It means country which is recipient of this treatment must nominally receive equal trade advantages as
"most favoured nation" by country granting such treatment (trade advantages include low tariffs, high
import quotas, etc). In effect, country that has been accorded MFN status may not be treated less
advantageously than any other country with MFN status by promising country.
→ Treatment accorded to trade partner to ensure non-discriminatory trade between two countries vis -a-vis
other trade partners.
 MFN and WTO:
→ Members of WTO agree to accord MFN status to each other.
→ Under WTO rules, member country cannot discriminate between its trade partners. If special status is
granted to one trade partner, it must be extended to all members of WTO.
→ Together with principle of national treatment, MFN is one of cornerstones of WTO trade law.
 Feature:
→ There is debate in legal circles whether MFN clauses in bilateral investment treaties include only
substantive rules or also procedural protections.

Page 24 of 719
 → Exceptions allow for preferential treatment of developing countries, regional free trade areas, customs
unions.
 MFN and preferential treatment:
→ In literal explanation, MFN doesn’t mean preferential treatment. Instead MFN means non -discriminatory
trade that ensures that country receiving MFN status will not be in disad vantageous situation compared
to granter’s other trade partners.
→ When one country receives MFN status, it is expected to lower trade barriers and decrease tariffs.It is also
expected to open up market to trade in more commodities and free flow of goods.
 Removal of MFN status:
→ There is no formal procedure for suspending MFN treatment and it is not clear whether members are
obliged to inform WTO if they do so.
→ India suspended Pakistan’s MFN status in 2019 after suicide attack by Pakistan -based Islamist group killed
40 police. Pakistan never applied MFN status to India.
 Advantage:
→ MFN status is extremely gainful to developing countries.
→ It provides access to wider market for trade goods.
→ It provides reduced cost of export items because of highly reduced tariffs and trade barriers.
→ Leads to more competitive trade.
→ Cuts down bureaucratic hurdles, tariffs and set at par for all imports.
→ It increases demands for goods and thereby giving boost to economy and export sector.
→ It heals negative impact caused to economy due to trade protectionism.
 Disadvantages:
→ Main disadvantage is that country has to give same treatment to all other trade partners who are members
of WTO.
→ This translates into price war and vulnerability of domestic industry as result.
→ Country is not able to protect domestic industry from cheaper imports produced by foreign companiesand
in this price war, some domestic players will face heavy losses or growth restrictions.
→ Local agricultural industry still can’t compete with subsidized US, EU markets.

PHOSPHORUS
News:
 2022:
→ Allegations of white phosphorus munitions being used by Russia and Ukraine are emerging.
About:
 What:
→ chemical element with symbol P and atomic number 15.
→ Elemental phosphorus exists in 2 major forms:
 white phosphorus
 red phosphorus
but because it is highly reactive, phosphorus is never found as free element on Earth.
→ It has concentration in Earth's crust of about 1 gram per kilogram.
→ In minerals, phosphorus generally occurs as phosphate.
 White phosphorus (WP) / yellow phosphorus / tetraphosphorus (P4):
→ What:
 Phosphorusmolecules made up of 4 atoms in tetrahedral structure. Tetrahedral arrangement results in ring
strain and instability.
→ Occurrence:
 It does not occur naturally. It is manufactured using phosphate rocks.
→ Feature:
 colourless, white or yellow, waxy solid.
 White phosphorus is translucent waxy solid that quickly becomes yellow when exposed to light. For this reason
it is also called yellow phosphorus.
 It glows greenish in dark (when exposed to oxygen).
 It is highly flammable and self-igniting upon contact with oxygen in air.
 It is toxic, causing severe liver damage on ingestion and phossy jaw from chronic ingestion or inhalation.
 White phosphorus is only slightly soluble in water and can be stored under water. Indeed, white phosphorus is
safe from self-igniting onlywhen it is submerged in water; due to this, unreacted white phosphorus can prove
hazardous to beachcombers who may collect washed-up samples while unaware of their true nature.
 It is soluble in benzene, oils, carbon disulfide, disulfur dichloride.
→ Regulation:
 Due to its combustible nature, every country has strict regulations regarding its manufacturing and handling.
Page 25 of 719
 → Concern:
 Unreacted white phosphorus (in sea, ocean) can prove hazardous to beachcombers who may collect washed-up
samples while unaware of their true nature.
→ Application:
 It is used mainly in military:
• White phosphorus is used in smoke, illumination, incendiary munitions.
• It is commonly burning element of tracer ammunition.
• It is highly efficient smoke-producing agent, reacting with air to produce immediate blanket of phosphorus
pentoxide vapour.
 Other applications may include as component in fertilisers, food additives, cleaning compounds.
 Initially, it was also used in pesticides and fireworks, but many countries have banned its use in many sectors.
→ White phosphorus munitions:
 What:
• weapons that use one of common allotropes of chemical element phosphorus.
• It burns fiercely; and can ignite cloth, fuel, ammunition, other combustibles.
• Smoke-producing white phosphorus munitions are very common, particularly as smoke grenades for
infantry, loaded in defensive grenade launchers on tanks, other armoured vehicles, and in ammunition
allotment for artillery and mortars. These create smoke screens to mask friendly forces' movement,
position, infrared signatures, shooting positions. They are often called smoke/marker rounds for their use
in marking points of interest, such as light mortar to designate target for artillery spotters.
 Is White Phosphorus munition incendiary (fire creating) or chemical weapon?
• White Phosphorus munition has not been categorised as incendiary or chemical weapon by international
agencies. Organisation for Prohibition of Chemical Weapons (OPCW), intergovernmental organisation and
implementing body for Chemical Weapons Convention, has not listed WP in any of 3 Schedules of Chemical
Weapons. However, UN considers WP as incendiary chemical.
• Protocol on Incendiary Weapons may apply or not apply when WP is used in military actions. It specifically
mentions this Protocol is not applicable on munitions that are illuminants, tracers, smoke or signalling
systems. Thus, it makes confusing for many if use of WP can be considered war crime or not. This Protocol
specifically does not ban use of WP in military action. It only restricts WP’s use near civilian population.
 Concern:
• Main reason behind WP being considered incendiary is its effect on humans. When WP comes in contact
with human skin, it can cause both thermal and chemical burns. It can produce several chemicals when it
comes in contact with skin, such as phosphorus pentoxide that reacts with water in skin and produces
phosphoric acid that is highly corrosive.
Note:
 Protocol on Incendiary Weapons [1983]:
→ Protocol on Prohibitions or Restrictions on use of Incendiary Weapons
→ UN treaty
→ It restricts use of incendiary weapons.
→ It is one Protocol to 1980 UN Convention on Certain Conventional Weapons .
 UN Convention on Certain Conventional Weapons [1980] / CCW / CCWC:
→ Convention on Prohibitions or Restrictions on Use of Certain Conventional Weapons
→ Prohibits or restricts use of certain conventional weapons which are considered excessively injurious or
whose effects are indiscriminate.
→ It covers land mines, booby traps, incendiary devices, blinding laser weapons, clearance of explosive
remnants of war.
→ India – party.

ALBERT EINSTEIN [1879 - ]

About:
 Who:
→ considered most influential physicist of 20th century.
→ He developed special and general theories of relativity.
→ won Nobel Prize in 1921 for Physics for explanation of photoelectric effect.
→ best known for developing theory of relativity.
→ He contributed to development of quantum mechanics .
 Theory of General Relativity:
→ This theory is leading theory about dark energy. It considers dark energy property of space.
→ Albert Einstein was 1 st to understand that space was not simply empty. He understood that more space
could continue to come into existence.

Page 26 of 719
 → In his theory of general relativity, Einstein included cosmological constant to account for stationary
universe other scientists thought existed.
→ After Hubble announced expanding universe, Einstein removed this cosmological constant from his general
relativity theory and called his constant his “biggest blunder.”
→ But, Einstein’s blunder may be best fit for dark energy. Predicting that empty space can have its own
energy, cosmological constant indicates that as more space emerges, more energy would be added to
universe, increasing its expansion.
Question:
 Predictions of Albert Einstein’s General Theory of Relativity include: Light is affected by gravity; Universe is constantly
expanding; Matter warps its surrounding space-time. Albert Einstein proposed 3 tests of general relativity, subsequently
called “classical tests” of general relativity, in 1916: Perihelion precession of Mercury’s orbit; Deflection of light by Sun;
Gravitational redshift of light (universe expansion). According to Einstein’s General Theory of Relativity, matter bends
fabric of space and time. Distortion of space-time continuum even affects behaviour of light. General relativity predicts
that path of light will follow curvature of spacetime as it passes near star. So, light will be affected by gravity.

HORTICULTURE
News:
 2021:
→ Ministry of Agriculture and Farmers’ Welfare provides allocation for Mission for Integrated Development
of Horticulture (MIDH).
 2022:
→ India’s Greenhouse Horticulture market held market value of USD 190.84 million in 2021 and is estimated
to reach USD 271.25 million by year 2030. This market is expected to register growth rate of 4.19% by 2030.
In 2021, India’s greenhouse horticulture production was 27.71 million tonnes.
About:
 What:
→ Term horticulture is derived from two Latin words hortus, meaning ‘garden’, and cultura meani ng
‘cultivation’. Hence it means, crops cultivated in garden cultivation.
→ It is science and art of production, utilisation, improvement of fruits, vegetables, flowers, other plants for
human food, non-food uses, social needs.
→ Art of cultivating plants in gardens to produce food ingredients, medicinal ingredients, or for comfort,
ornamental purposes.
→ M.H. Marigowda is considered Father of Indian Horticulture.
→ L.H. Bailey is considered Father of American Horticulture.
→ Horticulturists are agriculturists who grow:
 Flowers
 Fruits
 Nuts
 Vegetables
 Herbs
 ornamental trees
 lawns.
→ In order to conserve science of horticulture, many organizations worldwide educate, encourage, promote
advancement of horticulture. Some notable horticulturists include Luca Ghini, Luther Burbank.
 Genesis:
→ Study and practice of horticulture have been traced back thousands of years. Horticulture contributed to
transition from nomadic human communities to settlement, or semi -settlement, horticultural
communities.
 Type:
→ Horticulture is divided into many categories which focus on cultivation and processing of different types
of plants and food items for specific purposes.
 Status:
→ India is 2 nd -largest producer of fruits, vegetables in world, after China.
→ Horticultural crops constitute significant portion of total agricultural produce in India. They cover wide
cultivation area and contribute about 28% of GDP.
→ Horticultural crops account for 37% of total exports of agricultural commodities from India.
→ During 2019-20, India recorded its highest ever horticulture production of 320.77 million tonnes from area
of 25.66 million hectares.
 Challenge:
→ High post-harvest loss and gaps in post-harvest management [due to less or limited input by machinery
and equipment].

Page 27 of 719
 → Lack of supply chain infrastructures like cold storage, well -connected transport networks.
→ Difficulties in setting up due to higher input costs, limited availability of market intelligence.
→ No safety net provisions like MSP in case of foodgrains.
→ Production of horticultural commodities is far less as compared to existing demand in India.
 Intiative:
→ Mission for Integrated Development of Horticulture (MIDH).
→ Price Stabilization Fund (PSF) [2015] / Price Stabilisation Fund (PSF) [2015].
 Significance:
→ Diverse agro-climatic conditions in India ensure production of all types of fresh fruits, vegetables,
medicinal plants.
→ Horticulture crops perform vital role in Indian economy by generating employment, providing raw material
to many food processing industries, higher farm profitability due to higher production, export earnings
from foreign exchange.
→ Comparative production per unit area of horticultural crops is higher than field crops.
→ Horticulture crops are of high value, labour intensive, gene rate employment throughout year.
→ Horticulture has gained prominence over contributing growing share in Gross Value Addition (GVA) of
agriculture.
→ Horticulture crops are of national and international demand and are good source of foreign exchange.
→ Horticulture crops will role to serve India’s estimated demand of 650 MT of fruits, vegetables by year 2050.
Note:
 Price Stabilization Fund (PSF) [2015] / Price Stabilisation Fund (PSF) [2015]:
→ What:
 It is a corpus created by GOI to regulate price volatility of perishable agri-horticultural commodities such as
Onion, Potato, through procurement by State / UT Government and Central agencies of selected produce,
maintenance of buffer stocks and regulated release into the market. To begin with, interventions would be
supported for onions and potatoes only. However, other commodities may be added later
PSF was set up in 2014–15 with the aim of moderating extreme price volatility of commodities
such as Pulses, Onion and Potatoes by maintaining a strategic buffer. Such goods will be procured
directly from farmers or farmers’ organisations at the farm gate / mandi, and made available to
consumers at a more affordable price. PSF scheme provides interest-free loans to State Governments
/ Union Territories and Central Agencies for the procurement and distribution of such commodities.
PSF is under the Department of Consumer Affairs (Ministry of Consumer Affairs, Food and Public
Distribution).
→ Why:
 Prices of some of the horticulture commodities especially onion and potato are highly volatile. At the harvest
time and soon thereafter, a steep fall in the wholesale and retail prices is normally observed. With depletion of
the stored stocks, the prices tend to increase. This phenomenon is more apparent in the case of onions and
potatoes.
Price volatility affects consumers in a big way. Abnormal increase in price of these commodities affect
the consumers by way of increase in food consumption budget. Wide price fluctuations also lead to speculation
which further impact prices in retail market.
To mitigate hardships to consumers, a new central sector scheme for providing working capital and
other incidental expenses for procurement and distribution of perishable agri-horticultural commodities has
been approved. For this purpose, this corpus – “Price Stabilisation Fund” is being created.
→ Objective:
 To promote direct purchase from farmers / farmers’ associations at farm gate / Mandi.
 To maintain a strategic buffer stock that would discourage hoarding and unscrupulous speculation.
 To protect consumers by supplying such commodities at reasonable prices through calibrated release of stock.
 Greenhouse horticulture / Protected Cropping:
→ What:
 production of horticultural crops within, under or sheltered by structures for providing modified growing
conditions and/or protection from adverse weather, pests, diseases.
 one of most intensive agricultural systems, with advantages of environmental parameter control (temperature,
light, etc.), higher efficiency of resource utilization (water, fertilizers, etc.) and use of advanced technologies
(hydroponics, automation, etc.)
→ Status:
 India’s Greenhouse Horticulture market held market value of USD 190.84 million in 2021 and is estimated to
reach USD 271.25 million by year 2030. This market is expected to register growth rate of 4.19% by 2030. In
2021, India’s greenhouse horticulture production was 27.71 million tonnes.
 Growth driver:
• Robust increase in population and food demand.

Page 28 of 719
 • Rising entrepreneurship under horticulture due to government intervention.
 Mission for Integrated Development of Horticulture (MIDH):
→ What:
 Centrally Sponsored scheme for holistic growth and development of Indian horticulture sector.
→ Feature:
 It covers:
• vegetables
• fruits
• roots
• tuber crops
• aromatic plants
• flowers
• spices
• bamboo
• coconut
• cashew
• cocoa.
 It provides technical support and advice to:
• State horticultural missions
• Rashtriya Krishi Vikas Yojana (RKVY)
• Saffron Mission
• National Mission for Sustainable Agriculture (NMSA).
 Finance:
• North East States / Himalayan States:
 GOI contributes 90%
 State Governments contribute 10%
• Other States:
 GOI contributes 60%
 State Governments contribute 40%
 Its 5 sub-schemes:
• National Horticulture Mission (NHM).
• Horticulture Mission for North East & Himalayan States (HMNEH).
• National Horticulture Board (NHB)
• Coconut Development Board (CDB)
• Central Institute of Horticulture (CIH), Nagaland.
 National Horticulture Board (NHB) [1984]:
→ set on basis of recommendations of “Group on Perishable Agricultural Commodities”, headed by Dr M. S.
Swaminathan.
→ headquartered at Gurugram.
→ To improve integrated development of Horticulture industry and to help in coordinating, sustaining
production and processing of fruits and vegetables.
Mains Link:
 Discuss the significance of National Horticulture Mission.

MICROFINANCE
News:
 2022:
→ RBI releases new microfinance lending norms.
About:
 What:
→ Financial services targeting individuals, small businesses who lack access to conventiona l banking and
related services.
→ Microfinance is form of financial service which provides small loans and other financial services to poor
and low-income households.
→ Microfinance institutions (MFIs) are financial companies that provide small loans to people who do not have
any access to banking facilities.
→ Mmicrofinance loan is defined by RBI as ‘collateral-free’ loan granted to household with annual household income
of up to Rs 3 lakh.
→ RBI considers all collateral-free loans offered to low-income households as microfinance loans.
 Example:
→ Microcredit
Page 29 of 719
 → provision of small loans to poor clients
→ savings and checking accounts
→ microinsurance
→ payment systems
→ …
 Feature:
→ Microfinance services are designed to reach excluded customers, usually poorer population segments,
possibly socially marginalized, or geographically more isolated, and to help them become self-sufficient.
→ In India, all loans that are below Rs. 1 lakh can be considered as microloans.
→ Microcredit is delivered through many institutional channels:
 Scheduled Commercial Banks (SCBs), including small finance banks (SFBs), RRBs.
 Cooperative banks.
 NBFCs.
 Microfinance institutions (MFIs) registered as NBFCs.
→ Growth of microfinancing:
 In 1990s, microcredit was given by scheduled commercial banks (SCB) either directly or via non-governmental
organisations (NGO) to women’s SHGs, but given lack of regulation and scope for high returns, many for-profit
financial agencies such as NBFCs, MFIs emerged.
 By 2000s, there were widespread accounts of malpractices of MFIs and crisis in some States such as Andhra
Pradesh, arising rapid and unregulated expansion of private for-profit micro-lending.
 Microfinance crisis of Andhra Pradesh led RBI to review matter, and based on recommendations of Malegam
Committee, one regulatory framework for NBFC-MFIs was introduced in 2011.
 Few years later, RBI permitted new type of private lender, SFBs, with objective of taking banking activities to
“unserved and underserved” sections of population.
 Today, 31% of microfinance is provided by NBFC-MFIs, 19% by SFBs, 9% by NBFCs.
 These private financial institutions have grown exponentially over last few years, garnering high profits, and at
this pace, current share of public sector banks in microfinance (SHG-bank linked microcredit) of 41% is likely to
fall sharply.
Note:
 2022 RBI new microfinance lending norms.
→ Provision:
 All entities, banks, NBFCs, microfinance institutions (MFIs) are subject to same regulations.
 Microfinance loan is defined by RBI as ‘collateral-free’ loan granted to household with annual household income
of up to Rs 3 lakh.
 RBI considers all collateral-free loans offered to low-income households as microfinance loans.
 Financial entities should have board-approved policy to provide flexibility of repayment periodicity on
microfinance loans as per borrowers’ requirements. They should also have board-approved policy for
assessment of household income.
→ Significance:
 It shows RBI’s faith in maturity of microfinance sector.
 This is forward-looking step where responsibility is of institution to fix reasonable interest rate on transparent
terms.

BORDER AREA DEVELOPMENT PROGRAMME (BADP) [1986-87]

News:
 2021:
→ Some Arunachal Pradesh MLAs formed forum to prevent outmigration of villagers to urban areas for livelihood and
to modify Border Area Development Programme (BADP) to suit local needs.
 2022:
→ Report of department-related parliamentary standing committee on home affairs tabled in Parliament which
contains report about infrastructure on Indo-China border.
About:
 What:
→ Programme / schemeto develop border area near international boundary through infrastructure development and
to enable sustainable living, sense of security in border areas.
→ initiated in western region during 7thFive-Year Plan (1985-1990) and extended to other regions.
→ launched by Ministry of Home Affairsas part of comprehensive approach to Border Management.
 Objective:
→ to meet special developmental needs and wellbeing of people living in remote and inaccessible areas situated near
international border

Page 30 of 719
 → to saturate border areas with entire essential infrastructure through central/ state/ BADP/ local schemes and
participatory approach.
 Component:
→ construction of primary health centres
→ construction of schools
→ supply of drinking water
→ construction of community centres
→ connectivity
→ drainage
 Funding:
→ funds under BADP are provided to States as 100% non-lapsable Special Central Assistance (SCA).
 States covered:
→ Arunachal, Assam, Bihar, Gujarat, Himachal Pradesh, Jammu & Kashmir, Manipur, Meghalaya, Mizoram, Nagaland,
Punjab, Rajasthan, Sikkim, Tripura, Uttar Pradesh, Uttarakhand, West Bengal.
 Signficance:
→ Help in preparing border area residents as line of defence - scouting, information relay (Ex. herder reported
infiltration into Indian territory in Kargil War, 1999]
Note:
 Special Central Assistance (SCA) / Special Plan Assistance (SPA):
→ one component of Central Plan Assistance (CPA) or Central Assistance (CA)
→ provided for special projects and programmes (Western ghats, BADP etc)
→ given only to Special Category States to bridge gap between their planning needs and resources. That is, SCA / SPA
are Additional Central Assistance (ACA) for Special Category States.
 Central Plan Assistance (CPA) or Central Assistance (CA):
→ Financial assistance given by GOI to support States’ 5 Year Plans
 Additional Central Assistance (ACA):
→ one component of Central Plan Assistance (CPA) or Central Assistance (CA)
→ provided for implementation of externally aided projects (EAP)
→ types:
 one time ACA:
• assistance given by Planning Commission to particular State for State specific programmes and schemes.
• one time assistance and thus not recurring
• discretionary in nature
 Advance ACA:
• advances given to Special Category States
• given during financial stress
• recoverable in 10 years
Mains Link:
 Discuss the significance of BADP.
 Creation of infrastructure would help integrate border areas with the hinterland, create a positive perception of care by
the country and encourage people to stay on in the border areas leading to safe and secure borders. Discuss.

ARCTIC
News:
 2021:
→ India to participate in 3rd Arctic Science Ministerial (ASM3) – global platform for discussing research and
cooperation in Arctic region.
→ United States expresses concerns about military activities in Arctic.Military activities in Arctic increase
dangers or prospects of accidents.Military activities in Arctic undermines shared goal of peaceful and
sustainable future for Artic region.
→ 2021 Arctic Council meeting.
→ With lowering of Arctic summer ice, Clean Arctic Alliance urges International Maritime Organization (IMO) for urgent
cuts to black carbon (BC) emissions from shipping.
 2022:
→ Centre releases India’s Arctic Policy, with aim of enhancing India’s cooperation with this resource-rich and rapidly
transforming region, and to combat climate change and protect environment.
About:
 Arctic region:
→ Arctic Ocean and parts of:
 Canada
 Alaska (USA)

Page 31 of 719
  Greenland (Denmark)
 Sweden
 Norway
 Russia
 Finland
 Iceland
→ These countries together form core of Arctic Council.
 Arctic Council:
→ What:
 Intergovernmental forum
 addresses issues faced by Arctic governments and people living in Arctic region.
 established by1996 Ottawa Declaration.
 Not treaty-based international organization but rather international forum that operates on basis of consensus.
 Decisions, recommendations, guidelines of Arctic Council are non-enforceable and strictly depends on individual
state.
 Its mandate explicitly excludes military security.
→ Participants:
 According to 1996 Ottawa Declaration, members are:
• Canada
• United States
• Iceland
• Norway
• Sweden
• Denmark
• Finland
• Russian Federation.
 Permanent Participants are:
• 6 organizations representing Arctic indigenous peoples.
 Observer status:
• non-Arctic states [India has observer status]
• inter-governmental
• inter-parliamentary
• global orgs
• regional orgs
• non-governmental organizations.
 Pollution in Arctic:
→ Pollutants are found throughout arctic environment - in air, soil, sediments, snow, sea ice, glaciers,
seawater, fresh water, birds, mammals, people.
→ Air pollutants:
 Acid precipitation (nitrogen and sulphur compounds in atmosphere)
 Heavy metals (cadmium, mercury)
 Persistent Organic Pollutants (POPs)
 Significance / need for collaboration:
→ Arctic warming
→ Arctic ice melt.
→ Artic helps in:
 regulating climate
 regulating sea levels
 maintaining biodiversity.
 India:
→ History of India’s Arctic Reseach:
 India’s engagement with Arctic began one century ago with signing of Svalbard Treaty, 1920 in Paris in 1923 by
British India Govt.Ever since then, India has been closely monitoring all developments in Arctic region.
 In 2007, India initiated its Arctic research program and sent its 1st scientific expedition to Arctic. It focussed
on climate change in Arctic region. Objectives included studying teleconnections between Arctic climate and
Indian monsoon, to characterize sea ice in Arctic using satellite data, to estimate effect on global warming.
 In 2008, India estd. permanent research station - Himadri - in Svalbard, Arctic.
 In 2013, India gets Observer Status in Arctic Council.
 In 2014, India deployed IndARC observatory.
 In 2016, India set up Gruvebadet observatory.

Page 32 of 719
→ India’s Arctic Mission:
 To enhance India’s cooperation with Arctic region.
 To harmonise polar research with 3rd pole – Himalayas.
 To contribute to efforts to enhance humankind’s understanding of Arctic region.
 To strengthen international efforts on combating climate change and protection of environment.
 To advance study and understanding of Arctic within India.
→ India’s scientific research expedition to Arctic:
 India sends scientific research expedition to Arctic to study:
• Glaciology
• Hydrochemistry
• Microbiology
• atmospheric sciences.
 research in Arctic region is conducted under Ministry of Earth Sciences (MoES).
 NISAR (NASA-ISRO Synthetic Aperture Radar) satellite mission is underway.
 India also contributes to Sustained Arctic Observational Network (SAON)
→ India’s Arctic Policy / Arctic Policy of India [2022]:
 Background:
• In 2022, Centre released India’s Arctic Policy, with aim of enhancing India’s cooperation with this resource-
rich and rapidly transforming region.
 Need:
• Relevance of Arctic for India can be broadly explained under below categories:
 Scientific Research, Climate Change, Environment:
o Monsoons:
✓ Changes occurring in Arctic are yet to be understood fully. But it is clear that they have been
impacting global weather, climate, ecosystems including monsoons in India.
✓ During monsoons, India receives over 70% of its annual precipitation. India’s agriculture, which
is primary source of livelihood for about 58% of India’s population and contributes around 20%
to GDP,is directly dependent on monsoons.
o Rising Sea Level:
✓ Ice loss in Arctic is major contributor to global sea-level rise. It can have significant impact on
India, especially over its 1,300 island territories, maritime features.
o Himalayas:
✓ Arctic and Himalayas, though geographically distant, are interconnected and share similar
concerns. Arctic meltdown is helping scientific community to better understand glacial melt in
Himalayas, which has often been referred to as ‘3rdpole’ and has largest freshwater reserves
after North and South poles.
✓ Study of Arctic is therefore critical to Indian scientists.
 Economic and Human Resources:
o Mineral Resources and Hydrocarbons:
✓ Arctic region has rich deposits of coal, gypsum, diamonds and also substantial reserves of zinc,
lead, placer gold, quartz.
✓ Greenland alone possesses about 1/4 of world’s rare earth reserves.
✓ India is 3rd-largest energy-consuming country in world, 3rd-largest oil importer (8%) and
4thlargest importer of gas which amounts to almost 1/2 of total gas consumption.
✓ Arctic can therefore potentially address India’s energy security needs, deficiency of strategic
and rare earth minerals.
 Indian Arctic policy is built on 6 central pillars:
• Science and Research
• Economic and Human Development Cooperation
• Climate and Environmental Protection
• Transportation and Connectivity
• Governance and International Cooperation
• National Capacity Building
 Highlight:
• This policy commits to expanding scientific research, “sustainable tourism” and mineral oil and gas
exploration in Arctic region.
• It spells out goals in India’s Arctic Mission such as to better understand scientific and climate-related
linkages between Arctic and Indian monsoons.
• It also seeks to harmonise polar research with 3rdpole (Himalayas) and to advance study and understanding
of Arctic within India.

Page 33 of 719
 • This policy calls for exploration opportunities for responsible exploration of natural resources and minerals
from Arctic and identifying opportunities for investment in Arctic infrastructure in areas such as offshore
exploration/mining, ports, railways, airports.
• Strengthening national capabilities and competencies in science and exploration, climate and
environmental protection, maritime and economic cooperation with Arctic region. Institutional and human
resource capacities will be strengthened within Government and academic, research and business
institutions.
• Inter-ministerial coordination in pursuit of India’s interests in Arctic.
• Enhancing understanding of impact of climate change in Arctic on India’s climate, economic, energy security.
• Contributing better analysis, prediction, coordinated policymaking on implications of ice melting in Arctic
on India’s economic, military, strategic interests related to global shipping routes, energy security,
exploitation of mineral wealth.
• Studying linkages between polar regions and Himalayas.
• Deepen cooperation between India and countries of Arctic region under many Arctic forums, drawing
expertise from scientific and traditional knowledge.
• Increase India’s participation in Arctic Council and improve understanding of complex governance structures
in Arctic, relevant international laws, geopolitics of Arctic region.
 Importance / Does it address gaps?
• Scientific Orientation:
 India’s Arctic Policy has gone beyond purely scientific approach. While primary focus is still scientific,
its 6 pillars address all aspects of Arctic relevant to India, including climate change, environment,
economic resources, human resources, geopolitical and strategic aspects. This would likely make India’s
engagement with Arctic more broad-based and enable holistic approach.
• Funding:
 This Policy declares that its implementation will be based on allocation of requisite resources. With
enhancement of multidisciplinary approach to Arctic, it is hoped that budgetary support to India’s
scientific Arctic endeavours will be substantially augmented.
• Polar Research Vessel:
 Intent articulated in Arctic Policy of acquiring dedicated ice-class Polar Research Vessel will fastened
process and provide impetus to India’s Arctic Programme.
• Whole-of-Government Focus:
 Objectives outlined in India’s Arctic Policy are to be implemented through Action Plan and governance
and review mechanism consisting of inter-ministerial Empowered Arctic Policy Group (EAPG). This
mechanism is likely to enable better analysis, prediction, coordinated approach in Government of India,
lend policy coherence to Arctic region and will result in better realisation of India’s strategic, military,
economic interests.
 Conclusion:
• On whole, India’s Arctic Policy is timely and is likely to provide direction to India’s policy-makers on India’s
engagement with Arctic region. It is 1ststep towards developing whole-of-government approach on India’s
engagement with Arctic region.
• This Policy is likely to have multiplier effect towards more synergised and focused scientific research
including enhanced understanding of linkages between monsoons and climate change in Arctic, and
between polar studies and Himalayas.India’s Arctic Policy is in synergy with broader policy framework of
Government of India.
→ Arctic significance for India:
 Arctic influences atmospheric, oceanographic and biogeochemical cycles of Earth’s ecosystem.
 Climate change causes loss of sea ice, ice caps, warming of ocean that in turn impacts global climate.
 Frigid Arctic, which keeps losing ice due to global warming, is one of batteries feeding variations in Indian
monsoons.
Note:
 Svalbard Treaty, 1920:
→ recognises sovereignty of Norway over Arctic archipelago of Svalbard - located between mainland Norway and North
Pole.
 Clean Arctic Alliance:
→ Composition:
 Many not-for-profit organisations
→ Aim:
 to protect arctic from impacts of shipping
→ What it does:
 It campaigns to persuade governments to take action to protect Arctic, its wildlife, its people.
→ Area:

Page 34 of 719
  Black Carbon
 GHG emissions
 Heavy Fuel Oil
 Scrubbers and their effluents
 Underwater noise
 Arctic Science Ministerial (ASM):
→ global platform for enhancing collective understanding of Arctic region, for constant monitoring, for
observations.
Mains Link:
 The frigid Arctic, which keeps losing ice due to global warming, is one of the batteries feeding the variations in
Indian monsoons. Discuss.
 Discuss the issues associated with militarisation of the Arctic.
 Discuss the strategic significance of Arctic region.
 The recent Arctic Policy has overcome the gaps in earlier related Interventions of India. Do you agree? Comment

FLY ASH / FLUE ASH / PULVERISED FUEL ASH

News:
 2020:
→ NTPC Ltd., under Ministry of Power,collaborates with cement manufacturers to supply fly ash, so as to achieve 100%
utilisation target of by-product produced during its power generation.
→ NTPC to sale its residual product - fly ash - to West Asia etc.
 2022:
→ NGT directs centre to constitute ‘Fly Ash Management and Utilization Mission’.
→ NGT decides to club ongoing cases on fly ash mismanagement and accidents filed. [This is significant
acknowledgement of India’s fly ash crisis and could guide in better regulations to govern fly ash.
→ MoEFCC issues directives to form one committee for surveillance of pollution problems caused by Koradi coal-fired
power plants (Koradi Thermal Power Station, Nagpur)and Khaperkheda coal-fired power plant (Khaperkheda
Thermal Power Station, Nagpur) in Nagpur. Both plants are also directed to ensure 100% utilization of fly-ash.
About:
 What:
→ by-product of coal combustion.
→ coal combustion product
 Composition:
→ particulates that are driven out of coal-fired boilers, along with the flue gases.
→ Includes:
 Silicon dioxide (SiO2);
 Aluminium oxide (Al2O3); and
 Iron Oxide
 Calcium oxide (CaO) - main mineral compounds in coal-bearing rock.
→ Minor constituents:
 arsenic
 cadmium
 chromium
 lead
 mercury
 unburnt carbon etc.
 Production:
→ Coal power plants. During coal combustion, large amounts of ash are created along with CO2 and other gases. Fine
particle ash that rises up with flue gases is known as fly ash / flue ash while heavier ash that does not rise is called
bottom ash. Fly ash and bottom ash collectively are known as coal ash.
 Impact:
→ Health hazards and environmental hazards:
 Toxic heavy metals- nickel, cadmium, arsenic, chromium, lead, etc
 Radiation – fly ash contains more radiation than nuclear waste, for equal amount of electricity generation.
 Water pollution:
• Ash spills occur frequently in India which pollute large water bodies.
 destruction of mangroves
 reduction in crop yields
 pollution of groundwater
• Example – Fly Ash pollution in groundwater in Rann of Kutch from Ash sludge of adjoining Coal power plants.
 Usage:
Page 35 of 719
 → Concrete production - as a substitute material for Portland cement, sand.
→ Embankments and other structural fills.
→ Cement production – as a substitute material for clay.
→ Stabilization of soft soils.
→ Road construction.
→ In brick production.
→ Agricultural uses:
 Fertilizer etc.
→ Loose application on rivers to melt ice.
→ Ice control on roads and parking lots.
 Policy:
→ Ministry of environment, forest and climate change (MoEFCC) had set norms that thermal plants should utilise 100%
of fly ash.
→ Fly Ash Management and Utilization Mission:
 Background:
• In 2022, NGT directed centre to constitute ‘Fly Ash Management and Utilization Mission’ so as to streamline
monitoring and coordination of all issues regarding handling and disposal of fly ash in MP, and UP,
comprising secretaries from Ministries of Environment, Coal and Power and chief secretaries of MP and UP
States.
 Function:
• preparation of action plan based on findings of many committees, including plugging big gap in storing,
handling, management and utilisation of fly ash.
• Its fund will act as environmental restoration and compensation fund responsible for relief compensation
for affected people.
 Funding:
• This mission will be financed through CSR funds.
Mains Link:
 What is fly ash? What are its effects on human health and environment?

MERCURY (HG)
(GS1, GS3)
News:
 2021:
→ New study by University of Maryland, USA revealed that Mercury has big-sized core relative to its mantle:
 Reason:
• Sun’s magnetism:
 During early formation of solar system, when young Sun was surrounded by cloud of dust and gas,
grains of iron were drawn toward centre by Sun’s magnetic field.
 When planets began to form from said dust and gas, planets closer to Sun incorporated more iron into
their cores than those planets further away.
→ High concentrations,far higher than in average river, of mercury are found in water bodies fed by Greenland
Ice Sheet.
 Reason:
• Unlike most contaminants caused by industries or other anthropogenic activities, mercury contamination
of water bodies fed by Greenland Ice Sheet are caused by weathering of Mercury-rich bedrock, during slow
movement of glaciers down slope of hills, and accommulation into streams when glacier melts.
 Significance of discovery:
• We now understand that even glaciers carry potential toxins – Hg etc.
• This discovery will make researchers to study about toxins in glaciers and potentially come up with
remedies.
• It will help us understand glaciers toxins’ influence on Earth’s geochemical and biological processes.
 2022:
→ Consensus is building among stakeholders meeting in Bali, Indonesia, to adopt one non-binding declaration that will
enhance international cooperation and coordination for combating illegal trade in mercury globally.Government of
Indonesia and UN seek support and commitment from parties to Minamata Convention for Bali Declaration on
combating Global Illegal Trade of Mercury.
About:
 What:
→ Element with atomic no. 80.
→ commonly known as quicksilver
→ naturally occurring element (found in air, water, soil)

Page 36 of 719
 Sources:
→ Nature (found in soil, air, water)
→ Mercury is present in Earth's crust and in various forms on Earth’s surface.
→ Mercury is released into air through natural processes such as weathering of rocks, volcanic eruptions, geothermal
activities, forest fires, etc.
→ Mercury is also released through human activities.
 Toxic effects:
→ Hg has toxic effects on:
 nervous system
 digestive system
 immune system
 lungs
 kidneys
 skin
 eyes.
→ Minamata Disease:
 Disorder caused by Mercury poisoning.
 1st detected in inhabitants of Minamata Bay, Japan [caused by eating fish contaminated with mercury from
industrial wastes].
 Mercury Cycle:
→ Intro / What:
 Mercury cycles from Earth to Atmosphere to Oceans and back to Earth.
 Mercury cycle is biogeochemical cycle that transforms mercury through multiple chemical forms and
environments.
 is influenced by natural processes and anthropogenic processes.
→ How:
 Earth to atmosphere:
• Weathering of rocks
• vegetation uptake, then biomass burning, food chain
• volcanic eruption (magma)
• geothermal activities
• forest fires
• anthropogenic emission (ores, coal industries).
• warming of permfrost.
• Emissions from some bacteria
 Atmosphere to Ocean:
• Dry deposition of Mercury Oxide.
• Wet and Dry deposition of Mercury
• River flow
 Ocean to Earth:
• Sedimentation
• Burial
• Accommulation inside fish etc.
• Emissions from some bacteria
→ Food chain:
 Plants -> Human
 Marine food (fish etc.) -> Human
 Concerns:
→ Mercury Pollution:
 Mercury is major pollutant in world.
 WHO considers Mercury as among top 10 chemicals of major public health concern.
 Mercury emissions from climatically sensitive environments like glaciers (2021 Greeland Ice Sheet Hg emission):
• will be much more difficult to manage, than contemporary Hg emissions from direct anthropogenic
activities like industry etc.
• will increase water / ocean pollution taking into account today’s global warming-induced metling of ice-
sheets, glaciers.
 International efforts:
→ Minamata Convention on Mercury, 2013:
 UN treaty i.e. global treaty to protect human health and environment from adverse effects of mercury and its
compounds.

Page 37 of 719
  Key obligation:
• Controlling anthropogenic releases of mercury throughout its lifecycle.
 It also addresses:
• interim storage of mercury
• Hg its disposal once it becomes waste
• sites contaminated by mercury
• mercury related health issues.
→ Potential Bali Declaration on combating Global Illegal Trade of Mercury:
 It calls upon Minamata parties to develop practical tools, notification, information-sharing systems for
monitoring and managing trade in mercury.
 Exchange experiences and practices relating to combating illegal trade in mercury, including reducing use of
mercury in artisanal and small-scale gold mining.
 Sharing of examples of national legislation and data and information related to such trade.
 India efforts:
 India ratified Minamata Convention on Mercury, 2013.
Mains Link:
 Write a note on mercury contamination and discuss international efforts to address the issue.

CRYOSPHERE
News:
 2022:
→ Polar Science and Cryosphere Research (PACER) schemeapproved for continuation upto 2026.
About:
 What:
→ all-encompassing term for portions of Earth's surface where water is in solid form, including sea ice, lake
ice, river ice, snow cover, glaciers, ice caps, ice sheets, frozen ground (which includes permafrost).
→ frozen water part of Earth system.
→ places on Earth that are so cold that water is frozen solid. These areas of snow or ice, which are subject to
temperatures below 0°C for at least some part of year, compose cryosphere.
→ Term “cryosphere” means cold.
 Feature:
→ Approximately 10% of Earth's surface is covered by ice.
→ It overlaps with hydrosphere.
→ Cryosphere is integral part of global climate system with important linkages, feedbacks generated through
its influence on surface energy, moisture fluxes, clouds, precipitation, hydrology, atmospheric circulation,
oceanic circulation.
 Components:
→ Ice, snow on land:
 This includes continental ice sheets found in Greenland, Antarctica, ice caps, glaciers, snow, permafrost.
 When continental ice flows/extends out from land to sea surface, we get shelf ice.
→ Ice on water:
 This includes permafrost under water but on sea surface, sea ice, iceberg, frozen parts of ocean, such as waters
surrounding Antarctica, Arctic.
 It also includes frozen rivers, frozen lakes, which mainly occur in polar areas.
 Concern:
→ Approximately 10% of Earth's surface is covered by ice, but this is rapidly decreasing.
 Significance:
→ Through feedback processes, cryosphere plays significant role in global climate, global climate model
response to global changes.
→ Snow, ice reflect heat from sun, helping to regulate our planet’s temperature.
→ Because polar regions are some of most sensitive to cli mate shifts, cryosphere may be one of 1 st places
where scientists are able to identify global changes in climate.
 Note:
→ Deglaciation describes retreat of cryospheric features.
→ Cryology is study of cryospheres.
 India:
→ Polar Science and Cryosphere Research (PACER) scheme:
 What:
• Research and Development program to improve our understanding of Polar Science and cryosphere system.
• Ministry of Earth Sciences (MoES)
 Objective:
Page 38 of 719
 • To improve our understanding of Polar Science and cryosphere system.
 Focus:
• Earth Atmosphere Science
• Environment Science
 Components:
• Construction of polar research vessel.
• Construction of 3rdresearch base in Antarctica
• Indian scientific endeavours in Arctic
• Polar expeditions-Antarctica
• Replacement of Maitri station
• Southern Ocean
 Feature:
• It comprises:
 Indian Arctic program
 Antarctic program
 Southern Ocean program
 Cryosphere and Climate program
• implemented through National Centre for Polar and Ocean Research (NCPOR) [autonomous institute under
Ministry of Earth Sciences].
 Achievements:
• Executed 39th & 40th Indian Scientific Expedition to Antarctica.
• 41st Indian Scientific Expedition to Antarctica is ongoing.
• Clear-air atmospheric observatories containing automatic weather stations (sensors to measure aerosol and
GHG concentrations) has been established at Maitri station, Bharati station.
• 23 research projects related to glaciology, marine science, polar biology, atmospheric science were
successfully carried out during 2019-20 Arctic Expedition.
• IndARC mooring system along with Hydrophone system was successfully retrieved and deployed in
Kongsfjorden, Svalbard.
• Glaciological field campaigns were carried out in some benchmark glaciers in Chandra basin of Lahaul-Spiti
region of Western Himalaya, India.

EARTH HOUR [2007]

News:
 2022:
→ Earth Hour observed digitally as many countries are in Covid lockdown.
About:
 What:
→ worldwide movement / event organized by World Wildlife Fund (WWF).
→ held annually
→ climate change initiativewhere people reduce their electricity usage.
→ famous environmental initiative.
→ encourages individuals, communities, businesses to turn off non -essential electric lights, for 1 hour, from
8:00 pm to 9:00 p.m. on last Saturday of March, as symbol of commitment to planet.
→ Occasionally, in years when Holy Saturday falls on last Saturday of March, Earth Hour is moved 1 week
early rather than its usual date.
 Genesis:
→ It started as lights-off event in Sydney, Australia, in 2007.
 Objective:
→ With Earth Hour, WWF aims to engage people across globe to adopt more sustainable lifestyle. Turning off
lights for 1 hour is just annual reminder that if world does not mend its ways, it will be heading to dark
age, literally.
 Need:
→ Global warming and climate change have dominated scientific debate. With ever rising population of world,
climate change has put humankind, other species at great risk.
→ Global warming, rising levels of pollution due to ever increasing industrialisation, declining forest cover,
rising sea levels are some of dangers that drastically affect workings of life on earth.
 Significance:
→ It raises awareness about serious issues impacting our world today.
→ To help reduce effect of global warming, raise awareness for climate change and wildlife conservation.

Page 39 of 719
 → Since 2007, it has grown to engage more than 7000 cities and towns worldwide. Today, Earth Hour engages
massive mainstream community on broad range of environmental issues. This 1 -hour event continues to
remain key driver of now larger movement.
→ Though largest polluters are big industries, WWF tries to make masses more and more aware about
dangers of adverse climate so that they could put pressure on respective governments to frame
environment-friendly policies and laws.
 2022Earth Hour:
→ Topic - “Shape Our Future.”
Note:
 Earth Day [1970]:
→ What:
 annual event on April 22 to demonstrate support for environmental protection.
 It now includes wide range of events coordinated globally by EarthDay.org (formerly Earth Day
Network)including about 1 billion people in more than 193 countries.
 2022 theme – “Invest In Our Planet”.
 Earth Day is celebration of our natural environment by inspiring people to plant trees, recycle
regularly, keep planet tidy.
→ Origin:
 1969 Santa Barbara Oil Spill, California
 Earth Hour vs Earth Day:
→ Earth Hour stands as climate change initiative where people reduce their electricity usage .
→ Earth Day celebrates our natural environment by inspiring people to plant trees, recycle regularly, keep
planet tidy.
 April 22:
→ Earth Day [1970]
→ International Mother Earth Day [2009]
→ 2015 Paris Agreement got signed
Mains Link:
 Discuss the significance of Earth Day.
 Earth Day – observed in commemoration of 1969 Santa Barbara Oil Spill, California, USA.

RHINO
News:
 2021:
→ Under Indian Rhino Vision 2020 (IRV 2020), one -horned rhinos were translocated from Pobitora Wildlife
Sanctuary, Assam and Kaziranga National Park, Assam to Manas National Park, Assam.
→ Assam marked World Rhino Day with special ceremony by burning stockpil e of nearly 2,500 horns of one-
horned rhinoceros. [This is milestone towards rhino conservation and is aimed at busting myths about
rhino horns. Itis loud and clear message to poachers, smugglers that such items have no value].
 2022:
→ Over last 4 years, population of one-horned rhinoceros increased by 200 in Assam’s Kaziranga National
Park and Tiger Reserve, and is now about 2613.
About:
 One-horned rhino / Indian rhino:
→ What:
 also known as Indian rhino / great Indian rhino / great one-horned rhino / greater one-horned rhino
 One-horned rhino is only rhino speciesfound in India.
 largest of rhino species.
 Herbivore
 single black horn and grey-brown hide with skin folds
→ Protection Status:
 IUCN - VU
 CITES - Appendix I
 Wildlife Protection Act, 1972 - Schedule I.
 Included under Integrated Development of Wildlife Habitats (IDWH), 2008-09
→ India:
 Rhinos are mainly found in State of Assam:
• Pobitora Wildlife Reserve, Assam
• Kaziranga National Park, Assam
• Manas National Park, Assam
• Rajiv Gandhi Orang National Park, Assam
Page 40 of 719
  Conservation efforts:
• “New Delhi Declaration on Asian Rhinos 2019”:
 Rhino range nations:
o India
o Nepal
o Bhutan
o Indonesia
o Malaysia
signed this declaration for conservation and protection of Rhino species.
• Rhino DNA profiling:
 MoEFCC began project to create DNA profiles of all rhinos in country.
• National Rhino Conservation Strategy 2019:
 Conservtion of greater one-horned rhinoceros in country.
• India is signatory to CITES. Thus, it is illegal to sell horns in India.
• Indian Rhino Vision (IRV) 2020:
 Introduction (initiative) of rhinos in new areas of Assam to increase rhino population in Assam by year
2020.
 led by:
o Forest Department, Government of Assam
o partnership with World Wide Fund for Nature (WWF) India, International Rhino Foundation etc.
 Goal:
o By year 2020, increase rhino population in Assam by establishing Rhino populations in new areas.
Mains Link:
 Write a note on IRV 2020.

AZADI KA AMRIT MAHOTSAV / INDIA @75 PROJECT

News:
 2021:
→ Ministry of Jal Shakti begins ‘SUJALAM’ campaign, as part of Azadi Ka Amrit Mahotsav.
→ Ministry of Education launches YUVA scheme, as part of Azadi Ka Amrit Mahotsav
 2022:
→ Government decides that books selected under PM-YUVA Scheme be translated into different Indian languages to
ensure exchange of Indian culture and literature in order to promote `Ek Bharat Shreshtha Bharat’.
About:
 initiative of Government of India to celebrate and commemorate 75 years of progressive India and glorious history of it’s
people, culture and achievements.
 dedicated to people of India who have not only been instrumental in bringing India thus far in it’s evolutionary journey
but also hold within them power and potential to activating India 2.0, fuelled by spirit of Atmanirbhar Bharat.
 Visible form of all that is progressive about India’s socio-cultural, political and economic identity.
 Official journey of “Azadi ka Amrit Mahotsav”:
→ commences on 12th March, 2021, which starts 75 week countdown to 75th anniversary of Independence; and
→ will end on 15th August, 2022.
Note:
 Ek Bharat Shreshtha Bharat programme:
→ to enhance interaction & promote mutual understanding between people of different States/UTs through concept
of State/UT pairing.
→ States carry out activities to promote sustained and structured cultural connect in areas of language learning, culture,
traditions & music, tourism & cuisine, sports and sharing of best practices, etc.
Mains Link:
 Discuss the significance of the scheme.

APRIL, 2022
CORE SECTOR / CORE INDUSTRIES
News:
 2021:
→ In September, 2021, output from India’s 8 core sectors grew by about 9.5%.
About:
 8 core sector industries
 About 40% of weight of items included in Index of Industrial Production (IIP).
 weightage in IIP, decreasing order:
→ Refinery Products
→ Electricity
Page 41 of 719
 → Steel
→ Coal
→ Crude Oil
→ Natural Gas
→ Cement
→ Fertilizers.
Note:
 Index of Industrial Production (IIP):
→ index which details out growth of various sectors in economy - mining, electricity, manufacturing etc.
→ composite indicator that measures short-term changes in volume of production of basket of industrial products
during given period with respect to that in chosen base period.
→ compiled and published monthly by Central Statistical Organisation(CSO)
Mains link:
 Discuss the policies that is required to increase the core sector growth in the country.

GOOD MANUFACTURING PRACTICE (GMP)

News:
 2022:
→ WHO suspends Covid-19 vaccine Covaxin’s supply through UN agencies, after inspection flagged issues relating to its
manufacturing.
 Background:
• Covaxin had got Emergency Use Listing (EUL) from WHO in 2021 as it met standards set by WHO for
protection against coronavirus disease. WHO’s EUL is also one prerequisite for any vaccine to be part of
supply under COVAX initiative. This WHO licence thus paved way for Bharat Biotech to supply Covaxin to
UN agencies including through COVAX intiative.
 Reason / issue:
• At time EUL for Covaxin was granted, WHO had not done inspection. In 2022, inspection was done, and
based on which WHO suspends supply of Covaxin through UN procurement agencies. In this inspection,
WHO found deficiencies in good manufacturing practices (GMP).
About:
 What:
→ practices required in order to conform to guidelines recommended by agencies that control authorization and
licensing of manufacture and sale of food and beverages, cosmetics, pharmaceutical products, dietary supplements,
medical devices.
→ These guidelines provide minimum requirements that manufacturer must meet to assure that their products are
consistently high in quality, from batch to batch, for their intended use.
→ system for ensuring that products are consistently produced and controlled according to quality standards.
→ It is designed to minimize risks involved in any pharmaceutical production that cannot be eliminated through testing
final product.
 Objective:
→ Rules that govern each industry may differ significantly; however, main purpose of GMP is always to prevent harm
from occurring to end user.
→ ensuring end product is free from contamination
→ ensuring that it is consistent in its manufacture
→ ensuring that its manufacture is well documented
→ ensuring that personnel are well trained
→ ensuring that product is checked for quality.
 How:
→ Effective use of quality management system (QMS).
 Note:
→ More than 100 countries have incorporated WHO GMP provisions into their national medicines laws, and many more
countries have adopted its provisions and approach in defining their own national GMP requirements.
→ GMP, along with Good Agricultural Practices, Good Laboratory Practices and Good Clinical Practices are overseen by
regulatory agencies in UK, USA, Canada, Europe, China, India etc.
Note:
 World Health Organization – Good Manufacturing Practices (WHO-GMP):
→ also referred to ‘current Good Manufacturing Practice’ (cGMP)
→ aspect of quality assurance that ensures that medicinal products are consistently produced and controlled to quality
standards appropriate to their intended use and as required by product specification.
→ GMP also has legal components, covering responsibilities for distribution, contract manufacturing and testing,
responses to product defects and complaints.

Page 42 of 719
 → WHO GMP continues to be used as basis for WHO Certification Scheme and prequalification of vaccines for
procurement by UN agencies.

PAKISTAN OCCUPIED KASHMIR (POK)

News:
 2017:
→ Pakistan proposed to declare Gilgit-Baltistan (GB) region as its 5th province.
 2020:
→ Pakistan Supreme Court allowed / upheld amendment to Government of Gilgit-Baltistan Order, 2018 to conduct
general elections in Gilgit-Baltistan region.
→ Pakistan Supreme Court directed advocate general of Gilgit-Baltistan to establish caretaker government in Gilgit-
Baltistan.
→ Indian government via DD, AIR began weather forecasts for regions under Pakistan Occupied Kashmir
(POK). In return, Radio Pakistan also featured updates from Srinagar, Pulwama, La dakh.
→ Pakistan decided to elevate Gilgit-Baltistan to status of full-fledged province.
 2021:
→ Elections to be held in Pakistan Occupied Kashmir (POK).
→ Pakistan finalised law to award provisional provincial status to Gilgit -Baltistan.
 Implication:
• GB election commission is likely to be merged with Election Commission of Pakistan.
• GB will become 5th province of Pakistan
• Currently, Pakistan has 4 provinces - Balochistan, Khyber Pakhtunkhwa, Punjab, Sindh.
→ Protesters took to streets of Pallandari region, Pakista n-occupied Kashmir (PoK) demanding independence
from Pakistani clutches.
 Reason:
• Accusing Islamabad of giving 2 nd -class citizen treatment to them for past decades, protestors said
their rights were violated.
• Additionally, Pakistan’s administration is also accused of exploiting citizens politically and
economically.
→ In violation of international laws, Pakistan is exploiting scope of uranium enrichment in Pakistan -occupied
Gilgit-Baltistan [confirmed by locals and political activists].
 2022:
→ People of POK condemns Pakistan for observing 5 th February as Kashmir Solidarity Day and on contrary
marked it as “Fraud Day”. Many protest rallies are held across PoK where POK people criticize Islamabad
for its double standards on Kashmir. (POK region does not have proper healthcare, educational facilities
compared to Islamabad.)
→ Local communities of valleys in Gilgit-Baltistan are protesting against Pakistan for forcibly taking village
lands and plundering their natural wealth. [Earlier, large number of people came out into streets protesting
against Pakistan government’s decision to issue licenses to private contractors for mining gems ].
About:
 What:
→ Area / region of JK (India) that came into being after 1949 ceasefire (after 1 st Kashmir War, 1947) between
India and Pakistan.
→ referred by UN, international organizations as - Pakistani-controlled Kashmir / Pakistan Administered
Kashmir.
→ re-named as Pakistan Occupied Jammu-Kashmir by Hon’ble Modi’s government (India).
 Consists of:
→ Gilgit-Baltistan (Gilgit – NW, Baltistan – SE):
 Location:
• It borders China in North, Tajikistan in NW, Afghanistan in west, Kashmir in SE.
• Pakistan sees it separate from POK.India considers GB as part of undivided JK.
• It has regional Assembly and elected Chief Minister.
• CPEC passes through this region.
 History:
• GB was part of erstwhile princely state of JK. Following 1947 invasion of Kashmir by tribal militias and
Pakistan army, GB has been under Pakistan’s control.
 Present status:
• GB is under occupation of Pakistan, in violation of UN Commission for India and Pakistan (UNCIP) resolution,
1949.
• Pakistan’s occupation took place without consent of people of Gilgit-Baltistan.Despite UNCIP’s calls for
Pakistan to withdraw its forces from disputed area (GB), Pakistan’s occupation remains to this day.

Page 43 of 719
 • For over many decades, Gilgit-Baltistan has lacked proper constitutional status, working legal system and
political autonomy.
• Since 2009, Gilgit-Baltistan has functioned as provincial autonomous region.
 India’s position:
• India has clearly conveyed to Pakistan that entire UT of JK and Ladakh, including Gilgit and Baltistan, are
integral part of India by virtue of its fully legal and irrevocable accession.
 home to 5 of “8-thousanders” and many more high peaks.
 3 of world’s longest glaciers outside polar regions are found in Gilgit-Baltistan.
→ Azad Jammu and Kashmir (AJK).
 Root of fight between India and Pakistan:
→ In 1947, Pakistan’s Pashtoontribals attacked JK.
→ Then ruler Maharaja Hari Singh of JK sought milit ary assistance from India. Then Indian Governor
General Mountbatten signed “Instrument of Accession” with Maharaja Hari Singh in 1947, in which 3
subjects:
 defence
 foreign affairs
 communications
were handed over to India. For other subjects, JK was free to decide its decisions.
→ On basis of treaty of Instrument of Accession, Government of India claims that India has full right to
interfere in matters related to JK.
→ On other hand, Pakistan does not agree with India. Pakistan views POK as liberated (Azad) part of Kashmir
and Pakistan calls POK as - Azad Jammu & Kashmir (AJK). Pakistan’s Constitution says when people of JK
decide to accede to Pakistan, relationship between Pakistan and JK State shall be determined in accordance
with wishes of people of JK State.
 Events:
→ 1947 – 1st Kashmir War
→ 1948 – UN orders ceasefire, leaving part of JK on Pakistan side.
→ 1949 – Gilgit-Baltistan administration given to Pakistan by Azad Jammu and Kashmir (AJK)
→ 1963 – Pakistan cedes Trans Karakoram Tract, part of POK, to China.
→ 1994 – India adopts resolution that Pakistan must vacate POK.
→ 2019 – India says any talks with Pakistan will be only on POK.
 Political structure of POK:
→ POK has parliamentary form of government:
 modelled after British Westminster system
 Muzaffarabad city – capital of POK.
 President of AJK - constitutional head of state
 Prime Minister, supported by Council of Ministers - chief executive.
 Azad Kashmir Legislative Assembly (POK Assembly) - unicameral
 Azad Kashmir Legislative Assembly elects both - Azad Kashmir Prime Minister, Azad Kashmir President.
 POK has its own Supreme Court and High Court
 POK is not represented in Parliament of Pakistan. But, Ministry of Kashmir Affairs and Gilgit-Baltistan,
Government of Pakistan serves as link between Pakistan and Azad Jammu and Kashmir's government.
 Voters in POK vote for POK Assembly.
→ Theoritically, POK is autonomous, self-governing territory. But, Pakistan Army is final decider on all matters of POK.
Pakistan security establishment exercises tight control over POK.
→ For all practical purposes, POK is run directly by Pakistan government and Pakistan Army, through all-
powerful Kashmir Council. Kashmir Council is nominated body, headed by Pakistan Prime Minister, consisting of:
 members nominated by Pakistan government
 members nominated by POK Assembly
 members nominated by POK government, including Azad Kashmir Prime Minister.
 POK people:
→ In 2022, people of POK condemned Pakistan for observing 5th February as Kashmir Solidarity Day and on
contrary marked it as “Fraud Day”. Many protest rallies were held across PoK where POK people criticized
Islamabad for its double standards on Kashmir.(POK region does not have proper healthcare, educational
facilities compared to Islamabad)
 Significance of POK:
→ Location:
 POK shares borders with several countries:
• Afghanistan
• Pakistan
• Xinjiang, China.
Page 44 of 719
  India stand on POK:
→ POK is integral part of India has been our consistent policy since 1947 [entire UT of JK, Ladakh, including
Gilgit-Baltistan, by virtue of its fully legal and irrevocable accession]
→ India has also made clear to world that POK is internal matter of India.
→ Legality of transfer of territory of JK through instrument of accession to India is unquestionable.
→ Indian Parliament resolution talks about whole o f JK being integral part of India.
→ In 1994, India adopted resolution that Pakistan must vacate POK.
→ In 2019, India says any talks with Pakistan will be only on POK.
→ Making GB full-fledged province violates Shimla Agreement, 1972 that mentions that neither side shall unilaterally
alter situation.
→ Currently, Azad Jammu and Kashmir (AJK) is part of JK UT.
→ Currently, Gilgit-Baltistan is part of Ladakh UT.
 Challenges for India in PoK region:
→ Terrorist infiltration through the region is high.
→ Pakistan has changed the demography of PoK over a period of time.
→ It has settled ex- servicemen, Punjabi’s and Pathans so the original colours of PoK has changed.
→ Pakistan gave Chinese mining companies to plunder natural resources in Gilgit Baltistan - mining of gold,
uranium, molybdenum.
 Way Forward:
→ The fact that PoK is an integral part of India has been our consistent policy ever since 1947.
Note:
 Weather war:
→ India and Pakistan over JK
 Instrument of Accession [1947]:
→ Legal document in which Maharaja Hari Singh agreed to accede to Dominion of India.
Value Addition:
 In POK elections, 12 seats are reserved for Refugees.
 Karachi Agreement, 1949:
→ signed by military representatives of India and Pakistan, supervised by UN Commission for India and Pakistan
→ It establishes cease-fire line in Kashmir, following Indo-Pakistan War, 1947.
→ This cease-fire line has since been monitored by UN observers from UN.
 Kohala hydropower project:
→ power project in PoK
→ under CPEC
 Shaksgam Valley:
→ East
→ ceded to China by Pakistan in 1963
Mains Link:
 Discuss why PoK is significant for India.
 Where is Gilgit- Baltistan? How it came under the control of Pakistan? Discuss.

INDIAN PARAMILITARY FORCES / PARAMILITARY FORCES OF INDIA

News:
 2014:
→ MHA outlines BSF’s jurisdiction as whole of area comprised in States of Manipur, ….
 2020:
→ Delhi High Court asks Centre to take call on issue of bringing Assam Rifles out of dual control of Home
Ministry (MHA) and Defence Ministry (MoD).
 Background:
• Petition filed by Assam Rifles Ex-Servicemen Welfare Association seeking direction to government to bring
Assam Rifles under one control, preferably under Indian Army (MoD).
→ Mizoram Chief Minister ask Assam Rifles to shift its base from heart of State capital Aizawl to another
place about 15 km away.
 Issue:
• Stand-off between Mizoram government and Assam Rifles began when Assam Rifles allegedly forced their
way into Mizoram State ignoring COVID-19 safety protocols.
[In 1988 also, Mizoram government asked Assam Rifles to shift from Aizawl after killing of civilians in encounter.]
 2021:
→ ITBP commissioned its 1st two women officers in combat.
→ Under Border Security Force Act, 1968, Ministry of Home Affairs (MHA) extends jurisdiction / area of
operation of Border Security Force (BSF) up to 50 km inside international borders in Punjab, West Bengal,

Page 45 of 719
 Assam. And, Ministry of Home Affairs (MHA) reduces BSF’s jurisdiction / area of operation in Gujarat to 50
km.
 Argument:
• BSF jurisdiction in States is opposed by State governments like Punjab, West Bengal. Law & Order is State
subject and powers of search, seizure, arrest typically lies with State police officials. Hence, affected States
questions as encroachment upon their powers and against federal structure. BSF jurisdiction in States is
being termed as attempt to interfere through Central agencies.
• Centre argues that this in no way impinges on rights of local police because all suspects / arrested are
handed over to them / State Police within 24 hours.
→ Following 2021 killing civilians incident in Nagaland, As sam Rifles issues statement expressing regret over
loss of innocent lives. Assam Rifles also informed that Indian Army had started inquiry into said incident.
 2022:
→ Months after Union government enhanced operational limits of BSF in Punjab, West Bengal, As sam, BSF
carries out its 1 st operation under increased territorial powers / jurisdiction to catch cattle being smuggled
illegally out of Assam, at one place 15 km away from its post. [BSF says increased territorial jurisdiction
helped them plan operations better and also curtailed ab ility of criminal elements to organise closer to
border areas.]
→ Ministry of Home Affairs launches ‘CAPF Punarvaas’, through Welfare & Rehabilitation Board (WARB) for
Central Police Force, MHA.
About:
 What:
→ India maintains 10 paramilitary forces:
 Central Armed Police Forces (CAPF) / Armed Police Forces [7 in nos.]
 Assam Rifles
 Railway Protection Force (RPF)
 Special Frontier Force (SFF):
• of RAW
• under Cabinet Secretariat.
Note:
 Central Armed Police Forces (CAPF) / Armed Police Forces:
→ What:
 uniform nomenclature of 5 Central Armed Police Forces (CAPF) of India
 under Ministry of Home Affairs.
 federal agencies
→ Role:
 Defend national interest, mainly against internal threats.
 federal law enforcement
→ Agency executives:
 Indian Police Service(IPS) Officers
 CAPF Cadre Officers
→ They are:
 Border Security Force (BSF) [1965]:
• What:
 border guarding force
 India's border guarding organisation on its border with Pakistan and Bangladesh.
 one of 5 CAPF of India
 world's largest border guarding force.
 1st Line of Defence of Indian Territories.
 under administrative control of Ministry of Home Affairs.
• History:
 Estd. via Border Security Force Act, 1968 in wake of 1965 India-Pakistan war for ensuring security of
borders of India.
• Feature:
 federal law enforcement
 It has various active roles during outbreak of war.
 only CAPF to have full-fledged Marine Wing, Air Wing, Artillery Regiment of its own.
 under Ministry of Home Affairs.
 has its own cadre of officers but its head, designated as Director-General (DG) has been IPS officer.
 Under Border Security Force Act, 1968, Centre is empowered to notify area and extent of BSF’s
operational mandate. But, every such order / notification must be subsequently laid before each house
of Parliament.

Page 46 of 719
 • Area:
 Indo-Pakistani border
 Indo-Bangladeshi border
 …
• Power:
 Search, Arrest, Seizure - narcotics, cattle smuggling, prevention of trans–border crimes, illegal entry of
foreigners, etc.
 All cases and suspects must be handed over to local police within 24 hours.
 BSF has powers in respect of:
o Criminal Procedure Code (CrPC), Passport (Entry into India) Act, 1920, Passport Act, 1967, NDPS
Act, Arms Act, Customs Act, ...
• Criticisms:
 BSF jurisdiction in States is opposed by State governments like Punjab, West Bengal. Law & Order is
State subject and powers of search, seizure, arrest typically lies with State police officials. Hence,
affected States questions as encroachment upon their powers and against federal structure. BSF
jurisdiction in States is being termed as attempt to interfere through Central agencies.
• Need for BSF Jurisdiction in States:
 To improve operational efficiency and crack down on smuggling rackets.
 Punjab has problem of drugs and arms smuggling.
 Assam, West Bengal face issue of cattle, fake currency smuggling, illegal migration.
 Before MHA incresed their territorial jurisdiction in 2021, BSF regularly got inputs about illegal activity
deep in hinterland but their hands were tied.
 Central Reserve Police Force (CRPF):
• Area:
 Counter-insurgency
 General elections
 Central Industrial Security Force (CISF):
• Area:
 Industries
 PSUs
 Indo-Tibetan Border Police (ITBP):
• What:
 India’s primary border patrol organization for its border with China’s Tibet Autonomous Region.
 one Central Armed Police Force (CAPF)
 under Ministry of Home Affairs, Government of India.
 Indo-Tibetan Border Police Force Act, 1992.
• Area:
 India-China border
• Women in ITBP:
 ITBP started recruiting women combat officers from 2016 through all-India examination conducted by
Union Public Service Commission (UPSC).
 Before this, it had combat women only in constabulary ranks.
 In 2021, ITBP commissioned its 1st two women officers in combat.
 Sashastra Seema Bal (SSB):
• Area:
 Indo-Nepal border
 Indo-Bhutan border
 National Security Guard (NSG):
• India’s premier counter-terrorist force.
• security to VIPs
• conducts anti-sabotage checks
• neutralising terrorist threats to vital installations.
 Special Protection Group (SPG):
• protection of incumbent / former Prime Minister of India, including family members.
• Protection of significant VIPs
 Assam Rifles [1917]:
→ What:
 specialised force that carries out anti-insurgency operations in NE region
 only paramilitary force with dual control structure
 oldest paramilitary force of India.
 oldest branch of Indian Army

Page 47 of 719
  Sentinels of North East
 Anthropologist Verrier Elwin once described Assam Rifles as “friends of hill people”.
→ Estd.:
 In 1835 under British Raj under name Cachar Levy to assist British rulers in maintaining peace in Northeast.
→ Area:
 Northeastern States
→ Control:
 Ministry of Home Affairs (administrative) and Ministry of Defence (operational) via Indian Army.
 Salaries, infrastructure are provided by MHA.
 But, its control is with Indian Army, which is under Ministry of Defence (MoD). That is, deployment,
posting, transfer, deputation is decided by Indian Army.
 All its senior ranks, from IG to DG, sector headquarters are manned by Indian Army officers.
 Assam Rifles is commanded by Lieutenant General (LG) from Indian Army.
→ Function:
 role of guarding India – Myanmar border.
 internal security under control of Indian Army through conduct of counter insurgency and border
security operations
 aid to civilians in times of emergency
 communications, medical assistance, education in remote areas.
 In times of war, it can be used as combat force to secure rear areas.
→ Issue:
 Dual control structure created demands from Assam rifles, MoD, MHA for singular control over Assam
rifles.
 Large section within Assam rifles wants to be under administrative control of MoD, because it would
mean better perks, retirement benefits which are far higher compared to CAPFs under MHA.
 Arguments:
•
{MHA} {Indian Army, MoD}
All border guarding forces are under Assam Rifles has worked well in coordination
operational control of MHA. Thus, Assam with Indian Army and frees up Indian Army
Rifles coming under MHA will give border from many of its responsibilities to focus on its
guarding comprehensive and integrated core strengths.
approach.
Assam Rifles is always military force and not
police force and has been built like that.
Therefore, giving control of Assam Rifles to
MHA or merging Assam Rifles with any other
CAPF will confuse Assam Rifles and jeopardise
national security.
→ Significance:
 Assam Rifles served in World War I (Europe, Middle East), Wor ld War II (Burma).
 After Chinese annexation of Tibet, Assam Rifles were tasked with manning Tibetan border of Assam
Himalayan region.
 Assam Rifles were also instrumental in maintaining law and order in Arunachal Pradesh.
 Central Armed Police Forces (CAPF) vs Indian Armed Forces:
→ Indian Armed Forces are not CAPF.
→ Indian Armed Forces are not headed by civilian officers from Indian Police Service (IPS).
→ Indian Armed Forces are under Ministry of Defence, not Ministry of Home Affairs.
 CAPF Punarvaas:
→ launched by Ministry of Home Affairs, through Welfare & Rehabilitation Board (WARB) for Central Police
Force, MHA.
→ This portal will help retired personnel seeking re-employment to find appropriate match by uploading their
personal details on WARB website along with their area of expertise and preferred employment location.
→ To facilitate retired CAPF and Assam Rifle personnel to secure employment with private security agencies.
Mains Link:
 What is the dual control issue related to Assam Rifles? How can it be resolved? Discuss.
 Discuss the key mandate carried out by Assam rifles. What are the issues and concerns surrounding the dual control of
the same?
 Discuss the concerns associated with the enhanced powers of BSF.

TRANSPORTATION / TRAFFIC
Page 48 of 719
News:
 2022:
→ Centre launches indigenous Intelligent Transportation Systems (ITS) solutions for Indian traffic scenario
under Intelligent Transportation System Endeavor (InTranSE) for Indian CITIES Phase-II Program / InTranSE
-II.
About:
 Intelligent Transportation System (ITS):
→ What:
 Advanced application which aims to provide innovative services relating to different modes of transport and
traffic management and enable users to be better informed and make safer, more coordinated, and 'smarter'
use of transport networks.
 Although ITS may refer to all modes of transport, European Union (EU) defines ITS as systems in which
information and communication technologies are applied in field of road transport, including infrastructure,
vehicles and users, and in traffic management and mobility management, as well as for interfaces with other
modes of transport.
→ Example:
 Some of these technologies include calling for emergency services when accident occurs, using cameras to
enforce traffic laws, signs that mark speed limit changes depending on conditions.
→ Usage:
 ITS may be used to improve efficiency and safety of transport in number of situations, i.e. road transport, traffic
management, mobility, etc.
 ITS technology is adopted across world to increase capacity of busy roads and reduce journey times.
→ India:
 Initiative:
• Intelligent Transportation System Endeavor (InTranSE) for Indian Indian Cities.
Note:
 Intelligent Transportation System Endeavor (InTranSE) for Indian Indian Cities:
→ What:
 National level Collaborative Research and Development Program.
 initiative of as well as funded by MeitY
→ Objective:
 Development, Demonstration, Deployment, Technology Transfer and Commercialization of products and
technologies relevant to Intelligent Transportation System (ITS).
 To provide India with capability to become significant player in area of Intelligent Transportation System (ITS).
→ Feature:
 Indigenous Onboard Driver Assistance and Warning System (ODAWS): It incorporates vehicle-borne sensors for
monitoring driver propensity and vehicle surroundings to deliver acoustic and visual alerts for driver assistance.
 Bus Signal Priority System: It is one operational strategy that modifies normal traffic signal operations to better
accommodate in-service public buses at signal-controlled intersections.
 Common SMart iot Connectiv (CoSMiC) software: It provides Dashboard page showing IoT units, products,
applications, and its live data in Geographical Information System (GIS) map.
Mains Link:
 Discuss the significance of the InTranSE -II Program.

MANUFACTURING SECTOR / SECONDARY SECTOR

News:
 2020:
→ Government launches below 3 incentive schemes to boost large-scale manufacturing of electronics in
India:
 Production Linked Incentive (PLI) Scheme for Electronics Manufacturing.
 Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS)
 Modified Electronics Manufacturing Clusters (EMC 2.0) Scheme
 2021:
→ Demand for semiconductor chips increases owing to Covid-19 pandemic and subsequent lockdowns across
world which forced shutting of crucial chip-making facilities in countries like Japan, South Korea, China, US.
→ “National Programme on Advanced Chemistry Cell (ACC) Battery Storage ”.
→ Manufacturing sector and construction sector are loosing jobs, instead of creating them. Since 2016, Indian
manufacturing sector has been losing jobs. Decline in employment in service sector as well because of COVID-19.Due
to COVID-19, measures aimed at saving lives are proving to be terrible for livelihoods.
→ Union Cabinet approves Production Linked Incentive (PLI) scheme for Specialty Steel. [To become AtmaNirbhar in
producing speciality steel and to make India at par with advanced steel-making countries – Korea, Japan etc.]

Page 49 of 719
 → Government approved scheme to boost semiconductor and display manufacturing in India. [ India
Semiconductor Mission will be set up. “Chips to start-ups” programme to be launched.]
 2022:
→ No signs of global chip (semiconductor chip) shortage easing.
 Why shortage:
• Shutting crucial chip-making facilities in countries like Japan, South Korea, China, US.
• shortage of qualified staff, especially highly qualified engineers to design new chips.
• Stay-at-home shift:
 COVID lockdowns increased growth in sales of laptops.
 This pushed chip demand up.
• Fluctuating forecasts:
 Up and down sale of vehicles [because chips were supplyied to computing, smartphone giants like Apple
Inc].
• Stockpiling:
 Huawei Technologies Co. began building up inventory to survive U.S. sanctions.
• Disasters:
 Shutting (temporary) of semiconductor plants in Texas (USA) in 2021.
→ Economic Survey 2021-22 says shortage of semiconductors led to closure or lowering of production by many firms
from different industries.
→ Amid ongoing 2022 Russia-Ukraine crisis, it is expected that global chip shortage situation may worsen.
 Reason:
• Russia and Ukraine are important centres of global semiconductor supply chain. They provide rare metals
like palladium, and gases like neon, that are needed in production of silicon wafers present in almost all
modern devices, equipment.Russia supplies global semiconductor industry with rare metals. Ukraine
supplies (speciality) gases required by chip-making industry.
 Impact:
• Disruption in supply chain of semiconductors, which are key to manufacturing autos, electronic equipment
in Asia-Pacific region.
→ Centre forms Ashwini Vaishnaw Committee [2022] - advisory committee for semiconductor manufacturing in India.
→ 61 applications, for projects, approved under Production Linked Incentive (PLI) Scheme for textiles.
→ 1st ever / SemiconIndia 2022 Conference held in Bengaluru.
→ Gujarat becomes 1st State in India to release dedicated semiconductor policy.
→ GOI launches initiative to connect Indian startups with US investors: Commerce and Industry Minister Piyush Goyal
launches one initiative - Supporting Entrepreneurs in Transformation and Upskilling (SETU) - to connect startups in
India to US-based investors. [This programme was launched during interaction focused on specific issues related to
startup ecosystem in India].
→ In bid to make India’s USD 10 billion chip-making initiative more attractive to investors, Union Cabinet approves
modifications in scheme - “Programme for Development of Semiconductors and Display Manufacturing Ecosystem
in India” - with one uniform fiscal support of 50% project cost for all technology nodes for setting up of semiconductor
fabrication units.
→ GOI says that Fund of Funds for Startups (FFS), launched under Startup India initiative in 2016 with corpus of Rs
10,000 crore, has committed Rs 7,385 crore to 88 Alternative Investment Funds (AIFs) till date. These AIFs in turn
have invested crores in many startups. FFS has helped anchor some AIFs.
About:
 Status:
→ India ranks globally 3rd in startup ecosystem and also in terms of number of Unicorns. As per latest data, there are
currently 105 unicorns.
 Electronic Sector:
→ Semiconductor Chip:
 What:
• Semiconductor:
 materials with conductivity between conductors and insulators. pure elements, silicon, germanium,
compounds, gallium, arsenide, cadmium selenide. Semiconductor is substance that has specific
electrical properties that enable it to serve as foundation for computers and other electronic devices.
It is typically solid chemical element or compound that conducts electricity under certain conditions
but not others.
Semiconductor is substance that has specific electrical properties that enable it to serve as
foundation for computers and other electronic devices.
• Semiconductor chips are materials which have conductivity between conductors and insulators. They can
be pure elements, silicon or germanium or compounds; gallium, arsenide or cadmium selenide.

Page 50 of 719
 Semiconductors / Integrated Circuits (ICs) / Microchips are usaully made of silicon or germanium, or
compound like gallium arsenide.
 Feature:
• It makes electronic items smarter and faster. Semi-conducts electricity. It performs many functions.
Memory chips, which store data, are relatively simple and are traded like commodities. Logic chips, which
run programs and act as brains of device, are more complex and expensive.
 Component:
• Basic component of semiconductor chip is sliver of silicon, which is etched with billions of microscopic
transistors to control flow of current. Most-advanced semiconductor technology nodes are available today
are 3 nm and 5nm ones. Semiconductors having higher nanometre value are applied in automobiles,
consumer electronics and so on, while those with lower values are used in devices such as smartphones,
laptops.
 Countries / producers:
• Taiwan. USA. Japan. South Korea. China.
 Status:
• Global semiconductor industry is currently valued at USD 500-600 billion and caters to global electronics
industry currently valued at about USD 3 trillion.
 Issue:
• Chip-making industry is one highly-concentrated one. That is, 90% of 5nm chips are mass-produced in
Taiwan, by Taiwan Semiconductor Manufacturing Company Limited (TSMC).
• Shortage of chips: Due to Covid pandemic induced closure of factories; US-China tension in Taiwan; Russia-
Ukraine war disrupting Supply chain; rising demand.
• Impact of shortage of supply:
 Carmakers will lose USD billions because of no sale. Disrupt supply chain. Constrain production of
electronic equipments. Impacts consumers as prices of everyday appliances, electronic goods — TV,
smartphones —increased.
 Significance:
• Basic building blocks that serve as heart and brain of all modern electronics, information and
communications technology products. Semiconductor is building block of almost every modern electronic
device from smartphones to connected devices in IoT.
• integral part of contemporary automobiles, household gadgets, essential medical devices - ECG machines.
 India:
• India currently imports all chips.
• Currently, Indian market is about USD 24 billion.
• Initiative:
 Centre allocated crores for supporting development of ‘semiconductors and display manufacturing
ecosystem’. That is, USD 10 billion chip-making initiative - “Programme for Development of
Semiconductors and Display Manufacturing Ecosystem in India”.
 PLI Scheme launched.
 India launched Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors
(SPECS) [SPECS covers electronic goods (electronic components, semiconductor, display fabrication
units, Assembly, Test, Marking and Packaging (ATMP) units, specialized sub-assemblies, capital goods
for manufacture of aforesaid goods].
 India is finalising plans to manufacture semiconductor chips as part of its ‘Make in India’ initiative. [to
achieve self-sufficiency in manufacturing of semiconductors]
 India is offering around USD 1 billion to each semiconductor company that sets up manufacturing units
in India.
 Chips made locally will be designated as “trusted sources” and can be used in products - CCTV cameras,
5G equipment etc.
 In 2021, India invited “expression of interest” from chipmakers for setting up fabrication units in India
or for acquisition of such manufacturing units.
 In 2022, India Semiconductor Mission under aegis of MeitY organised SemiconIndia Conference in
Bengaluru.
 In 2022, Vedanta (India’s oil-to-metals conglomerate) and Foxconn (electronics manufacturing
giant) signed MoU with Gujarat government to together set up one semiconductor and display
FAB manufacturing unit in Gujarat. Both companies will invest Rs. 1,54,000 crore for
establishing FAB facility in Gujarat state.
• Challenges:
 High investments required.
 Minimal fiscal support from government.
 Lack of semiconductor fabrication capacities.
 Insufficient grants under PLI scheme.
Page 51 of 719
  Resource inefficient sector.
 Chip production is resource-intensive and expensive process.
 Chip-making also requires gallons of ultrapure water in single day.
• Gujarat:
 In 2022, Gujarat became 1st State in India to release dedicated semiconductor policy. Gujarat
Government also proposed to develop one special ‘Semicon City’ as a part of Dholera Special
Investment region. Under Gujarat Semiconductor Policy 2022-27, Gujarat Government will provide
heavy subsidies on power, water, land tariffs for entrepreneurs who are interested in investing in
semiconductors or display fabrication manufacturing in Gujarat.
 Way Forward:
• Governments all over world are trying to create their domestic chip-making industry.
→ Initiative:
 Startup India [2016] (‘Prarambh’ Summit, National Startup Awards), Startup Innovation Challenges, ,
Ranking of States on Support to Start-up Ecosystems, Shanghai Cooperation Organization Startup
Forum.
 National Policy on Electronics 2019 / NPE 2019:
• To position India as global hub for Electronics System Design and Manufacturing (ESDM) by encouraging
and driving capabilities in India for developing core components and creating enabling environment for
electronic industry to compete globally.
 Production Linked Incentive Schemefor Electronics Manufacturing:
• Part of NPE 2019.
• financial incentive to boost domestic manufacturing, attract large investments in electronics value chain.
• Targeted at mobile phone manufacturing, electronic components.
 Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS):
• Covers electronic goods (electronic components, semiconductor, display fabrication units, Assembly, Test,
Marking and Packaging (ATMP) units, specialized sub-assemblies, capital goods for manufacture of aforesaid
goods).
 Modified Electronics Manufacturing Clusters (EMC 2.0) Scheme:
• creation of world class infrastructure for attracting major global electronics manufacturers, supply chains.
 India Semiconductor Mission.
 “Chips to start-ups” programme.
 In 2022, Centre formed Ashwini Vaishnaw Committee [2022] - advisory committee for semiconductor
manufacturing in India.
→ Significance:
 manufacture electronics
 generating employment
 India achieves modest success in electronics manufacturing.
 India emerges as 2nd largest mobile manufacturer of world.
 Strategic:
• Source of semiconductors is of strategic importance in current geopolitical scenario.
• Semiconductors are key to security of critical information infrastructure.
 Digital sovereignty of India.
 Job Creation
 Increase in FDI
→ Way Forward:
 self-reliant India.
 Make India global hub of electronic system design and manufacturing (ESDM).
 Develop electronic ecosystem that can be asset to global economy.
 Reason why Indian manufacturing sector fails to create jobs:
→ Inadequate investment
 Manufacturing units require highest amount of investment.
→ Highly extractive nature of Indian governments – via corruption, weak supply etc.
→ Weak domestic demand:
 Indians have always consumed relatively less manufacturing goods and consumed relatively more food and
services.
 Because Indians are poor and hence incomes are spent on food, repairs, maintenance etc.
→ Inadequate policy:
 Indian policy treats labour-intensive manufacturing firms as small-scale industries.
 This held back growth of labour-intensive manufacturing firms.
 Issues in Make in India (MII):
• MII aims more at capital intensive manufacturing and not labour intensive manufacturing firms.
Page 52 of 719
  Issues in Production-Linked Incentive (PLI) scheme:
• PLI also aims more at capital intensive manufacturing and not labour intensive manufacturing firms.
→ Isolation of supply chain:
 India did not integrate its labour-intensive manufacturing firms in global supply chains via aggressive exports.
 Instead, focus was on substitution of imports by domestic goods.
 Initiative:
→ National Investment & Manufacturing Zones (NIMZ) [2019]:
 Zone / policy that focuses on industrial growth through collaboration with local State governments.
 NIMZ policy focuses on industrial corridors.
→ Make in India [2014.]
 Significance:
→ manufacturing sector is best hope to soak up surplus labour, otherwise employed in agriculture.
→ Unlike service sector that requires high skills, manufacturing sector is well suited for new job creations, soaking up
surplus labours because it can make use of uneducated, unskill labours.
→ Manufacturing sector is India’s best hope for creating new jobs and soaking up excess unskilled labour from
agriculture.
 Way Forward:
→ Policy should target labour-intensive firms - informal sector, MSMEs etc. — via:
 better infrastructure
 easier regulatory support
so as to create millions of new jobs.
Note:
 Startup India [2016]:
→ What:
 initiative of the Government of India envisages building a robust Start-up ecosystem in the country for nurturing
innovation and providing opportunities to budding entrepreneurs. To develop ecosystem that promotes and
nurtures entrepreneurship across India.
→ Startup India Seed Fund Scheme [2021]:
 What: To provide capital to entrepreneurs at early stages of growth of enterprise, so as to conduct concept trials.
Ministry of Commerce and Industry.
 Aim: To provide financial assistance to eligible startups (DPIIT chosen) through incubators for proof of concept,
prototype development, product trials and commercialization.
 Need: Funding from angel investors and venture capital firms becomes available to startups only after proof of
concept has been provided. Similarly, banks provide loans to startups only to asset-backed applicants.
 Eligibility: Startup, recognized by DPIIT, incorporated not more than 2 years ago at time of application and should
not have received more than 10 lakhs of monetary support under any other Central or State Government
scheme.
 Features: Grants of up to 5 crores to eligible incubators, they in turn will provide up to Rs. 20 lakh (for proof of
concept, prototype development, or product trials to startups) and up to Rs. 50 lakh (for market entry,
commercialization, or scaling up) to eligible startups.
→ Delhi as startup hub:
 In 2022, Delhi overtook Bengaluru to become startup capital of India. According to Economic Survey 2021-22,
over 5,000 recognised startups were added in Delhi, while 4,514 startups were added in Bengaluru in 2021.
 What makes Delhi attractive destination?
• Industry dept. coordinates with many 30 different Delhi agencies for giving approvals to new business. Over
460 compliances amended or modified in recent years. 31 days is max. limit for giving electricity
connections, best in Asia. 150 services under doorstep delivery scheme. “Inspector Raj” removed from
taxation dept. Good infrastructure: Delhi metro, free ride for women in buses. Reliable 24 x 7 electricity.
Focus on green technology (this attracts energy related startups). Entrepreneurship-based school
curriculum, Delhi Skills and Entrepreneurship University.
→ Fund of Funds for Startups (FFS):
 It comes under Startup India scheme (2016) to mobilize domestic capital for Indian start-up ecosystem. It will
help startups avail funds at early and seed stage and reduce their dependence on foreign capital. FFS gave crores
of rupees to some Alternative Investment Funds (AIFs) which in turn invested crores in many startups. FFS helped
anchor some AIFs.
 Ashwini Vaishnaw Committee [2022]:
→ Advisory committee for semiconductor manufacturing in India. It will be chaired by Ashwini Vaishnaw,
Minister of Electronics and IT. It shall steer objectives in structured, efficient, strategic manner, and
provide necessary guidance to India Semiconductor Mission (ISM) executives.
 2021 State of Working India report (Azim Premji University):

Page 53 of 719
 → COVID-19 pandemichad forced people out of their formal jobs into casual work. COVID-19 pandemic had
led to severe decline in incomes. COVID-19 pandemic had caused sudden increase in poverty. COVID-19
pandemic had induced job losses, mainly in: Delhi, Uttar Pradesh, Maharashtra, Tamil Nadu, Kerala.
 Report by Centre for Monitoring Indian Economy, Mumbai:
→ Indian economy has worsened over past few years, even before COVID -19. Number of people employed in
manufacturing sector has decreased. Number of people employed in agriculture has gone up. Employment
in non-financial services has fallen.
 Make in India [2014]:
→ What:
 Policy / initiative of Indian government. to incentivise production in India. encourage manufacturing in India and
galvanize economywith dedicated investments in manufacturing and services.
→ Targets:
 manufacturing growth rate of 12-14% per annum and utlimately increase manufacturing sector’s share in
economy. manufacturing sector’s contribution to GDP should be about 25% by 2025. create millions of
manufacturing jobs in economy by 2022.
→ Performance:
 Upto 2016, FDI increased. But after 2016 FDI has not increased further and currently, FDI in manufacturing sector
is becoming weaker. FDIs in service sector is about 3 times that of manufacturing sector. India’s share in global
exports of manufactured products remains low at around 2%.
 Production Linked Incentive Scheme / PLI Scheme [2020]:
→ What:
 It offers to boost domestic manufacturing and attract large investments in specified sector. E.g., in electronics
sector, PLI scheme shall extend incentive of 4% to 6% on incremental sales (over base year) of goods
manufactured in India for period of 5 years. It aims to scale up domestic manufacturing capability, accompanied
by higher import substitution and employment generation.
 way to reward increased production in specified sector
 Financial incentives given to many sectors:
• pharmaceutical
• IT hardware (laptops etc.)
• Solar energy sector
• mobile phones & telecom equipments
• Electronics / technology products
• white goods (air-conditioners, LED bulbs etc.)
• Textiles
• Food products
• Automobiles
• MSMEs
• food processing industryetc
→ How:
 Centre will subsidise eligible manufacturers by paying incentives on incremental production.
 duty refunds
 incentives
→ Why:
 To make India manufacturing hub
 To make India self-reliant
 create employment
→ Aim:
 Make domestic manufacturing competitive and efficient in international market
 Create economies of scale.
 Make India part of global supply chain.
 Attract investment
 Attract cutting edge tech.
 Create exports.
 higher income to domestic workers
→ Significance:
 immense boost to domestic manufacturing
 big impact in global markets
 in sync with Atmanirbhar Bharat spirit
 economic growth
 job creation
 government expects to attract fresh investment.
Page 54 of 719
 → Example:
 PLI scheme for textiles:
• What:
 part of larger PLI scheme for many sectors
• Aim:
 to promote production of high value Man-Made Fibre (MMF) fabrics, garments, technical textiles.
• Need:
 2/3rd of international trade in textiles is of man-made and technical textiles.
• Eligibility:
 Person or company willing to invest in plant, machinery, equipment, civil works (excluding land and
administrative building cost) to produce products of MMF fabrics, garments, products of technical
textiles.
• Incentive:
 Centre will subsidise eligible manufacturers by paying incentives.
 Investing companies will also be eligible to receive duty refunds.
• Significance:
 It will help India gain dominant status in global textile trade.
→ Design led Incentive (DLI) scheme:
 DLI is part of Production Linked Incentive (PLI) Scheme. DLI will offer 1% additional incentive over PLI scheme.
Telcom equipment makers who use at least 50% Made in India components will be eligible for DLI.
 Specialty Steel:
→ value-added steel wherein normal finished steel is worked upon - coating, plating, heat treatment, etc. to
convert normal finished steel into high-value-added steel.
→ Specialty Steel can be used in - Defense, Space, Power, automobile sector, capital goods etc.
 Advanced Chemistry Cells (ACC):
→ new generation of advanced storage technologies
→ stores electric energy in form of:
 electrochemical; or
 chemical energy
→ converts back to electric energy.
 SemiconIndia Conference [2022]:
→ What:
 Inaugural ‘SemiconIndia 2022’ Conference was organised by India Semiconductor Mission [under MeitY] in
partnership with industry and industry associations.
→ Aim:
 To make India global hub for Semiconductor Design, Manufacturing and Technology Development which will
help propel vision of India Semiconductor Mission.
→ Vision:
 To position India on Semiconductor map of world and build vibrant semiconductor innovation and
manufacturing ecosystem.
→ Theme:
 Catalyzing India’s Semiconductor Ecosystem.
→ Significance:
 It aims to make India significant player in Global Semiconductor value chain.
 Supporting Entrepreneurs in Transformation and Upskilling (SETU) [2022]:
→ Launched in 2022 by GOI (Ministry of Commerce and Industry) to connect Indian startups with US-based investors.
This programme was launched during interaction focused on specific issues related to startup ecosystem in India.
SETU is designed to break geographical barriers between mentors based in USA that are willing to invest in
entrepreneurship and sunrise startups in India. This initiative would connect startups in India to US-based investors
and startup ecosystem leaders with mentorship and assistance in various areas, including funding, market access,
commercialisation. Interactions can be done using mentorship portal under Startup India initiative - MAARG portal
(Mentorship, Advisory, Assistance, Resilience and Growth). MAARG is one single-stop solutions finder for startups in
India.
Value Addition:
 Russia is world’s largest producer of palladium, 2 nd -largest producer of platinum, produces about 80% of all
European gold.
 Meta resource:
→ It is list of useful resources.
→ Electronics is recognised as one meta resource across world.
 Curie point / Curie Temperature:
→ temperature at which certain magnetic materials undergo sharp change in their magnetic properties.

Page 55 of 719
Question:
 Organic Light Emitting Diodes (OLEDs) are used to create digital display in many devices. Advantages of OLED
displays over Liquid Crystal displays are - OLED displays can be fabricated on flexible plastic substrates; Roll-up
displays embedded in clothing can be made using OLEDs; Transparent displays are possible using OLEDs.
OLED TV is one television display technology based on characteristics of organic light -emitting diodes
(OLED). OLED TV is different technology than LED TV. OLED display is based on organic substance used as
semiconductor material in light-emitting diodes (LEDs). OLEDs are ultrathin and light, they can be fabricated on
flexible plastic or roll-up displays. Transparent displays are also possible. In general, OLEDs are more efficient
than LCDs for displaying dark images because black pixels consume little powe r for emissive display, while LCDs
are more efficient than OLEDs at displaying bright images.
Mains Link:
 The words “lives” and “livelihoods” are often mentioned together. But Covid pandemic had created a difference between
these two. Comment.
 Discuss the performance of MII initiative.
 What is the production linked incentive scheme for electronics manufacturers? Discuss.
 Growing importance of Semiconductors or chips/integrated circuits (ICs) and China’s experience with the
manufacturing and design of the same provides a strong case for focusing on chip designs in India. Comment.
 Discuss the significance of PLI scheme.
 Given its scientific and strategic significance, India needs to be far more ambitious in creating a domestic
semiconductor industry on a war footing. Discuss. (250 Words)

SPECIAL PURPOSE ACQUISITION COMPANY (SPAC) / BLANK CHECK COMPANY

News:
 2022:
→ Centre consideres one regulatory framework for Special Purpose Acquisition Companies (SPACs).
About:
 What:
→ shell corporation listed on stock exchange with purpose of acquiring private company, and thus making it
public without going through traditional IPO process.
→ entity specifically set up with objective of acquiring firm in particular sector.
 Objective:
→ To raise money in IPO without any operations or revenues.
 Feature:
→ Money raised from public is kept in escrow account, which can be accessed while making acquisition.
→ If acquisition is not made within 2 years of IPO, SPAC is delisted and money is returned to investors.
 Benefit:
→ SPACs are essentially shell companies, but they are attractive to investors because people who sponsor
SPACs are globally, prominent names.
 Concerns:
→ In 2021, US Securities and Exchange Commission (SEC) issued investor alert on SPACs, cautioning investors
“not to make investment decisions related to SPACs based solely on celebrity involvement”.
→ There may be lesser returns for retail investors post-merger. Despite growth in number of SPACs, academic
analysis shows investor returns on SPACs post-merger are almost uniformly negative.
→ Certain clauses could potentially prevent investors from getting their monies back.
 United States:
→ According to U.S. Securities and Exchange Commission (SEC), SPACs are created specifically to pool funds
to finance merger or acquisition opportunity within set timeframe.
→ In United States, SPACs are registered with US SEC and considered publicly -traded companies. General
public can buy their shares before any merger or acquisition takes place. For this reason they have at times
been referred to as "poor man's private equity funds".
Note:
 2019 Company Law Committee of Ministry of Corporate Affairs, on boosting ease of doing business in India,
suggested Centre to set up SPACs.
Mains Link:
 Discuss the concerns associated with SPACs.

NISAR
News:
 2021:
→ NISAR satellite will be launched in 2023. [ISRO already delivered S-band SAR payload to NASA for NISAR
mission.]
 2022:
Page 56 of 719
 → ISRO and NASA are working on NISAR.
About:
 What:
→ NASA-ISRO-Synthetic Aperture Radar mission is one joint project between NASA and ISRO to co-develop
and launch dual-frequency synthetic aperture radar on Earth observation satellite. This satellite will be 1 st
radar imaging satellite to use dual frequencies. NISAR is likely to be world's most expensive Earth -imaging
satellite.
→ Satellite for scientific studies of Earth. near-polar satellite. Earth-observing mission.
 Objective:
→ Tracking / measuring delicate changes in Earth’s surface i.e. detection of movements of planet’s surface.
→ spotting warning signs of imminent volcanic eruptions
→ monitor groundwater supplies
→ tracking rate at which ice sheets are melting.
 Feature:
→ It has largest reflector antenna ever launched by NASA
 Function:
→ NISAR will scan globe every 12 days over course of its 3-year mission of imaging Earth’s land, ice sheets
and sea ice to give unprecedented view of planet Earth.
→ Study hazards and global environmental change
→ help manage natural resources better
→ provide information to scientists to better understand effects and pace of climate change.
→ SAR will detect movements of Earth’s surface, even small movement.
 Collaboration:
→ NASA will provide one radar for NISAR satellite, one communication subsystem for science data, GPS receivers,
payload data subsystem.
→ ISRO will provide spacecraft bus, one radar (S-band radar), launch vehicle, launch services.
 Usage:
→ NISAR will be used for remote sensing, to observe and understand natural processes on Earth. For example,
its left-facing instruments will study Antarctic cryosphere.
→ NISAR mission will collect data vital to tackling climate crisis.
 Fact:
→ ISRO has been getting Deep Space Network Antenna support from NASA in its Missions such as
Chandrayaan-1, Mars Orbiter Mission (MOM), and Chandrayaan -2 mission and will continue availing
support for our Chandrayaan-3 mission.
Note:
 Synthetic Aperture Radar (SAR):
→ What:
 form of radar
 It reconstructs objects – landscapes etc.
 typically mounted on moving platform – aircraft, spacecraft etc.
 i.e. mostly airborne or spaceborne side looking radar system.
 usesflight path of moving platform motion to scan over target region / object.
 Its technique produces high-resolution images with high precision. Because of precision, SAR can penetrate
clouds and darkness and that means SAR can collect data day and night in any weather.
Mains Link:
 Write a note on NISAR.

INVASIVE SPECIES
News:
 2022:
→ Invasive species threatens wildlife habitats of Western Ghats. Senna spectabilis is one invasive species
plant found mostly in forest areas of Nilgiri Biosphere Reserve (NBR). Lack of effective steps to arrest
rampant growth of this invasive plant is matter of serious concern to conservation of wildlife habitats of
Western Ghats.
About:
 What:
→ Introduced organism that becomes overpopulated and harms its new environment.
→ Invasive alien species are plants, animals, pathogens, other organisms that are non -native to one
ecosystem, and which may cause economic or environmental harm or advers ely affect human health.
→ This term can also be used for native species that become harmful to their native environment after hum an
alterations to its food web.

Page 57 of 719
  Invasive Alien Species:
→ Species introduced outside its natural past or present distribution which becomes problematic for that
environment.
 Example:
→ For example, invasive species purple sea urchin devours kelp forests along California coast due to
overexploitation / over killing of urchin’s natural predator - California sea otter.
 Feature:
→ Although most introduced species are neutral or beneficial with respect to other species, invasive species
adversely affect habitats and bioregions, causing ecological, environmental, and / or economic damage.
 Concerns / impact:
→ They impact adversely upon biodiversity, including decline or elimination of native species – through
competition, predation, or transmission of pathogens – and disruption of local ecosystems and ecosystem
functions.
→ Since 20th century, invasive species have become serious economic, social, environmental threat.
→ Invasive species now spreads through most iconic wildlife habitats of Western Ghats, destroying habitats
of elephants, deer, gaur, tigers by pushing out native flora.
→ Allelopathic traits of invasive species prevent other plants from growing under it.
→ affects primary productivity at ground level. Forest floor is almost bare under invasive species. Grasses
and herbs get completely wiped out and herbivores are deprived of their forage.
→ Carrying capacity of forests to feed wildlife is drastically declining under invasion, which accelerates man-
animal conflict further.
→ Reduced biodiversity.
→ Decreased availability and quality of key natural resources.
→ Water shortages.
→ Increased frequency of wildfires and flooding.
→ Pollution caused by overuse of chemicals to control infestations.
 Initiative:
→ Convention on Biological Diversity (CBD) recognizes that there is urgent need to address impact of invasive
species.
→ CBD’s Aichi Biodiversity Targets and UN SDG 15 (Life on Land) specifically address this issue.
→ IUCN SSC Invasive Species Specialist Group (ISSG) aim to reduce threats to ecosystems and their native
species by increasing awareness of ways to prevent, control or eradicate Invasive Alien Species.
→ IUCN has developed knowledge platforms:
 Global Invasive Species Database (GISD)
 Global Register of Introduced and Invasive Species (GRIIS).
→ In Kerala, Kerala Forest Department attempted to remove trees by uprooting, girdling, cutting, chopping
tree branches, and even testing application of chemicals. However, all efforts were in vain. Instead,
multiple shoots started growing from each cut tree stump. This situation is similar in Karnataka, Tamil
Nadu.
Note:
 Allelopathy:
→ Effects (stimulatory and inhibitory) of one plant on development of neighboring plants through release of
secondary compounds.
→ biological phenomenon by which one organism produces one or more biochemicals that influence
germination, growth, survival, reproduction of other organisms.
 Autoallelophaty:
→ beneficial or harmful effect of one plant species on itself.

WORLD BANK GROUP (WBG) [1944]

News:
 2020:
→ World Bank approves USD 1 billion aid to India to accelerate India’s COVID-19 response.
 2021:
→ Stars Project (World Bank) in news.
→ World Bank (WB) conducts study on impact of Black Carbon (BC) over Himalaya, Karakoram, Hindu Kush (HKHK)
mountain ranges, where glaciers are melting faster than global average ice mass.
→ International Finance Corporation (IFC) demands that India’s Federal Bank Ltd. (Indian private sector bank and
7th largest commercial bank of India) should stop coal financing. [Federal Bank Ltd. is key lender to firms like
Jindal Steel Works (JSW) Energy Ltd., Adani Power Rajasthan Ltd].
→ World Bank announces it will discontinue publishing its Doing Business report.
→ World Bank releases updated “Groundswell” report.

Page 58 of 719
  2022:
→ Jointly, MH govt. and IFC set to prioritise health care projects with emphasis on Medical Education under public-
private partnership (PPP) model in Maharashtra. Herein, IFC will be transaction advisor for this PPP to develop
super-specialty hospitals and medical education facilities across MH State.
→ Responding to rising food insecurity, World Bank’s private sector investment arm, the International Finance
Corporation (IFC) launches a new, USD 6 billion financing facility - Global Food Security Platform - to strengthen
private sector’s ability to respond to the food crisis and help support food production.
About
 What:
→ Intergovernmental organization
→ family of 5 international organizations that make leveraged loans to developing countries.
→ largest and best-known development bank in world
→ observer at United Nations Development Group (UNDG)
→ headquartered - Washington, D.C., USA.
 Aim:
→ poverty elimination
→ Economic development
 Mission:
→ achieve twin goals of:
 ending extreme poverty
 building shared prosperity.
 Its 5 organizations:
→ International Bank for Reconstruction and Development (IBRD) [1944]:
 original lending arm of World Bank.
→ International Development Association (IDA) [1960]:
 IDA aims to reduce poverty by providing loans (credits) and grants for programs that boost economic growth,
reduce inequalities, and improve people’s living conditions.
 IDA also provides grants to countries at risk of debt distress.
 IDA complements IBRD.
 IDA lends money on concessional terms. That is, IDA charges little or no interest and repayments are stretched
over 25 to 40 years, including 5- to 10-year grace period.
 After lending, IDA assess countries on how well they implement policies that promote economic growth
and poverty reduction.
→ International Finance Corporation (IFC) [1956]:
 What:
• Development finance institution
• international financial institution that offers investment, advisory, and asset-management services to
encourage private-sector development in less developed countries.
• member of World Bank Group
• headquartered- Washington, D.C., USA.
• private-sector arm of WBG
 Objective:
• Private sector development
• Poverty reduction
 Role:
• development goals:
 increase sustainable agriculture opportunities
 advance economic development
 improve healthcare and education
 increase access to financing for microfinance and business clients, advance infrastructure
 help small businesses grow revenues
 invest in climate health.
• offers debt and equity financing services and helps companies face their risk exposures.
• advises governments on building infrastructure
• partnerships with governments to further support private sector development.
• investing in strictly for-profit and commercial projects that appear to reduce poverty and promote
development.
 Feature:
• IFC is owned and governed by its member countries
• IFC has its own executive leadership and staff

Page 59 of 719
 •
IFC is corporation whose shareholders are member governments that provide paid-in capital and have right
to vote.
→ Multilateral Investment Guarantee Agency (MIGA):
→ International Centre for Settlement of Investment Disputes (IC SID):
 IBRD and IDA are sometimes collectively referred to as - World Bank.
 India:
→ Is member state of 4 WBG organisations [India is not member of ICSID]
Note:
 World Bank [1944]:
→ What:
 WB is international financial institution that provides loans and grants to governments of low- and middle-
income countries for purpose of pursuing capital projects.
 World Bank is collective name for:
• International Bank for Reconstruction and Development (IBRD).
• International Development Association (IDA).
 founded at 1944 Bretton Woods Conference.
 IBRD and IDA share same staff and headquarters
 IBRD and IDA evaluate projects with same standards.
→ Aim:
 loans to developing countries to help reduce poverty.
→ Activities:
 World Bank's (IBRD and IDA) activities focus on developing countries and in fields:
• human development (education, health,…)
• agriculture and rural development (irrigation, rural services)
• environmental protection (pollution reduction, establishing and enforcing regulations)
• infrastructure (roads, urban regeneration, electricity)
• large industrial construction projects
• governance (anti-corruption, legal institutions development)
• …
 Engages in global partnerships and initiatives
 takes role in addressing climate change
→ World Bank Loan:
 IBRD and IDA provide loans at preferential rates to member countries, and grants to poorest countries.
 Loans or grants for specific projects are often linked to wider policy changes in sector or country's economy as
whole.
 Its loan strategy is influenced by SDGs, environmental and social safeguards.
→ Voting power:
 U.S.
 Japan
 China
 Germany
 U.K.
→ Criticism:
 World Bank has been criticized as promoting inflation
 World Bank has been criticized as harming economic development.
 World Bank has been criticized on how it is governed
 There have been incidents of major protests against World bank.
 There has been criticism of World bank’s response to Covid-19 pandemic.
→ World Bank is major issuer of green bonds.
→ India’s project - Integrated Coastal Zone Management (ICZM) is assisted by World Bank.
→ Global Tiger Initiative (GTI)isone program of World Bank
→ World Bank report says, in India, water currently available to individual will significantly fall by 2030. This will
create unimaginable disaster for majority people in India.
 STARS Project (World Bank):
→ What:
 Strengthening Teaching-learning And Results for States.
 project to improve quality and governance of school education in some Indian States.
 new Centrally Sponsored Scheme under Ministry of Education.
→ Feature / Reform initiatives:
 Focusing directly on delivery of education services by providing customized local-level solutions.

Page 60 of 719
  Addressing demands from stakeholders, especially parents, for greater accountability, inclusion.
 Equipping teachers to manage this transformation.
 Investing more in developing India’s human capital needs.
→ Components:
 Contingency Emergency Response Component (CERC):
• enablefor more responsive to any natural, man-made, health disasters.
• help government respond to loss of learning (school closures, infrastructure damage, inadequate facilities)
• facilitate re-categorization of financing
 PARAKH:
• Performance Assessment, Review and Analysis of Knowledge for Holistic Development.
• autonomous institution under Ministry of Education.
• National Assessment Centre.
• It is included in National Education Policy (NEP) 2020
• This will set norms for student assessment and evaluation for all school boards across India, most of which
currently follow norms set by State governments.
• It guide standardised testing to monitor learning outcomes at State and national levels.
→ Significance:
 Millions of students and teachers in lakhs of schools is concern States will benefit from this program.
Mains Link:
 Write a note on World Bank’s STARS project.

FISHERIES SECTOR
News:
 2021:
→ Union Government is considering increasing unit cost of deep-sea fishing vessels under Palk Bay scheme to make it
more attractive to fisherfolk.
→ Under Pradhan Mantri Matsya Sampada Yojana (PMMSY), Ministry of Fisheries, Animal Husbandry and Dairying
launches Nationwide River Ranching Programme in some States.
 2022:
→ Over 10,000 fish of Indian major carps — catla, rohu, mrigal — released in Ganga R. at Sangam nose in Prayagraj, UP
under ranching programme organised by ICAR-Central Inland Fisheries Research Institute (CIFRI), Prayagraj. [This
exercise was undertaken for conservation and promotion of fish species that are becoming extinct in Ganga R.].
→ Realizing potential of Fisheries sector, Technology Development Board supports M/s Fountainhead Agro Farms
Private Limited, Navi Mumbai, Maharashtra for ‘Advanced, Intensive, All Male Tilapia Aquaculture Project with Israeli
Technology’ for production of “Tilapia Fish”. This board has penned mutual agreement, to provide loan assistance of
Rs. 8.42 crores out of total project cost of Rs. 29.78 crores to this company. [It will help support Blue Revolution in
India]. Under this project, Tilapia will be grown from imported parent broodstock ‘Hermon’ from Israel. Hermon is
one hybrid of 2 selected strains of Tilapia, namely Oreochromis Niloticus (Male) and Oreochromis Aureus (Female),
and shows high growth rate, resistance to low temperature, and all hybrid fry progeny of males only.
About:
 Intro:
→ Fisheries sector in India occupies very important place in socio-economic development of India.
→ Fisheries is powerful income and employment generator because:
 it stimulates growth of other subsidiary industries
 it is source of cheap and nutritious food
 it earns foreign exchange.
 it is source of livelihood for large section of economically backward population of India.
 Fact:
→ India is 2nd largest producer of fish in world contributing to about 7.56% of global fish production.
→ India is also major producer of fish through aquaculture (2nd in world after China)
→ Total fish production includes from inland sector and from marine sector.
→ Fisheries is one promising sector of agriculture and allied activities in India
→ As per Central Statistical Organization (CSO), GDP fromfisheries sector is about 4% of total GDP of Agriculture and
allied sectors.
 Blue Revolution:
→ significant growth and intensification of global aquaculture production - domestication and farming of fish, shellfish,
and aquatic plants - from roughly 1950s to present, particularly in underdeveloped countries. rapid increase in
production of fish and marine product through package program. 1st began in China where fishing is ancient activity.
China accounts for around 2/3rd of total aquaculture production worldwide by weight and roughly ½ by market value.
Blue Revolution refers to time of intense growth of worldwide aquaculture industry from mid-1960s to present day.
→ Blue Revolution in India:
Page 61 of 719
  launched during 7th 5 Year Plan (FYP) [1985 – 90], during which government sponsored Fish Farmers
Development Agency (FFDA).
 During 8th FYP, from 1992-97, Intensive Marine Fisheries Program was launched.
 Over period of time, fishing harbours in Gujarat, TN, AP, Kerala, AN were established.
 Research centres were set up to increase production, improvement in fish species.
 River Ranching:
→ form of aquaculture in which some population of fish species (salmon etc) is held in captivity for 1 ststage of their
lives.
→ They are then released, and later harvested as adults when they return from sea to their freshwater birthplace to
spawn.
 Fish value chain:
→ It usually starts at harvesting stage at sea.
→ Then, catch is brought to landing sites / centres.
→ After processing, fish is marketed by wholesalers to retailers.
→ From retailers, it finally reaches to end users / consumers.
 Deep-sea fishing:
→ Activity of catching fish that live in deep parts of sea / ocean.
→ Fishing activities beyond 12 nautical miles from shore line.
→ Boats are designed so that fishermen get access to deeper parts of ocean and fish species.
→ practiced worldwide, especially in coastal areas with no ecological damage.
→ depth of water should be at least 30 meters to be considered deep sea fishing zone.
 Bottom trawling:
→ What:
 involves trawlers dragging weighted nets along sea-floor, causing great depletion of aquatic resources.
 This practice was started by Tamil Nadu fishermen in Palk Bay.
→ Impact:
 ecologically destructive practice
 Bottom trawling captures juvenile fish, thus exhausting ocean’s resources and affecting marine conservation
efforts.
→ Issue:
 Contention between India and Sri Lanka has been use of bottom trawlers by Tamil Nadu fishermen.
→ Initiative:
 Palk Bay Scheme [2017] under Blue Revolution
→ Way Forward:
 Solution to bottom trawling issue lies in transition from trawling to deep-sea fishing.
 Issues:
→ Fishermen complain of low catch in Bay of Bengal over last few years.
→ One reason for decreasing catch is marine pollution and cyclones.
→ Untreated effluents from pharmaceutical industries flowing into sea have affected marine life.
→ Boat owners need to invest about Rs. 3 lakh for every voyage.
→ Fishing is becoming to be loss-making trade for many boat owners.
 Challenges:
→ accurate data on assessment of fishery resources and their potential in terms of fish production
→ development of sustainable technologies for fin and shell fish culture
→ yield optimization
→ harvest and post-harvest operations
→ landing and berthing facilities for fishing vessels
→ welfare of fishermen.
 Iniatives:
→ Separate ministry for Fisheries (2019) - Ministry of Fisheries, Animal Husbandry and Dairying. Blue
revolution 2.0. Kisan credit card for fish farmers. Fisheries and aquaculture Infrastructure Development
fund (FIDF). Palk Bay Scheme [2017] under Blue Revolution. Pradhan Mantri Matsya Sampada Yojana
(PMMSY). National Fisheries Policy, 2020.
 Way Forward:
→ India had agreed in 2010 and 2016 to phase out practice of bottom trawling in Palk Strait.
Note:
 Palk Bay Scheme [2017]:
→ What:
 Diversification of trawl fishing boats from Palk Strait into deep sea fishing boats.
 transition from trawling to deep-sea fishing.
 launched under Blue Revolution programme.
Page 62 of 719
  The scheme is financed by the Union and the State Governments with beneficiary participation.
 It had envisaged the provision of 2,000 vessels in three years to the fishermen of the State and motivate them
to abandon bottom trawling.
 Centrally Sponsored Scheme.
→ Aim:
 encouraging fishermen to take up deep-sea fishing and put end to disputes arising between India and Sri Lanka.
→ Need:
 Bottom trawling.
→ Funding:
 Centre
 State governments
 institutional financing
 beneficiaries.
→ Deep Sea fishing plan:
 remove as many trawl vessels from Palk Bay as possible.
 beneficiaries should possess registered, seaworthy trawl vessel of over 12m in length that must be scrapped or
disposed of outside Palk Bay.
 And, new replacement tuna long liner boats cannot trawl or operate in Palk Bay.
 Beneficiaries are not allowed to sell their boats (tuna long liner boats) within 5 years of obtaining them.
→ Significance:
 remedy to Palk Bay fishing conflict.
 Centre feels that deep sea fishing is only solution to promote ecologically sustainable fishing and reduce fishing
pressure around close proximity of International Maritime Boundary Line (IMBL) and incidents of cross-border
fishing.
 Incentivises fishermen to venture deep into Indian Ocean, Arabian sea, other deep-sea areas to look for fish like
tuna that are in high demand.
→ Way Forward:
 Solution to bottom trawling issue lies in transition from trawling to deep-sea fishing.
 Pradhan Mantri Matsya Sampada Yojana (PMMSY):
→ What:
 scheme for focused and sustainable development of fisheries sector in India. bring about Blue
Revolution through sustainable and responsible development of fisheries sector in India. has both both
components - Central Sector Scheme (CS) and Centrally Sponsored Scheme (CSS). Ministry of Fisheries, Animal
Husbandry and Dairying. It aims to adopt ‘Cluster or Area-based Approaches’ and create fisheries clusters
through backward and forward linkages and to double export earnings to Rs. 1 lakh crore from fisheries sector
by 2024-25.
→ Aim:
 Integrated, sustainable, inclusive development of marine and inland fisheries.
 Enhance fish production.
 Increase fisheries export earnings
 Double incomes of fishers and fish farmers.
 Reduce post-harvest losses.
 Generate direct and indirect gainful employment opportunities in fisheries sector and allied activities.
 To bring about blue revolution through sustainable and responsible development of fisheries sector in India.
→ Need:
 Critical gaps in fisheries value chain.
 As human population is growing, requirement of high-quality protein & demand of fish is increasing.
→ Activities:
 beneficiary-oriented activities in Marine, Inland fisheries and Aquaculture.
 Development of infrastructure – fishing harbours, cold chain, markets etc.
 Cage culture, seaweed farming, ornamental fisheries, new fishing vessels.
 Fishing vessel insurance, Aquaculture in saline / alkaline areas, Sagar Mitras, FFPOs, Nucleus Breeding Centres,
etc.
→ Approach:
 Cluster or Area based approaches.
→ Focus:
 Islands, Himalayan States, NE, Aspirational districts
→ Funding:
 Union sanctioned about 20,000 crores to all States/Union Territories, as part of AatmaNirbhar Bharat Package.
→ Targets:

Page 63 of 719
  Enhance fish production by additional 70 lakh tonnes by 2024-25. Increase fisheries export earnings to Rs.
1,00,000 crore by 2024-25. Double incomes of fishers and fish farmers. Reduce post-harvest losses from 20-25%
to about 10%. Generate additional 55 lakhs of direct and indirect gainful employment opportunities in fisheries
sector and allied activities.
→ Program:
 Nationwide River Ranching Programme [2021]:
• What:
 special activity under Pradhan Mantri Matsya Sampada Yojana (PMMSY) scheme to augment and
enhance fish production and productivity by expanding, intensifying, diversifying and utilizing land &
water productively.
• Objective:
 To promote sustainable use and conservation of fishery resources in economical and environmentally
responsible manner.
• Need:
 As human population is growing, requirement of high-quality protein & demand of fish is increasing
gradually.
• Implementing agency:
 National Fisheries Development Board, Hyderabad (under central component of PMMSY).
• Signficance:
 Achieve sustainable fisheries
 conserving biodiversity
 assessing ecosystem services
 reducing habitat degradation
 maximizing social-economic benefits.
 upgradation of traditional fishery
 upgradation of trade & social protection of Inland communities and ecosystem sustainability.
→ Achievement:
 Fish production and exports have reached all-time high (over 74% contribution by inland fisheries, and 26% by
marine).
 Palk Bay:
→ semi-enclosed shallow water body between SE coast of India and Sri Lanka, with w ater depth maximum of
13 m.
Value Addition:
 Rainbow revolution:
→ integrated development of crop cultivation, horticulture, forestry, fishery, poultry, animal husbandry and food
processing industry.
Mains Link:
 Discuss the significance of the Pradhan Mantri Matsya Sampada Yojana.

SUNDARBANS
News:
 2022:
→ CAG audit report points out illegal construction and violations of environmental norms in two Ramsar sites
in West Bengal - East Kolkata Wetlands (EKW) and Sunderbans.
 Issue:
• Illegal constructions in EKW and Coastal Regulation Zone (CRZ) area in Sunderbans. However, such violations
even in these ecologically fragile areas are rarely found to have been penalised; except in compliance of
Kolkata High Court’s orders.
 Rule:
• CRZ notification disallows construction of residential buildings in No Development Zone.
About:
 What:
→ mangrove area in delta formed by confluence of Padma R., Brahmaputra R., Meghna R. in Bay of Bengal.
 Feature:
→ It spans area from Baleswar River in Bangladesh to Hooghly River in India's West Bengal. It comprises
closed and open mangrove forests, land used for agricultural purpose, mudflats and barren land, and is
intersected by multiple tidal streams and channels.
→ 4 protected areas in Sundarbans are enlisted as UNESCO World Heritage Sites, namely:
 Sundarbans West (Bangladesh)
 Sundarbans South (Bangladesh)
 Sundarbans East (Bangladesh)
 Sundarbans National Park (India).
Page 64 of 719
  Indian Sundarbans:
→ Feature:
 It covers about 4,200 km2 and includes Sunderban Tiger Reserve — home to about 96 royal Bengal tigers.
 It is world heritage site and Ramsar site.
 It is also home to large number of rare and globally threatened species, such as:
• northern river terrapin (CR)
• Irrawaddy dolphin (EN)
• fishing cat (VU)
 2 of world’s 4 horseshoe crab species, and 8 of India’s 12 species of kingfisher are also found here.
 Indian Sundarban is home to 2,626 faunal species and 90% of India’s mangrove varieties.
→ Issues:
 Patches of mangroves are being lost gradually and quietly due to their indiscriminate destruction for coastal
development or for short-term gains. [These mangroves patches are enriched habitats of several rare and
threatened flora and fauna].
 Continued loss of shoreline mangrove ecosystems has created fragmented and fragile mangrove habitats for
rare taxa and framed barriers to their movement and dispersal.
 This irreversible loss of biodiversity is often neglected, which could never be compensated with any ‘cut
established and plant new’ theory.
 In 2022, CAG audit report pointed out illegal construction and violations of environmental norms in
two Ramsar sites in West Bengal - East Kolkata Wetlands (EKW) and Sunderbans.
 Illegal constructions in EKW and Coastal Regulation Zone (CRZ) area in Sunderbans. However, such violations
even in these ecologically fragile areas are rarely found to have been penalised; except in compliance of Kolkata
High Court’s orders.
Note:
 East Kolkata Wetlands (EKW):
→ East Calcutta Wetlands.
→ complex of natural and human-made wetlands lying east of city of Calcutta (Kolkata), West Bengal, India.
→ unique peri-urban ecosystem that lies on eastern fringes of Kolkata.
→ cover 125 km2 and include salt marshes, agricultural fields, se wage farms, settling ponds.
→ These wetlands are also used to treat Kolkata's sewage.
→ Nutrients that is contain in its wastewater sustain fish farms and agriculture.
Mains Link:
 Discuss the impact of cyclone amphan on Mangroves in India.

HALLMARK
News:
 2021:
→ Government announces phased implementation of mandatory hallmarking of gold jewellery.
 1st phase:
• Gold hallmarking will be available only in 256 districts and jewellers having annual turnover above Rs. 40
lakh will come under its purview.
 Need for mandatory hallmarking:
• India is biggest consumer of gold. However, level of hallmarked jewellery is very low. Main reason is non-
availability of sufficient Assaying and Hallmarking Centres (A&HC).
• Mandatory hallmarking will protect public against lower caratage (non-purity) and ensure consumers do
not get cheated while buying gold ornaments.
• purity standard
• transparency
• quality.
 2022:
→ Vide Hallmarking of Gold Jewellery and Gold Artefacts (Amendment) Order, 2022, 2nd phase of mandatory
hallmarking starts.
 Feature:
• 2nd phase of mandatory hallmarking will cover additional 3 caratages of gold jewellery / artefacts namely
20, 23, 24 carats as mentioned in Indian Standard IS 1417.
• 2nd phase will cover 32 new districts under mandatory hallmarking regime wherein one Assaying and
Hallmarking Centres (AHC) has been set up under 1st phase of mandatory hallmarking order.
About:
 What:
→ Literal meaning - distinctiveness.

Page 65 of 719
 → Hallmark is official mark or series of marks struck on items made of metal, mostly to certify content of noble metals
— such as platinum, gold, silver and in some nations, palladium. In more general sense, term hallmark can also be
used to refer to any distinguishing mark.
→ According to BIS, Hallmarking is accurate determination and official recording of proportionate content of precious
metal in precious metal articles.
→ It is like guarantee of purity or fineness of precious metal articles.
→ Hallmarking is process of creating Hallmark.
 Significance:
→ Protection of public against lower caratage (non-purity) and ensuring consumers do not get cheated while buying
gold ornaments.
→ purity standard
→ transparency
→ quality.
 India:
→ India - biggest consumer of gold.
→ BIS operates gold and silver hallmarking scheme.
→ Metals covered under hallmarking:
 Gold jewellery and gold artefacts.
 Silver jewellery and silver artefacts.
→ Components of hallmarking on jewellery:
 BIS logo
 Purity of gold
 Assay Centre
 Jeweller’s identification mark
 Year of hallmarking
→ Exception:
 Export and re-import of jewellery as per Trade Policy of Government of Indi.
 Jewellery for international exhibitions
 jewellery for government-approved B2B domestic exhibitions.
 Watches, fountain pens, special types of jewellery like - Kundan, Polki, Jadau.
→ Need for mandatory hallmarking:
 India is biggest consumer of gold. However, level of hallmarked jewellery is very low - only 30% of Indian gold
jewellery is hallmarked. Main reason is non-availability of sufficient Assaying and Hallmarking Centres (A&HC).
 Mandatory hallmarking will protect public against lower caratage (non-purity) and ensure consumers do not get
cheated while buying gold ornaments.
 purity standard
 transparency
 quality.
Value Addition:
 Blood Gold:
→ Blood gold is gold that comes from Yanomami territory, Amazon.
→ Yanomami people, who live in settlement deep inside Amazon rainforest, have been threatened for several decades
by illegal gold miners who invade their land and bring diseases.
Mains Link:
 Discuss the need for hallmarking of gold in India.

VENUS
(GS1, GS3)
News:
 2018:
→ ESA proposes Venus missions - EnVision, Theseus, Spica.
 2020:
→ Presence of Phosphine gas observed on Venus, and thus indicates possible sign of life on Venus specially in its clouds.
→ Proposed Venus Orbiter Mission of ISRO - Shukrayaan Mission.
 2021:
→ Parker Solar Probe briefly swings around Venus using Venus’ gravity.
→ Parker Solar Probe measures 1 st direct measurement of Venusian atmosphere in nearly 30 years.
→ NASA announces 2 new missions to Venus:
 DAVINCI+ (Deep Atmosphere Venus Investigation of Noble gases, Chemistry, and Imaging) mission.
 VERITAS (Venus Emissivity, Radio Science, InSAR, Topography, and Spectroscopy) mission.
These 2 missions aim to understand how Venus became inferno-like world, capable of melting lead at surface.
Page 66 of 719
 → ESA says EnVision orbiter will be sent in 2030s to visit Venus.
 2022:
→ After sending missions to Moon and Mars, ISRO is now readying one spacecraft (Shukrayaan) to orbit Venus
to study what lies below surface of solar system’s hottest planet, and also unravel mysteries under Sulfuric
Acid clouds enveloping it. ISRO is planning to launch this mission in 2024.
About:
 Feature:
→ Venus rotates about its own axis very slowly.
→ Time taken by Venus to complete one rotation around its own axis > Time taken by Venus to complete one
revolution around Sun.( One day on Venus lasts longer than one year on Venus).
→ Venus rotates from east to west. [Only Venus and Uranus rotate backwards – east to west] i.e. Venus
rotates in direction opposite of its orbital / revolution path around Sun. It means, Sun rises in west and
sets in East.
→ 2 nd planet from Sun
→ No moon, no rings.
→ has toxic atmosphere consisting of carbon dioxide (CO2), clouds of sulfuric acid etc.
→ hottest planet in solar system (more hot than mercury due to greenhouse effect).
→ Venus’s surface is hot enough to melt lead.
→ 2nd-brightest object in night sky after moon. [because of its thick cloud cover that reflects and scatters
light].
→ Venus has thick atmosphere.
→
 Why study Venus:
→ Questions:
 What history did Venus experience that it has catastrophic greenhouse effect and does this foretell Earth’s fate
also?
 Is Venus still geologically active?
 Could Venus have once hosted ocean and even sustained life?
 Study about evolution of terrestrial planets in general, because astronomers discover more Earth-like exoplanets
today?
→ Venus is twin sister of Earth [similar sizes]:
 believed that both Venus and Earth have common origin - formed around 4.5 billion years ago.
 Born of similar processes.
 similar size (though Venus is slightly smaller than Earth).
 similar structure
 rocky
 Mass
 Density
 Composition
 gravity
→ Differences between Venus and Earth:
 After birth, their paths diverged.
 Venus lacks magnetic field.
 Venus’s surface broils at very high temperature, hot enough to melt lead.
→ Solar flux:
 Venus may help in study of solar flux because it experiences higher so lar flux than Earth.
 Parker Solar Probe’s findings:
→ Venus’ ionosphere:
 Like Earth, Venus also has electrically charged layer of gas at its upper atmosphere, called ionosphere.
→ Radio waves:
 This sea of charged gases, or plasma, in Venus’ ionosphere emits radio waves.
→ Implications:
 This discovery confirms that Venus’ upper atmosphere (Venus’s ionosphere) undergoes changes because
of solar cycle - Sun’s 11-year cycle.
 This may help to unravel how and why Venus and Earth are so different.
 Missions to Venus / Venus Mission:
→ Intro:
 Soviet Union – 1st to start missions to Venus.
→ EnVision:
 to study Venus’s atmosphere and surface
→ Venera series [Soviet].
Page 67 of 719
 → Magellan [1990]:
 Last US / NASA probe (orbiter) to visit planet Venus.
→ Venus Express [2005]:
 European mission.
→ Akatsuki [2010]:
 Japan.
→ DAVINCI+:
 Deep Atmosphere Venus Investigation of Noble gases, Chemistry, and Imaging
 One planned Venus mission
 NASA.
 It will measure Venus’s atmosphere so as to gain insight into how it formed and evolved.
 It will determine whether Venus ever had ocean.
 It will return 1st high resolution images of Venus’s “tesserae” geological features (These features could
be comparable to continents on Earth).
→ VERITAS:
 Venus Emissivity, Radio Science, InSAR, Topography, and Spectroscopy.
 One planned Venus mission to map surface of Venus in high resolution.
 NASA.
 It will map Venus’s surface to understand its geological history and investigate how it developed so
differently than Earth.
 It will use radar to chart surface elevations and discover whether volcanoes and earthquakes are still
happening.
→ Shukrayaan Mission:
 What:
• Shukrayaan-1 (transl. Venus craft) is planned orbiter to Venus (planned to be launched in 2024) by ISRO
to study surface and atmosphere of Venus.
 Objectives:
• surface investigation
• studying atmosphere.
• interaction between atmosphere and solar wind.
 Feature:
• It will orbit Venus and study what lies below surface of Venus, and also would try to unravel
mysteries under Sulfuric Acid clouds enveloping it.
Value Addition:
 Atmospheric super-rotation:
→ when planet's atmosphere rotates faster than planet itself.
→ Example:
 Atmosphere of Venus.
 Atmosphere of Titan, largest moon of Saturn.
→ Scientists believed that Earth's thermosphere has small super-rotation.
→ Scientiets also suggest that global warming is likely to cause increase in super-rotation in future, including possible
super-rotation of surface winds.
Mains Link:
 Discuss why NASA’s latest missions to Venus are significant.
 Discuss the objectives and significance of Shukrayaan mission.

NOISE POLLUTION / ENVIRONMENTAL NOISE / SOUND POLLUTION

News:
 2020:
→ Allahabad High Court holds that though Azaan may be essential and integral part of Islam, giving call to
prayer through loudspeakers or other sound-amplifying devices can not be said to be integral part of
religion warranting fundamental rights protection enshrined in Article 25, which is even otherwise subject
to public order, morality or health and other provisions of Part III of Constitution.
 2022:
→ New controversy emerges in Maharashtra after Maharashtra Navnirman Sena (MNS) chief Raj Thackeray
raised issue of loudspeakers in mosques and warned that if they are not removed, his par ty would play
Hanuman Chalisa out loud. [Maharashtra government might bank on provisions of Noise Pollution
(Regulation and Control) Rules, 2000 to go about this controversy].
→ Allahabad High Court says use of loudspeaker from mosque is not fundamental right.
About:
 What:
Page 68 of 719
 → propagation of noise with ranging impacts on activity of human or animal life, most of them harmful to
some degree.
→ Air (Prevention and Control of Pollution) Act, 1981 considers noise as ‘air pollutant’.
→ According to Central Pollution Control Board, noise is anything that is unwanted sound that causes
annoyance, irritation, pain to human ear.
 Source:
→ machines, transport, propagation systems, poor urban planning, side -by-side industrial and residential
buildings, loud music, transportation (traffic, rail, airplanes, etc.), lawn care maintenance, construction,
electrical generators, wind turbines, explosions, people.
 Impact:
→ It impacts health of people.
→ According to WHO, about 1.1 billion young people (aged between 12 –35 years) are at risk of hearing loss
due to noise exposure.
→ WHO stated that noise exposure at night causes sleep disturbance and noise-induced sleep disturbance is
viewed as health problem.
→ WHO stated that disturbed sleep causes fatigue, accidents, reduced performance.
→ Various physical disorders due to higher noise include temporary deafness, headache, increase in blood
pressure.
 India:
→ Law:
 Air (Prevention and Control of Pollution) Act, 1981 considers noise as ‘air pollutant’.
 According to Central Pollution Control Board, noise is anything that is unwanted sound that causes annoyance,
irritation, pain to human ear.
 Noise pollution and its sources are regulated under Noise Pollution (Regulation and Control) Rules, 2000 under
Environment (Protection) Act, 1986.
 Environment (Protection) Act, 1986 defined ambient acceptable noise levels, restrictions on use of loudspeakers,
sound-emitting construction equipment, horns, bursting of crackers and so on.
→ Acceptable level of noise:
 In industrial areas, ceiling is fixed at 75dB during daytime (6 am to 10 pm) and 70dB during nighttime (10 pm to
6 am).
 In commercial areas, noise limitation is fixed at 65 dB during daytime and 55 dB during nighttime.
 In residential areas, they are 55 dB during daytime and 45 dB during night.
 In silence zones, same is at 50dB during daytime and 40dB during night.
→ Laws around loudspeakers:
 Central Pollution Control Board listed fines for violation of noise pollution norms, including use of loudspeakers
or public addresses.
 Noise level at boundary of public place, where loudspeaker or public address system or any other noise source
is being used, shall not exceed 10 dB (A) above ambient noise standards for area or 75 dB (A), whichever is lower.
 Rules also state that loudspeaker or public address system shall not be used except after obtaining written
permission from designated authority.
 Exemption: State government can provide exemption during any cultural or religious festive occasion of limited
duration not exceeding 15 days in all during calendar year.

BIRD
News:
 2021:
→ IUCN, BirdLife International says about 160 species of 557 raptor species around world are threatened by
extinction to some degree.
→ Central Asian Flyway (CAF) range countries held meeting.
 2022:
→ Punjab could not conduct its annual waterbird census due to dense fog conditions. Instead one species
richness survey is conducted with support from WWF-India.
→ BirdLife International publishes State of World’s Birds report.
→ Every year, light pollution contributes to the death of millions of birds.
About:
 Waterbirds:
→ What:
 birds that are ecologically dependent on wetlands.
→ Significance:
 Waterbirds are important indicator of health of wetlands.
 Migration:

Page 69 of 719
 → What:
 adaptation mechanism to help birds overcome weather adversities and unavailability of food in colder regions.
→ Migratory species:
 animals that move from one habitat to another during different times of year, due to various factors - food,
sunlight, temperature, climate, etc.
 migratory route can involve nesting
 migratory route requires availability of habitats.
→ Flyway:
 geographical region within which single or group of migratory species completes its annual cycle – breeding,
moulting, staging, non-breeding.
 route regularly used by large numbers of migrating birds
 key flight paths of migratory birds
 There are 9 flyways in world:
• Central Asian Flyway (CAF):
 covers large area of Eurasia between Arctic Ocean and Indian Ocean (about 30 countries)
 There are 30 countries under CAF, including India.
 comprises several important migration routes of waterbirds:
o Northernmost grounds:
✓ Russia (Siberia)
✓ Breeding grounds.
o Southernmost grounds:
✓ West Asia, India, Maldives, British Indian Ocean Territory.
✓ Non-breedings wintering grounds.
 Birds using CAF:
o Black-necked crane
o Bar-headed goose
o Black-winged Pratincole
o Caspian Plover
o Spot-billed Pelican
o Brown-headed Gull
o Ibisbill
o Indian Skimmer
o Sociable lapwing
o Relict Gull
 India falls within CAF.
 Significance:
o Every winter, many birds make their way to India through Central Asian flyway.
• …..
 Need to protect Flyways:
• Approximately 1 in 5 of world’s bird species migrate, some covering enormous distances.
• Safeguarding flyways means protecting birds from poachers, rejuvenating wetlands. Saving wetlands,
terrestrial habitats help in fulfilling bigger purpose of saving ecosystem.
→ Challenges faced by migratory birds:
 habitat loss globally.
 Decreased water bodies, wetlands, natural grasslands, forests.
 Increased weather variability and climate change [resulting in loss of biodiversity]
→ Significance:
 Destination of migratory birds indicates health of that ecosystems / destination.
 Saving migratory birds means saving wetlands, terrestrial habitats, ecosystem and thus benefiting communities
dependent on wetlands.
→ Way Forward:
 Conservation of migratory birds
 Cooperation and coordination along entire Central Asian Flyway (CAF) between countries and across national
boundaries.
 Threats to Birds of Prey (Raptor):
→ Reason:
 habitat loss
 pollution
 toxic substances
 human–wildlife conflicts
 collisions with aerial structures

Page 70 of 719
  electrocution by power lines
 climate change.
→ during their long annual journeys from their breeding grounds to wintering areas and vice versa.
→ Example:
 Philippine eagles (largest variety of eagles in world), decreased rapidly in last decades due to extensive
deforestation.
 Vulture populations declined in Asian countries - India etc. because of diclofenac.
 Convention on Migratory Species (CMS) / Bonn Convention [1979]:
→ to protect migratory species throughout their range countries
→ under UNEP
→ provides global platform for conservation and sustainable use of migratory animals and their habitats
→ brings together states through which migratory animals pass, range states, and lays legal foundation for
internationally coordinated conservation measures.
→ Species classification:
 Appendix I:
• threatened with extinction
• strictly protecting these animals
Appendix II:
• species that need or would benefit from international co-operation.
→ Significance:
 only global and UN-based intergovernmental organization established exclusively for conservation of migratory
species throughout their range.
 World Migratory Bird Day (WMBD):
→ organized by – CMS
→ to raise global awareness about threats faced by migratory birds, their ecological importance, need for
international cooperation to conserve them.
 Initiative:
→ India’s National Action Plan for Conservation of Migratory Birds and their Habitats along Central Asian
Flyway (2018-23):
 Aim:
• to reduce population decline of migratory birds
• to secure habitat of migratory birds.
• conserve migratory birds and their habitats within agenda of SDGs.
 to be implemented by Ministry of Environment Forest and Climate Change
 Components:
• Species conservation
• Habitat conservation and sustainable management
• Communication and outreach
• Capacity development
• Research and knowledge base development
• International cooperation.
Note:
 BirdLife International [1922]:
→ Global partnership of NGOs that strives to conserve birds and their habitats.
→ One NGO and Global partnership of conservation org. that strives to conserve birds, their habitats, and
global biodiversity.
→ It is one Global Partnership of Conservation Organizations.
→ It identifies sites known / referred to as ‘Important Bird and Biodiversity Areas’.
→ Its priorities include preventing extinction of bird species, identifying and safeguarding important sites for
birds, maintaining and restoring key bird habitats, and empow ering conservationists worldwide.
→ Headquarters - UK.
 State of World’s Birds report:
→ flagship science publication of BirdLife International.
→ peer-reviewed journal.
→ It uses birds to assess condition of our ecosystems as whole.
→ 2022 State of World’s Birds report:
 Finding:
• Around 48% of bird species worldwide are known or suspected to be undergoing population declines.
• In India, nearly 80% bird species are declining in numbers, and almost 50% falling strongly.
• Around 57% of North American species are recording declining trends.
• In European Union, 378 species indicate overall decrease in breeding bird abundance.
Page 71 of 719
 • Bird species and abundance data from tropics is scarce but in many countries such as India, citizen science
driven data was available.
 Reasons behind this decline:
• expanding human footprint on natural world and climate change.
• degradation and loss of natural habitat
• direct overexploitation of many species.
Value Addition:
 Asian Waterbird Census (AWC):
→ Annual event in which volunteers across Asia and Australiacountwaterbirds in wetlands of their resp.
countries.
→ coordinated by Wetlands International (WI)
→ part of International Waterbird Census (IWC).
→ Aim:
 Monitor status of waterbirds and wetlands.
→ India:
 Annually coordinated by Bombay Natural History Society (BNHS) and WI.
Mains Link:
 What is Waterbird Census in India? Discuss.

WHEAT
News:
 2022:
→ Russia’s invasion of Ukraine and subsequent western sanctions on Russia have affected wheat exports from
Black Sea and impacts food security in several countries, especially in Africa, West Asia. Disruption to
global wheat supplies in turn has thrown open opportunities that India’s grain exporters are eyeing,
especially given domestic surplus availability of wheat cereal.
→ Wheat procurement by government agencies is set to dip to 15 -year low in current marketing season, from
all-time high scale in 2021.
 Reason:
• Rise in export demand: Mainly fuelled by 2022 Russia – Ukraine war, which led to skyrocketing prices and
further increase in demand for Indian grain. Farmers find it more profitable to export now. Lower
production: Sudden spike in temperatures when crop was in grain-filling stage, with kernels still
accumulating starch, protein and other dry matter — has taken toll on yields.
 Impact:
• This would affect minimum operational stock-cum-strategic reserve of government agencies. This would
affect PDS, midday meals, other regular welfare schemes. Farmers will certainly benefit from this scenario
as they are being offered price above MSP. Amid 2022 Russia-Ukraine crisis, new markets in countries like
Israel, Egypt, Tanzania, Mozambique have opened up for India. However, on other hand, if private traders
continue to buy above MSP, eventually that could stoke inflation.
About:
 Intro:
→ Wheat is grass widely cultivated for its seed, cereal grain which is worldwide staple food. Many species of
wheat together make up genus Triticum. Archaeological record suggests that wheat was 1 st cultivated in
regions of Fertile Crescent (in Middle East) around 9600 BCE. Botanically, wheat kernel is type of fruit
called caryopsis.
 Feature:
→ 2 nd most important cereal crop in India, after rice. rabi crop. requires cool growing season and bright
sunshine at time of ripening. Temperature: Between 10-15°C (Sowing time) and 21-26°C (Ripening &
Harvesting) with bright sunlight. Rainfall: Around 75-100 cm. Soil Type: Well-drained fertile loamy and
clayey loamy (Ganga-Satluj plains, black soil region of Deccan).
 Top wheat producing countries:
→ China, India, Russia, United States, Canada, France, Pakistan, Ukraine, …
 Top wheat exporting countries:
→ Russia, Canada, United States, France, Ukraine, …
 India:
→ Production, consumption:
 India is 2nd largest producer of wheat, after China. India expects to produce 112 million tonnes of wheat in 2022
season. India government requires 24-26 million tonnes per year for its food security programmes.
→ Factors that led to increase in Wheat cultivation in Ind ia:
 Success of Green Revolution contributed to growth of Rabi crops, especially wheat. Macro Management of
Agriculture Scheme [2001], National Food Security Mission [2007], Rashtriya Krishi Vikas Yojana [2007].

Page 72 of 719
 → Export:
 India’s wheat exports in 2021-22 financial year were at 7.85 million tonnes. India’s wheat exports in 2022-23 are
expected to be almost 10 million tonnes.
 Initiative:
• Commerce Ministry has put in place one internal mechanism to facilitate wheat export and get paperwork
ready for related sanitary and phytosanitary applications to help facilitate shipments. Railways are providing
rakes on priority to move wheat. Railways, ports, and testing laboratories are all geared up to meet wheat
export requirements.
→ Importance of India for world:
 More countries are turning to India because of competitive price, acceptable quality, availability of surplus
wheat, geopolitical reasons (2022 Ukraine invasion etc). Egypt, Jordan, East Africa are also likely to source wheat
from India.
Question:
 Wheat can be grown without burning residue e.g. using happy seeders.
Mains Link:
 Discuss the need for and significance of wheat exports from India.

TISSUE CULTURE
News:
 2022:
→ Agricultural and Processed Food Products Export Development Authority (APEDA) conducts webinar on
“Export Promotion of Tissue Culture Plants such as Foliage, Live Plants, Cut Flowers, and Planting Material ”.
[DBT-accredited tissue culture laboratories in India participated in this Webinar].
About:
 What:
→ In biological research, tissue culture refers to method in which fragments of plant or animal tissue are
introduced into new, artificial environment, where they continue to function or grow.
→ Tissue culture is growth of tissues or cells in artificial medium separate from parent organism. This
technique is also called micropropagation. This is typically facilitated via use of liquid, semi -solid, or solid
growth medium, such as broth or agar.
→ Tissue culture commonly refers to culture of animal cells and tissues, with more specific term plant tissue
culture being used for plants.
→ Term "tissue culture" was coined by American pathologist Montrose Thomas Burrows.
→ It is culturing plant seeds, organs, explants, tissues, cells, or protoplasts on chemically defined synthetic nutrient
media under sterile and controlled conditions of light, temperature, humidity.
 Type:
→ Seed Culture:
 Type of tissue culture that is primarily used for plants such as orchids.
 For this method, explants (tissue from plant) are obtained from in-vitro derived plant and introduced in to
artificial environment, where they get to proliferate.
→ Embryo Culture:
 Type of tissue culture that involves isolation of embryo from given organism for in vitro growth.
→ Callus Culture:
 Callus is term used to refer to unspecialized, unorganized and dividing mass of cells. Callus is produced when
explants (cells) are cultured in appropriate medium.
 Example - tumor tissue that grows out of wounds of differentiated tissues / organs.
→ Organ Culture:
 Type of tissue culture that involves isolating organ for in vitro growth. Here, any organ plant can be used as
explant for culture process (shoot, root, leaf, flower).
→ Protoplast Culture:
 Protoplasts are cells without cell walls. Protoplast is term used to refer to cell (fungi, bacteria, plant cells etc) in
which cell wall has been removed, which is why they are also referred to as naked cells.
 Plant Tissue Culture:
→ Advantage:
 It quickly produces mature plants.
 It allows plants to be moved with greatly reduced chances of transmitting diseases, pests, pathogens. [But, there
are some risk of pest attacks.]
 It makes possible for storage of genetic plant material to safeguard native plant species.
→ India:
 Trade:

Page 73 of 719
 • In 2020-21, India’s exports of tissue culture plants stood at USD 17.17 million, with Netherlands accounting
for around 50% of shipments.
• Top 10 countries importing tissue culture plants from India are Netherlands, USA, Italy, Australia, Canada,
Japan, Kenya, Senegal, Ethiopia, Nepal.
 Issues / challenges:
• Tissue culture plant laboratories face following challenges:
 Increasing power costs.
 Low efficiency levels of skilled workforce in laboratories.
 Contamination issues in laboratories.
 Cost of transportation of micro-propagated planting material.
 Lack of harmonization in HS code of Indian planting material with other nations.
 Objections raised by forest and quarantine departments to export of live planting material.
 Initiative:
• Government is encouraging export of tissue culture plants:
 APEDA is running one Financial Assistance Scheme (FAS) to help laboratories upgrade themselves so as
to produce export quality tissue culture planting material.
 Govt. also facilitates exports of tissue culture planting material to diversified countries through market
development, market analysis and promotion and exhibition of tissue culture plants at international
exhibitions and by participating in buyer-seller meets at different international forums.
Mains Link:
 Discuss the concerns associated with Plant Tissue Culture.

ENDOSULFAN
News:
 2022:
→ Supreme Court slams Kerala government for its inaction in providing relief to Endosulfan pesticide
exposure victims. [This also amounts to breach of apex court’s 2017 judgment, which had ordered Kerala
State to pay Rs. 5 lakh each to victims in 3 months].
About:
 What:
→ Off-patent organochlorine insecticide and acaricide pesticides that is being phased out globally.
→ It is one widely-banned pesticide with hazardous effects on human genetic and endocrine systems.
 Ban:
→ It became highly controversial agrichemical due to its acute toxicity, potential for bioaccumulation, and
role as endocrine disruptor. Because of its threats to human health and environment, global ban on
manufacture and use of endosulfan was banned under 2001 Stockholm Convention in 2011, with certain
uses exempted for 5 additional years. More than 80 countries, including EU, Australia, New Zealand,
several West African nations, USA, Brazil, Canada had already banned it or announced phase -outs by time
Stockholm Convention ban was agreed upon.
→ It is still used extensively in India and China despite laws against its use. It is also used in few other
countries. It is produced by Israeli firm Makhteshim Agan and several manufacturers in India and China. In
2011, Supreme Court of India ordered ban on production and sale of endosulfan in India, pending further
notice.
 Feature:
→ It does not occur naturally in environment.
→ It is listed under 1998 Rotterdam Convention on Prior Informed Consent.
→ Its use is banned by 2001 Stockholm Convention on Persistent Organic Pollutants.
→ In 2011, Supreme Court in India banned manufacture, sale, use, and export of endosulfan throughout India,
citing its harmful health effects.
 Usage:
→ Agrichemical as pesticide: It is sprayed on crops like cotton, cashew, fruits, tea, padd y, tobacco etc. for
control of pests in agriculture such as whiteflies, aphids, beetles, worms etc.
 Impact:
→ On humans:
 It affects human genetic and endocrine systems (It acts as endocrine disruptor).
 It is known carcinogen, neurotoxin and genotoxin (damages DNA).
 It blocks inhibitory receptors of Central nervous system (CNS), disrupts ionic channels and destroys integrity of
nerve cells.
→ On environmental:
 acute toxicity, potential for bioaccumulation
 Endosulfan in environment gets accumulated in food chains leading to higher doses causing problems.

Page 74 of 719
  If Endosulfan is released to water, it is expected to absorb to sediment and may bioconcentrate in aquatic
organisms.
Note:
 Kerala:
→ From 1970s, Kerala villages used aerial spraying of endosulfan on its agriculture fields especially cashew
nut plantation. Locals reportedly experienced illnesses, paralysis and deformities.
Mains Link:
 Discuss about the effects of Endosulfan on human health and Environment.

BLACK HOLE
News:
 2021:
→ With help of ASTROSAT (1 st Indian space observatory) among others, Astrophysicists in India spotted by
rare merging of 3 supermassive black holes.
 Significance:
• Many Active Galactic Nuclei (AGN) pairs have been detected in past. But, triple AGN are extremely rare, and
only few has been detected till now.
 2022:
→ Scientists from Event Horizon Telescope (EHT) facility reveals 1 st image of black hole at centre of Milky
Way. This image of black hole referred to as Sagittarius A* (Sgr A*) gives further support to idea that
compact object at centre of our galaxy is indeed black hole.
→ India’s Astrosat space telescope has witnessed birth of black hole in space for 500th time.
About:
 What:
→ region of spacetime where gravity is so strong that nothing – no particles or even electromagnetic radiation
such as light – can escape from it.
→ object / region in space that is so dense and has such strong gravity that no matter, not even light can
escape its pull. Because no light can escape, it is black and invisible.
→ According to NASA, gravity in black hole is so strong because matter is squeezed into tiny space. This can
happen when star is dying.
 Feature:
→ Theory of general relativity predicts that sufficiently compact mass can deform spacetime to form black
hole. Boundary of no escape is called event horizon. Although it has great effect on fate and circumstances
of object crossing it, it has no locally detectable features according t o general relativity. In many ways,
black hole acts like ideal black body, as it reflects no light. Moreover, quantum field theory in curved
spacetime predicts that event horizons emit Hawking radiation, with same spectrum as black body of
temperature inversely proportional to its mass. This temperature is of order of billionths of kelvin for
stellar black holes, making it essentially impossible to observe directly.
 Event horizon:
→ What:
 In astrophysics, event horizon is boundary beyond which events cannot affect observer. Wolfgang Rindler coined
this term in 1950s.
 Boundary at edge of black hole, which is point of no return — any light or matter that crosses that boundary is
sucked into that black hole.
 Boundary of no escape. Boundary at edge of black hole.
 Boundary defining region of space around black hole from which nothing (not even light) can escape.
In other words, escape velocity for object within event horizon exceeds speed of light. Name arises
since it is impossible to observe any event taking place inside it – it is horizon beyond which we cannot
see. Event horizon therefore effectively hides singularity at centre of black hole.
→ Feature:
 Black hole’s event horizon is point of no return beyond which anything — stars, planets, gas, dust and
all forms of electromagnetic radiation—gets dragged into oblivion.
 Anything that crosses event horizon is destined to fall to very centre of black hole and be squished
into one single point with infinite density, called singularity.
 Although event horizon has great effect on fate and circumstances of object crossing it, it has no locally
detectable features according to general relativity.
 Quantum field theory in curved spacetime predicts that event horizons emit Hawking radiation, with
same spectrum as black body of temperature inversely proportional to its mass. This temperature is
of order of billionths of kelvin for stellar black holes, making it essentially impossible to observe
directly
 Singularity:

Page 75 of 719
 → Anything that crosses event horizon is destined to fall into black hole and be squished into single point
with infinite density, called singularity.
→ At singularity, laws of physics breakdown.
Note:
 Event Horizon Telescope (EHT) [2006]:
→ What:
 Large telescope array consisting of global network of radio telescopes.
→ Genesis:
 In 2006, international team of more than 200 researchers, led by Harvard University astronomers,
launched EHT project
→ Aim:
 To capture direct shot of black hole.
→ Feature:
 EHT project combines data from several very-long-baseline interferometry (VLBI) stations around
Earth, which form combined array with angular resolution sufficient to observe objects size of
supermassive black hole's event horizon.
 This project's observational targets include 2 black holes with largest angular diameter as observed
from Earth: black hole at center of supergiant elliptical galaxy Messier 87 ( M87*) and Sagittarius A*
at center of Milky Way.
 It consists of 8 radio observatories around world, includ ing telescopes in Spain, US, Antarctica.
 Black hole, gravitational wave, dark matter, gravitational microlensing:
→ When gravitational wave approaching earth is interrupted by presence of black hole (acting as gravitational
lens), said gravitational wave signal get modified. This effect will change shape of gravitational wave signals
that are received on earth. Scientists can then use received gravitational wave signals to confirm presence
of black hole.
 Final parsec problem:
→ If 2 galaxies collide, their black holes will also come closer by transferring kinetic energy to surrounding
gas.
→ Distance between blackholes decreases with time until separation is around 1 parsec (3.26 light years).
→ Said 2 black holes are then unable to lose any kinetic energy further t o get even closer and merge.
→ This is known as final parsec problem.
 Discovery of rare merging of 3 supermassive black holes in 2021 by Indian astrophysicists:
→ Significance:
 Presence of 3 rd black hole solves final parsec problem:
• Said 2 black holes can come closer and merge fully when another (3rd) black hole or star passes by and takes
away some of their combined angular momentum.
• Thus, said 2 merging blackholes merge with each other in presence of 3 rd black hole.
 Sagittarius A* (Sgr A*):
→ Sagittarius A star is supermassive black hole at Galactic Center of Milky Way.
→ It is located near border of constellations Sagittarius and Scorpius.
→ It possesses 4 million times mass of our Sun and is located about 26,000 light -years from Earth.
 Active Galactic Nuclei (AGN):
→ supermassive black hole at centre of galaxy
Value Addition:
 Active Galactic Nucleus (AGN):
→ compact region at center of galaxy that has much -higher-than-normal luminosity over at least some
portion of electromagnetic spectrum with characteristics indicating that luminosity is not produced by
stars. Such excess non-stellar emission has been observed in radio, microwave, infrared, optical, ultra -
violet, X-ray and gamma ray wavebands.
→ Galaxy hosting AGN is called "active galaxy". Non-stellar radiation from AGN is theorized to result from
increase of matter by supermassive black hole at center of its host galaxy.
 Quasar / Quasi-Stellar Object (QSO):
→ extremely luminous active galactic nucleus (AGN), powered by supermassive black hole, with mass ranging
from millions to billions of solar masses, surrounded by gaseous accretion disc. Gas in disc falling towards
black hole heats up because of friction and releases energy in form of electromagnetic radiation. Radiant
energy of quasars is enormous; most powerful quasars have luminosities 1000 of times greater than that
of galaxy such as Milky Way. Usually, quasars are categorized as subclass of more general category of AGN.
Redshifts of quasars are of cosmological origin.
 Tidal Disruption Event (TDE):
→ Astronomers study Blackholes by watching for their effects on nearby stars and gas.
→ TDEs are phenomena in which stars are disrupted when blackhole’s tidal gravity exceeds star’s self -gravity.

Page 76 of 719
 → TDEs are crucial and useful phenomena to detect and predict mass of supermassive black holes in dormant
galaxies.
Mains Link:
 Discuss the applications and significance of findings of the Laser Interferometer Gravitational-Wave Observatory (LIGO)
detector.
 What do you understand by Quasar? What do quasars have to do with black holes? Explain.

ATMANIRBHAR BHARAT ABHIYAN / SELF-RELIANT INDIA MISSION

News:
 2022:
→ Union Minister of Commerce and Industry Shri Piyush Goyal talks about local supply chains at WEF Davos meet
(2022), in Switzerland. He says Indian industry should strengthen domestic supply chains by sourcing supplies locally
and we should not excessively depend on international supply chains and should ask businesses to procure goods
locally “whenever there’s opportunity”.
About:
 What:
→ Self-reliant India.
→ It is phrase Prime Minister Modi and his government used and popularised in relation to India's economic
development plans. This phrase is one umbrella concept for Modi government's plans for India to play
larger role in world economy, and for it to become more efficient, competitive , and resilient.
→ campaign launched by Central Government which included one Rs. 20 lakh crore economic stimulus
package and many reform proposals.
→ Economic relief package focusing on reviving Indian economy and making India self -reliant.
 Feature:
→ Based on principles of self-reliance, it focuses on:
 land
 labour
 liquidity
 laws.
→ 5 Pillars:
 Economy:
• PM Modi said government’s endeavour is towards building economy that brings quantum jump rather than
incremental change.
 Infrastructure:
• PM Modi said infrastructure should be world-class which becomes identity of modern India.
 Technology-driven system:
• Prime Minister focussed on technology-driven system which can fulfill dreams of 21st century; system not
based on policy of past century.
 Vibrant Democracy:
• PM Modi termed India’s vibrant demography as India’s strength. He said it is source of energy for self-reliant
India.
 Demand:
• PM Narendra Modi said cycle of demand and supply chain in Indian economy, is strength which needs to be
harnessed to its full potential. He said, in order to increase demand in India and to meet this demand, every
stake-holder in our supply chain needs to be empowered. We will strengthen our supply chain, our supply
system built up with smell of our soil and sweat of our labourers.
→ 5 phases:
 Phase-I: Businesses including MSMEs
 Phase-II: Poor, including migrants and farmers
 Phase-III: Agriculture
 Phase-IV: New Horizons of Growth
 Phase-V: Government Reforms and Enablers
→ Stages:
 Atmanirbhar Bharat Abhiyan 1.0
 Atmanirbhar Bharat Abhiyan 2.0
 Atmanirbhar Bharat Abhiyan 3.0
• Jobs
• Farmers
• Salaried taxpayers
• Infrastructure
• Stressed assets
Page 77 of 719
 → Other sectors:
 Poor people, urban poors and migrants
 Health Sector
 Tax concessions
 RBI’s Covid 19 Economic Relief Package
 MSMEs
 NBFCs
 DISCOMS
 Agriculture – market, governance and administrative reforms, infrastructure.
 Mining
 Defence
 Civil aviation
 MGNREGS
Mains Link:
 What is ‘Atmanirbhar Bharat Abhiyan’? Discuss the significance of self-reliance and self-efficiency in the times of crisis
like the COVID pandemic.
 Indian industry should strengthen domestic supply chains rather than relying on external sources. Critically analyze.

WILD BOAR / WILD SWINE / COMMON WILD PIG / EURASIAN WILD PIG / WILD PIG
News:
 2022:
→ Kerala government empowers local bodies to cull wild boars that pose threat to agriculture crops or human
life. Secretaries of local bodies concerned will act as delegated officers.
About:
 What:
→ Wild pig native to much of Eurasia and North Africa, and has been introduced to Americas and Oceania.
→ Wild boars probably originated in SE Asia during Early Pleistocene and outcompeted other boar species as
they spread throughout Old World.
 Feature:
→ one of widest-ranging mammals in world.
→ IUCN – LC [due to its wide range, high numbers, adaptability to diversity of habitats].
 Example:
→ Indian boar:
 also known as Andamanese pig / Moupin pig.
 subspecies of wild boar native to India.
 They can also be spotted in some of National Parks and Wildlife Sanctuary such as Sariska Tiger Reserve
(Rajasthan), Bandhavgarh National Park (MP), Corbett National Park (Uttarakhand), Ranthambore National Park
(Rajasthan).
 Concern:
→ It has become invasive species in part of its introduced range.

WORLD ECONOMIC FORUM (WEF) [1971]

News:
 2022:
→ Union Minister of Commerce and Industry Shri Piyush Goyal talks about local supply chains at WEF Davos meet
(2022), in Switzerland. He says Indian industry should strengthen domestic supply chains by sourcing supplies locally
and we should not excessively depend on international supply chains and should ask businesses to procure goods
locally “whenever there’s opportunity”.
→ WEF announces one new ‘Alliance of CEO Climate Action Leaders India’ that will work towards fast-tracking de-
carbonisation pathways along India’s net-zero journey.
→ WEF releases Travel & Tourism Development Index 2021: Rebuilding for Sustainable and Resilient Future.
→ WEF releases Global Gender Gap Report, 2022.
About:
 What:
→ international non-governmental and lobbying organization based in Cologny, Geneva, Switzerland.
→ It was founded in 1971 by German engineer and economist Klaus Schwab.
→ Swiss nonprofit foundation
 Mission:
→ Improving state of world by engaging business, political, academic, and other leaders of society to shape
global, regional, and industry agendas.
 Funding:

Page 78 of 719
 → It is mostly funded by its 1,000 member companies – typically global enterprises with more than 5 billion
US dollars in turnover – as well as public subsidies.
 Feature:
→ It is international institution for public-private cooperation.
 Reports:
→ Energy Transition Index.
→ Global Competitiveness Report.
→ Global Information Technology Report [WEF along with INSEAD, and Cornell University publishes this
report].
→ Global Gender Gap Report.
→ Global Risks Report.
→ Travel & Tourism Development Index.
Note:
 Alliance of CEO Climate Action Leaders India [2022]:
→ Indian CEOs’ Alliance on Climate Action
→ To fast-track India’s climate action and de-carbonisation efforts i.e., to supercharge race to Net Zero.
→ Participants: It is collaboration between Kearney Company (global company) and Observer Research Foundation
(Indian company) and brings together chief executives from India’s leading businesses.
→ This Alliance is part of WEF’s Climate Action Platform and will build upon learnings from global projects such as WEF’s
Alliance of CEO Climate Leaders and First Movers Coalition.
 Alliance of CEO Climate Leaders [2014]:
→ This Alliance / project is one global community of Chief Executive Officers (CEO) who continue to set bar higher and
catalyse action across all sectors and engage policymakers to help deliver transition to net-zero economy.
→ It is part of WEF’s Climate Action Platform.

JUNE, 2022
GOVERNMENT E-MARKETPLACE (GEM)
News:
 2022:
→ Union Cabinet clears proposal allowing cooperatives to sell products on Government-e-Marketplace (GeM)
platform.
 Impact:
• This move will benefit 27 crore people associated with 8.5 lakh cooperatives.
• MSME will get buyers and it will boost prospects of “Vocal for local” and Atma Nirbhar Bharat.
→ Cooperatives have been onboarded on GeM portal, thus allowing them to procure like other government
agencies. Until now, cooperatives were purchasing from open market.
About:
 What:
→ It is one stop portal to facilitate online procurement of common use Goods and Services. gem.gov.in/. It
has been developed by Directorate General of Supplies and Disposals (Ministry of Commerce and Industry).
 Feature:
→ This portal is open for all government buyers — Central and State Ministries, departments, public sector
enterprises, etc.
→ Private buyers cannot buy on this platform but private people can sell products to government bodies
through this portal.
→ Nodal Ministry - Ministry of Commerce and Industry.
 Significance:
→ Transparent and Cost-effective Procurement.
→ Promotion of Atmanirbhar Bharat.
→ Entry of Small Local Sellers.
Mains Link:
 Discuss the significance of GeM.

LEADERSHIP GROUP FOR INDUSTRY TRANSITION (LEADIT)

News:
 2022:
→ India and Sweden host Industry Transition Dialogue in Stockholm, as part of their joint initiative i.e. Leadership for
Industry Transition (LeadIT).
About:
 What:

Page 79 of 719
 → LeadIT gathers countries and companies that are committed to action to achieve 2015 Paris Agreement. It was
launched by governments of Sweden and India at 2019 UN Climate Action Summit and is supported by WEF.
 Objective:
→ LeadIT members subscribe to notion that energy-intensive industry can and must progress on low-carbon pathways,
aiming to achieve net-zero carbon emissions by 2050.
 Members:
→ Currently, this Group has membership of 16 countries and 19 companies including Dalmia Cement, Mahindra Group,
SpiceJet from India.
 Function:
→ Management Board is made up of representatives from Sweden, India, and WEF. One Technical and Expert
Committee, made up of LeadIT member representatives, advises this Board. Management Board also decides on
workplan of LeadIT Secretariat. LeadIT Secretariat is responsible for managing work of Leadership Group and is
hosted by Stockholm Environment Institute (SEI). Also, Management Board approves new members.
 Significance:
→ Industry sectors together contribute about 30% of total CO2 emissions. Hence, initiatives like LeadIT to drive low
carbon development pathways in industry sector are critical for achieving goals of 2015 Paris Agreement.

RADIO FREQUENCY IDENTIFICATION (RFID)

News:
 2022:
→ Indian Army starts implementation of RFID tagging of its ammunition inventory.
→ In view of heightened security threats to Amarnath pilgrimage, RFID tags will now be used to track Amarnath pilgrims.
→ Baggage tags equipped with RFID will soon be available at Delhi’s Indira Gandhi International Airport, marking 1 st of
its kind for India.
About:
 What:
→ Method that uses electromagnetic fields (radio waves) to automatically identify and track tags attached to objects.
→ RFID system consists of:
 radio transponder
 radio receiver
 transmitter.
→ RFID is one wireless tracking system that consists of tags and readers.
 Feature:
→ When triggered by electromagnetic interrogation pulse from nearby RFID reader device, tag transmits digital data,
usually identifying inventory number, back to reader. This number can be used to track inventory goods.
→ Radio waves are used to communicate information / identity of objects or people.
→ Tags can carry encrypted information, serial numbers and short descriptions.
 Type:
→ Passive RFID tag:
 Passive RFIDs are activated through reader using electromagnetic energy it transmits.
→ Active RFID tag:
 Active RFIDs use their own power source, mostly batteries.
 Mechanism:
→ RFID tags use integrated circuit and antenna to communicate with reader using radio waves at several different
frequencies – low frequency (LF), high frequency (HF), ultra-high frequency (UHF).
→ Message sent back by tag in form or radio waves is translated into data and analysed by host computer system.
→ Unlike Barcodes, RFIDs do not require direct line of sight to identify objects.
→ Basic RFID system has Computer database, RFID Reader, Antenna, RFID Tag.
Note:
 FASTAG:
→ What:
 electronic toll collection system
 operated by National Highway Authority of India (NHAI)
 It is affixed on windscreen of vehicle
 It employs Radio Frequency Identification (RFID) technology
 Payment of tolls directly from prepaid / savings account of vehicle owner.
 It enables vehicles through toll plazas, without stopping for transactions.
 part of National Electronic Toll Collection (NETC) programme.
 NPCI collects payment.
→ Working Mechanism:
 RFID transponder / RFID tag is attached on windscreen of vehicle.
Page 80 of 719
  When vehicle approaches toolbooth, RFID reader at toolbooth sends radio waves that activates RFID tag on
vehicle.
 Activated RFID tag sends vehicle information to RFID reader.
 RFID reader sends vehicle information to lane controller.
 Lane controller deducts toll fee from vehicle owner.
→ Need:
 Smoother passing through tolls because no longer vehicle stoppage etc.
 Passenger Safety:
• Security cameras at toll booths will take photos of passengers in vehicle
• record of vehicle’s movement.
 Barcode / Bar Code:
→ Method of representing data in visual, machine-readable form. Initially, barcodes represented data by
varying widths, spacings and sizes of parallel lines. These barcodes, now commonly referred to as linear or
one-dimensional (1D), can be scanned by special optical scanners, called barcode readers, of which there
are several types. Later, two-dimensional (2D) variants were developed, using rectangles, dots, hexagons
and other patterns, called matrix codes or 2D barcodes, although they do not use bars as such. 2D barcodes
can be read using purpose-built 2D optical scanners, which exist in few different forms. 2D barcodes can
also be read by digital camera connected to microcomputer running software that takes photographic
image of barcode and analyzes image to deconstruct and decode 2D barcode. Mobile device with inbuilt
camera, such as smartphone, can function as latter type of 2D barcode reader using specialized application
software.
→ Barcode is printed series of parallel bars or lines of varying width used f or entering data into computer
system.
→ Bars are black on white background and vary in width and quantity depending on application.
→ Bars represent binary digits zero and one, which represent the digits zero to nine processed by a digital
computer.
→ These barcodes are scanned using special optical scanners known as barcode readers.
→ The majority of these codes use only two different widths of bars, however some use four.
→ One of the most well-known examples of a barcode is the QR code.
 RFID vs Barcode:
→
{RFID} {Barcode}
RFID uses radio waves to Barcodes use light to read black-
communicate that do not require and-white pattern printed on
line of sight in order to obtain sticky tag.
data.
RFID tag can communicate with
powered reader even when tag is
not powered.
RFID tags are more durable than When printed on paper or sticky
barcodes. labels, barcodes are more
susceptible to wear and
breakage, which can affect their
readability.
In contrast to barcode scanners,
RFID scanners can process
dozens of tags in 1 second.
RFID is more complicated and Barcodes are simple and easy to
difficult to replicate or copy or counterfeit.
counterfeit.
RFID tags are expensive
compared to barcodes.
Line of sight: Not required. Required.
Read range: In terms of feet. (longer) In terms of inches. (shorter)
Read rate: Many simultaneously Only 1 at one time.
Identification: Can uniquely identify each item / Most barcodes only identify type
asset tagged. of item but not uniquely.
Read / Write: Many RFID tags are Read / Write. Read only.
Technology: RF (Radio Frequency) Optical (Laser)

Page 81 of 719
 Interference: Metals, liquids can interfere with
some RF frequencies.
Automation: Most fixed readers don’t require
human involvement to collect
data (automated).
Obstructed barcodes cannot be
read (dirt covering barcode, torn
barcode, etc.)
Most barcode scanners require
human to operate (labor
intensive)

GREEN BOND
News:
 2021:
→ PFC Ltd. (leading NBFC in power sector) issues its 1 st ever Euro Green Bonds.
 Note:
• 1st ever Euro denominated Green bond issuance from India.
• 1st ever Euro bond issuance by Indian NBFC.
→ Corporate green-bond issuance reaches new highs as U.S. companies (Micron, Wa lmart etc.) add green
bonds as part of larger traditional bond offerings.
→ State Bank of India (SBI) (India’s largest commercial bank) dual listed its USD X million green bonds
simultaneously on India International Exchange (India INX) and Luxembourg Stock Exchange (LuxSE).
 2022:
→ In her Budget speech, Finance Minister Nirmala Sitharaman announces that government plans to issue
sovereign green bonds so as to mobilise resources for green infrastructure.
→ India to issue at least Rs 24,000 crore in sovereign green bonds as India marks shift towards low-carbon
economy.
→ India is likely to face uphill battle if it goes ahead with its 1 st sovereign green bond sale as it aims to issue
securities in rupees, putting off most overseas investors.
 Issue:
• Timing might not be ideal for India though, especially for rupee issuance.
• Rupee currency has slumped more than 4% this year (2022) amid concern RBI is behind curve in tackling
inflation, with elevated crude oil prices adding to pressures on net importer.
→ Markets regulator SEBI proposes concept of blue bonds as one mode of sustainable finance, saying such securities
can be utilised for various blue economy-related activities, including oceanic resource mining and sustainable fishing.
About:
 What:
→ one fixed-income instrument / security that is specifically earmarked to raise money for climate and
environmental projects. Greeen bonds finance environmentally friendly projects. It is used to fund projects
that have +ve environmental and / or climate benefits.
 Feature:
→ asset-linked
→ backed by issuing entity’s balance sheet
→ may come with tax incentives [to enhance their attractiveness to investors].
 Working mechanism:
→ Green bonds work just like any other corporate or government bonds.
→ Borrowers issue Green Bond securities [so as to secure financing for environmental projects (ecosystem
restoration, reducing pollutionetc)]
→ Investors who purchase Green Bonds make money at maturity.
→ Also, there are usually tax benefits for investing in Green Bonds.
 Significance:
→ Sovereign green bond (Sovereign guarantee to green bond) issuance sends powerful signal of intent around
climate action and sustainable development to governments, regulators.
→ Sovereign green bond will catalyze domestic market development and will provide impetus to institutional
investors.
→ Sovereign green bond will provide benchmark pricing, liquidity, demonstration e ffect for local issuers, and
thereby helping to support growth of local market.
→ Help in reducing carbon intensity of economy.
 India:
→ Green bonds of India are rupee-denominated papers.
→ Indian green bonds will fund green infrastructure projects.
→ Indian green bonds are issued so as to mobilise resources for green infrastructure.
→ India plans to issue at least Rs 24,000 crore in sovereign green bonds as India marks shift towards low -
carbon economy.
→ In 2015, Yes Bank became 1 st Indian Bank to issue Green Infrastructure Bonds (GIBs) in India.

Page 82 of 719
 → Need:
 India’s green bond is importance as India is planning to fund renewable energy projects that will help meet its
goal of net-zero emissions by 2070.
 Globally, there is boom in sustainable investments.
 India is world’s 3rd-biggest emitter of greenhouse gases (GHG).
 India plans to quadruple its renewable power generation capacity by 2030.
Note:
 World Bank is major issuer of green bonds.
 Climate Bonds:
→ Green bonds and Climate Bonds are sometimes used interchangeably, but these two terms are not always
synonymous.
→ But, some authorities use term Climate Bonds specifically for projects focusing on:
 reducing carbon emissions
 reducing effects of climate change.
 Blue Bonds:
→ What:
 Blue bonds are one innovative ocean financing instrument whereby funds raised are earmarked
exclusively for projects deemed ocean-friendly. Blue bonds are sustainability bonds to finance projects
that protect ocean and related ecosystems such as supporting sustainable fisheries, protection of coral
reefs and other fragile ecosystems, reducing pollution, reducing acidification, ….
→ Feature:
 It will be one debt instrument to support investments in healthy oceans and blue economies (i.e. use
of ocean resources for economic growth) - sustainable exploitation of ocean resources, fishing, and
extracting renewable energy. It will catalyse progress towards SDG 14 (Life Below Water).
→ Fact:
 All Blue Bonds are Green Bonds, but not all Green Bonds are Blue Bonds.
 1 st Blue Bond: Seychelles, in 2018, was 1 st to come with one sovereign blue bond.
Mains Link:
 Discuss the significance of Green Bonds.

SPACE
News:
 2019:
→ ISRO says India will soon have its own space station.
 2021:
→ As part of Gaganyaanprogramme, Indian astronaut-candidates undergoing space flight training in Russia.
→ Russia to launch its own orbital space station in 2025.
→ OneWeb company - global communications company working to deliver broadband satellite internet
services worldwide, launches satellites.
 Using LEO satellites, OneWeb seeks to offer connectivity across Canada, Alaska, Greenland, UK, Northern
Europe, Arctic Seas.
 Programme is called ‘Five to 50’ service [internet connectivity to all regions north of 50 degrees latitude].
→ As part of SpaceX cargo resupply mission, NASA sends squids (squids glow-in-dark) and tardigrades (water bears) to
International Space Station.
 Reason:
• Study about protective measures for astronauts going on long-duration space travel.
• Study benefits of interaction between microbes and animals [to improve human health on Earth].
 Why send microbes?
• Microbes play crucial role:
 in normal development of animal tissues.
 in maintaining human health.
 In human body, microorganisms help in digestion, immune system development, detoxifying harmful
chemicals. Disruption in this relationship can lead to diseases.
• Study will help better understand how beneficial microbes interact with animals in lack of gravity.
→ ISRO announces that 1stuncrewedGaganyaan launch has been delayed due to COVID-19 pandemic in India.
→ Nauka launched by Russia from Kazakhstan. Nauka would be integrated with International Space Station (ISS).
→ Virgin Galactic, American spaceflight company launches Unity 22 into space, with crew, and flew to edge
of space.
→ SpaceX to launch ‘Inspiration4’ (It will take 4 private citizens into space for 3 days).
→ Blue Origin conducted online auction for seat alongside Jeff Bezos onboard New Shephard.
→ Australia will support India’s ‘Gaganyaan’ mission by tracking it through Cocos Keeling island.
Page 83 of 719
 Need:
• Satellite in orbit cannot pass along its information to ground station on Earth if it does not have clear view
of that ground station.
• Thus, data relay satellite is needed to pass along orbit satellite’s information.
 Importance:
• There are blind spots due to which there is possibility of not receiving signals. Data relay satellite tracking
from Cocos Keeling island is expected to help address this issue.
→ Amazon CEO Jeff Bezos back on earth after flight to space on New Shepard spacecraft of Blue Origin.
→ Prime Minister formally launches Indian Space Association (ISpA).
→ China complains to UN about space incidents involving its Tiangong Space Station and Starlink satellites
(from Elon Musk-founded aerospace firm, SpaceX).
 2022:
→ ISRO successfully conducted qualification test of Cryogenic Engine for Gaganyaan programme at ISRO Propulsion
Complex (IPRC) in Tamil Nadu.
→ ISRO conducts successful qualification test of its High Thrust VIKAS Engine.
→ Amid 2022 Ukraine war, Russian space agency threatens that Russia could respond to US sanctions by letting ISS fall
from space.
→ Both Voyager spacecraft are rushing away from Earth and into interstellar space. Yet for portion of every year, both
spacecrafts’ distances to Earth decrease.
→ Estimated size of India’s space economy, as % of GDP, has slipped from 0.26% in 2011-12 to 0.19% in 2020-21.
→ ISRO completes test of Human-rated Solid Rocket Booster (HS200) for Gaganyaan programme.
→ NASA’s Voyager 1 is continuing its journey beyond our Solar System, 45 years after it was launched. But now this
veteran spacecraft is sending back strange data, puzzling its engineers. One malfunction is said to be behind this. This
glitch has to do with Voyager 1’s attitude articulation and control system, or AACS, which keeps this spacecraft and
its antenna in proper orientation. Preliminary analysis suggests that this craft is confused about its location in space.
→ 3 Chinese astronauts docked at its space station - Tiangong.
→ In another important milestone in Gaganyaan project, ISRO successfully carries out test-firing of Low Altitude Escape
Motor (LEM) of Crew Escape System, from Sriharikota, Andhra Pradesh.
→ GOI informs Lok Sabha that India's share in the estimated USD 360-billion global space economy is approximately
2%. Jitendra Singh, the Hon’ble Minister for Department of Space says India has acquired indigenous capabilities in
the space sector across all domains, including space transportation systems, and space assets comprising a fleet of
satellites catering to the needs of earth observation, satellite communication, meteorology, space science,
navigation.
→ A top official says India's space sector accounts for 2% of the global space economy, but can aim to touch 8% on the
back of hard work by the private sector with hand holding from space agency ISRO.
→ ISRO's heaviest rocket LVM3 (earlier called GSLV Mk III) launches British start-up OneWeb's 36 broadband satellites
from the spaceport in Andhra Pradesh's Sriharikota, marking LVM3 launcher's entry into the global commercial
launch service market. [India's Bharti Enterprises is a major investor and shareholder in OneWeb].
About:
 Space laws:
→ UN Committee on Peaceful Uses of Outer Space is forum for development of international space law. This Committee
concluded, on space-related activities, 5 international treaties:
 Outer Space Treaty [1967].
 Rescue Agreement [1968].
 Space Liability Convention [1972].
 Registration Convention [1976].
 Moon Agreement [1979]; and
→ 5 principles:
 Declaration of Legal Principles.
 Broadcasting Principles.
 Remote Sensing Principles.
 Nuclear Power Sources Principles / NPS Principles.
 Benefits Declaration.
 UN Office for Outer Space Affairs [1958]:
→ focal point for international cooperation in peaceful exploration and use of outer space.
 Outer Space Treaty [1967]:
→ What:
 Treaty on Principles Governing Activities of States in Exploration and Use of Outer Space, including Moon and
Other Celestial Bodies
 multilateral treaty
 It forms basic framework of international space law.
Page 84 of 719
  agreed through UN
 many countries are parties— including all major spacefaring nations.
 It is like ‘constitution’ of outer space.
 India – member.
→ Provision:
 exploration and use of outer space shall be for benefit of all countries
 Space is not subject to claim by any particular nation
 States shall be responsible for national space activities whether carried out by governmental or non-
governmental entities
 States shall avoid harmful contamination of space and celestial bodies.
 nations will be liable for damage caused by their space objects (satellites).
→ Significance:
 Its principles has facilitated orderly conduct of activities in outer space.
 Space Station:
→ What:
 large spacecraft that remains in low-earth orbit (LEO) for extended periods of time.
 habitable artificial satellite
 Each crew member stays aboard space station for weeks or months, but rarely more than year.
→ Purpose:
 assist in performing in-depth study of space - observation of sun, space objects.
 long term researches for human health about possibilities of Mars, Moon supporting human existence.
 to test technology that could supplement or replace astronaut spacewalks - robonaut.
 used for military reconnaissance.
→ Presently, there are 2 space stations in space:
 International Space Station (ISS) [1998]:
• What:
 modular space station (habitable artificial satellite) in low Earth orbit.
 ISS is scheduled to be decommissioned after 2024 to leave place for Lunar Gateway.
• Launched by:
 Canada
 United States
 European Space Agency
 Russia
 Japan
• Feature:
 ISS circles Earth about 15 times per day [about 90 mins per circuit].
 ISS orbits at altitude of about 430 km.
 ISS is 9th space station to be inhabited by crews. [some space stations were - Salyut, Almaz, Mir, Skylab,
Destiny, Quest]
 among most ambitious international collaborations in human history.
• Regulation:
 Legal structure that regulates ISS is multi-layered. Primary layer establishing obligations and rights
between ISS partners is Space Station Intergovernmental Agreement (IGA), 1998. This 1998 is:
o international treaty signed in 1998 by governments involved in ISS project.
o long term international co-operative framework on basis of genuine partnership, for detailed
design, development, operation, utilization of permanently inhabited civil Space Station for
peaceful purposes, in accordance with international law.
• Who owns ISS?
 1998 Intergovernmental Agreement (IGA)allows ISS partners states to extend their national jurisdiction
in outer space.
 Basic rule is that each ISS partner shall retain jurisdiction and control over elements it registers and over
personnel in or on ISS who are its nationals.This means that owners of ISS –United States, Russia,
European Partner, Japan, Canada – are legally responsible for respective elements they provide.
• Who is liable in case something goes wrong?
 International Space Station legal framework recognises fundamental liability rules concerning space
activities, mentioned in international space law treaties, like Space Liability Convention [1972].
 Intergovernmental Agreement (IGA) establishes ‘cross-waiver of liability’ which prohibits any of 5 ISS
Partners or their related entities (contractor, sub-contractor, user, customer) to claim against another
Partner (or its related entities) for damage sustained as result of ISS activities.
 Each Partner is required to implement this obligation in contracts with its own contractors and sub-
contractors.

Page 85 of 719
 •Significance:
 ISS serves as microgravity.
 ISS serves as space environment research laboratory.
 Inside ISS, scientific experiments are conducted - astrobiology, astronomy, meteorology, physics etc.
 Tiangong 2 [2016]:
• by China
• will operate in low-Earth orbit (LEO).
• Tianhe – Tiangong 2’s core module / component
• This Chinese station will be smaller than ISS and similar in design, meaning it will have limited capacity for
astronauts (3 versus 6 on ISS).
• Significance:
 China’s eye from sky, providing round clock bird’s-eye view for its astronauts on rest of world.
 Aids China’s aim to become major space power by 2030.
 It replicates ISS, from which China was excluded.
• Concern:
 Equipped with robotic-arm. US has raised concerns for its robotic-arm possible military applications.
This technology could be used in future for seizing other satellites.
 Until Lunar Gateway is launched, Tiangong will probably remain only functioning space station. Some
worry this makes it security threat, arguing its science modules could be easily converted for military
purposes, such as spying on countries.
→ Planned space stations:
 Lunar Gateway
 Russian Orbital Service Station - scheduled to begin construction in 2025.
 Starlab Space Station - planned LEO space station designed by Nanoracks (USA) for commercial space activities
uses.
 Indian Human Spaceflight Programme: India plans to deploy one 20-tonne space station as follow-up
programme of Gaganyaan mission, it will be deployed in 5–7 years after completion of Gaganyaan project. Also,
India is planning to launch its own space station by 2030.
→ Significance:
 collecting meaningful scientific data, especially for biological experiments.
 scientific studies.
 study effects of long-term space flight on human body.
 Space mission / mission to space / missions to space:
→ Voyager program / Voyager Interstellar Mission (VIM) [1977]:
 It consists of:
• Voyager 1 [1977]:
 space probe
 launched by NASA as part of Voyager program
 to study outer Solar System and interstellar space beyond Sun's heliosphere.
 Launched some days after its twin Voyager 2
 It still communicates with Deep Space Network to receive routine commands and to transmit data to
Earth.
 It is most distant artificial object from Earth.
 1st spacecraft to enter interstellar space
• Voyager 2 [1977]:
 space probe
 launched by NASA to study outer planets and interstellar space beyond Sun's heliosphere.
 part of Voyager program
 launched some days before its twin, Voyager 1
 only spacecraft to have visited combination of either of gas giants and both ice giant planets.
 One of 5 spacecraft to achieve Solar escape velocity, which allowed it to leave Solar System.
 2nd spacecraft to enter interstellar space.
 Fact:
• Probes were only meant to explore outer planets – but they just kept on going.
• Mission objective of Voyager Interstellar Mission (VIM) is to extend NASA exploration of solar system
beyond neighborhood of outer planets to outer limits of Sun’s sphere of influence, and possibly beyond.
• Voyager spacecrafts are 3rd and 4th human spacecrafts to fly beyond all planets in our solar system. Pioneer
10 and Pioneer 11 preceded Voyagers in outstripping gravitational attraction of Sun. Voyager 1 passed
Pioneer 10 to become most distant human-made object in space.
 Both Voyager spacecraft are rushing away from Earth and into interstellar space. Yet for portion of
every year, both spacecrafts’ distances to Earth decrease. Reason:

Page 86 of 719
 • For few months each year, Earth in its orbit moves toward Voyager spacecrafts faster than they’re moving
away. Earth’s motion around sun is faster than motion of Voyager spacecrafts.
• So, for some portion of year, Earth comes around side of sun and is speeding toward spacecrafts faster than
they’re moving away.
• Therefore, their distances to Earth are getting closer, though only temporarily. They never change their
outward motion. It is we who change.
 Accomplishments:
• Voyager 2 is only probe ever to study Neptune and Uranus during planetary flybys.
• Voyager 2 is only spacecraft to have visited all 4 gas giant planets — Jupiter, Saturn, Uranus, Neptune —
and discovered 16 moons, as well as phenomena like Neptune’s mysteriously transient Great Dark Spot,
cracks in Europa’s ice shell, ring features at every planet.
→ Inspiration4 [2021]:
 What:
• human spaceflight mission
• circling Earth for 3 days, and then coming down into Atlantic Ocean.
• 1stall-civilian
• non-governmental spaceflight
• will orbit Earth higher than International Space Station (ISS), Hubble space telescope.
 Significance:
• collecting large amounts of health data [aid in planning future crewed space missions].
• assessingbehavioural and cognitive changes over journey.
• to open up space travel to non-professionals.
→ Unity 22 [2021]:
 What:
• sub-orbital spaceflight of class VSS Unity.
• by Virgin Galactic, American spaceflight company.
• 22nd mission for VSS Unity.
 Objective:
• testing cabin and customer experience.
 Uniqueness of VSS Unity Spaceship:
• air-launched from carrier plane – “White Knight Two”, used to lift SpaceShipTwo spacecraft by climbomg to
altitude, enough to give passengers few minutes of weightlessness and view of Earth’s curvature from edge
of space.
 Significance for India:
• Sirisha Bandla, astronaut born in India, is part of crew. This is significant because she will be 3rd woman of
Indian origin to go to space, after Kalpana Chawla, Sunita Williams.
→ Gaganyaan [India]:
 What:
• India’s 1 st manned / crewed orbital spacecraft / flight to space.
• intended to be foundation spacecraft of Indian Human Spaceflight Programme.
• ISRO
• Australia will support India’s Gaganyaan mission by tracking it through Cocos (Keeling) island
(Australia). This is important because there are blind spots because of w hich there is possibility of
not receiving signals. Data relay satellite tracking from Cocos (Keeling) island will help address this
issue.
• It will be powered by VIKAS engine.
 Origin:
• Formal announcement was made by Prime Minister Narendra Modi during his Independence Day
address on 15 August, 2018.
• Initial target was to launch before 75th anniversary of India’s independence (before 15 August,
2022).
 Objectives:
• to demonstrate capability to send humans to low earth orbit (LEO) on board Indian lau nch vehicle
and bring them back to earth safely.
 Component:
• Uncrewed:
 to test end-to-end capacity for manned mission.
• crewed
 Launch:
• by GSLV Mk III (ISRO’s heavy-lift launcher).

Page 87 of 719
 •4 Indian astronaut-candidates got generic space flight training in Russia as part of Gaganyaan
programme.
• 3 flights will be sent into orbit - 2 unmanned flights and 1 human spaceflight. Orbital Module will
have 3 Indian astronauts, including 1 woman. It will circle Earth at LEO at altitude of 300 -400 km
from earth for 5-7 days.
 Concern:
• There are blind spots due to which there is possibility of not receiving signals.
 Significance / Relevance of Manned Space Mission for India:
• Boost to industries:
 Gaganyaan Mission is expected to use nearly 60% of its equipment from Indian private sector.
• Employment:
 Gaganyaan mission would create about 15,000 new employment opportunities, mostly in private
industry.
• Research and development:
 Gaganyaan mission will thrust significant research in areas like:
o Space technology
o astro-biology
o planetary chemistry etc.
• Motivation:
 Human space flight will provide inspiration to youth of India, public of India.
• Prestige:
 India could potentially become 4thcountry to launch human space mission.
 Gaganyaan could make India key player in space industry.
• With this launch, India will become 4 th nation in world to launch Human Spaceflight Mission after
USA, Russia, China.
• It would be one of cheapest manned spaceflights in world.
 Fact:
• India plans to call its astronauts “Vyomnauts” since Vyom in Sanskrit means space.
• Low Altitude Escape Motor (LEM):
 LEM is one distinctive special purpose solid rocket motor of ISRO meant for Gaganyaan project. Crew
Escape System (CES) takes away Crew module of Gaganyaan mission in case of any eventuality and
rescues astronauts. In case of mission-abort during initial phase of flight, LEM provides required thrust
to CES, to take away Crew Module from launch vehicle.
 Concerns:
→ crowding of orbital space by these multiple launches, in may lead to space debris.
→ may lead to increase in space debris
→ Space-related conflicts occurred in past and will most likely continue to happen in future as well, considering growing
number of activities in space. [2021 example of ISS and Tiangong case].
→ High speed debris in Earth’s orbit can cause international incidents in outer space.
 India:
→ India’s space economy / space economy of India:
 Estimated size of India’s space economy, as % of GDP, has slipped from 0.26% in 2011-12 to 0.19% in 2020-21.
 In relation to GDP, India’s spending is more than that of China, Germany, Italy, Japan, but less than U.S., Russia.
 Indian space sector is globally recognized for building cost-effective satellites, launching lunar probes and taking
foreign satellites to space.
 Global space economy is estimated at USD 423 billion. Currently, India constitutes about 2-3% of global space
economy and is expected to enhance its share to >10% by 2030 at Compound annual growth rate (CAGR) of
48%.
 Status:
• In 2022, GOI informed Lok Sabha that India's share in the estimated USD 360-billion global space economy
was approximately 2%.
• In 2022, Jitendra Singh, the Hon’ble Minister for Department of Space said India had acquired indigenous
capabilities in the space sector across all domains, including space transportation systems, and space assets
comprising a fleet of satellites catering to the needs of earth observation, satellite communication,
meteorology, space science, navigation.
• In 2022, a top official said India's space sector accounted for 2% of the global space economy, but could aim
to touch 8% on the back of hard work by the private sector with hand holding from space agency ISRO.
• ISRO generated over the USD 167 mn revenue in 2014-19.
→ Space Station of India:
 India’s space station will be smaller than ISS.
 It will be used for carrying out microgravity experiments (not for space tourism).

Page 88 of 719
  Plan is to accommodate astronauts for up to 20 days in space.
 It will be extension of Gaganyaan mission.
 It will orbit Earth in LEO (around 400 km).
 ISRO is working on space docking experiment / technology (Spadex), which is crucial for making space station
functional.
→ Advantages of India in space sector:
 large talent pool
 growing prowess of home grown technology startups, private enterprises
 India has potential to become space technology leader and service provider to global space industry.
→ Indian Space Association (ISpA) [2021].
 What:
• quasi-public trade association for Indian space and satellite manufacturing companies
• premier industry association of space and satellite companies.
 Aim:
• ISpA aims to be forum of space industry in Indian private sector and partner Government of India and other
key stakeholders across space industry in making India self-reliant in space industry and in making India
become global space service provider.
• ISpA aims to contribute to Government of India’s vision of making India Atmanirbhar and global leader in
space arena.
 Composition:
• leading home grown and global corporations with advanced capabilities in space and satellite technologies.
• founding members:
 Bharti Airtel
 Larson & Toubro (L&T)
 Nelco (Tata Group)
 OneWeb
 …
 Functions:
• engage with stakeholders for formulation of enabling policy framework that fulfils Government’s space
vision.
• building global linkages for Indian space industry [to bring in critical technology and investments into India
to create more high skill jobs].
• coordination with IN-SPACe to further the space vision of the Government.
 Significance:
• Help in giant leap in space arena.
• Globally, private enterprise are increasingly contributing to unlocking possibilities of space.
→ Initiative:
 India has supported private participation through IN-SPACe, NewSpace India Ltd. (NSIL), proposed Indian Space
policy, Indian Space Association (ISpA) (2021).
→ Way Forward for India in space sector:
 Reforms in Indian Space sector:
• Since independence, Indian space has been dominated by single umbrella of Indian government and
government institutions.
• India scientists have made huge achievements in these decades.
• But, need of hour is that there should be no restrictions on Indian talent, whether it is in public sector or in
private sector.
• Besides, according to ISRO, India accounts for only about 2% of global space economy with potential to
capture 9% of global space market share by 2030.
Note:
 HS200:
→ Human-rated Solid Rocket Booster
→ This booster engine is part of GSLV Mk III rocket that will carry Indian astronauts to space.
→ world’s 2 nd largest operational booster using solid propellants.
→ In 2022, ISRO completed test of Human-rated Solid Rocket Booster (HS200) for Gaganyaan programme.
 New Shephard:
→ What:
 suborbital launch vehicle
 vertical-takeoff, vertical-landing (VTVL), crew-rated suborbital launch vehicle developed by Blue Origin as
commercial system for suborbital space tourism. [Blue Origin is owned and led by Amazon founder and former
CEO Jeff Bezos].
 rocket system meant to take tourists to space.
Page 89 of 719
 → Feature:
 Name New Shepard makes reference to 1stAmerican astronaut in space, Alan Shepard.
 built by Blue Origin (Amazon founder Jeff Bezos’s space company).
 named after astronaut Alan Shephard - 1st American to go to space.
 offers flights to space over 100 km (Karman Line) above Earth.
 fully reusable space vehicle.
 vertical takeoff space vehicle.
 vertical landing space vehicle.
 It took its 1st flight in 2015.
→ Objectives:
 to take astronauts, research payloads past Karman line.
 Easier, cost-effective access to space - meant for academic research, corporate technology development,
entrepreneurial ventures etc.
→ Significance:
 Experiencing zero-g and travelling above Karman Line.
 Interstellar space:
→ What:
 Space beyond Sun’sheliosphere.
 “Inter” – between
 “Stellar” – stars.
 space outside the reach of the solar winds in a planetary system. Its edge is called the Heliopause and as yet isn’t
definitively calculated — we’ve got probes working on it!
→ Boundary:
 Interstellar space begins from place in space where Sun’s constant flow of material and magnetic field stop
affecting its surroundings. This place in space is called - heliopause.
 Beyond place in space where heliosphere ends.
 heliopause is mark where interstellar space begins. Although depending on how one defines our solar system it
can stretch all way to Oort Cloud.
→ Voyager 1 – 1st spacecraft to enter interstellar space.
→ Voyager 2 – 2nd spacecraft to enter interstellar space.
 Heliosphere:
→ It is magnetosphere, astrosphere and outermost atmospheric layer of Sun.
→ It takes shape of vast, bubble-like region of space.
→ In plasma physics terms, it is cavity formed by Sun in surrounding interstellar medium.
→ This "bubble" of heliosphere is continuously "inflated" by plasma originating from Sun, known as solar
wind. Outside heliosphere, this solar plasma gives way to interstellar plasma permeating Milky Way.
→ As part of interplanetary magnetic field, heliospher e shields Solar System from significant amounts of
cosmic ionizing radiation; uncharged gamma rays are however not affected.
→ Scientific study of heliosphere is heliophysics, which includes space weather, space climate.
→ Heliosphere is bubble around sun created by outward flow of solar wind from sun and opposing inward
flow of interstellar wind. This heliosphere is region influenced by dynamic properties of sun that are carried
in solar windsuch as magnetic fields, energetic particles, solar wind plasma. Heliopause marks end of
heliosphere and beginning of interstellar space.
 Interstellar medium:
→ In astronomy, interstellar medium is matter and radiation that exist in space between star systems in
galaxy. This matter includes gas in ionic, atomic, and molecular form, as well as dust and cosmic rays.
→ It fills interstellar space and blends smoothly into surrounding intergalactic space.
→ Energy that occupies same volume, in form of electromagnetic radiation, is interstellar radiation field.
 VIKAS Engine:
→ High thrust engine.
→ liquid fuelled rocket engine.
→ used in PSLV, GSLV series of space launch vehicles.
→ It will power ambitious Gaganyaan mission into space.
 Tiangong-1:
→ China's 1st prototype space station.
→ orbited Earth from 2011 to 2018
→ served as both crewed laboratory and experimental testbed to demonstrate orbital rendezvous and
docking capabilities
 Nauka:
→ space laboratory
→ means science in Russian
Page 90 of 719
 → biggest space laboratory ever for Russia
→ Nauka will replace Pirs.
→ Nauka will serve as Russia’s main research facility on ISS.
→ Nauka will bring to ISS:
 oxygen generator
 spare bed
 toilet
 robotic cargo crane [built by European Space Agency (ESA)].
→ On ISS, Nauka will be attached to Zvezda module.
 Pirs:
→ Russian module on ISS
→ used as docking port for spacecraft and as door for cosmonauts to go out on spacewalks.
 Zvezda module:
→ provides all of ISS’s life support systems
→ serves as structural and functional centre of Russian Orbital Segment (ROS) [Russian part of ISS]
 SpaceX:
→ of entrepreneur Elon Musk.
 IN-SPACe:
→ independent nodal agency under Department of Space
→ for allowing space activities and usage of DOS owned facilities by Non -Government-Private-Entities
(NGPEs)
→ to prioritise launch manifest.
 Sub-orbital spaceflight:
→ spaceflight in which it reaches outer space, but its trajectory intersects atmosphere of gravitating body from which
it was launched (earth), so that it does not complete one orbital revolution (i.e. it does not become artificial satellite)
or it does not reach escape velocity.
 Sub-orbital:
→ Satellites need to reach threshold speed in order to orbit Earth.
→ If object travels at horizontal speed of 28,000 km/hr or more, then it goes into orbit once it is above atmosphere.
→ At such speed, satellite prevents itself from accelerating toward Earth due to Earth’s gravity.
→ Such trip allows space travellers to experience few minutes of weightlessness.
→ Significance:
 Sub-orbital flights are helpful for microgravity research.
 Sub-orbital flights are less expensive than carrying experiments, people to International Space Station.
 Sub-orbital flights could be alternative to parabolic flights in aeroplanes that space agencies currently use to
simulate zero gravity.
 Karman line (edge of space):
→ boundary between Earth's atmosphere and outer space
→ altitude of 100 kilometres above Earth’s sea level.
→ lies in Thermosphere.
 Armstrong Limit / Armstrong Line:
→ measure of altitude above which atmospheric pressure is sufficiently low that water boils at normal temperature of
human body.
→ Exposure to pressure below Armstrong limit results in loss of consciousness, followed by changes to cardiovascular
and neurological functions, and eventually death
→ On Earth, Armstrong limit is around 18–19 km above sea level.
 Gateway / Lunar Gateway:
→ One planned small space station in lunar orbit intended to serve as solar-powered communication hub, science
laboratory, short-term habitation module for government-agency astronauts, as well as holding area for rovers and
other robots.
→ It is multinational collaborative project involving NASA, ESA, JAXA, Canadian Space Agency (CSA).
→ It is planned to be both 1st space station beyond LEO and 1st space station to orbit Moon.
Value Addition:
 Greased Lightning-10 (GL-10):
→ It is electric plane tested by NASA.
→ hybrid diesel-electric tiltwing unmanned aircraft.
 90% of Earth’s gravity reaches space station. But, do objects still float in orbit because because they are in free fall.
 Distributed Spacecraft Autonomy (DSA) project:
→ allows spacecraft to decide their next activities, instead of being controlled by station on ground and
waiting further instructions.
→ Space agency like NASA is working on it.
Page 91 of 719
  SWARM:
→ distributed space systems (DSS) made of small satellites working in tandem to replace or augment earlier
satellites.
→ formations or “swarms” of small satellites.
→ smaller, less expensive, more efficient satellites
→ would remove, repair, or refuel thousands of unused satellites orbiting Earth.
→ one space exploration concept.
 Mir Space Station:
→ 1 st modular space station of world.
→ operated in low Earth orbit (LEO) from 1986 to 2001
→ operated by Soviet Union and later by Russia.
 Molniya orbit:
→ satellite orbit designed to provide communications and remote sensing coverage over high latitudes
→ highly elliptical orbit.
Mains Link:
 Discuss the significance of space tourism.
 Discuss the significance of Voyager Missions.
 Why is Gaganyaan mission significant for India? Discuss.
 Discuss the significance of Unity 22 mission.
 Write a note on the International Space Station.
 Discuss the consequences and concerns associated with china being a major space power.

WATER DISPUTE, DAM

News:
 2020:
→ Tamil Nadu protests against Karnataka’s move to build reservoir on Cauvery R. at Mekedatu. [TN says Karnataka’s
dam would block free flowing water coming into TN.]
 2021:
→ Dispute between Karnataka and Tamil Nadu about Cauvery river linking project.
→ Karnataka asserted that there is no compromise on Mekedatu project.
→ Karnataka demands that Cauvery Water Management Authority (CWMA) should give clearance for Detailed Project
Report (DPR) of Mekedatu Balancing Reservoir Project.
→ RS and Lok Sabha pass Dam Safety Bill, 2019. [now it becomes Dam Safety Act, 2021]
 2022:
→ Constitutional validity of Dam Safety Act, 2021 challenged in Madras High Court on grounds that it goes against
federalism and is beyond legislative competence of Centre.
→ Case in Supreme Court about Mullaperiyar dam.
→ Tamil Nadu rejects idea for exclusive discussion by Cauvery Water Management Authority (CWMA) on Mekedatu
Balancing Reservoir-cum-Drinking Water Project proposed by Karnataka. Tamil Nadu reiterated its position that
there should be no discussion on said subject, because it was sub judice (under judicial consideration and therefore
prohibited from public discussion elsewhere).
→ Karnataka Assembly adopts resolution seeking clearance for Mekedatu project. [This is in response to resolution of
Tamil Nadu opposing Mekedatu drinking water and balancing reservoir project].
 Karnataka’s demand:
• Karnataka Legislative Assembly urges Central Water Commission (Min. of Jal Shakti) and MoEF to approve
Mekedatu project at earliest.
• Karnataka Legislative Assembly urges Central authorities not to finalise Detailed Project Report (DPR) of
Godavari, Krishna, Pennar, Cauvery, Vaigai, Gundar river-linking project till share of riparian States is decided
and till Karnataka gives its approval.
• Karnataka Legislative Assembly also urges Centre not to approve illegal projects of Tamil Nadu and to
instruct Tamil Nadu to stop from continuing them.
 Karnataka’s reasons:
• Karnataka’s resolution said Supreme Court modified judgement of Cauvery Water Disputes Tribunal and
prescribed confirmation of release of water in normal water year.
• To ensure allocation for Bengaluru Metropolitan city and consumptive use as per Supreme Court’s verdict
and also for hydel generation, Mekedatu drinking water and balancing reservoir project has been planned.
→ Central Water Commission (CWC) says of all Asian countries, India has highest flood mortality rate, or number of
lives lost to flood each year.
→ Two Supreme Court judges recuse from hearing Krishna river water dispute case because they are from Maharashtra,
Karnataka.

Page 92 of 719
 → Karnataka CM says time has come to revisit Inter-State River Water Disputes Act, 1956 because it creates more
disputes than resolving them.
→ Karnataka government moves Supreme Court relating to dispute over allocation of Krishna river water,
flowing in MH, Karnataka, AP, Telangana.
→ Haryana Assembly passes resolution seeking completion of Sutlej Yamuna link canal / SYL Canal.
→ Supreme Court finds remedy / solution in Dam Safety Act, 2021 to end “perennial” legal battle between
Tamil Nadu and Kerala over Mullaperiyar dam.
→ Telangana Government requests Ministry of Jal Shakti (MoJS ) one more time to refer its complaint made
under Inter-State River Water Disputes Act, 1956, to existing Krishna Water Disputes Tribunal-II (Brijesh
Kumar Tribunal) to finalise fair and equitable share of Telangana in Krishna waters.
→ Supreme Court appointed committee, led by CWC Chief Engineer Gulshan Raj, inspected Mullaperiyar
reservoir. As per Supreme Court directive, this committee would monitor and maintain Mullaperiyar dam
until National Dam Safety Authority (NDSA) is established.
→ Cauvery Water Management Authority (CWMA) will take up Mekedatu Balancing Reservoir-cum-Drinking Water
Project of Karnataka government for discussion at its upcoming meeting. [Acceptance by CWMA would be
“prerequisite” for consideration of Detailed Project Report (DPR) by Advisory Committee of Ministry].
→ For 1st time in India for any dam, Rule curve has been implemented in Mullaperiyar Dam.
→ Kerala government constitutes a technical committee for preparing an Emergency Action Plan (EAP) for the
downstream part of the Mullaperiyar dam in Idukki district as per Dam Safety Act, 2021. [Earlier in June, 2022, Court-
appointed supervisory committee on the Mullaperiyar dam had directed Kerala and Tamil Nadu to update the EAP
for the dam].
Constitution:
 Article262 (Adjudication of disputes relating to waters of inter-State rivers or river valleys):
→ Parliament may by law provide for adjudication of dispute or complaint with respect to use, distribution or control
of waters of any inter-State river or river valley.
→ Notwithstanding anything in this Constitution, Parliament may by law provide that neither Supreme Court nor any
other court shall exercise jurisdiction in respect of any such dispute or complaint.
About:
 Constitutional:
→ Article 262 provides for adjudication of inter-State water disputes.
 In pursuance of Article 262, Parliament enacted:
→ River Boards Act,1956:
 Intro:
• It provides for establishment of river boards for regulation and development of Inter-state River and river
valleys.
• This Act is supposed to facilitate inter-state collaboration over water resource development
 River boards:
• Union government may, on request received from State government or otherwise, establish River Board for
advising concerned governments about regulation or development of inter-State river or river valley
• jurisdiction – concerned river, its tributaries, its river valley
• Composition:
 Chairman, such other members - as Union government thinks fit to appoint, among persons having
special knowledge and experience in:
o irrigation
o electrical engineering flood control
o navigation
o water conservation
o soil conservation administration or finance.
• Dissolution:
 After said river board has performed its functions, Union government can, after consultation with State
governments concerned, may dissolve said river board.
→ Inter-State River Water Disputes Act, 1956:
 Intro:
• It empowers central government to set up ad hoc tribunal for adjudication of dispute between 2 or more
States in relation to water of inter-state river.
• Decision of tribunal would be final and binding.
• It also bars Supreme Court and any other court to have jurisdiction in this matter.
 Water Disputes Tribunal:
• This Act says that when Union government receives requests / complaints from State governments about
water disputes, and Union government is of opinion that said water dispute cannot be settled by

Page 93 of 719
 negotiations, then Union Government shall constitute Water Disputes Tribunal for adjudication of water
dispute.
• Member:
 Chairman, 2 other members - nominated by CJI from amongst Supreme Court Judges or High Court
Judges.
• Union government may, in consultation with said Tribunal, appoint 2 or more persons as assessors to advise
said Tribual.
• Decision of said Tribunal shall have same force as order or decree of Supreme Court and binding on parties
to dispute.
 Bar of jurisdiction of Supreme Court and other courts:
• Notwithstanding anything contained in any other law, neither Supreme Court nor any other Court shall have
jurisdiction in respect of any water dispute referred to said Tribunal.
 Dissolution of Tribunal:
• After Triunal has forwarded its report, Union government shall dissolve if Union government is satisfied that
no further reference to said Tribunal in that matter would be necessary.
• That is, Water Disputes Tribunal - ad hoc tribunal.
 Dam in India:
→ Status:
 Over last 50 years, India invested substantially in dams, related infrastructures. India ranks 3rd after USA, China
in number of large dams.
→ Concern:
 Central Water Commission (CWC) said of all Asian countries, India has highest flood mortality rate, or number
of lives lost to flood each year.
 Floods lead to loss of lives and damages in properties.
 Flood tragedies are now being compounded by effects of climate change on dam operations.
 India has 5,745 dams, of which 293 are more than 100 years old; 25% of dams are between 50 and 100 years
old. These old dams are ill-equipped to respond to climate change. 2022 IPCC assessment report on Climate
Change notes that instances of floods in South Asia, including those caused by glacial lake outbursts, are going
to increase with rising temperature.
 No uniform law and administrative structure for ensuring dam safety.
 National Committee on Dam Safety (NCDS), Central Dam Safety Organization (CDSO), State Dam Safety
Organizations (SDSO) do not have statutory powers and are only advisory in nature.
 Majority of large dams in India are decades old.
 Badly maintained, unsafe dam can be hazard to human life, flora and fauna, public and private assets,
environment.
 India has had many dam failures in past.
→ Initiative:
 Dam Rehabilitation and Improvement Project (DRIP) [2012].
 Dam Health and Rehabilitation Monitoring (DHARMA).
 Seismic Hazard Analysis Information System (SHAISYS).
 Dam Safety Act, 2021.
→ Significance:
 Dams play key role in increasing rapid and sustained agricultural growth, development in India
 Issues:
→ Inter-State River Water Disputes Act, 1956 does not fix any time limit for resolving river water disputes.
→ Delays because of no time limit for adjudication by Tribunal.
→ Vacancy in Tribunal.
→ River Boards Act, 1956 remains ‘dead letter’ since its enactment.
→ Surface water is controlled by Central Water Commission (CWC). Ground water is controlled by Central Ground
Water Board of India (CGWB). Both bodies work independently and there is no common forum for common
discussion with State governments on water management.
 Way Forward:
→ Solution should be on basis of maximum utility of river basin capacity and using technology, and giving away all
political considerations.
Note:
 Dam related subject (Water List II State List) does not fall under purview of Parliament. But, Parliament can make laws to
regulate and develop in dam related subject (List I Central List).
 State List (List II):
→ Water - water supplies, irrigation and canals, drainage and embankments, water storage, water power (subject to
List I i.e. Union List).
 Union List (List I):
Page 94 of 719
 → Regulation and development of inter-State rivers and river valleys.
 Sutlej Yamuna Link Canal / SYL Canal:
→ What:
 under-construction 214-kilometer long canal in India to connect Sutlej R. and Yamuna R. in order to enable water
sharing of Ravi and Beas between Punjab, Delhi, Haryana.
 It is river water sharing between Punjab and Haryana
 This canal cuts across Haryana.
 This proposal was planned to enable Haryana to use its share of waters of Sutlej and its tributary Beas.
 Tripartite agreement was also negotiated between Punjab, Haryana, and Rajasthan. However, this proposal met
obstacles and was referred to Supreme Court.
 This canal, once completed, will enable sharing of waters of rivers Ravi and Beas between Punjab and Haryana.
→ Historical:
 Creation of Haryana from undivided Punjab in 1966 threw up problem of giving Haryana its share of river waters.
Punjab was opposed to sharing waters of Ravi and Beas with Haryana, citing riparian principles, and arguing that
it had no water to spare. However, Centre, in 1976, issued notification allocating to Haryana out of undivided
Punjab’s share. In reassessment of share of water flowing down Beas and Ravi was done in 1981 among Punjab,
Haryana, and Rajasthan.
 Eradi Tribunal was set up to reassess availability and sharing of water. Eradi Tribunal, in 1987, recommended
increase in shares of Punjab and Haryana.
→ Punjab’s demands:
 As per one Punjab government study, many areas in Punjab may go dry after 2029. Punjab has already over-
exploited its groundwater for irrigation purposes as it fills granaries of Centre by growing wheat and paddy worth
Rs. 70,000 crore every year. As per reports, water in about 79% of Punjab’s area is over-exploited. In such
situation, Punjab government says sharing water with any other State is impossible.
→ Haryana’s demand:
 Haryana seeks completion of SYL canal to get its share of river waters. It has maintained that Punjab should
comply with 2002 and 2004 Supreme Court orders in this regard.
→ Status:
 Haryana’s part of SYL canal is already completed (in 1980), but Punjab has opposed and delayed construction of
this canal.
 Krishna River water dispute:
→ History:
 Dispute began with erstwhile Hyderabad and Mysore states, and later continuing between successors
Maharashtra, Karnataka, Andhra Pradesh.
 In 1969, Krishna Water Disputes Tribunal (KWDT) was set up under Inter-State River Water Disputes Act, 1956.
 KWDT [1969] presented its report dividing Krishna water into 3 parts:
• X amount for Maharashtra. [least]
• Y amount for Karnataka.
• Z Andhra Pradesh. [most]
 New grievances arose between States, thus 2nd KWDT was instituted in 2004.
 KWDT – II [2004] delivered its report in 2010, allocating Krishna water again.
 This 2010 order of KWDT – II [2004] is not yet published because after creation of Telangana in 2014, Andhra
Pradesh asked to include Telangana as separate party at KWDT and that allocation of Krishna waters should be
reworked among 4 states, instead of 3.
 In 2011, Supreme Court stopped Centre from publishing said 2010 tribunal order in Official Gazette (under Inter-
State Water Disputes Act, 1956).
→ Status:
 Publication of 2010 tribunal order is necessary pre-condition for its implementation.
 Karnataka is currently seeking vacation of 2011 order of Supreme Court that stopped Centre from publishing
said 2010 tribunal order in Official Gazette (under Inter-State Water Disputes Act, 1956).
 Dam Rehabilitation and Improvement Project (DRIP) [2012]:
→ What:
 launched by Central Water Commission (CWC) with assistance from World Bank.
→ Objective:
 To improve safety and operational performance of selected existing dams.
 To strengthen dam safety institutional setup of participating States / Implementing Agencies.
 To explore alternative means at selected dams to generate incidental revenue for sustainable operation and
maintenance of dams.
→ Feature:
 Phase 1:
• It covered 223 dams in 7 States.
Page 95 of 719
 Phase II and Phase III:
• Financial Assistance is being provided by World Bank (WB), and Asian Infrastructure Investment Bank (AIIB).
• will be implemented till 2031.
→ Need:
 India ranks 3rd globally after China and United States, with 5334 large dams in operation. About 411 dams in
India are under construction at present. India also has thousands of smaller dams.
 Indian dams and reservoirs play important role in economic and agricultural growth of our country by storing
water annually.
 Dams present major responsibility in terms of asset management and safety.
 Consequences of dam failure can be catastrophic, in terms of loss of human life and property, and damage to
ecology.
 Dam Health and Rehabilitation Monitoring (DHARMA):
→ system to monitor health of dams.
→ At present, it is being used by 18 States.
 Dam Safety Act, 2021:
→ Need:
 Over last 50 years, India invested substantially in dams and related infrastructures, and ranks 3 rd after USA, China
in number of large dams. 5254 large dams are in operation in India currently and another 447 are under
construction. There are also thousands of medium and small dams.
 Need for uniform law and administrative structure for ensuring dam safety. [Though dam subject does not fall
under Parliament, it legislated on it mainly because dam safety is concern in India. And there is no legal and
institutional safeguards in this regard.]
 Central Water Commission (CWC) - through National Committee on Dam Safety (NCDS), Central Dam Safety
Organization (CDSO), State Dam Safety Organizations (SDSO) - has been working towards dam safety. But, these
organizations do not have statutory powers and are only advisory in nature.
 Majority of large dams in India are decades old.
 Badly maintained, unsafe dam can be hazard to human life, flora and fauna, public and private assets,
environment.
 India has had many dam failures in past.
→ Feature:
 provides for proper surveillance, inspection, operation, maintenance of all specified dams in India.
 provides for National Committee on Dam Safety (NCDS) to evolve dam safety policies and recommend necessary
regulations.
 provides for establishment of National Dam Safety Authority (NDSA) as regulatory body which shall implement
policy, guidelines, standards for dam safety.
 provides for constitution of State Committee on Dam Safety (SCDS) by State Governments.
→ Criticism:
 Act is too focused on structural safety and not on operational safety.
 Inadequate compensation to people affected by dams.
 No provision for independent regulator.
 No precise definition of stakeholders.
 Violates federalism:
• Many States say it encroaches upon their jurisdiction to manage their dams.
• They say it violates principles of federalism enshrined in Constitution.
• They see it as attempt by Centre to consolidate power in guise of safety concerns.
• Under Constitution, dams would fall within legislative domain of State governments. Power of Centre under
List I (Union list) is only with respect to inter-State rivers or river valleys.
→ Significance:
 will help all States and Union Territories to adopt uniform dam safety procedures.
 It will ensure safety of dams and safeguard benefits from such dams.
 It will also help in safeguarding human life, livestock, property.
 It addresses issues concerning dam safety - regular inspection of dams, Emergency Action Plan, comprehensive
dam safety review, adequate repair and maintenance funds for dam safety, Instrumentation and Safety
Manuals.
 It lays responsibility of dam safety on dam owners.
 Mullaperiyar Dam:
→ located in Kerala, operated by Tamil Nadu
→ constructed in 19 th century.
→ located on confluence of Mullayar R. and Periyar R., Kerala

Page 96 of 719
 → operated and maintained by Tamil Nadu after Periyar Lake Lease Agreement, 1886 signed between then
Travancore and then Secretary of State for India granting 999 years of lease to then Madras Presidency
[for Periyar Irrigation works].
→ it redirects river flow towards Bay of Bengal, instead of Arabian Sea [providing water to arid rain region of
Madurai in Madras Presidency]
→ provides water to Madras Presidency.
→ This dam is source of friction between Tamil Nadu and Kerala.
→ Issue:

{Kerala} {TN}
Kerala claims this 126-year-old dam is unsafe, badly
maintained and threat to thousands of people living
downstream. Tamil Nadu denies this charge.
Kerala wants new dam in place of this existing dam. Tamil Nadu argues that Mullaperiyar dam is well-
preserved and so strong that height water level could
even be increased to 152 feet.
Kerala demands that new dam must be constructed. Tamil Nadu says that new dam is not needed
Kerala is against increasing water levels at Tamil Nadu has strengthened Mullaperiyardam, but
Mullaperiyar dam, citing structural instability Kerala is blocking any attempt to raise reservoir water
level – resulting in losses for Madurai farmers.
Kerala fears devastation of residents living
downstream in earthquake-prone district of Idukki.
Scientists argued that if there is earthquake
measuring above 6 Richter scale, lives of around 3
million people will come under grave danger.
 In 2014, Supreme Court constituted permanent Supervisory Committee to oversee all issues concerning
Mullaperiyar dam.
 Supreme Court directed Supervisory Committee [2014] to decided on maximum water level that can be
maintained at Mullaperiyar dam.
 Due to risk of landslides, Kerala govt. proposed that existing dam be decommissioned and a fresh one be built
but it is not acceptable to Tamil Nadu.
→ Linkage between Dam Safety Act, 2021 and Mullaperiyar dam:
 As per 2021 Act, National Dam Safety Authority (NDSA) will perform role of State Dam Safety Organisations for
dam located in one State and used by another State. Hence, Mullaperiyar dam comes under this purview of
NDSA.
 Experts believe Union government may submit in Supreme Court that NDSA can absorb functions of supervisory
committee.
 Mekedatu Project / Mekedatu Reservoir:
→ What:
 multipurpose (drinking, power) project on Cauvery R. at Mekedatu in Karnataka.
 It involves building balancing reservoir, in Karnataka.
 It will ensure drinking water to Bengaluru, neighboring areas.
 It will also generate electricity power.
→ Background:
 Karnataka wants to build reservoir on river Cauvery at Mekedatu but Tamil Nadu is protesting it.
→ Why Tamil Nadu opposes?
 TN says Cauvery Water Dispute Tribunal (CWDT) [1990] and Supreme Court found that existing storage facilities
available in Cauvery basin were adequate for storing and distributing water. Thus, Karnataka’s proposal is
untenable and should be rejected outright.
 TN says Mekedatu reservoir is not just for drinking water alone, but to increase extent of irrigation, which is in
clear violation of Cauvery Water Disputes Award.
 TN says that this reservoir would affect natural flows of river Cauvery. TN also says that Cauvery was already
deficit basin and construction of this project would drastically affect lower riparian State (TN) in getting its due
share of waters.
→ Award by CWDT and Supreme Court:
 CWDT gave its final award in 2007, granting shares of water to Tamil Nadu (largest share), Karnataka, Kerala,
Puducherry. CWDT award also ordered that in rain-scarcity years, allocation for all would be reduced.
 But, both TN, Karnataka were unhappy over CWDT allocation. It led to Supreme Court taking up matter and gave
its judgment in 2018 (took some water share from TN and gave to Karnataka).
→ Issue:

Page 97 of 719
  Detail Project Report (DPR) of Karnataka was tabled in Cauvery Water Management Authority (CWMA) several
times for approval. But no approval due to lack of consensus among party States – Karnataka, Tamil Nadu.
 Since Mekedatu project is proposed across inter-State river, it requires approval of lower riparian State(s) under
Inter-State River Water Disputes Act, 1956.
→ Presently:
 Cauvery Management Scheme.
 Centre said Mekedatu project required approval of Cauvery Water Management Authority (CWMA).
 CSDT final award, which was modified by Supreme Court, said approval by CWMA would be prerequisite for
consideration of Karnataka’s DPR by Jal Shakti Ministry.
 Detail Project Report (DPR) of Karnataka was tabled in Cauvery Water Management Authority (CWMA) several
times for approval. But no approval due to lack of consensus among party States – Karnataka, Tamil Nadu.
 Centre’s role:
• Central government will provide help in implementation of modified award in case of any of State / UT
parties (TN, Kerala, Karnataka, Puducherry) do not cooperate in implementing decision or direction of
tribunal. Initially, Centre will contribute Rs. 2 crore for functioning of CWMA authority.
 Cauvery Management Scheme [2018]:
→ What:
 Scheme of Centre for smooth distribution of Cauvery water among 4 southern riparian states / UT:
• Tamil Nadu
• Karnataka
• Kerala
• Puducherry.
 This scheme was framed by Centre and approved by Supreme Court in 2021.
 Under it, Cauvery Water Management Authority (CWMA) has been created.
→ Cauvery Water Management Authority (CWMA):
 What:
• Authority created under Cauvery Management Scheme 2018 framed by Centre and approved by Supreme
Court.
 Composition and Powers:
• This authority will comprise 1 chairman, 1 secretary, 8 members.
• Out of 8 members, 2 will be full time, while 2 will be part time members from Centre’s side. Rest 4 will be
part time members from States.
 Functions:
• Main mandate will be to secure implementation and compliance of Supreme Court’s order in relation to
“storage, apportionment, regulation and control of Cauvery waters”.
• It will also advise States to take suitable measures to improve water use efficiency.
• It will do so by promoting use of micro-irrigation, change in cropping patterns, improved farm practices and
development of command areas.
• It will also prepare annual report covering its activities during preceding year.
Value Addition:
 Regulation and development of inter-State rivers and river valleys – Union list in 7th schedule.
 Convention on Protection and Use of Transboundary Watercourses and International Lakes, 1992 (Water Convention):
→ unique legally binding instrument
→ promotes sustainable management of shared water resources, implementation of SDGs, prevention of conflicts,
promotion of peace and regional integration.
→ Its protocols:
 Protocol on Water and Health, 1999
 ….
→ Implementation:
 Water Convention requires Parties to prevent, control, reduce transboundary impact, use transboundary waters
in reasonable and equitable way and ensure their sustainable management.
 Parties bordering same transboundary waters have to cooperate by entering into specific agreements and
establishing joint bodies.
 As framework agreement, Convention does not replace bilateral and multilateral agreements for specific basins
or aquifers; instead, it fosters their establishment and implementation, further development.
→ India – not signatory.
 Rule Curve (Dam):
→ It decides fluctuating storage levels in reservoir. Gate opening schedule of dam is based on rule curve. It is part of
core safety mechanism in dam. It allows how much water can be stored in reservoir based on rainfall data.
Mains Link:
 Write a note on the Mekedatu project.
Page 98 of 719
  Examine why Mullaperiyar dam issue has become bone of contention between Tamil Nadu and Kerala. Examine if the
union government can help resolve this issue.
 Discuss the significance of the Dam Rehabilitation and Improvement Project.
 Write a note on Inter-State Water Disputes Act (1956).
 It is said that water sharing awards and agreements such as the Sutlej–Yamuna Link between Punjab and Haryana are
generally politically-induced, and therefore, remain unimplemented. Do you think sharing of river water should be based
on the emerging ground realities, especially geographical factors?

YAMUNA RIVER
(GS1, GS3)
News:
 2021:
→ Layer of froth seen floating in Yamuna River in Delhi. And, devotees were standing in this toxic foam -laden
water to offer prayers.
 2022:
→ According to Central Pollution Control Board (CPCB), Delhi generates about 3,800 million litres of sewage
per day. National Mission for Clean Ganga (NMCG) is looking into ways to prevent this.
→ Water supply gets disrupted in Delhi once again when ammonia levels in Yamuna River remained high.
Concentration of ammonia in Yamuna River is about 7 times (about 7.4 ppm) level th at Delhi Jal Board’s
water treatment plants (WTPs) can process (1 ppm).
→ River activists demand prompt measures to save Yamuna river.
 Demands by River activists:
• Construct Rubber check dam downstream of Taj Mahal.
• Revisit 1994 Yamuna water distribution agreement to ensure larger share of Yamuna water for Agra and
Mathura.
• Frame comprehensive national rivers policy.
• Constitute central rivers authority for management of all big rivers in India.
About:
 What:
→ major tributary of Ganga R.
→ 1,300-km-long
→ originates from Yamunotri glacier near Bandarpoonch peaks in Mussoorie range of lower Himalayas,
Uttarakhand.
→ Uttarakhand, HP, Haryana, Delhi, UP.
→ meets Ganga at Sangam in Prayagraj, UP
 Tributaries:
→ Chambal, Sindh, Betwa, Ken.
 Yamuna River Pollution / Pollution in Yamuna River:
→ Present status:
 faecal, pollutants, hardness of water, chlorine, calcium, sulfate.
 Yamuna is among most polluted rivers in India.
 It provides water to more than half of Delhi. And, just 2% or 22 km of Yamuna falls in Delhi, but 98%
of pollution in Yamuna comes from Delhi due to untreated, semi -treated industrial effluents, sewage
that is being discharged into Yamuna river.
→ Cause of pollution:
 Sewage Treatment Plants (STPs):
• Sewage treatment plants of Delhi are major contributors of Pollutants being discharged in Yamuna river.
 Industry discharges:
• Pollutants discharge from different types of industry
 Agriculture activities:
• Agriculture activities along banks of Yamuna river in Delhi.
• Agricultural waste, pesticide discharge from Haryana field.
 Low volume of water flow in Yamuna river:
• Low volume of water flow in Yamuna river causes pollutants to accumulate and raise river pollution
level.
 Ammonia pollution in Yamuna:
• Most likely source of Ammonia in Yamuna R. is believed to be effluents from dye units, distilleries,
other factories in Haryana, and also sewage from some unsewered colonies in this stretch of
Yamuna river.
• As per BIS, acceptable maximum limit of ammonia in drinking water is 0.5 ppm.
 Foaming / frothing in winter:

Page 99 of 719
 • Yamuna river water flow is less. So, pollutants are not diluted.
→ Impact:
 Degradation of water quality
→ Challenges:
 Delhi depends on Haryana for up to 70% of its water needs. Haryana, with large number of people involved
in agriculture, has water paucity issues of its own. Both States have argued over maintaining water flow
in Yamuna at all times. Both States have approached courts several times over past decade about
equitable share of water.
 Lack of minimum ecological flow leads to accumulation of pollutants like Ammonia. After water is
extracted from Yamuna river for treatment in Delhi, what flows is mostly untreated sewage from homes,
runoff from storm water drains, effluents from unregulated industry.
→ Way Forward:
 Stringent implementation of guidelines against dumping harmful waste into Yamuna river.
 Making sure untreated sewage does not enter Yamuna water.
 Maintain sustainable minimum flow, called ecological flow. This is minimum amount of water that should
flow throughout river at all times to sustain underwater and estuarine ecosystems and human livelihoods,
and for self regulation.
Note:
 Right to clean environment (Article 48A, Article 51A), and further, pollution-free water, is protected under broad
rubric of Right to Life (Article 21)
 Froth:
→ What:
 mass of small bubbles in liquid (water)
→ Feature:
 toxic foam-laden water
 sign of polluted river
→ Causes:
 release of untreated or poorly treated effluents, including sewage from city
 Surfactants and phosphates from detergents in households, industrial laundry.
 Ecological flow:
→ This is minimum amount of water that should flow throughout river at all times to sustain underwater and
estuarine ecosystems and human livelihoods, and for self regulation.
Mains Link:
 Discuss about the efforts by the Government to prevent river pollution in India.

UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT (UNCTAD) [1964]

News:
 2021:
→ UNCTAD releases 2022 World Investment Report.
About:
 What:
→ UNCTAD was established by UNGA in 1964 as intergovernmental organization intended to promote
interests of developing states in world trade.
→ Its permanent secretariat is in Geneva.
 Goal:
→ Maximize trade, investment and development opportunities of developing countries and assist them in
their efforts to integrate into world economy on equitable basis.
→ To formulate policies relating to all aspects of development including trad e, aid, transport, finance and
technology.
 Feature:
→ UNCTAD is part of UN Secretariat dealing with trade, investment, and development issues.
→ It reports to UNGA and UNESC.
→ Its conferences ordinarily meet once in 4 years
→ It has its own membership, leadership, and budget.
→ It is part of UN Development Group.
 Role:
→ It supports developing countries to access benefits of globalized economy more fairly and effectively.
→ It measures progress made in SDGs, as set out in Agenda 2030.
 Achievement:
→ UNCTAD has been able to conceive and implement Generalized System of Preferences (GSP). It was argued
in UNCTAD that to promote exports of manufactured goods from developing countries, it would be

Page 100 of 719

 necessary to offer special tariff concessions to such exports. Accepting this argument, developed countries
formulated GSP scheme under which manufacturers' exports and import of some agricultural goods from
developing countries enter duty-free or at reduced rates in developed countries. Since imports of such
items from other developed countries are subject to normal rates of duties, imports of same items from
developing countries would enjoy competitive advantage.
 Reports published:
→ Trade and Development Report
→ World Investment Report
→ Technology and Innovation Report
→ Digital Economy Report
Note:
 World Investment Report:
→ What:
 This report is released annually by UNCTAD.
 It focuses on trends in FDI worldwide, at regional and country levels and emerging measures to improve its
contribution to development.
 It also provides analysis on global value chains and operations of multinational enterprises, with special attention
to their development implications.
→ Feature:
 Its overviews are available in all official UN languages.
 Every issue of this Report has:
• Analysis of trends in FDI during previous year, with especial emphasis on development implications.
• Ranking of largest transnational corporations in world.
• In-depth analysis of selected topic related to FDI.
• Policy analysis and recommendations.
• Statistical annex with data on FDI flows and stocks at country level.
→ 2022 World Investment Report:
 Highlights:
• India is ranked 7th despite 30% decline in FDI into it.
• United States remains top recipient of FDI.
• China and Hong Kong also retained 2nd and 3rd position respectively.
• Among top 10 host economies, only India saw decline in its inflows. However, outward FDI from India rose
43% in 2021.
• Top 10 FDI recipients: USA, China, Hong Kong, Singapore, Canada, Brazil, India, …

INTERLINKING OF RIVERS / INTER-LINKING OF RIVERS / RIVER LINKING / RIVERS LINKING

News:
 2016:
→ National Board for Wildlife (apex wildlife regulator) clears Ken-Betwa Link Project (KBLP).
 2021:
→ Union Jal Shakti Ministry, Madhya Pradesh (MP) and Uttar Pradesh (UP) signs historic tripartite agreement to
implement KBLP.
→ New study says Ken-Betwa River interlinking project will lead to submergence of major portion of core area of Panna
Tiger Reserve in Madhya Pradesh, triggering major loss of tiger and its major prey species – chital, sambar.
 2022:
→ In her budget speech, Union Finance Minister Nirmala Sitharaman proposes project to link 5 rivers in India. Rivers
are:
 Godavari-Krishna
 Krishna-Pennar
 Pennar-Cauvery
 Damanganga-Pinjal
 Par-Tapi-Narmada.
→ Cabinet set deadline for Ken-Betwa link before it got clearances in place. [Even as Cabinet cleared Ken-Betwa link
project (KBLP) in December 2021 with 8-year deadline for completion, KBLP does not have clearances to start work
as yet.]
→ Union Cabinet approves funding and implementation of Ken-Betwa inter-linking of rivers project.
→ Tribals in Gujarat are protesting against Centre’s Par Tapi Narmada river-linking project.
→ PM Modi to inaugurate Astol project that will provide tap water to 4.50 lakh people living in 174 tribal villages and
1,028 hamlets on hills in Gujarat. This is significant as tribes in this area are protesting against central government’s
Par-Tapi-Narmada River link project.
 Background:
Page 101 of 719
 • Par-Tapi-Narmada River link project in Gujarat was scrapped after strong protests by tribal communities of
in region.
Constitution:
 Under 7th schedule, inter-state rivers / rivers valleys are in Union List.
About:
 What:
→ Interlinking of rivers (ILR) programme is major step to create additional storage facilities and transfer water from
water-surplus regions to more drought-prone areas.
→ There are about 30 envisioned river linkings in India.
 Benefits:
→ Enhances water security, food security.
→ Proper utilisation of water.
→ Boost to agriculture.
→ Disaster mitigation.
→ Boost to transportation.
 National Perspective Plan (NPP) [1980]:
→ National Perspective Plan for interlinking of rivers.
→ prepared by then Ministry of Irrigation (now Ministry of Jal Shakti)
→ for water resources development through inter basin transfer of water to transfer water from water surplus basins
to water-deficit basins.
→ Under NPP, National Water Development Agency (NWDA) has identified 30 links (16 under Peninsular Component
and 14 under Himalayan Component).
 Example:
→ Ken-Betwa Link Project (KBLP):
 What:
• Construction of tunnels, canals, power houses, dams, barrages.
• transferring of water from Ken river to Betwa river through construction of Daudhan dam and canal linkage
• India’s 1st river interlinking project.
 Aim:
• transfer of surplus water from Ken R. to Betwa R. to irrigate drought-prone Bundelkhand region of both MP
and UP.
 Concern:
• Deforestation of part of Panna Tiger reserve, MP. (affect habitat of vultures, jackals).
• Submergence of major portion of core area of Panna Tiger Reserve. This will trigger major loss of tiger and
its major prey species like chital, sambar.
• loss of large area of critical tiger habitat (CTH) in Panna reserve.
• habitat fragmentation
• loss of connectivity
• area that will be submerged has rich floral density, floral diversity. Sambar, chital, blue bull, wild boar are
found here.
 Benefit:
• water security, drinking to water-starved Bundelkhand region (MP, UP)
• food security
• generate hydropower
• Proper utilisation of water
• Boost to agriculture (irrigation)
• Disaster mitigation
• Boost to transportation
• boost socio-economic prosperity (increased agricultural activities, employment generation)
• decrease distress migration from Bundelkhand region
• model project / plan for similar interstate river linkings.
 Funding:
• Union Cabinet approves funding and implementation of Ken-Betwa river interlinking project at cost of about
INR 44,000 crore.
• Centre would fund about INR 39,000 crore, with about INR 36,000 crore as grant and about INR 3,000 crore
as loan.
 Challenges:
• 2016-17: KBLP got wildlife, environment and preliminary forest clearances on condition that no units of
proposed powerhouse would be constructed in forest area to avoid constant disturbance in Panna tiger
reserve. But KBLP is yet to submit modified project plan of relocated power stations for fresh environment
clearance.
Page 102 of 719
 • 2018-19: Hearing petition against KBLP’s wildlife clearance, Supreme Court asked its one committee to
investigate. Said committee recommended examination of alternatives to meet irrigation and poverty
alleviation targets set by specialised agencies, and thorough study of KBLP’s impact on Panna, before
approving KBLP project. Now, Supreme Court is yet to decide on this matter. That is, Supreme Court yet to
decide on wildlife clearance.
• 2018-21: Ministry of Jal Shakti repeatedly told Environment Ministry about issue of land in Madhya Pradesh.
That is, final forest clearance pending as MP yet to meet key pre-conditions like adding 60 sq. km of revenue
land to Panna Tiger Reserve.
→ Damanganga-Pinjal river linking:
 to divert surplus water from Damanganga basin to provide domestic water for Mumbai city.
→ Par-Tapi-Narmada project:
 What:
• to provide water to doubt-prone regions of Kutch, Saurashtra (Gujarat) by diverting excess water from 7
reservoirs in Western Ghats in North Maharashtra, south Gujarat.
• It proposes to link 3 rivers:
 Par River, originating from Nashik in Maharashtra.
 Tapi River, from Saputara in Gujarat that flows through Maharashtra and Surat in Gujarat.
 Narmada River, originating in Madhya Pradesh and flowing through Maharashtra, Bharuch district and
Narmada district in Gujarat.
• This project proposes to transfer river water from surplus regions of Western Ghats to deficit regions of
Saurashtra and Kutch in Gujarat.
• envisioned under 1980 National Perspective Plan (NPP).
 Benefits:
• Surplus water proposed to be diverted through Par-Tapi-Narmada link project is expected to irrigate
thousands of hectares.
 Why opposed?
• According to one report by National Water Development Agency (NWDA), about 6065 ha of land area will
be submerged due to this proposed reservoirs.
• Total of 61 villages will be affected, of which one village will be fully submerged and remaining 60 partly
submerged.
• Total number of affected families would be 2,509 of which 98 families would be affected due to creation of
Jheri reservoir- only one in Maharashtra, spread over 6 villages.
• In Gujarat, around 2000 families will be affected by this project. Districts where this project will be
implemented are largely dominated, by tribals who fear displacement. Thus, tribals in Gujarat are protesting
against Centre’s Par Tapi Narmada river-linking project.
 Issues:
→ Idea that river linking would allow us to cope with flood in NE and shortage of water in Deccan is positive aspect but
misleading one too. This floods come at time when most parts of india run short of water, we need to hold water
somewhere to use it in dry season but amount of flowing in short period of time in Brahmaputra and Ganga is so
huge to store and use it later.
→ Interlinking of rivers is very expensive proposal. Amount required is so huge that government will have to take loans
from foreign sources which would increase burden on government and India will fall in debt trap.
→ River interlinking project will adversely affect land, forests, biodiversity, rivers and livelihood of millions of people.
→ Ken-Betwa link threatens Panna tiger reserve.
→ Interlinking of rivers will lead to destruction of forests, wetlands and local water bodies, which are major
groundwater recharge mechanisms.
→ Not so beneficial in similar projects in other countries like diversion of Amu Darya R. (Central Asia), Syr Darya R.
(Central Asia), Murray Darling basin (Australia).
→ It causes massive displacement of people. Huge burden on government to deal with issue of rehabilitation of
displaced people.
→ Due to interlinking of rivers, there will be decrease in amount of fresh water entering seas and this will cause serious
threat to marine life.
→ 2016 Shah committee pointed out that linking of rivers will affect natural supply of nutrients for agricultural lands
through curtailing flooding of downstream areas.
→ adversely affect land, forests, biodiversity, rivers, livelihood of millions of people.
→ destruction of forests, wetlands, local water bodies, which are major groundwater recharge mechanisms.
→ massive displacement of people.
→ Huge burden on government to deal with issue of rehabilitation of displaced people.
→ decrease in amount of fresh water entering seas and this will cause serious threat to marine life.
 Challenges for India:
→ India has 18% of world’s population but only 4% of usable water resources.

Page 103 of 719

 → Variability in rainfall is high which is main source in India, flood and drought simultaneously within many States.
→ Irrigation potential from interlinking rivers will have limited impact. Net national irrigated area from big dams has
decreased and India’s irrigated area has gone up primarily due to groundwater.
→ We don’t have river basin plan yet in place.
→ Large hydropower projects are no longer viable option in India.
→ Storing large quantities of waters. Most of sites suitable for big reservoirs are in Nepal, Bhutan and in NE India who
are in opposition to big storage reservoirs.
→ Water has now become political issue.
→ Water transfer and water sharing are sensitive political subjects.
→ If glaciers don’t sustain their glacier mass due to climate change, interlinking project will have limited benefit.
→ Usually rivers change their course and direction in about 100 years and if this happens after interlinking, then project
will not be feasible for longer run.
 Significance:
→ India receives most of its rain during monsoon season from June to September, most of it falls in northern and eastern
part of India, amount of rainfall in southern and western part are comparatively low. It will be these places which
will have shortage of water. Interlinking of rivers will help these areas to have water throughout year.
→ This will cut farmers dependence on monsoon rains by bringing cultivatable land under irrigation.
→ Crop productivity would increase and so would revenues for State.
→ Even one bad monsoon has direct and hurt economic impact.
→ River linking project will ease water shortages in western and southern India while mitigating impacts of recurrent
floods in eastern India.
→ Ganga Basin, Brahmaputra basin see floods almost every year. In order to avoid this, water from these areas has to
be diverted to other areas where there is scarcity of water. This can be achieved by linking rivers. There is 2 two way
advantage with this – floods will be controlled and scarcity of water will be reduced.
→ Simultaneous floods and droughts continue to wreak havoc, destroying lives and livelihoods of millions.
→ India needs clean energy to fuel its development processes, and river water can be leveraged for this.
→ Fulfilling water needs impact socio-economic life of people which will help end poverty.
→ Need for interlinking of rivers to prevent inter-state water disputes.
→ Potential benefits to transportation through navigation, as well as broadening income sources in rural areas through
fishing.
 Way Forward:
→ Look at water as strategic resource for development.
→ Environment is one issue where all of us should be concerned about.
→ Best practices done by China and neighboring countries needs to be looked upon.
→ biggest, cheapest, possibly fastest and most decentralized storage option for India is groundwater.
→ Invest in water conservation, more efficient irrigation and better farm practices.
→ Recycling of water for internal usage like in Israel.
→ We need mandatory enforceable river policy aimed at treating rivers as national treasure.
→ Desiltation of accumulaled silt in huge quantities, particularly Ganga and its tributaries.
→ River linking in south and other parts which was undertaken in past has been going well and so such model needs to
be taken forward.
→ Planting trees on river banks is one way of bringing life back to rivers.
→ Forest catchments will need to be restored, wastewater from industries and towns need to be treated, sand mining
need to be stopped.
→ Need to build responsibility, capability and accountability in our water management institutions to revive our rivers.
→ Judicious use of canal water, growing crops that are appropriate to region, encouraging drip irrigation and reviving
traditional systems like tanks.
 Conclusion:
→ River linking project is great challenge and opportunity to address water issues arising out of climate change. Long-
term solution to water scarcity lies in making IRL project work by building network of dams and canals across length
and breadth of India. However, interlinking has to take place after detailed study so that it does not cause any
problem to environment or aquatic life.
Note:
 Ken River:
→ Originates from MP.
→ joins Yamuna R. in Uttar Pradesh UP
→ i.e. tributary of Yamuna R.
→ lies in Bundelkhand region
→ lies in east of Betwa R.
→ passes through Panna National Park (tiger reserve).
 Betwa River:
Page 104 of 719
 → Originates from Vidhyan Range, MP.
→ runs over Malwa Plateau.
→ joins Yamuna R. in UP
→ i.e. tributary of Yamuna R.
→ lies in Bundelkhand region
→ lies west of Ken R.
 Krishna:
→ 4thlargest river in India
→ originates in Mahabaleshwar (Maharashtra)
→ flows through Maharashtra, Karnataka, Telangana, Andhra Pradesh.
 Cauvery:
→ originates in Karnataka
→ flows through Karnataka, Tamil Nadu.
 Penna:
→ originates in Karnataka
→ flows through Karnataka, Tamil Nadu, Andhra Pradesh.
 Daman Ganga R.:
→ Damanganga R. flows through MH, Gujarat.
 Godavari:
→ 3rdlargest river in India
→ originates in MH
→ flows through Maharashtra, Telangana, Andhra Pradesh, Chhattisgarh, Orissa.
 Narmada River:
→ Narmada R. flows to west, while most other large peninsular rivers flow to east, because it occupies linear rift valley.
Narmada is flowing through area where land is not sloping towards west from central India, but it is flowing west
because of rift valleys only.
Mains Link:
 Discuss the significance of Ken-Betwa project.
 Discuss the significance of Par-Tapi-Narmada river-linking project.

FAST RADIO BURST (FRB)

News:
 2020:
→ FRB emitted by Magnetar, located in center of our Milky Way Galaxy, have been detected.
 2021:
→ Canadian Hydrogen Intensity Mapping Experiment (CHIME) Collaboration / telescope have assembled
largest collection of fast radio bursts (FRBs).
 2022:
→ Astronomers report one FRB whose characteristics are different from almost all other FRBs previously
detected, except one. This latest FRB (named FRB 20190520B), unlike many other FRBs, emits frequent,
repeating bursts of radio waves. Only 1 FRB is previously observed to behave this way.
About:
 What:
→ Intense pulses of radio waves.
→ oddly bright flashes of light, mysterious beacons, registering in radio band of electromagnetic spectrum,
which blaze for few milliseconds before vanishing without trace.
→ FRBs are bright flashes of light that appear for few milliseconds and then vanish.
 Source:
→ Astronomers suggested that candidates for sources of FRBs are superdense neutron stars left over after
supernova, or magnetars (neutron stars with ultra-strong magnetic fields).
 Feature:
→ They are spotted in universe, including our own galaxy.
→ Their appearance is highly unpredictable.
Note:
 CHIME Project:
→ What:
 Canadian Hydrogen Intensity Mapping Experiment (CHIME) Collaboration / telescope
 large stationary radio telescope
 in Canada.
→ Significance:
 Catching sight of FRB which is rare thing.

Page 105 of 719

  Magnetar:
→ Rare type of neutron star i.e. neutron star with ultra-strong magnetic field.
→ They are most powerful magnets in cosmos. They are 5,000 trillion times more powerful than magnetic
fields of Earth.
Mains Link:
 Write a note on FRBs.
 What are FRBs? How are they significant in understanding our universe? Discuss.

PUBLIC FINANCIAL MANAGEMENT SYSTEM (PFMS)

News:
 2022:
→ Ministry of Finance launches Single Nodal Agency (SNA) Dashboard of PFMS.
About:
 What:
→ It was previously known as Central Plan Schemes Monitoring System (CPSMS).
→ It is web-based online software application developed and implemented by Office of Controller General of Accounts
(CGA), Ministry of Finance.
→ PFMS is one financial management platform for Govt of India schemes. It is one database of all recipient agencies,
integration with core banking solution of banks handling plan funds, integration with State Treasuries and efficient
and effective tracking of fund flow to lowest level of implementation for plan scheme of Government.
 Objective:
→ To facilitate sound Public Financial Management System for Government of India by establishing efficient fund flow
system as well as payment cum accounting network.
 Coverage:
→ At present, ambit of PFMS coverage includes Central Sector Schemes, Centrally Sponsored Schemes as well as other
expenditures including FC Grants.
 Feature:
→ It facilitates transfer of funds directly to account of beneficiaries
→ It provides effective decision support, tracking of funds, etc.
→ Real time information on resource availability and utilization across schemes
→ Integration with application of Government Departments / Ministries for online collection of their receipts.
→ To provide information across all Govt. of India schemes / implementation agencies in India on fund utilization
leading to better monitoring, review and decision support system to enhance public accountability in implementation
of plan schemes.
 Significance:
→ It will help in achieving effectiveness and economy in Public Finance Management through better cash management
for Government transparency in public expenditure and real-time information on resource availability and utilization
across schemes.
→ It will also result in improved programme administration and management, reduction of float in system, direct
payment to beneficiaries and greater transparency and accountability in use of public funds.
→ PFMS system is envisaged to become important tool for improving governance.
 Single Nodal Agency (SNA) Dashboard [2021]:
→ What:
 System which tracks transfer of funds to States for centrally sponsored schemes (CSS) and utilisation
of funds by central agencies.
→ Feature:
 Under this system, each State is required to identify and designate one SNA for every scheme.
 All funds for that State in particular scheme are now credited in this bank account and all expenses by
all other Implementing Agencies involved are affected from this account.
→ Significance:
 It will make governance more transparent and realise better value for every rupee sent by Centre by
‘just-in-time’ money release.
 Ensures timely allocation of funds.
 Brought in greater efficiency in CSS fund utilization.
 Tracking of funds has become easier.
Mains Link:
 Discuss the significance of PFMS.

WORLD TRADE ORGANIZATION (WTO) [1995]

News:
 2021:

Page 106 of 719

 → Ngozi Okonjo-Iweala appointed as new chief of WTO. [1 st woman, 1st African citizen].
 2022:
→ Under WTO norms, China’s status as ‘developing country’ at WTO is becoming contentious issue with many
countries raising concerns over upper middle-income nation deriving benefits reserved for developing
countries.
→ Concerns raised over ‘Least Developed Country’ (LDC) status, with Bangladesh potentially losing LDC tag
after surpassing India in terms of GDP per capita.
→ EU launches case against China at WTO for targeting Lithuania over its stance on Taiwan. [Lithuania had
allowed Taiwan to open diplomatic outpost in its capital – Vilnius].
→ India expresses concern that some suggestions on reforming WTO could eventually damage developing
nations more.
→ WTO’s 164 members (12th Ministerial Conference) in historic step approves series of trade agreements including
commitments on fish, partial waiver of IP rights for COVID-19 vaccines, and pledges on health and food security.
→ WTO warns darkened trade outlook could deteriorate further: WTO cuts 2023 global trade growth forecast to 1.0%
from 3.4%. WTO also says trade could contract if Ukraine war worsens. WTO forecast slowdown of global trade
growth in 2023 because higher energy price, higher food price and rising interest rates curb import demand, and
warned of possible contraction if war in Ukraine worsens. WTO also says merchandise trade would increase by 3.5%
in 2022, however, for 2023, WTO sees trade growth of just 1.0%.
About:
 What:
→ established under Marrakesh Agreement, 1994.
→ It replaced General Agreement on Trade and Tariffs (GATT), 1946.
→ GATT did not stop to exist. GATT continues as WTO’s umbrella treaty for trade in goods.
 Structure:
→ WTO is headed by Ministerial Conference
→ Daily operations are carried out by 3 administrative bodies:
 General Council
 Dispute Settlement Body
 Trade Policy Review Body
 Function:
→ Dispute settlement:
 Background:
• Resolving trade disputes is one of core activities of WTO.
• Dispute arises when member government believes another member government is violating agreement or
commitment that it has made in WTO.
• WTO has one of most active international dispute settlement mechanisms in world.
• Since 1995, > 500 disputes have been brought to WTO and > 350 rulings have been issued.
 2 main ways to settle dispute at WTO:
• parties find mutually agreed solution, particularly during bilateral consultations.
• through adjudication, including subsequent implementation of panel report and Appellate Body report,
which are binding upon parties once adopted by Dispute Settlement Body.
 3 main stages to WTO dispute settlement process:
• Bilateral consultations between parties.
• Adjudication by panels and, if applicable, by Appellate Body.
• Implementation of WTO ruling, which includes possibility of countermeasures in event of failure by losing
party to implement WTO ruling.
 Classification of countries in WTO:
→ There are no WTO definitions of “developed” and “developing” countries.
→ Members announce for themselves whether they are “developed” or “developing” countries. WTO allows
member countries to classify themselves as “developed” or “developing”. But, other members can
challenged that decision.
→ UN only designates Least Developed Country’ (LDC) status.
→
{LDC} {Developing} {Developed}
Afghanistan Russia US
Nepal China EU
Bhutan India Japan
Bangladesh Brazil Canada
Myanmar South Africa Australia
…. South Korea NZ
…. ..
Page 107 of 719
 → WTO norms for recognition of Developed, Developing, LDC:
 Under WTO system, generally, countries are designated as developed, developing, LDC.
 General Agreement on Tariffs and Trade (GATT) recognises that attaining objectives of GATT agreement would
require facilitating development of those countries that can only support low levels of development and are at
early stages of development.
 Thus, countries self-designate themselves as ‘developing country’ to take advantage of certain GATT provisions,
other special and differential treatment (S&DT) provisions in WTO agreements.
 Said provisions are aimed at increasing trade opportunities for developing countries, ensuring longer transitional
periods to comply with WTO obligations, affording technical assistance to countries, etc.
→ Advantages of “developing country” status:
 brings certain rights.
 ensures special and differential treatment (S&DT) or provisions which allow them more time to implement
agreements and commitments
 includes measures to increase trading opportunities
 safeguards their trade interests
 supports to build capacity to handle disputes
 supports to implement technical standards.
 Special and differential treatment (S&DT) provisions:
→ Longer time periods for implementing Agreements and commitments.
→ Measures to increase trading opportunities for developing countries.
→ All WTO members to safeguard trade interests of developing countries.
→ Support to help developing countries build capacity to carry out WTO work, handle disputes, implement
technical standards.
→ Concept of non-reciprocal preferential treatment for developing countries that when developed countries
grant trade concessions to developing countries, they should not expect developing countries to make
matching offers in return.
→ Nearly 2/3rdof WTO members avail special treatment by designating themselves as developing countries
→ Developed countries, mainly US, demand / ask WTO to end benefits given to developing countries.
 WTO subsidy:
→ In WTO terminology, subsidies in general are identified by “boxes ” which are given colours of traffic lights:
 green (permitted)
 amber (slow down — i.e. need to be reduced)
 red (forbidden).
 Issue:
→ uneven level of development between developed and developing countries in WTO.
→ Developed countries, mainly US, ask WTO to end benefits given to developing countries
 India:
→ member of GATT since 1948
→ party to Uruguay Round
→ founding member of WTO.
→ Developing country in WTO norm.
 WTO Ministerial Conference:
→ What:
 Ministerial Conference is top decision making body of WTO. Till 2022, there have been 12 ministerial
conferences, usually every 2 years.
 It meets once every 2 years and can take decisions on all matters under any multilateral trade agreement.
 Unlike other organisations, such as IMF or WB, WTO does not delegate power to board of directors or
organisational chief. All decisions at WTO are made collectively and through consensus among member
countries at varied councils and committees.
 2022 WTO Ministerial Conference (12th MC) took place in Geneva, Switzerland.
→ 2022 WTO Agreements:
 In 2022, WTO’s 164 members (12th Ministerial Conference) in historic step approved series of trade agreements
including commitments on fish, partial waiver of IP rights for COVID-19 vaccines, and pledges on health and food
security. They are:
• On Fisheries: WTO countries agree to check on Illegal Unreported and Unregulated (IUU) fishing, and
overfishing; no subsidies for fishing in areas outside of RFMOs (regional fisheries management
organizations) and EEZ; and strict control on overfished areas. India’s demand for curb on non-specific fuel
subsidies for fisheries is not accepted. This WTO pact says that members will need to come out with
comprehensive disciplines within next 4 years, or see current agreement terminated. [This fishing subsidies
deal has potential to reverse collapsing fish stocks]. [Overfishing refers to exploiting fishes at pace faster
than they could replenish themselves — currently standing at 34% as per UNFAO].
Page 108 of 719
 • On Food security: WTO member countries agree to not impose export prohibitions or restrictions on
foodstuffs purchased for humanitarian purposes of WFP. (except for ensuring domestic food security).
However, WTO could not reach agreements on issues such as permissible public stockholding threshold for
domestic food security, domestic support to agriculture, cotton, and market access.
• IP on Covid vaccines: WTO agrees to allow countries to produce Covid vaccines patented elsewhere, without
any consent and limit on their export.
• E-commerce mortorium: WTO agrees to extend moratorium (temporary prohibition) on imposing customs
duties on electronic transmission. This moratorium is in place since 1998 and developing countries are losing
revenue because of it. India had opposed any further extension.
• WTO reforms: WTO agrees to revive its Dispute Settlement Body (DSB). Also, focus area for WTO will be -
Gender, Enviroment, MSME.
 India:
• India’s Leadership: India has been able to secure favourable outcome at this WTO MC after many years,
despite strong global campaign against Indian farmers and fishermen.
• India expressed concern that some suggestions on reforming WTO could eventually damage developing
nations more. Concerns raised by India at 12th MC WTO [2022]:
 On Fisheries and E-commerce: Removal of subsidies will hurt fishermen. So, India demanded to make
extensive exceptions on 20-year negotiation to harmful government fishery subsidies. India is seeking
broad exemptions for its fishing industry, including 25-year phase-in period and 200-nautical-mile
exclusion for its artisanal anglers (one fishing technique).
 On E-commerce: India fears that new rules could provide pretext for unfair mandatory market access
to foreign companies. This will hurt rapidly growing domestic e-commerce sector, which is still
developing in India.
 On Food: WTO should renegotiate subsidy rules for government-backed food purchasing programs
aimed at feeding poor citizens in developing and poor countries. India wants assurances that its public
stock-holding program, which buys exclusively from India’s farmers and has exported in past, cannot
be challenged at WTO as illegal.
 On vaccines: India wants to waive IP rights for vaccines and extend WTO ban on digital duties.
 On Special and differential treatment (S&D): S&D must continue, as such treatment has been treaty-
embedded and non-negotiable right for all developing members.
 Principles are sacrosanct: Ensure that multilateral rule-making processes are neither bypassed nor
diluted. Principles of non-discrimination, predictability, transparency and most importantly, tradition
of decision-making by consensus need to remain sacrosanct.
Note:
 WTO Appellate Body [1995]:
→ standing committee of 7 members that presides over appeals against judgments passed in trade -related
disputes brought by WTO members.
→ Countries involved in dispute over measures alleged to break WTO agreement or obligation can approach
WTO Appellate Body if they feel panel report needs to be reviewed on points of law.
→ However, existing evidence is not re-examined. But legal interpretations are reviewed.
→ WTO Appellate Body can uphold, modify, or reverse legal findings of WTO panel that heard dispute.
→ Countries on either or both sides of dispute can appeal.
Value Addition:
→ India ratified Trade Facilitation Agreement (TFA) of WTO. TFA is part of WTO’s Bali Ministerial Package of
2013. TFA entered into force in 2017.
Mains Link:
 The World Trade Organization has today become a victim of its own success. Critically discuss. (15M)
 For India, though the multilateral trading system embodied by the WTO provides security and predictability. India has
had a chequered relationship with the World Trade Organisation (WTO). Examine. Also, Suggest reforms that needs to
be undertaken in the WTO. (250 words)

DIGITAL TAX
News:
 2021:
→ Finance Bill, 2021 clarified that offshore e-commerce platforms don’t have to pay equalisation levy if they
have permanent establishment or if they pay any income tax here in India. However, foreign firms who do
not pay any tax here in India will have to pay equalisation le vy.
→ G7 endorses new global corporate tax deal i.e. agreed to minimum global tax rate of 15% for multinational
corporations (MNC) [MNCs to pay fairer share of taxes in jurisdictions where they make money and profits,
so as to end MNCs choosing least tax country and taking advantage of tax havens][This is major reform of
international tax system].

Page 109 of 719

 → India joins “OECD / G20 Inclusive Framework on BEPS”. That is, in major reform of international tax system,
many countries, including India, agree to overhaul of global tax norms to ensure that multinationals pay
taxes wherever they operate and at minimum 15% rate. [However, this deal requires countries to remove
all digital services tax, other similar unilateral measures and to commit not to introduce such measures in
future].
 2022:
→ Justifying 2% equalisation levy (EL) imposed by India on supply of services by multinational enterprises,
finance minister Nirmala Sitharaman says it is sovereign right to tax revenues earned from operations in
India.
→ GOI (Income Tax Dept.) clarifies that TDS on virtual digital assets continues to be 1%.
→ India’s equalization levy, or so-called Google tax on offshore digital economy firms, is set to stay beyond 2023,
because this global tax deal for digital economy taxation and plan for minimum global corporate tax rate of 15% has
faced implementation challenges.
→ India won't make sovereign commitment on future digital services tax and may delay implementation of global tax
deal. In move that could delay implementation of one global tax deal, India and other developing countries under
G24 grouping have objected to proposal of making sovereign commitments to not introduce any future digital
services tax like equalisation levy. Developing countries are of view that any commitment to not enact future
measures should be in nature of political commitments only.
 Background: In order to streamline global governance of digital companies such as Google, Facebook, one global
tax deal under OECD’s 2-pillar plan was agreed upon in 2021 (including by India). 2 pillars are - Under pillar 1, all
multinational enterprises (with turnover over 20bn Euro and profit of over 10%) will have to relocate part of
their profit to place where they sell their products; and under Pillar 2, all enterprises (with revenue over EUR
750mn) will have to give minimum corporation tax of 15%. It will bring in global minimum corporation tax to be
implemented from 2023.
About:
 Digital tax scheme:
→ GOI in its Finance Bill of 2020-21, imposed 2% digital service tax on trade and services of foreign e-commerce
companies such as Amazon and Walmart-owned Flipkart and others having annual turnover of Rs. 2 crore or more.
 Arguments:
→
{against digital tax} {favour of digital tax}
USA says digital service tax (DST) is discriminatory India says digital services tax (DST) is not discriminatory.
because: Reason / need:
a. DST does not extend to identical services a. Digital services provided by non-resident firms
provided by non-digital service providers. prevent need for physical presence in India,
b. DST discriminates against US digital businesses and profits earned in India could easily escape
as it specifically excludes from its ambit Indian income tax net.
domestic (Indian) digital businesses. b. Changing International Economic Order i.e.
India provides large markets for digital services
and thus seeks greater right to tax incomes.
 Concerns:
→ Eventually, digital service tax (DST) may become burden for Digital Consumers.
→ Digital service tax (DST) could invite retaliatory tariffs from other countries, - US imposed on France.
→ Digital service tax (DST) would result in double taxation.
 Global initiatives:
→ France levies 3% digital services tax.
→ In ASEAN region, Singapore, Indonesia, Malaysia levy digital service tax on foreign digital service providers.
→ Negotiations are underway at OECD.
→ GAFA Tax:
 named after Google, Apple, Facebook, Amazon.
 digital tax.
 to be levied on large technology and internet comp anies.
 France decides to introduce GAFA tax from digital activities.
→ OECD / G20 Inclusive Framework on BEPS:
 OECD-G20 tax agreement / deal.
 to reform international tax rules and ensure that multinational enterprises pay their fair share
wherever they operate
 Two pillar deal:
• Multinational enterprises – transnational companies, digital companies - pay tax where they operate and
earn profits.

Page 110 of 719

 •Dealing with low-tax jurisdictions: to address cross-border profit shifting and treaty shopping; to have global
minimum corporate tax rate, proposed at 15%.
 Significance:
• Tax havens (Bahamas, British Virgin Islands etc.) and low tax countries (Netherlands, Luxembourg etc.) could
lose their advantages.
 Impact on India:
• India will have to roll back Equalisation levy that India imposes on companies - Google, Facebook, Amazon
etc.
• India will need to evaluate tax under OECD / G20 Inclusive Framework on BEPS agreement.
 Digital Tax in India:
→ What:
 To ensure that value created digitally is appropriately taxed, India introduc ed below significant
amendments in Indian taxation laws in recent past:
• Equalization Levy, 2016
• Significant Economic Presence (SEP)
→ Need:
 India has 2nd-largest online users in world
 Hence, digital tax in India can not be neglected.
 However, Indian tax laws were suited for conventional business models.
 Thus, digital tax laws are required in India.
→ Equalisation Levy / Equalization Levy / EL [2016]:
 What:
• Direct tax, which is withheld at time of payment by service recipient. Tax aimed at foreign digital companies.
It is imposed under Finance Act, 2016 and not under Income Tax 1961.
• It is direct tax (of 6%), introduced in India in 2016 to tax foreign firms (such as Google, Facebook). It was
reaffirmed in Finance Act, 2020 and expanded to include non-resident e-commerce operators (such as
Amazon), by one new levy of 2% (digital service tax).
 History:
• In 2016, India imposed 6% equalisation levy on online advertisement services provided by non-
residents like Google, other foreign online advertising service providers.
• In 2020, India expanded its scope by imposing 2% equalisation levy on digital transactions by
foreign entities operating in India; and foreign entities having access to local (Indian) market, i.e.
foreign companies selling goods and services online to customers in India. This effectively means
introduction of digital tax in India.
• Its scope was further widened in Finance Act 2021-22 by covering e-commerce supply or service when any
activity takes place online.
 Reason:
• Equalisation levy was imposed to give level playing field between Indian businesses who pay tax in India and
foreign e-commerce companies who do business in India but do not pay income tax in India.
 Applicability:
• To foreign companies doing digital businesses in India but that do not have taxable presence in
India.
 Non-applicability:
• Finance Act, 2021-22 says offshore e-commerce firms that sell through Indian arm i.e. if they have
permanent establishment or if they pay any income tax here in India.
 Scope:
• online advertising
• nearly all online commerce activities done in India
 Tax:
• 2% of revenues.
→ In 2019, India ratified “Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base
Erosion and Profit Shifting, 2017” of OECD.
→ India’s Digital tax, 2020:
 Applicability: only to non-resident companies
 Scope: online sales of goods and services to Indians.
→ In 2021, India became signatory of “OECD / G20 Inclusive Framework on BEPS”.
Note:
 Tax Deduction at Source (TDS):
→ What:
 TDS in India is means of collecting tax on income, dividends, or asset sales by requiring payer (or legal
intermediary) to deduct tax due before paying balance to payee (and tax to revenue authority).
Page 111 of 719
  TDS is one mode of collection of taxes by which certain % of amounts are deducted by person at time
of making / crediting specific nature of payment to other person and deducted amount is remitted to
Government.
 It is one indirect method of collecting tax.
→ Aim:
 TDS is aimed at collection of revenue at very source of income.
→ Feature:
 It combines concepts of “pay as we earn” and “collect as it is being earn”.
 Under Indian Income Tax Act, 1961, income tax must be deducted at source as per its provisions. Any
payment covered under this law shall be paid after deducting prescribed % of income tax.
 It is managed by Central Board for Direct Taxes (CBDT) and is part of Department of Revenue managed
by Indian Revenue Service.
 Assessee is also required to file return to CBDT. Returns states TDS deducted & paid to government.
→ Significance:
 It has great importance while conducting tax audits.
→ TDS on virtual digital assets:
 What:
• GOI applies taxation on gains arising from cryptocurrency assets (tax on income from virtual digital assets)
i.e. cryptocurrency taxations.
 Need:
• There has been phenomenal rise in such transactions and magnitude and frequency of these transactions
have made it imperative to provide for specific tax regime.
 Argument:
•
{for} {against}
GOI argues that tax on digital assets is useful in
tracing transactions and preventing tax evasion
 Global Corporate Tax Deal, 2021:
→ What:
 to make companies pay in countries where they do business so as to counter tax avoidance.
 global minimum 15% corporate tax rate / floor rate [to avoid countries undercutting each other].
 by G7
→ Need:
 minimum rate is to discourage shifting of multinational operations and profits overseas.
 minimum rate is to address low tax rates of world’s biggest corporations - Apple, Alphabet, Facebook.
These companies typically rely on subsidiaries to shift profits out of major markets into low-tax
countries – Ireland, Caribbean nations etc.
→ Concerns:
 Encroaches on right of sovereign nations to decide nation’s tax policy.
 Global minimum tax rate will not do much in tackling tax evasion.
→ Is G7’s 2021 global corporate tax deal, end of tax havens?:
 May not end tax havens entirely, but it will surely reduce.
 Base Erosion and Profit Shifting (BEPS):
→ tax planning strategies used by multinational enterprises that exploit gaps and mismatches in tax rules to
avoid paying tax.
→ Developing countries’ higher reliance on corporate income tax means developing countries suffer from
BEPS disproportionately, and cost lost revenue annually.
→ Phenomenon where companies shift their profits to other tax jurisdictions, which usually have lower rates,
thereby eroding tax base in say India.
Value Addition:
 Online Information Data Base Access and Retrieval (OIDAR) services [India]:
→ Before 2016, in India, cross-border Online Information Data Base Access and Retrieval (OIDAR) services
were taxed in country of service provider, and thus, overseas providers providing services to Indian
customers were not liable to tax in India; however, Indian providers had to pay tax.
→ After 2016 new service tax legislation, in case of business -to-consumer (B2C) services, liable party to be
taxed will be overseas service provider providing services to government, local authority, governmental
authority, or individual in relation to any other purpose other than commerce, business. For business -to-
business (B2B) services, liable party will be Indian consum er who is recipient of such services under reverse
charge mechanism i.e. business entity receiving services will pay tax under reverse charge.
 Paradise Papers:

Page 112 of 719

 → Leaked files and leaked data from offshore service providers and company registries obtained by one
German newspaper.
→ Paradise Papers revealed offshore interests and activities of politicians, world leaders, celebrities and tax
engineering of multinational corporations spanning > 50 years.
→ Paradise Papersleak is important because if wrongdoing is found and exposed, these high -profile people
could be forced from office and/or stripped of their powers.
 Country-by-Country (CbC) Report:
→ BEPS Action Plan Report of OECD that seeks to provide template for multinational enterprises (MNEs) to report
annually and for each tax jurisdiction in which they do business.
 Tax Cheat:
→ individual or group who fails to pay tax required of them by law.
→ Depending on usage, it may also refer to individuals who use aggressive tax avoidance strategies though
technically following law.
→ people deliberately evading their taxes, although it can also refer to those who do so by accident.
 Tax Fraud:
→ individual or business entity willfully and intentionally falsifies information on tax return to limit amount
of tax liability.
→ cheating on tax return in attempt to avoid paying entire tax obligation.
→ Examples:
 claiming false deductions, claiming personal expenses as business expenses, using false Social Security number,
not reporting income, Tax evasion - illegally avoiding payment of taxes owed.
→ Tax fraud is different issue from tax avoidance / tax negligence.
 Trade Watch:
→ product of Trade and Regional Integration Unit of World Bank
→ it provides up-to-date data from many sources, along with analysis of r ecent trade developments.
→ From 2015-18 Trade Watch was yearly publication.
→ Since 2020, World Bank has produced monthly series, COVID-19 Trade Watch, that tracks trade flows in
aftermath of COVID-19 pandemic. It relies on real-time shipping data, official trade statistics for goods and
services, and other sources to provide perspective on how trade is responding to latest economic
developments.
Mains Link:
 Discuss the issues associated with the implementation of equalization levy.
 Discuss the need for a global minimum corporate tax.
 What are Country-by-Country (CbC) Report? Discuss their significance.

HEART
News:
 2022:
→ RTI reply reveals India’s financial capital Mumbai witnessed 6-fold rise in deaths related to heart attack in
2021 when it was under grip of Covid-19.
 Factors:
• Post-Covid development of thrombosis: SARS-Cov-2 damages heart and blood vessels in infected patients
which leads to development of clots, heart inflammation, arrhythmias, heart failure. Covid-19 can also cause
microvascular damages, which may have also contributed to heart ailments. [Thrombosis occurs when
blood clots block veins or arteries].
• Additional distress was noticed during Covid pandemic: Anxiety and stress levels further added to heart
ailments.
• Delay in diagnosis of heart-related ailment amid Covid wave: Many patients avoided hospitals due to fear
of contracting Covid-19, which further delayed life-saving treatment. Reperfusion therapies like
Thrombolytic therapy (that dissolves clots) and timely interventions like angioplasty (procedure used to
widen blocked or narrowed coronary arteries) were delayed.
• Better recording of heart-attack cases: Since start of Covid pandemic, medical practitioners are more
conscious of segregation and bifurcation of types of deaths as well as maintaining better data related to
heart attacks.
• Major lifestyle changes: Life had become more sedentary (seated) with fewer options for socialization,
physical activities. Doctors had witnessed increase in prevalence of diabetes, hypertension, smoking,
alcohol use and unhealthy lifestyle. Indians have genetic predisposition; smaller coronary arteries; diet
pattern with excessive consumption of trans fats; and sedentary lifestyle that puts them in high-risk
category for heart attacks.
About:
 Ailments related to Heart:

Page 113 of 719

 → Heart Attack: Medically called Myocardial infarction, is one serious medical emergency in which supply of
blood to heart is suddenly blocked, usually by blood clot. It is circulation issue.
→ Heart Failure: It is one chronic (long-term) condition in which heart cannot pump enough blood to meet
needs of body.
→ Cardiac Arrest: It occurs when heart malfunctions and stops beating unexpectedly. It is electrical issue.
Mains Link:
 Critically comment on the extent, scope and implications of Non-Communicable Diseases (NCDs) in India. (10M)
 Diseases of affluence are overtaking poverty disease in India reflecting the growing middle class. Elucidate (15M)

IUCN RED LIST / IUCN RED LIST OF THREATENED SPECIES / RED DATA BOOK [1964]
News:
 2021:
→ IUCN releases its latest Red List of Threatened Species.
 2022:
→ Kerala will soon have its own red list of birds. Once it gets ready, Kerala will be 1st State to have region-specific red
list of birds.
 Reason: Issues with IUCN List as there are limitations to global assessment because of its global context. Species
seen common at global level may be threatened species at regional level.
About:
 What:
→ World's most comprehensive inventory of global conservation status of biological species. It uses set of precise
criteria to evaluate extinction risk of thousands of species and subspecies. These criteria are relevant to all species
and all regions of world. With its strong scientific base, IUCN Red List is recognized as most authoritative guide to
status of biological diversity. Series of Regional Red Lists are produced by countries or organizations, which assess
risk of extinction to species within political management unit.
 IUCN Red List Categories:
→ 9 categories (in increasing risk of extinction): Not Evaluated (NE); Data Deficient (DD); Least Concern (LC); Near
Threatened (NT); Vulnerable (VU); Endangered (EN); Critically Endangered (CR); Extinct in wild (EW); Extinct (EX).
→ Threatened with extinction: VU, EN, CR.
 IUCN guidelines for preparing red list have 5 main criteria:
→ Population size reduction measured over 10 years or 3 generations.
→ Geographic range on basis of extent of occurrence or area of occupancy.
→ Small population size and decline.
→ Very small or restricted population.
→ Probability of extinction in wild.
 Usage:
→ It brings into focus ongoing decline of Earth’s biodiversity.
→ It brings into focus humans’ influence on life on planet.
→ It provides globally accepted standard to measure conservation status of species.
→ Scientists can analyze % of species in given category and change over time
→ Scientists can analyze threats and conservation measures.
Note:
 Latest IUCN Red List of Threatened Species:
→ About 900 species are officially extinct (EX). About 1/3rd of evaluated species face threat of extinction. Atlantic bluefin
tuna moved from EN to LC. Southern bluefin tuna moved from CR to EN. Komodo dragon (world’s largest living lizard)
– VU to EN. It is endemic to Indonesia and occurs only in World Heritage-listed Komodo National Park and
neighbouring Flores.

VACCINE
(GS2, GS3)
News:
 2020:
→ Hesitancy of Indian population to vaccinate COVID-19.
→ Even before final stage of human trials or regulatory approval, several wealthier countries – USA, Britain, France,
Germany etc. - entered into pre-purchase agreements with Covid-19 vaccine manufacturers.
 2021:
→ National average of Covid-19 vaccine wastage at about 6.5%.
→ 2021 UNGA president-elect warns against vaccine nationalism, says that vaccine nationalism would destroy
countries’ efforts to eradicate COVID-19 pandemic and must be avoided at all costs. He also says disparity in
vaccination coverage in developed countries and rest of world is unacceptable.

Page 114 of 719

 → Amid Covid-19 pandemic, airlines, governments, organizations around world are experimenting with vaccine
passports.
→ At 2021 G7 meet, India Union Health Minister said that India was strongly opposed to vaccine passport.
→ Covishield, manufactured by Serum Institute of India (developed by Oxford-AstraZeneca), is not among vaccines
approved by European Medicines Agency (EMA) / EU for its vaccine passport programme that allows free movement
of people in and out of Europe.
 Reason:
• Serum Institute of India has not to EMA applied for Covishield’s approval.
• EMA takes into consideration local manufacturing facilities. That is, even if vaccine is same, different
manufacturers of same product need to submit separate applications for approval from EMA.
[Vaxzevria (Oxford-AstraZeneca) - has been approved by EMA for vaccine passport programme.]
→ Goa becomes 2 nd State to complete 100% 1 st dose covid vaccination [after Himachal Pradesh].
 2022:
→ Biological E. Ltd. (vaccine maker based in Hyderabad) is selected to receive mRNA technology from WHO
technology transfer hub.
→ One California based pharmaceutical company developes ARCT-154 (self-amplifying mRNA vaccine against
Covid-19 infection).
 Benefits: ARCT-154 offered 95% protection against severe Covid-19 and 55% against Covid infection.
→ Vaccine hesitancy in news.
→ One study by Lancet Infectious Disease estimates that Covid-19 vaccines prevented nearly 1.98 crore deaths
worldwide in 1 st year of vaccine programme, including 42.10 lakh deaths prevented in India.
 Observations:
• Majority of Indians are fully vaccinated: India began vaccination in January 2021. According to Health
Ministry, to date, cumulative vaccination coverage exceeds 196.62 crores. More than 65% of Indian
population are fully vaccinated.
• Global inequalities: This Lancet study found high- and upper-middle-income countries accounted for
greatest number of prevented deaths, highlighting inequalities around world.
 Importance:
• Huge impact: This Lancet data shows remarkable impact that Covid vaccination has had, especially in India,
which was 1st country to experience impact of Delta variant.
→ iNCOVACC Intranasal SARS-CoV-2 vaccine: Bharat Biotech's ChAd36-SARS-CoV-S COVID-19 (Chimpanzee
Adenovirus Vectored) recombinant nasal vaccine has been approved by CDSCO for primary immunization
against COVID-19 in 18+ age group for restricted use in emergencies. This is India’s 1 st intranasal vaccine
for COVID-19. iNCOVACC is stable at 2-8°C for easy storage and distribution.
About:
 What:
→ Vaccines train our immune system to fight disease-causing agent when it invades our body in future.
→ Traditional vaccines are made up of: small / inactivated doses of disease-causing organism (pathogen) itself;
or disease-causing proteins produced by disease-causing organism.
 Vaccination:
→ What:
 method to teach immune system to trigger antibodies and specialised immune -system cells in case of
future infection by actual virus.
 Working:
→ It (small, inactivated or protein) is introduced into human body. Vaccines have component called - antigen, usually
part of pathogen against which vaccine is being developed. Vaccine provokes human body into recognizing it as
foreign material. Said antigen activates immune system so as to develop protective antibodies [but said antigen does
not have ability to cause full-fledged disease]. Human body’s immune system mounts defensive response to it. This
way, once person is fully vaccinated, he develops antibodies and remains protected.
→ In short, vaccines work by imitating bacteria or virus using mRNA or dead or weakened version of Bacteria or Virus.
Vaccines prepare body’s immune system to recognize and fight virus. When body encounters real virus (say Corona),
it releases antibodies specific to combat virus.
 Types:
→ There are 3 main approaches to designing vaccine. Their differences lie in whether they use:
 whole virus or bacterium; or
 just parts of germ / virus / bacterium that triggers immune system; or
 just genetic material that provides instructions for making specific proteins and not whole virus.
→ Whole-microbe approach:
 Inactivated vaccine:
• made using virus that were killed, making them unable to infect or replicate.
• Injecting it induces response from body by creating antibodies against dead virus.

Page 115 of 719

 • Pathogens (viruses, bacteria) that cannot multiply cannot cause disease.
• So inactivating virus or bacteria, using chemicals - formalin, can convert them into safe immunogen [antigen
or any substance that may be specifically bound by immune system].
• Because inactivated viruses / bacteria do not multiply, multiple doses of vaccine are needed. Another
substance to improve immune response — adjuvant – may be needed. Most common adjuvant is alum. One
adjuvant is shark oil suspensions.
• Many vaccines developed in China, India are on inactivated platform.
• Ex - Covaxin.
• Usage against: Hepatitis A, Flu, Polio, Rabies.
 Live-attenuated vaccines:
• weakened (attenuated) form of germ that causes disease.
• Because these vaccines are so similar to natural infection, they create strong and long-lasting immune
response. Just 1 or 2 doses of live vaccines can give us protection for lifetime.
• Limitations:
 Because they contain small amount of weakened live virus, some people should talk to their health care
providers before receiving them, esp. those with weakened immune systems, long-term health
problems, or people with organ transplant.
 need to be kept cool, so they travel is issue and thus can’t be used in countries with limited access to
refrigerators.
• Usage against: Measles, Mumps, Rubella (MMR combined vaccine); Rotavirus; Smallpox; Chickenpox;
Yellow fever.
 Viral vector vaccine:
• Non-replicating, weakened, genetically modified version of virus
• used to deliver virus DNA gene into human. i.e. virus is used to carry target antigen gene into human
cells.
• Virus DNA gene produces viral proteins and body’s immune is triggered.
• Types of viral vector:
 Adenovirus vectors:
o most widely known viral vector
o cause very mild colds or asymptomatic infections in humans
o Ex – Covishield: Covishield uses chimpanzee adenovirus, that carries SARS-CoV-2 spike protein.
Chimpanzee adenovirus has been used because humans will not have pre-existing antibodies to
this adenovirus.
 …….
→ Subunit approach / Subunit vaccine:
 Uses part of virus to trigger immune response.
 Because these vaccines use only specific pieces of germ, they give very strong immune response that’s
targeted to key parts of germ.
 can be used on almost everyone, including people with weakened immune systems, long -term health
problems.
 Limitation: This vaccine needs booster shots to get ongoing protection against diseases.
 Usage against - Hepatitis B
 Vaccine makers use Recombinant DNA technology to produce this kind of vaccine.
 Different protein subunit vaccines may use different parts of virus, like Corbevax covid vaccine uses spike protein
on virus’s surface.
→ Genetic approach (nucleic acid vaccine):
 nucleic acid vaccine just uses section of genetic material that provides instructions for specific proteins,
not whole microbe.
 DNA and RNA are instructions our cells use to make proteins.
 In our cells, DNA is 1st turned into messenger RNA, which is then used as blueprint to make specific
proteins.
 Nucleic acid vaccine delivers specific set of instructions to our cells, either as DNA or mRNA, for them to
make specific protein that we want our immune system to recognize and respo nd to.
 Types:
• RNA vaccine / m-RNA vaccine / messengerRNA vaccine:
 What:
o Type of vaccine that uses copy of molecule called mRNA to produce immune response. This vaccine
delivers molecules of antigen-encoding mRNA into immune cells, which use designed mRNA as
blueprint to build foreign protein that would normally be produced by pathogen (virus etc.) or by
cancer cell. These protein molecules stimulate adaptive immune response that teaches body to
identify and destroy corresponding pathogen or cancer cells. mRNA is delivered by co-formulation

Page 116 of 719

 of RNA encapsulated in lipid nanoparticles that protect RNA strands and help their absorption into
cells.
o synthetic version of mRNA that virus uses to build its infectious proteins.
o mRNA vaccines trick body into producing some of viral proteins itself. mRNA is molecule that
essentially puts DNA instructions into action. Inside cell, mRNA is used as template to build protein.
o mRNA vaccine uses messenger RNA that encodes spike protein of coronavirus.
 Feature:
o mRNA directs cell to produce copies of spike protein, so that immune system will recognise spike
if and when actual infection takes place, and mount response.
o messenger RNA (mRNA) instructions tell cells what virus protein to build, and body’s immune is
triggered.
o It works by using mRNA - molecule that essentially puts DNA instructions into action. Inside cell,
mRNA is used as template to build protein.
o mRNA technology works by teaching our cells to recognize and protect us against infectious
diseases.
o It is has neither small / inactivated pathogen nor disease-causingproteins produced by pathogen.
o It has set of instructions meant for human body in order to produce disease-causing proteins.
o That is, disease-causing proteins are not introduced from outside (like traditional vaccines do) but
instead are produced by humanbody in the body itself as per the instructions received from m-RNA
vaccines.
o new vaccine technology platform
o mRNA vaccines trick body into producing some of viral proteins by itself
 Working:
o RNA vaccine contains messenger RNA, which contains instruction to make SARS-CoV-2 spike
protein. For mRNA to enter human muscle cell at injection site, it is packaged inside one very smal
fatty particle.
o It is delivered into human body.
o mRNA instructs cells to produce coronavirus spike protein. Human body’s cells read it as
instructions to build disease-causing protein by using m-RNA as template for building it.
o Human body’s cells create some disease-causing proteins in isolation i.e. they do not assemble
together to form the pathogen – virus, bacteria etc.
o Human body’s immune system detects these harmful proteins and produces defensive response
to them. That is, body’s defence system recognises spike protein as foreign and begins to protect
itself against it.
 Challenge:
o mRNA vaccines must be kept cold to maintain stability during transport and storage.
 Example:
o Covid vaccines of Pfizer and BioNTech
o mRNA-1273 (Moderna’s COVID-19 Vaccine)
 Significance:
o There are 2 parts of our immune system: innate immune system (defences we’re born with); and
acquired immune system (develops as we come into contact with pathogens). Classical / traditional
vaccines usually work only with acquired immune system and thus another ingredient called
adjuvant is added to it to activateinnate immune system. However, m-RNA vaccines can trigger
innate immune systemwithout adding adjuvants and thus providing extra layer of defence.
 Relevance:
o Globally, mRNA vaccines are in lead in United States and Europe because mRNA can use recent
advances in molecular biotechnology and are quicker to manufacture than older, well-established
vaccine design principles.
o Worldwide, messenger RNA, or mRNA, vaccines have been in great demand after some studies
indicated that they are highly effective in preventing Covid infection and breaking Covid chain.
 mRNA technology:
o This technology works by teaching our cells to recognize and protect us against infectious diseases.
o One challenge with this new technology is that it must be kept cold to maintain stability during
transport and storage.
• Self-amplifying mRNA vaccines:
 What:
o Self-amplifying mRNA vaccine is improvement on traditional RNA platform. It encodes 4 extra
proteins in addition to vaccine antigen, and these enable amplification of original strand of RNA
once inside cell.
 Significance:
o Basic advantage is that it requires smaller dose.
 Example:
Page 117 of 719
 o ARCT-154 – Covid mRNA vaccine developed by one California based pharmaceutical company in
2022.
• DNA vaccine:
 genetically engineered DNA molecules coded with antigen.
 body’s immune is triggered.
 Usage:
• Nucleic acid approach is new way of developing vaccines.
• Before COVID-19 pandemic, none had yet been through full approvals for use in humans, though some DNA
vaccines - for cancers etc. - were undergoing human trials. Because of COVID-19 pandemic, research in this
area has progressed very fast and some mRNA vaccines for COVID-19 are getting emergency use
authorization (EUA), which means they can now be given to people beyond using them only in clinical trials.
 COVID vaccination:
→ Vaccination Issues during COVID:
 Issue of patent vs public health.
 India did not have enough production capacities which led to rise of 2 nd wave.
 Compulsory licensing and even if this license is issued, there was no necessary capability to develop same
vaccine by other companies.
 Lack of uniform vaccine pricing across all States causing Federal disputes.
 Issue of vaccine hesitancy
 Vaccine diplomacy and scarcity of vaccines in India.
 Several senior citizens and adult citizens in Andhra Pradesh who have not visited any vaccine centre after
2nd dose were taken aback on receipt of messages that they had ‘received’ dose as per CoWIN. People
received SMSs on their phone numbers used for earlier doses that have been successfully administered
with 3rd dose and certificates were also generated.
→ Way Forward:
 India should increase its vaccine production capabilities
 Global pooling of resources and compensation of private players for innovation and improve vaccine
availability to all nations.
Note:
 National Technical Advisory Group on Immunisation (NTAGI):
→ In India, NTAGI is India’s top advisory group on immunization. It is India's one drug regulator. It is only after
recommendation of NTAGI that vaccine is included in immunisation programme and allowed to be sold in
private market.
→ Note: Globally, National Immunization Technical Advisory Group (NITAG) is one advisory committee
consisting of multidisciplinary groups of experts responsible for providing information to national
governments that is used to make evidence-based decisions regarding vaccine and immunization policy.
Majority of industrialized and some developing countries have formally established advisory committees to
guide immunization policies; other countries are working towards establishment of such committees.
 Booster Dose:
→ Booster strengthens one’s immune system against particular pathogen. It may be exactly same original
vaccine; in which case its goal is to increase magnitude of protection by producing more antibodies. Aim is to
protect people from new variant, version of virus that is mutated significantly from original version people
were vaccinated against. These shots are only for fully vaccinated.
 Recombinant vector vaccines (platform-based vaccines):
→ Recombinant vaccines are protein or DNA recombinants that are produced by expression in bacterial or
yeast systems. It uses specific pieces of germ – like its protein, sugar, or capsid (casing around germ). These
vaccines act like natural infection, so they're especially good at teaching immune system how to fight germs.
 Technology transfer hub – WHO [2021]:
→ WHO’s technology transfer hub to build capacity in low- and middle-income countries to produce mRNA
vaccines through centre of excellence and training (mRNA vaccine technology hub). This hub is located at
Afrigen, Cape Town, South Africa, and will work with network of technology recipients (spokes) in low - and
middle-income countries.
→ Primarily set up to address Covid-19 emergency. It has potential to expand manufacturing capacity for other
products as well, including treatments, and target other priorities such as malaria, HIV, cancer.
 HGCO19:
→ India’s 1 st homegrown mRNA COVID-19 vaccine
→ being developed by Gennova Biopharmaceuticals (Pune-based)
 Recombinant:
→ In 1980s, scientists figured out how to combine DNA from two or more sources. This is called Recombinant
DNA technology. When virus’ genetic code is inserted into yeast cell, yeast starts making virus proteins.
 Vaccine Nationalism:

Page 118 of 719

 → What:
 when country manages to secure vaccines for its own citizens or residents before they are made available in
other countries.
 Country (govt.) prioritises vaccines for its own citizens / nationals / residents first, before said vaccines are made
available to other countries.
 by signing pre-purchase agreements between govt. and vaccine manufacturers.
→ History:
 Vaccine nationalism is not new.
 During early stages of 2009 H1N1 flu pandemic, some wealthiest countries – USA, Australia - entered into pre-
purchase agreements with several pharmaceutical companies working on H1N1 vaccines.
 All countries that negotiated pre-purchase orders were developed economies.
→ Concerns:
 initial few vaccines would be unaffordable and inaccessible to everyone, apart from rich countries.
 harmful for equitable access to vaccines.
 disadvantage for countries with fewer resources and bargaining power.
 deprives populations in global south from timely access to vaccines.
 allocates vaccines to moderately risk countries (wealthier) and deprives to higher risk developing countries.
→ Way forward:
 Equity in both accessibility and affordability of vaccines for populations across world.
 International institutions — WHO, GAVI (Vaccine Alliance) etc. — should coordinate negotiations ahead of
potential next pandemic for equitable access to vaccines during public health crises.
 Vaccine Diplomacy.
 Vaccine Diplomacy:
→ What:
 branch of global health diplomacy in which country uses development or delivery of vaccines to strengthen ties
with other nations.
→ India (Vaccine diplomacy of India):
 India supplied: Hydroxychloroquine, Remdesivir, paracetamol tablets, diagnostic kits, ventilators, masks, gloves,
other medical supplies, to many countries to help them deal with COVID-19 pandemic.
 India contributed to international COVAX programme to supply vaccines to lower-income countries.
 India carried out capacity building and training workshops for neighbouring countries.
 However, later, India also imposed some restrictions on exports.
 Vaccine Wastage:
→ What:
 Wastage of vaccine.
 It is expected to occur in any large vaccination drive.
→ Stages where vaccine wastage occurs:
 Cold chain points.
 District vaccine stores.
 Vaccination session sites.
→ How:
 In unopened vials via crossing of expiry date, exposure to heat, vaccine is fro zen, theft.
 In opened vials via discard of leftover doses, not able to draw out number of doses, contamination,
poor vaccine administration practices.
→ Effect:
 inflates vaccine demand.
 increases unnecessary procurement.
→ Remedy:
 Maintain vaccine wastage at minimum.
 Regularly review vaccine wastage.
 Ensure timely utilisation of available vaccine stocks before expiry dates.
 Only eligible beneficiaries should be registered and vaccinated.
 Proper planning.
 Vaccination sessions should serve maximum beneficiaries.
 Proper training to vaccinators.
 Vaccine Hesitancy:
→ What:
 WHO defines it as delay in acceptance or refusal of vaccines despite availability of vaccination services.
→ Concern:
 It is among Top 10 threat to global health in 2020.

Page 119 of 719

  Hesitation even among medical community to take COVIC-19 vaccine.
 Vaccine is one of essential weapons in our war against pandemic. Vaccine Hesitancy will have -ve consequence
on our effort to control COVID-19 pandemic.
→ Way Forward:
 Address reasons behind COVID-19 vacine hesitancy.
 Government should engage local / tribal activists. [Ex. Chhattisgarh govt. engaging tribal activists in rural, remote
areas]
 Control fake news about vaccines – social media, facebook, twitter, instagram etc.
 Usage of posters, folk songs, so as to attract rural, tribal population.
 Govt. should make mandatory for surpanch, village heads, village representatives, ward members, MLAs etc. to
get themselves and their families vaccinated.
 Govt. should mandate employers to mandatorily get their employees vaccinated.
 Provide confidence to public: Provide information to public - let public know - about robustness of various
processes involved in drug/vaccine development like - clinical trial designs, trial conduct, trial monitoring, trial
analysis, trial reporting, trial regulatory reviews, approval followed by regulators.
 Vaccine Passport:
→ What:
 electronic record of vaccination
 Example – coronavirus vaccination certificate / record
→ History / Origin:
 Edward Jenner’s development of 1st known vaccine in 1796. This vaccine was against Smallpox.
→ Form:
 QR code; Digital / soft copy i.e. storage on mobile, laptop etc; Hard copy i.e. printed form.
→ Usage:
 mostly used for International travels.
→ Countries:
 Israel – 1st country to introduce vaccine certification system
 China also introduced usage of vaccine passport.
 India:
• India’s stand on vaccine passport:
 Though EU says green pass will not be compulsory, issue has attracted debate on concerns around
privacy and ethics.
 Though vaccine passport is attempt get back to normalcy, but it has given rise to concerns
over intrusion, privacy and curb on right to free movement.
 At 2021 G7 meet, India Union Health Minister said that India was strongly opposed to vaccine passport.
→ Challenges / criticisms:
 WHO is against introduction of Covid-19 vaccination proofs as requirement for international travels.
 Discriminatory: With vaccine coverage in population in developing countries low compared to developed
countries, vaccine passport programme could be highly discriminatory.
 Operational and Ethical Considerations:
 Tit for Tat among national governments in world.
 Regional power dynamics.
 Haves and have nots.
 Efficacy of vaccination: unknown facts regarding efficacy of vaccination in reducing transmission.
 Lack of uniformity: across jurisdictions, countries
 Preferential vaccination: Preferential vaccination of travellers could result in inadequate supplies of vaccines to
priority populations – elders etc.
Value Addition:
 Vaccination vs Immunisation:
→
{Vaccination} {Immunisation}
when vaccine is administered to person (usually by what happens in person’s body after vaccination of
injection) person. Vaccine stimulates person’s immune system so
that it can recognise disease and protect person from
future infection i.e. person becomes immune to
infection.
 Messenger RNA / mRNA technology:
→ It works by teaching our cells to recognize and protect us against infectious diseases.
→ One challenge with this new technology is that it must be kept cold to maintain stability during transport and
storage.
 Toxoid vaccines:
Page 120 of 719
 → Toxoid vaccines use toxin (harmful product) made by germ.
→ They create immunity to parts of germ instead of germ itself i.e. immune response is targeted to toxin instead
of whole germ.
→ Limitation: need booster shots to get ongoing protection against disease.
→ Usage against: Diphtheria, Tetanus.
 Green pass:
→ EU Digital Covid Certificate
→ created to restore freedom of travel for public and remove barriers on entry placed due to COVID-19 pandemic.
→ digital proof that person has either been vaccinated against COVID-19, or received –ve test result, or recovered from
COVID-19 viral infection.
→ This document is valid across all EU countries.
→ It will ease travel restrictions across EU.
→ But, it is not absolutely compulsory.
 Conjugate vaccine:
→ What:
 One type of subunit vaccine which combines weak antigen with strong antigen as carrier so that immune system
has stronger response to weak antigen.
→ Why:
 Most vaccines contain single antigen that body will recognize. However, antigen of some pathogens does not
elicit strong response from immune system, so vaccination against this weak antigen would not protect person
later in life. In this case, conjugate vaccine is used in order to invoke immune system response against weak
antigen. In conjugate vaccine, weak antigen is covalently attached to strong antigen, thereby eliciting stronger
immunological response to weak antigen.
Question:
 Bacteria and viruses are used as vectors in ‘Recombinant Vector Vaccines’.
 Pneumococcal Conjugate Vaccines are effective against pneumonia, meningitis, sepsis. These vaccines can reduce
dependence on antibiotics that are not effective against drug-resistant bacteria. These vaccines have side effects and
cause allergic reactions.
Mains Link:
 “The COVID-19 vaccination drive demonstrates that India has become Atmanirbhar in vaccination against infectious
diseases”, Elucidate. (10M)

ECONOMIC SYSTEM / ECONOMIC ORDER

About:
 What:
→ One system of production, resource allocation and distribution of goods and services within society or
given geographic area. It includes combination of various institutions, agencies, entities, decision -making
processes and patterns of consumption that comprise economic structure of given community.
→ Economic system is one type of social system. Mode of production is one related concept. All economic
systems must confront and solve 4 fundamental economic problems:
 What kinds and quantities of goods shall be produced.
 How goods shall be produced.
 How output will be distributed.
 When to produce.
 Main types:
→ Capitalism:
 Capitalism generally features private ownership of means of production (capital) and market economy for
coordination. Corporate capitalism refers to capitalist marketplace characterized by dominance of hierarchical,
bureaucratic corporations.
Modern capitalism has favored free trade to take advantage of increased efficiency due to national
comparative advantage and economies of scale in larger, more universal market. Some critics have applied term
neo-colonialism to power imbalance between multi-national corporations operating in free market vs. seemingly
impoverished people in developing countries.
→ Mixed economy:
 There is no precise definition of "mixed economy". Theoretically, it may refer to economic system that combines
one of 3 characteristics:
• public and private ownership of industry; or
• market-based allocation with economic planning; or
• free markets with state interventionism.
In practice, "mixed economy" generally refers to market economies with substantial state interventionism and
/ or sizable public sector alongside dominant private sector.

Page 121 of 719

 → Socialist economy:
 Socialist economic systems (all of which feature social ownership of means of production) can be
subdivided by their coordinating mechanism (planning and markets) into :
• planned socialist; and
• market socialist systems.
Additionally, socialism can be divided based on their property structures between those that are based
on public ownership, worker or consumer cooperatives and common ownership (i.e. non -ownership).
Communism is one hypothetical stage of socialist development articulated by Karl Marx as "2 nd stage
socialism" in Critique of Gotha Program, whereby economic output is distributed based on need and
not simply on basis of labor contribution.
 Types based on resource allocation mechanism:
→ Market economy:
 It is like "hands off" systems, such as laissez-faire capitalism.
→ Planned economy:
 What:
• It is like "hands on" systems, such as state socialism.
• It is also known as "command economy" when referring to Soviet model.
• It is one type of economic system where investment, production and allocation of capital goods takes place
according to economy-wide economic plans and production plans. Planned economy may use centralized,
decentralized, participatory or Soviet-type forms (central planning) of economic planning. Level of
centralization or decentralization in decision-making and participation depends on specific type of planning
mechanism employed.
 Example:
• Market economies that use indicative planning are variously referred to as planned market economies,
mixed economies, or mixed market economies.
• …
→ Mixed economy:
 It is one hybrid that blends some aspects of both market economy and planned economy.
 Question: Whether centrally planned economies can allocate scarce resources efficiently?
→ Austrian school argument: No, centrally planned economies cannot allocate resources efficiently. Reason:
 Absence of private property: In case of centrally planned economy, there would be no market for resources and
hence no rational resource allocation.
 People, in general, would have very little incentive to work hard when rewards are different.
 Lack of information: Group of central planners managing economy would not have sufficient information to
allocate scarce resources under their control efficiently. Since, resources are owned by government, knowing
true price for resources becomes difficult.
 Market economy by default ensures resources to most needy: When resource owners sell their resources to
whoever is ready to pay highest price, they thus ensure that resource is allocated to those who need it most.
→ Socialist argument: Yes, because markets are not essential for rational allocation of resources. Reason:
 Cater to genuine need of society: Central planning board can allocate resources according to plan that takes into
account genuine needs of society.
→ In conclusion, middle ground would be moving towards mixed economy, where prices are determined by private
sector but essential services are in hands of government to enable resource allocation to poor.
Question:
 Which of following are associated with ‘Planning’ in India?
→ (1) FC
→ (2) National Development Council
→ (3) Union Ministry of Rural Development
→ (4) Union Ministry of Urban Development
→ (5) Parliament
Answer: All. For Central Planning process, Parliament is associated through MPLADS while NDC is part of that process.
NITI Aayog collaborates indirectly with FC though FC is not directly associated with planning process. In present
framework of NITI Aayog, CMs of State and Union Misters are part of Ex-Officio members.
Mains Link:
 The planning in India is a mixed bag of achievements and shortcomings. However, there is a lot many unfulfilled tasks
which are yet to be achieved. Examine. (250 words)

SALT
News:
 2022:
→ Farmers and workers engaged in Salt Industry are facing crisis as they lack minimum wage and social security.

Page 122 of 719

About:
 Salt sector / Salt industry in India:
→ Intro: India is 3rd largest salt producing country in world after China, USA, as of 2022. Growth and achievement of
Salt Industry over last 60 years has been spectacular. When India attained Independence in 1947, salt was being
imported from UK mainly to meet its domestic requirement. But today India has achieved self-sufficiency in
production of salt to meet its domestic requirement and also is in position of exporting surplus salt to foreign
countries. Salt Industry is labour intensive in India.
→ Law / regulation:
 Salt is Central subject in Constitution of India.
 Central Government is responsible for controlling all aspects of Salt Industry. Salt Commissioner’s Organisation,
attached Office under Ministry of Commerce & Industry is entrusted with this task.
→ Main sources of salt in India are:
 Sea brine; Lake brine; Sub-soil brine; Rock salt deposits. [Sea water is inexhaustible source of salt. Salt
production along India’s coast is limited by weather and soil conditions].
→ Process:
 Salt is mainly produced through solar-evaporation process of seawater.
→ Major salt producing centers:
 Marine Salt works along coast of Gujarat, Tamil Nadu, Andhra Pradesh, Maharashtra, Orissa, West Bengal.
 Inland Salt Works in Rajasthan using lake brine and sub-soil brine from Sambhar Lake (in Rajasthan), etc.
 Salt works in Rann of Kutch using sub-soil brine.
 Rock Salt Deposits in Himachal Pradesh.
→ Salt producing States: Gujarat (almost 80% of India’s production), Tamil Nadu, Rajasthan (through mining),….
→ Salt export:
 India exports surplus production of salt to China, Japan, Bangladesh, Indonesia, South Korea, North Korea,
Malaysia, U.A.E., Vietnam, Quatar, etc.
→ Concern:
 Occupational health hazards related to salt include Chronic dermatitis (skin ulcers), vision loss.
→ GOI’s role in development of salt industry:
 GOI has adopted strategy of Universal Salt Iodisation and Consumption for elimination of Iodine Deficiency
Disorders (IDD) under National Iodine Deficiency Disorders Control Programme (NIDDCP) [1962]. Iodine is
supplemented in diet through Iodised Salt for combating IDD. As on date, significant progress has been made on
Universal Salt Iodisation.
 GOI has number of Labour Welfare Schemes for improving working and living conditions of salt labourers. [Salt
Industry is labour intensive in India].
 GOI delicensed Salt Industry, in line with policy of Liberalisation and simplification of procedures.
 Salt Commissioner’s Organisation (nodal agency) plays facilitating role in overall growth and development of Salt
Industry in India.

ECO-SENSITIVE ZONE (ESZ) / ECOLOGICALLY FRAGILE AREA (EFA)

News:
 2020:
→ MoEFCC declares part of Wayanad Wildlife Sanctuary, Kerala as ESZ.
→ Ministry of Environment, Forest and Climate Change notifies ESZ of Deepar Beel Wildlife Sanctuary,
Guwahati.
 2022:
→ Supreme Court directs that every protected forest, national park, wildlife sanctuary across India should
have mandatory eco-sensitive zone (ESZ) of minimum 1 km starting from their demarcated boundaries.
 Its directions:
• In case any national park or protected forest already has buffer zone extending beyond 1 km, that would
prevail.
• In case question of extent of buffer zone was pending statutory decision, then Supreme Court’s direction to
maintain 1-km safety zone would be applicable until final decision is arrived at under that law.
• Mining within national parks and wildlife sanctuaries shall not be permitted.
• Principal Chief Conservator of Forests and Home Secretaries of States will be responsible for compliance of
this judgment.
→ Farmers in Kerala are protesting against said Supreme Court’s 2022 order to establish 1-km Eco-Sensitive Zones
around all protected areas, wildlife sanctuaries and national parks.
About:
 What:

Page 123 of 719

 → Areas notified by MoEFCC under Environment (Protection) Act, 1986 around: Protected Areas, National
Parks, Wildlife Sanctuaries. Land within 10 km of boundaries of national parks and wildlife sanctuaries are notified
as Eco-Fragile Zones or Eco-Sensitive Zones (ESZ). Sometimes this 10km boundary can be increased or decreased.
 Aim:
→ To create shock absorber to protected areas by regulating and managing activities around them.
→ To act as transition area / zone - from high protection areas to lesser protection areas.
→ To regulate certain activities around National Parks, Wildlife Sanctuaries to minimise –ve impacts on fragile
ecosystem encompassing such protected areas.
→ To give effect to Environment Protection Act, 1986 which restricts industries in certain areas.
 Feature:
→ It is governed by Environment (Protection) Act, 1986, though word ESZ is not mentioned.
→ As per Wildlife Conservation Strategy, 2002, ESZ could extend up to 10 km around protected area.
→ Sensitive corridor / connectivity, ecologically important land patches, important for landscape linkage
should be included in ESZ.
 Implication:
→ No new commercial hotels, resorts are permitted, except for small temporary structures for eco -tourism
activities.
→ Hydroelectric projects, brick kilns, commercial use of firewood, discharge of untreated effluents in natural
water bodies or land areas are prohibited.
 Initiative:
→ Committee for ESZ: Gadgil Committee [2011], Kasturirangan Committee [2012].
 Significance:
→ ESZ will act as shock absorber to protected areas by regulating and managing activities around them , to
minimize -ve impact on “fragile ecosystems” by certain human activities taking place nearby.
→ ESZ will also act as transition area / zone - from high protection areas to lesser protection areas.
 Way Forward:
→ India’s natural resources have been for years ravaged by mining and other activities. Hence, government
should not confine its role to that of “facilitator” of economic activities for immediate upliftm ent of
fortunes of State. It has to act as trustee for benefit of general public in relation to natural resources so
that sustainable development could be achieved in long term.
Mains Link:
 Discuss the need for eco sensitive zones around the protected areas.

URANIUM (U)
News:
 2018:
→ Uranium reserves discovered in Andhra, Telangana.
 2021:
→ Maharashtra Anti-Terrorism Squad (ATS) arrest persons with natural uranium worth crores of rupees under
Atomic Energy Act, 1962 for possessing uranium without licence.
→ In violation of international laws, Pakistan is exploiting scope of uranium enrichment i n Pakistan-occupied
Gilgit-Baltistan [confirmed by locals and political activists].
→ Iran produces more enriched uranium, than what U.N. nuclear watchdog reported.
 2022:
→ Huge reserves of uranium found at Rohil in Rajasthan.
About:
 What:
→ Chemical element with atomic number 92.
→ It is one of rare minerals in world.
 Properties:
→ weakly radioactive because all isotopes of uranium are unstable.
→ high density
→ silvery-white metallic chemical element.
→ Uranium-235 (Uranium’s isotope) is only naturally occurring isotope, capable of sustaining nuclear fission.
 Occurrence:
→ naturally in low concentrations in soil, rock and water
→ commercially extracted from uranium-bearing minerals.
 Applications:
→ Uranium is mainly used for generating electricity and also for nucl ear energy, medicines, defence
equipment, photography.
→ nuclear power plants

Page 124 of 719

 → Shield against radiation: Depleted uranium is also used as shield against radiation in medical processes -
radiation therapy. Depleted uranium is also used as shield against radiation while transporting radioactive
materials.
→ Counterweight: Its high density makes Uranium useful as counterweights in aircraft, industrial machinery.
 Why U-235 is used in nuclear:
→ Atoms of U-235 can be easily split apart. (fission, E=mc2)
 Uranium enrichment:
→ Uranium (U) contains rare radioactive isotope - U-235, that can be used to power nuclear reactors at low
enrichment levels and to fuel nuclear bombs at much higher enrichment.
→ Aim is to raise % levels of U-235.
→ By using centrifuges — machines that spin unrefined uranium at high speeds.
 Reserves:
→ Largest producers of uranium in world - Kazakhstan, Canada, Australia.
 India:
→ Uranium Mining: In India, uranium deposits occur in Dharwar rocks ; Jharkhand (Singbhum Copper belt);
Rajasthan; Chhattisgarh; MH; HP; AP; Telangana.
→ Major uranium deposits of India: Rohil Fold Belt; Gogl Bhima Basin; Tummalapalle S Cuddapah Basin;
Lambapur, Chitrial N Cuddapah Basin; Jaduguda, Narwapahar Singhbhum Shear Zone; Domia siat, Wahkyn
Mahadeks.
→ India imports uranium mostly from Kazakhstan, Canada.
→ India has Uranium Corporation of India (one PSU).
Note:
 Enriched uranium above 90% can be used for nuclear weapons.
Mains Link:
 A recent report has highlighted uranium contamination in India’s groundwater. Discuss the causes, its effects and ways
to address the issue?

JULY, 2022
FINANCIAL SERVICES INSTITUTIONS BUREAU (FSIB) [2022]
News:
 2022:
→ Finance ministry is working to expand and relaunch BBB by bringing in more representatives from
insurance sector.
 BBB revamp plan:
• Addition of new member.
• Empower: Finance Ministry wants to legally empower BBB body to recommend candidates for public sector
insurers and accelerate top-level hiring at all State-run financial institutions.
• Restructure: BBB’s name and mandate will be changed. Newly revamped BBB (proposed entity) will
recommend candidates for appointments to senior management-level posts in state-run banks, insurance
companies, other financial institutions.
 Need for revamp:
• Delhi High Court 2021 order: Delhi High Court observed that BBB was not competent body to recommend
appointments at PSU general insurers, and held that circulars enabling BBB to select general managers and
directors of PSU insurers were not legally valid.
• Slow recruitment process: Despite BBB’s good work, recruitment to higher level has been slow. Also, BBB’s
extended 2-year term ended, and new recruitments can restart only when new body is in place.
 2022:
→ GOI transforms Banks Board Bureau (BBB), headhunter for directors of state-owned banks and financial
institutions, into Financial Services Institutions Bureau (FSIB) by making some amendments. BBB is now
struck down.
About:
 What:
→ One GOI body set up under Department of Financial Services (Min. of Finance). It has been constituted by
Central Government via resolution in exercise of power granted under National Bank for Financing
Infrastructure and Development Act, 2021 for purpose of recommending persons for appointment as
whole-time directors and non-executive chairpersons on Boards of financial services institutions and for
advising on certain other matters relating to personnel management in these institutions. Its secretariat
currently comprises of Secretary and 4 officers. [Nationalised Banks (Management and Miscellaneous
Provisions) Scheme, 1980 was also amended.]
→ FSIB will replace Banks Board Bureau (BBB) and FSIB will be much more than mere headhunter to fill in key
posts at state-run banks, insurers and other financial institutions (FIs). FSIB will be prof essional body with
autonomy in its affairs and will have its own secretariat.
Page 125 of 719
 → Primary role of FSIB is to identify manpower capabilities and ensure proper selection of talent for senior positions at
financial institutions owned by GOI. However, when BBB was brought into force in 2016, it was envisaged as body
that would efficiently corporatise and make government entities function like private players, but it didn’t make
much headway on that front. With FSIB, intent is to go beyond man-manager role and assist GOI in formulating code
of conduct and ethics for whole-time directors in these entities. It would also monitor and assess performance of
public sector banks, government-owned financial institutions and insurance companies.
 Vision:
→ Search and Select appropriate personages for Board of Public Sector Banks, Public Sector Financial Institutions and
Public Sector Insurance Companies and recommend measures to improve Corporate Governance in these
Institutions.
 Mission:
→ To promote excellence in Corporate Governance in Public Sector Financial Institutions.
 Function:
→ a) To recommend persons for appointment as whole-time directors (WTDs) and non-executive chairpersons (NECs)
on Boards of Directors in Public Sector Banks (PSB), financial institutions (FI) and Public Sector Insurers (PSI);
→ b) To advise GOI on matters relating to appointments, transfer or extension of term of office and termination of
services of said directors;
→ c) To advise GOI on desired management structure at Board level for PSBs, FIs and PSIs;
→ d) To advise GOI on suitable performance appraisal system for WTDs and NECs in PSBs, FIs and PSIs;
→ e) To build one databank containing data related to performance of PSBs, FIs and PSIs;
→ f) To advise GOI on formulation and enforcement of code of conduct and ethics for WTDs in PSBs, FIs and PSIs;
→ g) To advise GOI on evolving suitable training and development programmes for management personnel in PSBs, FIs
and PSIs;
→ h) To help PSBs, FIs and PSIs in terms of developing business strategies and capital raising plan etc.;
→ i) To carry out such process and draw up panel for consideration of competent authority for any other bank, financial
institution or insurer for which GOI makes reference, after consultation with regulator concerned with that bank,
financial institution or insurer.
 Why has FSIB replaced Banks Board Bureau (BBB)?
→ BBB was declared incompetent authority in 2021 by Delhi High Court, when one general manager at state-owned
National Insurance Company challenged appointment of one person junior to him for Director’s position by BBB.
Consequent to Delhi High Court order, 10–11 directors appointed by BBB vacated office. In view of this issue, BBB
had to be struck down and one new body, namely, FSIB had to be put in place vide approval from Appointments
Committee of Cabinet, headed by PM.
Note:
 National Bank for Financing Infrastructure and Development Act, 2021:
→ Act to establish National Bank for Financing Infrastructure and Development to support development of
long term non-recourse infrastructure financing in India including development of bonds and derivatives
markets necessary for infrastructure financing and to carry on business of financing infrastructure.
 Banks Board Bureau (BBB) [2016]:
→ What:
 One autonomous body of GOI (now struck down and replace by FSIB) tasked to search and select
appropriate members for Board of Public Sector Banks (PSB), Public Sector Financial Institutions (PSFI),
and Public Sector Insurance Companies (PSIC) and recommend (advisory body) measures to improve
Corporate Governance in these institutions. BBB is one self-governing autonomous and advisory body
of Central Government to improve management of public sector banks. It is autonomous
recommendatory body.
It was set up in 2016 as part of Indradhanush Plan for PSB [2015] and based on
recommendations of RBI-appointed Nayak Committee [2014] (Committee to review governance of
boards of banks in India). Central Government notified amendment to Nationalised Banks
(Management and Miscellaneous Provisions) Scheme, 1980 providing legal framework for composition
and functions of BBB in 2016.
→ Function:
 Make recommendations for appointment of highest personnel – directors, chairpersons - of PSBs,
state-owned Financial Institutions (FI). Ministry of Finance takes final decision on appointments in
consultation with PMO.
 To recommend selection and appointment of Board of Directors in Nationalised Banks, Financial
Institutions, PSIC (Whole Time Directors and non-executive Chairpersons). [BBB recommends for
selection of heads for PSB].
 To advise Central Government on matters relating to appointments, confirmation or extension of
tenure and termination of services of Directors of mandated institutions.
 To advise Central Government on desired management structure of mandated institutions, at level of
Board of Directors and senior management.
Page 126 of 719
  To advise Central Government on suitable performance appraisal system for mandated institutions.
 To build data bank containing data relating to performance of mandated institutions and its officers.
 To advise Central Government on formulation and enforcement of code of conduct and ethics for
managerial personnel in mandated institutions.
 To advise Central Government on evolving suitable training and development programs for managerial
personnel in mandated institutions.
 To help banks in terms of developing business strategies and capital raising plan.
 Any other work assigned by GOI in consultation with RBI.
→ Composition:
 Chairman (selected by central government); 3 Ex -officio members including one RBI Deputy Governor;
5 expert members of which 2 are from private sector.
Question:
 BBB recommends for selection of heads for Public Sector Banks. BBB helps Public Sector Banks in developing strategies
for capital raising and improving performance of PSBs. BBB makes recommendations for appointment of whole-time
directors as well as non-executive chairpersons of Public Sector Banks and state-owned financial institutions. Chairman
of public sector banks are selected by BBB. Bank Board Bureau is responsible for selection and appointment of board of
directors in Public sectors banks. Ministry of Finance takes final decision on appointments in consultation with PMO.
Mains Link:
 Discuss the roles and functions of BBB.

BEE
News:
 2020:
→ National Cooperative Development Corporation (NCDC) [1963 ] [statutory body] is working on popularizing
scientific beekeeping as source of livelihood for landless rural poor, small and marginal famers to
supplement agricultural income, enhance agriculture production and horticulture production.
 2021:
→ World Bee Day observed on May 20.
 2022:
→ World Bee Day observed on May 20.
→ Australia locks down its bees after detecting hive -killing mite (Varroa).
About:
 Significance:
→ Bees are some of most important pollinators, ensuring food and food security, sustainable agriculture, and
biodiversity.
 India:
→ Beekeeping / Apiculture:
 What:
• Maintenance of bee colonies, commonly in man-made hives, by humans. Most such bees are honey bees.
Beekeeper (apiarist) keeps bees in order to collect their honey and other products that hive produce
(including beeswax, propolis, flower pollen, bee pollen, royal jelly), to pollinate crops, or to produce bees
for sale to other beekeepers. Location where bees are kept is called apiary / bee yard.
 Initiative:
• National Beekeeping and Honey Mission (NBHM), 2020
• Promotion of Beekeeping as part of doubling farmers’ income.
• fund allocations towards Beekeeping under Atma Nirbhar Abhiyan.
• As part of NBHM, National Bee Board (NBB) provides beekeeping training to farmers. They are also
financially supported by Government.
• Government launched Honey Mission as part of Sweet Revolution.
 Significance:
• India is among world’s top 5 honey producers.
• Honey production has risen and exports have also risen.
• important contributor in achieving 2022 target of doubling farmer incomes.
 Way Forward:
• Expand scope:
 Beekeeping should not be restricted to honey and wax only.
 Products such as pollen, royal jelly and bee venom are also marketable and can greatly help Indian
farmers.
 Increase in area: India has potential to increase bee colonies.
 Increasing number of bee colonies will increase production of bee-related products.
 Increasing number of bee colonies will also boost agricultural and horticultural productivity.

Page 127 of 719

 • Recommendations of Economic Advisory Council to Prime Minister (EAC-PM):
 Plantation of bee friendly flora at appropriate places and engaging women SHG in managing such
plantations.
 Recognition of apiculture (beekeeping) as subject for advanced research under Indian Council for
Agricultural Research (ICAR).
 Training and development of beekeepers by State governments.
 Development of national and regional infrastructure for storage, processing and marketing of honey
and bee products.
 Simplifying procedures and specifying standards for easing exports of honey and bee products.
Note:
 Varroa mite:
→ It is one external parasitic mite that attacks and feeds on honey bees. Disease caused by these mites is
called varroosis. Varroa mite can reproduce only in honey bee colony. It attaches to body of bee and
weakens bee by sucking fat bodies. This species is one vector for at least 5 debili tating bee viruses.
→ Heavy infestations with varroa mite cause range of maladies among European honey bees that weaken and
reduce populations, leading to colony death. This parasite does not affect smaller, stingless native bees.
 World Bee Day:
→ May 20. Annually by UN. Birth anniversary of Anton Jansa - pioneer of beekeeping.
→ 2022 theme: “Bee Engaged: Celebrating diversity of bees and beekeeping systems”.
Mains Link:
 Discuss the significance and importance of beekeeping in India.

FOOD PROCESSING
News:
 2022:
→ Food Processing Ministry inks agreement with National Agricultural Cooperative Marketing Federation of
India (NAFED) for developing 10 brands as One District One Product (ODOP) brands under Pradhan Mantri
Formalisation of Micro food processing Enterprises (PMFME) Scheme.
 Implication: All products will be available at NAFED Bazaars, E-commerce platforms, prominent retail stores
across India.
→ PMFME achieves 2 years of its implementation.
→ Ministry of Food Processing launches one convergence portal between Agriculture Infrastructure Fund (AIF), Pradhan
Mantri Formalisation of Micro Food Processing Enterprises (PMFME) scheme, and PM Kisan SAMPADA Yojana
(PMKSY). This convergence portal of these GOI's 3 flagship schemes will help micro units engaged in food processing.
This convergence portal will allow beneficiaries of these 3 schemes to avail facilities hassle-free, and beneficiaries
will also get additional benefit of interest subvention at 3%.
About:
 Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PMFME) scheme [2020]:
→ What:
 Scheme to provide financial, technical, business support for upgradation / setting up of 2 lakh micro food
processing units based on One District One Product (ODOP) approach in 5 years from 2020-21 to 2024-25 with
outlay of Rs. 10,000 crore. Scheme for formalisation of micro food processing enterprises for unorganized sector
on all India basis. It is under MoFPI as part of AatamaNirbhar Bharat Abhiyan. It aims to enhance competitiveness
of micro-enterprises in food processing sector.
→ Objectives:
 Increased access to finance by micro food processing units. Increased revenues of micro food processing
enterprises. Enhanced compliance with food quality, safety standards. Strengthening capacities of support
systems. Transition from unorganized sector to formal sector. Special focus on women entrepreneurs,
Aspirational districts. Encourage Waste to Wealth activities. Focus on minor forest produce (MFP) in Tribal
Districts.
→ Features:
 Centrally Sponsored scheme (Government of India:States at 60:40). micro-enterprises will be assisted with credit
linked subsidy. Beneficiary contribution will be minimum (10%). Seed capital will be given to SHGs for loan to
members for working capital, small tools. States should identify food products e.g., perishable Agri-produce, and
cereal-based products. Cluster approach. With NULM, it will provide Seed capital to Area level Federation
involved in food processing for giving grants to micro-enterprises in that area. Focus on perishables. One District,
One Product; Support for Common Infrastructure; Support to SHGs, FPOs, co-operatives and individual Micro
Food Enterprises; Seed Capital for SHGs; Training & Research Support; Support for Capacity Building; Branding
& Marketing Support.
→ Mechanisms:
 It would be monitored at Centre by Inter-Ministerial Empowered Committee (IMEC) under Chairmanship of
Minister, MoFPI.
Page 128 of 719
  State / UT Level Committee (SLC) chaired by Chief Secretary will monitor and sanction / recommend for
expansion of micro units and setting up of new units by SHGs / FPOs / Cooperatives.
 States/ UTs will prepare Annual Action Plans for its implementation.
 States/ UTs Annual Action Plans will be approved by Government of India.
 3rdparty evaluation and mid-term review mechanism.
 National level portal would be set-up wherein applicants/ individual enterprise can apply to participate. All
scheme activities would be undertaken on said National portal.
→ Benefits:
 Nearly 8 lakh micro-enterprises will benefit through access to information, better exposure, formalization.
 It will enable micro-enterprises to formalize, grow, become competitive.
 likely to generate 9 lakh skilled and semi-skilled jobs.
 increased access to credit for micro food processing entrepreneurs, women entrepreneurs, entrepreneurs in
Aspirational Districts.
 integration with organized markets.
 Increased access to common services like sorting, grading, processing, packaging, storage etc.
→ Need:
 There are about 25 lakh unregistered (unorganized, informal) food processing enterprises which is about 98% of
sector.
 Nearly 65% of said unregistered food processing units are located in rural areas.
 Nearly 80% of said unregistered food processing units are family-based enterprises.
 This unregistered food processing units sector face challenges including inability to access credit, high cost of
institutional credit, lack of access to modern technology, inability to integrate with food supply chain, non-
compliance with health &safety standards.
→ Significance:
 Strengthening this unregistered food processing units segment will lead to reduction in wastage, creation of off-
farm job opportunities, aid in achieving doubling farmers’ income.
Note:
 Pradhan Mantri Kisan SAMPADA Yojana:
→ GOI’s one Central Sector Scheme. It is Scheme for Agro-Marine Processing and Development of Agro-Processing
Clusters crore for period 2016-20 coterminous with 14th Finance Commission cycle. It aims to create modern
infrastructure from farm gate to retail. This scheme will be implemented by MoFPI. It is one comprehensive package
which will result in creation of modern infrastructure with efficient supply chain management from farm gate to
retail outlet. It will not only provide big boost to growth of food processing sector in India but also help in providing
better returns to farmers and is big step towards doubling of farmers income, creating huge employment
opportunities especially in rural areas, reducing wastage of agricultural produce, increasing processing level and
enhancing export of processed foods.
→ Following schemes will be implemented under PM Kisan SAMPADA Yojana: Mega Food Parks, Integrated Cold Chain
and Value Addition Infrastructure, Creation / Expansion of Food Processing / Preservation Capacities (Unit Scheme),
Infrastructure for Agro-processing Clusters, Creation of Backward and Forward Linkages, Food Safety and Quality
Assurance Infrastructure, Human Resources and Institutions.
 One District One Product (ODOP) approach:
→ States would identify food product for one district.
Mains Link:
 Discuss the significance of the Scheme for formalisation of Micro Food Processing Enterprises (FME).

SPECIAL ECONOMIC ZONE (SEZ)

News:
 2021:
→ GOI proposes to free up unused built-up area and idle land inside SEZ for other economic activities.
 2022:
→ GOI says Special Economic Zones Act will be replaced with one new legislation that will enable States to
become partners in Development of Enterprise and Service Hubs (DESH).
 Why replace?
• WTO’s dispute settlement panel has ruled that India’s export-related schemes, including SEZ Scheme, were
inconsistent with WTO rules since they directly linked tax benefits to exports. Countries aren’t allowed to
directly subsidize exports as it can distort market prices.
• MAT and Sunset clause: SEZ started losing its allure after introduction of Minimum Alternate Tax and one
sunset clause to remove tax sops.
About:
 What:

Page 129 of 719

 → SEZ is one area in which business and trade laws are different from rest of that country. SEZs are located
within 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 zone, financial
policies are introduced. These policies typically encompass investing, taxation, trading, quotas, customs
and labour regulations. Additionally, companies may be offered tax holidays, where upon establishing
themselves in zone, they are granted period of lower taxation.
Creation of SEZ by host country may be motivated by desire to attract FDI. Benefits company gains by
being in SEZ may mean that it can produce and trade goods at lower price, aimed at being globally
competitive. In some countries, SEZ have been criticized for being little more than labor camps, with
workers denied fundamental labor rights.
→ Geographical ‘enclaves’ in which regulations and practices related to business and trade differ from rest
of country. Therefore, all units in SEZs enjoy special privileges.
→ under Special Economic Zones Act, 2005.
→ It is also one policy that focuses on exports.
 History:
→ 1st ever Export Processing Zone (EPZ) in Asia was set up by GOI in Kandla, Gujarat in 1965.
→ Based on success of Kandla EPZ, in 1980s, 7 more EPZs were set up including in Bombay, Noida, Madras,
etc.
→ To invite larger foreign investments in India, these EPZs were converted into SEZs in 2000 under one GOI
policy.
→ Then, now DESH will replace SEZ Act.
 Need:
→ It might be difficult to dramatically improve infrastructure and business environment of overall economy
‘overnight’. But, SEZs can be built in shorter time, and are efficient enclaves to solve infrastructure and
business problems.
 Objective:
→ To create additional economic activity.
→ To boost export of goods and services.
→ To generate employment.
→ To boost domestic and foreign investments.
→ To develop infrastructure facilities.
 Facilities and incentives:
→ Duty-free import / domestic procurement of goods for SEZ units.
→ Exemption from certain taxes
→ Single window clearance for Central and State level approvals.
 Concerns:
→ SEZs in India have not been as successful as SEZs in many other countries (China, Korea, Malaysia,
Singapore)
→ Many of India’s new generation SEZs came up not for exporting, but for avoiding taxes.
→ Most manufacturing SEZs in India have performed below par due to their poor linkages with rest of
economy. Example, weak connections of coastal SEZs with their hinterlands.
→ Ineffective single window clearance system because many States did not match central SEZ Act, 2005 with
State-level legislation.
→ Lack of robust policy design
→ Inefficient implementation
→ Ineffective monitoring.
 Significance:
→ SEZs account for about 1/3rd of India’s exports
→ Help towards industrialisation of India.
Note:
 Baba Kalyani committee:
→ constituted by Ministry of Commerce and Industry
→ to study existing SEZ policy of India.
 Development of Enterprise and Service Hubs (DESH):
→ Feature:
 Boost domestic manufacturing: DESH legislation would go beyond promoting exports and has much wider
objective of boosting domestic manufacturing and job creation through ‘development hubs’. These hubs will no
longer be required to be Net Foreign Exchange +ve cumulatively in 5 years (i.e, export more than they import)
as mandated in SEZ regime, and will be allowed to sell in domestic area more easily. These hubs will, therefore,
be WTO-compliant.

Page 130 of 719

  Single window portal: DESH legislation would also provide for one online single-window portal for grant of time-
bound approvals for establishing and operating these development hubs.
→ Will it be easier to sell in domestic market?
 Yes. Companies can sell in domestic market with duties only to be paid on imported inputs and raw materials
instead of final product. In SEZ regime, duty is paid on final product when product is sold in domestic market.
 Besides, there is no mandatory payment requirement in forex, unlike in case of SEZs.
 Equalization Levy: Under this legislation, GOI may impose one equalization levy on goods or services supplied to
domestic market to bring taxes at par with those provided by units outside.
→ Role of States in DESH:
 Larger role for States: In SEZ regime, most decisions were made by commerce department at Centre. Now, States
will be able to participate and even directly send recommendations for development hubs to one central board
for approval.
 State boards would be set up to oversee functioning of these development hubs. They would have powers to
approve imports or procurement of goods and monitor utilization of goods or services, warehousing, and trading
in development hub.
Mains Link:
 Critically analyse the social and economic costs of India’s SEZ policy. (250 words)

SUPERCOMPUTER / SUPER-COMPUTER
News:
 2022:
→ Ministry of Science And Technology (MST)’s annual year -end review says under National Super-Computer
Mission (NSM), 4 new Supercomputers are installed at IIT -Hyderabad, NABI-Mohali, CDAC-Bengaluru, IIT
Kanpur.
→ National Supercomputing Mission (NSM) deploys “PARAM Ganga” supercomputer.
→ PARAM PORUL Supercomputer inaugurated at NIT Tiruchirappalli, TN.
→ PARAM ANANTA - India’s super computer – unveiled.
→ According to TOP500 (project that ranks and details 500 most powerful non-distributed computer systems in world)
i.e. global ranking service of super-computers, India has only 3 top-ranked supercomputers among 500 and none in
top 100. (Param Siddhi, Param Ganga, Pratyush supercomputers). India’s supercomputing capabilities fall behind its
peers.
About:
 What:
→ computer with high level of performance as compared to general -purpose computer.
→ Supercomputer is computer that performs at or near currently highest operational rate for computers.
→ Performance of supercomputer is commonly measured in floating-point operations per second (FLOPS)
instead of million instructions per second (MIPS).
 Status:
→ US, China account for nearly 2/3rd of top 500 supercomputers in world.
→ Frontier: It is world’s fastest supercomputer, located at Oak Ridge National Laboratory, USA, and offers
peak performance of 1,685 PFlops.
 Benefits:
→ High-speed computation: E.g., in 2020, IBM’s Summit supercomputer, helped researchers find drug
compounds that could stop covid-19 virus from infecting host cells in just 2-3 days.
→ Other areas: chemistry formulations, protein folding, biomedicine, space (for satellite placements), climate
research.
 India:
→ National Supercomputing Mission (NSM) [2015]:
 What:
• Mission to improve number of supercomputers owned by India.
• Mission to connect national academic and R&D institutions.
• steeed jointly by MeiTY and Department of Science and Technology (DST).
• implemented by Centre for Development of Advanced Computing (C-DAC) [operating under MeitTY] and
Indian Institute of Science (IISc), Bangalore.
 4 major pillar:
• Infrastructure
• Applications
• R&D
• HRD.
 Feature:

Page 131 of 719

 •Supercomputers will also be networked on National Supercomputing grid over National Knowledge
Network (NKN).
• steered by Department of Science and Technology (DST) and Department of Electronics and Information
Technology (DeitY).
• Implemented by Centre for Development of Advanced Computing (C-DAC), Pune and Indian Institute of
Science (IISc), Bengaluru.
• It will provides access to High-Performance Computing (HPC) facilities to around 75 institutions, thousands
of active researchers, academicians working through Nation Knowledge Network (NKN).
• empowering national academic and R&D institutions spread over India by installing vast supercomputing
grid comprising of around 70 high-performance computing facilities.
• development of highly professional High Performance Computing (HPC).
 Achievement:
• Param Shivay (1stsupercomputer assembled indigenously) installed in IIT (BHU) in Varanasi.
• Param Shakti supercomputer installed at IIT-Kharagpur.
• Param Brahma supercomputer installed at IISER, Pune.
• Under Phase 2 of NSM, PARAM PORUL, state-of- art Supercomputer inaugurated at NIT Tiruchirappalli, TN
in 2022.
• Under NSM, till 2021, 15 supercomputers have been installed across India with aggregate compute capacity
of 24 petaflops. All these supercomputers have been manufactured in India and operating on indigenously
developed software stack.
→ Supercomputers of India:
 Param 8000:
• India’s 1st supercomputer.
 Param Shivay:
• 1st supercomputer assembled indigenously
• installed in IIT (BHU) in Varanasi.
 Param Shakti:
• supercomputer installed at IIT-Kharagpur.
• Weather and Climate, Computational Fluid Dynamics, Bioinformatics, Material science.
 Param Brahma:
• supercomputer installed at IISER, Pune.
• Weather and Climate, Computational Fluid Dynamics, Bioinformatics, Material science.
 PARAM Yuva II:
• One High Performance Computing (HPC) Cluster.
 PARAM Siddhi:
• AI
• India’s largest and fastest Supercomputer
• among world’s 100 most powerful supercomputers
• estd. under National Supercomputing Mission (NSM)
• It is as of 2021 102nd most powerful supercomputer in world.
 PARAM Ganga:
• Supercomputer at IIT Roorkee (Uttarakhand)
• supercomputing capacity of 1.66 Petaflops.
• designed and commissioned by C-DAC under NSM.
 Pratyush:
• weather forecasting
• among world’s 100 most powerful supercomputers
 PARAM PORUL [2022]:
• state-of-art Supercomputer
• established under National Supercomputing Mission (NSM).
 PARAM ANANTA [2022]:
• It has 838 TeraFlops supercomputing capability.
• It was commissioned at IIT Gandhinagar under National Supercomputing Mission (NSM).
• It is developed jointly by Centre for Development of Advanced Computing (C-DAC) and IIT, Gandhinagar.
• Param Ananta will rank behind C-DAC’s Param Siddhi-AI, which as of 2021 was 102nd most powerful
supercomputer in world.
Note:
 Teraflops:
→ unit of computing speed equal to 1 million million (10^12) floating -point operations per second (FLOPS).
 Petaflops:

Page 132 of 719

 → unit of computing speed equal to 1 thousand million million (10^15) floating -point operations per second
(FLOPS) or 1 thousand TeraFlops. [computing power of supercomputer is measured in floating -point
operations per second, or FLOPS].
 National Knowledge Network (NKN):
→ connects academic institutions and R&D labs over high-speed network.
→ multi-gigabit national research and education network
→ to provide unified high speed network backbone for educational and research institutions in India.
→ managed by National Informatics Centre (NIC).
 Rudra:
→ server system
→ indigenous server
→ developed by India indigenously
→ It can meet High-Performance Computing (HPC) requirements of all governments / PSUs
→ 1 st time that server system is made in India.
→ under National Supercomputing Mission (NSM).
→ Its full software stack is developed by Centre for Development of Advanced Computing (C -DAC)
Mains Link:
 Though India is a major player in Information Technology, it lacks self-dependence in the manufacture of critical
computing technology. Enumerate the steps the government is taking to fill this gap. (10M)

BUDGET
News:
 2021:
→ 2021-2022 paperless Union Budget.
 2022:
→ Budget Session of Parliament begins.
→ Finance minister Nirmala Sitharaman presents 2022 -23 budget worth Rs 39.45 lakh crore with massive
push to infrastructure spending.
→ In one report titled ‘Gender Mainstreaming in Governance’, Development Monitoring and Evaluation
Office (DMEO) (attached office under NITI Aayog and is NITI Aayog’s monitoring and evaluation office)
voices for finalising National Policy for Women and mainstreaming of gender-based budgeting across all
ministries and States through formulation of Gender Budgeting Act. According to this report, gender
budgeting is not practised in most States and is also not captured for many schemes in different sectors.
 DMEO recommendations:
• Improve social acceptance of transgenders: Under this report DMEO says there is need to improve social
acceptance of transgender persons in society.
• More allocation of funds: This report recommends that MoWCD should encourage State governments to
increase their budgetary allocation towards women and child development, protection and welfare
schemes.
• Policy on women: There is need to finalise National Policy for Women with revision in National Policy for
Women 2016 draft policy.
• Provide gender-disaggregated data: Absence of such data makes it difficult to measure true impact of
schemes resulting in poor strategy design.
Constitution:
 Article 112 (Annual financial statement):
→ President shall in respect of every financial year lay before both Houses of Parliament statement of
estimated receipts and expenditure of Government of India for that year, in this Part referred to as ―
annual financial statement.
→ Estimates of expenditure contained in annual financial statement shall show separately:
 sums required to meet expenditure described by this Constitution as expenditure charged upon
Consolidated Fund of India; and
 sums required to meet other expenditure proposed to be made from Consolidated Fund of India,
and shall distinguish expenditure on revenue account from other expenditure.
→ Following expenditure shall be expenditure charged on Consolidated Fund of India:
 emoluments and allowances of President and other expenditure relating to his office;
 salaries and allowances of Chairman and Deputy Chairman of Council of States and Speaker and Deputy
Speaker of House of People;
 debt charges for which Government of India is liable including interest, sinking fund charges and
redemption charges, and other expenditure relating to raising of loans and service and redemption of
debt;
 salaries, allowances and pensions payable to or in respect of Judges of Supreme Court;

Page 133 of 719

 pensions payable to or in respect of Judges of Federal Court;
pensions payable to or in respect of Judges of High Court;
 salary, allowances and pension payable to or in respect of Comptroller and Auditor-General of India;
 sums required to satisfy any judgment, decree or award of any court or arbitral tribunal;
 any other expenditure declared by this Constitution or by Parliament by law to be so charged.
About:
 Gender budgeting:
→ What:
 According to Council of Europe’s widely used definition, gender budgeting is application of gender
mainstreaming in budgetary process. It involves conducting gender -based assessment of budgets,
incorporating gender perspective at all levels of budgetary process, and restructuring revenues and
expenditures in order to promote gender equality. In short, gender budgeting is strategy and process
with long-term aim of achieving gender equality goals.
 It means preparing budgets or analyzing them from gender perspective. Also referred to as gender-
sensitive budgeting, this practice does not entail dividing budgets for women. It aims at dealing with
budgetary gender inequality issues, including gender hierarchies and discrepancies between women's
and men's salaries. At its core, gender budgeting is feminist policy with primary goal of re-orienting
allocation of public resources, advocating for advanced decision -making role for women in important
issues, and securing equity in distribution of resources between men and women. Gender budgeting
allows governments to promote equality through fiscal policies by taking analyses of budget's differing
impacts on sexes as well as setting goals or targets for equality and allocating funds to support those
goals. This practice does not always target intentional discrimination, but rather forces awareness of
effects of financial schemes on all genders.
 Gender budgeting is application of gender mainstreaming in budgetary process. It means gender-based
assessment of budgets, incorporating gender perspective at all levels of budgetary process and
reconstructing revenues and expenditures in order to promote gender equality. Gender Budget is: not
separate budget; not about spending same on women and men; and not just abo ut assessing
programmes targeted specifically at women and girls.
 Gender budgeting means preparing budgets or analyzing them from gender perspective. This practice
does not entail dividing budgets for women.
→ Significance:
 Gender Budgeting is powerful tool for achieving gender mainstreaming so as to ensure that benefits of
development reach women as much as men.
→ India:
 Evolution: During 2001-04, Gender-based analysis of Union and some States’ budgets starts. During
2005-10, Gender-based statement and Gender Budget Cell (GBC) charter issued. During 2010-12,
integrated gender and outcome budget. During 2012-2013, Guidelines for State level gender budgeting
issued.
 India has gender budget component since 2005-06 wherein schemes having allocations at least 30% for
women is highlighted.
 Beijing declaration on equality of men and women [1995] recommended Gender Budgeting.
 Influenced both expenditure and revenue policies:
 India’s gender budgeting efforts are unique because they not only influenced expenditure but also
revenue policies (like differential rates for men and women in property and Income tax rates)
 Gender Budgeting Cell (GBC): GBC has been mandated in each Ministries / Department.
 India ranked poor in 2022 Global Gender Gap Report
 In 2022-23 Budget, India has shifted its focus from women’s development to women-led development.
Over 1.7 lakh cr has been allocated for women-centric schemes under gender budget 2022-23, which is
increase of 5%.
 India’s Budget / Annual Financial Statement (AFS):
→ What:
 Budget is statement of estimated receipts and estimated expenditures of Government in financial year.
In Constitution under Article 112, Union Budget is referred to as Annual Financial Statement (AFS).
→ Feature:
 Budgeting process:
• Procedure for presentation of Budget in Lok Sabha and its passing by Lok Sabha is as laid down in
Article 112, Article 113, Article 114, Article 115, Article 116, Article 117; Rules of Procedure and Conduct of
Business in Lok Sabha; Directions by Speaker.
 Budget also contains:
• Estimated revenue receipts
• Estimated capital receipts

Page 134 of 719

 • Estimated expenditure
• Ways and means to raise revenue
• Actual receiptsof closing financial year and reasons for any deficit or surplus
• Actual expenditure of closing financial year and reasons for any deficit or surplus
• Economic and financial policy of coming year: taxation proposals, prospects of revenue, spending
programme, introduction of new schemes/projects etc.
 6 stages of Budget:
• Presentation: Budget is presented in Lok Sabha on such day as President may direct. Immediately after
presentation of Budget, following 3 statements under Fiscal Responsibility and Budget Management Act,
2003 are laid on Table of Lok Sabha: Medium-Term Fiscal Policy Statement; Fiscal Policy Strategy Statement;
Macro Economic Framework Statement.
• General discussion.
• Scrutiny by Departmental Committees.
• Voting on Demands for Grants.
• Passing of Appropriation Bill.
• Passing of Finance Bill.
Note:
 2022-23 Budget:
→ Total spending and Focus:
 To enhance job creation and boost economic activity.
 Total government spending will be 4.6% more than 2021 -22 year and additional support of Rs. 1 lakh
crore to States.
 Total expenditure in 2022-23 is estimated at Rs. 39.45 lakh crore, while total receipts other than
borrowings are estimated at Rs. 22.84 lakh crore.
 Outlay for capital expenditure is once again being stepped up sharply by 35.4% from Rs. 5.54 lakh crore
in 2021-22 year to Rs 7.50 lakh crore in 2022-23.
→ State of economy:
 Government projects India’s economy to grow by 9.2%.
 India’s GDP has crossed USD 3 trillion.
 Fiscal deficit is projected to be higher at 6.9%. Fiscal deficit of government for 2022 -23 is estimated to
be Rs. 16,61,196 crore.
 Soaring inflation levels continue to be concern for economy.
 Foreign exchange reserves stood at USD 634.287 billion, providing cover equivalent to 13 months of
imports.
→ Infrastructure development:
 PM GatiShakti National Master Plan will encompass 7 engines for economic transformation, seamless
multimodal connectivity, logistics efficiency. They are: roads, railways, airports, ports, mass transport,
waterways, logistics infrastructure. All 7 engines will pull forward economy in sync.
 400 new Vande Bharat trains will be introduced.
 Railways will also develop new products for small farmers, MSMEs.
 Integration of postal network and railways network facilitating parcel movement.
 Master plan formulated for highways, and targets to complete 25,000 km national highways in 2022 -23.
 Sovereign Green Bonds will be issued for mobilizing resources for green infrastructure.
 Data Centres and Energy Storage Systems will be given infrastructure status.
→ Agriculture and food processing:
 Budget allocation for Ministry of Agriculture and Farmers’ Welfare is Rs. 1,32,513 crore for 2022 -23 fiscal.
 ‘Kisan Drones’ will be promoted for crop assessment, digitisation of land records, spraying of
insecticides.
 Fund with blended capital raised under co-investment model through NABARD will be set up to finance
startups and rural enterprises working in agri-space.
 Zero-budget natural farming:
• Agriculture universities in India will be encouraged to include zero-budget natural farming areas in their
syllabus.
→ Education:
 One Digital University would be established to provide access to students across Ind ia for world-class
quality universal education.
 One Class one TV channel programme will be expanded to 200 TV channels.
 Virtual labs, skilling e-labs will be established to promote critical thinking skills, simulated learning
environment.
 Digital Ecosystem for Skilling and Livelihood:
• DESH-Stack e-portal would be launched.
Page 135 of 719
 → Healthcare:
 Health sector is allocated Rs. 86,200.65 crore.
 One National Tele Mental Health Programme will be launched to improve access to quality mental health
counselling and care services.
 One open platform for National Digital Health Ecosystem will also be rolled out.
 For National Health Mission, budget allocation is increased to Rs. 37,000 crore in 2022 -23.
→ Tax proposals:
 Taxpayers are allowed one-time window to correct omissions in income tax returns (ITR). They can file
updated returns within 2 years from assessment year.
 30% tax on income from transfer of virtual digital assets is also proposed.
 1% tax deducted at source (TDS) on transfer of virtual assets above threshold, gifts wo uld be taxed.
 Government will roll out digital rupee based on blockchain technology.
→ Boost for MSMEs:
 One Raising and Accelerating MSME Performance (RAMP) programme will be rolled out with Rs. 6,000
crore outlay spread over 5 years for MSMEs.
 ECLGS that provided much needed additional credit to over 1.3 crore MSMEs will be extended till March
2023 with its guarantee cover expanded to Rs. 5 lakh crore.
→ Prime Minister’s Development Initiative for North-East (PM-DevINE).
→ Ministry wise allocation (in rupees):
 Defence – 525.2K
 Consumer Affairs, Food & Public Distribution – 217.7K
 Road Transport & Highways – 199.1K
 Home Affairs – 185.8K
 Railways – 140.4K
 Rural Development – 138.2K
 Agriculture – 132.5K
 Chemicals & Fertilisers – 107.7K
 Communications – 105.4K
Mains Link:
 Discuss the concept of ‘Gender budgeting’ and analyse its significance in the Indian context. (250 words)

BIO-DIVERSITY / BIODIVERSITY / BIOLOGICAL DIVERSITY

News:
 2021:
→ Kunming Declaration [2021] adopted by countries parties to United Nations Convention on Biological
Diversity (UNCBD).
→ Biological Diversity (Amendment) Bill, 2021 introduced in Lok Sabha.
→ Senior Congress leader Jairam Ramesh expresses concerns over below contentious provisions of Biological Diversity
(Amendment) Bill, 2021. This includes:
 Exemption given to AYUSH practitioners from provisions of this law. This exemption could open this law for
abuse.
 Distinction has been made in this law between cultivated biodiversity and forest-based biodiversity.
 Appointment of 16 ex-officio officers of Government of India dilutes authority of National Biodiversity Authority
(NBA) [2003].
 NBA approval is required only at time of commercialisation of patent and not at time of application for patent.
 2022:
→ Kolkata becomes 1st major metropolitan city to prepare detailed register of biodiversity i.e. PBR.
→ India’s 1st Biotech Park inaugurated at Ghatti, Kathua district, JK. [This Biotech Park will carry out research on
biodiversity, medicinal and aromatic plants of JK and Ladakh, and it will also promote green category businesses.
CSIR-Indian Institute of Integrative Medicine, (CSIR-IIIM) Jammu will implement this project].
→ National Thermal Power Corporation Limited (NTPC Ltd) issues its renewed Biodiversity Policy, 2022.
→ As per one study by British Economists from British universities, loss of biodiversity will downgrade credit ratings of
several countries, including India, increasing their bankruptcy risk. [Sovereign credit ratings are independent
assessment that determines creditworthiness of country]. Its other findings:
 Economic loss out of ignoring biodiversity: Team claimed that investors and corporations ignoring biodiversity
loss from calculations could lead to market stability being undermined. They found that at least 58% of 26
countries would face detrimental impact.
 Sectors most affected: Partial ecosystem collapse of sectors such as fisheries, tropical timber production and
wild pollination. (based on World Bank Prediction).
 Worst affected: China and Malaysia would be worst affected.
 12 of 26 countries analysed will be at risk of bankruptcy.
Page 136 of 719
  On India: Downgrades for India and other countries means that they will be burdened with billions of dollars in
interest.
 Impact of biodiversity on economics:
• As nature-loss reduces economic performance, it will become harder for countries to service their debt,
straining government budgets and forcing them to raise taxes, cut spending, or increase inflation.
Developing countries are already in burden with crippling debt burdens driven by COVID-19 and soaring
prices, and loss of nature will hurt more.
• India: India’s debt burden is expected to increase to 8% of its GDP by 2022.
→ Intergovernmental science-policy Platform on Biodiversity and Ecosystem Services (IPBES) releases IPBES Assessment
Report on Sustainable Use of Wild Species. It is IPBES’s report on sustainable use of wild species of plants, animals,
fungi, algae around world.
→ UNFAO releases one report – “Mainstreaming biodiversity in forestry” - with the aim of embedding biodiversity
considerations into policies, strategies, and practices to promote the conservation and sustainable use of natural
resources.
About:
 Biodiversity Convention / Convention on Biological Diversity / United Nations Convention on Biological Diversity
(UNCBD) [1993]:
→ What:
 multilateral treaty
 secretariat - Montreal, Canada
 It is often seen as key document regarding sustainable development.
→ Objectives:
 conservation of biological diversity.
 sustainable use of components of biological diversity.
 fair and equitable sharing of benefits arising out of utilization of genetic resources.
→ Feature:
 legally binding framework
 operates under UNEP.
→ Areas:
 conservation of biodiversity
 sustainable use of biological resources
 equitable sharing of benefits arising from their sustainable use.
→ Significance:
 Many biodiversity issues are addressed - habitat preservation, intellectual property rights, biosafety, indigenous
people‘s rights.
→ India: party.
→ Aichi Targets / Aichi Biodiversity Targets:
 They were established by Convention on Biological Diversity (CBD) in effort to protect and conserve biodiversity
that supports global food security, health and clean water.
 There are 20 Aichi Targets. Aichi, whose capital is Nagoya, is one place in Japan.
 India amended its National Biodiversity Action Plan (NBAP) to cover all 20 Aichi targets into 12 National
Biodiversity Targets (NBT). As per India’s 6th National Report (NR6) submitted to Convention on
Biological Diversity (CBD), India is on track to achieve 9 out of its 12 NBTs.
→ National Biodiversity Strategies and Action Plans (NBSAP):
 One Article of CBD states that each Contracting Party shall, in accordance with its particular conditions and
capabilities:
• (a) Develop national strategies, plans or programmes for conservation and sustainable use of biological
diversity or adapt existing strategies, plans or programmes which shall reflect, inter alia, measures set out
in this CBD Convention.
• (b) Integrate, as far as possible and as appropriate, conservation and sustainable use of biological diversity
into relevant sectoral or cross-sectoral plans, programmes and policies.
 NBSAPs are principal instruments for implementing CBD at national level.
 India:
• CBD mandates each Party to prepare one NBSAP or equivalent instrument, and to ensure that this NBSAP
strategy is mainstreamed into relevant sectoral or cross-sectoral plans, programmes and policies.
Accordingly, GOI developed one National Biodiversity Action Plan (NBAP) [2008], and in consonance with
National Environment Policy (NEP) [2006].
• National Biodiversity Action Plan (NBAP) [2008]:
 NBAP draws from principle in NEP that human beings are at centre of concerns for sustainable
development and they are entitled to healthy and productive life in harmony with nature.

Page 137 of 719

  NBAP identifies threats and constraints in biodiversity conservation taking into consideration existing
legislations, implementation mechanisms, strategies, plans and programmes, based on which action
points have been designed.
 India amended its NBAP to cover all 20 Aichi targets into 12 National Biodiversity Targets
(NBT). And, as per India’s 6th National Report (NR6) submitted to CBD, India is on track to
achieve 9 out of its 12 NBTs.
→ Global Biodiversity Outlook (GBO):
 Periodic report on biological diversity, prepared by Convention of Biological Diversity (CBD). GBO
provides summary of status of biological diversity and analysis of steps being taken by global
community to ensure that biodiversity is conserved and used sustainably, and that benefits arising
from use of genetic resources are shared equitably.
 Global Biodiversity Outlook 5 (2020) warned that none of 20 Aichi targets (2010 to 2020) under
Convention of Biological Diversity [1993] have been met by global community.
 India:
→ Intro:
 India, megadiverse country with only 2.4% of world’s land area, accounts for 7-8% of all recorded species,
including over 45000 species of plants and 91000 species of animals. India’s biodiversity supports ecosystem
functions and services that are of great human value. For millions of Indians, biodiversity supports their very
livelihoods and ways of life.
→ Biological Diversity Act, 2002:
 What:
• Act to provide for: conservation of biological diversity, sustainable use of its components, fair and equitable
sharing of benefits arising out of use of biological resources, knowledge.
 Why:
• enacted to meet obligations under Convention on Biological Diversity (CBD) [1992], because India is party
to it.
 Goal:
• protect India’s rich biodiversity and associated knowledge against their use by foreign individuals.
 Feature:
• It provides mechanism for equitable sharing of benefits arising out of use of traditional biological resources
and knowledge.
• It seeks to check biopiracy, protect biological diversity, local growers through 3-tier structure of central
board, State boards, local committees. They are:
 National Biodiversity Authority (NBA): It will have power of civil court.
 State Biodiversity Boards (SBB)
 Biodiversity Management Committees (BMCs) in local bodies.
→ People’s Biodiversity Register (PBR):
 What:
• Register containing comprehensive information on locally available Bio-resources including landscape and
demography of particular area or village.
• Every local body shall constitute Biodiversity Management Committee within its area for purpose of
promoting conservation, sustainable use and documentation of biological diversity including preservation
of habitats, conservation of land races, folk varieties and cultivars, domesticated stocks and breeds of
animals and microorganisms and chronicling of knowledge relating to biological diversity.
 Need:
• Biological Diversity Act, 2002 made it mandatory for every local self-governing institution in rural and urban
areas to constitute Biodiversity Management Committees (BMC) within their area of jurisdiction. Once
constituted, Biodiversity Management Committees must prepare PBR in consultation with local people.
[Main function of BMC is to prepare People's Biodiversity Registers in consultation with local people].
→ India Biodiversity Award, 2012:
 initiated by Government of India, in partnership with UNDP India
 To recognize and honour outstanding models of: biodiversity conservation; sustainable use; governance at
grassroots level.
 Rupees 2 lakh cash prize and citation.
→ Way Forward (for India to ensure green growth and preserving biodiversity):
 Innovation in markets: E.g., Green Bond, Social stock exchange etc.
 Forest and Land transition: Employing landscape-level spatial planning to avoid, reduce and mitigate land-use
change, reversing land degradation. Example, India joined Bonn Challenge [2011] in 2015 with pledge to restore
26 mha of degraded and deforested land.
 Sustainable freshwater transition: Guaranteeing water flows, improving water quality, protecting critical
habitats, controlling invasive species, and safeguarding connectivity to allow recovery of freshwater systems

Page 138 of 719

 from mountains to coasts. Example, India’s minimum environment flow requirement, Namami Gange project
for river rejuvenation.
 Sustainable fisheries and oceans transition: Protecting and restoring marine and coastal ecosystems, rebuilding
fisheries, and managing aquaculture and other uses of oceans to ensure sustainability, and to enhance food
security and livelihoods. PM Matsya Sampada Yojana, National Fisheries policy 2020.
 Sustainable agriculture transition: Redesigning agricultural systems through agroecological and other innovative
approaches to enhance productivity while minimizing negative impacts on biodiversity. Example, India ranks 1 st
in number of organic farmers, with Sikkim 1st State to be 100% organic.
 Sustainable food systems transition: Diversity of foods, and more moderate consumption of meat and fish, as
well as dramatic cuts in waste involved in food supply and consumption. Example, Lab-made meat, use of
seaweeds to produce edible protein, etc.
 Cities and infrastructure transition: Deploying ‘green infrastructure’ and making space for nature within built
landscapes to improve health and quality of life for citizens and to reduce environmental footprint of cities and
infrastructure. Example, National Building Code, Energy Conservation Building Code (ECBC), rating programs,
such as LEED-India.
 Sustainable climate action transition: Employing nature-based solutions, alongside rapid phase-out of fossil fuel
use, to reduce scale and impacts of climate change. Example, India’s is set to over-achieve its INDC target of
2030 by wide margin (as per Climate Action Tracker).
 Biodiversity-inclusive One Health transition: Managing ecosystems, including agricultural and urban ecosystems,
as well as use of wildlife, through integrated approach, to promote healthy ecosystems and healthy people.
Example, number of Protected Areas under Wildlife Protection Act, 1972 in India has increased.
 Kunming Declaration [2021]:
→ Aim:
 to mainstream biodiversity protection in decision-making
 to recognise importance of conservation in protecting human health.
→ Feature:
 Signatory nations to support development, adoption and implementation of effective post-2020
implementation plan
 Signatory nations to support capacity building action plan for Cartagena Protocol on biosafety [2000].
 Signatory nations should contribute to conservation and sustainable use of biodiversity, promoting sustainable
and inclusive development.
→ Significance:
 Signatory nations to synchronize Biodiversity plans with 3 UN decades program: ‘Sustainable Development’;
‘Ecosystem Restoration’; ‘Ocean Science for Sustainable Development’.
 Status:
→ Global Biodiversity Outlook 5 (2020) warned that none of 20 Aichi targets (2010 to 2020) under Convention
of Biological Diversity [1993] have been met by global community. [India amended its National Biodiversity
Action Plan (NBAP) to cover all 20 Aichi targets into 12 National Biodiversity Targets (NBT). As per India’s
6th National Report (NR6) submitted to Convention on Biological Diversity (CBD), India is on track to
achieve 9 out of its 12 NBTs.]
 Conclusion:
→ United response will make it possible to achieve 30×30 target to protect at least 30% of global ocean and
30% of land areas and inland waters by 2030 through effectively and equitably managed, ecologically
representative, and well-connected systems of protected areas.
Note:
 EU Biodiversity Strategy for 2030:
→ It is EU’s one comprehensive, ambitious, long-term plan for protecting nature and reversing degradation of
ecosystems. It aims to put Europe's biodiversity on path to recovery by 2030 with benefits for people, climate and
planet. It aims to build societies’ resilience to future threats such as climate change impacts, forest fires, food
insecurity or disease outbreaks, including by protecting wildlife and fighting illegal wildlife trade. It is one core part
of European Green Deal (striving to be 1st climate-neutral continent) and as such this Biodiversity Strategy will also
support green recovery following COVID-19 pandemic.
→ Nature Restoration Law [2022]:
 This proposed restoration law will require Member States to develop national plans to restore at least 20% of
EU land and sea by 2030, and repair all ecosystems in need of restoration by 2050. It will also ensure that decline
in pollinator populations is reversed by 2030, that peatlands are rewetted, marine habitats are restored, and
river barriers are removed, allowing 25,000 kilometers of rivers to be free flowing.
 It also includes reducing chemical pesticide use by 50% (by 2030), increasing tree canopy (by at least 10%) and
allowing free-flow of rivers.
 Nagoya Protocol [2010]:
→ What:
 Nagoya Protocol on Access and Benefit-sharing to Genetic Resources
Page 139 of 719
  supplementary agreement to 1992 Convention on Biological Diversity (CBD).
 signed in Nagoya (Japan).
→ Aim:
 implementation of 1 of 3 objectives of CBD i.e. fair and equitable sharing of benefits arising out of genetic
resources and thereby contributing to conservation and sustainable use of biodiversity.
→ Feature:
 It sets out obligations for its parties to take measures about access to genetic resources, benefit-sharing and
compliance.
 2010 Biodiversity Target:
→ It was overall conservation target that aimed to halt decline of biodiversity by end of 2010. World largely
failed to meet this target.
 Biological Diversity (Amendment) Bill, 2021:
→ Why:
 People from AYUSH medicine urged government to simplify, streamline, reduce compliance burden so as to
provide conducive environment for collaborative research and investments.
 People from AYUSH medicine sought to simplify patent application process, widen scope of access, widen scope
of benefit-sharing with local communities.
→ Provisions:
 This Bill seeks to reduce pressure on wild medicinal plants by encouraging cultivation of medicinal plants.
 This Bill proposes to exempt AYUSH practitioners from intimating biodiversity boards for accessing biological
resources or knowledge.
 This Bill will facilitate fast-tracking of research, simplify patent application process, decriminalises certain
offences.
 This Bill will bring more foreign investments in biological resources, research, patent, commercial utilisation,
without compromising national interest.
 This Bill focuses on regulating who can access biological resources and knowledge.
 This Bill clarifies and strengthens role of State biodiversity boards.
→ Concerns:
 Main focus of 2021 bill is to facilitate trade in biodiversity and not conservation, protection of biodiversity,
protection of knowledge of local communities.
 2021 bill was introduced without seeking public comments as required under pre-legislative consultative policy.
 Activists say 2021 amendment bill was brought in to “solely benefit” AYUSH Ministry.
 2021 bill excluded term Bio-utilization, which is important element in 2002 Act.
 2021 bill exempts cultivated medicinal plants from 2002 Act. But it is practically impossible to detect which
plants are cultivated and which are from wild.
 In 2022, Senior Congress leader Jairam Ramesh expressed concerns over below contentious provisions of
Biological Diversity (Amendment) Bill, 2021. This includes:
• Exemption given to AYUSH practitioners from provisions of this law. This exemption could open this law for
abuse.
• Distinction has been made in this law between cultivated biodiversity and forest-based biodiversity.
• Appointment of 16 ex-officio officers of Government of India dilutes authority of National Biodiversity
Authority (NBA) [2003].
• NBA approval is required only at time of commercialisation of patent and not at time of application for
patent.
 NTPC Biodiversity Policy, 2022:
→ What:
 Biodiversity Policy of National Thermal Power Corporation Limited issued by it in 2022.
 It is part of NTPC’s Environmental Policy and its objectives are aligned with environmental and sustainability
policies.
→ Objective:
 To support all professionals of NTPC Group to help them contribute toward achievement of targets set in this
field.
 To achieve ’no net loss’ of biodiversity at all of its currently operating sites and ensure there is net positive
balance wherever applicable.
 To mainstream concept of biodiversity across NTPC’s value chain and adopt precautionary approach for
sustainable management of biodiversity in all decision-making processes.
→ Significance:
 It is expected that overall conservation will increase with participation from business / firm’s side.
 It is expected that better practices of conservation will be known and will yield better results.
 It is expected that grass root participation will make people feel more connected to cause.
 Biotech Park:
Page 140 of 719
 → It will carry out research on biodiversity, medicinal and aromatic plants.
 Intergovernmental science-policy Platform on Biodiversity and Ecosystem Services (IPBES) [2012]:
→ What:
 IPBES is one intergovernmental organization established to improve interface between science and policy on
issues of biodiversity and ecosystem services. It is intended to serve similar role to Intergovernmental Panel on
Climate Change (IPCC).
 Its objective is to strengthen research, evidence-based policy making for conservation and sustainable use of
biodiversity.
 Its works include – Assessments, Policy Support, Building Capacity & Knowledge.
 Secretariat: Bonn, Germany.
→ IPBES Assessment Report on Sustainable Use of Wild Species:
 In 2022, IPBES released IPBES Assessment Report on Sustainable Use of Wild Species. It is IPBES’s report on
sustainable use of wild species of plants, animals, fungi, algae around world.
• Findings:
 Impact on biodiversity and wild species ecosystem: Major impact is through Climate change, landscape
and seascape changes, pollution and invasive alien species impact.
 Unsustainable exploitation: It is main threat to wild species in marine ecosystems and 2nd greatest
threat to those in terrestrial and freshwater ecosystems. Unsustainable hunting is main threat to wild
mammal species. Unsustainable logging and gathering are one of main threats for several plant groups,
notably cacti, cycads, and orchids as well as other plants and fungi harvested for medicinal purposes.
 On livelihood: Small-scale fisheries support over 90% of 120 million people and about 1/2th of people
involved in small-scale fisheries are women. 34% of marine wildlife is overfished. 50,000 wild species
globally can meet needs of billions of people. 70% of world’s poor population was directly dependent
on wild species.
 On indigenous people: Sustainable use of wild species is central to its identity, existence and livelihood.
• Recommendations:
 Empower indigenous communities: This report noted that indigenous people and local communities
used local knowledge, practices and spirituality for sustainable use of wild species. They respected
nature and only took what they needed.
 Robust fisheries management: Example, Atlantic bluefin tuna population has been rebuilt and is now
fished within sustainable levels.
 Effective regulations: Without effective regulations, unsustainable use and trade would increase,
leading to population collapse.
 Sustainable use of wild species can meet needs of billions.
 Other measures needed to save wild species: Integration of diverse value systems, equitable
distribution of costs and benefits, changes in cultural norms and social values and effective institutions
and governance systems would facilitate sustainable use of wild species in future.
 “Mainstreaming biodiversity in forestry”:
→ One report released by UNFAO in 2022 with the aim of embedding biodiversity considerations into policies,
strategies, and practices to promote the conservation and sustainable use of natural resources.
 Recommendations:
• Recognizing contributions of indigenous people and enhancing the equitable sharing of benefits. Preventing
natural forests into forest plantations. Control overharvesting of plants and wildlife. Mainstreaming
biodiversity. Providing compensation for reduced production due to the adoption of natural ways of farming
e.g. due to organic farming. Use of CSR commitments for biodiversity conservation.
Value Addition:
 Bonn Challenge [2011]:
→ One global effort to restore 150 million hectares of world's degraded and deforested lands by 2020 and 350 million
hectares by 2030.
→ It was hosted and launched by Germany and IUCN in Bonn in 2011, in collaboration with Global Partnership on Forest
/ Landscape Restoration.
→ Under this Bonn declaration: India aims to reach target of restoring 26 million hectares of degraded land by
2030. Additional carbon sink of 2.5 billion-3 billion tonnes of CO2 equivalent through forest and tree cover
is to be created by 2030. [India joined Bonn Challenge in 2015].
 Biodiversity hotspot:
→ Biodiversity hotspot concept was developed by Norman Mayers.
 “The Economics of Ecosystems and Biodiversity (TEEB)”:
→ It is one global initiative that focuses on drawing attention to economic benefits of biodiversity. It is one global
initiative assessing costs of loss of biodiversity and associated decline in ecosystem services worldwide. It can help
decision-makers recognize, demonstrate and capture values of ecosystem services and biodiversity. It presents
approach that can help decision-makers recognize, demonstrate and capture value of ecosystems and biodiversity.

Page 141 of 719

 → TEEB study was launched by Germany, EU in response to one proposal by G8+5 Environment Ministers in Potsdam,
Germany in 2007, to develop one global study on economics of biodiversity loss.
Question:
 “Biodiversity-related risks are a material risk to economic activity and public finances. Protecting the natural habitat is
not just important for nature’s sake but also crucial for safeguarding macroeconomic stability.”
 With reference to India’s biodiversity, Ceylon frogmouth, Coppersmith Barbet, Gray-chinned minivet, White-throated
redstart are Birds. Ceylon Frogmouth is also known as Sri Lanka frogmouth and is one bird species found in Western
Ghats.
 TEEB is one global initiative that focuses on drawing attention to economic benefits of biodiversity. It presents approach
that can help decision-makers recognize, demonstrate and capture value of ecosystems and biodiversity.
Mains Link:
 How does biodiversity vary in India? How is the Biological Diversity Act, 2002 helpful in the conservation of flora and
fauna? (10M) (UPSC 2018)
 Do you agree that the benefits of biodiversity far exceed the costs of current levels of biodiversity protection? Explain
the impacts of biodiversity on the economic activities of a country. (250 words)

STANDARD MODEL OF PARTICLE PHYSICS

News:
 2022:
→ Researchers announce that they have made precise measurement of mass of so-called W boson.
 Finding: W boson is slightly heavier than that predicted by Standard Model of particle physics. This result is highly
significant because this implies incompleteness of standard model description.
→ World’s most powerful particle collider, Large Hadron Collider (LHC), will begin smashing protons into each
other at unprecedented levels of energy. It is expected to throw up evidence of “new physics” — or physics
beyond Standard Model of Particle Physics, which explains how basic building blocks of matter interact,
governed by 4 fundamental forces. And, one new kind of “pentaquark” and 1 st -ever pair of “tetraquarks”
are found by LHC.
→ Experiments are being done to measure magnetic property of muon in Fermilab (USA).
 Experiment: To resolve conundrum i.e., present measured value of muon’s magnetic strength, or its “magnetic
moment”, which determines its behaviour in magnetic field, is significantly higher than theoretical predictions
of Standard Model of particle physics.
About:
 What:
→ Theory describing 3 of 4 known fundamental forces (electromagnetic, weak and strong interactions, omitting gravity)
in universe and classifying all known elementary particles.
→ It was developed in stages throughout 20th century, through work of many scientists worldwide, with current
formulation being finalized in mid-1970s upon experimental confirmation of existence of quarks. Since then, proof
of top quark (1995), tau neutrino (2000), and Higgs boson (2012) have added further credence to Standard Model.
In addition, Standard Model has predicted various properties of weak neutral currents and W and Z bosons with
great accuracy.
→ Scientists’ current best theory to describe most basic building blocks of universe. It explains how particles called
quarks (which make up protons and neutrons) and leptons (which include electrons) make up all known matter.
→ It explains 3 of 4 fundamental forces that govern universe: electromagnetism, strong force, weak force.
 Why is standard model believed to be incomplete?
→ It gives unified picture of only 3 of 4 fundamental forces of nature. It totally omits gravity.
→ This model does not include description of dark matter particles. So far these have been detected only through their
gravitational pull on surrounding matter.
 W boson, Z boson:
→ What:
 In particle physics, W and Z bosons are vector bosons that are together known as weak bosons or more generally
as intermediate vector bosons. These elementary particles mediate weak interaction; respective symbols are
W+, W−, and Z0. W+ and W- bosons have either +ve or –ve electric charge of 1 elementary charge and are each
other's antiparticles. Z0 boson is electrically neutral and is its own antiparticle. These 3 particles each have spin
of 1. W+ and W- bosons have magnetic moment, but Z0 boson has none. All 3 particles are very short-lived. Their
experimental discovery was pivotal in establishing what is now called Standard Model of particle physics.
→ W Boson:
 discovered in 1983. one fundamental particle. Together with Z boson, it is responsible for weak force. W boson,
which is electrically charged, changes very make-up of particles. It switches protons into neutrons, and vice
versa, through weak force, triggering nuclear fusion and letting stars burn. In contrast to photon, which is
massless, W bosons are quite massive, so weak force they mediate is very short ranged.
 Quark:
→ What:
Page 142 of 719
  It is one type of elementary particle and one fundamental constituent of matter. Quarks combine to form
composite particles called hadrons, most stable of which are protons and neutrons - components of atomic
nuclei. All commonly observable matter is composed of up quarks, down quarks and electrons. Owing to
phenomenon known as color confinement, quarks are never found in isolation; they can be found only within
hadrons, which include baryons (such as protons, neutrons) and mesons, or in quark–gluon plasmas. For this
reason, much of what is known about quarks has been drawn from observations of hadrons.
 Quarks are elementary particles that come in 6 “flavours”: up, down, charm, strange, top, bottom. They usually
combine together in groups of twos and threes to form hadrons such as protons, neutrons that make up atomic
nuclei.
→ Feature:
 Strong force: Interaction of quarks was tied to one of fundamental forces of nature called strong force. This force
not only holds insides of atoms together but is important in interactions of other sub-atomic particles that make
universe tick.
 Quarks can also combine into 4-quark and 5-quark particles, called tetraquarks and pentaquarks.
 Hadrons:
→ Any of subatomic particles (such as protons, neutrons) that are made up of quarks and are subject to strong force.
→ In particle physics, hadron is one composite subatomic particle made of two or more quarks held together by strong
interaction. They are analogous to molecules that are held together by electric force. Most of mass of ordinary matter
comes from two hadrons: proton and neutron, while most of mass of protons and neutrons is in turn due to binding
energy of their constituent quarks, due to strong force.
 Tetraquark:
→ In particle physics, it is one exotic meson composed of 4 valence quarks. Tetraquark state has long been suspected
to be allowed by quantum chromodynamics, modern theory of strong interactions. Tetraquark state is one example
of exotic hadron which lies outside conventional quark model classification. Number of different types of tetraquark
have been observed.
 Pentaquark:
→ One human-made subatomic particle, consisting of 4 quarks and 1 antiquark bound together; they are not known to
occur naturally, or exist outside of experiments specifically carried out to create them.
 Exotic meson:
→ Meson that has quantum numbers not possible in quark model.
 Muon:
→ One elementary particle similar to electron, with electric charge of −1 e and spin of 1/2, but with much greater mass.
It is classified as lepton. As with other leptons, muon is not known to have any sub-structure – that is, it is not thought
to be composed of any simpler particles.
→ Muon, one heavier, unstable cousin of electron, behaves like one tiny bar magnet.
Note:
 Collider:
→ What:
 One type of particle accelerator which brings two opposing particle beams together such that particles
collide. Colliders may either be ring accelerators or linear accelerators.
Colliders are used as research tool in particle physics by accelerating particles to very high
kinetic energy and letting them impact other particles. Analysis of byproducts of these collisions gives
scientists good evidence of structure of subatomic world and laws of nature governing it. These may
become apparent only at high energies and for tiny periods of time, and therefore may be hard or
impossible to study in other ways.
→ Large Hadron Collider (LHC):
 What:
• LHC is world's largest and highest-energy particle collider. It was built by European Organization for Nuclear
Research (CERN) between 1998 and 2008 in collaboration with over 10,000 scientists and hundreds of
universities and laboratories, as well as more than 100 countries. It lies in one tunnel 27 kilometres in
circumference and as deep as 175 metres beneath France–Switzerland border near Geneva.
This collider has 4 crossing points where accelerated particles collide. 7 detectors, each designed to
detect different phenomena, are positioned around crossing points. LHC primarily collides proton beams,
but it can also accelerate beams of heavy ions: lead–lead collisions and proton–lead collisions are typically
performed for 1 month per year.
• LHC is one giant, complex machine built to study particles that are smallest known building blocks of all
things.
 Goal:
• To allow physicists to test predictions of different theories of particle physics, including measuring
properties of Higgs boson searching for large family of new particles predicted by supersymmetric theories,
and other unresolved questions in particle physics.
 Feature:
Page 143 of 719
 • Structure: LHC is one 27-km-long track-loop buried 100m underground on Swiss-French border.
• Operation: In its operational state, it fires 2 beams of protons almost at speed of light in opposite directions
inside one ring of superconducting electromagnets.
• Guided by magnetic field: Magnetic field created by superconducting electromagnets keeps protons in tight
beam and guides them along way as they travel through beam pipes and finally collide.
• High precision: Particles are so tiny that task of making them collide is akin to firing two needles 10 km apart
with such precision that they meet halfway.
• Supercooled: Since LHC’s powerful electromagnets carry almost as much current as one bolt of lightning,
they must be kept chilled. It uses liquid helium to keep its critical components ultracold at minus 271.3
degrees Celsius, which is colder than interstellar space.
• Experiments: ATLAS is largest general-purpose particle detector experiment at LHC. Compact Muon
Solenoid (CMS) experiment is one of largest international scientific collaborations in history, with same goals
as ATLAS, but which uses different magnet-system design.)
 Achievement:
• ‘God Particle’ discovery: Scientists at CERN had announced discovery of Higgs boson or ‘God Particle’ during
LHC’s 1st run. This led to Peter Higgs and his collaborator Francois Englert being awarded Nobel Prize for
physics in 2013.
• ‘New Physics’ beyond Standard Model: After discovery of Higgs boson, scientists have started using data
collected as tool to look beyond Standard Model, which is currently best theory of most elementary building
blocks of universe and their interactions.
 What next?
• New quest: To further understanding of so-called “dark matter” (Dark matter is hard-to-detect, and this
hoped-for particle is believed to make up most of universe, but is completely invisible as it does not absorb,
reflect, or emit light).
Glossary:
 Higgs boson:
→ It is fundamental particle associated with Higgs field, one field that gives mass to other fundamental
particles such as electrons and quarks.
Question:
 Belle II experiment is one particle physics experiment designed to study properties of B mesons and other particles.
Mains Link:
 Enumerate the main goals of the Large Hadron Collider (LHC). How will it help us to understand the evolution of the
universe? (250 words)
 Discuss the significance of the Standard Model of particle physics in understanding the sub-atomic particle and the origin
of the universe. How is it different from Einstein’s theory of relativity? (15M)

CONSUMER PROTECTION
News:
 2021:
→ Under Consumer Protection Act, 2019, Ministry of Consumer Affairs, Food and Public Distribution notifies e-
commerce rules, 2020.
→ Supreme Court tells Centre and States to fill vacancies in Consumer Disputes Redressal Commissions (CDRC).
Supreme Court also asked Centre to conduct comprehensive “legislative impact study” on Consumer Protection Act,
2019.
 2022:
→ In exercise of its powers under Consumer Protection Act, 2019, Central Government notifies Consumer Protection
(Jurisdiction of District Commission, State Commission and National Commission) Rules, 2021.
→ CCI dismisses allegations of predatory pricing against e-commerce platform Shopee (Singapore based).
→ Government calls meeting of restaurant owners over service charges levied by them on customers. Govt. tells
eateries to stop levying service charge, it is illegal (under Consumer Protection Act, 2019).
→ National Restaurant Association of India says Service Charge ban in food bills without any legal basis. NRAI says there
is no illegality in levying service charge.
→ Central Consumer Protection Authority (CCPA) (regulator under Consumer Protection Act, 2019) barred hotels and
restaurants from adding service charges automatically or by default to food bill.
→ CCPA announced 5 guidelines to prevent unfair trade practices and to protect consumer interests regarding levy of
service charges in hotels and restaurants. This CCPA 2022 guidelines note charging for anything other than price
displayed on menu card along with applicable taxes without “express consent” of customer as “unfair trade
practices”. This CCPA 2022 guidelines are in addition to Centre’s 2017 guidelines which prohibit levy of service
charges on consumers by hotels and restaurants.
About:
 Consumer Protection Act, 2019:
→ What:
Page 144 of 719
  It replaces earlier consumer law - Consumer Protection Act, 1986
→ Provisions:
 Definition of consumer:
• Consumer is defined as person who buys any good or avails service.
• Covers transactions through all modes: Offline; online through electronic means (electronically) [E-
Daakhil Portal]; teleshopping; multi-level marketing; direct selling etc.
• Not consumer: Person who obtains good for resale or who obtains good / se rvice for commercial
purpose.
 Coverage:
• Goods, services.
 Consumer rights:
• Right to be informed. Right to choose. Right to safety. Right to seek redressal. Right to be heard.
Right to consumer education.
 Central Consumer Protection Authority (CCPA) [2019]:
• What:
 One regulatory authority set up under Consumer Protection Act, 2019 in relation to matters affecting
rights of consumers by individuals or entities following improper trade practices or by display of
inappropriate or wrong advertisements affecting public interest and helps promoting consumer trust
by enforcing rights of consumers through effective guidelines.
• Aim:
 promote, protect and enforce rights of consumers.
• Duty:
 CCPA has authority to protect, promote and most importantly enforce rights of consumers and prevent
violation of their rights. It regulates matters related to violation of consumer rights; unfair trade
practices; misleading advertisements.
 Impose penalty on manufacturers / advertisement endorsers if found guilty.
 It also seeks to ensure that no person is engaged in unfair trade practices.
 It is also empowered to issue guidelines to enforce rights of consumers laid down in 2019 Act.
 Consumer Disputes Redressal Commission (CDRC):
• Consumer can file complaint with CDRCs to be set up at: district commission (headed by sitting /
retired / eligible to be appointed as District Judge); State commission (headed by sitting / retired
High Court); national commission. That is, 3-tier structure.
• Pecuniary Jurisdictions of CDRCs have been increased.
• quasi- judicial bodies.
 Appeals:
• Appeal against District CDRC order can be filed in State CDRC and then to National CDRC.
• Final appeal lies before Supreme Court.
 Mediation:
• CDRCs can refer matter to mediators for early settement if both parties agree.
• But, no appeal against settlement via mediation.
 E-commerce:
• E-commerece are brought under ambit of this 2019 Act.
 Disposal Time period:
• complaint shall be disposed of within 3 months or within 5 months if complaint requir es analysis or
testing of commodities.
 Product Liability:
• Manufacturer / product service provider / product seller will be held responsible, to compensate,
for injury / damage caused by defective product / deficiency in services.
→ Supreme Court observations:
 In 2021, Supreme Court expressed concerns that Consumer Protection Act, 2019 is made for benefit of
people. But, States are defeating purpose for which consumer protection laws are made. Supreme Court
questioned if governments, both at Centre and in States, had deliberately kept vacancies in CDRC pending to
dissuade people from filing complaints.
→ Redressal for protection of consumer rights:
 Consumer Protection Act, 2019 provides 3-tier quasi-judicial mechanism for redressal of consumer
disputes - district commissions, State commissions, national commission.
 Consumer Protection Act, 2019 provides pecuniary jurisdiction of each tier of consumer commissions.
 Consumer Protection Act, 2019 provides consumers option of filing complaint electronically . For this,
central government has set up E-Daakhil Portal.
 Consumer Protection Act, 2019 provides for refering consumer disputes to Mediation, with consent of
both parties, so as to provide faster and amicable consumer disputes settlement.
Page 145 of 719
 Consumer Protection (E-Commerce) Rules, 2020:
→ Objective:
 Regulation of all commercial transactions sold over digital / electronic network.
→ mandatory (not advisory)
→ recognises below e-commerce business models:
 marketplace model.
 inventory-based model.
→ Provisions for e-commerce firms (To enable consumers make informed decision):
 Mandatory display of ‘country of origin’ on products
 Display total price of goods & services offered for sale.
 Mention expiry date of goods offered for sale.
 Specify details about return, refund, exchange, warranty, guarantee, delivery, shipment.
 No manipulation of prices for unreasonable profit.
 No cancellation charges.
 Provide information on available payment methods.
 Information about sellers offering goods and services.
 Violation will atract penal action under Consumer Protection Act, 2019.
→ Criticism:
 Grey areas:
• definition of what constitutes unfair trade practice. Definition of drip pricing.
 Consumer Protection (Jurisdiction of District Commission, State Commission, National Commission) Rules, 2021:
→ What:
 It revises pecuniary jurisdiction for entertaining consumer complaints.
→ Overview:
 Food and Public Distribution, district commissions will have jurisdiction to entertain complaints where value of
goods or services <= 50 lakh.
 State commissions can look onto complaints of 50 lakh – 2 crores.
 National Commission will have jurisdiction to entertain complaints where value of goods or services > 2 crores.
 CCPA 2022 Guidelines (Guidelines to prevent unfair trade practices and protection of consumer interest with regard to
levy of service charge in hotels and restaurants):
→ 5 Guidelines:
 (i) No hotel or restaurant shall add service charge automatically or by default in bill.
 (ii) Service charge shall not be collected from consumers by any other name.
 (iii) No hotel or restaurant shall force consumer to pay service charge and shall clearly inform consumer that
service charge is voluntary, optional and at consumer's discretion.
 (iv) No restriction on entry or provision of services based on collection of service charge shall be imposed on
consumers.
 (v) Service charge shall not be collected by adding it along with food bill and levying GST on total amount.
→ What it means?
 Prohibition from levying extra charges: Hotels or restaurants are prohibited from levying extra charges
automatically or by default in bill or by any other name.
 No forced service charges: Also, they are not allowed to force service charges, and must clearly inform
consumers that service charges are voluntary, optional, and at their discretion.
 No restriction on entry based on service charges: Hotels and restaurants are no longer allowed to restrict entry
or services based on collection of service charges.
 No addition of service charges and GST on total: Hotels cannot add service charges to their bills and charge GST
on total.
 Tips or donations no longer permitted: Any tip, donation, token, gratuity, etc. is no longer permitted to be
charged and shall be considered as separate transaction between consumer and staff of hotel and restaurant. It
is entirely up to consumer to decide whether or not to tip. If consumer enters restaurant or orders something,
restaurant policy cannot require them to tip.
 Unfair trade practice: Guidelines now consider charging customer other than price of food items displayed on
menu along with applicable taxes, as unfair trade practice under CPA, 2019.
→ Redressal mechanism:
 If any consumer finds that hotel or restaurant is levying service charge in violation to above-mentioned
guidelines, consumer may:
• (i) Make request to concerned hotel or restaurant to remove service charge from bill amount.
• (ii) Lodge complaint on National Consumer Helpline (NCH), which works as alternate dispute redressal
mechanism at pre-litigation level by calling 1915 or through NCH mobile app.
• (iii) File complaint against unfair trade practice with Consumer Commission. Complaint can also be filed
electronically through edaakhil portal (www.edaakhil.nic.in) for its speedy and effective redressal.
Page 146 of 719
 • (iv) Submit complaint to District Collector of concerned district for investigation and subsequent proceeding
by CCPA. Complaint may also be sent to CCPA by e-mail at com-ccpa@nic.in.
Note:
 Service Charge:
→ What:
 Fee collected to pay for services related to primary product or service being purchased. This charge is usually
added at time of transaction.
 It is fee collected to pay for services associated with purchase of primary product or service.
 Service charge is one tip or one direct transaction between customer and restaurant staff, specifically wait staff.
 It is collected by hospitality sectors and food and beverage industries as fee for serving customers.
→ Feature:
 Many industries collect service charges, including restaurants, banking, travel and tourism. When collected,
these charges may cover services rendered to consumer, or they may cover administrative or processing costs.
 Service charges are paid directly to company. They are different from tips, which are paid to employee who
renders service. Paying tip and tip amount is wholly up to customer.
 In India, collection of service charge by hotels is voluntary and at discretion of consumers and not mandatory as
per law.
→ Status:
 Service charge was made voluntary in 2017.
→ Argument:
 According to National Restaurant Association of India (NRAI) officials:
• It is legal for restaurants to levy service charge and does not violate Consumer Protection Act, if it is
mentioned in menu / price list and informed to customer.
• Service Charge directly benefits about 6 million people employed in industry.
• More than 60% of employees depend on service charge to augment their income.
• Food and Beverage operators employ service charge method to ensure that all employees benefit from
restaurant’s success.

Consumer Protection Act, 1986 Consumer Protection Act, 2019
Regulator No provision. CCPA
Consumer court Complaint could be filed in consumer court Complain can be filed in consumer
where seller’s (defendant) office is located. court where complainant resides /
works.
Product liability No provison. Consumer can seek compensation for
Consumer could approach civil court, but harm caused by product / service.
not consumer court.
Pecuniary (Money) District:up to Rs. 20 lakh District: up to Rs. 1 crore
jurisdiction State: Rs. 20 lakh to Rs. 1 crore State: Rs. 1 crore to Rs. 10 crores
National: above Rs. 1 crore National: above Rs. 10 crores
E-commerce No provision All rules of direct selling extended to
e-commerce.
Mediation cells No provision Court can refer settlement through
mediation.
Mains Link:
 The new Consumer Protection Act (CPA) has come into operation replacing the earlier law, which was over three decades
old. What are the fundamental differences between the two Acts and will the new law serve the expectations of the
consumer better than its predecessor? Explain.
 Write a note on consumer dispute redressal mechanism under the Consumer Protection Act of 1986.

DARK ENERGY, DARK MATTER

News:
 2021:
→ With help of XENON1T experiment, international team of researchers made considered to be 1st direct
detection of dark energy.
 2022:
→ Astronomical observations suggest that significant part of universe is made up of dark matter.
→ One of most sensitive dark matter detector experiments named LUX-ZEPLIN (LZ) experiment in USA was in
news.
About:
 Background:

Page 147 of 719

 → All interactions in universe are result of 4 fundamental forces acting on particles — strong nuclear force,
weak nuclear force, electromagnetic force, gravitation. Composition of Universe: Ordinary matter (4.9%),
Dark Matter (26.8%), Dark Energy (68.3%).
 Dark Energy:
→ What:
 In physical cosmology and astronomy, dark energy is unknown form of energy that affects universe on largest
scales.
 hypothetical form of energy that exerts negative, repulsive pressure, behaving like opposite of gravity.
→ Feature:
 We know how much dark energy there is because we know how it affects universe’s expansion. Other than that,
it is complete mystery. But it is important mystery. It makes up about 70% of universe.
 1st observational evidence for its existence came from measurements of supernovae, which showed that
universe does not expand at constant rate, rather, universe's expansion is accelerating.
 Before, scientists thought that all forms of matter and energy in universe would only cause expansion to slow
down over time. Measurements of cosmic microwave background (CMB) suggest universe began in hot Big Bang,
from which general relativity explains its evolution and subsequent large-scale motion. Without introducing new
form of energy, there was no way to explain how scientists could measure accelerating universe. Since 1990s,
dark energy has been most accepted proposition to account for accelerated expansion.
 It makes up about 70% of universe.
 hypothetical form of energy that exerts negative, repulsive pressure, behaving like opposite of gravity.
→ Impact:
 It is causing rate of expansion of our universe to accelerate over time, rather than to slow down. That’s contrary
to what one might expect from universe that began in Big Bang.
→ Fact:
 Single largest constituent of Universe. It tends to drive Universe apart. It has no interaction with Normal matter.
It can be thought as 5th Fundamental force.
 Dark Matter
→ What:
 One hypothetical form of matter thought to account for approximately 85% of matter in universe. Dark matter
is called "dark" because it does not appear to interact with electromagnetic field, which means it does not
absorb, reflect, or emit electromagnetic radiation (like light) and is, therefore, difficult to detect.
 Dark matters are particles that do not have charge — which means they do not interact through electromagnetic
interactions. “Dark”: because they do not emit light. “Matter”: because they possess mass like normal matter
and hence interact through gravity.
→ Composition:
 No definite answer of what Dark matter particles are made up of. But scientists say ‘neutrino’ would have been
one excellent candidate if it had been more massive, but being too light, it does not fit bill. Other postulated
entities include supersymmetric partner of Z boson, one particle that mediates electro-weak interaction.
→ Feature:
 Good fraction of universe consists of dark matter.
 It interacts with rest of universe only through gravitational pull.
 Many astrophysical observations — including gravitational effects - cannot be explained by currently accepted
theories of gravity unless more matter is present than can be seen. This imply dark matter's presence. For this
reason, most experts think that dark matter is abundant in universe and has had strong influence on Universe’s
structure and evolution.
 Dark matter is elusive because gravitational force is extremely weak. Particle that interacts so weakly becomes
rather elusive to detect.
→ Evidence for Dark Matter:
 By observing rotation of galaxies: There are discrepancy changes in how stars revolve around galaxy centre than
what should be ideal path. This is believed to be because of presence of dark matter along path.
 By observations of Bullet Cluster of galaxies: Bullet Cluster is formed through merging of two galaxy clusters.
This merger didn’t take place as per observable calculations, signifying presence of another massive matter
particle - ‘dark matter’.
→ Challenge:
 Many large lab experiments have tried to detect elementary particles that could be candidates for dark matter.
However, such dark matter particles have not been detected until now.
→ Significance:
 If dark matter is made of black holes, then they will interact with gravitational waves passing in their vicinity.
 Researchers use non-observation of Gravitational lensing signatures to assess what fraction of dark matter could
be made of black holes.
→ Fact:

Page 148 of 719

  2nd largest constituent of Universe. It tends to drive Universe together. It interacts with Normal matter by Gravity
(Gravitational Lensing). It is neither Antimatter nor Black Hole.
 Dark energy vs dark matter:
→
{Dark Energy} {Dark Matter} {Atom}
about 70% of universe about 25% of universe about 5% of universe
repels and causes expansion of attracts and holds galaxies Everything we see – planets,
our universe together. moons, massive galaxies etc.
Note:
 XENON experiment:
→ XENON dark matter research project, operated at Gran Sasso National Laboratory in Italy, is one deep
underground research facility featuring increasingly ambitious experiments aiming to detect dark matter
particles. These experiments aim to detect particles in form of Weakly Interacting Massive Particles
(WIMPs) by looking for rare interactions via nuclear recoils in one liquid xenon target chamber.
→ XENON1T experiment:
 Construction of next phase, XENON1T, started in Gran Sasso National Laboratory, Italy in 2014. It is world’s most
sensitive dark matter experiment. It is operated deep underground in Italy. It uses dual-phase (liquid / gas) xenon
technique.
 Black hole, gravitational wave, dark matter, gravitational microlensing:
→ When gravitational wave approaching earth is interrupted by presence of black hole (acting as gravitational
lens), said gravitational wave signal get modified. This effect will change shape of gravitational wave signals
that are received on earth. Scientists can then use received gravitational wave signals to confirm presence
of black hole.
 LUX-ZEPLIN (LZ) Experiment / LZ experiment [2012]:
→ What:
 It is one next-generation dark matter direct detection experiment hoping to observe Weakly
Interacting Massive Particles (WIMP) scatters on nuclei. It was formed in 2012 by combining LUX and
ZEPLIN groups. It is currently one collaboration of 30 institutes in US, UK, Portugal, Russia. This
experiment is located at Sanford Underground Research Facility (SURF) in South Dakota , USA.
→ Feature:
 This experiment uses one ultra-sensitive detector made of 10 tons of liquid xenon to hunt for signals
of WIMP-nucleus interactions. It is one of 3 such experiments which lead search for direct detection
of WIMPs, other two being XENON / XENONnT experiment and PANDAX-4T experiment.

SPACE OBJECT / OBJECT IN SPACE / OBJECTS IN SPACE

News:
 2020:
→ NASA finds that 16 Psyche / Golden Asteroid could be made entirely of metal worth more than entire
economy of planet Earth.
 2021:
→ Debris from China’s Long March rocket fell into Indian Ocean near Maldives.
 Long March rocket, China: It was carrying Tianhe component for China’s space station Tiangong. China’s
space station will be only 2nd space station after ISS.
→ Annual Leonids Meteor Shower begins.
→ Researchers say Earth may soon get Saturn-like rings made entirely out of space junk. But, they also say
that these space junk can be cleaned up using magnets.
→ OSIRIS-REx spacecraft briefly touched asteroid Bennu, from where it collected samples of dust and pebbles.
And, OSIRIS-REx spacecraft departs asteroid Bennu, and start its journey back to Earth.
→ NASA announces launch of ‘Lucy’ mission.
→ NASA launches DART mission.
→ Russia blows up one of its old satellites in missile test, sparking international anger because of space debris
it scattered around Earth’s orbit.
 2022:
→ One Chinese satellite had near collision with chunks of debris left by fallout of said Russian anti -satellite
missile test.
→ OSIRIS-REx is bringing back asteroid sample [from one site (named Nightingale) located in its northern
hemispehere]. It will arrive to earth in 2023.
→ Astronomers at Las Vegas (USA) observed one star which appeared to briefly blink out because asteroid
Eurybates (Eurybates asteroid is one of handful of asteroids that Lucy will visit over in next 12 years).
→ NASA’s Lucy mission — set to explore group of asteroids that follow behind and in front of Jupiter’s orbit
— hit obstacle when one of its solar arrays failed to unfurl.

Page 149 of 719

 → Lyric Meteor showers peaked in Indian skies on April 22nd and will continuously pass through till April 29
at nearly 10-15 meteors every hour.
→ Space Debris from re-entry of Long March 3B / Chang Zheng 3B — China’s orbital launch vehicle, is
suspected to have fallen at various places in Gujarat (India).
→ NASA delays Psyche mission (part of NASA’s Discovery Program) to asteroid.
→ ISRO launches world’s 1 st facility to track space debris, and safeguard assets - ISRO System for Safe and
Sustainable Space Operations & Management (IS4OM).
→ In 1 st -of-its kind, “save-world experiment”, NASA is about to hit small, harmless asteroid millions of miles
away. One spacecraft named DART will zero in on that asteroid (one small moonlet called Dimorphos),
intent on slamming it head-on at 22,500 kph. [Purpose: Impact should be just enough to nudge that
asteroid into slightly tighter orbit around its companion space rock — demonstrating that if killer asteroid
ever heads our way, we’d stand fighting chance of diverting it].
About:
 Forms:
→ Comet:
 Rocky and icy object
 originates from outer solar system
 Due to sunlight, its ice vaporizes and forms atmosphere (coma) of dust and gas, sometimes tail of dust,
gas etc.
→ Asteroid:
 Inactive rocky body orbiting Sun, generally between Mars and Jupiter.
 Sometimes, it gets bounced towards Earth.
→ Meteoroid:
 rocky and icy objects ejected from comets, asteroid while orbiting Sun.
→ Meteor:
 What:
• Meteoroid, space rock that enters Earth’s atmosphere.
• light phenomena occurs when it vaporizes due to Earth’s atmosphere.
• also called shooting star or falling star or meteor shower.
 Type:
• Geminid meteor: Origins not from comet but from asteroid or extinct comet.
→ Meteorite:
 Meteor that lands on Earth’s surface after surviving through Earth’s atmosphere i.e. meteor that is not
burnt up entirely in Earth’s atmosphere.
 Space Debris / Space junk / Space pollution / Space waste / Space trash / Space garbage:
→ What:
 defunct artificial objects in space — principally in Earth orbit — which no longer serve useful function.
 numerous in Earth orbit
→ Example:
 derelict/nonfunctional spacecraft, abandoned launch vehicle stages, mission -related debris,
fragmentation debris from breakup of derelict rocket bodies and spacecraft, solidified liquids expelled
from spacecraft, unburned particles from solid rocket motors.
 Space debris can include natural space debris such as meteoroids, or man -made ones which can include
defunct spacecrafts and satellites, stages of rockets which have launched payloads, dead satellites,
satellite explosions and collisions.
→ Amount of space debris in space:
 About known 1 million pieces. They all travel at speeds of up to 28,162 kmph fast enough for relatively
small piece of orbital debris to damage satellite or spacecraft.
→ Concern:
 Ever-growing space object population and risk of collisions in space. Rising concern about Kessler
Syndrome.
 Space debris represents risk to spacecraft.
 More countries are venturing into space. Thus, space debris problem is simply ballooning out of
control. Recent 2021 anti-satellite weapons (ASAT) test by Russia etc. are only worsening debris
problem.
 major risk to International Space Station (ISS), satellites in geostationary orbit.
 potential threat to lives of US, Russian, Chinese astronauts / cosmonauts currently in space.
 global threat to continued use of space-based technologies that support critical functions -
communication, transport, weather, climate monitoring, remote sensing.
 Space debris orbiting earth, travel at such high speed that even small debris can cause high damage
to satellite, spacecraft.
Page 150 of 719
  The re-entry of the rocket, described by astrophysicists as the fourth-largest uncontrolled reentry in
history, had evoked concerns in recent days about possible damage should it have fallen on land.
 It had been criticised by the National Aeronautics and Space Administration (NASA) in the U.S. for
“failing to meet responsible standards”.
 Few expected the debris to harm humans, mainly due to most of it burning up in the atmosphere, as
well as the fact that large parts of the Earth are covered by oceans and massive land areas lie
uninhabited.
 Without active debris removal, certain orbits will become unusabl e over coming decades.
→ Tackle space debris:
 Only few countries – USA, Europe, Russia, India - have facility / ability to track space debris and share
collision warnings.
 Technology should be used to move object out of way by altering its orbit so as to avoid potential
crash.
 Technologies like moving objects with powerful laser beam.
 NASA: Space Debris Sensor (SDS) of NASA orbits Earth on International Space Station (ISS). It will detect
millimetre-sized pieces of debris, and provide it is of space or man -made space debris.
 REMOVEdebris: satellite research project intending to demonstrate various space debris removal
technologies.
 e.Deorbit: It is planned active space debris removal mission of European Space Agency (ESA).
 Other technologies include moving objects with powerful laser beam. It is important to start doing this soon,
because current scientific estimates predict that without active debris removal, certain orbits will become
unusable over coming decades.
 India:
• Netra:
 What: Space Situational Awareness (SSA) Control Centre set up by ISRO in Bengaluru.
 Aim: To safeguard ISRO’s space assets from space debris; monitor, track and protect national space
assets.
• ISRO System for Safe and Sustainable Space Operations & Management (IS4OM) [2022]:
 World’s 1 st facility to track space debris launched by ISRO in 2022.
 IS4OM is ISRO’s holistic approach to ensure safety of space assets and sustaining utilization of
outer space for national development.
 It will undertake observation and monitoring of spac e objects and space environment,
processing observations for orbit determination, object characterization and cataloguing,
analysis of space environment evolution, risk assessment, and mitigation, and data exchange
and collaboration.
→ Way Forward:
 “Spacefaring nations” should “minimise the risks to people and property on Earth of re-entries of space objects
and maximise transparency regarding those operations.
 Predicting collision probability.
 Sheer amount of debris requires constant observation and prediction.
Note:
 Asteroid:
→ What:
 minor planet of inner Solar System and are metallic or rocky bodies without atmospheres.
 Size and shapes of asteroids vary significantly.
→ Categories:
 Main Asteroid Belt:
• Asteroids found in main asteroid belt, between Mars and Jupiter, about 1.1-1.9 million asteroids.
 Trojans:
• asteroids that share orbit with larger plane
• NASA reports presence of Jupiter trojans, Neptune trojans, Mars trojans.
• Earth has 2 Earth trojans.
• Jupiter asteroids are swarmed around Jupiter.
 Near-Earth Asteroids (NEA):
• NEAs orbit close to Earth.
• Asteroids that cross Earth’s orbit are called Earth-crossers.
• More than 10,000 Earth crossers are known, of which about 1,400 are classified as potentially hazardous
asteroids (PHAs).
→ Potentially Hazardous Asteroid (PHA):
 According to NASA, PHAs are asteroids that can potentially threaten earth with close approaches to Earth.
 In asteroid belt between Mars and Jupiter, about 1000 asteroids are classified as PHAs.
Page 151 of 719
  All asteroids with Minimum Orbit Intersection Distance (MOID) of 0.05 au or less.
→ Example:
 Bennu:
• ancient asteroid (billions of years)
• in solar system
• discovered by Lincoln Near-Earth Asteroid Research team (NASA-funded) in 1999.
• formed in 1st 10 million years of solar system’s formation [it means it is roughly 4.5 billion years old].
• B-type asteroid (i.e. contains significant carbon, other minerals).
• Because of its high carbon content, it reflects low amount of sunlight.
• It passes through: space between Earth and Mars; and space between Earth and Venus.
• Why study asteroid Bennu:
 Bennu is ancient asteroid, billions of years old, that has not gone composition-altering change.
 Because of its age, Bennu is likely to contain material that contains molecules present when life 1st
formed on Earth.
 It implies that chemicals, rocks from birth of solar system lie below Bennu’s surface.
 Therefore, Bennu asteroid may give clues about origins of solar system, Sun, Earth, other planets.
 Bennu is classified as Near Earth Object (NEO). It might strike Earth in next century.
 Jupiter Trojans / Trojan Asteroids / Trojans:
• large group of asteroids that share Jupiter's orbit around Sun.
• believed to be remnants of early solar system
• believed to be formed from same material that led to formation of planets nearly 4 billion years ago when
solar system was formed.
• Significance: Studying them will help scientists understand solar system’ origins and evolution.
→ Asteroid Mission / Asteroids Mission / Mission to Asteroid / Missions to Asteroid:
 In 2026, NASA will launch one census-taking telescope to identify hard-to-find asteroids that could pose risks.
 Near-Earth Asteroid (NEA) Scout [2022]:
• What:
 small spacecraft.
 to fly by and collect data from near-Earth asteroid.
 NASA’s 1st interplanetary mission using solar sail propulsion.
• Significance:
 It will capture images of near-Earth asteroid, to study about NEA.
 develop strategies for reducing potential damage that may be caused by NEA in event of
impact.
 OSIRIS-Rex [2016]:
• What:
 Origins, Spectral Interpretation, Resource Identification, Security, Regolith Explorer
 asteroid-study and sample-return mission.
 NASA
 NASA’s 1st mission to visit near-Earth asteroid (Bennu), survey its surface and collect sample
from it.
• Goal:
 Bring asteroid sample.
• Significance:
 scientists may decipher origin of Earth’s water and life.
 Sample collected could help us learn about origins of our solar system.
 Lucy Mission [2021]:
• What:
 NASA’s 1st mission to explore Jupiter Trojan asteroids.
 spacecraft will fly by Earth twice in order to use Earth’s gravitational field to assist it on its
journey to Trojan asteroids.
 solar-powered mission.
 Life line is about 12 years long.
 named after ‘Lucy’, 3.2 million-year-old ancestor who belonged to species of hominins (which
include humans and their ancestors).
• Objective:
 to deepen understanding of solar system – origins, evolution
 to understand composition of Trojan asteroids
 to determine mass and densities of materials that make up Trojan asteroids
 to look for and study satellites and rings that may orbit Trojan asteroids.
 Dart Mission [2021]:

Page 152 of 719

 • What:
 Double Asteroid Redirection Test
 spacecraft
 1st planetary defense test mission against near -Earth objects (NEO).
• Aim:
 Test newly developed technology to crash space probe int o asteroid and change its course.
• Target asteroid:
 Target of DART is small moonlet - Dimorphos. Dimorphos asteroid orbits one larger asteroid
(Didymos).
• Plan:
 DART spacecraft will navigate to Dimorphos moonlet and intentionally collide (expected to take place
in later half of 2022) with it at high speed.
• Feature:
 It carries high-resolution imager - Didymos Reconnaissance and Asteroid Camera for Optical Navigation
(DRACO).
 It carries small satellite / CubeSat - Light Italian CubeSat for Imaging of Asteroids (LICIACube).
• Significance:
 Images from DRACO will be sent to Earth in real-time and will help study impact site and surface of
Dimorphos.
 LICIACube will capture images of impact and impact crater formed as result of collision. It can also
capture images of any dust cloud formed during impact.
 Tianwen-2:
• One planned Chinese asteroid sample-return and comet exploration mission that is currently under
development.
 Hayabusa2:
• Hayabusa2 is asteroid sample-return mission operated by JAXA.
 Psyche (spacecraft) [NASA]:
• One planned orbiter mission that will explore origin of planetary cores by studying metallic asteroid of same
name (metal-rich asteroid between Mars and Jupiter).
→ Study / Significance:
 To look for information about formation and history of planets and sun because asteroids were formed at same
time as other objects in solar system.
 To look for asteroids that might be potentially hazardous.
 Coma:
→ atmosphere of gas and dust created when comet releases its outer layer from its icy surface.
→ Sometimes, it leads to formation of bright tail of debris.
 Meteor shower / Shooting Star / Falling Star:
→ celestial event in which number of meteors are observed to radiate, or originat e, from one point in night
sky.
→ These meteors are caused by streams of cosmic debris (meteoroids) entering Earth's atmosphere at
extremely high speeds on parallel trajectories.
→ Meteor showers are witnessed when Earth passes through trail of debris left beh ind by comet or asteroid.
→ Most meteors are smaller than grain of sand, so almost all of them disintegrate and never hit Earth's
surface.
→ It is called shooting star because of light in Meteor shower which is result of friction between meteor and
molecules present in Earth’s atmosphere because of which it burns.
 Meteor outbursts / Meteor storms:
→ Very intense or unusual meteor showers
→ It produces atleast 1,000 meteors in 1 hour
→ It is produced most notably from Leonids.
 Leonids:
→ meteor showers associated with comet Tempel–Tuttle in constellation Leo.
→ This spectacular meteor storms occur about every 33 years.
→ Leonids get their name from location of their radiant in constellation Leo (meteors appear to radiate from
that point in sky).
→ They peak in November.
→ major shower that features fastest meteors.
→ Every 33 years, Leonid meteor shower turns into Leonid meteor storm.
 Lyrid / April Lyrid:

Page 153 of 719

 → Lyrids are debris of Comet Thatcher, which is currently traveling at distance millions of kil ometers away
from Earth and currently traveling away from Sun, Comet Thatcher will begin its return trajectory in
another 45 years.
→ meteor shower lasting from April 16 to April 25 each year.
→ Radiant of this meteor shower is located in constellation Lyra, n ear its brightest star, Vega.
→ Peak of this shower is typically around April 22 each year.
→ Source of this meteor shower are particles of dust shed by long -period Comet C/1861 G1 Thatcher.
→ April Lyrids are strongest annual shower of meteors from debris of lo ng-period comet, mainly because as
far as other intermediate long-period comets go (200–10,000 years), this one has relatively short orbital
period of about 415 years.
 Anti-satellite weapons (ASAT):
→ space weapons designed to incapacitate or destroy satellites for strategic or tacticalpurposes.
→ Many nations possess operational ASAT systems.
→ No ASAT system has yet been utilised in warfare
→ Some countries - China, India, Russia, United States - successfully shot down their own satellites to
demonstrate their ASAT capabilities.
→ ASATs have also been used to remove decommissioned satellites.
→ India:
 Mission Shakti [2019]:
• joint programme of DRDO, ISRO.
• entire effort is indigenous
• As part of Mission Shakti, one anti-satellite (A-SAT) weapon was launched and targeted one
decommissioned Indian satellite.
• Significance:
 India is only 4th country to acquire such specialised and modern capability
 Only US, Russia, China, India have ASAT capability to hit live target in space.
 Eurybates Asteroid:
→ carbonaceous Jupiter trojan (asteroid).
→ one of handful of asteroids that Lucy will visit over in next 12 years.
→ In 2022, astronomers at Las Vegas (USA0 observed one star which appeared to briefly blink out because
this asteroid Eurybates had passed in front of it. As Eurybates eclipsed that star, phenomenon scientists
call “occultation” kilometers wide shadow size of asteroid passed over region.
 16 Psyche / Golden Asteroid:
→ One asteroid that orbits between Mars and Jupiter in asteroid belt. One large M-type asteroid discovered
by Italian astronomer Annibale de Gasparis, in 1852 and named after Greek mythological figure Psyche.
Prefix "16" signifies that it was 16 th minor planet in order of discovery. It is largest and most massive of M-
type asteroids, and one of dozen most massive asteroids.
→ may mostly comprise of iron and nickel - similar to Earth’s core.
→ may contain gold, platinum also.
→ formed by violent collisions of planets.
→ It is unique is that it appears to be exposed nickel-iron core of one early planet, one of building blocks of
our solar system.
 Long March 3B (LM-3B) / Chang Zheng 3B (CZ-3B):
→ China’s orbital launch vehicle, similar to India’s GSLV or PSLV.
→ Its 3 rd stage, which releases satellite at required orbit following which it re mains in sub-orbital flight,
remains outside purview of being controlled by human intervention and ultimately re -enters earth. It is
this 3 rd stage that is now suspected to have re-entered earth, leading to debris falling in Gujarat.
 Occultation:
→ occults means view
→ event that occurs when one object is hidden by another object that passes between it and observer.
→ In astronomy, if closer body does not entirely conceal farther body, event is called transit. Both transit and
occultation may be referred to generally as occlusion; and if shadow is cast onto observer, it is called
eclipse.
→ In astronomy, occultation is any event where one celestial object passes in front of another celestial object,
blocking latter celestial object from observer’s view.
→ Example - solar eclipse, which occurs when Moon passes between Sun and Earth, blocking Sun from our
view.
 Kessler Syndrome / Kessler effect / Collisional cascading / Ablation cascade :
→ What:
 It was proposed by NASA scientist Donald J. Kessler in 1978, and is one scenario in which density of
objects in LEO due to space pollution is high enough that collisions between ob jects could cause
Page 154 of 719
 cascade in which each collision generates space debris that increases likelihood of further collisions.
In 2009 Kessler wrote that modeling results had concluded that debris environment was already
unstable, such that any attempt to achieve growth-free small debris environment by eliminating
sources of past debris will likely fail because fragments from future collisions will be generated faster
than atmospheric drag will remove them.
 It means collision in space due to pollution could increase number of space debris, increasing number
of potential collisions due to multiplying space debris.
→ Implication:
 Distribution of debris in orbit could render space activities and use of satellites in specific orbital
ranges difficult for many generations.
Mains Link:
 Discuss the objectives of OSIRIS- REx.
 Discuss the concerns associated with Space Debris.

INTERNET EXCHANGE (IX) / INTERNET EXCHANGE POINT (IXP)

News:
 2021:
→ Along with Ministry of Electronics & Information Technology (MeitY), NIXI will play supporting role for IPv6 awareness
and its adoption in country.
→ NIXI announces to offer Free Domain (IDN) in local Indian languages.
 2022:
→ NIXI establishes 2 new Internet exchange points (IXP) in West Bengal.
About:
 What:
→ Internet exchange points are common grounds of IP networking, allowing participant Internet Service Providers (ISPs)
to exchange data destined for their respective networks. IXPs are generally located at places with preexisting
connections to multiple distinct networks, i.e., datacenters, and operate physical infrastructure (switches) to connect
their participants. Organizationally, most IXPs are each independent not-for-profit associations of their constituent
participating networks (that is, set of ISPs which participate at that IXP). Primary alternative to IXPs is private peering,
where ISPs directly connect their networks to each other.
→ IXP is one physical location through which Internet infrastructure companies such as Internet Service Providers (ISPs)
and Content Delivery Networks (CDN) connect with each other.
 Initiative:
→ National Internet Exchange of India (NIXI) [2003].
→ Indian Registry for Internet Names and Numbers (IRINN) [2012].
 Significance:
→ IXPs reduce portion of ISP's traffic that must be delivered via their upstream transit providers, and thereby reducing
average per-bit delivery cost of their service.
→ Increased number of paths available through IXP improves routing efficiency (by allowing routers to select shorter
paths) and fault-tolerance.
→ IXPs exhibit characteristics of network effect.
Note:
 National Internet Exchange of India (NIXI) [2003]:
→ What:
 not-for-profit org. registered under Indian Companies Act, 2013. NIXI works for exchange of domestic internet
traffic between ISP members, and allocates Internet protocol addresses (IPv4, IPv6).
 It was setup for peering of ISPs among themselves for purpose of routing domestic traffic within India so as to
achieve:
• reduced bandwidth charges for ISPs by saving on international bandwidth; and
• better quality of service (reduced latency) for ISPs.
→ Aim:
 Improvement of internet services in country.
 Spread internet infrastructure, technology to citizens of India.
→ Function:
 offers Internationalized Domain Name (IDN)
→ Methods:
 Internet Exchanges:
• through which internet data is exchanged amongst ISP’s, Data Centers.
 ‘.IN’ Registry:
• managing and operating ‘.IN’ country code domain; and
• ‘.BHARAT’ (in hindi) Internet domain name (IDN) domain for India.

Page 155 of 719

  Indian Registry for Internet Names and Numbers (IRINN) [2012].
 Indian Registry for Internet Names and Numbers (IRINN) [2012]:
→ What:
 National Internet Registry in India. One affiliation-based organisation functioning under NIXI.
→ Function:
 Coordinating and allocating Internet protocol (IPv4 / IPv6) addresses.
 Coordinating IP address allocation with other Internet resource management function at national level in the
country

TEXTILE
News:
 2020:
→ National Rural Infrastructure Development Agency (NRIDA) announces that Coir Geo Textiles will be used
for construction of rural roads under Pradhan Mantri Gram Sadak Yojana (PMGSY-III).
 2021:
→ Govt. to set up National Technical Textiles Mission (NTTM).
→ Following Union Budget 2021-22 commitment, government will set up some PM MITRA textile parks.
→ Centre targets many times’ increase in export of technical textiles in coming years.
 2022:
→ Central government wants to create 75 textile hubs across India on lines of Tiruppur (one TN city that
produces textile garments giving employment) to generate jobs and support higher textile exports.
→ Minister of Textiles Piyush Goyal revises mantra of 5F’s for fashion industry: Farms to Fibre to Fabric to
Fashion to Foreign export to make textile industry of India strong name in world.
→ Ministry of Textiles clears 23 strategic research projects worth around Rs 60 crores in areas of specialty
fibres, sustainable textiles, geotextiles, mobiltech, and sports textiles.
→ UNESCO launches one list documenting 50 iconic Indian heritage textiles – “Handmade for 21st Century:
Safeguarding Traditional Indian Textile”.
About:
 Geotextile:
→ What:
 permeable fabrics which, when used in association with soil, have ability to separate, filter, reinforce, protect,
or drain.
 typically made from polypropylene or polyester.
→ Coir geotextile:
 100% natural fiber
 obtained from renewable source – coconut husk.
 naturally resistant to rot, molds and moisture, and free from any microbial attack hence it needs no chemical
treatment.
 permeable, natural and strong fabric with high durability.
 protects land surface and promotes quick vegetation.
 totally biodegradable
 helps in soil stabilisation.
 It can dissipate energy of flowing water and absorb excess solar radiation.
→ Application:
 They support many civil engineering applications including roads, airfields, railroads, embankments, retaining
structures, reservoirs, canals, dams, bank protection, coastal engineering and construction site silt fences or
geotube.
 They are also used for sand dune armoring to protect upland coastal property from storm surge, wave action
and flooding.
 They are used as matting to stabilize flow in stream channels and swales.
 They can improve soil strength at a lower cost than conventional soil nailing.
 Technical textiles:
→ What:
 Textile materials / products manufactured mainly for technical performance, functional properties
rather than aesthetic and decorative characteristics.
→ Feature:
 permeability, flexibility, ease of underwater placement
→ Categories (based on application):
 Agrotech textile; Buildtech textile; Clothtech textile; Geotech textile; Hometech textile; Indutech textile,
Mobiltech textile, Meditech textile, Protech textile, Sportstech textile etc.
→ Significance:
Page 156 of 719
  Technical Textiles are used globally for last several decades.
 provided innovative engineering solutions for several applications in civil and geotechnical engineering, for
infrastructure water resources projects.
 perform better than concrete in terms of water protection [because of permeability, flexibility, ease of
underwater placement].
→ Global market of Technical Textiles:
 USD 250 billion. India’s share is about USD 20 billion.
 Biggest players: U.S., West European countries, China, Japan.
→ India:
 India is yet to capitalise technical, economical and environmental benefits of technical textiles on large scale
[Technical Textiles are extensively used in developed and many developing countries].
 Many parts of India are subjected to floods and environmental degradation. Flood management and control can
rely on Technical Textiles tubes, containers and bags.
 Presently in 2022, India shares only 6% of world market and usage level is only 5-10% while usage in advanced
countries is about 30-70%.
 India’s status:
→ Almost 4 crore people are employed across textile value chain in India. After agriculture, textiles and garments sector
is 2nd biggest employment generator in India.
→ India is world’s 5th-largest exporter of apparel, home, and technical products.
 Initiative:
→ In 2019, government issued HSN Codes for technical textiles. After two years, India became net exporter of technical
textiles.
→ Many technical textile items are made mandatory for use by government organisations covering agriculture,
horticulture, highways, railways, water resources, medical applications.
→ SAMARTH / Scheme for Capacity Building in Textile Sector (SCBTS):
 What:
• One flagship skill development scheme of Min. of Textiles approved in continuation to Integrated Skill
Development Scheme (ISDS). Textile industry is facing shortage of skilled workers and provides many
opportunities for unemployed youth in India who are trained in Textile sector. To address this issue, GOI
launched SCBTS and named it SAMARTH Scheme.
 Objective:
• To provide demand-driven, placement-oriented skilling programme to incentivize efforts of Textile industry
in creating jobs in organized textile and related sectors to promote skilling and skill up-gradation in
traditional sectors through respective sectoral divisions / organizations of Ministry of Textile;
• To provide livelihood to all sections of society across India.
 Function:
• This Scheme would target to train 10 lakh persons over period of 3 years (2017-20) and has invited
participation of Textiles Industry / Associations registered under Central or State Government / Chambers
of Commerce of Central or State Government.
→ National Technical Textiles Mission (NTTM) [2020].
→ PM-MITRA Scheme [2021]:
 What:
• PM Mega Integrated Textile Region and Apparel
• To empower textile sector, GOI will set up 7 Mega Integrated Textile Region and Apparel Parks which will
integrate entire textile value chain from spinning, weaving, processing / dyeing, and printing to garment
manufacturing at one location.
 Background:
• to realize vision of building Aatmanirbhar Bharat by positioning India strongly on Global textiles map.
• inspired by 5F vision of Hon’ble Prime Minister - Farm to Fibre to Factory to Fashion to Foreign.
 Aim:
• create world-class industrial infrastructure to attract cutting-edge technology and boost FDI and local
investment in textile sector.
 Feature:
• PM MITRA park / site (Industrial Park / textiles manufacturing units)
• World class Industrial infrastructure to attract investment.
 Implementation:
• PM MITRA park will be developed by Special Purpose Vehicle (SPV) owned by Central govt., State
Government and in Public Private Partnership (PPP) mode.
• Each MITRA Park will have incubation centre, common processing house, common effluent treatment plant,
other textile related facilities - design centres, testing centres.
 Funding:
Page 157 of 719
 • centre will provide capital for development of infrastructure of Rs. 500 crore for greenfield MITRA park and
Rs. 200 crore for brownfield park.
 Advantages:
• generateabout 1 lakh direct and 2 lakh indirect employment per MITRA park.
• integrated textiles value chain (spinning, weaving, processing/ dyeing, printing, garment manufacturing) at
one location and thus would ease business and will reduce logistics costs of textile Industry.
Note:
 National Technical Textiles Mission (NTTM) [2020]:
→ Aim:
 To increase use of technical textiles in domestic market. Make India global leader in textile industry.
→ Feature:
 It will be implemented for 4 years (from 2020-21).
 Component: Research and development (R&D); Market development; Export promotion; Education & skill
development.
 Focus: Usage of technical textiles in many flagship schemes of govt.
→ Significance:
 Overall improvement in cost economy. Promote Make in India.
 Greenfield:
→ completely new project that has to be executed from scratch
 Brownfield project:
→ one that has been worked on by others.
 “Handmade for 21st Century: Safeguarding Traditional Indian Textile”:
→ One list launched by UNESCO in 2022 documenting 50 exclusive and iconic Indian heritage textile crafts of
India. Toda embroidery (TN), Sungadi (TN), Himroo weaves (Hyderabad), Bandha tie and dye weaving
(Odisha) are some of textiles included in this list. This lists histories and legends behind included textiles,
and describes complicated and secret processes behind their making, mentions causes for their dwindling
popularity, and provides strategies for their preservation.
 Conventional Textile vs Technical Textile:
→
{Conventional Textile} {Technical Textile}
Manufactured primarily for aesthetic or decorative Manufactured primarily for performance or
purpose. function.
Fiber (natural or synthetic) is usually 1 st spun in Woven or non-woven. Primarily made of synthetic
Yarn and then Yarn is woven / knit into Fabric. fibers and some natural fibers.
Mains Link:
 Discuss the significance of technical textiles.
 Discuss the significance of PM-MITRA scheme.

GENETIC ENGINEERING (GE)

News:
 2020:
→ Genetic Engineering Appraisal Committee (GEAC) gives greenlight for biosafety field trial for one new variety
of genetically modified brinjal (Bt Brinjal). Experts have criticized said GEAC move.
→ If their demand for usage of latest technologies is not granted, farmers threaten to mass sow GM seeds of maize,
soyabean, mustard, brinjal, Herbicide Tolerant (Ht) BT cotton, although these are not yet approved.
 2021:
→ FSSAI issues guidelines for GMO limits in imported food crops.
→ Illegal cultivation of herbicide-tolerant (HT) Bt cotton increases.
→ World’s 1st genetically modified (GM) rubber sapling [rubber gene MnSOD (manganese-containing superoxide
dismutase) was inserted in rubber] was planted in Guwahati, Assam.
→ Union government allows import of crushed genetically modified (GM) soyabean, which is major ingredient of
poultry feed.
→ With rising soyabean prices escalating poultry industry’s costs, Union govt. allows import of tonnes of crushed and
de-oiled Genetically Modified (GM) soya cake.
→ FSSAI releases draft regulations for GM foods.
→ Social activists say FSSAI draft regulations on genetically modified (GM) food is unacceptable.
 Demand:
• Social activists want FSSAI to explicitly say that GM foods will not be allowed into India by way of production
or imports. Because, they say any kind of GM food in India is threat to health of our people, to our
environment, and to diverse food cultures of India.

Page 158 of 719

 • FSSAI draft proposes that all food products having individual genetically engineered ingredients of 1% or
more will be labeled as “Contains GMO/ingredients derived from GMO”. Now, Social Activists says this is
implied approval to import of GM food instead of prohibiting.
 2022:
→ Department of Biotechnology (DBT) issues - Guidelines for Safety Assessment of Genome Edited Plants, 2022 -
guidelines easing norms for research into genetically modified (GM) crops and circumventing challenges of using
foreign genes to change crops profile. These guidelines are applicable to all public / private organisations involved in
research, development and handling of Gene Edited Plants.
→ Haryana issues No-Objection Certificate (NOC) to Mahyco (seed major company) to conduct field trials on BG-2 RRF
(herbicide-tolerant and insect-resistant variety of BT cotton). BG-2 RRF can provide protection against devastating
pest attacks such as American Bollworm.
→ GEAC, which functions in the MoEFCC, might approve the commercial cultivation of modified mustard: Genetically
modified crops may soon get the GOI nod, a move that could pose a threat to crop diversity, food security and
increase pesticide tolerance. This GOI move might also severely affect the agrarian sector, as the seed market will be
in the hands of private companies instead of farmers, according to experts. Thus, activists write to environment
ministry against allowing commercial use of genetically modified crops, objecting to the potential approval of unsafe,
unneeded and unwanted genetically modified organisms (GMO).
→ GEAC recommends the “environmental release” of the transgenic hybrid mustard DMH-11 for seed production and
conduct of field demonstration studies with respect to its effects, if any, on honey bees and other pollinating insects.
→ Genetic Engineering Appraisal Committee (GEAC) (state-run biotech regulator) that functions under the Union
Environment Ministry has yet again cleared the proposal for the commercial cultivation of genetically modified (GM)
mustard. The recommendation will now again go for the approval of the Environment Ministry. [Though the GEAC
had cleared the proposal in 2017, the Ministry had vetoed it and suggested that the GEAC hold more studies on the
GM crop].
About:
 What:
→ Modification of gene by introducing alien gene so as to get desired effects, surpassing / going beyond that genus
barrier. Alien gene could be from plant, animal, soil bacteria etc.
 Purpose:
→ to achieve desirable new trait not occurring naturally in that species.
 Technique:
→ Genome editing / Genome engineering / Gene editing:
 What:
• Type of genetic engineering in which DNA is inserted, deleted, modified, or replaced in genome of living
organism. Unlike early genetic engineering techniques that randomly inserts genetic material into host
genome, genome editing targets insertions to site specific locations.
 Feature:
• Genome editing involves use of technologies that allow genetic material to be added, removed, or altered
at particular locations in genome. Several approaches to genome editing are developed. One well-known is
called CRISPR-Cas9, which is short for Clustered Regularly Interspaced Short Palindromic Repeats and
CRISPR-associated protein 9.
 Usage: Biological research, medical research (gene therapy etc.), pharmaceutical drugs, Agriculture (golden rice,
Bt cotton etc.), Genetically modified insulin producing bacteria, Biofuel production from GM bacteria, etc.
 Significance:
→ GE allows introduction of new traits
→ GE allows greater control over traits when compared to previous methods - selective breeding, mutation breeding.
 Example:
→ Genetically Modified Organism (GMO):
 organism (organism is any organic, living system that functions as individual entity - animals, plants,
microorganisms etc.) whose genetic material has been altered using genetic engineering (GE) technique so as to
achieve trait that does not occur naturally by mating and / or natural recombination in that organism.
 Gene modification / transfer can be from:
• within same species
• across species (transgenic organism)
• across kingdoms.
 GE / Gene modification / transfer involves:
• mutation of genes (alteration)
• insertion of genes (BT cotton etc.)
• deletion of genes.
 Example:
• Genetically Modified Crop (GM Crop) / GM Seed / Transgenic crop:

Page 159 of 719

  plant that has combination of genetic material obtained through modern biotechnology.
 Agricultural plant whose DNA has been modified using genetic engineering (GE) methods / techniques,
to introduce new desired trait to that plant which does not occur naturally (via pollination etc) in that
plant species.
 GM Seed is seed which is genetically modified by introducing alien gene in that seed so as to get desired
effects, surpassing / going beyond genus barrier of that original seed.
 GM plants involve transgenic technology or introducing gene from different species into plant. For
instance, BT-cotton, where gene from soil bacterium is used to protect plant from pest attack.
 GM crop can contain gene(s) that has been artificially inserted instead of plant acquiring it through
pollination.
 Desired traits are Herbicide tolerance, Insect resistance etc.
 Note: In reality, all crops have been genetically modified from their original wild state by domestication,
selection, and controlled breeding over long periods of time.
 Benefit: Targeted medicines, Biofuels, Disease-resistant crops, New industrial products.
 Issue: GM Crop’s genes may spread to neighboring plants, where such effects are not intended.
 Challenges: Safety, Ethical concerns, Regulatory challenges.
 Example:
o Bt Brinjal:
✓ to resist attacks of ‘fruit and shoot borer’ moth (pest).
o Bt cotton:
✓ only GM crop allowed in India, for cultivation.
✓ developed by US
✓ 2 genes - ‘Cry1Ab’, ‘Cry2Bc’ from soil bacterium - Bacillus thuringiensis (Bt) – are inserted into
cotton seeds, that allows cotton to defend against common pest - Pink Bollworm.
✓ In 2002, India allowed commercial release of Bt Cotton.
✓ India has allowed commercial use of BG-1 GM cotton and BG-2 GM cotton in India while
approval for BG-2 RRF is pending at various stages.
o HtBt cotton:
✓ derived from Bt cotton with insertion of another gene – ‘Cp4-Epsps’, from another soil
bacterium - Agrobacterium tumefaciens, which allows cotton to resist common herbicide –
glyphosate.
o GM Mustard / Dhara Mustard Hybrid (DMH-11) mustard.
o GM seed of maize
o GM seed of soyabean
o GM seed of mustard
o GM seed of brinjal
o GM seed of Herbicide Tolerant (Ht) BT cotton.
o Golden rice.
• Genetically Modified Food (GM Food) / Genetically Engineered Food (GE Food) / Bioengineered Food:
 foods produced from Genetically Modified Organism (GMO)
 Arguments:
o
{Benefit of GM crop} {Drawback of GM crop}
More productivity, less pesticide use, more GM crops can pose a threat to crop diversity,
investments in agriculture research, and food security and increase tolerance for
employment creation for agriculture use of pesticides, seed market will shift into
graduates. the hands of private companies from farmers.
Food security, higher yields, more income, Threat to the environment as GM mustard
reduced use of pesticide and herbicides and which is a herbicide tolerant crop, may pose a
thus protecting environment. threat to crop diversity, loss to traditional
knowledge etc.
Can withstand climate change. Consequence on human health, genetic
contamination of environment, seed stock
may be contaminated at molecular level.
Example – success of BT cotton. Farmers may face unfair practices of MNCs.
Bt cotton crop loss faced by farmers due to
pest attack.
 Arguments:
→
{favour} {Against}
Reduced costs: Environmentalists argue that long-lasting effect of
GM crops is yet to be studied.

Page 160 of 719

 a. In case of HtBt cotton, cost of weeding goes
down considerably and
glyphosate herbicide can be used against
weeds.
b. In case of Bt Brinjal, cost is reduced as cost
of production is reduced by decreasing
usage of pesticides.
More productivity, less pesticide use, more Farmers are at risk because there is no
investments in agriculture research, employment accountability of quality of seed
creation for agriculture graduates.
Environmentalists argue that genetic modification
brings changes that can be harmful to humans in
long run.
pollutes environment
Government also loses revenue in terms of tax
collection.
Industry lobbies argue that cultivation of genetically
modified cotton variant has serious environmental
and economic consequences.
GM crops can pose a threat to crop diversity, and
food security and increase pesticide tolerance, seed
market will shift into the hands of private companies
from farmers.
Example – farmers. Example - Environmentalists.
 GE regulation in India / Authority:
→ GEAC - apex body that allows / regulates commercial release of GM crops.
→ Food Safety and Standards Authority of India (FSSAI) - authorised body to regulate GM imported crops in
India.
→ Penalty:
 Usage of unapproved GM variant is penalized under Environmental Protection Act ,1986.
 Seeds Act, 1966
 Current Status of India:
→ Bt cotton - only GM crop allowed to be cultivated in India.
→ India allows import of GM soyabean
→ India allows import of GM canola oil.
→ India had for 1st time exempted certain types of genome-edited crops from stringent regulations applicable on
genetically modified or GM crops, paving way for further R&D on them.
 Other countries:
→ Many countries have either developed or approved for commercial cultivation of vegetables, fruits, oilseeds, and
cereals developed through genome editing such as Gamma-aminobutyric acid or GABA tomato, high oleic canola and
soybean, non-browning mushroom etc.
→ China too approved guidelines for genome editing that will spur research into crops that have high yields and are
resistant to pests and climate change.
 Way forward:
→ GMOs data – biosafety trials, field trials etc. - should be made available to public / people.
→ Biosafety trial should be conducted and its report shall be made available to public /people.
→ Transparency and accountability should be ensured.
Note:
 Genetic Engineering Appraisal Committee (GEAC):
→ What:
 GEAC functions in Ministry of Environment, Forest and Climate Change (MoEF&CC). As per Rules, 1989, GEAC is
responsible for appraisal of activities involving large scale use of hazardous microorganisms and recombinants
in research and industrial production from environmental angle. GEAC is also responsible for appraisal of
proposals relating to release of Genetically Engineered (GE) organisms and products into enviornment including
experimental field trials.
 statutory body notified under Environment (Protection) Act, 1986.
→ Member:
 Chaiperson - Special Secretary / Additional Secretary of MoEF&CC
 Co-Chairman - representative of Department of Biotechnology, Ministry of Science and Technology
→ Function:

Page 161 of 719

  appraisal of activities involving large scale use of hazardous microorganisms and recombinants in research and
industrial production from environmental angle.
 appraisal of proposals relating to release of genetically engineered (GE) organisms and products into
enviornment including experimental field trials.
 Guidelines for Safety Assessment of Genome Edited Plants, 2022:
→ What:
 issued by DBT
 Guidelines to ease norms for research into genetically modified (GM) crops and circumventing challenges of
using foreign genes to change crops profile.
→ Feature:
 These guidelines are applicable to all public / private organisations involved in research, development and
handling of Gene Edited Plants.
 All requirements that researchers must adhere to develop transgenic seeds will apply to gene-edited seeds
except clauses that require permission from GEAC.
→ Exemption:
 Researchers who use gene-editing technology to modify genome of plant are exempt from seeking approvals
from GEAC. Final call however is taken by Environment Minister as well as States where such plants could be
cultivated.
→ Concerns:
 Environmentalist groups have opposed this exception for gene-edited crops. They say, gene editing is included
in genetic engineering and therefore, there is no question of giving exemptions to particular kind of genome
edited plants from regulatory purview. Gene editing techniques involve altering function of genes and can cause
“large and unintended consequences” that can change “toxicity and allergenicity” of plants.
 2021 FSSAI draft regulations for GM foods:
→ No one can manufacture or sell any food products or food ingredients derived from genetically modified organisms
(GMOs) without prior approval.
→ It specifies norms that labs should adhere for testing GM foods.
→ These regulations will apply to:
 Genetically Modified Organisms (GMO)
 Genetically Engineered Organisms (GEO)
 Living Modified Organism (LMO)
intended for direct use as food or in food processing.
→ These regulations will include food productsmade using food ingredient or food processing derived from GMOs, even
if GM content is not present in end-product.
→ GMO, GEO shall not be used as ingredients in infant food products.
→ These regulations propose labelling norms for food products that contain 1% or more GMO content.
 Genetically modified (GM) soyabean:
→ Usage:
 major ingredient of poultry feed.
→ Status in India:
 India allows import of GM soybean, GM canola oil.
→ Need for import:
 Indian Poultry industry has been crushed by multiple disasters over last years.
 In 2020, false rumour that COVID-19 could be spread by eating chicken meat led to crash in poultry demand.
 In 2021, avian flu cases led to another crash
 In 2021, crippling rise in prices of poultry feed.
 Cost of soyabean shot up.
→ Concerns / criticisms on import:
 Environmental activists are worried about genetically modified plant entering human food chain, given that
India’s regulatory system has yet to approve GM foods.
 1989 rules of Environment Protection Act, 1986 applies not just to GM organisms, but also to GM products.
 GM mustard:
→ What:
 Indian variety of GM Mustard [Dhara Mustard Hybrid – 11 (DMH - 11)] was conceived in 2022 by Deepak Pental,
the then-vice chancellor of Delhi University, through transgenic technology (primarily involving the Bar, Barnase
and Barstar gene systems) by crossing a popular Indian mustard variety ‘Varuna’ (the barnase line) with an East
European ‘Early Heera-2’ mutant (barstar).
→ Benefit:
 DMH-11 is claimed to have shown an average 28% yield increase over Varuna in contained field trials carried out
by ICAR.
→ Issue:
Page 162 of 719
  Threat to the environment as GM mustard is a herbicide tolerant crop, and thus it may pose a threat to crop
diversity, loss to traditional knowledge etc.
→ Status:
 MoEFCC will take final call, and the commercial use of DMH-11 will be subject to the Seeds Act, 1966 and related
rules and regulations.
Value Addition:
 Somaclonal variation:
→ variations in plants that have been produced by plant tissue culture.
Question:
 Bollgard I and Bollgard II technologies are related to developing genetically modified crop plants. Bollgard I Bt cotton
(single-gene technology) is India’s 1st biotech crop technology approved for commercialization in India in 2002, followed
by Bollgard II – double-gene technology in 2006, by GEAC, Indian regulatory body for biotech crops.
 Reasons why people resist introduction of Bt brinjal in India are:
→ There is apprehension that consumption of Bt-brinjal may have adverse impact on health.
→ There is some concern that introduction of Bt-brinjal may have adverse effect on biodiversity.
 Other than resistance to pests, the prospects for which genetically engineered plants have been created are: To enable
them to withstand drought, To increase the nutritive value of the produce, to increase their shelf life.
 GEAC is constituted under Environment (Protection) Act, 1986.
Mains Link:
 Discuss the CRISPR gene-editing technology and the concerns raised by it. (250 words)
 What can be the geopolitical and geo-economic consequences of COVID-19? Discuss.
 Discuss the functions of GEAC.
 Compare Gene editing with that of Genetic modification. Discuss the potential benefits and risks associated
with Genetic modification in crops.
 It is argued that genetically modified crops can solve the myriad challenges associated with Indian agriculture.
Discuss in light of GEAC’s approval of the environmental release of GM Mustar d. (250 words)

SPACE TELESCOPE / SPACE OBSERVATORY

News:
 2021:
→ Square Kilometre Array Observatory (SKAO) Council approves establishment of world’s largest radio telescope.
→ With help of ASTROSAT (1 st Indian space observatory) among others, Astrophysicists in India spotted by
rare merging of 3 supermassive black holes.
 Significance: Many Active Galactic Nuclei (AGN) pairs have been detected in past. But, triple AGN are extremely
rare, and only few has been detected till now.
 2022:
→ James Webb Space Telescope is finally getting ready to fixate its numerous golden mirrors on distant
targets. Firstly, it will be looking at Jupiter and will also take closer look at Jupiter’s moons Io and
Ganymede (only known moon that has its own magnetosphere).
→ India’s Astrosat space telescope has witnessed birth of black hole in space for 500th time.
→ India’s 1 st liquid-mirror telescope - International Liquid Mirror Telescope (ILMT) is now at commissioning
phase and will start scientific observations some time in 2022.
→ NASA’s James Webb telescope beams 1 st cosmic view of ‘deepest’ universe. 1 st image from this NASA's new
space telescope is deepest view of universe ever captured , showing galaxies and offers deepest look of
cosmos ever captured.
 Importance of this new astronomical discoveries:
• Provides look into past: Part of image is light from not too long after Big Bang, which was 13.8 billion years
ago. James Webb can see backwards in time to just after Big Bang by looking for galaxies that are so far
away that light has taken many billions of years to get from those galaxies to our telescopes. JSWT has
largest mirror in space and it will look deeper into universe – and thus further back in time – than is possible
with presently deployed telescope such as Hubble.
• Decipher mysteries of Universe: Mysteries such as what made universe expand so quickly less than one
nanosecond after Big Bang.
• Explore Dark Age of Universe: Dark Age is period before gravity formed 1st stars and galaxies that eventually
began to emit 1st light.
• Understand formation of planetary system and look for signs of life on exoplanets: JSWT can achieve it with
much greater accuracy owing to its large mirror and superior Infrared Spectrograph instrument.
→ India’s 1 st observatory to monitor space activity to come up in Uttarakhand. [This will improve
effectiveness of tracking and identifying pre-existing resident space objects, and will result in creation of
hybrid data pool that will serve both commercial and defence sectors of space industry]. It will be India’s
1 st commercial space situational awareness (SSA) observatory, to track objects as small as 10 cm in size

Page 163 of 719

 orbiting earth, which will be set up in Garhwal region, Uttarakhand by Digantara (one space sector start-
up).
→ Uttarakhand Governor Lt. General Gurmeet Singh highlights the need for discussing future possibilities of
the 104 cm Sampurnanand Telescope (ST), a world-class telescope located near Nainital, at a workshop
organised to commemorate the completion of 50 years of successful operations of the telescope.
→ NASA releases stunningly detailed images of the Pillars of Creation taken by the Near Infrared Camera
(NIRCam) of the James Webb Space Telescope (JWST).
About:
 What:
→ telescope in outer space used to observe astronomical objects
 Types of Telescopes:
→ Optical telescope:
 visible light
→ Long-wavelength telescopes:
 Infrared
 Radio waves (Radio telescope):
• Unlike optical telescopes, Radio telescope can detect invisible gas and reveal space areas that may be
obstructed by cosmic dust.
• 1st radio signals were detected by physicist, Karl Jansky in 1930s.
→ Short-wavelength telescope:
 Ultraviolet; x-rays; gamma rays.
 Liquid-mirror telescope:
→ What:
 Telescopes with mirrors made with reflective liquid. Most common liquid used is mercury, but other liquids will
work as well (for example, low-melting alloys of gallium).
→ Mechanism:
 Liquid and its container are rotated at constant speed around vertical axis, which causes surface of liquid to
assume paraboloidal shape. This parabolic reflector can serve as primary mirror of reflecting telescope. Rotating
liquid assumes same surface shape regardless of container's shape; to reduce amount of liquid metal needed,
and thus weight, rotating mercury mirror uses container that is as close to necessary parabolic shape as possible.
→ Significance:
 Liquid mirrors can be low-cost alternative to conventional large telescopes.
 Compared to solid glass mirror that must be cast, ground, and polished, rotating liquid-metal mirror is much less
expensive to manufacture.
 Hubble Space Telescope (HST) / Hubble [1990]:
→ What:
 large telescope in space (space telescope) in low Earth orbit (LEO). NASA, with contributions from European
Space Agency (ESA). only telescope designed to be serviced in space by astronauts. makes one orbit around
Earth every 95 minutes. optical telescope. NASA’s flagship telescope.
→ Orbit:
 orbits around Earth at altitude of about 550 km above it (LEO).
→ Function:
 looks deep into space with cameras, that can see across entire optical spectrum from infrared to ultraviolet,
expanding frontiers of visible Universe.
→ Achievement:
 Discovered moons around Pluto.
 Evidence of black holes.
 Birth of stars have been observed.
 observation of merging of 6 galaxies.
 James Webb Space Telescope (JWST) / Webb [2021]:
→ What:
 formerly known as “Next Generation Space Telescope” and was renamed in 2002 after one former NASA
administrator, James Webb. JWST is one space telescope designed primarily to conduct infrared astronomy. As
largest optical telescope in space, its high infrared resolution and sensitivity allow it to view objects too early,
distant, or faint for Hubble Space Telescope. This is expected to enable broad range of investigations across
fields of astronomy and cosmology, such as observation of 1 st stars and formation of 1st galaxies, and detailed
atmospheric characterization of potentially habitable exoplanets. Large infrared telescope. world’s premier
space science observatory. orbiting infrared observatory. Joint CSA-NASA–ESA space telescope. planned to be
NASA's flagship astrophysics mission, succeeding Hubble Space Telescope. one of grand scientific projects of
21st Century. successor of Hubble Space Telescope.
→ Feature:

Page 164 of 719

  much bigger mirror [with approximately 6.5 meter primary mirror.]
 longer wavelength coverage.
 greatly improved sensitivity.
 JSWT will observe in near-infrared light rather than light in visible part of spectrum (unlike Hubble) and thus it
will have much greater capacity to see obscure stars and galaxies.
→ Orbit:
 Webb will not actually orbit Earth. Instead, it will sit at Earth-Sun L2 Lagrange point (5 million km away). At L2
point, Webb’s solar shield will block light from Sun, Earth, Moon which will help Webb stay cool, which is very
important for infrared telescope.
→ Mirrors:
 Made from beryllium and coated with gold.
→ Function:
 provide improved infrared resolution and sensitivity over Hubble
 investigations across astronomy and cosmology
 observing some of most distant events and objects in universe - formation of 1st galaxies etc.
 look deeper into cosmos – and thus further back in time – than is possible with Hubble.
→ Significance:
 complement and extend discoveries of Hubble Space Telescope
 Scientists hope it can detect light from very 1stpopulation of stars in Universe to switch on more than 13.5 billion
years ago.
 Space Situational Awareness (SSA):
→ It refers to knowledge of space environment, including location and function of space objects and space weather
phenomena. SSA is generally understood as covering 3 main areas:
 Space Surveillance and Tracking (SST) of man-made objects.
 Space WEather (SWE) monitoring and forecast.
 Near-Earth Objects (NEO) monitoring (only natural space objects).
→ Initiative:
 NETRA (NEtwork for space object TRacking and Analysis) [ISRO].
 Indo-US SSA arrangement.
 India:
→ Astrosat [2015].
→ International Liquid Mirror Telescope (ILMT).
→ NETRA:
 NEtwork for space object TRacking and Analysis. Space Situational Awareness (SSA) Control Centre set up by
ISRO in Bengaluru to safeguard ISRO’s space assets from space debris; monitor, track and protect national space
assets.
Note:
 Missions to explore Universe:
→ Hubble Space Telescope [1990]: Observation in Visible and Ultra-violet.
→ Compton Gamma Ray Observatory (CGRO) [1991: Observation in Gamma Ray.
→ Chandra X-Ray Observatory (CXO) [1999].
→ SPHEREx (to be launched in 2025): It aims to search for fundamentals of life — such as water and organic matter
within Milky Way.
→ Wide-field Infrared Survey Explorer (WISE) [2009].
→ Nancy Grace Roman Space Telescope (Roman or Roman Space Telescope): It is formerly Wide-Field Infrared Survey
Telescope (WFIRST) [2026].
 SKAO Council:
→ What:
 new intergovernmental radio astronomy organization. headquartered in UK. dedicated to radio astronomy.
→ Member:
 Canada, UK, Sweden, Netherlands, Italy, China, India, South Africa, Australia, New Zealand.
 Astrosat [2015]:
→ What:
 Space telescope. India's 1st dedicated multi-wavelength space telescope. With success of this satellite, ISRO has
proposed launching AstroSat-2 as successor for Astrosat. It was launched by ISRO on PSLV into Near-earth
equatorial orbit. It is multi-institute collaborative project, involving IUCAA, ISRO, Tata Institute of Fundamental
Research (Mumbai), Indian Institute of Astrophysics (Bengaluru), and Physical Research Laboratory
(Ahmedabad), among others.
→ Feature:
 Wavelengths:
• soft X-ray, hard X-ray, Visible, near UV, far UV.
Page 165 of 719
  AstroSat has 5 telescopes seeing through different wavelengths simultaneously — visible, near UV, far UV, soft
X-ray, hard X-ray.
 AstroSat has one UltraViolet Imaging Telescope (UVIT), which is capable of imaging in far and near-ultraviolet
bands over wide field of view.
→ Significance:
 It found birth of many blackholes.
 It has been studying Gamma-Ray Bursts (GRB).
 Arecibo Telescope:
→ Located in Puerto Rico
→ 2nd-largest single-dish radio telescope in world that collapsed in 2020.
 Square Kilometre Array (SKA) Telescope:
→ world’s largest radio telescope.
→ to be located in Africa, Australia
→ overseen by SKAO.
 International Liquid Mirror Telescope (ILMT) [India]:
→ What:
 It is only liquid-mirror telescope operational anywhere in world. It is located at Devasthal Observatory campus,
Aryabhata Research Institute of Observational Sciences (ARIES), Nainital, Uttarkhand, autonomous institute
under Department of Science and Technology, Government of India. It is world’s 1 st liquid-mirror telescope, that
is commissioned for astronomy. Other liquid-telescopes previously built were either to track satellites or were
used for military purposes. ILMT will be 3rd telescope facility at Devasthal, that has become world’s pristine sites
for obtaining astronomical observations.
→ Feature:
 Unlike conventional telescopes that can be steered to track specific stellar source objects, ILMT will be
stationary.
 It will basically carry out observations and imaging at zenith, that is, of overhead sky.
 This is survey telescope having high potential for discovering newer objects.
→ Fact:
 It will hold unique tag of being maiden liquid-telescope globally to be designed exclusively for astronomical
purposes.
 This international telescope facility is result of collaborative work between astronomers from Canada, Belgium,
India.
 Murchison Widefield Array (MWA) radio telescope:
→ joint project between international consortium of organisations to construct and operate low-frequency radio array
telescope.
→ operates in frequency range 70–300 MHz
→ One goal is to detect neutral atomic Hydrogen emission from cosmological Epoch of Reionization (EoR), to study Sun,
heliosphere, Earth’s ionosphere, radio transient phenomena, and map extragalactic radio sky.
 Gamma-Ray Bursts (GRB):
→ In gamma-ray astronomy, GRBs are immensely energetic explosions that have been observed in distant
galaxies. They are most energetic and luminous electromagnetic events since Big Bang. Bursts can last from
milliseconds to several hours. After initial flash of gamma rays, longer -lived "afterglow" is usually emitted
at longer wavelengths (X-ray, ultraviolet, optical, infrared, microwave, radio).
→ They are brightest and most energetic electromagnetic events known to occur in universe.
→ GRBs shine 100 of times brighter than typical supernova and about million trillion times as bright as Sun.
→ When GRB erupts, it is briefly brightest source of cosmic gamma -ray photons in observable Universe.
 HST vs JWST:
→
{HST} {JWST}
Orbit Located in LEO Located 1.5 million km away from
earth. It will not orbit earth but will sit
at Lagrange Point 2. This will allow it
to shield from light of Sun, Moon, and
Earth and thus avoid light
interference.
Mirror Smaller Primary mirror Bigger Primary mirror. Much bigger
which allows it to capture light 6
times greater than Hubble can. It will
be able to study Old and distant
galaxies, which is not currently
possible with Hubble.

Page 166 of 719

 Strength Shows images formed 400 million It is 100 times more powerful than
years after Big Bang. Hubble is. It will show images from
250 million years after Big Bang-
taking us closer to starting point of
Universe.
Low no. of mirror segments Many mirror segments
Can be repaired Not repairable
Look back 12.5 bn years and look into Look back 13.5 bn years ago and
young galaxies. watch birth of new galaxies.
Spectrum Explores into UV, visible, parts of Explores into near-infrared lights,
near-infrared lights. Mostly mid-infrared lights. Infrared: It will
ultraviolet (visible) light. reveal clearer details about objects in
distant places. Analogically, Hubble
can see equivalent of “toddler
galaxies” and James Webb Telescope
will be able to see “baby galaxies”.
 Sampurnanand Telescope [1972]:
→ It is a world-class 104 cm wide optical telescope located near Nainital, Uttarakhand. In 2022, it completed
50 years of successful operations. It was named after the former CM of Uttar Pradesh Dr Sampurnanand.
It is situated at ARIES, Manora Peak in Nainital. It was installed in 1972.
→ Its landmark observations: Discovery of rings of Uranus, and additional rings around Saturn, afterglows of
Gamma-ray-bursts (GRBs) and micro-lensing events etc.
Question:
 Evidences for continued expansion of universe are:
→ Detection of microwaves in space: Cosmic microwave background (CMB) is radiation left over from early
stages of formation of Universe. As Universe is expanding, light has changed its wavelength and cu rrently,
and it can be detected in microwave region of radio spectrum.
→ Observation of redshift phenomenon in space: Redshift and blueshift describe change in frequency of light
wave depending on whether object is moving towards or away from us. When object is moving away from
us, light from object is known as redshift, and when object is moving towards us, light from object is known
as blueshift.
Mains Link:
 The James Webb telescope is an exemplar of collaborative science and human ingenuity. Discuss its significance
to the scientific community. (10M)

FOREIGN CONTRIBUTION
News:
 2021:
→ NGO moves Delhi High Court seeking exemption from Union Home Ministry’s order to open FCRA account with SBI
branch in New Delhi.
→ Foreign Contribution (Regulation) Amendment Act, 2020 passed.
 2022:
→ Supreme Court asked thousands of NGOs to go back to government for redressal of their grievances on non-renewal
of their FCRA registration. [Petition had filed in Supreme Court asking said NGOs to be allowed to continue receiving
and utilising foreign funds until Covid pandemic is over]. [Min. of Home had declined registration of some NGOs,
while thousands of NGOs did not apply for renewal before deadline].
→ In 2022 Noel Harper judgment, Supreme Court upheld Foreign Contribution (Regulation) Amendment Act, 2020,
made to Foreign Contribution (Regulation) Act, 2010, which introduced restrictions in handling of foreign
contributions by organizations in India.
→ CBI arrest representatives of NGOs, middlemen, public servants of FCRA division of MHA for committing violations
of FCRA provisions and facilitating illegal clearances via bribes.
 Issue: FCRA clearances have been fraught issue for many years, and government has often been accused of
targetting NGOs for political or ideological reasons by cancelling or not renewing their clearances. Registrations
of about 5,900 NGOs had ceased to be active in 2021, owing to either NGOs not applying for renewal before due
date, or MHA refusing their renewal for alleged violation of FCRA.
→ MoHA amends certain rules related to Foreign Contribution (Regulation) Act, 2010 allowing Indians to receive up to
Rs. 10 lakh per year from relatives staying abroad without informing authorities. Earlier limit was Rs. 1 lakh. In one
notification, Ministry MoHA also said that if amount exceeds Rs. 10 lakh, individuals will now have 90 days to inform
government, instead of 30 days earlier.
→ MoHA removes some crucial data from its FCRA website – fcraonline.nic.in - which includes list of NGOs whose
licences have been cancelled, and annual returns of NGOs.

Page 167 of 719

  Impact: It will lessen transparency in functioning of FCRA division (amid when allegations of corruption within
FCRA division are being investigated by CBI).
→ India has been highest recipient of aid from developed countries in 2020 and WTO’s Aid for Trade initiative [2005].
→ Ministry of Home Affairs cancels FCRA licence of Rajiv Gandhi Foundation (RGF) and Rajiv Gandhi Charitable Trust
(RGCT), organisations that are associated with the Nehru-Gandhi family, for alleged violations of the provisions of
the FCRA Act. [The NGOs came under the scanner in 2020 over the possible violations of the PMLA, the Income Tax
Act, FCRA].
About:
 What:
→ Foreign Contribution (Regulation) Act, 2010 / FCRA defines ‘foreign contribution’ as currency; or article other than
gift for personal use; or securities received from foreign sources.
→ Foreign contribution under FCRA covers any donation, delivery or transfer made by any foreign source of any article
as long as it is not given as gift for personal use, or if its market value in India at time it was made is not more than
such sum as may be specified from time to time by Central government.
 Law:
→ Foreign Contribution (Regulation) Act, 2010 / FCRA:
 What:
• FCRA, 2010 regulates foreign donations, and ensures that foreign contributions do not adversely affect
internal security of India.
• implemented by Ministry of Home Affairs.
 Purpose:
• Regulates foreign funding of voluntary organizations in India
 Feature:
• The FCRA requires every person or NGO wishing to receive foreign donations to be registered under the
Act.
• FCRA registration is mandatory for any NGO or association to receive foreign funds or donations.
• person, associations having definite cultural, economic, educational, religious or social programme after
getting registration or prior permission from Central Government can accept foregin contribution.
• 2020 Amendment Act says registered NGOs must open designated account in State Bank of India (SBI) in
that State Capital where foreign contributions would exclusively land.
• It gives Union government power to declare organisation as being one of political nature and deny it access
to funds from sources abroad.
• Only 5 purposes are allowed for receiving foreign contributions: social, educational, religious, economic,
cultural.
• [Under 2015 rules notified by MHA, NGOs are required to give an undertaking that the acceptance of foreign
funds is not likely to prejudicially affect the sovereignty and integrity of India or impact friendly relations
with any foreign state and does not disrupt communal harmony].
• These funds can be utilised only for the purpose for which they have been received, and as stipulated in the
Act.
• The receivers of foreign funds are also required to file annual returns, and they must not transfer the funds
to another NGO.
 Coverage:
• It covers any donation, delivery, transfer made by any foreign source of any article, currency, securities.
• donation from person of Indian origin (PIO) who assumed foreign nationality
 Exception:
• gift for personal use
• market value in India < limit set by Central government
• money received by way of fee or goods or services rendered by such person in ordinary course of his
business, trade or commerce whether within India or outside India.
• donations made by Non-Resident Indians (NRIs)
 Prior clearance / Prior Reference Category:
• Prior clearance from Ministry of Home Affairs is required for any NGO or association to receive foreign funds
or donations.
 Not eligible to accept foreign contribution:
• Election candidate
• Member of legislature (MPs or MLAs)
• Political party or office bearer
• Organization of political nature
• Medio orgs / Correspondent / columnist / journalist / cartoonist / editor / owner / printer / publishers of
registered Newspaper.
• Judge, government servant or employee of corporation / body, controlled / owned by Government.
Page 168 of 719
 • Association or company engaged in production or broadcast of audio news, audio visual news or current
affairs programmes through electronic mode.
• individuals or associations who have been specifically prohibited by Central Government.
 Public Interest:
• FCRA prohibits receipt of foreign contribution for activities detrimental to national interest.
• FCRA says NGOs require government’s permission to receive funding from abroad.
• FCRA says government can refuse permission if donation may affect public interest, economic interest of
India.
 Applicability:
• FCRA apply to territory of India, to citizens of India who may be outside India, to companies or their branches
outside India registered or incorporated in India.
• Entities covered by FCRA are individual, Hindu undivided family (HUF), association, registered company.
• The FCRA is applicable to all associations, groups and NGOs which intend to receive foreign donations. It is
mandatory for all such NGOs to register themselves under the FCRA.
 Period of certification:
• Once granted, FCRA registration is valid for 5 years.
• NGOs are expected to apply for renewal within specified months of date of expiry of registration.
• In case of failure to apply for renewal, FCRA registration is deemed to have expired, and NGO is no longer
entitled to receive foreign funds or utilise its existing funds without permission from MoHA.
• Organisations are required to register themselves every 5 years.
 Cancellation of registration:
• Government reserves right to cancel FCRA registration of any NGO if it finds NGO to be in violation of FCRA
2010.
• Registration can be cancelled if inquiry finds false statement in application; if NGO is found to have violated
any of terms and conditions of certificate or renewal; if it has not been engaged in any reasonable activity
in its chosen field for benefit of society for 2 consecutive years; or if it has become defunct.
• Central Government can also cancel if it is necessary in public interest to cancel certificate.
• Registrations are also cancelled when audit finds irregularities in finances of NGO in terms of misutilisation
of foreign funds.
• Once the registration of an NGO is cancelled, it is not eligible for re-registration for 3 years.
 How FCRA regulates NGO funding?
• FCRA regulates foreign donations to NGO
• FCRA ensures that foreign contributions do not adversely affect internal security of India.
• FCRA gives Union government power to declare organisation as being one of political nature and deny it
access to funds from sources abroad.
 Why regulation required for foreign contribution?
→ Intelligence Bureau (IB) inputs showed that foreign funds entering India were used to fund activities that
destabilise national peace and security. IB inputs even indicated that money was used to train naxals. So,
there is element of national security, integrity of nation involved here.
→ According to CBI, only about 10% of total non-government organisations (NGO) files their annual income
and expenditure statements with authorities.
 Way Forward:
→ Better coordination between Ministries of Home Affairs and Finance.
Note:
 Foreign Aid:
→ Aid for Trade (A4T):
 A4T is aimed at promoting trade for poverty reduction, by helping developing countries (esp. LDCs) in addressing
issues e.g. Supply-side, trade-related issues. Developed countries provide grants and concessional loans (as part
of Official Development Assistance) — targeted at trade-related programmes and projects.
 Foreign Contribution (Regulation) Amendment Act, 2020:
→ What:
 Act further to amend Foreign Contribution (Regulation) Act, 2010
→ Feature:
 It mandates that registered NGOs must open designated account in State Bank of India (SBI) in that State Capital
where foreign contributions would exclusively land.
→ Criticism:
 Cumbersome for NGOs operating in rural India and far away from State Capital.
→ Judiciary:
 In response to PIL filed challenging Foreign Contribution (Regulation) Amendment Act, 2020, Supreme Court in
2022 Noel Harper judgment upheld Foreign Contribution (Regulation) Amendment Act, 2020.
• Argument:
Page 169 of 719
  PIL petitioners challenged this 2020 Amendment Act as arbitrary, stringent and making functioning of
NGOs extremely difficult. They argued about below provisions of 2020 Amendment Act:
o Section that forbids recipient of foreign contribution from transferring same to any other entity.
o Section which reduces limit of usage of foreign contribution for administrative expenses from 50%
to 20%.
o Section which states that Centre can direct organization to not utilize foreign contributions pending
inquiry on suspected violations.
o Sections which state that foreign contributions must be deposited in FCRA account created in
specified branch of scheduled bank (SBI).
o Section which empowers Centre to obtain Aaadhaar numbers of key functionaries of organization
for approval.
 Centre argued that changes were necessary to prevent malpractices and diversion of funds by NGOs.
Mains Link:
 Discuss why FCRA has been controversial in the recent past.
 Discuss the major provisions of the Foreign Contribution (Regulation) Act (FCRA) and the need for such
legislation.

WORLD ECONOMIC FORUM (WEF) [1971]

News:
 Jan 2022:
→ WEF holds its annual meeting in Davos (Switzerland).
About:
 What:
→ Swiss non-profit foundation
→ based in Geneva, Switzerland.
→ founded by Klaus Schwab.
 Reports published:
→ Global Gender Gap Report.
→ Global Competitiveness Report.
→ Energy Transition Index.
→ Global IT Report.
→ Global Risk Report.
→ Global Travel and Tourism Report.
 Significance:
→ WEF summit is attended by people from across political and corporate world, including heads of state,
economists, policy makers, top executives, industrialists, media personalities, technocrats, top industry,
business leaders, civil society, international organizations
→ Discussions at WEF influence public sector decision -making, corporate decision-making, particularly on
poverty, social challenges, climate change, global economic recovery.
→ WEF forum is one perfect opportunity to find solutions to global challenges that emerge from time to time.
→ opportunities for collaboration through dialogue
 2022 WEF Agenda:
→ nature-positive solutions
→ Mission on Cyber Resilience to accelerate net-zero emissions.
→ Bridging vaccine gap
→ strengthening resilience of global value chains
→ building economies in fragile markets through human investment
→ Usage of data solutions to prepare for next pandemic
 Criticism:
→ It is more of networking hub than wisdom or platform to find effective solutions to global issues.
→ lack of representation from various sections of civil society
→ lack of effective solutions.
Value Addition:
 Great Reset:
→ name of 50th annual meeting of WEF, held in 2020.
→ It brought together high-profile business leaders, political leaders
→ agenda was to rebuild society and economy following COVID -19 pandemic.

ANTIMICROBIAL
News:
 2020:

Page 170 of 719

 → “One Health Global Leaders Group on Antimicrobial Resistance” launched by:
 Food and Agriculture Organization (FAO)
 World Organisation for Animal Health (OIE)
 WHO.
→ Centre for Science and Environment (CSE) report on antibiotic usage in India’s dairy sector.
 2021:
→ In recent years, there is increasing evidence for failure of artemisinin-based combination therapy for falciparum
malaria either alone or with partner drugs.
→ Recent study described presence of two mutations responsible for artemisinin resistance in Northern Uganda.
→ Current artemisinin resistance in East Africa is matter of great concern because this is only drug that saved several
lives across globe.
 2022:
→ Lancet publishes Global Research on Antimicrobial Resistance (GRAM) report.
→ Health ministers from G7 recognise antimicrobial resistance as bigger threat to low- and middle-income countries
(LMIC) even though fighting it is shared responsibility. G7 proposed plan:
 To establish new international integrated surveillance systems.
 Improve existing systems to monitor AMR and antibiotics use among humans, animals, plants and effect on
environment.
 Enhance scientific basis to inform risk assessments and identify opportunities for mitigation.
 To promote prudent and appropriate use of antimicrobials through 2023 by defining national measurable targets
on AMR in line with domestic authorities, including antibiotic usage in human health.
 To prepare upcoming report on infection prevention and control and present it at World Health Summit in Berlin
in 2022.
→ WHO releases 1st-ever report on pipeline of vaccines currently in development to prevent infections caused by
antimicrobial-resistant (AMR) bacterial pathogens. This WHO’s analysis points to need to accelerate trials for AMR
related vaccines in late-stage development and maximise use of existing vaccines.
About:
 What:
→ Antimicrobial is agent that kills microorganisms or stops their growth.
 Classification:
→ Antimicrobial medicines can be grouped according to microorganisms they act primarily against. For example,
antibiotics are used against bacteria, and antifungals are used against fungi. They can also be classified according to
their function. Agents that kill microbes are microbicides, while those that merely inhibit their growth are called
bacteriostatic agents.
 Feature:
→ Use of antimicrobial medicines to treat infection is known as antimicrobial chemotherapy, while use of antimicrobial
medicines to prevent infection is known as antimicrobial prophylaxis.
 Example:
→ Main classes of antimicrobial agents are disinfectants (non-selective agents, such as bleach), which kill wide range of
microbes on non-living surfaces to prevent spread of illness, antiseptics (which are applied to living tissue and help
reduce infection during surgery), and antibiotics (which destroy microorganisms within body).
 Antibiotic:
→ Term "antibiotic" originally described only those formulations derived from living microorganisms but is now also
applied to synthetic agents, such as sulfonamides or fluoroquinolones. Though this term used to be restricted to
antibacterials, its context has broadened to include all antimicrobials. Antibacterial agents can be further subdivided
into bactericidal agents, which kill bacteria, and bacteriostatic agents, which slow down or stall bacterial growth. In
response, further advancements in antimicrobial technologies have resulted in solutions that can go beyond simply
inhibiting microbial growth.
 Antimicrobial Resistance (AMR) / Drug Resistance / Resistance to Drug:
→ What:
 Ability of microorganism - bacteria, viruses, some parasites - to stop antimicrobial - antibiotics, antivirals,
antimalarials - from working against them. It happens when microbe change and become resistant to
anitibiotics.
 AMR occurs when microbes evolve mechanisms that protect them from effects of antimicrobials. This makes
infections harder to treat. All classes of microbes can evolve resistance. Fungi evolve antifungal resistance.
Viruses evolve antiviral resistance. Protozoa evolve antiprotozoal resistance, and bacteria evolve antibiotic
resistance. Those bacteria that are considered extensively drug resistant (XDR) or totally drug-resistant (TDR)
are sometimes called "superbugs".
→ Feature:
 Although antimicrobial resistance is naturally-occurring process, it is often results of improper usage of drugs
and management of infections.

Page 171 of 719

  Antimicrobial resistance is natural process.
→ Cause:
 Overuse leads to mutation. Example – overuse of Artemisinin-based antimalarial drugs had led to mutations in
P. falciparum causing Antimalarial drug resistance.
 Over prescribing of antibiotics.
 Patients not taking antibiotics as prescribed.
 Unnecessary antibiotics used in agriculture.
 Over-use of antibiotics in livestock and fish farming.
 Poor infection control in hospitals, clinics.
 Poor hygiene and Poor sanitation practices.
 Lack of rapid laboratory tests.
 Lack of new antibiotics being developed.
 Taking incorrect doses of antibiotics to cure diseases; Using antibiotics in livestock farming; Multiple chronic
diseases in some people.
→ Impact:
 Standard treatments become ineffective and infections persist. Greater number of AMR deaths. Routine
treatment becomes riskier to perform. Economic loss.
→ AMR - silent threat of future:
 Antibiotics are now becoming ineffective. Many infectious diseases have ceased to respond to antibiotics.
 Misuse of antibiotics in humans, animals is accelerating Antimicrobial resistance process.
 Many infections - tuberculosis, pneumonia, gonorrhea - are becoming very difficult to treat because antibiotics
used for their treatment are becoming less effective.
 Globally, use of antibiotics in animals is expected to increase many folds. Thus, resistance to antibiotics in germs
is man-made disaster.
 Irresponsible use of antibiotics in human health, animal health, fisheries, agriculture.
 Complex surgeries - organ transplantation, cardiac bypass – may become difficult because of untreatable
infectious complications that may result post-surgery.
→ Concern:
 Nearly 7 lakh people die of AMR every year. Toll may rise to as many as 10 million by 2050 and eat up 3.8% of
annual global GDP.
→ Initiative:
 India:
• National Programme on AMR containment: GoI launched it in 2012.
• AMR Surveillance and Research Network (AMRSN): GOI launched it in 2013.
• National Action Plan on AMR: GOI launched it in 2017.
• Red Line campaign to curb over-the-counter use of antibiotics.
• Chennai Declaration [2012] recommendations of roadmap - to tackle challenge of antimicrobial resistance.
 Global:
• EU banned preventive mass medication in animals using antibiotics or other drugs.
• UN: One Health Approach.
• WHO: AWARE classification of antibiotics.
 India:
→ Antibiotic usage in India’s dairy sector:
 Intro:
• India is world’s largest milk producer.
 Why:
• Farmers indiscriminately use antibiotics to treat dairy animal diseases - mastitis (infection / inflammation of
udder) - common ailment in dairy animals.
• Abused antibiotics — despite existence of law against it — are easily available in market.
 Concerns:
• Misuse of antibiotics in dairy sector.
• Antibiotics used in dairy animals may finally reach humans esp. children, through diet - milk etc.
• Antibiotic resistance which could lead to ineffective of most powerful anitibiotic drugs.
• Presence of antibiotic residues are not tested before consumers consume dairy products.
 Significance:
→ Antibiotics saved millions of lives till date.
 Way Forward:
→ Carry out Molecular Malaria Surveillance to find out drug-resistant variants so that corrective measures can be
undertaken.
Note:
 Global Research on Antimicrobial Resistance (GRAM) report:
Page 172 of 719
 → published by Lancet
→ comprehensive estimate of global impact of antimicrobial resistance (AMR)
→ Highlights:
 About 1 million people died in 2019 as direct result of AMR.
 AMR is now leading cause of death worldwide, higher than HIV/AIDS or malaria.
 About 50 lakh deaths were indirectly caused by drug-resistant infection, but resistance itself may or may not
have been direct cause of death.
→ Pathogens analyzed:
 Of 23 pathogens studied, drug resistance in 6 (E coli, S aureus, K pneumoniae, S pneumoniae, A baumannii, P
aeruginosa) led directly to about 10 lakh deaths.
 One pathogen-drug combination – methicillin-resistant S aureus (MRSA) – directly caused about 1 lakh deaths.
 Resistance to 2 classes of antibiotics often considered 1 st line of defence against severe infections –
fluoroquinolones, beta-lactam antibiotics – accounted for about 70% of deaths caused by AMR.
 WHO report on vaccines to prevent infections caused by antimicrobial-resistant (AMR) bacterial pathogens [2022]:
→ In 2022, WHO released 1st-ever report on pipeline of vaccines in development to prevent infections caused by
antimicrobial-resistant (AMR) bacterial pathogens. This WHO’s analysis pointed to need to accelerate trials for AMR
related vaccines in late-stage development and maximise use of existing vaccines.
 Highlight:
• Silent pandemic of antimicrobial resistance is of major growing public health concern (resulting in death of
nearly 5mn people yearly).
• Vaccines are still effective against Pneumococcal disease (Streptococcus pneumonia), Hib (Haemophilus
influenzae type b), Tuberculosis (Mycobacterium tuberculosis), Typhoid fever (Salmonella Typhi).
• Need for more effective vaccine: Current Bacillus Calmette-Guerin (BCG) vaccines against tuberculosis (TB)
do not adequately protect against TB, therefore development of more effective vaccines against TB should
be accelerated.
 Recommendation:
• Equitable and global access to vaccines that already exist.
• Disruptive approaches are needed: Lessons from Covid 19 vaccine development and mRNA vaccines offer
unique opportunities to explore for development of vaccines against bacteria.
• Need to overcome challenges: Such as pathogens associated with hospital-acquired infections (HAI),
difficulty in defining target population(s) among all admitted hospital patients; cost and complexity of
vaccine efficacy trials; and lack of regulatory and / or policy precedent for vaccines against HAIs.
• Easier regulatory requirement: Vaccine development is expensive, and scientifically challenging, and is
associated with high failure rates, and therefore, there is need for support from government and private
sector.
Question:
 Reasons for occurrence of multi-drug resistance in microbial pathogens in India are:
→ Taking incorrect doses of antibiotics to cure diseases.
→ Using antibiotics in livestock farming.
→ Multiple chronic diseases in some people.
Mains link:
 Antibiotic resistance is one of the biggest health challenges of 21st century. Examine why.

BOUNDARY DISPUTE / BORDER DISPUTE [INTER STATE / INTER-STATE]

News:
 2018:
→ Violence occurred when Mizo students’ union built wooden rest house for farmers on land claimed by
Assam, and which was demolished by Assam Police.
 2021:
→ Abandoned houses along Assam-Mizoram border burned down by unidentified persons. It fuelled tension
along volatile inter-state border of Assam and Mizoram. Both States accused each other of encroaching on
their respective territories.Police forces of both States exchanged fires.
→ Chief Ministers of Assam, Mizoram sought to ease tensions along border.
→ To solve Assam-Mizoram border dispute and to arrive at permanent solution, Union asked North Eastern Space
Application Centre (NESAC) to map and demarcate State boundaries using satellite imaging.
→ Chief Ministers of Assam, Mizoram sought to ease tensions along border.
 2022:
→ Home Minister is expected to seal final agreement to end dispute in 6 areas of Assam-Meghalaya boundary.
→ Southern Angami Public Organisation (SAPO) (one tribal body of Nagaland) announces bandh in March
2022 over Manipur’s failure in withdrawing armed personnel and permanent structures from disputed
Kezoltsa area / Kezol–tsa Forest.

Page 173 of 719

  Impact: National Highway-2, which connects two States and is lifeline for Manipur, runs through Kezol–tsa
Forest area. This bandh is likely to cause inconvenience to travellers to / from Manipur and transportation of
essential commodities to Manipur State.
→ Assam and Meghalaya partially resolved their 50-year-old border dispute in 6 of 12 sectors along their 885-
km boundary. Both States signs historic agreement for closure in 6 disputed sectors.
→ Chief Ministers of Arunachal, Assam decide to form district-level committees for settling their inter-State
boundary disputes. [Earlier, union government approv ed one agreement to partially resolve disputed
sectors on Assam-Meghalaya border].
→ CMs of Assam and Arunachal agree to realign border based on 1960 papers. They jointly issue ‘Namsai
Declaration’. Boundary line delineated in 1960 by one committee will be basis for realignment of Assam
and Arunachal interstate boundary as two States attempt to solve their longstanding border disputes. Both
States have been involved in dispute over 123 villages.
About:
 Assam - Arunachal Border Dispute / Arunachal - Assam Border Dispute:
→ What:
 Arunachal and Assam have disputes at about 1,200 points along their 804 km boundary.
→ Background:
 Present-day Arunachal, attained its Statehood in 1987, used to be North East Frontier Tract, administered by
Governor of Assam as one agent of President of India. It was renamed North East Frontier Agency and brought
under Central government’s control in 1954.
Assam has boundary disputes with all NE States that were carved out of it. In 1972, Arunachal was
carved out of Assam, as Union Territory. In 1987, Arunachal became full-fledged State. Arunachal does not
accept this “constitutional boundary” that it says was dictated by partisan administration of undivided Assam
without consulting tribal stakeholders. This issue with Arunachal has more to do with one 1951 report prepared
by one sub-committee headed by Assam’s 1st Chief Minister, Gopinath Bordoloi.
→ Efforts:
 Supreme Court appointed one local boundary commission in 2006 headed by its one retired judge. In its 2014
report, this commission recommended that Arunachal should get back some of areas transferred in 1951 besides
advising both States to find middle path through discussions. This did not work out.
 In 2022, Chief Ministers of Arunachal, Assam decided to form district-level committees for settling
their inter-State boundary disputes.
 In 2022, CMs of Assam and Arunachal agreed to realign border based on 1960 papers. They jointly
issued ‘Namsai Declaration’. Boundary line delineated in 1960 by one committee will be basis for
realignment of Assam and Arunachal interstate boundary as two States attempt to solve their
longstanding border disputes. Both States have been involved in dispute over 123 villages.
→ Namsai Declaration [2022]:
 This declaration is signed between Assam and Arunachal on July 15, 2022, at Namsai, Arunachal to
minimize border dispute between two States in r espect of 123 villages. This declaration says boundary
line delineated and signed on 29 toposheets by High -Powered Tripartite Committee as notified
boundary during year 1960 would be taken as basis for realignment of boundary by both States. Both
States decided to constitute 12 “regional committees”, each covering 12 districts of Arunachal and
counterpart districts of Assam for joint verification of 123 villages. They will make their
recommendations to respective governments keeping in view historical persp ective, administrative
convenience, contiguity and people’s will to delineate interstate boundary.
Both CMs agreed in principle regarding 37 villages. Final decision will be made based on
recommendations of regional committees. 28 villages, which are with in constitutional boundary of
Arunachal, will remain with it. 3 villages, on which claims were withdrawn by Arunachal, will remain
with Assam. Locations of 6 villages could not be located in Assam and if they exist in Arunachal, they
will continue to be with it. It was also agreed upon that regional committees will submit their 1 st
tranche of reports on areas where consensus is arrived at before 15 Aug 2022.
 Assam - Mizoram Border Dispute / Mizoram - Assam Border Dispute:
→ History:
 Assam, Mizoram share about 160 km volatile border. And, conflict is decades-old.
 During British era, Mizoram was known as Lushai Hills and was one district of Assam.
 British tea plantations started in Cachar plains, Barak Valley during mid-19th century. Their expansion led to
problems with Mizos, living in Lushai Hills.
 Border dispute between Assam and Mizoram rooted from 2 British era notifications:
• 1875 notification (Bengal Eastern Frontier Regulation Act, 1873) that differentiated Lushai Hills from Cachar
plains.
• 1933 notification that demarcated boundary between Lushai Hills and Manipur (princely State).
 In 1972, Mizoram was carved out of Assam, as Union Territory. In 1987, Mizoram became full-fledged State.

Page 174 of 719

  Mizoram does not accept this “constitutional boundary” that it says was dictated by partisan administration of
undivided Assam without consulting tribal stakeholders.
 Assam and Mizoram have quarrelled over this inter-state border, of about 160 km long, and sometimes leading
to violent clashes.
→ Claims / Arguments:

{Assam} {Mizoram}
Based on 1933 notification, Assam claims that Based on 1875 notification, Mizoram claims that
disputed land is theirs. disputed land is theirs. Mizoram do not accept
1933 notification. Mizoram says 1875 boundary
was drawn in consultation with their chiefs.
→ After independence:
 Assam and Mizoram signed agreement to maintain status quo in no man’s land in border area.
→ Immediate cause:
 Violatation of status quo – as agreed upon between State governments of Assam and Mizoram - in no
man’s land.
• Reason: Disputed border is imaginary line that changes with natural obstacles - rivers, hills, valleys, forests.
According to people of Assam and Mizoram, border between them is not-so-clear boundary. Hence, people
living in border areas cross over to other side because they are not fully aware of border demarcation.
→ Impact:
 Locals in Assam blocked National Highway-306, uprooted part of lone railway track connecting
Mizoram. Transportation of people and goods to and from Mizoram has thus been affected.
→ Way Forward:
 Supreme Court should be approached for solution.
 CRPF should patrol and monitor region, under direct supervision of Union government.
 Avoid posting sensitive messages
 Make judicious use of social media platform to prevent any possible escalation of situation.
 Assam - Meghalaya Border Dispute / Meghalaya - Assam Border Dispute:
→ Background:
 Assam and Meghalaya share 885-km-long border. Meghalaya was carved out of Assam under Assam
Reorganisation Act, 1971. Assam Reorganisation Act, 1971 law was challenged, leading to dispute. As
of now, there are 12 points of dispute along their borders [6 of which are solved in 2022 between
Assam and Meghalaya Govts.].
→ Langpih:
 This district in West Garo Hills (Meghalaya) bordering Assam is major point of contention between
Assam and Meghalaya. Langpih was part of Assam during British colonial period. But post -
Independence, it became part of Garo Hills (Meghalaya). Assam considers it to be part of Mikir Hills in
Assam. Meghalaya questioned Blocks I and II of Mikir Hills -now Karbi Anglong region – being part of
Assam. Meghalaya says these were parts of erstwhile United Khasi and Jaintia Hills.
→ Efforts to solve dispute:
 Both Assam and Meghalaya constituted border dispute settlement committees.
 Assam Chief Minister and Meghalaya CM decided to set up 2regional committees to resolve border
disputes in phased manner.
 Meghalay’s CM said 5 aspects were to be considered in resolving border dispute: historical facts,
ethnicity, administrative convenience, mood and sentiments of people concerned, contiguity of land.
 In 2022, Assam and Meghalaya partially resolved their 50 -year-old border dispute in 6 of 12 sectors
along their 885-km boundary. Both States signs historic agreement for closure in 6 disputed sector s,
though main contention Langpih was not included.
 Manipur – Nagaland Border Dispute / Nagaland - Manipur Border Dispute:
→ Kezol–tsa Forest:
 Dispute in Kezol–tsa Forestarea is about old land ownership dispute between 3 Naga tribes —Angamis
of Nagaland, and Maos and Marams of Manipur. Kezol–tsa has been center stage of dispute between
Mao Council of Manipur and Southern Angami Public Organization (SAPO) of Nagaland. Both parties
have been stalking claim for Kezol–tsa forest and Dzuko Valley for many years. Both Marams and Maos
claims it belongs to Manipur’s Senapati district. Angamis of Nagaland say it is part of Angami tribal
ancestral land, and was “unfairly” made part of Manipur by British.
 In 2001, one rest house constructed by SAPO at Kezol –tsa was destroyed by suspected Songsong
villagers and this led to tension between Mao people and Southern Angamis. On enquiry made by
Council of Mao, it was found that some youths from Songsong village had destroyed that rest house
and written report was informed by Council of Mao to SAPO. During this relevant time of tension, one
authority intervened and directed defaulters (Songsong village) to reconstruct rest house of Southern

Page 175 of 719

 Angamis. Destroyed rest house was re-constructed to its original shape by Songsong village. This
calmed the situation and Southern Angami ownership of Kezol –tsa and Dzuko is undisturbed until
tensions rose again in 2015.
→ Dzukou Valley:
 It is spread over Nagaland and Manipur. It has traditionally been bone of contention between Mao
Nagas of Senapati (Manipur) and Southern Angami Nagas of Kohima (Nagaland). There has been
disputes for years between Manipur and Nagaland regarding ownership of Dzuko Valley. Historically,
this valley is extent of territory of Viswema village under present-day Nagaland but today it is jointly
preserved with Southern Angami Public Organization (SAPO), Nagaland. However, politically, this
valley shares both Manipur and Nagaland State territories which majority of area falls under Manipur
State boundary, according to map of Survey of India.
→ Way Forward:
 Claim that entire Dzukou Valley belongs to Nagaland is made by Southern Angami Public Organisation
(SAPO), not by Nagaland State.
 If need arises, Centre may play part of mediator in resolving this issue.
Note:
 Why Assam has many border disputes?
→ Assam has border disputes with many States. States of NE were largely carved out of Assam. Assam’s
border disputes with Arunachal, Nagaland are pending in Supreme Court. Assam’s border disputes with
Meghalaya, Mizoram are currently in resolution through negotiations. Assam – Mizoram border dispute
recently turned violent, leading to intervention from Centre.
 Inter-state border disputes in India (according to Union govt.):
→ Assam-Arunachal; Assam-Nagaland; Assam-Meghalaya; Assam-Mizoram; Haryana-HP; Ladakh-HP; MH-
Karnataka.
 In 1950, Constitution contained 4-fold classification of States of Indian Union: Part A States, Part B States, Part C States,
Part D States.
 Kezoltsa area / Kezol–tsa Forest:
→ One thick forest along southern and northern edges of Nagaland and Manipur, on periphery of picturesque
Dzukou Valley, bordering Nagaland and Manipur. It is located on southern part of Dzuko Valley. This forest
has dry, warm summers, and cool winter. Accumulation of snow during winter i s common and can stay on
ground for many days. Some threats to this include logging, changing fire regimes, climate change. It has
diverse species of trees.Animals found are deer, etc. Kezoltsa is not part of Dzukou Valley.
 States Reorganisation Act, 1956:
→ What:
 Act to provide for reorganisation of States of India. major reform of boundaries of India's States and
territories, organising them along linguistic lines. Although additional changes to India's State
boundaries were made since 1956, States Reorganisation Act, 1956 remains single most extensive
change in State boundaries since independence of India.
Value Addition:
 In 1873, British government introduced inner-line regulation vaguely separating plains from frontier hills that were later
designated as NE Frontier Tracts in 1915.
Mains Link:
 Suggest measures to end the Assam- Mizoram border dispute.
 Discuss the key features of the States Reorganisation Act, 1956.

BIOMASS
News:
 2019:
→ Then SBI chairman said no future for gas-based power plants in India, in reply to Parliamentary Standing Committee
on Energy.
 2021:
→ Ministry of Power to set up National Mission on use of Biomass in coal based thermal power plants .
 2022:
→ CAQM reviews progress of Biomass Co-firing.Though some progress has been made towards co -firing,
CAQM finds progress not up to desired levels.
→ SAMARTH in collaboration with NTPC organizes workshop in Chandigarh on Biomass use in thermal power
plants to promote and facilitate ex-situ utilization of agri-residue for co-firing in thermal power plants.
About:
 SAMARTH / National Mission on Use of Biomass in Thermal Power Plants:
→ What:
 Sustainable Agrarian Mission on use of Agro Residue in Thermal Power Plants. SAMARTH was launched
by Ministry of power and mandates all thermal power plants in India use 5-10% of biomass alongside
Page 176 of 719
 coal to produce power. Consequently, it promotes research on modern boilers which can handle
greater amount of silica and alkalis in biomass pellets.
 It can be regarded as policy for Biomass Utilisation for Power generation.
→ Need:
 To address air pollution due to farm stubble burning. To reduce carbon footprints of thermal power
generations.
→ Objective:
 To increase level of biomass co-firing from present 5% to higher levels [to get larger share of carbon
neutral power generation from thermal power plants].
 To take up R&D in boiler design [to handle higher amount of silica, alkalis in biomass].
 To facilitate supply chain of bio mass, agro-residue and their transports upto power plants.
 To address govt. regulatory issues in biomass co -firing.
→ Implementation:
 Steering Committee: Power secretary – head; representative from ministry of petroleum & natural gas
(MoPNG); representative from ministry of new & renewable energy (MNRE); ……
 Executive Committee.
 NTPC – will provide logistic, infrastructure support.
→ Significance:
 No pollution, only income from agro-residue.
 Power generation from Agro-residue.
 Income by selling Agro-residue.
 Clean and healthy environment.
→ Fact:
 Crop residue to electricity: Crop residue / biomass -> Bales -> Pellets -> Power plant.
 Economics and risk management: From generator perspective, economics of biomass pellets co -firing
depends on many key factors – avoided cost of coal; revenue from sale of renewable energy
certificates; cost of biomass pellets; increased operating and maintenance (O&M) costs; capital cost
associated with co-firing. Overall, generators see need to balance benefits of co -firing against risks to
their core business.
→ Challenges:
 Maintain of supply chain of biomass pellets.
 Quality of Biomass pellet gets deteriorated because of moisture.
 Safe unloading of biomass pellet.
 Integration facilities for Handling & Co-firing with existing system.
 Fire possibilities during pulverizing.
 Biomass Cofiring / Biomass Co-firing [in say Coal Power Plants]:
→ What:
 combustion of biomass materials with other fuels - natural gas, coal, waste-derived fuels etc. - within
boiler
→ Benefits:
 Industrial benefits: Conservation of natural resources; GHG reduction; Cost savings in ash handling;
Reduction in O&M cost for SO2 emission control devices; Energy recovery from waste.
 Environmental benefits: Significant reduction in SO2, NOx and PM emissi ons; Improvement in Ambient
Air Quality; Maintaining soil fertility of fields.
 Societal benefits: Employment opportunities in rural areas; Enhancing income of farmers;
Opportunities for new business for farmers; Development of entrepreneurial skills; Generating rural
employment.
 Decreases use of fossil fuels for energy generation and hence mitigates greenhouse gas (GHG)
emissions.
 It does not increase much costs and infrastructure investments, than current procedures.
 Relative easier implementation
 Reduction of CO2, other pollutant (SOx, NOx) emissions into atmosphere.
 No significant loss in total boiler efficiency.
 Cofiring biomass with waste-derived fuels results in environmentally friendly destruction of waste fractions,
cost-effective heat and power production.
 co-firing biomass with coal results in less sulfur emissions than burning coal by itself.
Note:
 Co-firing / Cofiring:
→ What:

Page 177 of 719

 combustion of two (or more) different types of materials at same time. Cofiring is term used to describe
incorporating secondary fuel with primary fuel utilizing same combustion equipment. One common application
of cofiring is used in coal-fired power plants where coal use is supplemented with biomass.
→ Advantage:
 One advantage is that existing plant can be used to burn new fuel, which may be cheaper or more
environmentally friendly. For example, biomass is sometimes co-fired in existing coal plants instead of new
biomass plants.Another example is that biomass primary fuel fractions can be cofired with waste-derived fuels
in biomass plants leading to environmentally friendly destruction of waste fractions and cost-effective heat and
power production.
 Co-firing can also be used to improve combustion of fuels with low energy content. For example, landfill gas
contains large amount of carbon dioxide (CO2), which is non-combustible. If landfill gas is burned without
removing carbon dioxide (CO2), equipment may not perform properly or emissions of pollutants may increase.
Thus, co-firing landfill gas with natural gas or biomassincreases heat content of landfill gas fuel and improves
combustion and equipment performance.
 Also, co-firing can be used to lower emission of some pollutants. For example, co-firing biomass with coal results
in less sulfur emissions than burning coal by itself.
Mains Link:
 Write a note on biomass Cofiring.
 Do you think the future belongs to gas based plants in India?

METROLOGY
News:
 2021:
→ Importers of medical devices, used particularly for providing oxygen support to COVID-19 patients, are now allowed
to import these medical devices without prior mandatory declaration.
 Reason: Legal Metrology (Packaged Commodities) Rules, 2011 mandates importers to get prior approval before
importing. But, considering pandemic situation of COVID-19 to meet demands of medical devices, Central
Government has given permission.
 2022:
→ Centre (Department of Consumer Affairs, Min. of Consumer Affairs) amends Legal Metrology (Packaged
Commodities) Rules, 2011 for ease of doing business and reducing compliance burden for electronic industries. This
2022 amendment will allow electronic industry to declare information in digital form through QR Code. In specific,
Department of Consumer Affairs vide Legal Metrology (Packaged Commodities), (2nd Amendment) Rules, 2022 has
allowed electronic products to declare certain mandatory declarations through QR Code for period of 1 year, if not
declared in package itself.
About:
 What:
→ It means related to measurements. Metrology is scientific study of measurement. It establishes common
understanding of units, crucial in linking human activities.
 Genesis:
→ Modern metrology has its roots in French Revolution's political motivation to standardise units in France when length
standard taken from natural source was proposed. This led to creation of decimal-based metric system in 1795,
establishing set of standards for other types of measurements. Several other countries adopted metric system
between 1795 and 1875; to ensure conformity between countries, International Bureau of Weights and Measures
(BIPM) was established by Metre Convention, 1875. This has evolved into International System of Units (SI) as result
of one resolution at 11th General Conference on Weights and Measures (CGPM) in 1960.
 Metre Convention, 1875 / Treaty of Metre, 1875:
→ What:
 international treaty that created International Bureau of Weights and Measures (BIPM), intergovernmental
organization under authority of General Conference on Weights and Measures (CGPM) and supervision of
International Committee for Weights and Measures (CIPM), that coordinates international metrology and
development of metric system.
 India – member.
→ Aim:
 To set framework for collaboration in science and measurements globally.
 India:
→ Initiative:
 Legal Metrology Act, 2009.
Note:
 Legal Metrology Act, 2009:
→ What:

Page 178 of 719

  Act to establish and enforce standards of weights and measures, regulate trade and commerce in weights,
measures and other goods which are sold or distributed by weight, measure, or number.
 It is India’s legal requirements about measurements, and measuring instruments.
 Ministry of Consumer Affairs.
→ Objective:
 to ensure public guarantee about security and accuracy of weighs and measurements.
→ Legal Metrology (Packaged Commodities), Rules 2011:
 It was issued, in relation to this Act, so that consumers can make informed choices by informing consumers
about essential declarations on pre-packed commodities.
 Legal Metrology (Packaged Commodities), (2nd Amendment) Rules, 2022:
• What:
 It amends Legal Metrology (Packaged Commodities) Rules, 2011 for ease of doing business and
reducing compliance burden for electronic industries. This 2022 amendment will allow electronic
industry to declare information in digital form through QR Code. It allows electronic products to declare
certain mandatory declarations through QR Code for period of 1 year, if not declared in package itself.
• Highlight:
 Elaborated information through QR Code: This 2022 amendment will allow electronic industry to
declare elaborated information in digital form through QR Code.
 Important declarations to be declared effectively: It will allow important declarations to be declared
effective on label in package while other descriptive information can be conveyed to Consumer through
QR Code.
 Greater use of technology: Enabling greater use of technology in this digital era to declare mandatory
declaration through QR Code which can be scanned to view declarations like address of manufacturer
or packer or importer, common or generic name of commodity, size and dimension of commodity and
customer care details except for telephone number & email address.
 Mandatory declaration: Earlier, all prepackaged commodities including electronic products were
required to declare all mandatory declarations as per Legal Metrology (Packaged Commodities), Rules
2011 on package.
 World Metrology Day:
→ What:
 20 May. Annual event celebrating International System of Units. This date is anniversary of signing of Metre
Convention, 1875. World Metrology Day project is currently organized jointly by International Bureau of Weights
and Measures (BIPM) and International Organization of Legal Metrology (OIML).
→ 2022 World Metrology Day:
 2022 Theme: Metrology in Digital Era.
Question:
 With reference to Legal Metrology Rules, Department of Consumer Affairs administers Legal Metrology laws; and Legal
Metrology (Packaged Commodities), Rules 2011 are primarily intended to ensure that consumers are able to make
informed choices by being informed of essential declarations on pre-packed commodities.
Mains Link:
 All the prepackaged commodities including the electronic products are required to declare all the mandatory declarations
as per the Legal Metrology (Packaged Commodities), Rules 2011. Critically analyze.

ACCOUNTING SYSTEM
About:
 2022:
→ Government Accounting Standards Advisory Board (GASAB), CAG of India releases one concept paper on
NRA – “Natural Resource Accounting – Concept and implementation in India - with emphasis on preparation of Asset
Accounts on Mineral & Energy Resources in States”.
About:
 What:
→ It is one set of accounting processes with integrated procedures and controls. Its intent is to record
business transactions, summarize those transactions into aggregated form, and create reports that can be
used by decision makers to monitor, analyze, and improve operations.
 Natural Resource Accounting (NRA):
→ What:
 According to OECD, NRA is one accounting system that deals with stocks and stock changes of natural assets,
comprising biota (produced or wild), subsoil assets (proved reserves), water and land with their aquatic and
terrestrial ecosystems. It is frequently used in sense of physical accounting as distinguished from monetary
(environmental) accounting.
→ Aim:

Page 179 of 719

  To provide information on state of natural resources and changes affecting them. It is therefore one important
link in chain of sustainable development.
→ Efforts in India:
 Green National Accounts in India - Framework (MoSPI);
 EnviStats India 2018-19 (MoSPI);
 NCAVES (MoSPI).
 Action Plans divided into 3 pronged goals (Short term goals, Mid-term goals, Long term goals) (2020-30)
(CAG/GASAB).
 Creation of NRA Cells.
Note:
 Government Accounting Standards Advisory Board (GASAB) [2002]:
→ What:
 CAG constituted GASAB with support of GOI through one notification. This decision was taken in backdrop of
new priorities emerging in Public Finance Management and to keep pace with International trends. New
priorities focus on good governance, fiscal prudence, efficiency & transparency in public spending.
Accounting systems, are being revisited with emphasis on transition from rule to principle based
standards and migration from cash to accrual based system of accounting. GASAB, as nodal advisory body in
India, is taking similar action to formulate and improve standards of government accounting and financial
reporting and enhance accountability mechanisms.
→ Mission:
 To formulate and recommend Indian Government Accounting Standards (IGASs) for cash system of accounting.
→ Composition:
 GASAB has high level representation from important accounting heads in Government, Ministry of Finance,
Department of Post, Finance Secretaries of States, RBI and heads of premier accounting & research
organizations.
 Chairperson - Deputy CAG (Government Accounts).
 Natural Resource Accounting – Concept and implementation in India - with emphasis on preparation of Asset Accounts
on Mineral & Energy Resources in States:
→ What:
 It is one concept paper on NRA released by GASAB, CAG of India in 2021.
→ Aim:
 It aims to help make policymakers take informed policy decisions about India’s key natural resources.
 It will be in compliance with international standards set by UN System of Environmental-Economic Accounting
Central Framework / UN SEEA CF.
→ Concept:
 This paper says that one of most crucial element of Sustainable Development (SD) is that it provides outline of
resource bases, pace of usage with eye on their sustainability and embeds environmental aspects into economic
indices. NRA broadly contains 3 steps: Physical Accounting; Monetary Valuation; Integration with Economic
Accounting. Idea is to quantify adverse impact of economic development on environment and adjust / reduce it
from GDP to arrive at Green GDP, essentially signifying impact of economic development on environment and
sustainable growth. Below figure is relation between Economy and Environment:


 System of Environmental-Economic Accounting (SEEA):
→ What:
 SEEA measures environment and its relationship with economy. SEEA is one framework that integrates economic
and environmental data to provide more comprehensive and multipurpose view of interrelationships between
economy and environment and stocks and changes in stocks of environmental assets, as they bring benefits to
humanity. It contains internationally agreed standard concepts, definitions, classifications, accounting rules and
tables for producing internationally comparable statistics and accounts. SEEA framework follows similar
accounting structure as System of National Accounts (SNA). SEEA framework uses concepts, definitions and
classifications consistent with SNA in order to facilitate integration of environmental and economic statistics.
SEEA is one multi-purpose system that generates wide range of statistics, accounts and indicators with many

Page 180 of 719

 different potential analytical applications. It is one flexible system that can be adapted to countries' priorities
and policy needs while at same time providing common framework, concepts, terms and definitions.
→ SEEA Central Framework:
 One international statistical standard for measuring environment and its relationship with economy. This Central
Framework covers measurement in 3 main areas:
• Environmental flows: Flows of natural inputs, products and residuals between environment and economy,
and within economy, both in physical and monetary terms.
• Stocks of environmental assets: Stocks of individual assets, such as water or energy assets, and how they
change over accounting period due to economic activity and natural processes, both in physical and
monetary terms.
• Economic activity related to environment: Monetary flows associated with economic activities related to
environment, including spending on environmental protection and resource management, and production
of ‘environmental goods and services’.
 It is latest international framework for economic-environmental accounting.

FINANCIAL INSTRUMENT
News:
 2021:
→ During 2020 Covid-19 pandemic, States / Union Territories increased their borrowings via State
government securities i.e. SDLs.
→ RBI allows retail investors to directly open their gilt accounts with RBI, and trade in government securities.
→ RBI launched retail direct scheme.
→ RBI plans to enable international settlement of transactions in government securities (G -secs) through
International Central Securities Depository (ICSD):
 This proposal would expand investor base for G-secs market
 Once operationalised, this will enhance access of non-residents to G-secs market, inclusion of Indian G-secs in
global bond indices.
→ Investments through P-Notes in domestic capital market is rising up and this increase in P-notes has
alarmed regulators.
→ Paytm’s stock rises in grey market, following Paytm’s announcement that it will offer IPO.
→ SEBI directs stock exchanges in commodity derivatives segment to suspend trading in derivative contracts
in key farm commodities [paddy (non-basmati), wheat, chana, mustard seeds, soya bean, crude palm oil,
moong]. [Suspension of futures trading in agri products]
 Reason:
• To check rising prices of said essential commodities which is fuelling inflation. Because India is world’s
biggest importer of vegetable oils, this SEBI suspension measure will make difficult for edible oil importers
and traders to transact business since they use Indian exchanges to hedge their risk.
• Speculators play role in increasing prices. This needs to be discouraged to curb inflation and support growth
as economy is recovering from COVID-19 impact.
 2022:
→ RBI hikes rates to rein in inflation, which is about 7% now. However, with this hike in interest rate, bond yields have
also risen to their highest levels in some years.
 Impact on market:
• Rise in bone yield means markets have already factored in worst of rate movements.
• Bond Yield rise indicates that cost of funds in financial system is rising and interest rates are rising.
• Bone yield rise means government will have to pay more as yield (or return to investors), leading to rise in
cost of borrowings.
• Bond yield rise will put upward pressure on general interest rates in banking system.
 Impact on Investors:
• Rise in bond yield means investors expect higher interest rates and are selling their bonds, because higher
rates would result in decline in bond price of existing bonds (and thereby capital loss on sale before
maturity).
• Debt investors are set to get impacted. When bond yields rise and bond prices fall, net asset values of debt
funds, which hold sizeable chunk of government securities in their portfolios, will also decline.
• Bond yield rise will also impact corporate bonds, which are priced higher than government bonds.
• Rising bond yields are generally not good news for equity investors as bond yield rise raises cost of funds
for companies and start hurting their earnings.
→ There was one case of front-running in mutual fund business. So, concerned about prospect of similar
activities occurring in future, SEBI is expected to take harsh action, which might include action against top
fund house employees.
→ GOI asks IRDAI to come up with such surety bond, which can replace expensive Bank Guarantees.

Page 181 of 719

 → Ministry of Finance declares Zero Coupon Zero Principal (ZCZP) instruments as securities. That is, GOI has
cleared ZCZP instruments for listing as securities on Social Stock Exchanges (SSE).
→ With US' inflation rate at 9.1%, highest in 40 years, 3 key terms: Yield inversion, soft-landing, reverse
currency war are in news.
About:
 What:
→ monetary contract(s) between parties.
→ International Accounting Standards (IAS) defined financial instrument as any contract that gives rise to
financial asset of one entity and financial liability or equity instrument of another entity.
→ 3 main categories of financial instruments are:
 debt (bonds, mortgages)
 equity (stocks, shares)
 Derivatives
 Feature:
→ It can be created, traded, modified, settled.
 Types:
→ Cash instruments:
 What:
• instruments whose value is determined directly by markets.
• Securities, which are readily transferable
• loans and deposits, where both borrower and lender have to agree on transfer.
 Type:
• Cash (currency), evidence of ownership interest in entity or contractual right to receive or deliver in form
of currency (forex)
• Debt-based (reflecting loan investor made to issuing entity – bonds, loans):
 If Financial Instrument is debt, it can be further categorized into:
o short-term (< one year); or
o long-term.
• Equity-based (reflecting ownership of issuing entity - shares)
→ Derivative instruments / Derivative:
 What:
• instruments which derive their value from value and characteristics of underlining entities / underlying /
underlier like asset, index, currencies, exchange rates, commodities, interest rate.
• In finance, derivative is contract that derives its value from performance of underlying entity / underlying /
underlier. This underlying can be asset, index, interest rate.
 Type:
• Exchange-traded derivatives.
• Over-the-counter (OTC) derivatives.
 Usage:
• Derivatives can be used for insuring against price movements (hedging)
• Derivatives can be used for increasing exposure to price movements for speculation
• Derivatives can be used for getting access to otherwise hard-to-trade assets or markets.
• ….
 Example:
• Futures:
 What:
o Legal agreement between two parties to buy or sell underlying asset at pre-determined future date
and price.
o It is executed directly through regulated and organised exchange.
• Forwards:
 What:
o Legal agreement between two parties to buy or sell underlying asset at pre-determined future date
and price, but through OTC.
o It does not involve regulated and organised exchange. Thus, it carry more counterparty risk for
both parties.
o That is, it is similar to futures contracts except that deal is not made through regulated or organised
exchange.
• Options:
 What:
o Contract that gives trader right but not obligation to buy or sell underlying asset at pre-determined
future date and price.
Page 182 of 719
 • Swaps:
 What:
o Swap is contractual agreement between two parties to exchange cash flows / financial instrument
at future date on pre-planned formula.
o It is OTC contracts and thus not traded on exchanges.
 Type:
o Credit Default Swaps (CDS):
✓ financial swap agreement that seller of CDS will compensate buyer in event of debt default (by
debtor) or other credit event. That is, seller of CDS insures buyer against some reference asset
defaulting. Buyer of CDS makes payments to seller and, in exchange, may expect to receive
payoff if asset defaults.
✓ one party agrees to pay another party periodic fixed payments in exchange for receiving ‘credit
event protection’, in form of payment, in event that 3rd party or its obligations are subject to
pre-agreed adverse credit events over pre-agreed time period.
✓ It is example of credit derivative transaction.
• Credit derivative:
 What:
o instruments and techniques designed to separate and then transfer credit risk or risk of event of
default of corporate or sovereign borrower, transferring it to entity other than lender or
debtholder.
o credit protection is bought and sold
o synthetic securitization process
 Type:
o Unfunded credit derivative:
✓ Credit derivative where credit protection is bought and sold between counterparties without
protection seller having to put up money upfront or during life of deal unless event of default
occurs.
✓ Usually unfunded credit derivative contracts are traded in accordance to International Swaps
and Derivatives Association (ISDA) master agreement.
✓ Most unfunded credit derivatives are credit default swaps.
o Funded credit derivative:
✓ Credit derivative entered into by financial institution or special purpose vehicle (SPV) and
payments under credit derivative are funded using securitization techniques, such that debt
obligation is issued by financial institution or SPV to support these obligation.
✓ In funded credit derivatives, transactions are often rated by rating agencies, which allows
investors to take different credit risk according to their risk appetite.
 Example:
o Synthetic collateralized debt obligations (CDO)
o credit-linked notes
o single-tranche CDOs.
 Note:
• Most derivatives are traded over-the-counter (OTC) (off-exchange) or on exchange like Chicago Mercantile
Exchange.
• Most insurance contracts have developed into separate industry.
• In United States, after financial crisis of 2007–2009, there has been increased pressure to move derivatives
to trade on exchanges.
→ Table:

{INSTRUMENT TYPE}
Securities Other cash Exchange-traded OTC derivatives
derivatives
{ASSET Debt Bills (T-bills etc.), Deposits, Short-term Forward rate
CLASS} (short Commercial Certificates of interest rate agreements
term) paper deposit futures
Debt Bonds Loans Bond futures, Interest rate swaps,
(long Options on bond Interest rate caps and
term) futures floors, Interest rate
options, Exotic
derivatives
Equity Stock N/A Stock options, Stock options, Exotic
Equity futures derivatives

Page 183 of 719

 Foreign N/A Spot foreign Currency futures Foreign exchange
exchange exchange options, Outright
forwards, Foreign
exchange swaps,
Currency swaps
 Financial market:
→ What:
 market in which people trade:
• financial securities (stocks, bonds, etc)
• financial derivatives (commodities - raw materials, precious metals, etc).
at low transaction costs.
 Financial market is often used to refer just to markets that are used to raise finance / fund.
→ Example:
 Exchanges (organizations that facilitate trade in financial instruments):
• stock exchange
• commodity exchange.
Example:
• physical location - New York Stock Exchange (NYSE), London Stock Exchange (LSE), Bombay Stock Exchange
(BSE), etc.
• electronic system – NASDAQ etc.
 Corporate actions (merger, spinoff) are outside exchange, where any two companies or people may
agree to sell stock from one to other without using exchange.
→ Type (based on security type):
 Money market:
• What:
 Financial market that are used to raise short-term finance (short-term loans i.e. < 1 yr).
 Market for dealing with financial assets and securities which have maturity period of up to 1 year.
 It provides short term debt financing and investment.
• Example:
 T-Bills, commercial paper, banker's acceptances, deposits, certificates of deposit, bills of exchange,
repurchase agreements, federal funds, short-lived mortgage- and asset-backed securities.
 Capital market:
• What:
 Financial market that are used to raise long-term finance (> 1yr).
 market for financial assets that have long or indefinite maturity.
 Generally, it deals with long-term securities that have maturity period of > 1 year.
• Feature:
 Financial regulators like SEBI, in India, oversee capital markets to protect investors against fraud, etc.
• Component:
 Stock market / Equity market / Share market:
o What:
✓ market where ownership of securities are issued and subscribed.
✓ Aggregation of buyers and sellers of stocks (shares), which represent ownership claims on
businesses.
✓ One example of secondary equity market for shares is New York (NYSE) stock exchange.
o Feature:
✓ It provides financing through issuance of shares / common stock, and enables stock
subsequent trading.
✓ It includes securities listed on public stock exchange.
✓ It includes stock traded only privately (shares of private companies sold to investors through
equity crowdfunding platforms).
 Bond market /Credit market / Debt market:
o What:
✓ financial market where participants can issue new debt (primary market) or buy and sell debt
securities (secondary market).
✓ market where funds are borrowed and lent.
✓ Arrangements are made so that borrowers agree to pay lender original amount of loan +
interest.
o Feature:
✓ It provides financing through issuance of bonds, and enables subsequent bond trading.
✓ Debt is usually in form of bonds, but debt may include notes, bills etc.
✓ It consists of bonds, bank loans.
Page 184 of 719
 ✓ Its one important part is Government bond market.
 Commodity market:
• What:
 market that trades in primary economic sector - cocoa, fruit, sugar, etc. [and not in manufactured
products]
 Soft commodities (grown commodities – wheat, cocoa, sugar, etc) and hard commodities (mined /
extracted commodiites – gold, oil, gas, gemstones, metals, etc.) are traded here.
• Component:
 physical trading
 derivatives trading
• Ways:
 Futures contracts - oldest way of investing in commodities, spot prices, forwards, options.
• Note:
 Farmers have used simple form of derivative trading in commodity market for centuries for price risk
management.
 Derivatives market:
• What:
 financial market for derivatives
 market where financial instruments are derived and traded based on underlying asset
(commodities, stocks etc).
 It provides instruments for management of financial risk.
• Type:
 exchange-traded derivatives
 over-the-counter (OTC) derivatives.
• Derivative Trading:
 What:
o It is similar to regular sell and buy process. But, instead of paying whole amount up front, trader
pays only initial margin to stockbroker.
o Buyer and seller of derivative contracts / instruments have opposite estimations of future trading
price. Both parties bet on future value of underlying to make profit.
o Derivatives trading takes place when traders speculate on future price of asset through buying or
selling of derivative contracts to maximise profit as compared to buying underlying asset outright.
 Goal:
o ultimate objective is profit.
 Participants:
o Hedgers
o Traders and speculators
o Arbitrageurs
o Margin traders.

{Advantage} {Disadvantage}
Low transaction costs Involves high risk
Derivatives are used in risk management Counterparty risk
(hedging)
Market efficiency Speculative in nature
Determines price of underlying asset
Traders can also go short and make profit
from falling asset prices.
Risk is transferable
 Futures market:
• It provides standardized forward contracts (exchanged traded forward contracts) for trading
products at future date.
 Foreign exchange market / Currency Market:
• What:
 global decentralized or over-the-counter (OTC) market for trading of currencies.
 It facilitates trading of foreign exchange.
• Feature:
 It determines foreign exchange rates for every currency.
 It includes all aspects of buying, selling, exchanging currencies at current or determined prices.
• Participants:
 Main participants are larger international banks.
 Financial centers around world function as anchors of trading between buyers and sellers.
Page 185 of 719
 • Note:
 In terms of trading volume, it is by far largest market in world, followed by credit market.
 Cryptocurrency market:
• It facilitates trading of digital assets and financial technologies.
 Spot market / Cash market:
• What:
 public financial market in which financial instruments or commodities are traded for
immediate delivery.
• Feature:
 settlement normally happens in T+2 working days i.e. delivery of cash, commodity must be
done after 2 working days of trade date.
 It can be through exchange or over-the-counter (OTC).
 Interbank lending market:
• What:
 market in which banks lend funds (loans) to one another for specified term.
 Most interbank loans are for maturities of 1 week or less.
• Feature:
 Interbank loans are made at interbank rate (overnight rate if term of loan is overnight).
• Why:
 Banks are required to hold adequate amount of liquid assets (cash etc.) to manage any
potential bank runs by customers. If bank cannot meet liquidity requirements, it will borrow
money in interbank market to cover shortfall. Some banks, have excess liquid assets and they
will lend money in interbank market, receiving interest on their loans.
 Banks borrow and lend money in interbank lending market in order to manage liquidity and
satisfy regulations (reserve requirements etc).
 Financial service market:
• market that comprises participants like commercial banks that provide financial services like ATM, Credit
cards, Credit rating, stock broking etc.
• Individuals and firms use it to purchase services that enhance workings of debt and equity markets.
 Depository market:
• Market where deposits in depository institutions (banks etc), that accept deposits from individuals and
firms, are used to fund participation in debt market, by giving loans or purchasing debt instruments like T-
Bills.
 Non-depository market:
• Market where functions like financial intermediary, selling, insurance etc. are performed.
• Example - mutual funds, insurance companies, pension funds, brokerage firms, etc.
→ Type (based on market level):
 Primary market / new issue market:
• market for new issues or new financial claims.
• It deals with securities issued to public for 1st time.
• Market where newly started company issued shares to public for 1 st time through IPO.
 Secondary market:
• Market for secondary sale of securities.
• Securities already passed through primary market are traded in secondary market.
• Generally, here, securities are quoted in stock exchanges.
• It provides continuous and regular market for buying and selling of securities.
• Market where 2nd hand securities are sold (security Commodity Markets).
Note:
 Contract:
→ legally enforceable agreement that creates, defines, governs mutual rights and obligations among its
parties.
→ involves transfer / promise to transfer of goods, services, money at future date.
→ In event of breach of contract, injured party may seek judicial remedies (damages, cancellation).
→ Contract law (field of law of obligations concerned with contracts), is based on principle that agreements
must be honoured.
 Forward Contract:
→ It is a customized contract between 2 parties to buy or sell an asset at a specified price on a future date.
A forward contract can be used for hedging or speculation, although its non -standardized nature makes it
particularly apt for hedging.
 Futures Contract:

Page 186 of 719

 → A futures contract is a legal agreement to buy or sell a particular commodity asset, or security at a
predetermined price at a specified time in the future. Futures contracts are standardized for quality and
quantity to facilitate trading on a futures exchange.
 Futures Contract vs. Forward Contract:
→ A futures contract is similar to a forwards contract, where a buyer and seller agree to set a price and
quantity of a product for delivery at a later date. Both types of contract can be used for speculation, as
well as hedging.
However, there are also important differences. While a futures contract is a standardized agreement
that can be traded on an exchange, a forward contract is simply a private agreement between a buyer and
a seller. While it is possible to trade forwards on OTC markets, they are less regulated and less accessible
to retail investors. This means that there are also more opportunities to customize a forward agreement
according to the buyer's and seller's needs.
 Non-Deliverable Forward (NDF):
→ It is a cash-settled, and usually short-term, forward contract. The notional amount is never exchanged,
hence the name "non-deliverable." 2 parties agree to take opposite sides of a transaction for a set amount
of money — at a contracted rate, in the case of a currency NDF. This means that counterparties settle the
difference between contracted NDF price and the prevailing spot price. The profit or loss is calculated on
the notional amount of the agreement by taking the difference between the agreed -upon rate and the
spot rate at the time of settlement.
A non-deliverable forward (NDF) is a 2-party currency derivatives forward contract to exchange cash
flows / currencies. The difference between the pre -agreed rate and the prevailing spot rates at the time
of maturity of the contract is settled.
The largest NDF markets are in the Chinese yuan, Indian rupee, South Korean won, Taiwan dollar, and
Brazilian real.
→ NDF is useful for dealing with non-fully convertible currencies such as Indian Rupee.
 Exchange trading:
→ It is contrasted with exchange trading, which occurs via exchanges.
→ Stock exchange has benefit of facilitating liquidity, providing transparency, maintaining current market
price.
→ Exchange trading occurs with commodities, financial instruments (stocks etc), derivatives.
 Over-the-counter (OTC) trading / Off-exchange trading / Pink sheet trading:
→ Trading done directly between two parties, without supervision of exchange.
→ In OTC trade, price is not necessarily publicly disclosed.
→ OTC trading also occurs with commodities, financial instruments (stocks etc), derivatives.
 Interbank rate:
→ rate of interest charged on short-term loans between banks.
→ overnight rate if term of loan is overnight
 Foreign exchange instruments / transactions are neither debt- nor equity-based and belong in their own category.
 Retail direct scheme:
→ What:
 by RBI
 retail investors will be allowed to open Retail Direct Gilt (RDG) accounts, directly with RBI.
→ Objectives:
 to improve accessibility of government securities.
→ Mechanism:
 dedicated online portal will provide registered users access:
• to primary issuance of government securities; and
• to Negotiated Dealing System - Order Matching system (NDS-OM):
 RBI’s screen-based electronic order matching system for trading in government securities in secondary
market).
→ Types of investments:
 Government of India T-Bills.
 Government of India dated securities.
 SGBs.
 SDLs.
→ Significance:
 one-stop solution to facilitate investment in government securities (G-secs) by individual investors.
 Gilt Account:
→ account for holding government securities.
→ Gilt Account can be compared with bank account, except that Gilt account is debited or credited with T-
Bills or government securities, instead of money.

Page 187 of 719

 Retail investor:
→ someone who buys and sells:
 equity shares
 commodity contracts
 mutual funds
 Exchange Traded Funds (ETFs)
through traditional or online brokerage firms or other types of investment accounts.
 Front running / tailgating:
→ What:
 Prohibited practice of entering into equity (stock) trade, option, futures contract, derivative, or security-based
swap to capitalize on advance, nonpublic knowledge of large ("block") pending transaction that will influence
price of underlying security. In essence, it means practice of engaging in Personal Securities Transaction in
advance of transaction in same security for client's account. Front running is considered one form of market
manipulation in many markets. Cases typically involve individual brokers or brokerage firms trading stock in and
out of undisclosed, unmonitored accounts of relatives or confederates. Institutional and individual investors may
also commit front running violation when they are privy to inside information. Front running firm either buys for
its own account before filling customer buy orders that drive up price, or sells for its own account before filling
customer sell orders that drive down price. Front running is prohibited since front-runner profits from nonpublic
information, at expense of its own customers, block trade, or public market.
 In simple term, Broker gets order from Client to buy say 1 million shares of one company. Broker places order
for same stock for his own account and then he places client’s order. Due to bulk order, broker makes huge
profit.
 Front-running is dubious market practice in which dealer, trader or employee gets wind of big order for buying
or selling shares that will be placed by fund or big investor and gets ‘in front’ of trade. Large orders usually move
stock’s price. By buying shares just before big order hits market and selling them once price moves up, front-
runner pockets illegal gains from his advance knowledge.
→ Concern:
 Front-running by insiders can adversely impact investors in fund by bidding up prices they get to buy stocks or
hammering down prices at which they get to sell.
→ Regulation:
 Such ill practices like Front running are prohibited under Securities and Exchange Board of India (Prohibition of
Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003. This 2003 SEBI
Regulations clearly define front-running and characterises it as fraudulent and unfair practice. SEBI has invoked
this regulation many times to pass orders against front-runners.
 SEBI actions:
• On primary market front, SEBI is keen on enhancing disclosure and compliance requirement for listing of
new-age technology companies.
• For secondary market participants, SEBI is keen on enhancing awareness around responsible investing as
lot of new customers are going for speculative trading.
→ Way Forward:
 Surveillance mechanisms of stock exchanges are most useful to uncover instances of front-running.
 Surveillance software that tracks real-time trades in market is well-equipped to spot similar trading patterns
between big investors and individuals, which form basis for front-running investigations by SEBI.
 SEBI will also need to consider more stringent punishments for information carriers and front-runners when
investigations find hard evidence of wrongdoing.
 Initial Public Offering (IPO) / Stock Launch:
→ What:
 Public offering in which shares of company are sold to institutional investors and usually also to retail (individual)
investors. IPO is typically underwritten by one or more investment banks, who also arrange for shares to be
listed on one or more stock exchanges. Through this process, informally known as floating, or going public,
privately held company is transformed into public company. IPO can be used to raise new equity capital for
companies, to monetize investments of private shareholders such as company founders or private equity
investors, and to enable easy trading of existing holdings or future capital raising by becoming publicly traded.
→ Feature:
 After IPO, shares are traded freely in open market at what is known as free float. Stock exchanges stipulate
minimum free float both in absolute terms (total value as determined by share price multiplied by number of
shares sold to public) and as proportion of total share capital (i.e., number of shares sold to public divided by
total shares outstanding).
 Although IPO offers many benefits, there are also significant costs involved, chiefly those associated with process
such as banking and legal fees, and ongoing requirement to disclose important and sometimes sensitive
information.

Page 188 of 719

 
Details of proposed offering are disclosed to potential purchasers in form of lengthy document known as
prospectus. Most companies undertake IPO with assistance of investment banking firm acting in capacity of
underwriter. Underwriters provide several services, including help with correctly assessing value of shares (share
price) and establishing public market for shares (initial sale).
 Grey market / Dark market:
→ What:
 Trade of commodity through distribution channels that are not authorized by original manufacturer or trade
mark proprietor.
 Grey market products (grey goods) are products traded outside authorized manufacturer's channel.
→ Grey Market Initial Public Offering (IPO):
 What:
• Grey Market IPO is unofficial market where individuals buy / sell IPO shares or applications before they are
officially launched for trading on stock exchange. As it is unofficial over-counter market, there are no
regulations around it. All transactions are done in cash on personal basis. Any 3rd party firms like SEBI, Stock
Exchange, Brokers are not involved or back this transaction.
• Grey market trading is done among small set of people as there is no official platform or rules defined for
these trading. Two popular terms used in IPO grey market are ‘Grey Market Premium' and ‘Kostak'.
• Generally, when companies want to raise funds to fuel their growth, they sell part of their stock on stock
market. This process is called IPO. IPO grey market is unofficial market where IPO shares or applications are
bought and sold before they become available for trading on stock market. It is also termed as parallel
market / over- counter market.
 Regulation:
• Since it is unofficial, there are no regulations that govern it.
• SEBI, stock exchanges, brokers have no part to play in it.
• These transactions are undertaken in cash on one-on-one basis.
 Advantages:
•
{Benefits of investors to trade in IPO Grey Market} {Benefits of companies to trade in IPO Grey Market}
Traders are interested in grey market stocks because Grey market is great way to know how demand for
it can be way of taking advantage of movements in their shares is and how company’s shares might
company’s share price before it has actually listed. perform once it is listed.
Grey Market is excellent opportunity for investors to IPO grey market could be used to measure how
purchase company’s shares even before they are company’s stock will perform once it is listed.
listed, especially if investors feel that company’s
stock will increase in value.
If investor has missed deadline for IPO application or
wants to buy additional shares, then investors can
approach IPO grey market.
Any activity is usually taken as indicator for direction Any activity is usually taken as indicator for direction
stock price will take once it has listed. Pre-market stock price will take once it has listed. Pre-market
price can be used to measure demand for shares. price can be used to measure demand for shares.
 Concerns:
• It performs outside SEBI’s purview.
• Thus, there are no guarantees.
• All transactions are undertaken on basis of trust and carry counterparty risk.
• Therefore, there’s little legal recourse available to parties if stock fails.
 Is Grey Market part of IPO market?
• Grey market is unofficial market, whereas IPO market is official recognized medium of raising funds in
market under SEBI regulation. IPO market and IPO grey market do not have any official connection.
 What decides IPO grey market price?
• Similar to stock prices, Grey market price for IPO is decided by demand and supply numbers. If subscription
for particular IPO is less than stated shares, grey market price will be lower and higher if its reverse case.
 Grey Market Premium (GPM):
• One premium amount at which grey market IPO shares are traded before they get listed in stock exchange.
In simple words, stock of company that came up with IPO bought and sold outside stock market.
• GPM reflects how IPO might react on listing day. For instance, if company introduces IPO of Rs.100 and grey
market premium is around Rs. 20 then we can assume IPO to list around 120 rupees on listing day. There is
no reliability but in most cases, GMP works properly and IPO list around given price.
 Kostak rates:
• Kostak rate is amount where individual pays for IPO application before IPO listing. One can buy and sell their
full IPO application on Kostak rates outside market and fix their profit. Kostak rates apply in every condition
Page 189 of 719
 in getting allotment. For instance, if one did 5 applications for one IPO and sold same at Rs. 2500 per
application it means that individual secured IPO profit at Rs. 12500. However, if he gets allotment in 2
applications still his profit will be same. Further, if he/she sells stock which he earned and gets profit around
25000 then he or she needs to give remaining profit to person who bought application.
 Underwriting (UW):
→ Underwriting services are provided by some large financial institutions, such as banks, insurance companies
and investment houses, whereby they guarantee payment in case of damage or financial loss and accept
financial risk for liability arising from such guarantee. Underwriting arrangement may be created in number
of situations including insurance, issues of security in public offerin g, and bank lending, among others.
Person or institution that agrees to sell minimum number of securities of company for commission is called
Underwriter.
 Surety / Surety Bond / Guaranty:
→ What:
 In finance, surety bond involves promise by one party to assume responsibility for debt obligation of
borrower if that borrower defaults. Usually, surety bond is promise by guarantor to pay one party
(obligee) certain amount if 2 nd party (principal) fails to meet some obligation, such as fulfilling terms
of contract. Surety bond protects obligee against losses resulting from principal's failure to meet
obligation. Person or company providing promise is also known as "surety" or as "guarantor".
→ Feature:
 It is generally provided by insurance company to allow harmed party to make claim on bond to recover
losses.
 Surety bond involves Obligee, Principal, Surety (Guarantor).
→ Definition:
 Surety: Insurance company that guarantees work of principal and is liable for claims against principal
up to bond amount.
 Obligee: Requires that principal purchase bond to attain license or perform service (usually
government agency).
 Principal: Purchases bond and agrees to perform work in compliant manner (ultimately financially
responsible).
 Central Securities Depository (ICSD):
→ financialorganisation that specialises in holding securities. Some CSD organisations also carry out
centralised comparison, and transaction processing - clearing and settlement of securities etc.
→ These securities are either certificated or uncertificated in form so that ownership can be easily transferred
electronically without need for physical certificates. This means that brokers and financial companies can
hold their securities at single location for clearing and settlement.
→ One CSD organisation may be for specific type of security - government bonds etc.
→ International CSD settles trades in international securities – eurobonds, although many ICSD also settle trades in
many domestic securities. ICSDs include Clearstream, Euroclear, SIX SIS.
 Participatory Note / P-Note / Pn:
→ What:
 One financial instrument issued by registered Foreign Institutional Investor (FII) to overseas investor
who wants to invest in Indian stock markets, without registering themselves with market regulator -
SEBI.
→ Genesis:
 SEBI permitted FII to register and participate in Indian stock market in 1992. P -notes are unique Indian
invention started in 2000 by SEBI to enable foreign corporates and high networth investors enter
Indian market without having to go through process of registering as FII.
→ Type:
 One can invest in Equities, shares or debt securities; hybrid securities; derivative segment.
→ Feature:
 P-Notes are Offshore Derivative Investments (ODIs) with equity, shares or debt securities as
underlying assets.
 P-Notes provide liquidity to Overseas Investors.
 FIIs have to report all such investments to SEBI but they (FIIs)need not disclose identity of actual
investors.
→ Concerns:
 Govt. / regulators are concerned because of anonymous nature of P-Notes as actual investors could
be beyond reach of Indian regulators.
 Govt. / regulators are also concerned about its misuse for example round -trip funds. That is, P-Notes
are used in money laundering - collaboration with wealthy Indians who are promoters of companies
etc. to bring back unaccounted funds and to manipulate their stock prices.

Page 190 of 719

 → SEBI:
 SEBI though said no real cause for alarm because currently, P-Notes account for only about 2% of FPI
assets.
→ Significance:
 Investing through P-notes is very simple, and hence very popular amongst FII.
 Financial Asset:
→ What:
 Non-physical asset whose value is derived from contractual claim (bank deposits, bonds, participations in
companies' share capital).
 usually more liquid than other tangible assets (commodities, real estate).
→ Type:
 Security (Finance):
• What:
 Tradable financial asset. Securities are fungible and tradable financial instruments used to raise capital
in public and private markets.
• Representation:
 Certificate:
o Bearer certificates (entitle holder to rights under security merely by holding security)
o Registered certificates (entitle holder to rights only if he or she appears on security register
maintained by issuer or intermediary).
 electronic (dematerialized) (non-certificated)
 book entry only form (non-certificated).
• Example:
 shares of corporate stock; shares of or mutual funds; bonds (issued by corporations, governmental
agencies); stock options; limited partnership units; other formal investment instruments that are
negotiable and fungible.
 Inflation-Indexed Security / Inflation-linked Security / Real Return Security:
o Inflation-indexed security is one security that guarantees return higher than rate of inflation if it is
held to maturity. Inflation-indexed securities link their capital appreciation, or coupon payments,
to inflation rates. Investors seeking safe returns with little to no risk will often hold inflation-
indexed securities. Examples are Treasury Inflation-Protected Securities (TIPS), issued by USA
Government, Inflation Indexed Bonds (IIB) issued by RBI.
• Type:
 Debt security: It is essentially loans repaid with periodic payments. Example: Debentures, Bonds,
Deposits, notes, commercial paper, certificate of deposit.
 Equity security: It provides ownership rights to holders. Example – stocks, mutual funds.
 Hybrid: it combines aspects of debt and equity.
• Another classification:
 Marketable security: liquidity like cash. That can be easily bought and sold in market.
 Non-marketable security: Not-liquid. Non-transferable. Risky. Difficult to buy and sell.
→ Note:
 Non-financial asset:
• opposite of financial assets
• It includes both:
 tangible property (real assets) like land, real estate, commodities
 intangible assets - intellectual property (copyrights, patents, trademarks, data, etc).
 Hybrid security:
• What:
 Hybrid securities are broad group of securities that combine characteristics of two broader groups of
securities - debt and equity.
 Hybrid security is one single financial security that combines 2 or more different financial instruments.
Hybrid securities are securities that have combination of debt and equity characteristics. Original hybrid
security was preferred stock, representing ownership in company (like equity) but having fixed
payments (like bonds).
 Example, Convertible Bonds.
• Feature:
 Hybrid securities pay predictable (either fixed or floating) rate of return or dividend until certain date,
at which point holder has number of options, including converting securities into underlying share.
Therefore, unlike with share of stock (equity), holder enjoys predetermined (rather than residual) cash
flow, and, unlike with fixed interest security (debt), holder enjoys option to convert security to
underlying equity.

Page 191 of 719

  Hybrid security is structured differently than fixed-interest securities. While price of some hybrid
securities behaves more like that of fixed-interest securities, other hybrid securities behave more like
underlying shares into which they may convert.
 Yield (finance):
→ What:
 In finance, yield on security is one measure of ex-ante return (profit on investment) to holder of that security. It
is one component of return on investment, other component being change in market price of that security. It is
one measure applied to fixed income securities, common stocks, preferred stocks, convertible stocks,
convertible bonds, annuities, real estate investments.
 "Yield" refers to earnings generated and realized on investment over particular period of time. It is expressed as
% based on invested amount, current market value, or face value of that security. Yield includes interest earned
or dividends received from holding particular security. Depending on valuation (fixed vs. fluctuating) of that
security, yields may be classified as known yield or anticipated yield. Yield is one measure of cash flow that
investor gets on amount invested in that security. Formula: Yield = Net Realized Return / Principal Amount.
[Thus, result will be in point or %].
→ What Yield indicates?
 Since higher yield value indicates that investor is able to recover higher amounts of cash flows in their
investments, higher value of yield is often perceived as indicator of lower risk and higher income. However, care
should be taken to understand calculations involved i.e. high yield may have resulted from falling market value
of that security, which decreases denominator value used in aforesaid formula and increases calculated yield
value even when that security’s valuations are on decline.
 Yield represents cash flow that is returned to investor, typically expressed on annual basis.
→ Type:
 Yield on Stocks; Yield on Bonds; Yield to Maturity; Yield to Worst; Yield to Call.
→ Yield curve:
 What:
• In finance, yield curve is one graph which depicts how yields on debt instruments - such as bonds - vary as
function of their years remaining to maturity. Typically, this graph's horizontal or X-axis is time line of
months or years remaining to maturity, with shortest maturity on left and progressively longer time periods
on right. Vertical or Y-axis depicts annualized yield to maturity.
• Yield curve is one line that plots yields (interest rates) of bonds having equal credit quality but differing
maturity dates. Slope of yield curve gives idea of future interest rate changes and economic activity. Under
normal circumstances, any economy would have upward sloping yield curve (meaning normal profit from
investment in bond etc.).
 Feature:
• Ronald Melicher and Merle Welshans have identified several characteristics of properly constructed yield
curve. It should be based on set of securities which have differing lengths of time to maturity, and all yields
should be calculated as of same point in time. All securities measured in yield curve should have similar
credit ratings, to screen out effect of yield differentials caused by credit risk. For this reason, many traders
closely watch yield curve for U.S. Treasury debt securities, which are considered to be risk-free. Informally
called "Treasury yield curve", it is commonly plotted on graph. More formal mathematical descriptions of
this relationship are often called term structure of interest rates.
 Type:
• There are 3 main shapes of yield curve shapes:
 Normal Yield Curve (upward sloping curve):
o What:
✓ Normal or up-sloped yield curve indicates yields on longer-term bonds may continue to rise,
responding to periods of economic expansion. Normal yield curve thus starts with low yields
for shorter-maturity bonds and then increases for bonds with longer maturity, sloping
upwards. This is most common type of yield curve as longer-maturity bonds usually have
higher yield to maturity than shorter-term bonds.
o What it indicates?
✓ Normal yield curve implies stable economic conditions and should prevail throughout normal
economic cycle. Steep yield curve implies strong economic growth in future — conditions that
are often accompanied by higher inflation, which can result in higher interest rates.
 Inverted Yield Curve (downward sloping curve);
o What:
✓ In finance, inverted yield curve happens when yield curve graph of typical government bonds
inverts in opposite direction and shorter-term US Treasury bonds are offering higher yield than
long-term Treasury bonds. Longer maturity bonds usually have higher percent yield return
because they are riskier because of volatility in market, there could be Liquidity trap that

Page 192 of 719

 wouldn't allow investor to sell bond security on secondary market over long run and they could
get stuck with underperforming asset.
✓ Inverted yield curve instead slopes downward and means that short-term interest rates
exceed long-term rates. Such yield curve corresponds to periods of economic recession, where
investors expect yields on longer-maturity bonds to become even lower in future. Moreover,
in economic downturn, investors seeking safe investments tend to purchase these longer-
dated bonds over short-dated bonds, bidding up (raise) price of longer bonds driving down
their yield.
o Mechanism:
✓ When investors feel buoyant about economy, they pull money out from long-term bonds and
put it in short-term riskier assets such as stock markets. And thus, in bond market, prices of
long-term bonds fall, and their yield (effective interest rate) rises. This happens because bond
prices and bond yields are inversely related.
However, when investors suspect that economy is heading for trouble, they pull out
money from short-term risky assets (such as stock markets) and put them in long-term bonds.
This causes prices of long-term bonds to rise and their yields to fall.
o Significance:
✓ Inverted yield curve is one of most reliable leading indicators for economic recession since at
least 1955. US Federal Reserve uses OMO to adjust Federal funds rate which pushes up short
term bonds to catch longer maturity bonds which are rising to catch up to inflation during
flattening of yield curve. Inversion of yield curve tends to predate recession 7 to 24 month
ahead of time.
✓ Inverted yield curve is rare but is strongly suggestive of severe economic slowdown.
Historically, impact of inverted yield curve has been to warn that recession is coming. Inversion
of yield curve essentially suggests that investors expect future growth to be weak.
✓ Over years, inversion of bond yield curve has become strong predictor of recessions. In current
instance in 2022, US Fed rose short-term interest rates, which further bumps up short-end of
yield curve while dampening economic activity.
 Flat Yield Curve:
o What:
✓ Flat yield curve is defined by similar yields across all maturities. Few intermediate maturities
may have slightly higher yields, which causes slight hump to appear along flat curve. These
humps are usually for mid-term maturities, 6 months to 2 years. As word flat suggests, there
is little difference in yield to maturity among shorter and longer-term bonds.
o What it indicates?
✓ Such flat or humped yield curve implies uncertain economic situation. It may come at end of
high economic growth period that is leading to inflation and fears of slowdown. It might appear
at times when central bank is expected to increase interest rates. In times of high uncertainty,
investors demand similar yields across all maturities.
 Usage:
• According to finance scholar Dr. Frank J. Fabozzi, investors use yield curves to price debt securities traded
in public markets and to set interest rates on many other types of debt, including bank loans and mortgages.
Shifts in shape and slope of yield curve are thought to be related to investor expectations for economy and
interest rates.
• Investors can use yield curve to make predictions on where economy might be headed and use this
information to make their investment decisions. If bond yield curve indicates economic slowdown might be
on horizon, investors might move their money into defensive assets that traditionally do well during
recessionary times, such as consumer staples. If yield curve becomes steep, this might be sign of future
inflation. In this scenario, investors might avoid long-term bonds with yield that will erode against increased
prices.
 Yield Curve Risk:
• Yield curve risk refers to risk investors of fixed-income instruments (such as bonds) experience from adverse
shift in interest rates. Yield curve risk stems from fact that bond prices and interest rates have inverse
relationship to one another. For example, price of bonds will decrease when market interest rates increase.
Conversely, when interest rates (or yields) decrease, bond prices increase.
 Bond (finance):
→ What:
 In finance, bond is one type of security under which issuer (debtor) owes holder (creditor) debt, and is obliged
– depending on terms – to repay principal (i.e., amount borrowed) of bond at maturity date as well as interest
(called coupon) over specified amount of time. Interest is usually payable at fixed intervals: semiannual, annual,
etc. Thus, bond is one form of loan or IOU. Bonds provide borrower with external funds to finance long-term
investments or, in case of government bonds, to finance current expenditure.

Page 193 of 719

 Bonds and stocks are both securities, but major difference between two is that (capital) stockholders
have equity stake in company (i.e. they are owners), whereas bondholders have creditor stake in company (i.e.
they are lenders). As creditors, bondholders have priority over stockholders. This means they will be repaid in
advance of stockholders, but will rank behind secured creditors, in event of bankruptcy. Another difference is
that bonds usually have defined term, or maturity, after which bond is redeemed, whereas stocks typically
remain outstanding indefinitely. Exception is irredeemable bond, which is perpetuity, that is, bond with no
maturity. Certificates of deposit (CDs) or short-term commercial paper are classified as money market
instruments and not bonds: main difference is length of term of this instrument.
 Bond is type of security used in mutual funds and private investing. Its most common forms include municipal
bonds, corporate bonds. It is instrument of indebtedness, under which issuer (debtor) owes holder (creditor)
debt, and is obliged to pay them interest (coupon) as well as to repay principal at maturity. Usually bond is
negotiable, that is, ownership of this instrument can be transferred in secondary market. It is highly liquid on
secondary market.
 According to RBI, bond is debt instrument in which investor loans money to entity (typically corporate or
government) which borrows funds for defined period of time at variable or fixed interest rate. Bonds are used
by companies, municipalities, States, sovereign governments to raise money to finance variety of projects and
activities. Owners of bonds are debt holders, or creditors, of issuer.
→ Bond Valuation:
 What:
• Bond valuation is determination of fair price of bond. As with any security or capital investment, theoretical
fair value of bond is present value of stream of cash flows it is expected to generate. Hence, value of bond
is obtained by discounting bond's expected cash flows to present using appropriate discount rate.
• Bond valuation is one technique for determining theoretical fair value of particular bond. Bond valuation
includes calculating present value of bond's future interest payments, also known as its cash flow, and
bond's value upon maturity, also known as its face value or par value. Because bond's par value and interest
payments are fixed, investor uses bond valuation to determine what rate of return is required for bond
investment to be worthwhile.
 Note:
• Investors trade (buy / sell) bonds, before their maturity, on secondary market called bond market. Bond
price (value) rise or fall depending on various economic conditions in economy such as: bond supply and
demand, bond maturity period, credibility of bond issuer etc.
→ Bond Yield:
 What:
• Bond yield is return investor realizes on investment in that bond. Coupon rate is annual interest rate
established when bond is issued. Current yield depends on bond's price and its coupon, or interest payment
i.e. Current bond yield is bond's coupon rate divided by its market price.
Bond can be purchased for more than its face value, at premium, or less than its face value, at discount.
 Bond Price (Bond value) vs Bond Yield:
• Bond Price and Bond yield are inversely related and as price of bond goes up, its yield goes down. Bond’s
price moves inversely with its yield (interest rate). That is, there is inverse relationship between price and
yield (interest rate):
 High bond price -> lower bond yield;
 Low bond price -> higher bond yield.
• Reasons for inverse:
 Bonds are fixed-rate investments:
o If investors expect that bond (interest) rates may rise in future, they may sell current lower-rate
bond A and buy higher-rate bond B.
o If investors expect that bond (interest) rates may fall in future, they may keep current higher-rate
bond A and buy more current higher-rate bond as – pushing prices up.
That is, when bond prices rise, investors expect lower rates in market. It increases demand for
previously issued fixed-rate bonds because of their higher yields. At some point, bond price can
increase sufficiently that causes negative yield for bond buyer.
 What it tells investors?
• Bond's yield is return to investor from bond's interest, or coupon, payments. Higher yields mean that bond
investors are owed larger interest payments, but may also be sign of greater risk. Riskier borrower is, more
yield investors demand. Higher yields are often common with longer maturity bond.
 Bond Yield vs Equity:
• Bond yield has inverse relationship with equity because rise in bond yield means that risk premium on
equities must go up.
 Negative Bond Yield:
• What:

Page 194 of 719

  debt instruments / bond that offer to pay investor maturity amount lower than purchase price of that
bond. Here, investors pay interest to borrower to keep their money with them.
• Feature:
 At maturity of bond, money received by bond buyer (investor) < money spent by bond buyer (investor)
in purchasing bond.
 Unusual situation in which bond issuers (Govt., RBI etc.) of bond (debt instrument) are paid by bond
buyers for holding bonds.
 That is, bond buyers (investors / depositors) are effectively paying bond issuers (Govt., RBI etc.) net
amount, at maturity, instead of earning returns through interest.
 At maturity, bond buyer loss money even after considering bond (interest or coupon) rate - paid by
bond issuer to bond buyer.
• Significance:
 From currency fluctuations to deflation, there are scenarios in which purchasers of negative-yield bonds
can come out ahead.
 Investors buy such bonds, eventhough they may get negative yield, because of:
o Safe-haven assets: protect investors’ capital in times of turmoil - stress and uncertainty.
o Asset Allocation.
This is to protect capital from significant erosion.
• When is Negative Bond Yield popular or in demand?
 It is massive amount of liquidity injected by global central banks after COVID pandemic began that has
driven up prices of various assets - equities, debt, commodities.
 Many investors could also be temporarily parking money in negative-yielding government bond for
purpose of hedging their risk portfolio in equities.
 In case fresh wave of Covid-19 pandemic leads to further lockdowns of economies, then there could be
further negative pressure on interest rates, pushing yields down further, and leading to profits even for
investors who put in money in negative yielding bonds.
→ Bond Rating:
 Bond rating is grade given to bond and indicates its credit quality and often level of risk to investor in purchasing
that bond. Rating takes into consideration bond issuer's financial strength or its ability to pay bond's principal
and interest in timely fashion. There are 3 bond rating agencies in USA that account for approximately 95% of
all bond ratings and include Fitch Ratings, Standard & Poor’s Global Ratings, Moody’s Investors Service.
→ Regular bond / Coupon bond / Bearer bond / Bond coupon:
 What:
• One debt obligation with coupons attached that represent semiannual interest payments. With coupon
bonds, there are no records of purchaser kept by issuer; purchaser's name is also not printed on any kind of
certificate. Bondholders receive these coupons during period between issuance of bond and maturity of
bond.
Coupon bond is bond that is essentially anonymous, with no name on bond or sale record. This bond
represents semi-annual interest payments. Coupon bonds are increasingly rare since advent of electronic
payments. Although coupon bonds are rare, they offer simple way for investor to collect on earned interest.
→ Zero-Coupon Bond / Zero Coupon Bond / Accrual bond:
 What:
• Debt security instrument that does not pay interest. It trades at discount, giving profit at maturity when it
is redeemed at its full face value (par). Difference between purchase price of it and par value of it is investor's
return. Because it offers entire payment at maturity, it tends to fluctuate in price, much more so than
coupon bond (Regular Bond). It falls under Held-To-Maturity (HTM) category.
 Zero Coupon Zero Principal (ZCZP) instruments:
• What:
 According to Ministry of Finance, ZCZP instrument means one instrument issued by Not -for-
Profit Organisation which shall be registered with SSE segment of recognised Stock Exchange
in accordance with regulations made by SEBI.
 ZCZP instruments are financial instruments that any non-profit organisation can use to raise
funds. With its zero-coupon, zero-principal structure, ZCZP resembles debt security like bond.
When entity takes loan by issuing regular debt security like bond, it has to make interes t
payments and principal when bond matures. But with this new financial instrument (ZCZP),
when entity issues these ZCZP securities and raises money, it is not loan but donation. So,
borrowing entity does not have to pay interest — therefore zero coupon — and it does not
have to pay principal (zero principal) either.
• Feature:
 Like any other debt instrument, ZCZP will come with time duration. ZCZP bonds will carry
tenure equal to duration of given project.
 There is no clarity yet on whether ZCZP security wil l be transferable.
Page 195 of 719
  Any individual or corporate can buy ZCZP security through any of SSEs, once they are open for
business.
 ZCZPs are meant for NGOs and on it, NGOs are not required to pay principal or interest after
completion of project.
• Status:
 In 2022, Ministry of Finance declared ZCZP instruments as securities, in exercise of powers
conferred by Securities Contracts (Regulation) Act, 1956. Thus, GOI cleared ZCZP instruments
for listing as securities on SSEs. Usually, such organisations raise money through donations
from individuals or corporates. Now, with this government declaration, they can issue ZCZP
security through SSE and those willing to donate money to th eir cause can buy these ZCZP
securities
→ Zero-coupon bond vs Coupon bond:
 Difference between zero-coupon bond and regular bond is payment of interest (coupons):
•
{Zero-coupon bond} {Coupon bond}
does not pay interest pays interest to bond-holders
trades at deep discount, giving investor profit at pays interest over life of bond and also repay
maturity when he redeems bond for its full face principal at maturity.
value.
 Government Security / G-Sec:
→ What:
 Government bond / Sovereign bond is one debt obligation issued by national government to support
government spending. It generally includes commitment to pay periodic interest, called coupon payments, and
to repay face value on maturity date. In investing world, G-sec applies to range of investment products offered
by governmental body. Most common types of government securities are those items issued by USA Treasury
in form of Treasury bonds, bills, notes. However, governments of many nations issue these debt instruments to
fund necessary ongoing operations.
Government securities come with promise of full repayment of invested principal at its maturity. Some
G-secs may also pay periodic coupon or interest payments. These G-secs are considered conservative
investments with low risk since they have backing of government that issued them.
 According to RBI, G-Sec is one tradeable instrument issued by Central Government or State Governments. It
acknowledges Government’s debt obligation. Such securities are short term (usually called treasury bills (T-Bill),
with original maturities of less than 1 year) or long term (usually called Government bonds or dated securities
with original maturity of 1 year or more).
In India, Central Government issues both, T-Bills and bonds or dated securities while State Governments
issue only bonds or dated securities, which are called State Development Loans (SDLs). G-Secs carry practically
no risk of default and, hence, are called risk-free gilt-edged instruments.
 It is one tradeable instrument. Govt. takes money from buyers in promise of returning in future with benefits. It
is issued by Union government / State governments.
→ How:
 Investors lend money to government. Government, in turn, offers piece of paper (G-Sec) guaranteeing principal
and some extra money on top. This extra money on top is called yield on G-Sec that investors will make at end
of say 10 years. Most people believe that government is never going to default on its payment, thus return (yield)
on G-Sec is often called risk free return.
→ Feature:
 It comes with promise of full repayment of invested principal at maturity of G security, which means
acknowledgment of government’s debt obligations. Some G-sec may also pay periodic coupon or interest.
 No risk of default because they are issued by govts. and hence called risk-free gilt-edged instruments. G-sec are
considered conservative investments with low-risk because they have backing of government.
 FPIs are allowed to participate in G-Secs market within quantitative limits prescribed.
 G-sec applies to many investment products offered by government.
→ Types:
 Short term:
• Treasury Bill / T-Bill:
 T-Bills have original maturities of < 1 year. T-Bills are issued only by Union govt. According to
RBI, T-bills, which are money market instruments, are short term debt instruments issued by
GOI and are presently issued in 3 tenors, namely, 91 day, 182 day, 364 day. Treasury bills are
zero coupon securities and pay no interest. Instead, they are issued at discount and redeemed
at face value at maturity. Return to investors is difference between maturity value or face
value and issue price.
• Cash Management Bills (CMB):

Page 196 of 719

  In 2010, GOI, in consultation with RBI introduced one new short -term instrument, known as
CMBs, to meet temporary mismatches in cash flow of GO I. CMBs have generic character of T-
bills but are issued for maturities < 91 days.
 Long term:
• Government bond / Dated security:
 What:
o According to RBI, Dated G-Sec is security / Government bond which has original maturity
>= 1 year and carry fixed or floating coupon (interest rate) which is paid on face value, on
half-yearly basis. Generally, tenor of dated securities ranges from 5 years to 40 years. It is
issued by both GOI and State governments. [In case of State governments, it is called State
Development Loan (SDL)].
 Instruments:
o Fixed Rate Bonds; Floating Rate Bonds (FRB); Floating Rate Bond carrying coupon; Capital
Indexed Bonds; Inflation Indexed Bonds (IIB); Bonds with Call / Put Options; Special
Securities; STRIPS (Separate Trading of Registered Interest and Principal of Securities);
Sovereign Gold Bond (SGB); 7.75% Savings (Taxable) Bonds, 2018; SDL in case of State
Governments.
→ Volatily:
 G-Sec price fluctuates in secondary markets. Factors are:
• Demand and supply of securities.
• Change in interest rates in economy.
• Change in other macro-economic factors: liquidity, inflation etc.
• Developments in other markets: Money market, foreign exchange market, credit market, capital market,
international bond markets - US Treasuries etc.
• RBI policy rates / actions: repo rates, CRR, OMOs.
 Inflation Indexed Bonds (IIB):
→ IIBs are bonds wherein both coupon flows and Principal amounts are protected against inflation. Inflation
index used in IIBs may be WPI or CPI. Globally, IIBs were 1 st issued in 1981 in UK. In India, GOI through RBI
issued IIBs (linked to WPI) in 2013. Since then, they were issued on monthly basis till 2013. Based on
success of these IIBs, GOI in consultation with RBI issued IIBs (CPI based) exclusively for retail customers
in December 2013.
IIBs provide insurance to investors from inflation and cost savin gs for Government on account of
reduction in coupon payments by lowering inflation rate, eliminating of uncertainty risk premium, and
containing inflationary expectations. Extant tax provisions will be applicable on interest payment and
capital gains on IIBs. There will be no special tax treatment for these bonds.
Government can reduce coupon rates on its borrowing by way of IIBs. IIBs provide protection to
investors from uncertainty regarding inflation. Interest received as well as capital gains on IIBs a re taxable.
 State Development Loans (SDLs)
→ What:
 State Governments also raise loans from market which are called SDLs. SDLs are dated securities issued
through normal auction similar to auctions conducted for dated securities issued by GOI. Interest is
serviced at half-yearly intervals and principal is repaid on maturity date.
→ Feature:
 Like dated securities issued by GOI, SDLs issued by State Governments also qualify for SLR.
 SDLs are also eligible as collaterals for borrowing through market repo as well as borrowing by eligible
entities from RBI under LAF and special repo conducted under market repo by The Clearing Corporation
of India Limited (CCIL).
→ Note:
 State Governments have also issued special securities under “Ujjwal Discom Assurance Yojna (UDAY)
Scheme for Operational and Financial Turnaround of Power Distribution Companies (DISCOMs)”.
Value Addition:
 Black Market / shadow market / underground market:
→ economic activity that takes place outside government-sanctioned channels.
→ Black market transactions usually occur under table to allow participants avoid government price controls or taxes.
→ Goods and services offered in black market can be:
 illegal, i.e. their purchase and sale are prohibited by law; or
 legal but transacted to avoid taxes.
 Spot Market:
→ Market where financial instruments:
 commodities [gold, beef, crude oil, natural gas, etc.]
 currencies

Page 197 of 719

  securities etc.
are traded for immediate delivery.
→ Note:
 Delivery - exchange of cash for financial instrument.
 Futures contract - delivery of underlying asset at future date.
 Exchanges and over-the-counter (OTC) markets – provide spot trading and / or future tradings.
 Credit events:
→ Bankruptcy
→ failure to pay
→ obligation acceleration
→ restructuring
→ repudiation / moratorium
→ …
 Fine Paper:
→ Fine papers are high-grade securities whose credit rating makes them almost risk -free; or
Fine papers are commercial papers issued by blue-chip companies with low probability of default.
→ Investing in fine paper is considered to be safe investment but it comes with low return due to its low risk.
Mains Link:
 What are Zero Coupon Bonds? Discuss their significance.
 Discuss the concerns associated with grey markets in India.
 Discuss why Negative Yield Bonds are gaining popularity these days.
 What are the concerns regarding P- Notes? How can they be addressed? Discuss.
CURRENCY SWAP
News:
 2020:
→ India (RBI) signs CSA with Sri Lanka (Central Bank of Sri Lanka), through SAARC currency swap facility [2012].
 Background:
• Sri Lanka is facing foreign currency crisis because of its debt service obligations.
 2022:
→ RBI conducts USD 5 billion dollar-rupee swap auction as part of its liquidity management initiative, leading to infusion
of dollars and sucking out of rupee from financial system.
About:
 What:
→ In finance, currency swap is one interest rate derivative (IRD). In particular, it is linear IRD, and one of most liquid
benchmark products spanning multiple currencies simultaneously.
→ It has pricing associations with interest rate swaps (IRSs), foreign exchange (FX) rates, and FX swaps (FXSs).
 Currency Swap Arrangement (CSA):
→ What:
 Arrangement between 2 friendly countries to involve in trading in their own local currencies.
 both countries pay for import and export trade at pre-determined rates of exchange, without bringing in 3rd
country currency like US Dollar.
 no 3rd country currency is involved and thereby no need to worry about exchange variations.
→ Significance:
 Improves confidence in domestic market [like Indian market].
 Enables agreed amount of capital being available to that country [like India].
 Bring down cost of capital for domestic [Indian] entities while accessing foreign capital market.
 Aids in bringing greater stability to foreign exchange and capital markets in that country [India].
→ India:
 RBI’s Framework for Swap Facilities for SAARC:
• RBI can offer swap arrangement, through SAARC currency swap facility that came into operation in 2012,
within overall corpus of USD 2 billion.
• Swap can be made in:
 US dollar
 Euro; or
 Indian rupee.
• Said RBI framework provides certain concessions for swap in Indian rupee.
• Said RBI framework will be available to all SAARC member countries, subject to their signing bilateral swap
agreements.
 Dollar–Rupee Swap auction:
→ What:
 It’s a forex tool whereby the central bank uses its currency to buy another currency or vice versa.
Page 198 of 719
  In a Dollar–Rupee buy/sell swap, the central bank buys dollars (US dollars or USD) from banks in exchange for
Indian Rupees (INR) and immediately gets into an opposite deal with banks promising to sell dollars at a later
date.
→ Significance:
 Forex swaps help in liquidity management.
 It also, in limited way, helps in keeping currency rates in check.
 Dollar–rupee buy/sell swap injects INR into banking system while sucking out dollars, and reverse happens in
sell/buy swap.
→ Impacts:
 Forex swaps are intended for liquidity management. Therefore, their impact on currency is minor.
 Check on Rupee’s volatility
 help curb Rupee’s depreciation to some extent.
 For bond market, it may have big impact. It means RBI still has option to use traditional liquidity management
(repo rate, CRR, etc) and may buy bonds when needed. Consequently, this strategy can change bond yields.
Value Addition:
 Sri Lanka’s main foreign exchange-earning sectors are:
→ Tourism
→ export of garments
→ export of tea.
 Plain Vanilla:
→ most basic or standard version of financial instrument
→ usually - options, bonds, futures, swaps.
→ opposite of exotic instrument, which alters components of traditional financial instrument, resulting in more
complex security.
Mains Link:
 Discuss the significance of Currency Swap Arrangement.
 Discuss the significance of RBI Currency Swap.

BUSINESS CYCLE / ECONOMIC CYCLE

News:
 2020:
→ RBI says India enters technical recession - for 1st time in its history - due to Covid-19 lockdown.
→ Due to Covid-19 unlock and stimulus packages, Indian economy on path of either V-shaped recovery; or K-
shaped recovery.
 2021:
→ As per NSO, India’s economy is out of recession though far away from returning to rates of growth seen before Covid
pandemic. [In 2020, India got into recession due to covid-19 pandemic].
→ Studies show that India’s middle class had shrunk and crores of people were pushed into below poverty
line (BPL) in 2020. This is largely impact of COVID -19 pandemic.
→ GOI announces fresh relief measures / package – lakhs of crores - for Indian economy.
 Need:
• Studies show that India’s middle class had shrunk and crores of people were pushed into BPL in
2020. This is largely impact of COVID-19 pandemic.
 Focus:
• Extending loan guarantees and concessional credit for pandemic-hit sectors and investments, so as to ramp
up healthcare capacities. Increase of existing ECLGS, 2020.
 Are these measures sufficient?
• Experts believe that these measures would not tackle: low demand, low GDP, high inflation, high
unemployment.
 Way Forward:
• Indian economy is not export-driven economy, but consumption-driven economy. Nearly 55% of Indian GDP
is made up of consumption. So, for consumption to go up, we need to put money in hands of people.
Therefore, need of hour is to generate new demand by increasing consumption. Thus, sectors of economy
need hand holding and not expansion of credit.
→ Prospects of K-shaped recovery from COVID are increasing both in India and across world.
 2022:
→ US Federal Reserve announces most aggressive interest rate increase in almost 30 years, raising benchmark
borrowing rate by 0.75 % points / 75 basis points to bring down inflation to its target rate of 2% from current 9%.
However, there is fear that such move may lead to USA going into recession and thus impacting India and world.
→ With US' inflation rate at 9.1%, highest in 40 years, 3 key terms: Yield inversion, soft-landing, reverse
currency war are in news. [Given massive gap between current US inflation rate — over 9%— and Fed’s

Page 199 of 719

 target inflation rate — 2% — most observers expect that Fed would have to resort to such aggressive
monetary tightening that US economy will end up having hard landing.]
About:
 What:
→ Business cycle is periodic fluctuations in general rate of economic activity, as measured by levels of employment,
prices, and production. Full business cycle could last anywhere between 1 year and 1 decade.
→ Business cycle is one cycle of fluctuations in GDP around its long-term natural growth rate. It explains expansion and
contraction in economic activity that economy experiences over time. One business cycle is completed when it goes
through one single boom and one single contraction in sequence. Time period to complete this sequence is called
length of business cycle. Boom is characterized by period of rapid economic growth whereas period of relatively
stagnated economic growth is recession. These are measured in terms of growth of real GDP, which is inflation-
adjusted.
→ Term economic cycle refers to fluctuations of economy between periods of expansion (growth) and contraction
(recession). It is circular movement of economy as it moves from expansion to contraction and back again. Economic
expansion is characterized by growth while economic contraction sees it go through recession, which involves decline
in economic activity that spreads out over at least few months.
→ Business cycles are intervals of expansion followed by recession in economic activity.
→ In diagram below, straight line in middle is steady growth line. Business cycle moves about this steady growth line.
Extreme points are peak and trough.

 History:
→ Juglar cycle:
 1st authority to explore economic cycles as periodically recurring phenomena was French physician and
statistician Clement Juglar, who in 1860 identified cycles based on periodicity of roughly 8 to 11 years.
→ Kondratieff waves:
 Cycles of greater duration than Juglar cycle have also been studied. For example, construction industry was
found to have cycles of 17 to 18 years in USA and 20 to 22 years in England. Measuring longer-term business
cycles involves study of long waves, or so-called Kondratieff cycles, which were named for Russian economist
N.D. Kondratyev.
 Example:
→ 2007–08 financial crises, COVID-19 pandemic.
 Stages:
→ Expansion:
 What:
• 1st stage in business cycle is expansion. In this stage, there is increase in +ve economic indicators such as
employment, income, output, wages, profits, demand, and supply of goods and services. Debtors are
generally paying their debts on time, velocity of money supply is high, and investment is high. This process
continues as long as economic conditions are favorable for expansion.
→ Peak:
 What:
• As expansion goes on, economy then reaches saturation point, or peak, which is 2 nd stage of business cycle.
Maximum limit of growth is attained. Economic indicators do not grow further and are at their highest.
Prices are at their peak. This stage marks reversal point in trend of economic growth. Consumers tend to
restructure their budgets at this point.
→ Recession:
 What:
• According to National Bureau of Economic Research (NBER) (American private nonprofit research
organization), recession is significant decline in economic activity spreads across economy and lasts from
few months to more than 1 year.

Page 200 of 719

 • Recession is stage that follows peak phase. Demand for goods and services starts declining rapidly and
steadily in this phase. Producers do not notice decrease in demand instantly and go on producing, which
creates situation of excess supply in market. Prices tend to fall. All +ve economic indicators such as income,
output, wages, etc., consequently start to fall.
• Recession is one business cycle contraction when there is general decline in economic activity. Recessions
generally occur when there is widespread drop in spending (adverse demand shock). This may be triggered
by various events, such as financial crisis, external trade shock, adverse supply shock, bursting of economic
bubble, or large-scale anthropogenic or natural disaster. Although definition of recession varies between
different countries and scholars, 2 consecutive quarters of decline in country's real GDP is commonly used
as practical definition of recession.
• It is one macroeconomic term that refers to slowdown or massive contraction in economic activities for long
enough period, or it can be said that when recessionary phase sustains for long enough.
 Feature:
• Downward trend in business cycle characterized by decline in production and employment, which in turn
causes incomes and spending of households to decline. Even though not all households and businesses
experience actual declines in income, their expectations about future become less certain during recession
and cause them to delay making large purchases or investments.
• Recession is when GDP growth rate of country is -ve for 2 consecutive quarters or more. But recession can
be estimated even before quarterly GDP reports are out based on key economic indicators like
manufacturing data, decline in incomes, employment levels etc. Although economy can show signs of
weakening months before recession begins, process of determining whether country is in true recession (or
not) often takes time.
• Recession is short, but its impact can be long-lasting.
 Who decides when recession has started?
• Recessions are officially declared by NBER.
 Impact:
• Recession essentially leads to low growth rate thereby starting vicious circle (Demand falls, sales and
production falls, employment falls, income falls – these 4 in circular) wherein country experiences low
production and high unemployment.
• Increase in unemployment, especially among low-skilled workers, due to companies and even government
agencies laying off staff as way of curtailing expenses.
• Drop in output and business closures. [Fall in output tends to last until weaker companies are driven out of
market, then output picks up again among surviving firms].
• With more people out of work, and families increasingly unable to make ends meet, there will be demands
for increased government-funded social schemes. With drop in government revenues during recession, it
becomes difficult to meet increased demands on social sector.
 Response:
• Governments usually respond to recessions by adopting expansionary macroeconomic policies, such as
increasing money supply, r increasing government spending, decreasing taxation.
• Most popular, or most recommended, policy for any country to dig itself out of recession is expansionary
fiscal policy (fiscal stimulus). This can be usually 2-pronged approach – tax cuts, increased government
spending.
 Vicious cycle of recession:
• Demand falls -> Sales and production falls -> Employment falls -> Income falls -> Demand falls.
→ Depression:
 What:
• Growth in economy continues to decline, and falls below steady growth line. There is proportionate rise in
unemployment. Deep and long-lasting period of -ve economic growth, with output falling for at least 1 year
and GDP falling by > 10%. It can be referred to as severe and prolonged recession.
 Feature:
• During depressions, business economy is marked by sudden stock market declines, commercial
bankruptcies, bank failures, and mounting unemployment.
• Severe and prolonged recession i.e., recessions continue for years.
• It is quite rare - last one was during 1930s in US.
→ Trough:
 What:
• In depression stage, economy’s growth rate becomes -ve. There is further decline until prices of factors, as
well as demand and supply of goods and services, contract to reach their lowest point. Economy eventually
reaches trough. It is -ve saturation point for economy. There is extensive depletion of national income and
expenditure.
→ Recovery:

Page 201 of 719

  What:
• After trough, economy moves to stage of recovery. In this phase, there is turnaround in economy, and it
begins to recover from -ve growth rate. Demand starts to pick up due to low prices and, consequently,
supply begins to increase. Population develops +ve attitude towards investment and employment and
production starts increasing.
• Employment begins to rise and, due to accumulated cash balances with bankers, lending also shows +ve
signals. In this phase, depreciated capital is replaced, leading to new investments in production process.
Recovery continues until economy returns to steady growth levels. This completes one full business cycle
of boom and contraction.
 Stages (another definition):
→ Expansion:
 During expansion, economy experiences relatively rapid growth, interest rates tend to be low, production
increases, and inflationary pressures build.
 In expansionary phase, economy experiences growth over 2 or more consecutive quarters. Interest rates are
typically lower, employment rates rise, and consumer confidence strengthens.
→ Peak:
 Peak of cycle is reached when growth hits its maximum rate. Peak growth typically creates some imbalances in
economy that need to be corrected.
 Peak phase occurs when economy reaches its maximum productive output, signaling end of expansion. After
this point, once employment numbers and housing starts begin to decline, contractionary phase begins.
→ Contraction:
 Correction occurs through period of contraction when growth slows, employment falls, and prices stagnate.
→ Trough:
 Trough of cycle is reached when economy hits low point and growth begins to recover.
 Lowest point on business cycle is trough, which is characterized by higher unemployment, lower availability of
credit, and falling prices.
→ Recovery.
 Determination of current stage:
→ Factors such as GDP, interest rates, total employment, consumer spending, inflation, can help to determine current
stage of economic cycle.
→ We can use some key metrics to determine where economy is and where it's headed. For example, economy is often
in expansion phase when unemployment begins to drop and more people are fully employed. Similarly, people tend
to prioritize and curb their spending when economy contracts, because money and credit are harder to come by as
lenders often tighten up their lending requirements.
→ NBER is one leading source for indicating length of economic cycle.
 Managing Economic Cycles:
→ Governments, financial institutions, investors manage course and effects of economic cycles differently.
Governments often use fiscal policy. In order to end recession, government may use expansionary fiscal policy, which
involves rapid deficit spending. During expansion, Government can use contractionary fiscal policy by taxing and
running budget surplus to reduce aggregate spending to stop economy from overheating during expansions.
→ Central banks may use monetary policy. When cycle hits downturn, central bank can lower interest rates or
implement expansionary monetary policy to boost spending and investment. During expansion, Central bank can
employ contractionary monetary policy by raising interest rates and slowing flow of credit into economy to reduce
inflationary pressures and need for market correction.
→ During times of expansion, investors often find opportunities in technology, capital goods, and basic energy sectors.
When economy contracts, investors may purchase companies that thrive during recessions such as utilities,
financials, health care.
→ Businesses that can track relationship between their performance and business cycles over time can plan strategically
to protect themselves from approaching downturns, and position themselves to take maximum advantage of
economic expansions. For example, if business that follows rest of economy, should not expand during recession and
will be better off building up cash reserves.
 Significance:
→ Understanding economic cycle can help investors and businesses understand when to make investments and when
to pull their money out, because it has direct impact on everything - stocks, bonds, profits, corporate earnings, etc.
 Causes (widely debated among different economic schools of thought):
→ Monetarism:
 Monetarists link economic cycle to credit cycle. Here, interest rates, which affect price of debt, influences
consumer spending and economic activity.
 Monetarism is one school of thought that suggests that governments can achieve economic stability when they
target their money supply's growth rate. It ties economic cycle to credit cycle. Changes in interest rates can

Page 202 of 719

 reduce or induce economic activity by making borrowing by households, businesses, and government more or
less expensive.
 Economist Irving Fisher argued that there is no such thing as equilibrium. He argued that these cycles exist
because economy naturally shifts across range of disequilibrium as producers constantly over or underinvest
and over or underproduce as they try to match ever-changing consumer demands.
→ Keynesian Economics:
 Keynesian approach suggests that economic cycle is caused by changes in volatility or investment demand, which
in turn affects spending and employment.
 Keynesian approach argues that changes in aggregate demand, fueled by inherent instability and volatility in
investment demand, are responsible for generating cycles. Less spending means less demand, which induces
businesses to lay off workers and cut back even further. Unemployed workers mean less consumer spending
and whole economy sours, with no clear solution other than government intervention and economic stimulus.
 John Keynes explains occurrence of business cycles as result of fluctuations in aggregate demand, which bring
economy to short-term equilibriums that are different from full-employment equilibrium. Keynesian models do
not necessarily indicate periodic business cycles but imply cyclical responses to shocks via multipliers. Extent of
these fluctuations depends on levels of investment, because it determines level of aggregate output.
→ Austrian Economists:
 Austrian Economists scholars argue that manipulation of credit and interest rates by central bank creates
unsustainable distortions in structure of relationships between industries and businesses which are corrected
during recession. Whenever central bank lowers rates below what market would naturally determine,
investment and business get changed toward industries and production processes that benefit most from low
rates. But at same time, real saving necessary to finance these investments gets suppressed by artificially low
rates. Ultimately, unsustainable investments and declining asset prices that result in economic downturn.
→ Chicago School of Economics:
 In contrast to Keynesian Economics, economists like Finn E. Kydland and Edward C. Prescott, who are associated
with Chicago School of Economics, challenge Keynesian theories. They consider fluctuations in growth of
economy not to be result of monetary shocks, but as result of technology shocks, such as innovation.
 Soft landing (economics):
→ What:
 Soft landing in business cycle is process of economy shifting from growth to slow-growth to potentially flat, as it
approaches but avoids recession. It is usually caused by government attempts to slow down inflation. Criteria
for distinguishing between hard landing and soft landing are numerous and subjective.
In addition to being certain type of business cycle, soft landing may also refer to market segment or
industry sector that is expected to slow down, but to not crash, while wider economy may not experience such
slow down at that time.
 Soft landing, in economics, is one cyclical slowdown in economic growth that avoids recession. Soft landing is
goal of central bank when it seeks to raise interest rates just enough to stop economy from overheating and
experiencing high inflation, without causing severe downturn. Soft landing may also refer to gradual, relatively
painless slowdown in particular industry or economic sector.
 When central bank is successful in slowing down economy without bringing about recession, it is called soft-
landing — that is, no one gets hurt.
 Hard landing (economics):
→ What:
 Hard landing in business cycle or economic cycle, is economy rapidly shifting from growth to slow-growth to flat
as it approaches recession, usually caused by government attempts to slow down inflation. It is distinguished
from soft landing, in which economy's growth rate slows enough to control inflation, but remains high enough
to avoid recession. Criteria for distinguishing between hard landing and soft landing are numerous and
subjective.
 Hard landing refers to marked economic slowdown or downturn following period of rapid growth. This term
"hard landing" comes from aviation, where it refers to kind of high-speed landing that — while not actual crash
— is source of stress as well as potential damage and injury. This metaphor is used for high-flying economies
that run into sudden, sharp check on their growth, such as monetary policy intervention meant to curb inflation.
Economies that experience hard landing often slip into stagnant period or even recession.
 When central bank is successful in slowing down economy but actions of central bank bring brings about
recession, it is called hard-landing.
Note:
 Economic Recovery / Recession Recovery:
→ Shapes:
 J-shaped recovery:
• somewhat unrealistic scenario
• growth rises sharply from lows much higher than trend-line and stays there.

Page 203 of 719

 K-shaped recovery:
• happens when different sections of economy recover at different rates.
• Things get better for haves and worst for have-nots
• Ex. USA, 2020 covid-19 pandemic recovery.

 L-shaped recovery:
• growth after falling, stagnates at low levels and does not recover for long, long time.
• worst-case scenario
• Ex. Japanese recession 1990s, stagnates for about a decade

 Nike Swoosh shaped recovery:

• like Nike logo
• in between V-shape and U-shape.
• Falls, recovers quickly, slowed down by obstacles, moves gradually back to trend-line.

 Square root shaped recovery:

• rebound from bottom, growth slows and settles at level below from before the crash.

 U-shaped recovery:
• economy, after falling, struggles and low growth rate for some time, before rising gradually to usual levels.
• i.e. long recession, stagnates
• Ex. US downturn early 1970s, stagnates for few years.

Page 204 of 719

 V-shaped recovery:
• Economy quickly regains lost ground and gets back to normal growth trend-line.
• Best case scenario
• Ex. US recession in mid 1950s.

 W-shaped recovery (Double Dip):

• growth falls (downturn) and rises (upturn), but falls again (downturn) before recovering (upturn) yet again.
• dangerous scenario

 WW-shaped recovery:
• Economy slips in and out of recession for long time say for few years.

 Z-shaped recovery:
• economy falls, rises and makes up for lost ground, settles back to normal trend-line.
• most-optimistic scenario but unrealistic scenario

Page 205 of 719

 → Factor:
 GDP print – speed and direction
 fiscal and monetary measures
 consumer incomes
 consumersentiments etc.
 K-shaped recovery in India:
→ Households at top of pyramid:
 During Covid-19 lockdown, their incomes are protected and their savings go up
 Thus, they have high potential to drive future consumption.
→ Households at bottom of pyramid:
 During Covid-19 lockdown, they have lost jobs and incomes.
→ Implication:
 Upper-income households have benefitted from higher savings.
 Households at bottom would drag on demand, if labour market does not heal.
 Income transfer from poor to rich will delay demand because poor consume higher proportion of their incomes
than that of rich.
 If Covid-19 pandemic reduces competition or increases income inequality, then it could hurt productivity and
attract political economy constraints and ultimately hurt growth in developing economies.
 Recessionary phase, Recession, Technical recession, Depression:
→ Recessionary phase is counterpart of expansionary phase i.e when GDP contracts from one quarter to another.
When recessionary phase sustains for long enough, it is called recession. In other words, when GDP contracts
for long enough period, economy is said to be in recession. There is, however, no universally accepted definition of
recession — as in, for how long should GDP contract before economy is said to be in recession. But most economists
agree with definition that NBER in USA uses. According to NBER, recession is significant decline in economic activity
spreads across economy and lasts from few months to more than 1 year.
While basic idea behind term “recession” — significant contraction in economic activity — is clear, from
perspective of empirical data analysis, there are too many unanswered queries. For instance, would quarterly GDP
be enough to determine economic activity? Or should one look at unemployment or personal consumption as well?
It is entirely possible that GDP starts growing after while but unemployment levels do not fall adequately. To get
around these empirical technicalities, economists often consider recession to be in progress when real GDP has
declined for at least 2 consecutive quarters. This is how real quarterly GDP has come to be accepted as measure of
economic activity and “benchmark” for ascertaining “technical recession” (technical definition of recession), i.e.,
sequential decline in real GDP for at-least 2 quarters (quarter is period of 3 months).
Typically, recessions last for few quarters. If they continue for years, they are referred to as “depressions”. But
depression is quite rare; last one was during 1930s in USA.
 Stimulus:
→ What:
 In economics, stimulus refers to attempts to use monetary policy; or fiscal policy; or stabilization policy, in
general, to stimulate economy. Stimulus can also refer to monetary policies - lowering interest rates,
quantitative easing etc. Stimulus is sometimes, informally, referred to "priming pump" or "pump priming".
→ Type:
 Fiscal stimulus: It refers to increasing government consumption; transfers or lowering taxes; or increasing rate
of growth of public debt. Keynesian economics assume stimulus will cause sufficient economic growth via
multiplier effect.
 Monetary stimulus: It refers to lowering interest rates, quantitative easing, or other ways of increasing amount
of money or credit.
→ Why:
 During recession, production and employment are far below their sustainable potential due to lack of demand.
By carrying out stimulus, it is hoped that increasing demand will stimulate growth and that any adverse side
effects from stimulus will be mild.
Page 206 of 719
  Credit Cycle:
→ Credit cycle describes phases of access to credit by borrowers. Credit cycles 1 st go through periods in which
funds are relatively easy to borrow; these periods are characterized by lower interest rates, lowered
lending requirements, and increase in amount of available credit, which stimulates general expansion of
economic activity. These periods are followed by contraction in availability of funds. During contraction
period of credit cycle, interest rates climb and lending rules become stricter, meaning that less credit is
available for business loans, home loans, and other personal loans. Contraction period continues until risks
are reduced for lending institutions, at which point credit cycle troughs out and then begins again with
renewed credit.
Value Addition:
 Direct monetisation / Direct monetisation of deficit:
→ Let’s say, GOI deals with RBI directly — bypassing financial system — and asks it to print new currency in
return for new bonds that GOI gives to RBI. Now, GOI would have cash to spend and alleviate stress in
economy — via DBT to poor, starting construction of hospitals, providing wage subsidy to workers of
MSMEs etc. In return for printing this cash, which is liability for RBI (every currency note has RBI Governor
promising to pay bearer that designated sum of rupees), it gets government bonds, which are asset for RBI
because government bonds carry government’s promise to pay back that designated sum. And since GOI
is not expected to default, RBI is resolved on its balance sheet. With this printed money, Government can
carry on rebooting economy.
 Indirect monetising:
→ RBI conducts OMO; and purchases bonds in secondary market etc.
Question:
 Fiscal stimulus is one intense affirmative action of Government to boost economic activity in country. Fiscal stimulus
refers to increasing government consumption or transfers or lowering taxes, increasing rate of growth of public debt.
Supporters of Keynesian economics assume stimulus will cause sufficient economic growth to fill that gap partially or
completely via multiplier effect.
Mains Link:
 Discuss the trends of recession faced by India in the past. Will the recent action by US Central Bank induce a risk of
recession for other economies such as India? Analyze. (15M)

STOCK EXCHANGE (SE)

News:
 2021:
→ SEBI offers T+1 settlement system for stock Market exchanges. [If stock exchange agrees to this proposal,
investors will get money for shares they sold or bought in their accounts faster, and in safer and risk -free
environment].
 2022:
→ Many social media platforms including YouTube, Twitter, telegram host wh ere advisors not registered with
SEBI are offering advice on stock markets. Now, SEBI is going to tighten its hold on such advisors as this
often misleads investors and harm market.
→ Government supports SEBI’s crackdown on unregistered advisors who make sto ck-related suggestions on
social media platforms.
→ Ministry of Finance declares Zero Coupon Zero Principal (ZCZP) instruments as securities. That is, GOI has
cleared ZCZP instruments for listing as securities on Social Stock Exchanges (SSE).
About:
 Social Stock Exchange (SSE):
→ What:
 Novel concept in India that emerged from SEBI and is defined as platform:
• for fundraising / social capital; and
• for incorporating procedures
by which social impact of social enterprises (Non-profit organizations [NPOs] and For-profit enterprises [FPEs]
will be measured and reported.
 SSEs are meant to be exchanges – like NSE, BSE – except they will list only securities that raise money for non-
profit or for-profit social enterprises. SSE may be put within existing stock exchanges namely, Bombay Stock
Exchange (BSE), National Stock Exchange (NSE).
→ Genesis:
 Proposal to set up SSEs in India was 1st floated during Union Budget in 2019.In 2019, SEBI constituted one
working group under chairmanship of Tata group veteran Ishaat Hussain. In 2020, SEBI set up one technical
group (TG) as it felt further expert advice and clarity was needed on Ishaat Hussain WG’s recommendation.
→ Function:
 To deploy fundraising instruments, structures towards social enterprises (SE)
 To develop overall by creating capacity building units.
Page 207 of 719
  To serve private & non-profit sector providers by channelling greater capital to them.
→ Feature:
 SSE can be housed within existing stock exchange such as BSE, NSE.
→ Significance:
 Social enterprises (SE) listed in SSE can raise social capital / fund on transparent electronic platform.
 It can make SE realise its full potential for creating social impact.
Note:
 Social enterprise (SE):
→ Enterprises that are engage in creation of positive social impact – welfare of society, people.
→ Example - Non-profit organizations [NPOs], For-profit enterprises [FPEs] etc.
→ Primary objective is to achieve social objective like - providing healthcare, education, clean energy etc.
→ Social enterprise is revenue-generating business.
→ Social enterprise can be highly profitable. Only difference between it and traditional business is that its
profits are re-invested into their social programmes.
 Social capital:
→ What:
 OECD defines Social capital as networks among groups of people together with shared norms, values and
understandings that facilitate co-operation among groups of people.
→ Need:
 Post COVID-19, India will need significant amount of patient capital (long term capital)to repair and rebuild
livelihoods, that are bedrock of her economy.
 Conventional capitals that prioritise financial returns will not be able to carry such burden all by themselves.
 Therefore, Social capitalis more suited for this role. Social capital is not only patient capital but also supports
and fortifies social structures that have been affected by COVID-19.
 2020 SEBI Technical Group (TG) on Social Stock Exchanges (SSEs) [Recommendation]:
→ Eligibility:
 Both For-profit (FP) and not-for-profit organisations (NPO) should be allowed to tap SSE, provided they are able
to demonstrate social intent and impact.
 Corporate foundations, political and religious organisations should be made ineligible to raise funds using SSE
mechanism.
→ Modes available for fundraising:
 For NPOs, it shall be equity, Zero Coupon Zero Principal bond (ZCZP), development impact bonds, social impact
fund [social venture fund (SVP)].
 For FP enterprises, it shall be equity, debt, development impact bonds, social venture funds.
→ Corpus size of fund:
 Minimum corpus size for such funds should be fixed.
→ Capacity building fund for SSE:
 It should have corpus of Rs 100 crore.
 This fund should be housed under NABARD.
 Exchanges and other developmental agencies such as SIDBI should be asked to contribute towards this fund.
→ List of broad activities based on those identified by NITI Aayog under SDGs that SEs can engage in include:
 eradicating hunger
 poverty malnutrition
 inequality
 promoting gender equality by empowerment of women and LGBTQIA+ communities
 training to promote rural sports
 slum area development
 affordable housing.
 T+1 (T+2, T+3) settlement system / cycle:
→ T+1 (T+2, T+3) are abbreviations that refer to settlement date of security transactions.
→ “T” stands for transaction date [day transaction takes place].
→ Numbers 1, 2, or 3 denote how many days after transaction date settlement (or transfer of money and
security ownership) takes place.
→ Stocks, mutual funds are usually T+1
→ Bonds and money market funds may be T+1, T+2 or T+3.
Mains Link:
 India will need a significant amount of social capital to repair and rebuild those livelihoods, which are the bedrock of her
economy. Discuss.

STATISTICS
News:
Page 208 of 719
  2021:
→ India celebrates National Statistics Day, in recognition of contributions made by Prof. P.C. Mahalanobis.
 2022:
→ All-India Household Consumer Expenditure Survey (CES) is set to resume in this year 2022 after prolonged
break.
→ NSO releases its Working Paper on Compilation of Labour Indicators of Minimum Set of Gender Indicators to develop
methodology for compiling 3 labour indicators. They are:
 “Proportion of Employed working Part-time, by sex”;
 “Proportion of Employed who are Employer, by sex”;
 “Employment Rate of persons age 25-49 living in household with at least 1 child under age 3 years and with no
children under age 3 years living in household, by sex”.
→ Sugarcane production in India shifting from South to North: According to 2022 National Statistical Office
(NSO) report, 6 sugarcane-producing northern Indian States see a 42% increase in their output value
between 2011 and 2020 while that of 5 States from t he south declined 32.4% during the same period.
About:
 What:
→ Discipline that concerns collection, organization, analysis, interpretation, and presentation of data.
Note:
 Prasanta Chandra Mahalanobis [1893–1972]:
→ Who:
 Professor P.C. Mahalanobis was one Indian scientist and statistician, from erstwhile Bengal (now West Bengal).
He is best remembered for Mahalanobis distance (one statistical measure), and for being one of members of 1st
Planning Commission of free India. He is known as father of modern statistics in India. He was also known as
‘Plan Man’ of India. He is referred to as chief architect of Indian statistical system, and also father of statistical
science in India.
Mahalanobis certainly believed data to be instrumental in efficient planning for national and human
development.
In June, India celebrates Statistics Day, in recognition of contributions made by PC Mahalanobis in fields
of statistics, statistical system, and economic planning.
→ Contribution to statistics:
 He made pioneering studies in anthropometry in India.
 He founded Indian Statistical Institute in 1931 in Kolkata, and in 1959, it was made autonomous body under
MoSPI.
 He contributed to design of large-scale sample surveys and introduced key concepts to theory and practice of
sample surveys.
 He helped in establishment of Central Statistical Organisation (CSO); National Sample Survey (NSS); Annual
Survey of Industries (ASI).
 In 1933, he founded Sankhya (Indian Journal of Statistics).
 In 1936, he introduced statistical measure - Mahalanobis distance.
 In 2nd 5 Year Plan of India, Mahalanobis model was employed for rapid industrialization of India.
 Mahalanobis established Statistical Laboratory within Baker Laboratory at Presidency College.
→ Values:
 Mahalanobis-type innovation, dedication, and diligence are much needed today.
→ Contribution to World:
 WB and UN now use methods pioneered by him.
→ P.C. Mahalanobis’s relations with Rabindranath Tagore:
 17-year-old Mahalanobis 1st met Tagore at Santiniketan (in WB) in 1910.
 Mahalanobis wrote series of essays titled ‘Rabindra Parichay’ (‘Introduction to Rabindra’) for Prabashi (one
prestigious Bengali magazine). He also wrote one book – “Rabindranath Tagore’s Visit to Canada” in 1929.
 He served as joint secretary of Visva Bharati University for 10 years from beginning and also was one member
of governing body, executive council, academic council, and agricultural board.
 Tagore’s dance drama, ‘Basanta’ (meaning ‘Spring’), had one premiere at Calcutta University institute
auditorium on Mahalanobis’ marriage day.
→ Fact:
 Mahalanobis distance:
• It is one measure of distance between point P and distribution D, introduced by P.C. Mahalanobis in 1936.
 Mahalanobis model:
• What:
 It is also known as Feldman–Mahalanobis model
 It is one Neo-Marxian model of economic development, created independently by Soviet economist
Grigory Feldman in 1928 and Indian statistician P.C. Mahalanobis in 1953.

Page 209 of 719

 • Feature:
 Industrial investment towards building up domestic consumption goods sector. In order to reach high
standard in consumption, investment in production of capital goods is firstly needed. High enough
production in capital goods can expand in long-run nation's consumer-goods production capacity.
• 2nd 5-Year Plan: Mahalanobis became essentially key economist of India's 2 nd 5-Year Plan, becoming subject
to much of India's most dramatic economic debates.
 National Statistical Office (NSO):
→ What:
 overarching body formed by government by merging former National Sample Survey Office (NSSO) and
Central Statistical Office (CSO). NSO was 1 st envisaged by Rangarajan Commission to implement and
maintain statistical standards and coordinate statistical activities of Centra l and State agencies as laid
down by National Statistical Commission (NSC) [2005].
 It is statistical wing of Ministry of Statistics and Programme Implementation (MoSPI).
→ Background:
 MOSPI has 2 wings:
• Statistics Wing [It is called National Statistical Office (NSO)]. NSO consists of:
 (i) Central Statistical Office (CSO);
 (ii) Computer center; and
 (iii) National Sample Survey Office (NSSO).
• Programme Implementation Wing. It has 3 Divisions:
 (i) 20 Point Programme
 (ii) Infrastructure Monitoring and Project Monitoring
 (iii) Member of Parliament Local Area Development Scheme (MPLADS).
Besides these 2 wings, there is National Statistical Commission (NSC) created through Resolution
of Government of India (MOSPI) and one autonomous Institute, viz., Indian Statistical Institute
declared as institute of National importance by Parliament.
→ Function:
 It implements and maintains statistical standards and coordinate statistical activities of Central and
State agencies.
 It compiles and releases Index of Industrial Production (IIP) every month in form of ‘quick estimates’.
 It conducts Annual Survey of Industries (ASI).
 Household consumer spending survey:
→ What:
 All-India Household Consumer Expenditure Survey
 Consumer Expenditure Survey (CES) is one quinquennial (recurring every 5 years) survey conducted by
government’s National Statistics Office (NSO) that is designed to collect information on consumer spending
patterns of households across India, both urban and rural.
→ Feature:
 conducted by NSO usually every 5 years.
 It is designed to collect information on consumption spending patterns of households across India, both urban
and rural.
→ Significance:
 Data gathered in this exercise reveals average expenditure on goods (food and non-food) and services.
 It is used to arrive at estimates of poverty levels in different parts of India and to review economic indicators like
GDP.
→ Fact:
 India hasn’t had any official estimates on per capita household spending since 2011–12.
Value Addition:
 World Statistics Day:
→ In October, UN celebrates World Statistics Day.
 Photographic profiloscope:
→ mechanical tool built by PC Mahalanobis, to accurately measure people’s facial features.

SUSTAINABLE DEVELOPMENT (SD)

News:
 2021:
→ In Lafarge Mining Case, 2011, Supreme Court had asked government to set up “independent environment regulator”
to oversee green clearances.
→ NITI Aayog releases 2021 SDG India Index.

Page 210 of 719

 → Madras High Court stayed on office memorandum issued by MoEFCC, that provided procedure for grant of
post facto clearance to projects without environmental clearance under Environmental Impact Assessment
(EIA) notification, 2006.
 2022:
→ MoEF proposes amendments in Environment (Protection) Act, 1986, to remove provision of imprisonment
as penalty for "less severe’’ contraventions. Incidentally, EPA provisions will be in force for penal provisions
of SUP ban which has come into force now.
→ MoEFCC notifies amendment to Environment Impact Assessment (EIA) Rules, exempting highway projects of
strategic and defence importance, which are 100 km from LOC, among other locations, from environmental
clearance before construction.
→ 2022 World Sustainable Development Summit (WSDS) held in virtual format in New Delhi, India.
→ Ministry of Panchayati Raj and UNDP sign joint statement of understanding on localisation of SDGs.
 Need:
• PRIs are critical component of local self-governance across rural India. PRI institutions have achieved last-
mile connectivity in execution of various schemes of different line departments / ministries. SDGs too can
be achieved only if we actively involve PRIs.
• About 65% of India’s population lives in rural areas.
→ UN releases “Sustainable Development Goals Report 2022”.
→ Balance between development and devotion in Himalayas: India's Himalayan region has number of revered Hindu
shrines and they attract millions of pilgrims every year (say Char Dham Yatra). Himalayan region has witnessed
several natural disasters over years, killing thousands. Environmentalists say balanced approach is needed to protect
centuries-old traditions and also Himalayas.
→ Ministry of Panchayati Raj (MoPR) and Institute of Rural Management Anand (IRMA), Gujarat will sign MoU with aim
to give impetus to strengthening and capacity building of PRIs across India, and to establish framework under which
MoPR and IRMA will collaborate in area of Gram Panchayat Development Planning (GPDP) for localization of SDGs
through PRIs i.e. customize SDG goals for villages in India.
Constitution:
 Article 253 (Legislation for giving effect to international agreements):
→ Parliament has power to make any law for whole or any part of territory of India for implementing any treaty,
agreement or convention with any other country or countries or any decision made at any international
conference, association or other body.
About:
 What:
→ organizing principle for meeting human development goals while also sustaining ability of natural systems to provide
natural resources and ecosystem services on which economy and society depend. Desired result is state of society
where living conditions and resources are used to continue to meet human needs without undermining integrity and
stability of natural system.
→ It is development that meets needs of present generation without compromising ability of future generations to
meet their own needs. [This is most widely accepted definition of Sustainable Development and was given by
Brundtland Commission in 1987].
 History:
→ 1987: UN’s Brundtland report provides most popular definition of SD – “development that meets needs of present
without compromising ability of future generations to meet their own needs.”
→ 1997: Global Reporting Initiative (GRI) is formed.
→ 2002: World Summit on SD extends definition of SD to embrace not only enrvironmental aspects but also social
inclusion and economic development.
→ 2011: Sustainability Accounting Standards Board (SASB) is created to develop and spread sustainability accounting
standards.
→ 2015: UNGA adopts 2030 Agenda for SD, accompanied by list of SDGs i.e. 17 objectives and 169 targets.
 Feature:
→ “Sustainable Development“ is interlinked with normative concept of “sustainability”. UNESCO formulated their
distinction as - "sustainability” is often thought of as long-term goal i.e. more sustainable world, while “sustainable
development” refers to many processes and pathways to achieve “sustainability”.
→ It calls for efforts towards building inclusive, sustainable and resilient future for people and planet.
→ 3 core elements of sustainable development: environmental protection, social inclusion, Economic growth. It is
crucial to harmonize said 3 core elements.
 Sustainable Development Goals (SDGs) / Global Goals [2015]:
→ What:
 collection of 17 interlinked global goals designed to be blueprint to achieve better and more sustainable future
for all. SDGs were set up in 2015 by UNGA. SDGs are intended to be achieved by 2030. SDGs are included in
UNGA resolution called 2030 Agenda/ Agenda 2030. SDGs were developed in Post-2015 Development Agenda

Page 211 of 719

 as future global development framework to succeed Millennium Development Goals (MDGs) which ended in
2015.
→ 17 SDGs:
 No Poverty; Zero Hunger;Good Health and Well-being; Quality Education; Gender Equality; Clean Water and
Sanitation; Affordable and Clean Energy; Decent Work and Economic Growth; Industry, Innovation and
Infrastructure; Reduced Inequality; Sustainable Cities and Communities; Responsible Consumption and
Production; Climate Action; Life below water; Life on land; Peace, Justice and Strong Institutions; Partnership for
goals.
 World Sustainable Development Summit (WSDS):
→ annual event of - The Energy and Resources Institute (TERI) [based in New Delhi].
→ It brings together Nobel laureates, political leaders, decision-makers from bilateral and multilateral institutions,
business leaders, high-level functionaries from diplomatic corps, scientists and researchers, media personnel,
members of civil society; on common platform to deliberate on issues related to sustainable development.
→ sole summit on global issues taking place in developing world.
→ It provides platform for global leaders and practitioners to discuss and deliberate over climatic issues of universal
importance.
→ It strives to provide long-term solutions for benefit of global community by assembling world’s most enlightened
leaders and thinkers on single platform.
→ It is continuing legacy of Delhi Sustainable Development Summit (DSDS) [2001].
→ WSDS 2022:
 theme - ‘Towards Resilient Planet: Ensuring Sustainable and Equitable Future'.
 held in New Delhi, India.
 Localization of SDGs / SDG Localization:
→ Why:
 Localizing SDGs can provide framework for local development policy, esp. as 14 th FC devolved more funds for
local bodies and over 65% of India’s population still lives in rural areas.
→ Initiative:
 For India, in 2022, Ministry of Panchayati Raj (MoPR) and Institute of Rural Management Anand (IRMA), Gujarat
will sign MoU with aim to give impetus to strengthening and capacity building of PRIs across India, and to
establish framework under which MoPR and IRMA will collaborate in area of Gram Panchayat Development
Planning (GPDP) for localization of SDGs through PRIs i.e. customize SDG goals for villages in India. IRMA will
provide inputs to MoPR for policy interventions in localization of SDGs and other PRI related matters.
 UN Economic and Social Commission for Asia and Pacific (ESCAP) is most inclusive intergovernmental platform
in Asia-Pacific region that promotes localization of SDGs.
 India:
→ Delhi Sustainable Development Summit (DSDS) [2001]:
 flagship annual event organised by The Energy and Resources Institute (TERI), since 2001
 international platform to facilitate exchange of knowledge on all aspects of sustainable development.
 one of foremost fora on issues of global sustainability.
 brings together various Heads of State and Government, thought leaders, policy makers, best industry and
academia to deliberate on many issues, from many countries.
 This summit has evolved as significant congregation of leaders from fields of polity, economy, academia, civil
society to deliberate on issues related to sustainable development.
→ SDG India Index [2018]:
 What:
• Index for Sustainable Development Goals (SDGs) in India.
• primary tool for monitoring progress on SDGs in India.
• developed in collaboration with UN India.
 Function:
• tracks progress of all States and UTs on 115 indicators aligned with National Indicator Framework (NIF) of
Ministry of Statistics and Programme Implementation (MoSPI).
• Ranking:
 score ranges between 0 – 100.
 Categories: Aspirant: 0 – 49; Performer: 50 – 64; Front-runner: 65 – 99; Achiever: 100.
 Currently, no States in Aspirant and Achiever categories.
 Significance:
• encourages competition among States and UTs, by ranking them on global goals.
 2021 SDG India Index:
• India’s overall SDG scores improves. Reason - improvement in providing facilities - clean water, sanitation,
affordable and clean energy etc.
 Top positions: Kerala, Himachal Pradesh, Tamil Nadu.
Page 212 of 719
  Worst positions: Bihar, Jharkhand, Assam
 Chandigarh - top among UTs.
 Environmental Law:
→ What:
 It is one collective term encompassing aspects of law that provide protection to environment. It is
related to forests, minerals, air, water, fisheries, etc.
→ Main environmental laws in India are:
 Water (Prevention and Control of Pollution) Act, 1974; Air (Prevention and Control of Pollution) Act,
1981; Environment (Protection) Act, 1986; Rules made under above Acts.
→ 3 main entities responsible for environmental laws in India:
 MoEFCC; CPCB at National level; SPCBs at State level.
→ Environment (Protection) Act, 1986:
 What:
• Act to provide for protection and improvement of environment and for matters connected there with:
WHEREAS decisions were taken at UN Conference on Human Environment held at Stockholm in 1972, in
which India participated, to take appropriate steps for protection and improvement of human environment;
and WHEREAS it is considered necessary further to implement decisions aforesaid in so far as they relate to
protection and improvement of environment and prevention of hazards to human beings, other living
creatures, plants and property.
• It was enacted under Article 253. And, EPA establishes framework for studying, planning, and implementing
long-term requirements of environmental safety and laying down system of speedy and adequate response
to situations threatening environment.
 Way Forward:
→ To achieve SDG targets, one focus area should be to address issue of health, health emergencies and
catastrophic health expenditures. Although only Goal 3 of SDGs directly focuses on good health and well -
being, other goals are also linked to health. For example, Goals 1 and 2 — No poverty and Zero hunger —
cannot be attained if issues related to health are not addressed.
Note:
 Corporate sustainability:
→ approach aiming to create long-term stakeholder value through implementation of business strategy that
focuses on ethical, social, environmental, cultural, economic dimensions of doing business.
→ strategies created are intended to foster longevity, transparency, and proper employee development
within business organizations.
→ Firms will often express their commitment to corporate sustainability through statement of Corporate
Sustainability Standards (CSS), which are usually policies and measures that aim to meet, or exceed,
minimum regulatory requirements.
 Sustainable Development Goals Report:
→ Report / index released by UN.
→ This UN SDG index provides global overview of progress on implementation of 2030 Agenda for Sustainable
Development, using latest available data and estimates. It tracks global and regional progress towards 17 Goals with
in-depth analyses of selected indicators for each Goal.
→ It is one global assessment of countries’ progress toward achieving SDGs. It is published by group of independent
experts at Sustainable Development Solutions Network (SDSN).
→ Sustainable Development Goals Report 2022:
 What:
• 2022 edition marks 7th edition of annual assessment of progress of all UN Member States towards SDGs.
2022 year's report discusses critical need and channels of development finance for low-income and lower-
middle income countries.
 Highlights:
• All 17 SDGs, are in jeopardy due to climate crisis, COVID-19 pandemic, increase in number of conflicts across
world.
• 2022 SDG Index is topped by 3 Nordic countries – Finland, Denmark, Sweden – and all top 10 countries are
European countries.
• No improvement in performance: Performance on SDG-1 (No Poverty) and SDG-8 (Decent Work and
Economic Growth) remain below pre-Covid pandemic levels in many Low-Income Countries (LICs) and
Lower-Middle-Income Countries (LMICs).
• Slow progress on climate and biodiversity: Progress on climate and biodiversity goals is also too slow,
especially in rich countries.
• Rise in GHG: GHG emissions are set to rise 14% over next decade.
• Contrast to Paris Agreement plan: 2025 peak followed by 43% decline by 2030 and Net 2050.

Page 213 of 719

 •Covid Pandemic as threat: Covid pandemic itself has emerged as one of biggest threats to several SDGs,
pointing at 15 million “excess deaths” directly or indirectly due to novel coronavirus by 2021.
• Health emergency: Economic shocks due to worldwide health emergency pushed 93 million into poverty in
2020 alone, undoing “more than 4 years” work at alleviating poverty. It also affected education and
healthcare services for millions. Immunization, for example, has dropped for 1 st time in this decade even as
deaths from malaria and TB have risen.
• Lowering of global economic growth: Covid pandemic and 2022 Russia-Ukraine war have already led to
lowering of global economic growth projections by 0.9% points - Raising food and fuel prices; Hampering
global supplies and trade; Disturbing financial markets.
 On India:
• India is ranked at 121.
• India’s preparedness for SDG has worsened over years in comparison with other countries. Major Challenges
include: Ensuring decent work (SDG-8). India’s performance on climate action (SDG-13) has slipped.
• Progress have been made on goals such as SDG-2 (No hunger), SDG-3 (on health) and SDG-6 (clean water
and sanitation).
 Suggestions:
• Developing countries need to strengthen their debt management and creditworthiness.
• G20 should univocally finance developing countries.
• G20 should greatly increase lending capacity and annual flows of Multilateral Development Banks (MDB).
• G20 should support increased Official Development Assistance (ODA), large-scale philanthropy, and
refinancing of debts.
• IMF and credit-rating agencies need to redesign assessments of debt sustainability.
 Impact Assessment (IA):
→ Types:
 Environmental Impact Assessment (EIA):
• What:
 Assessment of environmental consequences of plan, policy, program, actual projects prior to decision
to move forward with proposed action. Term EIA is usually used when assessment is applied to projects
by individuals or companies. Term Strategic Environmental Assessment (SEA) applies to policies, plans,
programmes proposed by govt., organs of state. EIA is important tool to ensure optimal use of natural
resources for sustainable development.
 EIA is one process of evaluating likely environmental impacts of proposed project or development. EIA
also takes into account human health and socioeconomic impact on community living in proposed
project area.
 UNEP defines EIA as one tool used to identify environmental, social and economic impacts of project
prior to decision-making.
• History: EIA was introduced by National Environment Policy Act (NEPA) in USA in 1970.
• Aim: To identify, examine, assess, evaluate likely impact of proposed project on environment.
• India:
 Under Environment (Protection) Act, 1986, India notifies EIA norms, setting in place legal framework
for regulating activities that access, utilise, affect (pollute) natural resources. EIA norms mandates every
development project to go through EIA process for obtaining prior environmental clearance. Currently,
India notifies Environmental Impact Assessment (EIA) notification, 2006.
 Evolution:
o During 1976-77, Planning Commission asked for river valley projects to be examined from
Environmental angle.
o 1994: EIA notification promulgated under Environment (Protection) Act, 1986. This notification
made Environmental Clearance (EC) mandatory for expansion or modernization of some projects.
o 2006: EIA notification 2006 legislation put onus of clearing projects on State government
depending on size / capacity of that project.
 Significance:
o EIA for developmental projects in India make all stakeholders aware of environmental and socio-
economic impact of that project.
o Facilitates basis for policy decisions: EIA provides impact assessment well before project is
implemented.
o It helps to eliminate or minimize adverse impact of developmental projects.
o EIA encourages the adaptation of mitigation strategies in the developmental plan
o It protects biodiversity of environment by suggesting alternative safe project designs and methods.
o Simplification of technical issues: EIA produces environmental management plan and summary for
non-tech general public.
• Way Forward:

Page 214 of 719

  EIA needs to provide balance between ease of doing businesses and maintaining environmental
sustainability. In this context, one Independent EIA Authority can be set up for fair and objective
decisions. Also, one centralized data bank for storing information and providing access to local
communities and general public to all aspects of projects.
 Social Impact Assessment (SIA):
• methodology to review social effects of infrastructure projects, development projects.
• Components: Hazard assessment; Risk assessment; Cultural impact; EIA; Project Program & Policy
Evaluation; Economic assessment.
 Health Impact Assessment (HIA):
• combination of procedures, methods, tools by which policy, program, project may be judged as to its
potential effects on health of population, and distribution of those effects within population.
 Independent Environment Regulator (proposed):
→ What:
 This proposed regulator is to be setup under Environment (Protection) Act, 1986, as independent environment
regulatory body at national level.
→ Aim:
 To ensure independent oversight of green clearances.
→ Function:
 independent, objective and transparent appraisal / approval / disapproval in relation to environmental
clearances for development projects.
 Monitor implementation of its orders passed.
 Impose penalties on polluters.
→ Power:
 To ensure proper implementation of National Forest Policy, 1988.
→ Need:
 Supreme Court has been dealing with forest-related issues for almost 2 decades. SC has experienced major
problems with the way environment and forest clearances are granted. SC has had to deal with poor EIA reports
and bad decisions of Forest Advisory Committee (FAC) while recommending diversion of forest-land for
developmental projects. SC has found conflict of interest in the way EIA report is prepared. Thus, SC is of view
that independent national regulator is reqd. as solution to this problem.
 Environment Impact Assessment Rules / EIA Rules [amended in 2022] [India]:
→ Exempted highway projects of strategic and defence importance: Any project which is 100 km from LOC,
among other locations, will be exempted from environmental clearance before construction. Impact: It will
do away with need for green clearance for construction of controversial Ch ar Dham project, (connectivity
to Kedarnath, Badrinath, Yamunotri, Gangotri shrines).
→ Exemption to thermal power plant: Thermal power plants up to 15 MW based on biomass or non -hazardous
municipal solid waste using auxiliary fuel such as coal, lignite, pet roleum products up to 15% are exempted.
→ Ports which exclusively deal in fish handling, and cater to small fishermen, are exempted from
environmental clearance.
→ Other projects exempted are Toll plazas that need more width for installation of toll collection booths, and
expansion activities in existing airports without increase in airport’s existing area.
 Indian Himalayan Region (IHR):
→ Religious value of Himalayas: It is home to temple towns of Kedarnath, Badrinath, Yamunotri, Gangotri
which are part of Himalayan Char Dham Yatra (4 Pilgrimages), Amarnath cave shrine, Vaishno Devi temple.
→ As per report “Environmental Assessment of Tourism in Indian Himalayan Region (IHR)’ ” by GB Pant
National Institute of Himalayan Environment, demand for tourism has increased pressure on Indian
Himalayan Region (IHR).
→ Dangers:
 Surge in number of worshippers over past couple of decades – partly due to greater mobility and connectivity –
and infrastructural development to accommodate them are damaging fragile ecological balance of IHR, which is
vulnerable to earthquakes and landslides.
 Climate change: Rising temperatures were increasing frequency of rock falls in Himalayas, which could increase
danger to people.
 Revenue dependence: Tourism brings much-needed revenue to State governments – this can reduce incentive
to take tough calls to conserve nature.
 Environmental impact: Pollution, biodiversity loss, waste generation.
 Loss of indigenous culture.
→ Solution:
 Removing “institutional vacuum”: Develop better policies for environmentally fragile pilgrimage. This should
include consultation with religious actors who actively participate in promotion and management of religious
tourism economy at local levels.

Page 215 of 719

  National Strategy for Sustainable Tourism: Ministry of Tourism launched this for development of sustainable
tourism like promoting environmental sustainability, protecting biodiversity, promoting economic sustainability,
etc.
 Development to cater to local needs: Current infrastructure development doesn’t cater as much to locals as they
do to people from other States. Community-based tourism will enable conservation along with development
 Planned management of religious gatherings: India has successfully shown this during Kumbh Mela, which is
held across 4 States.
 Sustainable development demands approach that is both geologically and ecologically sound.
 Efficient and wider data collection: 2022 Flash flood at Amarnath shrine was triggered by cloudburst, which led
to highly intense and highly localised rainfall that our automatic weather station could not catch.
 Regulation of numbers: Most experts agree that regulating pilgrim numbers according to terrain’s capacity is
essential. Eg. Bhutan charges tourism tax and only allows certain number of tourists per year, so as not to harm
fragile environment.
 Levying green tax on tourist vehicles can be another measure.
 Awareness programmes: Authorities need to provide regular, updated information through advertisements and
public service broadcasters that also highlight risks and dangers involved in journey.
Value Addition:
 Millennium Development Goals (MDG) were aimed mostly at poorer countries while SDG goals are designed to be
universal.
 Espoo (EIA) Convention, 1991:
→ Convention on Environmental Impact Assessment in Transboundary
→ sets out obligations of Parties to assess environmental impact of certain activities at early stage of
planning.
Question:
 SDGs were born at UN Conference on Sustainable Development in Rio de Janeiro in 2012. SDGs were adopted by all UN
Member States in 2015 to end poverty, reduce inequality and build more peaceful, prosperous societies by 2030. SDGs
have to be achieved by 2030.
Mains Link:
 Besides being a moral imperative of the Welfare State, primary health structure is a necessary precondition for
sustainable development.” Analyze. (UPSC 2021)
 Explain the significance of the Environment Impact Assessment (EIA) process in the Indian context. Also, highlight the
concerns associated with it. (15M)
 Environmental Impact Assessment studies are increasingly undertaken before a project is cleared by the Government.
Discuss the environmental impacts of coal-fired thermal plants located at coal pitheads. ( UPSC 2014)
 Evaluate the policies and schemes that are being used to promote eco-tourism in India. (15M)

GENETICS
About:
 What:
→ Genetics is one branch of biology concerned with study of genes, genetic variation, and heredity in organisms. It was
1st experimentally established by Gregor Mendel.
Note:
 Gregor Mendel (1822-1884):
→ Who:
 He is known as "father of modern genetics". Gregor Johann Mendel, was one monk, biologist, meteorologist,
mathematician. Mendel was born in German-speaking family in Silesian part of Austrian Empire (today's Czech
Republic) and gained posthumous recognition as founder of modern science of genetics. Though farmers had
known for millennia that crossbreeding of animals and plants could favor certain desirable traits, Mendel's pea
plant experiments established many of rules of heredity, now referred to as laws of Mendelian inheritance.
→ His contributions to Science:
 Principles of Inheritance: By experimenting with pea plant breeding, Mendel developed 3 principles of
inheritance that described transmission of genetic traits, before anyone knew genes existed. To this day,
scientists use Mendel’s principles to explain most basic phenomena of inheritance.
 Foundation of biology: Mendel’s theory, together with evolutionary theory propounded by Charles Darwin, laid
foundations of biology.
 Cure for many human diseases: Assisted clinicians in human disease research. For example, within just couple
of years of rediscovery of Mendel’s work, Archibald Garrod applied Mendel’s principles to his study of
alkaptonuria (discolouration of skin). Science of genomics and gene editing has its root in work of Mendel.
 1st to apply maths to biology: Mendel may have been 1st botanist who seriously applied mathematics to biology,
unlike Charles Darwin, who was judged by observation rather than by calculation.
 He was one who coined terms dominant and recessive to describe these traits, which are used even today.
→ Concept:
Page 216 of 719
  Mendel’s principle of inheritance:
• Law of Segregation: Two alleles for each gene are placed in different gametes. [Allele is one variant of gene]
• Law of independent Assortment: Inheritance of one gene does not affect inheritance of any other gene.
• Law of dominance: When two different alleles are present, only one is dominant and will be expressed.
 Mendel's pea plant experiments:
• Mendel started with 22 pea plants and cross-bred them to get over 10000 plants. These were classified
according to set of characteristics like seed colour, shape of pod, colour of flower, etc.
• He found that some traits (e.g. shape, colour), can be passed down from one generation to next.
Question:
 In context of hereditary diseases, passing on mitochondrial diseases from parent to child can be prevented by
mitochondrial replacement therapy either before or after in vitro fertilization of egg. Child inherits mitochondrial diseases
entirely from mother and not from father. Mitochondrial Replacement Therapy (MRT) is one form of reproductive in-
vitro fertilization (IVF) which works on principle of replacing women’s mitochondrial DNA (mt-DNA) with donor’s (another
woman) healthy one. In offspring, mitochondrial genes are inherited from mother. Thus, father with mitochondrial gene
defect cannot transmit disease to his offspring.

EDIBLE OIL
News:
 2021:
→ Environmental activists concerned over Union’s proposal to promote oil palm cultivation in NE States, AN Island:

{against} {Environmentalist view} {for} {Government’s view}
Since oil palm is invasive species, it will further land identified for cultivation in NE States are already
degrade environment of original ecosystem, already cultivating in oilseeds. Thus, shifting to oil palm is
threatened by various other threats. more productive than cultivating oilseeds for
farmers.
impact on community ownership of tribal lands
water-intensive task
monoculture cropping with long gestation / growing
period [thus unsuitable for small farmers]
endangering wildlife
→ Edible oil prices increase. Reason:
 Global commodity prices are extremely high. COVID-19 is major factor, disrupting supply chains, closing down
industries. Insufficient labour in oil production industry in many countries. Excessive buying of edible oil by
China. Many major oil producers are aggressively pursuing biofuel policies and diverting their edible oil crops for
biofuel purpose. High governmental taxes and duties and thereby increasing retail price of edible oils in India.
→ Edible oil prices decrease. Reason: Stabilisation of global prices; Duty cuts; Cut in wholesale prices by major private
players; Stock limits imposed by Centre, using Essential Commodities Act, 1955.
 2022:
→ Due to stringent measures by Centre, prices of edible oil have been controlled for last 2 years, despite Covid situation.
However, war in Ukraine has driven prices of many commodities up including edible oil prices.
 Issue: Most of sunflower oil supplies to India was coming from Ukraine, while domestic production accounts for
about 1/4 of domestic demand. With Ukraine being war-hit, sunflower oil supplies are completely stopped. As
sunflower oil supplies reduce, consumers are moving to groundnut oil, palm oil, and thus driving up their prices
as well.
→ In bid to cool inflation in edible oils, Centre allows duty free import of 20 lakh tonnes each of crude soybean oil and
crude sunflower oil for 2022-23, 2023-24.
→ EU adopts draft rules for ReFuelEU initiative, which would mean 85% of all used aviation fuel would have to be
sustainable by 2050. [In 2018, EU had decided to phase out import of unsustainable palm oil by 2030. Indonesia,
Malaysia say EU’s palm oil restrictions are unfair, discriminatory, and crop apartheid and challenged EU in WTO.
Indonesia, Malaysia are world’s two largest palm oil producers, accounting for 90% of global production. However,
most of it is produced on plantation by clearing rainforests].
→ Asian Palm Oil Alliance (APOA): Edible oil trade associations from 5 palm oil importing countries in South Asia – India,
Pakistan, Sri Lanka, Bangladesh, Nepal – announces setting up of APOA. Idea is to gain collecting bargaining power
and make imports sustainable.
About:
 Cooking oil:
→ Plant, animal, or synthetic liquid fat used in frying, baking, and other types of cooking. It is also used in food
preparation and flavoring not involving heat, such as salad dressings and bread dips, and may be called edible oil.
Cooking oil is typically liquid at room temperature, although some oils that contain saturated fat, such as coconut
oil, palm oil and palm kernel oil are solid. There are wide variety of cooking oils from plant sources such as olive oil,
palm oil, soybean oil, canola oil (rapeseed oil), corn oil, peanut oil, other vegetable oils, as well as animal-based oils
Page 217 of 719
 like butter, lard. Oil can be flavored with aromatic foodstuffs such as herbs, chillies or garlic. Cooking spray is aerosol
of cooking oil.
 Source:
→ Primary sources: Soybean, Rapeseed, Mustard, Groundnut, Sunflower, Safflower, Niger.
→ Secondary sources: Oil palm, Coconut, Rice Bran, Cotton seeds, Tree borne oilseeds.
 Example:
→ Groundnut oil; mustard oil; vanaspati oil; soya oil (soybean - India’s largest oilseed crop); sunflower oil; Palm oil.
 India:
→ India’s import dependence:
 India - world’s biggest vegetable oil importer. More than ½ of India’s edible oil consumption is imported. That
is, India imports about 60% of its edible oil needs. This makes India’s edible oil retail prices vulnerable to
international pressures.
 India imports: Palm oil - from Indonesia, Malaysia; Soya oil / Soybean oil - from Brazil, Argentina; Sunflower oil -
from Ukraine, Russia. Sunflower oil accounts for 14% of all edible oil imports. In 2019, edible oils accounted for
40% of agriculture import bills and 3% of overall import bill of India.
→ India’s challenges in oilseed production:
 Rain dependent (lack of irrigation). high seed cost. small holding. low seed replacement rate. low productivity.
Note:
 Palm oil:
→ What:
 Palm oil is one edible vegetable oil derived from mesocarp (reddish pulp) of fruit of oil palms. Mainly grows in
tropical countries. World’s most consumed edible vegetable oil. Alternatives to palm oil: Coconut oil, Babassu
oil. It is edible vegetable oil produced from palm fruit of Elaeis Guineensis / Oliefera.
→ Feature:
 It is rich in Vitamins A and E and has no trans fatty acids.
→ Usage:
 Palm oil is used in food manufacturing, in beauty products, and as biofuel (use of crude palm oil in making
biodiesel is being branded as ‘green diesel’). used largely in production of detergents, plastics, cosmetics,
biofuels.
→ Status:
 Indonesia, Malaysia are world’s two largest palm oil producers, accounting for 90% of global production,
however, most of it is produced on plantation by clearing rainforests.
 Top consumers – India (biggest importer), China, EU.
 Asia accounts for around 40% of global palm oil consumption while Europe accounts for 12% of palm oil trade.
Indonesia and Malaysia are biggest palm oil exporters in world.
 India is largest importer of palm oil in Asia, accounting for 15% of global imports, followed by China, Pakistan,
Bangladesh.
 In India, Palm oil cultivation is mainly concentrated in Andhra Pradesh, Telangana.
→ Initiatives:
 NMEO-OP [2021] to boost India’s domestic palm oil production by 3 times (till 2025-26). Under this NMEO-OP
mission, GOI is focusing on NE and AN Islands.
 Kharif Strategy 2021 for oilseeds.
 Yellow revolution [1986-87].
 Oil Palm Area expansion [under Rashtriya Krishi Vikas Yojana (now Remunerative Approach for Agriculture and
Allied sector Rejuvenation)].
 Increasing MSPs of Oilseed crops.
→ Significance:
 Palm oil accounted for about 33% of global oils produced from oil crops in 2014. Palm oils are easier to stabilize
and maintain quality of flavor and consistency in processed foods, so are frequently favored by food
manufacturers. Demand has increased globally. Palm Oil is not expensive and produces more oil per hectare as
compared to other alternatives such as soybean.
 National Mission on Edible Oil-Oil Palm (NMEO-OP) [2021]:
→ What:
 national initiative on palm oil production. to boost domestic oilseed production. to make India self-sufficient in
cooking oils.
→ Aim:
 to help increase farm incomes. self-reliance in edible oil. control domestic edible oil prices [that are dictated by
expensive palm oil imports]. raise domestic production of palm oil.
→ Features:
 emphasis on NE States, AN Islands [due to conducive weather conditions]. oil palm farmers will be provided
financial assistance.
Page 218 of 719
 → Need:
 India is largest consumer of vegetable oil in world. India’s palm oil imports accounts for maximum of total
vegetable oil imports, imported mainly from Malaysia, Indonesia. India produces meager amount of palm oil of
its requirement. In India, palm oil is used in food products, especially in cooking. This makes palm oil extremely
critical to India’s edible oils economy.
→ Significance:
 It will incentivise production of palm oil [to reduce dependence on imports and help farmers get cash via huge
market].
 Rise of retail edible oil prices in India in 2021:
→ surge in global prices. lower domestic production. excessive buying of edible oil by China. Many oil producers are
pursuing biofuel policies, diverting their edible oil crops to biofuel. Government taxes and duties.
 Asian Palm Oil Alliance (APOA) [2022]:
→ What:
 One alliance formed by edible oil trade association from 5 palm oil importing countries in South Asia – India,
Pakistan, Sri Lanka, Bangladesh, Nepal – in 2022 to gain collecting bargaining power and make imports
sustainable. APOA held its 1st general body meeting in 2022 on sidelines of “Globoil Summit 2022”.
→ Aim:
 Safeguarding economic and business interests of palm oil consuming countries.
 Increasing consumption of palm oil in member countries.
→ Function:
 According to APOA statement, alliance would work towards ensuring that palm oil is recognised as high-quality,
economical, and healthy vegetable oil and to change -ve image of palm oil.
→ Significance:
 Asia accounts for around 40% of global palm oil consumption while Europe accounts for 12% of palm oil trade.
Indonesia and Malaysia are biggest palm oil exporters in world.
Value Addition:
 National Mission on Oil Seeds and Oil Palm was NMEO-OP’s predecessor. National Mission on Oil Seeds and Oil Palm was
merged with National Food Security Mission.
Mains Link:
 Discuss the significance of the scheme.
 Threats posed to the North-Eastern environment because of this proposal and how to combat them
 Why does India have to import edible oils? What is the burden of importing edible oils on the government’s exchequer?
What can we do to boost the domestic production of edible oils? Elaborate.
 Domestically incentivising the farmers to grow edible oil producing plants can decrease dependence on imports. Critically
analyze.

BUREAU OF INDIAN STANDARDS (BIS) [1986]

News:
 2021:
→ Indian Railways becomes nation’s 1st institution to be declared as Standard Developing Organization (SDO) under
“One Nation One Standard” on BIS.
 2022:
→ BIS publishes Test Specifications for Lithium-ion (Li-ion) Traction Battery Packs and Systems (Performance Testing)
for Electric Vehicle.
→ BIS publishes 10 Indian Standards on safety aspects of Toys related to physical safety, safety against chemicals,
flammability, electrical safety.
About:
 What:
→ National Standards Body of India under Department of Consumer affairs, Ministry of Consumer Affairs, Food & Public
Distribution, Government of India. It is statutory body.
→ Its headquarters are in New Delhi, with regional offices in Kolkata, Chennai, Mumbai, Chandigarh and Delhi.
→ It also works as WTO-TBT enquiry point for India.
 Establishment:
→ It was established by Bureau of Indian Standards Act, 1986 and then later made National Standards Body by Bureau
of Indian Standards Act, 2016. It was formerly Indian Standards Institution (ISI).
 Goal:
→ Standardization i.e. only national body that frames standards.
→ Marking and quality certification of goods
 Composition:
→ It has members drawn from Central or State Governments, industry, scientific and research institutions, and
consumer organisations.
 Function:
Page 219 of 719
 → Certification, Hallmarking (e.g., Gold jewellery), Eco Mark (e.g. environmentally friendly products), Compulsory
registration (for electronic items), Laboratory services.
Value Addition:
 International Standards Organizations:
→ International Organization for Standardization (IOS); International Electrotechnical Commission (IEC); International
Telecommunication Union (ITU).

BIOBASED ECONOMY (BBE) / BIOECONOMY (BE) / BIOTECHONOMY

News:
 2022:
→ To mark completion of 10 years of setting up of BIRAC, Biotech Startup Expo – 2022 is launched with theme ‘Biotech
Startup Innovations: Towards AatmaNirbhar Bharat.’
→ BIRAC releases India Bioeconomy Report 2022.
About:
 What:
→ It is economic activity involving use of biotechnology and biomass in production of goods, services, or
energy. Terms are widely used by regional development agencies, national and international organizations,
and biotechnology companies. They are closely linked to evolution of biotechnology industry and capacity
to study, understand, and manipulate genetic material that has been possible due to scientific research
and technological development. This includes application of scientific and technological deve lopments to
agriculture, health, chemical, energy industries.
Terms bioeconomy (BE) and bio-based economy (BBE) are sometimes used interchangeably. However,
it is worth to distinguish them: BBE takes into consideration production of non-food goods, whilst BE covers
both BBE and production and use of food and feed. More than 60 countries and regions have BE or
bioscience-related strategies, of which 20 have published dedicated bioeconomy strategies in Africa, Asia,
Europe, Oceania, Americas.
European Commission defines bioeconomy as production of renewable biological resources and
conversion of these resources and waste streams into value added products, such as food, feed, bio -based
products, bioenergy. Its sectors and industries have strong innovation poten tial due to their use of wide
range of sciences, enabling and industrial technologies, along with local and tacit knowledge.
As per UNFAO, bioeconomy is production, use and conservation of biological resources with aim of
moving towards sustainable economy.
 Aim:
→ To protect environment, avoid overexploitation of natural resources and enhance biodiversity.
 Example:
→ Bioplastics, biofuels, biodegradable clothing, biomass (for energy), natural farming (for food) etc.
 Initiatives:
→ National Mission on Bioeconomy [2016]; National Biopharma Mission (Industry + Academia for indigenous
manufacture in biopharma); Bio-incubators (startups); Bio-clusters (e.g. NCR, Bangalore, Pune etc.); Ethanol blending
target; National Policy on Biofuels.
Note:
 Biotechnology Industry Research Assistance Council (BIRAC):
→ What:
 Interface Agency to strengthen and empower emerging Biotech enterprise to undertake strategic research and
innovation, addressing nationally relevant product development needs. not-for-profit Public Sector Enterprise
set up Department of Biotechnology (DBT), MoS&T.
→ Aim:
 Interface Agency to strengthen and empower emerging Biotech enterprise to undertake strategic research and
innovation, addressing nationally relevant product development needs.
→ Function:
 Providing access to risk capital through targeted funding. Technology transfer. IP management and handholding
schemes that help bring innovation excellence to biotech firms and make them globally competitive.
→ Fact:
 BIRAC implements National Biopharma Mission (NBM) [2017].
 India Bioeconomy Report / IBER:
→ released by BIRAC.
→ IBER 2022 report: Bioeconomy size in India is USD 80bn; BioAgri (e.g. biopesticides, marine biotech, Bt Cotton) will
double its contribution.
 Green enonomy = bioeconomy + bio-based economy + circular economy.
Mains Link:
 What are the research and developmental achievements in applied biotechnology? How will these achievements
help to uplift the poorer sections of the society?(UPSC 2021).
Page 220 of 719
 WILDLIFE / WILD LIFE
News:
 2021:
→ MoEFCC says on elephant casualties by trains, top 3 States: Assam, West Bengal, Odisha.
→ WWF and UNEP releases Future for All Report 2021 on human-wildlife coexistence.
→ Caracal included in list of critically endangered species in India.
→ India is planning to adopt new population estimation protocol in all-India elephant and tiger population survey in
2022. As per new protocol, India will move to system that will count tigers and elephants as part of common survey.
 Reason: About 90% of area occupied by elephants and tigers is common. Thus, new method can save
costs and time.
 Current Tiger survey, Elephant survey: Tiger survey is usually held in 4 years. Elephants are counted in
5 years. States estimates tiger numbers based on sightings in camera traps, indirect estimation
methods. Mainly, elephant numbers are counted directly by States.
→ MoEFCC introduces amendment to Wild Life (Protection) Act, 1972 - Wild Life (Protection) Amendment
Bill, 2021.
 2022:
→ On Wild Life (Protection) Amendment Bill, 2021, Parliamentary Standing Committee on Science and
Technology, Environment, Forests and Climate Change, headed by RS member Jairam Ramesh, gives
recommendations to Central Government. [earlier this Wild Life (Protection) Amendment Bill, 2021 was
referred to this standing committee].
 Recommendation:
• Central Government should not encourage sale and purchase of captive elephants. Issue: One
section of Wild Life (Protection) Act, 1972 (Regulation of transfer of animal, etc.) mentions that no
person having in his possession captive animal, animal article, trophy or uncured trophy in respect
of which he has certificate of ownership shall transfer by way of sale or offer for sale or by any
other mode of consideration of commercial nature, such animal or article or trophy or uncured
trophy. However, this 2021 Bill introduces exemption clause for elephants. That is, u nder this 2021
Bill, commercial sale and purchase of elephants will no longer be prohibited, and this clause is prone to
abuse and can severely impact elephant populations by legitimising live trade of elephants;
• Number of species is missing in all 3 Schedule; Species that should be in Schedule I are placed in
Schedule II; This 2021 Bill also fails to address “human -animal conflict”;
• To reduce human – animal conflict (HAC): This report recommends one HAC Advisory Committee to be
headed by Chief Wild Life Warden, who can consult this committee to act appropriately. Such HAC
committee with few members and in-depth technical knowledge for evolving effective site-specific plans /
mitigation strategies including recommendations on changing cropping patterns and for taking critical
decisions at short notice, empowered under law is necessary.
 Significance:
• While Standing Committee reports on Bills usually stick to criticism of text o f that Bill, this report
devoted space to question of Human Animal conflict — subject not mentioned in this proposed
2021 amendments — as it was “complex issue as serious as hunting” and needed “legislative
backing.”
→ Kerala government empowers local bodies to cull wild boars that pose threat to agriculture crops or human
life. Secretaries of local bodies concerned will act as delegated officers.
→ Written response by MoEFCC in Lok Sabha to one question on human -animal conflict says that between
2018-19 and 2020-21, 222 elephants were killed by electrocution across India, 45 by trains, 29 by poachers
and 11 by poisoning. Among tigers, too, 29 were killed by poaching between 2019 and 2021, while 197
tiger deaths are under scrutiny.
Constitution:
 Article 48A (Protection, improvement of environment and safeguarding of forests, wild life):
→ state shall endeavour to protect, improve environment and to safeguard forests, wild life of India.
 Article 51A (Fundamental duties):
→ It shall be duty of every citizen of India:
 ….
 to protect and improve natural environment including forests, lakes, rivers, wild life, and to have compassion
for living creatures
 ….
About:
 Constitutional:
→ Article 48A in DPSP, says that state shall endeavor to protect, improve environment and to safeguard
forests, wildlife of India.

Page 221 of 719

 → Article 51A says it shall be fundamental duty of every citizen of India to protect and improve natural
environment including forests, lakes, rivers, wild life, and to have compassion for living creatures.
→ 42 nd Constitution Amendment Act, 1976, transferred - Forests; Protection of Wild Animals, Birds - from
State List to Concurrent List.
 Wild Life (Protection) Act, 1972 / WLPA, 1972:
→ What:
 Act to provide for protection of wild animals, birds, and plants and for matters connected therewith or ancillary
or incidental thereto with view to ensuring ecological and environmental security of India. This Act regulates
protection of wild animals, birds, plants.
→ Why:
 The Act was enacted for the protection of plants and animal species
→ Feature:
 Establishment of: National Board for Wildlife (NBW); State Board for Wildlife (SBW); Central Zoo Authority;
NTCA.
 State Wildlife Advisory Boards; regulations for hunting wild animals, birds; establishment of sanctuaries, national
parks; regulations for trade in wild animals, animal products, trophies; judicially imposed penalties for violating
1972 Act; Harming endangered species listed in Schedule I of 1972 Act is prohibited throughout India; Hunting
species, like species under special protection (Schedule II), big game (Schedule III), small game (Schedule IV), is
regulated through licensing; Few species classified as vermin (Schedule V), may be hunted without restrictions;
Wildlife wardens, their staff to administer 1972 act; Permits capture, transportation of wild animals for scientific
management of animal population.
 Prohibition of hunting:
• This Act prohibits hunting of any wild animal specified in Schedules I, II, III and IV of this Act. Exception: Wild
animal listed under said schedules can be hunted / killed only after getting permission from State Chief
Wildlife Warden if:
 That wild animal becomes dangerous to human life or to property (including standing crops on any
land).
 That wild animal is disabled or suffering from disease that is beyond recovery.
 This Act prohibits uprooting, damage, collection, possession or selling of any specified plant from any forest land
or any protected area.
• Exception: State Chief Wildlife Warden, however, may grant permission for uprooting or collecting specific
plant for purpose of education, scientific research, preservation in herbarium or if person / institution is
approved to do so by central government.
 Government can declare area (including area within sanctuary) as National Park. One Collector is appointed by
central government to administer area declared as Sanctuary. Under this Act, States can send list of wild animals
to Centre requesting it to declare them vermin for selective slaughter.
→ Fact:
 1072 WLPA contains 6 Schedules / lists, at end of 1972 Act. These schedules describe protections or
management actions applicable to different species (basis for classification isn’t included). Central
Government appoints Director of Wildlife Preservation, Min. of Environment, and assistant directors
and other officers subordinate to Director. State Government appoint Chief Wildlife Warden who heads
Wildlife Wing within State. State government also appoints Wildlife Warden in each district
 Integrated Development of Wildlife Habitats (IDWH), 2008-09:
→ What:
 Centrally sponsored Scheme
→ Aim / Component:
 support to Protected Areas [National Parks, Wildlife Sanctuaries, Conservation Reserves & Community Reserves
except tiger reserves (Project Tiger), etc]. Protection of Wildlife outside Protected Areas. Recovery Program for
critically endangered species and habitats (Species Recovery Programme).
→ Agency:
 National Board for Wildlife (NBWL) and Union Ministry of Environment, Forest and Climate Change (MoEFCC)
includes species into list of Species Recovery Programme.
 Recovery Program for critically endangered species and habitats (Species Recovery Programme):
→ Caracal, Brow-antlered deer (Manipur), Snow leopard, Bustard, Dolphin, Marine turtles, Dugongs, Asian
wild buffalo, Vulture, Malabar Civet, Indian Rhino, Asiatic Lion, Swamp deer, Jerdon’s Courser, ...
 Human-Animal conflict / Human Animal conflict / Human - Animal conflict / Human-Wildlife conflict / Human Wildlife
conflict / Human - Wildlife conflict:
→ What:
 Human-wildlife conflict refers to interaction between wild animals and people and resultant -ve impact on
people or their resources or wild animals or their habitat. It occurs when growing human / animal populations

Page 222 of 719

 overlap with established wildlife / human territory, creating reduction of resources or life for some people and
/ or wild animals.
→ Issue:
 India will be most-affected by human-wildlife conflict because it has world’s 2 nd -largest human
population and large populations of tigers, Asian elephants, one -horned rhinos, Asiatic lions and other
species.
 Human-Tiger conflict.
 Human-Elephant conflict: Humans and elephants are killed in encounters. Crops and property are damaged by
elephants. In recent years, many elephants were killed due to human-elephant conflict. India will be most-
affected by human-elephant conflict because India has: world’s 2nd-largest human population; and large
populations of Asian elephants.
→ Status [as of 2022]:
 Elephant: Between 2018-19 and 2020-21, 222 elephants were killed by electrocution across India, 45 by trains,
29 by poachers and 11 by poisoning. Tigers: Among tigers, too, 29 were killed by poaching between 2019 and
2021, while 197 tiger deaths are under scrutiny. Human casualties: Elephants killed 1,579 humans in 3 years —
585 in 2019-20 (most in Odisha) and Tigers killed 125 humans (2019- 2021) - most in Maharashtra.
→ Causes:
 Habitat loss, growth of population of wild animals, changing cropping patterns that attract wild animals to
farmlands, movement of wild animals from forests area to human-dominated landscapes for food and fodder,
movement of human beings to forests for illegal collection of forest produce, habitat degradation due to growth
of invasive alien species, etc. Encroachment: People are increasingly encroaching into traditional wild spaces,
animal sanctuaries [people compete with wildlife for food, other resources]. Unsustainable development:
Animal corridors blocked by highways, railway tracks, factories. It results in ecological dislocation and as such,
endangered wild animals (tigers etc) cause distress or land themselves in trouble. Failure of government
measures: Human-Wildlife Conflict (HWC) mitigation measures are dysfunctional, not properly implemented,
not effective. Animals outside protected areas: Wildlife experts claim that territorial animals do not have enough
space within reserves and their prey do not have enough fodder to thrive on; Wildlife experts estimate about
30% of tigers in India are outside protected areas.
→ Impact:
 Loss of Human life; Impacts local communities who depend on forest; Injuries to wildlife; Livestock depredation;
hurts ecosystem, biodiversity.
→ Way Forward:
 Future for All Report 2021 [jointly published by WWF and UNEP] titled: Future for all – need for human-wildlife
co-existence suggests one approach of coexistence between humans and wildlife, and involvement of local
communities, as it is not possible to wholly suppress human-wildlife conflict.
 Case study: Kavango–Zambezi Transfrontier Conservation Area (one regional park) in Southern Africa wherein
local communities installed fixed and mobile Lion-proof corrals (fence) for night-time protection in risk-prone
areas, which led to 95% reduction in livestock killings in 2016, and there were 0 retaliatory killings of lions in
2016.
 Community Participation: Full participation of local communities can help reduce HWC and lead to coexistence
between humans and wildlife. Periodic awareness campaigns to sensitize guide and advise general public on
man-animal conflict, including dissemination of information through various forms of media. It is necessary to
include +ve interactions, coexistence, and attitudes of tolerance toward wildlife.
 Skill-development programs for people living in and around forest would offer them better opportunities for
self-employment and consequently reduce combined pressures on agricultural land as well as forest land.
 Specific targets for coexistence must be key elements within CBD’s Global Biodiversity Framework. Global
leaders such as those at COP work hand-in-hand with local communities and other stakeholders across Asia and
world to secure future in which Wildlife and people live in harmony.
 Implementing WII Guidelines “Eco-Friendly Measures to Mitigate Impacts of Linear Infrastructure on Wildlife”:
These WII guidelines suggest modification in designs of linear infrastructures by way of providing eco-friendly
structure that will ensure safe movement of wildlife across these linear infrastructures.
 Completely eradicating human-animal conflict would be very difficult. But well-planned, integrated approaches
to managing it can reduce conflicts and lead to coexistence between people and animals. adoption of early
warning systems. creation of barriers. Control Rooms with toll free numbers, operating 24X7.
 Railways:
• Set up permanent coordination committee between Ministry of Railways and MoEFCC. Clearing of
vegetation along railway tracks so as to enable clear view for locomotive pilots. Using signal boards at
suitable points to alert locomotive pilots about animal presence. Setting up underpass / overpass for safe
passage of animals. Regulation of train speed during night in vulnerable places. Regular patrolling of
vulnerable places of railway tracks by frontline staffs of Forest Department, wildlife watchers.
 National Board for Wildlife (NBWL) guidelines; MoEFCC Guide on human-elephant conflict; Elephant Corridor;
Sonitpur Model; Eco Bridge / Eco-Bridge.
Page 223 of 719
  National Board for Wildlife (NBWL):
→ What:
 apex body for conservation of wildlife and its habitat. statutory board. constituted under Wild Life
(Protection) Act, 1972.
→ Composition:
 Prime Minister – head; Environment Minister - vice chairperson; …
→ Significance:
 NBWL’s role is of critical importance to ensure long-term protection of India’s biodiversity.
 Wildlife Crime Control Bureau (WCCB):
→ What:
 statutory body. under Wild Life (Protection) Act, 1972. MoEFCC.
→ Aim:
 combat organized wildlife crime in country.
→ Mandate:
 intelligence / information related to organized wildlife crime activities. Coordinate with other enforcement
agencies. Establish wildlife crime data bank. Assist international organizations for wildlife crime control.
Note:
 National Board for Wildlife (NBWL) guidelines:
→ Empower gram panchayats in dealing with problematic wild animals as per WildLife (Protection) Act, 1972.
Utilise Pradhan Mantri Fasal Bima Yojna (PMFBY) for crop compensation against crop damage due to HWC. Increase
fodder, water sources within forest areas. Inter-departmental committees at State / local level.
 MoEFCC Guide on human-elephant conflict:
→ Create water sources. Management of forest fires. Elephant-Proof trenches. Fences and walls. Playing sound of bees
or carnivores. Chili smoke. Technology: Individual identification, monitoring of elephants, sending SMS alerts of
elephant presence.
 Elephant Corridor:
→ What:
 Narrow strips of land that connect 2 large habitats of elephants.
→ Need:
 Elephant are forced to find alternate routes. elephant-human conflict. for genetically viable elephant population.
regenerate forest and forest wildlife. vulnerable elephant reserves. Forest turned into farms and tourism are
blocking animal paths. fragmentation of forests.
→ Issues:
 Encroachment on elephant corridors. Highways passing through. Railway lines passing through.
→ Significance:
 reduce animal fatalities- accidents etc.
 Sonitpur Model:
→ During 2003-04, WWF India developed ‘Sonitpur Model’ by which community members worked with Assam forest
department. Community members were given training on how to drive elephants away from crop fields safely. WWF
India also developed non-lethal electric fence to ease guarding of crops from elephants.
 Eco Bridge / Eco-Bridge:
→ What:
 also known as wildlife crossing. wildlife corridors, over-bridge built over roads, railway tracks etc. with plantation
of plants, trees, shrubs on it, that connects two larger areas of similar wildlife habitat.
→ Aim:
 Enhancing wildlife movement / connectivity
→ Need:
 Wildlife connectivity disruption because of highways, logging. Many road projects cut across animal corridors
(National Highway through Kaziranga NP, Assam etc.)
→ Feature:
 Plantation of native vegetation (planting from that area) so as to give contiguous look with landscape. Links
between two wildlife habitats. connects wildlife populations [that would otherwise be separated by human
activities, human built structures – roads, highways, logging, farming etc].
→ Examples:
 canopy bridges - monkeys, squirrels, arboreal animals etc. underpasses or overpass tunnels - larger animals.
amphibian tunnels.
→ Significance:
 Enhance wildlife connectivity.
 2021 WWF and UNEP report on Human-wildlife conflict:
→ Conflict between humans and animals is one of main threats to long -term survival of some of world’s most
iconic species. Globally, conflict-related killing affects world’s wild cat species, polar bears, Mediterranean
Page 224 of 719
 monk seals, large herbivores such as elephants. Global wildlife populations fell by average of 68% since
1970.
 Wild Life (Protection) Amendment Bill, 2021:
→ What:
 2021 Bill to amend Wild Life (Protection) Act, 1972.
→ Objective:
 2021 Bill seeks to increase species protected under 1972 law, and implement Convention on International Trade
in Endangered Species of Wild Fauna and Flora (CITES).
→ Features:
 CITES:
• 2021 Bill seeks to implement some provisions of CITES.
 Rationalising schedules:
• [Currently, 1972 Act has 6 schedules for: specially protected plants; specially protected animals; vermin
species (small animals that carry disease, destroy food)].
• 2021 Bill reduces number of schedules to 4 by: reducing number of schedules for specially protected
animals; removing schedule for vermin species; inserting new schedule for specimens listed in CITES.
 Obligations under CITES:
• 2021 Bill provides for central government to designate:
 Management Authority:
o to grant export or import permits for trade of specimens; Every person engaging in trade of
scheduled specimen must report details of transaction to Management Authority; [As per CITES,
Management Authority may use identification mark for specimen]; 2021 Bill prohibits any person
from modifying or removing identification mark of specimen. Every person possessing live
specimens of scheduled animals must obtain registration certificate from Management Authority.
 Scientific Authority:
o to give advice on aspects related to impact on survival of specimens being traded.
 Invasive alien species:
• 2021 Bill empowers central government to regulate or prohibit import, trade, possession, proliferation of
invasive alien species. [Invasive alien species are plant or animal species which are not native to India and
whose introduction may adversely impact wild life or its habitat]. 2021 Bill says central government may
authorise officer to seize, dispose invasive species.
 Control of sanctuaries:
• [1972 Act entrusts Chief Wild Life Warden to control, manage, maintain all sanctuaries in State. Chief Wild
Life Warden is appointed by State government]. 2021 Bill specifies that actions of Chief Warden must be in
accordance with management plans for sanctuary. Said management plans will be prepared as per
guidelines of central government, and as approved by Chief Warden. For sanctuaries falling under special
areas, management plan must be prepared after due consultation with concerned Gram Sabha. Special
areas include - Scheduled Area, areas where Scheduled Tribes and Other Traditional Forest Dwellers
(Recognition of Forest Rights) Act, 2006 is applicable. [Scheduled Areas are economically backward areas
with predominantly tribal population, notified under 5 thSchedule].
 Conservation reserves:
• [Under 1972 Act, State governments may declare areas adjacent to national parks, sanctuaries as
conservation reserve, for protecting flora and fauna, and their habitat]. 2021 Bill empowers central
government to also notify conservation reserve.
 Surrender of captive animals:
• 2021 Bill provides for any person to voluntarily surrender any captive animals or animal products to Chief
Wild Life Warden. No compensation will be paid to said person for surrendering such items. Surrendered
items become property of State government.
 Penalties:
• [1972 Act prescribes imprisonment terms and fines for violating 1972 Act]. 2021 Bill increases 1972 Act
fines.
→ Positives:
 2021 Bill increases penalties for wildlife crimes. New and separate chapter on regulating species involved in
international trade according to CITES treaty. 2021 Bill prohibits possessing, trading, breeding species without
prior permissions from CITES authorities. 2021 Bill recognises threats that invasive alien species pose.
→ Concerns:
 2021 Bill doesn’t include regional invasive species – some of which may be native to India but invasive in some
parts. 2021 Bill has no separate Schedule for species 1972 Act classifies as ‘vermin’. This means, Centre can
directly notify vermin species and open them up to be hunted. 2021 Bill’s 2 main substitute Schedules that will
specify protected species are incomplete. 2021 Bill will make existing ‘State Boards for Wildlife’ defunct by
replacing it with ‘Standing Committee’ of State Board of Wildlife – headed by respective State forest minister.

Page 225 of 719

 [State Boards of Wildlife (SBW) currently manage conservation, protection of wildlife at State level. State Chief
Minister heads SBW]. Under 2021 Bill, commercial sale and purchase of elephants will no longer be prohibited.
This clause is prone to abuse and can severely impact elephant populations by legitimising live trade of
elephants.
 In 2022, Parliamentary Standing Committee on Science and Technology, Environment, Forests and
Climate Change recommended Central Government below points:
• Central Government should not encourage sale and purchase of captive elephants.
• Number of species is missing in all 3 Schedules.
• Species that should be in Schedule I are placed in Schedule II.
• This 2021 Bill also fails to address “human-animal conflict”.
→ Significance:
 2021 Bill is likely most expansive so far in scope. It covers more areas of legislation (example trade in wild species,
permitting filmmaking in protected areas, controlling spread of invasive species, etc).
 Caracal:
→ IUCN – VU. mentioned in Abul Fazl’s Akbarnama.
Value Addition:
 Protected Planet Report – by UNEP, IUCN.
Mains Link:
 Conflict between people and animals is one of the main threats to the continued survival of many species.
Analyse the causes behind rising cases of man-animal conflict. (15M)
 What are the major causes of Man – wildlife conflicts? What are the ways to prevent human -animal conflicts?
Explain. (250 words)

LEOPARD
News:
 2021:
→ Environment Ministry released report on “Status of Leopards”.
→ Odisha plans DNA profiling for leopards.
→ International Snow Leopard Day observed on 23 Oct.
→ As per one study by ZSI, Snow leopard regulates population of its herbivores prey species (Siberian ibex,
blue sheep). ZSI Findings:
 Snow leopard detection probability was high if site was used by its prey species. Indicator species and flagship
species: Snow leopards act as indicator of health of mountain ecosystem in which they live, due to their position
as top predator in food web. Threats: loss of natural prey species, retaliatory killing due to conflict with humans
and illegal trade of its fur and bones. Habitat: Snow leopards use rugged mountainous areas or non-forested
areas covering altitude between 3200m - 5200m. Habitat covariates, such as barren area, grassland, aspect,
slope, distance to water were important drivers of habitat use for snow leopard as well as its prey species.
About:
 Panthera pardus.
 Protection:
→ Schedule I of Indian Wildlife (Protection) Act, 1972. Appendix I of CITES. IUCN Red List - VU.
 Native:
→ Africa, Asia.
 Challenges:
→ habitat loss; degradation; Poaching; conflict with communities.
 Initiative:
→ 2013 Bishkek Declaration:
 Protect at least 20 snow leopard landscapes with viable snow leopard populations by 2020. It led to formation
of Global Snow Leopard and Ecosystem Protection Program (GSLEP)
→ International Snow Leopard Day.
 October 23. each year. adoption of 2013 Bishkek Declaration.
→ Global Snow Leopard and Ecosystem Protection Programme (GSLEP) [2013]:
 address high-mountain development issues using conservation of snow leopard as flagship.
 India:
→ 2021 “Status of Leopards” report of Environment Ministry says rise in population. India now has around 13000.
Major population in: Madhya Pradesh, Karnataka, Maharashtra.
→ Threat:
 One international study says leopard faces increased risk of extinction in North India due to roadkill.
→ Initiative:
 Project Snow Leopard (PSL), 2009:

Page 226 of 719

 • to promote inclusive and participatory approach so as to conserve snow leopards and their habitats. Local
communities are involved.
 SECURE Himalaya:
• to conserve high altitude biodiversity. to reduce dependency of local communities on natural ecosystem.
funded by Global Environment Facility (GEF)- UNDP.
 India is party to Global Snow Leopard and Ecosystem Protection (GSLEP) Programme.
 India has identified 3 large landscapes:
• Hemis-Spiti landscape (Ladakh and Himachal Pradesh)
• Nanda Devi landscape (Uttarakhand)
• Khangchendzonga landscape (Sikkim and Arunachal Pradesh).
 included in Recovery Program for critically endangered species and habitats (Species Recovery Programme)
under Integrated Development of Wildlife Habitats (IDWH), 2008-09 of Ministry of Environment Forest &
Climate Change.
 Community volunteer programme “Himal Sanrakshak” to protect snow leopards
 Snow Leopard:
→ It is one elusive mountain cats.
→ Protection: IUCN – VU; Schedule I of Indian Wildlife (Protection) Act 1972 ; Appendix I of CITES; CMS.
→ Habitat – Cold high mountains (central Asia etc.)
→ Range:
 Central Asia; Afghanistan; Bhutan; China; India; Nepal; Pakistan; Russia.
→ India:
 About 500 snow leopards. western Himalayas (JK, Ladakh [Hemis NP is known for presence of Snow
Leopard], Himachal Pradesh, Uttarakhand). eastern Himalayas (Sikkim, Arunachal Pradesh).
Note:
 2021 “Status of Leopards” report:
→ by Environment Ministry
 DNA Profiling for Leopards:
→ It will help ascertain and trace origin in case of deaths of leopards, after skin and other organs from
poachers and traders are seized. It will strengthen fight against wildlife crimes, especially poaching of
leopards.
 No separate census for leopard is conducted. Quadrennial (4 years) tiger survey also estimates population of other
animals, including leopards by relying on camera trap images.
Value Addition:
 Snow Leopard Trust:
→ to protect Snow leopard through community-based conservation projects that are based on improved
scientific understanding of snow leopard behavior, needs, habitats and threats.
 Conservation Assured | Tiger Standards (CA|TS) [2013]:
→ accreditation tool of global coalition of Tiger Range Countries . set of criteria which allows tiger sites to
check if their management will lead to successful tiger conservation. Global Tiger Forum (GTF) and World
Wildlife Fund India are two implementing partners of National Tiger Conservation Authority for CA|TS
assessment in India. 14 Indian tiger reserves received accreditation of CA|TS : Manas, Assam; Kaziranga,
Assam; Orang, Assam.
Mains Link:
 Discuss why a separate census is necessary for the estimation of leopards in India.
 Comment on national level efforts to conserve the snow leopard species in India.

COMMERCE
News:
 2022:
→ Rajya Sabha Department Related Parliamentary Standing Committee on Commerce releases one report –
“Promotion and Regulation of E-Commerce in India”.
→ Microsoft becomes 1st tech giant to onboard Open Network for Digital Commerce (ONDC), one government backed
initiative to give small merchants across India access to decentralised e-commerce network.
About:
 E- Commerce:
→ e-commerce market:
 Models:
• B2B E-commerce: Entity sells product to other businesses who then sells it to consumers. E.g. India Mart,
Trade India.
• Inventory Based Model of e-commerce: Inventory of goods and services are owned by e-commerce entity
and sold to consumers directly. Eg, BATA, Reliance Digital.

Page 227 of 719

 • Market Place Model of E-commerce: Entity acts just as facilitator between buyers and sellers. Eg, Amazon,
Flipkart.
→ Initiative:
 Open Network for Digital Commerce (ONDC) [2021].
Note:
 Open Network for Digital Commerce (ONDC) [2021]:
→ What:
 One private non-profit company established by Department for Promotion of Industry and Internal Trade (DPIIT)
of Ministry of Commerce and Industry to develop open e-commerce. ONDC is not application, intermediary, or
software, but set of specifications designed to foster open interchange and connections between shoppers,
technology platforms, and retailers.
 ONDC is one network based on open protocol and will enable local commerce across segments, such as mobility,
grocery, food order and delivery, hotel booking and travel, among others, to be discovered and engaged by any
network-enabled application. It is one open-source platform and will work in e-commerce, similar to what UPI
does in digital payment. Integration of platform will be provided by Quality Council of India (QCI).
→ Aim:
 This platform aims to create new opportunities, curb digital monopolies and supports MSME and help them get
on online platforms. ONDC is aimed at decentralizing and democratizing digital commerce.
→ Establishment:
 It was created in view of technological self-reliance, demand for level playing field mainly from small retailers,
lower barrier of entry and discovery online, adoption of open digital ecosystem across key sectors and fixing
non-competitive behavior of big ecommerce firms like Amazon and Flipkart to capture billion-dollar domestic
retail market.
→ Need:
 There has been rising dominance of global players in India’s e-commerce, which makes entry of smaller players
difficult. ONDC eyes at transforming from operator-driven platform-centric model to facilitator-driven
interoperable open network model.
→ Function:
 To keep check on Big Tech companies from violating Consumer Protection (E-Commerce) (Amendment) Rules,
2021 due to concentration of market power by integrating them into open-source decentralized network where
data portability will break data silos while data interoperability will allow innovation. ONDC will allow small
merchants and mom-and-pop stores in India to access consumers (similar to those done by Amazon, Flipkart).
 “Promotion and Regulation of E-Commerce in India” [2022]:
→ What:
 It is one report released in 2022 by Rajya Sabha Department Related Parliamentary Standing
Committee on Commerce.
→ Issues highlighted:
 Few platforms control large part of e-commerce market (which may lead to monopoly). Lack of
platform neutrality, i.e., providing preferential treatment to selected sellers. Deep discounting i.e.
discounts of preferred sellers are selectively funded by platform. Non -transparent search rankings.
Misuse of data.
→ Its recommendations:
 Formulate one policy which clearly defines marketplace and inventory-based models of e-commerce;
Marketplace-commerce entities should: not sell goods that it owns or controls , and not have any direct
or indirect relationship with sellers who sell on platform, and be prohibited from licensing their brand
to 3 rd -party sellers on platform; Gatekeeper entities: Certain e-commerce platforms need greater
scrutiny (as is applicable in other countries). India should select “gatekeeper” platforms of specific
scale that require more stringent supervision ; Mandatory registration of e-commerce companies with
DPIIT; Create Digital Market Division to overcome regulatory gaps ; Implement Personal Data
Protection Bill, 2019; DPIIT should address issues such as maintaining level playing field between small
businesses and e-commerce giants and provide technical support to small and local businesses ;
Obligations put on e-commerce entities through Consumer Protection (E-Commerce) Rules, 2020 (such
as appointment of Chief Compliance Officer, and setting up grievance redressal mechanism) should be
applicable to those entities above certain threshold, and thereby putting compliance burden on new
e-commerce entities.
Question:
 With reference to foreign-owned e-commerce firms, operating in India, degree to which they can own big sellers on their
platforms is limited (to maintain level playing field). As per FDI policy changes, foreign firms are prevented from holding
inventory or selling their own goods, which both Amazon and Walmart do in other markets. They can offer their platforms
only as “marketplaces” for other buyers and sellers.

MAIZE
Page 228 of 719
About:
Question:
 Maize can be used for production of starch. Oil extracted from maize can be feedstock for biodiesel. Alcoholic beverages
can be produced by using maize.

WAREHOUSE
News:
 2022:
→ MoCAFPD suggests major amendments to Warehousing (Development and Regulation) Act, 2007.
 Aim: Changes are aimed to help farmers get access to service of quality warehouses.
 Issue: Samyukt Kisan Morcha (SKM) (one farmer’s organization) fears that amendments are for bringing back
certain provisions of one repealed controversial Farmer Act through backdoor.
About:
 What:
→ It is one building for storing goods. Warehouses are used by manufacturers, importers, exporters,
wholesalers, transport businesses, customs, etc. They are usually large plain buildings in industrial parks
on outskirts of cities, towns, or villages. They usually have loadin g docks to load and unload goods from
trucks. Sometimes warehouses are designed for loading and unloading of goods directly from railways,
airports, or seaports. They often have cranes and forklifts for moving goods, which are usually placed on
ISO standard pallets and then loaded into pallet racks. Stored goods can include any raw materials, packing
materials, spare parts, components, or finished goods associated with agriculture, manufacturing, and
production. In India, Hong Kong etc, warehouse may be ref erred to as "godown".
Warehouses are scientific storage structures especially constructed for protection of quantity and
quality of stored products.
 Warehouse receipt:
→ It is one document that provides proof of ownership of commodities (e.g., bars of copper) that are stored
in warehouse, vault, or depository for safekeeping. Warehouse receipts may be negotiable or non -
negotiable. Negotiable warehouse receipts allow transfer of ownership of that commodity without having
to deliver physical commodity. Most warehouse receipts are issued in negotiable form, making them
eligible as collateral for loans. Non-negotiable receipts must be endorsed upon transfer. Warehouse
receipts also guarantee existence and availability of commodity of particular quantity, type, and quality in
named storage facility. It may also show transfer of ownership for immediate delivery or for delivery at
future date. Rather than delivering actual commodit y, negotiable warehouse receipts are used to settle
expiring futures contracts. Warehouse receipts may also indicate ownership of inventory goods and / or
unfinished goods stored in warehouse by manufacturer or distributor.
 Status:
→ At present, there are about 60,000 warehouses in India.
Note:
 Warehousing Development and Regulatory Authority (WDRA) [2010]:
→ It was constituted in 2010 under Warehousing (Development and Regulation) Act, 2007, under Department
of Food and Public Distribution to ensure scientific storage by prescribing infrastructural and procedural
standards.
 Negotiable Warehouse Receipt (NWR) System [2011]:
→ It was launched in 2011. Through it farmers can seek loans from banks against warehouse receipts issued
to them against their storage. Electronic NWR (e-NWR) System was launched in 2017.
Question:
 Warehouse Receipts are documents issued by warehouses to depositors against commodities deposited in warehouses,
for which warehouse is bailee. Warehouse Receipts issued by registered warehouses would help farmers to seek loans
from banks against receipts. Warehouse Receipt is proof of storage. It is acknowledgement of goods held by warehouse
keeper on behalf of person named therein. It is document issued by warehouse keeper stating that he holds goods
mentioned in receipt and is awaiting instructions from person to whom it is addressed. It is mere deposit receipt. Banker
can accept it as security to grant loans.

OPTICAL COMMUNICATION / OPTICAL TELECOMMUNICATION

News:
 2021:
→ NASA launches its Laser Communications Relay Demonstration (LCRD).
 2022:
→ The Myanmar/Malaysia-India-Singapore Transit cable will land at M.R.C. Nagar in Chennai
→ Expert Appraisal Committee (EAC) of MoEFCC suggests GOI create one appropriate corridor for laying submarine
cable systems in coastal area for better management and to avoid conflict with various stakeholders considering
increasing number of international cable landing on Chennai coast. EAC recommended CRZ clearance for proposal to
Page 229 of 719
 lay one submarine cable system spanning 8,100 km for Myanmar/Malaysia-India-Singapore Transit (MIST) landing in
Chennai and Versova in Mumbai.
About:
 What:
→ communication at distance using light to carry information. It can be performed visually or by using electronic
devices. Earliest basic forms of optical communication date back several millennia. [while earliest electrical device
created to do so was photophone, invented in 1880].
Optical fiber is medium for transfer of data using light pulses travelling through long strands of thin fibre. It
works on principle of total internal reflection (TIR). Optical cables are such that they bend all light rays inwards using
TIR.
 Laser communication in space:
→ What:
 use of free-space optical communication in outer space. Communication may be fully in space (inter-satellite
laser link) or in ground-to-satellite or satellite-to-ground application. Optical communications uses infrared
lasers to send data to and from space
→ Advantage:
 Increased bandwidth over radio waves (10 to 100 times), thereby enabling transfer of more data in less time.
In outer space, its communication range is currently of about thousands of kilometers, thereby suitable for inter-
satellite service. It has potential to bridge interplanetary distances of millions of kilometers, using optical
telescopes.
 Fiberisation:
→ What:
 It is one process of connecting radio towers via optical fibre cables, thus facilitating flow of large amount of data
to be used in 5G services.
→ Issue:
 Low fiberasition: Compared to USA, UK, Japan (80-90% fiberisation), India has just 33% of towers fiberized, which
is becoming hurdle in India transitioning to 5G network.
 Low funding: India requires huge amount of funding to fiberize 70% of towers.
 Slow speed of fiberization.
→ Solution:
 Satellite-based networks (along with on-ground optical fibre networks) can help reduce dependence on
fiberization and deliver 5G broadband to users on moving vessels, including cars, ships, aeroplanes, high-speed
trains.
→ Initiative:
 Amendment in Indian Telegraph Right of Way Rules 2016, to make it easier to install aerial optical fibre cable.
However, several States and local bodies have not agreed to this RoW rules.
 GatiShakti Sanchar Portal: This portal of DoTs will simplify approvals of RoW and granting of compensation.
 BharatNet: Vision to connect every village with optical fibre cable in 1000 days.
 Advantages:
→ Optical communications systems are smaller in size, weight, require less power compared with radio instruments.
Smaller size means more room for science instruments. Less weight means less expensive launch. Less power means
less drain on spacecraft’s batteries.
 Significance:
→ Optical communications and radio communications together will make missions with unparalleled communications
capabilities.
Note:
 Submarine Communications Cable:
→ What:
 It is one cable laid on sea bed between land-based stations to carry telecommunication signals across stretches
of ocean and sea. coated with plastic layers and contained in protective tube.
→ Evolution:
 1st submarine communications cables laid beginning in 1850s carried telegraphy traffic, establishing 1st instant
telecommunications links between continents, such as 1st transatlantic telegraph cable which became
operational in 1858. Subsequent generations of cables carried telephone traffic, then data communications
traffic. Modern cables use optical fibre technology to carry digital data, which includes telephone, Internet and
private data traffic.
Modern cables are typically for deep-sea sections, and larger and heavier cables are used for shallow-
water sections near shore. Submarine cables 1st connected all world's continents (except Antarctica).
→ Feature:
 High reliability. High carrying capacity - terabits per second> that of Satellite signals. Lower latency.
→ Types:

Page 230 of 719

  Unrepeatered cable: preferred in short routes. does not require repeaters. lower costs. limited transmission
distance.
 Repeatered cable: long distance. need repeaters. Costlier.
→ Challenges:
 High cost to construct oceanic submarine cable system.
→ Significance:
 In India, it carries almost all ocean-crossing data traffic. large bandwidth. Better connectivity: delivery of e-
governance services; telemedicine; tele-education etc.; e-commerce; e-learning; Business, enterprises; Low
internet bills.
→ India:
 Chennai-Andaman &Nicobar Island Submarine Cable System. Lakshadweep Submarine Cable System.
 Laser Communications Relay Demonstration (LCRD) [2021]:
→ NASA’s next step in optical communications. NASA’s 1st-ever laser communications system. LCRD will help NASA test
optical communication in space. LCRD will let NASA collect more science data and explore farther into universe than
ever before. LCRD is technology demonstration that will pave way for future optical communications missions. LCRD
will be placed in geosynchronous orbit.
 Laser:
→ Light Amplification by Stimulated Emission of Radiation. device that emits light through process of optical
amplification based on stimulated emission of electromagnetic radiation. 1 st laser was built in 1960 by Theodore H.
Maiman at Hughes Research Laboratories (USA) [based on theoretical work by Charles Hard Townes, Arthur Leonard
Schawlow]. Laser communications can significantly accelerate data transfer process, thereby empowering more
discoveries. Laser communications and radio waves use different wavelengths of light. Laser uses infrared light. Laser
has shorter wavelength than radio waves, thereby help laser transmission of more data in less time.
 Laser vs Radio:
→ Laser communications and radio waves use different wavelengths of light. Laser uses infrared light. Laser has shorter
wavelength than radio waves, thereby help laser transmission of more data in less time.
 Myanmar/Malaysia-India-Singapore Transit (MIST):
→ One submarine cable system spanning 8,100 km landing in Chennai and Versova in Mumbai. MIST is one international
submarine cable communication network that will traverse undersea to connect India with countries such as
Myanmar, Thailand, Malaysia, Singapore. It will provide secure, reliable, robust and affordable telecom facilities in
Asia with main trunk route being from Tuas in Singapore to Mumbai in India. At Chennai, this cable will land at
Santhome beach and will terminate at proposed Beach Man Hole (BMH) to be constructed from where it will then
be taken for distribution. In Mumbai, this cable will land at Versova beach. MIST will deliver design capacity of more
than 216 terabits per second (Tbps).
Mains Link:
 Discuss the significance of NASA’s LCRD.

DESERTIFICATION
News:
 2021:
→ High-Level Dialogue on Desertification, Land Degradation and Drought (DLDD) was conducted, with help
of UNCCD.
→ ISRO publishes Desertification and Land Degradation Atlas of India.
→ Shyam Sundar Jyani, Rajasthan-based climate activist, wins prestigious UN Land for Life Award, 2021 for
his environment conservation concept - Familial Forestry.
→ Punjab could turn into desert in next 25 years if present trend of drawing water from underground aquifers
continues.
→ FAO releases report - State of world’s land and water resources for food and agriculture.
 2022:
→ Drought in Numbers, 2022 report released at ongoing 15 th Conference of Parties (CoP15) to UNCCD in Cote
d’Ivoire (Ivory Coast) in Western Africa. India is taking part in this 15 th session of COP of UNCCD.
→ MGNREGS will fund work to reverse desertification of land across States. This employment scheme will
work in tandem with Pradhan Mantri Krishi Sinchayee Yojana to help take up treatment of about 30% more
land than feasible with current scheme size. With limited funds to deal with big task of restoring degraded
land and reversing desertification in India, GOI is now planning to bring convergence between MGNREGS
and Pradhan Mantri Krishi Sinchayee Yojana (PMKSY).
About:
 3 Types of drought:
→ Meteorological drought (actual rainfall is significantly less than climatological mean);
→ Hydrological drought (marked depletion of surface water);
→ Agriculture drought (low soil moisture leading to acute crop stress) .
 Reason:
Page 231 of 719
 → More water is being drawn from underground than it is being replenished. Faulty cropping pattern. Paddy
crop hampers water recharging because of puddling method used to prepare fields for transplanting.
 Need for healthy land:
→ Land is foundation of our societies. Land is cornerstone to global food security, environmental health, zero
hunger, poverty eradication, affordable energy. Land supports 2030 Agenda for Sustainable Development.
 Dry Land:
→ Large Arid regions are found in desert of Rajasthan, Rann of Kutch, semi -arid regions of Punjab, Gujarat,
rain shadow areas of Western Ghats. One AAI report says nearly 69% of India is dry land.
 Challenges:
→ 1/5 th of earth’s land area – degraded. Half of all earth’s agricultural land - degraded. By 2050, about 90%
of earth’s land area could become degraded. [unless proper soil management is executed]. Land
degradation hurts about 40% of global population. Land degradation accelerates climate change,
biodiversity loss. Land degradation cause droughts, wildfires, involuntary migration, zoonotic infectious
diseases. Threatens food security. India’s drought-prone area has increased by 57% since 1997. 1/3rd of India’s
districts have faced more than many droughts over past decade and 50 million people are affected by drought every
year. Some 97.85 million hectares — nearly 30% of India’s land — underwent land degradation during 2018-19.
Drought impacts India’s dominantly rainfed agriculture that accounts for 60% of sown area on average.
 Initiatives:
→ UNCCD [1994].
→ India:
 soil health card; scientific irrigation methods (Pradhan Mantri Krishi Sinchai Yojana, Desert development
program, etc.)
 Status:
→ According to Desertification and Land Degradation Atlas released by GOI (published by ISRO) in 2021, at least 30% of
India’s total geographical area is under category of “degraded land”.
→ Jharkhand, Rajasthan, Delhi, Gujarat, and Goa have more than 50% of land area undergoing desertification or
degradation. States with less than 10% land degradation are Kerala, Assam, Mizoram, Haryana, Bihar, Uttar Pradesh,
Punjab, and Arunachal Pradesh.
 Way Forward:
→ Farmers must be incentivised to choose cropping patterns that require less water. Farmers must go for
drip irrigation or other water management mechanisms to save our only available deeper aquifers. Local
consumption and weather patterns should be kept in mind while formulating policies. Example - avoid
growing sugarcane in areas where water is deficient, encoure organic farming. Engagement with key
stakeholders – farmers, pastoralists, foresters, smallholders – involved in managing soils and conserving
water in agriculture. Use of technology to reverse degradation in resources. Reforms in water- and land-
governance policies. Further intensify Drought Prone Areas Programme (DPAP), crop diversification,
cultivation of traditional varieties, mulching, intercropping, micro -irrigation, etc.
 Manipur:
→ Manipur faced drought in last decade.
Note:
 United Nations Convention to Combat Desertification (UNCCD) [1994]:
→ What:
 Convention to combat desertification, mitigate effects of drought through national action programs, supported
by international cooperation, partnership arrangements. It is one legally binding convention linking
development and environment to sustainable land management. UNCCD is one of 3 Rio Conventions, other two
being: UNCBD [1993]; and UNFCCC.
→ Aim:
 UNCCD aims to promote effective action through innovative national programmes and supportive international
partnerships.
→ Focus:
 Arid, semi-arid, dry sub-humid areas (drylands) [vulnerable ecosystems, vulnerable peoples found].
→ Feature:
 UNCCD is sole legally binding international agreement linking environment and sustainable land management.
It is only convention stemming from direct recommendation of Agenda 21, Earth Summit, Rio, 1992. UNCCD is
committed to bottom-up approach, encouraging participation of local people in combating desertification.
 UNCCD addresses particularly arid, semi-arid & dry sub-humid areas, called drylands, where some of most
vulnerable ecosystems and peoples are found.
→ Fact:
 Year 2006 - “International Year of Deserts and Desertification”, to help publicise UNCCD.
→ Land for Life Award:
 Launched at UNCCD COP (Conference of Parties) in 2011. world’s highest reward regarding land conservation
and restoration. organised by UNCCD every 2 years.
Page 232 of 719
 → Conference of Parties (COP) [UNCCD]:
 It oversees implementation of UNCCD. It is established by UNCC as supreme decision-making body, and it
comprises all ratifying governments. Its sessions are held on biennial basis.
 COP15 [UNCCD] [2022]:
• Theme: ‘Land. Life. Legacy: From scarcity to prosperity’, is call to action to ensure land, lifeline on this planet,
continues to benefit present and future generations; Mandate: COP15 to drive progress in future
sustainable management of land and will explore links between land and other key sustainability issues;
Agenda: Drought, land restoration, and related enablers such as land rights, gender equality and youth
empowerment; held in Abidjan, Ivory Coast in West Africa; India took part in it.
 Drought in Numbers, 2022 report:
→ What:
 released at 15th Conference of Parties (CoP15) to UNCCD held in 2022 in Abidjan, Ivory Coast. This report is one
authoritative publication of drought-related information and data. It contains assessment analysed on droughts
and impacts on life and livelihood over 122 years covering 196 countries.
→ Highlight:
 Frequency and duration of drought is increasing at alarming rate across world since onset of 21st century. Entire
new generation is growing up being “water scarce”. Since 2000, there has been 29% increase in frequency and
duration of droughts in world. Drought is considered slow onset disaster, thus giving enough time to prepare for
it. But in recent decades, drought has emerged as one of biggest drivers of human life loss and economic loss
among weather-related disasters.
→ India:
 India is one of severely drought-impacted countries. Nearly 2/3rd of India suffered drought during 2020-22.
Geographically, India’s drought vulnerability compares with that of sub-Saharan Africa. Effect of severe droughts
was estimated to have reduced India’s GDP by 2-5% over 20 years from 1998-2017.
 State of world’s land and water resources for food and agriculture [by FAO]:
→ It says water and land resources are being pushed to limits due to human actions. Sources of fodder (grassland,
shrub-covered areas) have declined significantly due to conversion to cropland. Due to population increase,
agricultural land available for crops, animal husbandry declined. Almost 1/3rd of rain-fed cropland, nearly 1/2 of
irrigated land are degraded due to human actions. [It affected fertility of soil]. About 50% of irrigated areas are
degraded in northern Africa, south Asia, middle east-western Asia. Rapid growth of cities had significant impact on
land and water resources. This meant encroachment on good agricultural land. Agriculture is primary reason for
pressure on world’s land, soil, water resources. [due to use of chemical fertilizers, farm mechanization etc].
 Familial Forestry:
→ What:
 Familial forestry starts with domestication of trees. It directly involves family in plantation and its
care. When household grows and nurture its own forest in and around house, children of that house
get sensitized about surrounding during their primary stage of socialization. It shapes them as
environmental connected individual. Fruit plants at home not only provide nutrition but also provide
income. Family gets fresh and organic vegetables, without extra land, water, labour because these
vegetables are grown with trees. Family trees provide nesting place to birds, insects thus increase
biodiversity. Familial Forestry associates rituals and festivals with trees, so as to make green footprint
an integral part of social structure.
 Aridity Anomaly Index (AAI):
→ released by IMD monthly.
Value Addition:
 UN Decade of Family Farming - 2019-28.
 Conference of Parties (COP):
→ supreme governing body of international convention (treaty, written agreement between actors in
international law). It is composed of representatives of member states of convention and accredited
observers. Scope of COP is to review implementation of Convention and any other legal instruments that
COP adopts and take decisions necessary to promote effective implementation of Convention.
→ Conventions with COP include:
 Basel Convention [Hazardous waste]; Chemical Weapons Convention (CWC); Convention on Biological
Diversity (CBD); Convention on International Trade in Endangered Species of Wild Fauna and Flora
(CITES); Kyoto Protocol; Minamata Convention on Mercury; Ramsar Convention; Rotterdam
Convention [Hazardous chemical]; Stockholm Convention on Persistent Organic Pollutants ; Treaty on
Non-Proliferation of Nuclear Weapons; UNCCD; United Nations Convention against Corruption ; United
Nations Framework Convention on Climate Change (UNFCCC); United Nations Climate Change
conference
 Family Farm:
→ farm owned and / or operated by family. Sometimes, considered to be estate passed down by inheritance.
Mains Link:
Page 233 of 719
  Differentiate between land degradation and desertification? Discuss impact of desertification on ecology.
 How can India manage food security for the future without degradation of land and water resources in the country?
Discuss. (15M)
 Discuss the impacts of frequent droughts on Indian Economy.

GOLD
News:
 2021:
→ As per WGC, Gold demand in India decreased because of Covid-19 lockdown and high gold prices.
→ WGC releases Bullion Trade in India report.
→ RBI announces Sovereign Gold Bond (SGB) Scheme 2021-22.
 2022:
→ As per WGC, India has emerged as 4 th largest gold recycler in world and India has recycled 75 tonnes of
Gold in 2021. [Top – China.]
→ G7 decide to ban Russian gold imports for invasion of Ukraine.
 Impact: It will put economic pressure on Russia. Already Russia has defaulted on its foreign debt for 1 st time
since 1917 Bolshevik Revolution, and Gold is Russia’s 2nd-largest export industry after oil and gas.
 Impact on India: Since India is not part of G7, this move will not directly impact India. However, India may face
problems in issuing payments for gold purchases. India is largest importer and consumer of Gold and limited
supply may increase Gold price.
 Why ban Gold?: USA says Russia has used gold to support its currency as way to circumvent impact of sanctions.
One way to do that is by swapping gold for more liquid foreign exchange that is not subject to current sanctions.
 Will Gold ban work?: Some experts say since only few countries are implementing gold ban, this move is largely
symbolic. Other experts say while Russia will still be able to sell gold to other countries outside G7 jurisdictions,
it will impact ability of Russia to earn export revenue (nearly 90% of Russia’s gold revenue comes from G7). It
will be even more effective if secondary sanctions are put on countries outside G7, who buy Russia’s Gold.
→ PM Modi launches India’s 1st International Bullion Exchange - International Bullion Exchange (IIBX) – at IFSC in GIFT
city.
→ Sovereign Gold Bonds 2022-23 (Series II) in news.
About:
 Gold Refining:
→ Gold extracted by amalgamation or cyanidation contains variety of impurities, including zinc, copper, silver, iron.
Therefore, methods are employed for Gold purification and some common Gold refining methods are: Miller process,
Wohlwill process.
→ Gold refining in India:
 As per WGC, India’s gold refining capacity increased by 1,500 tonnes (500%) in 2021. Number of formal recycling
businesses increased from to 33 in 2021. Scale of unorganised refining fell, largely due to GOI’s tightening of
pollution regulations. India has potential to emerge as competitive Gold refining hub if next phase of bullion
market reforms promote responsible sourcing, exports of bars and consistent supply of dore bar or Gold scrap.
Despite being 4th largest gold recycler in world, India recycles little of its own stock of gold — about 8% of global
scrap supply.
 Gold reserves (descending order):
→ US, Germany, IMF, Italy, … [India at 9th as of 2022]. [India is world’s 2nd biggest consumer of Gold after China].
 Gold and Economy:
→ Relation:
 Gold as Currency: Gold was used as world’s reserve currency. USA used gold standard till 1971.
 Gold as hedge against inflation: Gold demand increases during inflationary times because of its inherent value
and limited supply. As gold cannot be diluted, gold retains value better than other currencies.
 Strength of Currency: When gold price increases, currency of country that exports gold / has gold reserves also
increases.
→ Gold Demand in India:
 Factors:
• Short Term:
 Inflation: Inflation increases -> gold demand increases; Gold price: Gold price increases -> gold demand
decreases; Rainfall: Monsoon rainfall increases -> gold demand increases.
• Long Term:
 Income: Income increases -> gold demand increases; Gold price: Gold price increases -> gold demand
decreases; Population: Rise in Middle class, young Indian -> gold demand increases. Indian culture
supports gold.
 Initiative:
• Sovereign Gold Bond (SGB) Scheme [2015].

Page 234 of 719

  World Gold Council (WGC):
→ What:
 market development organisation for gold industry. Headquarter – UK.
→ Aim:
 stimulate and sustain demand for gold
→ Focus:
 gold mining, gold investment, gold demand.
→ Member:
 leading gold mining companies in world
→ Function:
 support its members to mine in responsible way. support its members to develop Conflict Free Gold Standard.
→ India:
 WGC has one office in India.
Note:
 Bullion:
→ What:
 Bullion is non-ferrous metal that has been refined to high standard of elemental purity. Term is ordinarily applied
to bulk metal used in production of coins and especially to precious metals such as gold, silver. Although precious
metal bullion is no longer used to make coins for general circulation, it continues to be held as investment with
reputation for stability in periods of economic uncertainty. To assess purity of gold bullion, centuries-old
technique of fire assay is still employed, together with modern spectroscopic instrumentation, to accurately
determine its quality.
→ Feature:
 Bullion can sometimes be considered legal tender and is often held as reserves by central banks or held by
institutional investors. Recently, Zimbabwe’s central bank introduced gold coins (‘Mosi-oa-Tunya’) that it hopes
will ease citizens’ demands for foreign currency.
→ Bullion Exchange:
 It is market through which buyers and sellers trade gold and silver as well as associated derivatives. E.g. London
Bullion Market is known as primary global market trading platform for gold and silver.
→ Indian International Bullion Exchange (IIBX) [2022]:
 What:
• It is at IFSC, GIFT city, Gujarat. It is India’s 1st International Bullion Exchange. PM Modi launched IIBX in 2022
at IFSC in GIFT city.
 Background:
• IIBX was 1st introduced in budget 2020 for easing gold import by Jewellers in India.
 Significance:
• Help in standard gold pricing in India. It will help dealers and jewellers to trade in precious metals.
 Sovereign Gold Bond (SGB) Scheme [2015]:
→ What:
 SGB was introduced by Government of India in 2015. SGBs are unique instruments, prices of which are
linked to commodity price viz Gold. SGBs are also budgeted in lieu of market borrowing. Calendar of
issuance is published indicating tranche description, date of subscription and date of issuance. SGB
Bonds shall be denominated in units of 1 gram of gold and multiples thereof. Minimum investment in
SGB shall be 1 gram with maximum limit of subscription per fiscal year of 4 kg for individuals, 4 kg for
Hindu Undivided Family (HUF), and 20 kg for trusts and si milar entities notified by Government from
time to time.
→ Aim:
 Reducing India’s over dependence on gold imports. changing habits of Indians from saving in physical
form of gold to paper form, with sovereign backing.
→ Feature:
 Issuance: Gold Bonds are issued as GOI Stock under Government Securities Act, 2006. These are issued
by RBI on behalf of GOI.
 Eligibility: Resident Indian entities (individuals, Hindu Undivided Family [HUF], trusts, universities,
charitable institutions etc). Denomination: Multiples of g ram(s) of gold, with basic unit of 1 gram.
Tenure: 8 years, with exit option from 5th year. Minimum, Maximum limits: Minimum permissible
investment limit = 1 gram of gold; maximum limit: 4 kg for individual, 4 kg for HUF, 20 kg for trusts
and similar entities. Joint Holder: In case of joint holding, investment limit of 4 kg will be applied to
1st applicant only. Collateral: SGB can be used as collateral for loans.
 Stock exchange: Gold Bonds are sold through Commercial banks, Stock Holding Corporation of Ind ia
Limited (SHCIL), designated post offices and recognised stock exchanges viz NSE and BSE, either
directly or through agents.

Page 235 of 719

  Term: Gold bonds come with maturity period of 8 years, with option to exit investment after 1 st 5
years.
 Collateral: Gold Bonds can be used as collateral for loans. Loan -to-value (LTV) ratio is to be set equal
to ordinary gold loans mandated by RBI from time to time.
 Bullion Trade in India 2021 report (WGC):
→ In last 5 years, India’s gold supply consists of about 85% imports. In last 5 years, India’s gold imports
continue to grow despite high import duty. In last 10 years, India imported about 6,500 tonnes of gold,
averaging about 700 tonnes per year. India imported gold bars, gold dores from many countries, of which
about ½ came from just 2 countries — Switzerland, UAE. In last 5 years, gold dore imports made up about
1/3 rd of total gold imports.
Mains Link:
 Discuss the key features and significance of Sovereign Gold Bond Scheme.
 Discuss how gold demand affects the overall economy of a country.

JUTE
News:
 2022:
→ GOI launches ‘Jute Mark India’ logo to promote jute products.
About:
 Status:
→ According to UNFAO data, production and area under jute cultivation has declined in India in past decade.
India is still largest producer of jute. But in terms of acreage, Bangladesh is largest cultivator. Bangladesh
accounts for nearly 75% of global jute exports, while India’s share is just 7%. Reasons: Lack of market,
government procurement and diversification, poor infrastructure , sorry state of Indian jute mills.
 Issue:
→ India’s share in global jute exports is just 7%; Lack of market, government procurem ent and diversification;
Poor infrastructure; sorry state of Indian jute mills.
 Initiative:
→ Jute Mark India (JMI) scheme; ‘Jute Mark India’ logo [2022].
Note:
 Jute Mark India scheme / JMI scheme:
→ JMI will provide collective identity and assurance of origin and quality for traditional jute and jute
products. JMI would therefore be one hallmark of powerful creative work that defines jute product with
quality, distinguishes it from competition and connects it with customers.
→ ‘Jute Mark India’ logo [2022] certification is expected to boost domestic market and exports of jute
products from India.

AUGUST, 2022
DRUG ABUSE AND ILLICIT TRAFFICKING
News:
 2020:
→ Government empowers NIA to investigate offences under Narcotic Drugs and Psychotropic Substances (NDPS) Act,
1985 so that NIA agency need not rely on local police to unravel drug trade ties that emerge during counter-terrorism
operations.
 2021:
→ Punjab government approves reward policy to encourage information leading to recovery of drugs under NDPS Act.
→ Tripura High Court finds one unintentional error in narcotic 1985 law and directs Union Home Ministry to amend
related provision.
→ Anti-drug law enforcement agencies suspect steep increase in cross-border trafficking of heroin with Taliban
takeover in Afghanistan.
→ Ministry of Social Justice and Empowerment recommends that National Fund for Control of Drug Abuse be used to
carry out de-addiction programmes, rather than just policing activities.
→ Drugs were major sources of revenue for Taliban. With collapse of Afghanistan’s economy, Taliban will rely heavily
on drug money to maintain control over their cadres.
→ Narcotic Drugs and Psychotropic Substances (Amendment) Bill, 2021 passed in Parliament. [It now becomes Narcotic
Drugs and Psychotropic Substances (Amendment) Act, 2021].
→ Canada to allow adults in British Columbia (its one province) to possess up to 2.5 grams of opioids, cocaine,
methamphetamine, MDMA. This move signals that Canada will treat drug addiction as mental health issue rather
than judicial one.
 Significance: Canada’s move is latest among series of policy tweaks that are being either contemplated or
executed by different countries to re-adjust their response in ongoing global ‘war on drugs’.
 2022:
Page 236 of 719
 → UNODC releases World Drug Report, 2022.
→ In order to bring attention to menace of Narcotic Drugs and Psychotropic Substances (NDPS), 1 month long pan India
drive against smuggling of narcotics through rail, is launched under code name Operation “NARCOS”.
→ While granting bail to one man arrested for possessing bhang, Karnataka High Court observes that nowhere in NDPS
Act is bhang referred to as prohibited drink or prohibited drug. It relied on earlier Judgments - Madhukar vs State of
Maharashtra (2002, Supreme Court) and Arjun Singh vs State of Haryana (2004, Punjab-Haryana High Court) - where
Supreme Court and also Punjab-Haryana High Court had ruled that bhang is not ganja, and is therefore not covered
under NDPS Act. [NDPS Act defines cannabis (hemp) as narcotic drug – Charas, Ganja and any other mixture. Only
Bhang which is made with leaves of cannabis plant is not mentioned in NDPS Act].
→ Operation Garuda: CBI launches one multi-phase ‘Operation Garuda’ against illicit drug trafficking network,
registering 127 new cases, arresting 175 people and seizing huge quantities of narcotic drugs.
About:
 Drug Abuse:
→ What:
 habitual taking of illegal drugs. Drug use is highest in countries with low level of income. Drug abuse control is
responsibility of central government.
→ Reasons:
 To be accepted by peers; Increasing economic stress; Changing cultural values; Experimentation; Neurotic
pleasure; Ineffective policing.
→ Cases in India:
 NCRB report - Crime in India 2020 says about 60,000 cases were lodged under NDPS Act, 1985. In 2019, there
were about 3 crore cannabis users, about 2.5 crore opioid users. Kerala – highest drug addiction or drug abuse
related suicides.
→ Portuguese model on control of drug abuse:
 In 2001, Portugal was faced with crisis of heroin overdose deaths. Thus, Portugal became 1 st country in world to
decriminalize possession and use of all illegal drugs. Instead of sending drug user / people to court for drug
possession, Portugal’s model focused on education, treatment, harm reduction.
 Illicit drug trafficking / Illicit trafficking of drug:
→ It means production, possession, sale, purchase, transportation, warehousing, use of drug.
 Need to control drug abuse and illicit trafficking:
→ 2019 AIIMS-Delhi study says:
 many people use psychoactive substances (alcohol, cannabis, opioids). adult men top list of drugs users. Alcohol
is most commonly abused psychoactive substance, followed by cannabis, opioids (heroin, opium), inhalers.
Addiction generally begins with alcohol, then towards nicotine, cannabis, and then to hard substances.
→ NCRB says:
 In year 2019, maximum suicide victims due to drug abuse / alcohol addiction were of males. Drugs & alcohol are
one of most causative factors for road accident deaths.
 India initiatives:
→ National Policy on Narcotic Drugs and Psychotropic Substances; Narcotic Drugs and Psychotropic Substances Act,
1985; Narcotics Control Bureau (NCB) [1986]; ‘Drugs-Free India Campaign’ (Nasha Mukt Bharat Abhiyaan) [2020];
National Action Plan for Drug Demand Reduction (NAPDDR) for 2018-25; Narco Coordination Centre (NCORD) [2016];
National Fund for Control of Drug Abuse; Seizer, arrests; 3-pronged formula to solve drug menace: Strengthening of
institutional structure, empowering and coordination of all narcotics agencies at Centre and State, and awareness
campaigns; NCORD and NIDAAN portals have been initiated; Seizure Information Management System (SIMS) which
will create complete online database of drug offences and offenders (by NCB); National Fund for Control of Drugs
Abuse; National Survey on Drug Use and Health (NSDUH) to measure trends of drug abuse in India (Ministry of Social
Justice & Empowerment); ‘Project Sunrise’ (2016) to tackle rising HIV prevalence in NE States; NDPS, 1985: Prohibits
person from producing, possessing, selling, purchasing, transporting, storing, and / or consuming any narcotic drug
or psychotropic substance.
→ CBI launched this multi-phase ‘Operation Garuda’ against illicit drug trafficking network.
 Global initiatives:
→ International Day against Drug Abuse and Illicit Trafficking; Trafficking in illicit drugs is one focus area of UNODC;
International Narcotics Control Board (INCB) [1968].
 Fact:
→ According to NCRB, there was decrease of more than 27% in crimes related to personal consumption of drugs from
2019 to 2020.
Note:
 International Narcotics Control Board (INCB) [1968]:
→ What:
 independent and quasi-judicial monitoring body for implementation of UN international drug control
conventions.
→ Project Prism [2003]:
Page 237 of 719
  framework for international cooperation in matters related to trafficking in chemicals used in illicit manufacture
of drugs, specifically amphetamine-type stimulants; and other synthetic drugs.
→ Project Cohesion [2006]:
 framework for international cooperation in matters related to trafficking in chemicals used in illicit manufacture
of drugs, specifically cocaine; and heroin.
 War on drugs:
→ What:
 One global campaign, led by U.S. federal government, of drug prohibition, military aid, and military intervention,
with aim of reducing illegal drug trade in United States. This initiative includes drug policies that are intended to
discourage production, distribution, and consumption of psychoactive drugs that participating governments and
UN have made illegal. This term was popularized by media shortly after one press conference given in 1971, by
US President Richard Nixon during which he declared drug abuse as "public enemy number one". In 1961, UN
passed Single Convention on Narcotic Drugs which sought to prohibit production and supply of various
substances through international cooperation. In 1971, then US President Richard Nixon held one press
conference and declared drug abuse as public enemy number one. He said that new, all out offensive was
required, that would be “worldwide” in nature. This marked beginning of global campaign to eradicate use of
illicit drugs and its production, called ‘War on Drugs’. At heart of this campaign lay notion that prohibition of
drugs would reduce consumption. By criminalising drugs and initiating harsh punitive action against people
involved in use, production and dissemination, world would effectively be rid of drugs.
→ Status:
 In 2011, Global Commission on Drug Policy released one report on War on Drugs, declaring that global war on
drugs has failed, with devastating consequences for individuals and societies around world. This report claimed
that in period that such war on drug campaign has been in play, global market of illegal drugs has not been
curtailed, but in reality has grown. This report said that fundamental reforms in national and global drug control
policies were urgently needed.
 Single Convention on Narcotic Drugs, 1961 / Single Convention / 1961 Convention / C61:
→ What:
 One international treaty (UN treaty) that controls activities (production, supply, trade, use) of specific narcotic
drugs and establishes system of regulations (licenses, measures for treatment, research, etc.) for their medical
and scientific uses.
 National Policy on Narcotic Drugs and Psychotropic Substances:
→ Narcotic Drugs and Psychotropic Substances have several medical and scientific uses. However, they can be abused
and trafficked. India's approach towards Narcotic Drugs and Psychotropic Substances is enshrined in Article 47 which
mandates that state shall endeavour to bring about prohibition of consumption except for medicinal purposes of
intoxicating drinks and of drugs which are injurious to health.
→ This same principle of preventing use of drugs except for medicinal use was also adopted in 3 international
conventions on drugs: Single Convention on Narcotic Drugs, 1961; Convention on Psychotropic Substances, 1971; UN
Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, 1988. [Vienna Convention 1988]
India signed and ratified said 3 conventions.
 Narcotic Drugs and Psychotropic Substances (NDPS) Act, 1985:
→ What:
 Act to consolidate and amend law relating to narcotic drugs, to make stringent provisions for control and
regulation of operations relating to narcotic drugs and psychotropic substances, to provide for forfeiture of
property derived from, or used in, illicit traffic in narcotic drugs and psychotropic substances, to implement
provisions of International Conventions on Narcotic Drugs and Psychotropic Substances. statutory framework
for drug law enforcement in India. It prohibits person from producing, possessing, selling, purchasing,
transporting, storing, consuming any narcotic drug or psychotropic substance. It extends to whole of India. It
applies to all Indian citizens outside India, to all persons on ships, aircrafts registered in India.
 In short, it deals with drugs and their trafficking.
→ Background:
 It was designed to fulfill India’s treaty obligations under: Single Convention on Narcotic Drugs, 1961
(international treaty); Convention on Psychotropic Substances, 1971 (UN treaty); UN Convention Against Illicit
Traffic in Narcotic Drugs and Psychotropic Substances, 1988.
→ Provisions:
 Cultivation, production, manufacture, possession, sale, purchase, transportation, consumption, inter-State
movement, import &export of narcotic drugs and psychotropic substances is prohibited, except: for medical or
scientific purposes; and in accordance with terms and conditions of any license, permit or authorization given
by government; Central Government is empowered to regulate about narcotic drugs and psychotropic
substances; State Governments are also empowered to certain extent; Addicts volunteering for treatment will
get immunity; Quantity at play: This act defines 3 categories - small quantity; commercial; and more than small
but less than commercial; Narcotics Control Bureau (NCB) [1986]. This act extends to whole of India and also to
aircraft and ships that are registered in India.
Page 238 of 719
 → Exemption:
 This Act states that government may allow cultivation of any cannabis plant for industrial purposes only of
obtaining fibre or seed or for horticultural purposes.
 Narcotics Control Bureau (NCB) [1986]:
→ Narcotics related apex coordinating agency. Indian federal law enforcement and intelligence agency. constituted by
Government of India under Narcotic Drugs and Psychotropic Substances Act 1985. under Ministry of Home Affairs.
→ combating drug trafficking and use of illegal substances
 Narcotic Drugs and Psychotropic Substances (Amendment) Act, 2021:
→ What:
 Act further to amend Narcotic Drugs and Psychotropic Substances Act, 1985.
→ Objective:
 to rectify one error in one penal related provision of 1985 Act.
→ Criticisms:
 Few experts observed that 2021 amendment Act violates fundamental rights of citizen because this 2021
amendment Act provides retrospective effect to offences. 2021 amendment Act also violates fundamental rights
in Article 21 because one can be punished for offence for which there is law in existence at time of commission
of offence.
 National Fund for Control of Drug Abuse:
→ What:
 To fund below given drug related issues. It was created under Narcotic Drugs and Psychotropic Substances
(NDPS) Act, 1985.
→ Funding:
 Under NDPS Act, 1985, sale proceeds of any property forfeited, grants made by any person and institution, and
income from investments of this fund.
→ Usage:
 combating illicit traffic in Narcotic Drugs; Controlling abuse of narcotic drugs; rehabilitation of addicts;
preventing drug abuse; education of public against drug abuse; supplying drugs to addicts on medicinal
necessity; governing body to sanction money from this fund.
 International Day against Drug Abuse and Illicit Trafficking:
→ by UN. 26 June. every year.
 World Drug Report:
→ by UNODC.
→ 2022 World Drug Report:
 On India: India is world’s single-largest opiate market. Opiates coming from Afghanistan have increased thereby
increasing trafficking and associated organised crimes. On world: Rate of drug consumption has increased.
Increase is more rapid in women than men. Drug production and trafficking have increased. Middle East and SE
Asia are emerging grounds for synthetic drugs manufacturing. Environmental Impact: Deforestation (due to
Cocoa cultivation), Waste generation (in synthetic drug manufacturing).
 United Nations Office on Drugs and Crime [1997]:
→ What:
 One UN office that was established in 1997 to fight against illicit drugs and international crime. It is hq in Vienna.
→ Focus:
 Trafficking in and abuse of illicit drugs; crime prevention and criminal justice; international terrorism; and
political corruption. It is one member of UN Sustainable Development Group.
 Operation “NARCOS”:
→ It is 1-month long pan India drive against smuggling of narcotics through rail. It was launched in order to bring
attention to menace of Narcotic Drugs and Psychotropic Substances (NDPS).
RPF has been empowered to conduct search, seizure and arrest under NDPS Act since April 2019 and has been
actively participating in efforts of Government to restrict this illegal trade.
 Bhang:
→ Edible preparation made from leaves of cannabis plant originating from Indian subcontinent. It has been used in food
and drink as early as 1000 BC in ancient India. Bhang is traditionally distributed during spring festival of Maha
Shivaratri and Holi. Bhang is mainly used in bhang shops, which sell cannabis-infused Indian drinks bhang lassi and
bhang thandai. It is often incorporated into drinks such as thandai and lassi, along with various foods.
 Operation Garuda:
→ CBI launched this multi-phase ‘Operation Garuda’ against illicit drug trafficking network. It is one global operation
initiated in close coordination with Interpol and Narcotics Control Bureau, for combating smuggling of illicit drugs
and psychotropic substances, with special focus on Indian Ocean region. This operation seeks to disrupt, degrade
and dismantle drug networks with international linkages through rapid exchange of criminal intelligence on drug
trafficking and coordinated law enforcement actions across international jurisdiction through Interpol.
Value Addition:

Page 239 of 719

  Golden Triangle:
→ coined by CIA. area where borders of Myanmar, Thailand, Laos meet at confluence of Ruak R. and Mekong
R. i.e. area that overlaps mountains of said 3 adjacent countries. one of Asia's 2 principal areas of illicit
opium production. one of largest opium-producing areas in world. world's 2nd most heroin comes from
Golden Triangle. As per UNODC, drug trafficking has long been problem in Golden Triangle.
 Golden Crescent:
→ one of Asia's 2 principal areas of illicit opium production . area at crossroads of Western Asia, Central Asia,
South Asia. Area that overlaps 3 nations: Iran; Afghanistan - world's largest heroin producer; Pakistan.
Mains Link:
 India is vulnerable to narcotic drug trafficking. Critically examine its causes. Also comment on the role of Government in
combating drug problem.
 India’s proximity to two of the world’s biggest illicit opium-growing states has enhanced her internal security concerns.
Explain the linkages between drug trafficking and other illicit activities such as gunrunning, money laundering and human
trafficking. What counter-measures should be taken to prevent the same? (UPSC 2018)

MONAZITE
About:
 What:
→ It is one primarily reddish-brown phosphate mineral that contains REE. Due to variability in composition,
monazite is considered group of minerals. Most common species of group is monazite-(Ce), that is, cerium-
dominant member of group. It occurs usually in small isolated crystals. There are 5 different most common
species of monazite, depending on relative amounts of REE in mineral: monazite-(Ce) (most common
member), monazite-(La), monazite-(Nd), monazite-(Sm), monazite-(Pr).
It is one of beach sand minerals that contain REE like lanthanum, cerium, praseodymium, neodymium
etc. It also contains thorium which is one “prescribed substance” under Atomic Energy Act, 1962. It is rare
phosphate mineral that usually occurs in small isolated grains in Igneous and M etamorphic rocks such as
granite, pegmatite, schist, gneiss. It is translucent and one of most resistant minerals to weathering. It is
one radioactive atomic mineral used for production of Thorium (as high as 500 ppm) and has potential to
be used as fuel in nuclear power system.
 India:
→ Monazite distribution:
 Western Ghat, Himalayas, Eastern ghats, eastern India.
Question:
 Kerala, Andhra Pradesh, Odisha, Jharkhand have Monazite deposits.

AVIATION
News:
 2021:
→ Indrajaal developed.
→ ICMR drone is used to deliver vaccine in Manipur.
→ Under Drone Rules 2021, Ministry of Civil Aviation notified traffic management framework for drones.
→ Lok Sabha passes Airports Economic Regulatory Authority of India (Amendment) Bill, 2021 .
→ Under UDAN, government announced new flights to connect small cities with metros.
→ Ministry of Civil Aviation announces to:
 add new routes
 rationalise value added tax (VAT) charged on aviation turbine fuel (ATF).
→ Central Board of Indirect Taxes and Customs (CBIC) declares Kushinagar Airport, UP as Customs notified airport. [This
would also facilitate international passenger movements including Buddhist pilgrims].
→ Government of India identifies 21stOctober as UDAN Day.
 2022:
→ Ministry of Civil Aviation (MoCA) sends note on “use of drones” across various sectors to different central ministries:
 Ministry of Home Affairs:
• For surveillance, situational analysis, crime control, VVIP security, disaster management, etc.
 Ministry of Defence:
• Drones for combat, communication in remote areas, counter-drone solutions, etc.
 Ministry of Health and Family Welfare:
• Delivery of medicines, collection of samples from remote or epidemic / pandemic-affected areas.
 Petroleum and Natural Gas, and Power Ministries:
• For real-time surveillance of assets and transmission lines, theft prevention, visual inspection /
maintenance, construction planning, management, etc.
 Environment, Forests and Climate Change Ministry:

Page 240 of 719

 • Anti-poaching actions, monitoring of forests and wildlife, pollution assessment, evidence gathering.
 Ministry of Information and Broadcasting:
• For high-quality videography of events and difficult-to-reach-places. [low altitude shooting without noise,
prevent dust pollution, risk of accidents].
 Other areas:
• To undertake disaster management, incidence response, inspection / maintenance works, project
monitoring.
→ Some Remote Pilot Training Organisations (RPTO) are set up by entities under Government or private ownership.
 Background: As per Drone Rules, 2021, any person who intends to obtain authorisation to establish Remote
Pilot Training Organisation (RPTO) shall submit application to Director General of Civil Aviation in Form D5 on
Digital Sky Platform, along with fees.
→ Government bans import of drones, except for research and development, defence and security purposes. [This
move aims to promote made in India drones. In this regard, Directorate General of Foreign Trade, Ministry of
Commerce and Industry has notified Indian Trade Classification (Harmonised System), 2022].
→ UDAN scheme is selected for Prime Minister’s Awards for Excellence in Public Administration 2020.
→ Union Civil Aviation Minister says that Government of India is exploring possibility of inviting manufacturers of
Electric Vertical Take-off and Landing (eVTOL) aircraft to set up base in India.
→ DRDO successfully carried out maiden test flight of one new UAV, autonomous Flying Wing Technology
Demonstrator.
→ In response to SpiceJet’s increasing number of air safety problems, DGCA issues show-cause notice.
→ MoCA reply in Rajya Sabha that India signed Bilateral Air Service Agreement with 116 countries.
→ MoCA reply in Rajya Sabha that private players can use drones for delivery purposes in accordance with Drone Rules,
2021. [Government is utilizing services of drone providers for vaccine delivery, inspection of oil pipelines, power
transmission lines, agricultural spraying, etc. Private players can now also do so.]
→ Ministry of Civil Aviation’s flagship program Regional Connectivity Scheme UDAN has completed 5 years of success
(launched in 2016) since launch of its 1st flight by PM in 2017.
→ CoE – SURVEI standardizes drone images for land Survey: Setting world’s 1 st standard on land survey using drone,
Ministry of Defense’s Centre of Excellence – Satellite and Unmanned Remote Vehicle Initiative (CoE – SURVEI)
publishes one draft concept paper prescribing technical parameters which may serve as reference standard to
estimate image quality of drone survey output. This draft standards prescribe 19 parameters to evaluate quality of
drone output and 8 extension metrics / techniques to estimate image quality, apart from indicating sample
benchmarking from literature.
→ DGCA raises concern over 5G rollout: As India’s telecom operators prepare for rollout of 5G services, country’s
aviation safety regulator DGCA writes to telecom department flagging concerns over likely interference of 5G C-Band
spectrum with aircraft radio altimeters. Primary concern of DGCA emerges from fact that these altimeters as well as
part of 5G telecom services operate in C-Band. For telecom service providers, C-Band presents sweet spot for rolling
out 5G services, ensuring coverage as well as high bandwidth, resulting in faster internet speeds. For aircraft
operations, use of altimeters in C-band ensures highly precise measurements of plane’s altitude. [However, experts
say, India has auctioned C-Band spectrum in frequency ranging from 3.3 GHz to 3.6 GHz. Aircraft radio altimeters
mainly use frequencies ranging from 4.2-4.4 GHz. So, there is significant 500 MHz gap between two frequency
ranges].
→ Defence Minister Rajnath Singh unveils 2nd edition of ‘Mehar Baba’ swarm drone competition by Indian Air Force for
Indian start-ups to develop swarm drone based system to detect foreign objects on aircraft operating surfaces.
→ Airlines under Tata umbrella (Air India, AirAsia India, Vistara airline) have signed MoU with CSIR–Indian Institute of
Petroleum (CSIR–IIP) to collaborate and work together on research, development, and deployment of sustainable
aviation fuels (blended fuel for lower carbon emissions). [Focus of MoU is exploration of Single Reactor HEFA
Technology for Drop-in liquid Sustainable Aviation and Automotive Fuel (DILSAAF)].
→ GOI launches AVGAS 100 LL (one special aviation fuel meant for piston engine aircrafts and UAVs).
→ Department of Financial Services (DFS), Min. of Finance modifies ECLGS for aviation sector, raising this scheme’s
cheaper loan limit to Rs. 1,500 crore from Rs. 400 crore to help aviation sector tide over cash-flow problems. [Recent
issues with aviation sector - High fuel cost, need for funds to sustain heavy costs, need for funds to pay pending
dues].
About:
 What:
→ Aviation is activities surrounding mechanical flight and aircraft industry.
 Customs Airport:
→ What:
 Airport notified by appropriate customs authority of India as airport which shall be airport for unloading of
imported goods and loading of export goods or any class of such goods.
 Airports Economic Regulatory Authority of India Act, 2008:
→ Provisions:

Page 241 of 719

  Airport Economic Regulatory Authority (AERA):
• This 2008 Act established AERA.
• AERA regulates tariffs and other charges (airport development fees etc.) for aeronautical services given at
major airports in India.
 2008 Act designates airport as major airport if it has annual passenger traffic of at least 35 lakh.
 Drone:
→ Drone Categories [India]:

{Type} {Weight} {Registration Reqd?}
Nano <= 250 grams No
Micro 250 grams to 2kg Yes
Small 2kg to 25kg Yes
Medium 25kg to 150kg Yes
Large 150kg Yes
→ Swarm drones:
 Swarm drones consist of number of drones controlled from same station and coordinate with each other to
complete mission.
 India:
• They are capable of surveillance and of performing attack missions. For designing swarm drones for Indian
Army, HAL is supporting NewSpace research and Techologies (one Bengaluru based Indian startup) in
development of swarm drones.
• In 2021, DRDO showcased armed swarm technology with minimal human efforts. Said drones were
operable at high-altitudes, rough-weather conditions and has ability to strike multiple drones at target.
• For promoting drone development, Indian Air force also launched one 3-year long competition in 2018,
named, Mehar Baba Swarm Drone Competition that was open for distinct organizations.
→ Usage:
 According to note sent by Ministry of Civil Aviation (MoCA) on “use of drones” across various sectors to different
central ministries:
• Ministry of Home Affairs:
 For surveillance, situational analysis, crime control, VVIP security, disaster management, etc.
• Ministry of Defence:
 Drones for combat, communication in remote areas, counter-drone solutions, etc.
• Ministry of Health and Family Welfare:
 Delivery of medicines, collection of samples from remote or epidemic / pandemic-affected areas.
• Petroleum and Natural Gas, and Power Ministries:
 For real-time surveillance of assets and transmission lines, theft prevention, visual inspection /
maintenance, construction planning, management, etc.
• Environment, Forests and Climate Change Ministry:
 Anti-poaching actions, monitoring of forests and wildlife, pollution assessment, evidence gathering.
• Ministry of Information and Broadcasting:
 For high-quality videography of events and difficult-to-reach-places. [low altitude shooting without
noise, prevent dust pollution, risk of accidents].
• Other areas:
 To undertake disaster management, incidence response, inspection / maintenance works, project
monitoring.
 Drone use in agriculture:
• Avoid chemical overuse; prepare for weather glitches; Crop spraying; Geo fencing; Crop monitoring;
Monitor growth; Plantation; Soil and field analysis; Livestock Management; Check Crop Health.
• Example – Drones are used in implementing SWAMITVA scheme [2020].
→ Initiative / Drone management:
 In 2021, Ministry of Civil Aviation notified Drone Rules 2021 liberalising drone rules and abolished many
approvals with aim to encourage R&D and to create India as drone hub.
 In 2021, Govt. also approved PLI scheme for drones and their components. It will also promote growth of drone
manufacturing by private companies.
 In 2022, Ministry of Civil Aviation (MoCA) sent note on use of drones across various sectors to different ministries
at Centre.
→ Significance:
 Drones offer tremendous benefits to almost every sector of economy, including national defence, agriculture,
law enforcement, mapping.
 Usage of drones in commercial, safety, law & order, disaster management, surveillance operations reduces
manpower requirement and costs.
Page 242 of 719
  Drones offer low-cost, safe, quick aerial surveys for data collection, which are useful for industries like power,
mining, oil and gas exploration.
→ Need for stricter rules and regulations:
 Drones are used to drop explosive devices, triggering blasts inside Air Force Station’s in Jammu.
 Drones are deployed regularly by Pakistan-based outfits to smuggle arms, ammunition, drugs into Indian
territory.
 drone sightings along border with Pakistan
 With rapid proliferation of drone technology and exponential growth of its global market, possibility of drone
attack cannot be ruled out.
 Drones are becoming security threats particularly in conflict zones where non-state actors are active and have
easy access to drone technology.
 Drones are cheaper in comparison to missiles, fighter jets.
→ Manipur:
 Drone-based vaccine delivery model in Manipur:
• In Manipur, ICMR drone (i-Drone) was used to deliver vaccine.
• To ensure life-saving vaccines reach everyone esp. remote areas and hard to reach terrains.
• In air from Bishnupur district hospital to Loktak lake, Karang island in Manipur
• 1st time that ‘Make in India’ drone is used in South Asia to transport COVID vaccine.
 Electric Vertical Take-Off and Landing (eVTOL) aircraft:
→ What:
 One variety of VTOL (vertical take-off and landing) aircraft that uses electric power to hover, take off,
and land vertically. This technology came about thanks to major advances in electric propulsion
(motors, batteries, fuel cells, electronic controllers) and growing need for new vehicles for urban air
mobility (air taxi). Examples are being developed by aircraft companies such as Boeing, Airbus,
Embraer, Honda, Toyota, Hyundai, and NASA.
→ Feature:
 Most eVTOLs also use what is called as distributed electric propulsion technology which means
integrating complex propulsion system with airframe. This is technology that has grown on account of
successes in electric propulsion based on progress in motor, battery, fuel cell, and el ectronic controller
technologies and also fuelled by need for new vehicle technology that ensures urban air mobility
(UAM).
→ Challenges:
 This technology so far is mix of unpiloted and piloted aircraft, areas in focus include “crash prevention
systems”.
 Issues such as ensuring safety in case of powerplant or rotor failure.
 Aircraft protection from cyberattacks.
→ Significance:
 Global market for eVTOLs is about USD 8.5 million in 2021 and is to grow to about USD 30.8 million by
2030.
 eVTOL demand will be on account of green energy and noise-free aircraft, cargo carrying concepts,
and need for new modes of transport.
→ India:
 Government of India is exploring possibility of inviting manufacturers of eVTOL aircraft to set up base
in India.
 Aviation Fuel:
→ What:
 Aviation fuels are petroleum-based fuels, or petroleum and synthetic fuel blends, used to power aircraft. They
have more stringent requirements than fuels used for ground use, such as heating and road transport, and
contain additives to enhance or maintain properties important to fuel performance or handling. They are
kerosene-based for gas turbine-powered aircraft. Piston-engined aircraft use leaded gasoline and those with
diesel engines may use jet fuel (kerosene) / Aviation Turbine Fuel (ATF).
→ Sustainable aviation fuel:
 What:
• Sustainable aviation fuel is made from sustainable resources, such as forestry and agricultural waste and
used cooking oil and can be blended with fossil jet fuel to reduce emissions. It is one ‘drop-in’ fuel, meaning
it can be added with no changes needed to aircraft. They are biofuels made from sustainable resources,
such as forestry and agricultural waste and used cooking oil and can be blended with fossil jet fuel to reduce
emissions.
 Initiative:
• In 2022, Airlines under Tata umbrella (Air India, AirAsia India, Vistara airline) signed MoU with CSIR–Indian
Institute of Petroleum (CSIR–IIP) to collaborate and work together on research, development, and
Page 243 of 719
 deployment of sustainable aviation fuels (blended fuel for lower carbon emissions). Focus of MoU was
exploration of Single Reactor HEFA Technology for Drop-in liquid Sustainable Aviation and Automotive Fuel
(DILSAAF).
• In 2022, ICAO Member States adopted one collective long-term global aspirational goal of net-zero carbon
emissions by 2050.
 Status:
• Concept of sustainable aviation fuel among Indian airlines is still at nascent stage. So far, there have been
handful of demonstration flights by SpiceJet and IndiGo on blended fuel for lower carbon emissions.
• In 2021, IndiGo partnered with CSIR-IIP on sustainable aviation fuel, including work on Single Reactor HEFA
Technology for Drop-in liquid Sustainable Aviation and Automotive Fuel (DILSAAF).
• Ministry of Civil Aviation, and Ministry of Petroleum and Natural Gas are also working on issuing one
roadmap for sustainable aviation fuel for laying framework for lowering carbon emissions by aviation
industry.
• In 2016, International Civil Aviation Organization (ICAO) adopted one global market-based mechanism -
Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) - to address CO2 emissions
from international aviation.
Note:
 UDAN [2017]:
→ What:
 Ude Desh Ka Aam Nagrik
 flagship initiative of Ministry of Civil Aviation
 also known as Regional Connectivity Scheme (RCS) because UDAN seeks to improve air connectivity to tier-2 and
tier-3 cities through revival of unused and underused airports.
 key component of National Civil Aviation Policy (NCAP) [2016].
→ Aim:
 affordable and widespread air travel.
 Remote / regional air connectivity
 enhancing connectivity to remote and regional areas of India
→ Features:
 nearly ½ of seats in Udan flights are offered at subsidised fares
 participating carriers are provided certain amount of viability gap funding (VGF) – amount shared between
Centre and concerned States.
 will run for 10 years and can be extended.
 Airlines are awarded routes through bidding process [by Civil Aviation Ministry].
 Airlines are required to offer airfares at rate of Rs. 2,500 per hour of flight.
 At least 50% of total seats on aircraft must be offered at cheaper rates.
 To enable airlines offer affordable fares, airlines are given subsidy from Government for 3 years.
 Government would fund for revival of some airports in 1 st 3 years.
→ Phase:
 UDAN 1.0 (5 airlines). UDAN 2.0 (helipads connected). UDAN 3.0 (inclusion of tourism, seaplane route).
 UDAN 4.0 [2019]:
• further expansion to 78 new routes. 4th round of UDAN. special focus on North-Eastern Regions, Hilly States,
Islands. airports already developed by Airports Authority of India (AAI) are given higher priority for awarding
VGF. helicopter and seaplanes are also incorporated.
• UDAN 4.1 (Sagarmala Seaplane service).
 Krishi UDAN (transporting agri-products). International UDAN (smaller cities to international
destination).
→ Fund:
 jointly funded by Union government and State governments.
→ Performance:
 UDAN reached more locations across India.
 Airports Authority of India (AAI) awarded about 900 routes under UDAN, of which many routes connected
airports and heliports.
→ Issue:
 Poor financial health of many smaller, regional carriers.
 Many players don’t have more than 1 or 2 planes and they are often poorly maintained. New planes are too
expensive for these smaller players.
 As of 2021, some routes launched by AAI were discontinued because of failure to set up airports caused by lack
of availability of land, airlines finding routes difficult to sustain, adverse impact of COVID-19 pandemic.
→ UDAN Day:
 21stOctober
Page 244 of 719
 Airports Economic Regulatory Authority of India (Amendment) Bill, 2021:
→ to amend Airports Economic Regulatory Authority of India Act, 2008
→ Provisions:
 Union government may also designate any airport as major airport by notification.
 AERA is allowed to regulate tariff and other charges for aeronautical services for group of airports also.
 Profitable Clubbing:
Government is allowed to club profitable and non-profitable airports to make it viable combination for
investment under Public-Private Partnership (PPP) mode.
→ Significance:
 AERA will be independent tariff regulator.
 improving and expanding air connectivity - remote areas, UDAN regional connectivity scheme etc.
 Encourages development of smaller airports.
→ Need for reforms:
 Typically, airports run risk of becoming monopoly because cities us ually have one civilian airport which
controls all aeronautical services in that area. Thus, to ensure that private airport operators do not
misuse their monopoly, independent tariff regulator (AERA) in airport sector is required.
 Drone Rules, 2021:
→ What:
 notified by Ministry of Civil Aviation (MoCA).
 It eased regulation of drone operations in India by reducing number of forms needed to be filled to operate
drones and decreasing types of fees charged.
→ Feature:
 Digital sky platform shall be developed as business-friendly single-window online system; No flight permission
required upto 400 feet in green zones and upto 200 feet in area between 8-12 km from airport perimeter; No
pilot licence required for micro drones (for non-commercial use), for nano drones, for R&D organisations; No
restriction on drone operations by foreign-owned companies registered in India; Import of drones and drone
components to be regulated by Directorate General of Foreign Trade, Ministry of Commerce (DGFT); No security
clearance required before registration or licence issuance; No requirement of certificate of airworthiness,
unique identification number, prior permission, remote pilot licence for R&D entities; Coverage of drones
increased to 500 kg. This will cover drone taxis also; Issuance of Certificate of Airworthiness delegated to Quality
Council of India (QCI) and certification entities authorised by QCI; Manufacturer may generate their drone’s
unique identification number on digital sky platform through self-certification route; Maximum penalty reduced
to INR 1 lakh. This shall, however, not apply to penalties in respect of violation of other laws; Drone corridors
will be developed for cargo deliveries; Drone promotion council (DPC) will be set up to facilitate business-friendly
regulatory regime;
 Regulatory framework:
• Unique Identification Number (UIN): Every drone, except for those meant for research, development and
testing purposes, is required to be registered and should have one UIN.
• Segregating entire airspace: Airspace map of India segregating entire airspace into red, yellow and green
zones is available on digital sky platform (one website of DGCA). Operation of drones in red and yellow
zones is subject to approval of GOI and concerned Air Traffic Control (ATC) authority respectively. No
approval is required for operation of drones in green zones.
• Empowering State and UT Governments: State Government, UT Administration and Law enforcement
agencies have been empowered under this Rules to declare temporary red zone for specified period.
• Type certification: Drones are required to have necessary type certification issued by DGCA. No type
certification is however required in case of nano drones (up to 250 gram all-up weight) and model drones
made for research and recreation purposes.
• Personal details: Owner and operators of drones are required to furnish necessary personal details including
their Indian passport number etc. for issuance of any registration or licence.
• This rule also has provision of transfer of drone to another person by way of sale, lease, gift or any other
mode, after providing requisite details of transferor, transferee and UIN of drone on digital sky platform
along with applicable fees.
• Remote Pilot Training Organizations (RPTO): Authorisation of RPTO will be done by DGCA within specified
time limits.
• Punishment for violation: Drone operations that violate provisions of Drone Rules, 2021 are punishable
under this Drone Rules, 2021 as well as provisions of any other law, for time being in force.
 Indrajaal:
→ What:
 Drone defence dome.
 Autonomous drone defense dome system.
 India’s 1st indigenous drone defence dome.

Page 245 of 719

  designed and developed by Grene Robotics (Hyderabad-based R&D technology firm)
→ Features:
 autonomously protects area of 1000-2000 sq km against aerial threats - UAVs, loitering munitions, Low-Radar
Cross Section (RCS) targets.
 Flying Wing Technology Demonstrator:
→ One autonomous UAV of DRDO. In 2022, DRDO successfully carried out maiden test flight of this new autonomous
UAV.
→ This UAV is designed and developed by Aeronautical Development Establishment (ADE), Bengaluru, (one lab of
DRDO)
→ It is powered by one small turbofan engine.
→ This vehicle’s airframe, undercarriage and entire flight control, as well as avionics systems, have been developed
indigenously.
 Convention on International Civil Aviation / Chicago Convention [1944]:
→ This convention established International Civil Aviation Organization (ICAO), one specialized agency of UN charged
with coordinating international air travel. This Convention establishes rules of airspace, aircraft registration and
safety, security, and sustainability, and details rights of signatories in relation to air travel. This Convention also
contains provisions pertaining to taxation.
 Bilateral Air Service Agreement:
→ What:
 Any designated foreign airline can operate to / from point in India if it is designated as point of call in bilateral
Air Services Agreement (ASA) signed between India and that country. India signed ASAs with 116 foreign
countries.
→ Feature:
 Indian designated carriers are free to mount scheduled operations to / from any international airport, including
Kannur International Airport (Kerala), under ambit of bilateral ASAs concluded by India with foreign countries.
→ Status:
 India signed Bilateral Air Service Agreement with 116 countries. Currently, due to significant imbalance in
number of points of call in favour of foreign carriers, GOI is not granting any non-metro airport as new point of
call to any foreign carrier for purpose of operating passenger services.
 India’s Open Sky Policy:
→ National Civil Aviation Policy (2016) allows GOI to enter into ‘open sky’ air services agreement on reciprocal basis
with SAARC nations as well as countries beyond 5,000 km radius from New Delhi. It implies that nations within 5,000
kilometres of distance need to enter into bilateral agreement and mutually determine number of flights that their
airlines can operate between two countries. India has open sky agreements with Greece, Jamaica, Guyana, Finland,
USA, Japan, etc. Degree of “sky openness” depends on freedoms of air in that country granted to foreign airlines.
There are 9 such freedoms according to Convention on International Civil Aviation [1944].
 Freedoms of air:
→ They are set of commercial aviation rights granting one country's airlines privilege to enter and land in another
country's airspace. They were formulated as result of disagreements over extent of aviation liberalisation in
Convention on International Civil Aviation, 1944, known as Chicago Convention. USA had called for standardized set
of separate air rights to be negotiated between states, but most other countries were concerned that size of U.S.
airlines would dominate air travel if there were not strict rules. Freedoms of air are fundamental building blocks of
international commercial aviation route network. Use of terms "freedom" and "right" confers entitlement to operate
international air services only within scope of multilateral and bilateral treaties (air services agreements) that allow
them. There are 9 such freedoms according to Convention on International Civil Aviation [1944]. They are: Right to
fly over foreign country without landing; Right to refuel or carry out maintenance in foreign country without
embarking or disembarking passengers or cargo; Right to fly from one's own country to another country; Right to fly
from another country to one's own; Right to fly between two foreign countries on flight originating or ending in one's
own country; Right to fly from foreign country to another while stopping in one's own country for non-technical
reasons; …..
 Convention on International Civil Aviation / Chicago Convention [1944]:
→ This 1944 convention established International Civil Aviation Organization (ICAO), one specialized agency of UN
charged with coordinating international air travel. This Convention establishes rules of airspace, aircraft registration
and safety, security, and sustainability, and details rights of signatories in relation to air travel. This Convention also
contains provisions pertaining to taxation.
 Radar Altimeter / Radio Altimeter / Electronic Altimeter / Reflection Altimeter / Low-range Radio Altimeter:
→ Instrument that measures altitude above terrain presently beneath aircraft or spacecraft by timing how long it takes
beam of radio waves to travel to ground, reflect, and return to aircraft. This type of altimeter provides distance
between antenna and ground directly below it, in contrast to barometric altimeter which provides distance above
defined vertical datum, usually mean sea level.
Instrument that provides direct height-above-terrain information to various aircraft systems. These altimeters
as well as part of 5G telecom services operate in C-Band and therefore risks interference.
Page 246 of 719
  Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) [2016]:
→ One carbon offset and carbon reduction scheme to lower CO2 emissions for international flights, to curb aviation
impact on climate change. It was developed by International Civil Aviation Organization (ICAO). Its goal is to have
carbon neutral growth from 2020. CORSIA uses Market-based environmental policy instruments to offset CO2
emissions by mandating aircraft operators to purchase carbon credits from carbon market. Starting in 2021, this
scheme is voluntary for all countries until 2027. Under this agreement, global aviation emissions target is 50%
reduction by 2050 relative to 2005.
It is one global market-based mechanism to address CO2 emissions from international aviation. CORSIA aims to
stabilise net carbon emissions from international civil aviation using offsetting programmes. [Offsetting is action by
company or individual to compensate for their emissions by financing reduction in emissions elsewhere]. Under this,
from 2021 until 2026, only flights between states that volunteer to participate will be subject to offsetting
requirements. Countries that have volunteered cover about 77% of all international aviation activity. Beginning 2027,
virtually all international flights will be subject to mandatory offsetting requirements, representing more than 90%
of all international aviation activity.
 Avgas:
→ It is also known as Aviation gasoline (Aviation spirit in UK). It is one aviation fuel used in aircraft with spark-ignited
internal combustion engines. Avgas is distinguished from conventional gasoline (petrol) used in motor vehicles, which
is termed mogas (motor gasoline) in aviation context. Unlike motor gasoline, which has been formulated since 1970s
to allow use of platinum-content catalytic converters for pollution reduction, most commonly used grades of avgas
still contain tetraethyllead (TEL), one toxic substance used to prevent engine knocking (premature detonation). There
are ongoing experiments aimed at eventually reducing or eliminating use of TEL in aviation gasoline.
Kerosene-based jet fuel is formulated to suit requirements of turbine engines which have no octane requirement
and operate over much wider flight envelope than piston engines. Kerosene is also used by most diesel piston engines
developed for aviation use.
→ Initiative:
 In 2022, GOI launched AVGAS 100 LL.
→ AVGAS 100 LL:
 In 2022, GOI launched AVGAS 100 LL (one special aviation fuel meant for piston engine aircrafts and UAVs). With
this, India will save precious foreign exchange with launch of this indigenous AVGAS 100 LL. Indian Oil Cor.
became 1st Oil Marketing Company to produce and market AVGAS 100 LL in India. AVGAS 100 LL fuel is developed
by Indian Oil Corporation.
It is one higher-octane Aviation fuel meeting product specifications with superior performance quality
standards, as compared to imported grades. This indigenous availability of AV GAS 100 LL will help reduce
dependence on imports and address associated logistical challenges. India will be able to save precious foreign
exchange with in-house availability of this product.
Value Addition:
 Aviation turbine fuel (ATF) is not within ambit of Goods and Services Tax (GST)
 0 / 20 norm:
→ 5/20 norm was brought in by Min. of Civil Aviation to allow Indian private carriers to fly overseas. This norm / rule
said that airline based in India will need to have:
 at least 5 years of experience of flying within India; and
 at least 20 aircraft on its fleet
before it qualifies to fly overseas.
→ In 2016, National Civil Aviation Policy, 2016 replaced 5 / 20 norm with 0 / 20 norm, allowing airlines to launch
international operations with no domestic experience but at least 20 aircraft (or 20% of its entire fleet size). [to
benefit both AirAsia India and Vistara, which is joint venture between Tata and Singapore Airlines]
Mains Link:
 Discuss the performance of UDAN scheme.
 Discuss the need for and significance of AERA Bill, 2021.
 Discuss the significance of the new rules.
 The challenges associated with eVTOL, need to be addressed before they become new vehicles of Urban Air Mobility.
Comment.

ARTIFICIAL INTELLIGENCE (AI)

News:
 2022:
→ One Google engineer claims that Google LaMDA is sentient (able to perceive or feel things) because its answers
allegedly hint that it understands what it is. He claims that this AI neural network with deep learning capacity has
consciousness of child of 7 or 8 years old. He argues that consent from this software must be obtained before
experiments are run on it.
 Counter View: Baby learns language from close interaction with caregivers and not by acquiring massive amount
of language data. Moreover, whether intelligence is same as sentience is questionable.
Page 247 of 719
 → “Deepmind Technologies” (one British AI subsidiary of Alphabet Inc.) recently released 3D predicted structures of
over 200 million proteins. Generated by its AI system AlphaFold, it aims to help researchers enhance their
understanding of how proteins — building blocks of life — may fold.
About:
 What:
→ AI is intelligence demonstrated by machines, as opposed to natural intelligence displayed by animals including
humans. AI research has been defined as field of study of intelligent agents, which refers to any system that perceives
its environment and takes actions that maximize its chance of achieving its goals. This term "artificial intelligence"
had previously been used to describe machines that mimic and display "human" cognitive skills that are associated
with human mind, such as "learning" and "problem-solving". This definition has since been rejected by major AI
researchers who now describe AI in terms of rationality and acting rationally, which does not limit how intelligence
can be articulated. AI is branch of computer science dealing with simulation of intelligent behavior in computers. AI
is intelligence in computers or other machines.
John McCarthy, American computer scientist, 1st introduced world to term “artificial intelligence” at 1955
Dartmouth Conference.
AI include Computer vision, Biometrics, Robotics / Sensors, ML.
 Example:
→ AI applications include advanced web search engines (e.g., Google), recommendation systems (used by YouTube,
Amazon, Netflix), understanding human speech (such as Siri, Alexa), self-driving cars (e.g., Tesla), automated
decision-making and competing at highest level in strategic game systems (such as chess, Go). As machines become
increasingly capable, tasks considered to require "intelligence" are often removed from definition of AI, phenomenon
known as AI effect. For instance, optical character recognition is frequently excluded from things considered to be
AI, having become routine technology. Facebook’s facial recognition software which identifies faces in photos we
post, voice recognition software that translates commands we give to Alexa (Amazon), etc.
 How intelligent are AI’s?
→ To test intelligence of machines Alan Turning devised one practical solution. Place one computer in closed room and
one human in another. If interrogator interacting with machine and human cannot discriminate between them, then
Turing said that computer should be construed as ‘intelligent’.
 Is AI technology dangerous?
→ Unethical AI continuing historical bias and echoing hate speech may cause real dangers to society. Example, if AI is
to select candidates for any supervisory role, then Women and marginalized communities hardly get in as AI would
analyze centuries-old data, which would exclude these sections as they were discriminated against during that time.
 Status:
→ According to NITI Aayog, AI has potential to add USD 1 trillion to India’s economy by 2035. And, as per some experts
and academicians, significant amount of this would be in agriculture sector.
 AI in agriculture:
→ Application:
 Efficient and cost-effective resource and yield management in agricultural sector; Enable Smart Agriculture: It
refers to usage of technologies like IOT, sensors, location systems, robots, AI on our farm. AI, cloud computing,
satellite imagery, and advanced analytics, in combination, can create ecosystem for smart agriculture; Prediction
analysis: AI will ensure highest possible yields based on seasonal forecast models; Address supply-demand
mismatch in real-time. For example, supply-demand engine or predictor that can map supply and demand;
Precision farming by determining whether pesticides and weedicides should be used by detecting and targeting
weeds in identified buffer zone. This can lead to higher yields and reduced use of pesticides and weedicides;
Extension services: AI-based natural language translation facilitates issuance and spread of Agri-advisories,
weather forecasts, and early warnings for droughts in multiple vernacular languages.
→ Challenges:
 Lack of proper infrastructure and know-how; faith in conventional styles of functioning; lack of awareness;
scarcity of farmer capital; Fragmentation of land could also prove to be hurdle for large-scale implementation
of new technologies.
→ Measures taken:
 ICAR initiatives for cyber agro-physical systems to make Indian farming viable, self-sustaining, and internationally
competitive enterprise; NITI Aayog identifies agriculture as one of focus areas as part of its National Strategy for
Artificial Intelligence (INDIAai).
→ Conclusion:
 It is high time that collaborative Agri-data stacks are created and MSME and large corporations invest in this
space. There is need for right mix of participation from public and private institutions.
 AI in Biology:
→ Example: Alphabet’s Deepmind Technologies recently predicted 3D structures of over 200 million proteins.
Generated by its AI system AlphaFold, it aimed to help researchers enhance their understanding of how proteins —
building blocks of life — may fold.
→ Proteins:
Page 248 of 719
  Human body is estimated to have 20,000 to over 100,000 unique types of proteins within a cell with each having
a specific function. These proteins are made up of long chains of 20-22 different types of amino acids linked by
peptide (shorter chain of amino acids) bonds. Their order determines how the protein chain will fold upon itself
into a 3D structure.
 Importance of Folding: Folding lets proteins adopt functional shape or conformation. If researchers can predict
how proteins fold, they can better learn how cells function and how misfolded proteins can cause diseases.
AlphaFold uses AI to predict protein’s 3D structure from its amino acid chain, thereby helping learn how cell
functions, and related diseases and accelerating discovery of drugs.
 Initiative:
→ Responsible AI for Youth 2022; National Programme on AI; Artificial Intelligence Research, Analytics and Knowledge
Assimilation Platform (AIRAWAT) – one cloud computing platform; National Strategy for Artificial Intelligence; V.
Kamakoti committee on Artificial Intelligence: set up digital data banks, marketplaces and exchanges to ensure
availability of cross-industry information; National Mission for Artificial Intelligence.
Note:
 Intelligence:
→ What:
 Intelligence is defined in many ways: capacity for abstraction, logic, understanding, self-awareness, learning,
emotional knowledge, reasoning, planning, creativity, critical thinking, and problem-solving. More generally, it
can be described as ability to perceive or infer information, and to retain it as knowledge to be applied towards
adaptive behaviors within environment or context. Intelligence is most often studied in humans but has also
been observed in both non-human animals and in plants despite controversy as to whether some of these forms
of life exhibit intelligence. Intelligence in computers or other machines is called artificial intelligence.
→ Types:
 Sentient: Ability to feel, perceive things and having some consciousness. Example, Dog – even though they can
feel pain and emotions but lack capacity for intelligence like humans do.
 Sapient: Ability to think, capacity for intelligence, ability to acquire wisdom. Example, Human – from years of
evolution they developed ability to acquire knowledge and wisdom.
 Responsible AI for Youth 2022:
→ What: Launched by National e-Governance Division (MeITy) and Intel India.
→ Aim: To enable school students (class 8-12) with AI skills in inclusive manner through exclusive hands-on learning
and mentorship opportunities.
Question:
 With present state of development, AI can effectively do: Bring down electricity consumption in industrial units; Create
meaningful short stories and songs; Disease diagnosis; Text-to-Speech Conversion; Wireless transmission of electrical
energy.
Mains Link:
 Artificial Intelligence will revolutionize the farming sector in India. Critically comment. (15M)
 As with most technologies, there will be positive and negative impacts on society as artificial intelligence continues to
transform the world that we live in. Examine. (15M)

ANTARCTICA
News:
 2021:
→ As glacier (Ronne Ice Shelf) retreats, Iceberg A-76 calved (breaking of ice from edge of glacier) from Ronne
Ice Shelf in Antarctica.
 2022:
→ Parliament passes Indian Antarctic Bill, 2022 to regulate and monitor activities at India’s research stations in frozen
continent (Antarctica).
About:
 What:
→ For purposes of Antarctic treaty system (ATS), Antarctica is defined as - all of land and ice shelves south of 60°S
latitude. Earth's only continent without native human population.
 Antarctic Treaty, 1959:
→ What:
 Signed in Washington, USA for making Antarctic Continent a demilitarized zone and to be preserved for scientific
research only. Headquarters - Buenos Aires, Argentina. For purposes of Antarctic treaty system, Antarctica is
defined as - all of land and ice shelves south of 60°S latitude. Antarctic Treaty is only example of single treaty
that governs whole continent. India is party.
→ Provision:
 Antarctica shall be used for peaceful purposes only. Freedom of scientific investigation in Antarctica and
cooperation towards that end shall continue. Scientific observations and results from Antarctica shall be

Page 249 of 719

 exchanged and made freely available. Neutralisation of territorial sovereignty in Antarctica. Freeze on any
disputes between claimants over their territories on Antarctica continent.
→ Significance:
 Only example of single treaty that governs whole continent. Foundation of rules-based international order for
continent without permanent population. has been able to successfully respond to many challenges.
→ Relevancy today:
 Circumstances are radically different now in 2020s compared to 1950s: Antarctica is much more accessible, due
to technology, climate change. More countries now have substantive interests in Antarctica continent. Some
global resources are becoming scarce, especially oil. Uncertainty as to China’s intentions in Antarctica. [China
joined Antarctic treaty, 1959 in 1983 and became consultative party later. Potential for Antarctic mining in future
may increase. Therefore, revisiting prohibition on Antarctic mining would be way forward.
 Antarctic Treaty System (ATS):
→ What:
 Antarctic Treaty, 1959 and related agreements are collectively known as Antarctic Treaty System (ATS). It
regulates international relations with respect to Antarctica.
→ Agreements:
 Antarctic Treaty system (ATS) is made up of 4 major international agreements: 1959 Antarctic Treaty. 1972
Convention for Conservation of Antarctic Seals. 1980 Convention on Conservation of Antarctic Marine Living
Resources. 1991 Protocol on Environmental Protection to Antarctic Treaty, 1959.
→ Why / Need:
 Disputes have occurred over years. And, many disputes have been addressed through expansion of treaty
framework with aforementioned agreements. This framework is now referred to as - Antarctic Treaty System
(ATS).
 Concern:
→ Antarctica ice sheet is warming faster than rest of Earth. This warming causes melting of snow and ice
covers and retreat of glaciers, especially in Weddell Sea. As glaciers retreat, chunks of ice break off and
float adrift until they break apart or crash into land.
 India:
→ In 1983, India signed Antarctic Treaty, 1959. Nodal Agency: National Centre for Polar and Ocean Research
(NCPOR) (1998) under Ministry of Earth Sciences.
→ Indian Antarctic Program [1981]: multi-disciplinary, multi-institutional program. under control of Ministry of
Earth Sciences (MoES). In 1981, 1st Indian expedition to Antarctica was initiated. In 1983 itself, India constructed
Dakshin Gangotri Antarctic research base: It is 1st Indian scientific research base station (now just supply base). In
1989, Dakshin Gangotri was superseded by Maitri base [1989]: It is situated near Schirmacher Oasis (India has also
built one freshwater lake around it called Lake Priyadarshini). Sagar Nidhi [2008]: It is 1st Indian vessel to navigate
Antarctic waters. In 2012, India constructed Bharati. Under this program, India carries out scientific expeditions to
Antarctic and studies: atmospheric, biological, earth, chemical, medical sciences. Bharati is research facility.
→ As of now, India has 2 research stations: Maitri [1989]; Bharati [2012].
→ Indian Antarctic Bill, 2022.
Note:
 Antarctic Impulsive Transient Antenna (ANITA) [2006]:
→ radio telescope to detect ultra-high energy cosmic-ray neutrinos from scientific balloon (equiped with
radio antennas) flying over Antarctica. experiment to study ultra -high-energy (UHE) cosmic neutrinos by
detecting radio pulses emitted by their interactions with Antarctic ice sheet, by using array of radio
antennas suspended from helium balloon flying at height of about 37 km above Antarctica surface. 1st
NASA observatory for neutrinos.
 Iceberg A-76:
→ In 2021, Iceberg A-76 calved / broke from Ronne Ice Shelf in Antarctica. world's largest floating iceberg.
now floating in Weddell Sea, Antarctica.
 Indian Antarctic Bill, 2022:
→ What:
 Bill to provide for national measures for protecting Antarctic environment and dependent and associated
ecosystems and to give effect to Antarctic Treaty 1959, Convention on Conservation of Antarctic Marine Living
Resources 1980, Protocol on Environmental Protection to Antarctic Treaty 1991. This 2022 Bill seeks to give
effect to Antarctic Treaty, Convention on Conservation of Antarctic Marine Living Resources, and Protocol on
Environmental Protection to Antarctic Treaty. It also seeks to protect Antarctic environment and regulate India’s
activities in Antarctic region.
→ Need:
 Antarctic treaty (signed in 1959 and implemented in 1961) made it mandatory for 54 signatory countries to
specific laws governing territories on which their stations are located. India signed this treaty in 1983 and
therefore law was needed to preserve pristine Antarctic environment and ocean around it. Initially, India was
left out of 1959’s Antarctica Treaty, but it made maiden voyage in 1982 (under Operation Gangotri).
Page 250 of 719
 → Objectives:
 To demilitarise Antarctica, establish it as zone free of nuclear tests and disposal of radioactive waste, and ensure
that it is used for peaceful purposes only; to promote international scientific cooperation in Antarctica and to
set aside disputes over territorial sovereignty.
→ Feature:
 Applicability:
• Its provisions will apply to any person, vessel or aircraft that is part of Indian expedition to Antarctica under
permit issued under this Bill. Areas comprising of Antarctica include: continent of Antarctica, including its
ice-shelves, and all areas of continental shelf adjacent to it; and all islands (including their ice-shelves), seas,
and air space south of 60°S latitude.
 Central committee:
• Central government will establish one Committee on Antarctic Governance and Environmental Protection.
This Committee will be chaired by Secretary of Ministry of Earth Sciences. This committee’s functions
include: granting permits for various activities; implementing and ensuring compliance of relevant
international laws for protection of Antarctic environment; obtaining and reviewing relevant information
provided by parties to aforesaid Treaty, Convention, Protocol; negotiating fees / charges with other parties
for activities in Antarctica.
 Permit:
• Permit by said Committee or written authorisation from another party to Protocol (other than India) will be
required for various activities such as: Indian expedition to enter or remain in Antarctica; person to enter
or remain in Indian station in Antarctica; vessel or aircraft registered in India to enter or remain in Antarctica;
person or vessel to drill, dredge or excavate for mineral resources, or collect samples of mineral resources;
activities which may harm native species; waste disposal by person, vessel or aircraft in Antarctica. Before
permit is granted by said Committee, applicant has to carry out environmental impact assessment (EIA) of
proposed activities. Moreover, permit must not be granted unless waste management plan has been
prepared for expedition by said Committee.
 Prohibited activities:
• This Bill prohibits certain activities in Antarctica including: nuclear explosion or disposal of radioactive
wastes; introduction of non-sterile soil; discharge of garbage, plastic or other substance into sea which is
harmful to marine environment.
 Offences and penalties:
• This 2022 Bill specifies penalties for violatin of its provisions. For instance, conducting nuclear explosion in
Antarctica will be punishable with imprisonment of 20 years to life imprisonment and fine of at least Rs. 50
crore. Drilling for mineral resources or introducing non-native animals or plants in Antarctica without permit
will be punishable with imprisonment up to 7 years and fine between Rs. 10 lakh and Rs. 50 lakh. Central
government may notify Sessions Courts to be Designated Court under this Bill and specify its territorial
jurisdiction to try offences punishable under this Bill.
 Antarctic Fund:
• This Bill provides for constitution of one fund to be called Antarctic fund which shall be applied towards
welfare of Antarctic research work and protection of Antarctic environment.
→ Fact:
 Since 1983, India has been signatory to Antarctic Treaty, 1959. This Treaty made it mandatory for its signatory
countries to specify laws governing territories on which their stations are located. Thus, India is specifying laws
via Indian Antarctic Bill, 2022 governing portions of Antarctica continent where India has its research bases. India
is also signatory to treaties such as Convention on Conservation of Antarctic Marine Living Resources /
Commission for Conservation of Antarctic Marine Living Resources (CCAMLR), which instructs its party
signatories to help preserve pristine nature of Antarctica continent. There is growing concern over preserving
pristine Antarctic environment and ocean around Antarctica from exploitation of marine living resources and
human presence in Antarctica. India is also member of Council of Managers of National Antarctic Programs
(COMNAP); Scientific Committee on Antarctic Research (SCAR).
→ Issues remaining:
 Issue of polar research vessel still needs to be addressed immediately. So far, India has been chartering such
ships from countries like Russia, Norway while China has raced ahead and has 2 of its own.
→ What next:
 Acquisition of vessel with ice-breaking and other technological capabilities on permanent basis. Revamp of old
Maitri research station. Polar research vessel will also be required as India expands its association with and
involvement in Arctic as well.
Question:
 Formation of ozone hole in Antarctic region has been cause of concern. Reason for formation of this hole is presence of
prominent polar front and stratospheric clouds; and inflow of CFCs.
Mains Link:
 Discuss the objectives of the Antarctic Treaty. Is it relevant still today? Discuss. (15M)
Page 251 of 719
  Throw light on the Indian interests in the Antarctic region. Analyze the role that Indian Antarctic Bill, 2022 can play in to
protecting the Antarctic environment and regulating activities in the region. (250 Words)

GOODS AND SERVICES TAX / GST TAX [2017]

News:
 2021:
→ Finance Minister termed GST revenue gap due to Covid-19 situation as unforeseen “act of God”.
→ Centre to release GST compensations to States, from compensation cess collections.
→ Supreme Court warns that government has no option but to constitute GST Appellate Tribunal.
→ Supreme Court confirms Madras High Court judgment which upheld one fiscal formula included in Central
Goods and Service Tax (CGST) Rules to execute refund of unutilised Input Tax Credit (IT C) accumulated due
to inverted duty structure.
→ GST Network blocks crores worth of input tax credit (ITC) of thousands of businesses registered under
Goods and Service Tax. [GST rules give powers to GST Network to block ITC available in electronic credit
ledger of taxpayer if it has reasons to believe that ITC was availed fraudulently.]
→ Central Board of Indirect Taxes and Customs (CBIC) comes out with norms on blocking of tax credit by GST
field officers. CBIC further says such blocking should be on basis of ‘material evidence’ and not just out of
‘suspicion.’
 2022:
→ Many States demand that GST compensation scheme be extended beyond June 2022.
 Reason: Their States’ revenues adversely impacted by GST. Impact of COVID-19 pandemic on overall economy
and more specifically on States’ revenues (forced to spend substantially more on public health emergency, socio-
economic fallout residents).
 Background: Adoption of GST was made possible by States ceding almost all their powers to impose
local-level indirect taxes and agreeing to let multiplicity of imposts taxes be subsumed into GST. This
was agreed on condition that revenue shortfalls arising from transition to GST would be made from
pooled GST Compensation Fund for period of 5 years that will end in June 2022.
→ Supreme Court’s judgment upheld Gujarat High Court ruling that Centre cannot levy Integrated Goods and
Services Tax (IGST) on ocean freight from Indian importers.
 Supreme Court’s other observation: GST Council’s recommendations are of “persuasive value” and are not
binding on Centre and State governments. Parliament and State legislatures have equal, simultaneous and
unique powers to make laws on GST – Article 246A.
 Implication: This would have far-reaching implications on various other matters where States are not in
agreement with decision of GST Council, especially in light of compensation period coming to end in 2022. This
ruling clearly defines role of GST Council – to advise and recommend on GST issues. To accept such advice and
pass appropriate amendments in law is purely domain of Central and State legislatures.
→ Centre releases entire amount of GST compensation payable to States up to May 31, 2022 by releasing
amount of Rs. 86,912 crore. This is being done to assist States in managing their resources and ensuring
that their programmes, especially expenditure on capital, is carried out successfully during this financial
year.
→ Min. of Finance says GST collections rose 28% to Rs 1.49 lakh crore on annual basis in July 2022 on back of
economic recovery and measures taken to curb tax evasion.
 Reason: Higher inflation rate, Economic recovery means higher consumption pattern, Stricter action against Tax
evasions, Better compliance with Rules.
→ Supreme Court tells Centre, GST Council to advise States to implement system of electronic generation of
Document Identification Number (DIN) in indirect tax administration (GST) so as to bring in transparency,
accountability. [Kerala and Karnataka have already implemented it.].
→ FM Sitharaman says GST Council is still one fledgling 5-year-old institution that has yet to become well -
settled, but acts as one vibrant forum for intense interactions between Centre and States.
Constitution:
 Article 246A (Special provision with respect to goods and services tax):
→ (1) Parliament, and subject to clause (2) State Legislature, have power to make laws with respect to goods
and services tax imposed by Union or by State.
→ (2) Parliament has exclusive power to make laws with respect to goods and services tax where supply of
goods, or of services, or both takes place in course of inter -State trade or commerce.
 Article 269A (Levy and collection of goods and services tax in course of inter-State trade or commerce).
 Article 279A (Goods and Services Tax Council).
About:
 What:
→ Single tax on supply of goods and services, right from manufacturer to consumer. Destination based tax
unlike previous taxation scheme which was origin based. Indirect tax (or consumption tax) used in India
on supply of goods and services. It is comprehensive, multistage, destination -based tax: comprehensive
Page 252 of 719
 because it has subsumed almost all indirect taxes except few State taxes; Multi-staged as GST is imposed
at every step in production process, but is meant to be refunded to all parties in various stages of
production other than final consumer; Destination -based tax as it is collected from point of consu mption
and not point of origin like previous taxes.
GST is one value-added tax levied on most goods and services sold for domestic consumption. It is
based on principle of destination-based consumption taxation as against previous principle of origin -based
taxation.
GST was introduced with the motive of “one nation one tax”. Earlier traders and businessmen had to
pay various indirect taxes — excise duty, VAT, sales tax, service tax, octroi — and were subjected to
harassment, corruption and clearance issues at various tax departments.
 Constitutional:
→ Constitution (101st Amendment) Act, 2016: Conferred simultaneous power upon Parliament and State
Legislature to make laws governing GST. Subsuming Central and State taxes under GST. Levy of IGST on
inter-State transactions of goods and services. GST on all goods and services except alcohol ic liquor.
Petroleum and petroleum products shall be subjected to levy of GST on later date as decided by GST
Council.
→ It inserted Article 246A. It inserted Article 269A. It inserted Article 279A. It amended some other Articles.
 Origin:
→ GST was 1 st mooted in year 2003 by Kelkar Task Force on indirect taxes, who suggested subsuming various
central and State indirect taxes into one indirect tax.
 Feature:
→ High Working Capital, ITC, Limited Compliance, Transparency, Less Tax Liability, No Cascading Effe ct.
→ Single tax on supply of goods and services, right from manufacturer to consumer. Destination based tax
unlike previous taxation scheme which was origin based. Value based tax as credits of input taxes paid at
each stage will be available in subsequent stages. Final consumer will bear only GST charged by last dealer
in supply chain. At central level, following taxes are being subsumed under GST: Central Excise Duty,
Additional Excise Duty, Service Tax, Countervailing Duty, Special Additional Duty of Cust oms. At State level,
following taxes are being subsumed under GST: State VAT / Sales Tax, Entertainment Tax, Central Sales
Tax, Octroi and Entry Tax, Purchase Tax, Luxury Tax, Taxes on lottery, betting and gambling.
→ GST Administration:
 Since there is federal structure in India, there are 2 components of GST: Central GST, State GST. Both
CGST and SGST will be simultaneously levied across value chain, both on goods and services. GST tax
will not be levied on exempted goods (alcohol, petroleum and its products ) and those transactions
which are below prescribed threshold limits. Input tax credit of CGST will be available for discharging
liablity on CGST itself and similarly for SGST. Thus, no cross utilization of credit would be permitted
except in case of IGST. IGST would come into picture when there is inter -State transfer of goods and
services. IGST rate would be roughly equal to sum of CGST and SGST. For implementation of GST in
India, Central and State governments have registered GST Network (GSTN) which is not for profit, non-
government company to provide shared IT infrastructure to central and State government, tax payers
and other stakeholders. Tax payments and credit will be done through online network. Taxation on
Imports – CVD and SAD on imports will be subsumed under GST. States where goods are imported will
gain their share from IGST paid on imported goods.
 Benefit:
→ Unified market, eliminating cascading effect, easy compliance, low tax evasion, increase in GDP, widen tax
base, easy administration, reduced inflation.
→ GST will replace multiple taxes collected by multiple authorities and will thus create one single market in
India.
→ For Business and Industry: Easy compliance as one tax to be paid. Creation of one market which will
facilitate Ease of Doing Business in India. Removal of cascading taxes which will lower price, thereby
boosting demand. Improve competitiveness as transaction cost for doing business would reduce. Also, now
most competitive good will sell across India irrespective of location where it is manufactured. Expected to
provide boost to ambitious Make in India programme.
→ For Consumer: No cascading burden of taxes which would moderate inflation. More transparency in
taxation regime. Easier taxation regime to understand for customers.
→ For government:
 GST taxation regime will be easier to adminsiter for government. Input Tax Credit system creates
mechanism for self-policing. Dual monitoring by Centre and States will lead to tax competition and
cooperation between Centre and States. On flip side, corporates fear two sources of interface with tax
department. Better control on leakages due to lesser evasion. Higher revenue efficiency. More money
to spend on welfare expenditure. Since, GST is destination based tax, poorer States which have low
level of manufacturing and services industry are expected to benefit.
 Formula:
Page 253 of 719
 → GST Payable / GST Credit / Balance ITC = Output GST (Tax on Sales) – Input GST (Tax on Purchase + Tax on
Expense + Tax on Machine)
 GST impact on Fiscal Federalism:
→ Constitutional provisions with respect to Fiscal Federalism has 2 major imbalances:
 Vertical Imbalance: Mismatch between expenditure and revenue requirements. Centre possessed
more revenue but less expenditure whereas vice versa is true for States.
 Horizontal Imbalance: There is disparity in revenue accrued by States.
→ So far, States had autonomy in deciding tax rates for those items falling in State list, as well as deciding
VAT rates. With advent of GST, following issue is likely to crop up in Fiscal Federalism:
 States will lose their autonomy in deciding taxation rates based on their expenditure plan. In GST
regime, rates will be decided by GST Council. However, GST Council will fix “floor rate along with
bands”. This will leave some autonomy for States to mending with tax rates to suit themselves.
→ However, it is to be realized that GST is required. Moreover, Indian GST regime offers advantages unlike
GST regime in other large federal polities, where system is either too centralized, which de prives sub
federal levels of fiscal autonomy, such as in Australia, Germany, Austria or, independently administered,
which creates too many differences in tax bases and rates that make compliance difficult and also makes
inter-State transaction difficult to tax, such as in South Africa. Indian GSY system however establishes
desirable coordination like in Canada. Common base and common rate will facilitate tax administration
and ensure compliance. Reasonable exceptions, as decided by GST Council, will provid e degree of fiscal
autonomy to States.
 GST Compensation scheme:
→ What:
 Goods and Services Tax (Compensation to States) Act, 2017 guarantees that States would be
compensated for loss of revenue in 1 st 5 years of GST implementation (until June 2022), by levying cess
on sin and luxury goods (demerit goods). This shorfall compensation is known as GST Compensation
cess, which would be given from Compensation Cess Fund. It will be levied on demerit goods - pan
masala, cigarettes products, tobacco products, aerated water, caffeinated beverages, coal, certain
passenger motor vehicles.
→ Background:
 Adoption of GST was made possible by States ceding almost all their powers to impose local -level
indirect taxes and agreeing to let multiplicity of imposts taxes be subsumed into GST. This was agreed
on condition that revenue shortfalls arising from transition to GST would be made from pooled GST
Compensation Fund for period of 5 years that will end in June 2022.
→ Can GST compensation deadline be extended?
 Deadline was set in original legislation and so in order to extend it, GST Council must 1 st recommend
it and Union government must then move amendment to GST law.
→ Compensation Cess Fund:
 created under Goods and Services Tax (Compensation to States) Act, 2017 to compensate / pay States
for any shortfall in GST collection. It will be filled / credited by levying additional cess on sin and luxury
goods: pan masala, cigarettes, tobacco products, aerated water, caffeinated beverages, coal, certain
passenger motor vehicles. Also, other amounts recommended by GST Council would be credited to
this fund.
 GST Council, constitutional body, created with 2/3rd representation from States and 1/3rd from Centre
to examine issues related to GST and make recommendation on rates, taxes, cesses , surcharges,
exemption list, dispute resolution etc. All decisions in GST Council to be taken by 3/4 th . It will function
under chairmanship of Union Finance Minister. Compensation to States for entire amount of revenue
losses for 5 years.
 GST Council:
→ What:
 It is constitutional body, created with 2/3rd representation from States and 1/3rd from Centre to
examine issues related to GST and make recommendation on rates, taxes, cesses, surcharges,
exemption list, dispute resolution etc. One joint forum of Centre and States.
→ Feature:
 All decisions in GST Council to be taken by 3/4 th . It will function under chairmanship of Union Finance
Minister and have ministers nominated by States and UTs as members . Compensation to States for
entire amount of revenue losses for 5 years. It will act as benchmark and will guide States and GOI on
issues like tax rates, exemption lists, threshold limits etc. Cent re will have weightage of 1/3 rd of total
votes cast and combined all States 2/3 rd . Each State, big or small, will have equal vote.
→ Function:
 Under Article 279A, GST Council makes recommendations to Union and States on important issues
related to GST, like goods and services that may be subjected or exempted from GST, model GST Laws.

Page 254 of 719

 GST Council also decides on various rate slabs of GST. GST council calls on rates , exemption lists,
threshold limits.
→ Significance:
 In 2022, FM Sitharaman said GST Council was one fledgling 5-year-old institution that had yet to
become well-settled, but acted as one vibrant forum for intense interactions between Centre and
States.
 Goods and Services Tax (GST) Appellate Tribunal (GSTAT) :
→ What:
 2 nd appeal forum under GST for any dissatisfactory order passed by 1 st Appellate Authorities. It holds
same powers as court and is deemed as Civil Court for trying cases. GST Act mandates constitution of
Tribunal. National Appellate Tribunal (NAT) is 1 st common forum to resolve disputes between centre
and States.
→ Structure:
 National Bench: National Appellate Tribunal (NAT) is situated in New Delhi. Regional Benches: On
recommendations of GST Council, government can constitute Regional Benches. As of now, there are
3 Regional Benches (Mumbai, Kolkata, Hyderabad) in India. State Bench. Area Bench.
 Input Tax Credit (ITC):
→ What:
 tax paid during purchase (input) by manufacturer and that which can be used to reduce his tax liability
when he sells.
 Explanation: when manufacturer pays tax on his output, he can deduct tax already paid on input he purchased.
That is, while paying tax on his output, he can deduct or take credit for tax he paid while purchasing inputs. In
simple terms, it means that at time of paying tax on output, one can reduce tax one has already paid on inputs
and thus pay only balance amount.
→ Exceptions:
 Business under composition scheme cannot avail input tax credit. ITC cannot be c laimed for personal
use or for goods that are exempted.
→ Concerns:
 possibility of misuse by generating fake invoices just to claim ITC. Max. of total GST liability is settled
by ITC and remaining is deposited as cash. Currently, no provision for real time ( time gap) matching of
ITC claims and taxes already paid by suppliers of inputs. Hence, possibility of ITC being claimed on
basis of fake invoices.
 Composition Scheme:
→ What:
 alternative method of tax levy under GST designed to simplify compliance and reduce compliance costs
for small taxpayers. It grants relief to MSMEs on GST filings, procedures and tax rates. simple and easy
scheme under GST for taxpayers. Small taxpayers can get rid of tedious GST formalities and pay GST
at fixed rate of turnover.
→ Aim:
 Attempt to make GST - Good and Simple Tax.
→ Feature:
 business or person who opted to pay tax under this scheme can pay tax at flat % of turnover every
quarter, instead of paying tax at normal rate every month.
→ Eligibility:
 Manufacturers, Traders, service provider.
→ Not eligible:
 Businesses with inter-State supplies. manufacturers of ice cream, pan masala and tobacco. e -
commerce players.
→ Drawback:
 taxpayer cannot be involved in inter-State transactions, imports or exports. buyer transacting with
seller registered under composition scheme will not get benefit of input tax credit (ITC), which impacts
former’s sales.
→ Significance:
 There exists many MSMEs in India that created million jobs and contributed about 30% of India’s
economic output [National Sample Survey (NSS)]. GST Composition scheme acknowledges importance
of MSME sector. Under composition scheme, taxpayer can skip monthly returns and furnish only one
return on quarterly basis.
 Issues:
→ Deciding Revenue Neutral Rate (RNR): Revenue neutral rate is one which does not lead to fall in tax revenues. It is
also to be ensured that rates are not fixed too high as to lead to inflation. In report by Arvind Subhramaniam, he
suggested creating 3 bands with RNR of 16%. Deciding exemption limit below which traders will not come under GST

Page 255 of 719

 regime. Readying IT infrastructure for administration of GST. Devising effective mechanism to deal with dual policing
by Centre and State to administer and implement GST.
→ Faceless tax regime for direct taxes i.e. E-assessment Scheme, 2019 has resulted in significant benefits in case of
direct tax regime. However the main drawback of GST is that it remains face-to-face which is leading to the same old
issue of corruption. So, while the faceless tax regime in the Income Tax Department has completely removed
corruption from the system, corruption in the case of indirect taxes persists with GST.
 Significance:
→ GST encapsulates dictum – “One nation, one indirect tax”. It will make India one unified common market.
→ GST brought an end to the era when traders and businessmen had to pay a host of different indirect taxes — excise
duty, VAT, sales tax, service tax, octroi — at the same time.
 Achievement of GST:
→ GST was introduced with the motive of “one nation one tax”. Earlier traders and businessmen had to pay various
indirect taxes — excise duty, VAT, sales tax, service tax, octroi — and were subjected to harassment, corruption and
clearance issues at various tax departments. After its introduction, GST has resulted in more efficiency and has also
reduced the time taken to transport goods. Monthly GST collections are hitting new highs and stood at Rs. 1.47 lakh
crore in September 2022, after hitting an all-time high of Rs. 1.68 lakh crore in April 2022. Tax evasion has also
reduced significantly.
 Fact:
→ States would receive -> SGST (State GST) component of GST + share of IGST (integrated GST).
 Way Forward:
→ Some expert feel that some rationalisation of GST rates is needed. Also, there needs to be equitable
treatment for various professions.
Evidence: While there is an 18% GST on the fee charged by chartered accountants, there is no GST on
fees of advocates and solicitors. If the 18% tax rate for manufacturers and traders is reasonable, as they
were earlier subject to multiple taxes, then some expert feel that the 18% tax rate for professionals is high.
Note:
 Document Identification Number (DIN) under GST:
→ What:
 It is one 20-digit unique number generated digitally in alphanumeric code. Central Board of Indirect Taxes and
Customs (CBIC) came up with this initiative to secure all communication sent by tax officials to registered
taxpayers by digitising communication. One unique document identification number will be used on all
communications sent to taxpayers.
→ DIN structure:
 Structure of DIN is “CBIC-YYYY MM ZCDR NNNN” wherein; YYYY denotes year of generation of DIN, MM denotes
month of generation of DIN, ZCDR denotes Zone Commissionerate Division Range Code, NNNN denotes
alphanumeric randomly generated code.
→ Status:
 GOI made quoting of DIN mandatory on all search authorisation, summons, arrest memos, inspection notices
and other letters issued during course of enquiry. DIN can be generated from government website
(www.cbecddm.gov.in) and can be done only from login of empowered Officer.
 Kerala, Karnataka have already implemented it.
→ Significance:
 Transparency in all communications with tax department avoiding receipt of fake notices, and easy identification
of such fake notices. Creation of proper audit trail of all communications sent by tax department. Protect rights
of taxpayers. Accountability. DIN would prevent any abuse by departmental officers of pre-dating
communications and ratifying actions by authorisations subsequently made out in files.
 Input:
→ materials or services purchased by manufacturer in order to manufacture his product or services (output).
 Tax credit:
→ tax producer was able to reduce while paying his tax on output.
 Inverted duty structure:
→ taxes on output / final product is lower than taxes on input
Question:
 GST is unlikely to ‘drastically’ reduce CAD because of crude oil import and OPEC cartel that manipulates its prices. GST is
unlikely to enormously increase size of our economy. We can’t overtake China in near future, because it’ll require
currency undervaluation and labour exploitation.
Mains Link:
 Discuss the significance of Input tax credit.
 Discuss the need for GST Compensation Cess.
 Explain the rationale behind the Goods and Services Tax(Compensation to states)act of 2017.How has COVID-19 impacted
the GST compensation fund and created new federal tensions?(UPSC 2020)

Page 256 of 719

 MINIMUM SUPPORT PRICE (MSP)
News:
 2021:
→ Indian Sugar Mills’ Association (ISMA) asks government to raise minimum price (Minimum Selling Price) for sugar.
→ Centre hikes MSP for: common paddy, pulses, oilseeds, coarse cereals.
→ Union government increases minimum price [Fair and Remunerative Price (FRP)] that sugar mills must pay to sugar
cane farmers. But, despite demands from sugar mills, centre refused to hike minimum price (Minimum Selling Price)
at which sugar mills can sell processed sugar, on ground of consumer interests.
→ CCEA approves increase in MSP for all mandated Rabi crops for Rabi Marketing Season 2022-23.
→ Farmers are demanding law for guaranteed MSP.
→ One BJP private member introduces - Farmers Right to Guaranteed Minimum Support Price Realization of Agri-
Produce Bill, 2021.
 2022:
→ Maharashtra government issues resolution which will allow sugar mills to pay basic fair and remunerative price (FRP)
in two tranches. [Sugar mill owners have welcomed this move but farmers are not happy with it].
 Arguments of farmers:
• Farmers argue that this method would impact their incomes. They point out that while FRP will be paid in
installments, their bank loans and other expenses are expected to be paid for as usual.
• Farmers mostly require lumpsum at beginning of season (October-November), because their next crop cycle
depends on it.
→ Based on recommendations of Commission for Agricultural Costs and Prices (CACP), Cabinet Committee on Economic
Affairs (CCEA) approves MSP for Raw Jute for 2022-23 season. [Announced MSP of raw jute is in line with principle
of fixing MSP of at least 1.5 times all India weighted average cost of production as announced by Government in
Budget 2018-19. It assures minimum of 50% margin of profit. It is one of important and progressive steps towards
ensuring better remunerative returns to jute growers and to incentivize quality jute fibre].
→ MSP for Kharif season 2022-23 approved by Cabinet. Rates for 14 Kharif crops are increased, hikes ranging from 4%
to 8%.
→ GOI finally constitutes one committee headed by former Union Agriculture Secretary Sanjay Agrawal to look into
issues of MSP, as promised to Samyukt Kisan Morcha (SKM) earlier. This Sanjay Agrawal committee [2022] will also
look into issues of natural farming.
 Background: GOI had announced decision to repeal 3 farm laws and said it will constitute committee to promote
Zero budget-based farming, change crop patterns keeping in mind changing needs of India and make MSP more
effective and transparent.
 Note: Protesting farmers have been demanding MSP based on C2, besides legal guarantee.
→ One SBI study released in 2022 says average income of farmers grew only by 1.3 -1.7 times during 2017-18
and 2021-22. Kisan Credit card and MSP have been instrumental in benefiting farmers. SHG have around
10% NPA across India.
→ India demands WTO to find permanent solution to issue of Public Stockholding (PSH) of food.
 Background: India’s MSP policy for procurement of produce (for supporting farmers’ income as well as providing
subsidized food for poor) had fallen out of WTO rules. Under WTO law, such price support-based procurement
from farmers is considered trade-distorting subsidy. Currently, India has temporary relief due to one ‘peace
clause’ that bars countries from raising legal challenges against these subsidies. WTO’s peace clause (inserted in
Bali Ministerial, 2013) protects India’s food procurement programmes against action from WTO members in case
subsidy ceilings are breached.
→ Centre raises fair prices / Fair and Remunerative Price (FRP) for sugarcane harvest.
About:
 What:
→ Fixed price assured by Government to farmers for their produce. rate at which government buys grains from farmers.
At beginning of sowing season, Cabinet Committee on Economic Affairs (CCEA), chaired by PM, announces MSP for
various crops based on recommendations of Commission for Agricultural Costs &Prices (CACP), Min. of Agriculture.
calculated based on at least 1.5 times cost of production incurred by farmers. MSP is fixed twice in 1 year. Currently,
MSPs are given for crops grown in Kharif, Rabi seasons and also given to some commercial crops.
MSP is “minimum price” for any crop that government considers as remunerative for farmers and hence
deserving of “support”.
 MSP regime in India:
→ Evolution:
 1960s: Food scarcity, importing PL-480 grains from USA. MSP introduced, as floor price, to incentivize farmers
to use riskier HYV in belt of Punjab, Haryana, western UP. It paved way for Green Revolution by increasing
production of wheat and paddy.
→ Status:
 Government extends price support for paddy, wheat through FCI and State Agencies. Under MSP policy,
whatever food grains are offered by farmers within stipulated period & conforming to specifications prescribed
Page 257 of 719
 by Government are purchased at MSP by State Government agencies including FCI for Central Pool. Additionally,
Oilseeds, pulses, copra of Fair Average Quality (FAQ) are procured from registered farmers under price support
scheme of umbrella scheme of Pradhan Mantri Annadata Aay SanraksHan Abhiyan (PM-AASHA). CACP
recommends MSPs for 22 mandated crops currently and FRP for sugarcane.
 Need:
→ Support farmers from distress sales; To procure food grains for public distribution; To safeguard farmers from market
price fluctuations; Maintain healthy supply of food grains in market thereby helping in fight against hunger;
Guaranteed price for crops and assured markets encourage higher investment and adoption of modern farming
practices.
 Calculation of MSP:
→ Pre 2018-19 Budget:
 Factors considered by CACP:
• Cost of production / cultivation; Demand and supply; market price trend - domestic and international; Inter-
crop price parity; Inflation; environment – soil, water; Terms of Trade between agriculture and non-
agriculture.
→ Post 2018-19 Budget (Current):
 Pre-determined principle / formula:
• MSP shall be fixed at atleast 1.5 times of crop’s production cost incurred by farmers.
• CACP considers both A2 + FL cost and C2 for recommending MSP. That is, CACP estimates production costs
and recommends MSPs to CCEA by applying 1.5-times formula. But, CACP considers only A2+FL cost and C2
costs are used by CACP primarily as benchmark reference costs (opportunity costs) to see if MSPs
recommended by CACP at least cover these costs in some of major producing States. [These A2, A2 + FL, C2
are based on Swaminathan Committee recommendations].
 Limitation:
→ Not all crops:
 Major problem with MSP - lack of government machinery for procurement for all crops except rice, wheat. [Food
Corporation of India (FCI) actively procures rice and wheat under PDS].
→ Regional disparity:
 Last mile grain is procured by State governments.
 So, farmers of States where grain is procured completely by State government is benefited more than farmers
in those States where procurement is less.
→ MSP-based procurement system is dependent on middlemen, commission agents, APMC officials. Thus, smaller
farmers find difficult to get access to them.
 MSP legalization:
→
{Arguments in favour of legalization} {Arguments against legalization}
Farmers receive < MSP: Statutory MSP is unsustainable:
a. In most crops grown across much of India, a. NITI Aayog argued against legalising MSP. NITI
prices received by farmers, especially during said that any fixed pre-determined price will
harvest time, are well below officially- push away private traders whenever
declared MSPs. production is more than demand and price
b. Since MSPs have no statutory backing, farmers slump in market. This, will lead to government
cannot demand MSP as matter of right. de-facto becoming primary buyer of most farm
produce for which MSP is declared, which is
unsustainable.
Limited procurement by Govt: Corruption, leakage:
a. Actual procurement at MSP by Govt. is a. Huge scope for corruption, leakage of wheat,
confined to only about 1/3rd of wheat and rice rice from godowns, ration shops, or in transit.
crops (of which ½ is bought in Punjab, Haryana
alone), 10-20% of select pulses & oilseeds.
b. According to 2015 Shanta Kumar Committee
report, only about 5% of farm households sell
wheat, rice to government at MSP rates
Disposal problems:
a. While cereals, pulses can be sold through PDS,
disposal becomes complicated in case of niger
seed, sesamum, safflower
Inflation:
a. Higher procurement cost would mean increase
in prices of foodgrains, leading to inflation,
eventually affecting poor.
Impact on India’s farm exports:
Page 258 of 719
 a. It will also impact India’s farm exports, if MSP
is higher than prevailing rates in international
market.
b. Farm exports is about 10% of total exports of
commodities.
Opposition at WTO:
a. With legally guaranteed higher MSP, India will
face stiff opposition at WTO.
b. In 2019, USA successfully won case against
China at WTO which was concerned with
China’s domestic support to agriculture in form
of Market Price Support (MPS)
Burden on exchequer:
a. It would lead to huge burden on
exchequer, since government would have to
procure all marketable surplus in absence of
private participation.
Demands from other sectors:
a. If Centre makes law to guarantee 100%
procurement in crops, , farmers cultivating
fruits, vegetables, spices, other crops will also
demand same.
 MSP vs WTO:
→ India’s MSP policy for procurement of produce (for supporting farmers’ income as well as providing subsidized food
for poor) had fallen out of WTO rules. Under WTO law, such price support-based procurement from farmers is
considered trade-distorting subsidy. Currently, India has temporary relief due to one ‘peace clause’ that bars
countries from raising legal challenges against these subsidies. WTO’s peace clause (inserted in Bali Ministerial, 2013)
protects India’s food procurement programmes against action from WTO members in case subsidy ceilings are
breached.
 Initiative:
→ In 2022, GOI constituted Sanjay Agrawal committee [2022] to look into issues of MSP, natural farming.
 Significance:
→ Price stability.
→ Reduces impact of price rise in short supply and price fall in bumper harvest.
→ farmers get minimum price in bumper harvest.
→ May be used by Govt. as incentives to farmers to grow crops that are in short supply.
→ One 2016 NITI Aayog study report - “Evaluation Study on Efficacy of Minimum Support Prices (MSP) on Farmers” -
found that MSP declared by Government encouraged 78% of farmers covered under study for adopting improved
methods of farming such as high yielding varieties of seeds, organic manure, chemical fertilizer, pesticides, improved
methods of harvesting etc.
Note:
 Public Stockholding (PSH) of Food:
→ What:
 PSH of food is one policy tool used by governments to procure, stockpile and distribute food when needed. Ex:
MSP scheme.
→ Export of PSH food grains:
 WTO law prohibits countries from exporting foodgrain procured at subsidised prices. However, recent food crisis
due to 2022 Russia-Ukraine War has led to India insisting that it should also be allowed to export food, especially
wheat, from pool of foodgrain procured under MSP.
→ Way Forward:
 Permanent solution for PSH: India demanded in WTO permanent solution to PSH policy. However, no mention
of such solution was made in recently concluded WTO Geneva declaration (2022).
 Production cost:
→ A2 cost:
 All paid-out costs directly incurred by farmer on seeds, fertilisers, pesticides, hired labour, leased land, fuel,
irrigation, etc. A2 is actual paid-out cost incurred by farmer.
→ A2 + FL cost:
 A2 cost + Family Labour. A2+FL is actual paid-out cost plus value of family labour.
→ C2 cost:
 more comprehensive cost. A2 + FL + rentals and interest forgone on owned land, fixed capital assets. C2 includes
A2+FL + Rental value of own land.
 Fair and Remunerative Price (FRP):
Page 259 of 719
 → What:
 minimum price [Statutory Minimum Price (SMP)] at which sugarcane is to be purchased by sugar mills from
sugarcane farmers. FRP is basically MSP for sugarcane. Other crops have MSP but for sugarcane, govt. came up
with FRP. FRP is fixed by govt. but paid by sugar mills to sugarcane farmers. Reason is, because of weight-losing
property of sugarcane, sugarcane must reach sugar mills within stipulated time period. So, govt. procurement
via MSP would not be viable solution in case of sugarcane. Hence, MSP was replaced by FRP in case of sugarcane.
FRP is price declared by government, which mills are legally bound to pay to farmers for cane procured from
them.
→ Feature:
 Central government (CCEA, chaired by PM) announces FRP, determined on recommendation of CACP.
 FRP is based on recovery of sugar from sugarcane. Sugar recovery is ratio between sugar produced versus cane
crushed, expressed as %. Higher sugar recovery, higher is FRP, and higher is sugar produced.
 FRP is based on 2012 Rangarajan Committee report on sugarcane industry.
 payment of FRP across India is governed by Sugarcane Control order, 1966, issued under Essential Commodities
Act, 1955, which mandates payment within 14 days of date of delivery of cane.
 FRP is fixed by central govt. but paid by sugar mills to sugarcane farmers.
 Delays in payment (mills to farmers) can attract interest up to 15% per annum, and sugar commissioner can
recover unpaid FRP as dues in revenue recovery by attaching properties of mills.
→ Significance:
 Assured payment is one of major reasons why cane is popular crop with farmers.
 Delays in payment can attract interest up to 15% per annum, and sugar commissioner can recover unpaid FRP
as dues in revenue recovery by attaching properties of sugar mills.
 State Advised Prices (SAP):
→ Sugarcane price announced by State government, over and above FRP.
→ Since sugar pricing comes under concurrent list, Supreme Court held that both centre and States have power to fix
sugarcane prices.
→ While centre’s price is minimum price, States can set SAP that will always be higher than centre’s FRP.
 Commission for Agricultural Costs and Prices (CACP) [1965]:
→ What:
 decentralised agency of Government of India. statutory body attached to Ministry of Agriculture & Farmers
Welfare, Government of India. It is advisory body whose recommendations are not binding on Government.
→ Aim:
 To recommend MSPs; To motivate cultivators and farmers to adopt latest technology in order to optimise use
of resources and increase productivity.
→ Function:
 submits reports recommending prices for kharif and rabi seasons.
 Farmers Right to Guaranteed Minimum Support Price Realization of Agri-Produce Bill, 2021:
→ Highlight:
 It seeks to legally guarantee MSP.
 Farmer realising price < declared MSP shall be entitled to compensation equal to difference in value between
price realised and guaranteed MSP.
 It proposes that payments should be made directly into accounts of farmers.
→ Significance:
 Ddeclaration of guaranteed MSP to farmers shall result in improved farm realization, thereby leading to
resurgence in rural economy.
 MSP vs Fair and Remunerative Price (FRP):
→
{MSP} {FRP}
{Definition} Minimum price for any crop that Minimum price at which sugarcane
government considers as is to be purchased by sugar mills
remunerative for farmers and hence from farmers.
deserving of support.
It is also price that government
agencies pay whenever they
procure that particular crop.
{Recommendation} Recommended by CACP Recommended by CACP
{Mandated Crops} Mandated crops include many crops Mandated crop is sugarcane.
of kharif season, rabi crops, other
commercial crops. Example –
Cereals, Paddy, wheat, barley,

Page 260 of 719

 jowar, bajra, maize, ragi, pulses,
Oilseeds, Raw cotton, Raw jute, etc.
{Factors Considered} a. Supply and demand a. Cost of production of
situation for commodity. sugarcane;
b. Market price trends b. Return to sugarcane
(domestic and global) and growers from alternative
parity with other crops. crops and general trend of
c. Implications for consumers prices of agricultural
(inflation). commodities;
d. Environment (soil and c. Availability of sugar to
water use). consumers at fair price;
e. Terms of trade between d. Price at which sugar
agriculture and non- produced from sugarcane
agriculture sectors. is sold by sugar producers;
e. Recovery of sugar from
sugarcane;
f. Realization made from sale
of by-products namely
molasses, bagasse, press
mud;
g. Reasonable margins for
growers of sugarcane on
account of risk and profits.
{Legal Backing} MSP is obligatory, not statutory Pricing of sugarcane is governed by
exercise.Currently, there is no statutory provisions of Sugarcane
statutory backing for MSP or any (Control) Order, 1966 issued under
law mandating its implementation. Essential Commodities Act, 1955.

{Rabi Crop} {Kharif Crop}
In Arabic, Rabi means “Spring Season”. In Arabic, Kharif means “Autumn season”.
Rabi crops are also known as winter crops, Rabi harvest or Kharif crops are also known as monsoon crops, Kharif
spring crops. harvest or autumn crops.
There are cultivated during winter season from These are cultivated in rainy or monsoon season i.e. from
September to April. April to October.
Rabi seeds are sown during slightly warmer months, Kharif seeds are sown in beginning of monsoon that is
which are September-October, starting of winters; this is during April-May.
best time for seed germination.
Growth of crops however requires pretty cold conditions. Growth of Kharif crops requires hot and humid weather.
Flowering of Rabi crops requires longer days. Flowering of Kharif crops requireds longer nights.
Harvest is done at end of winters or at starting of spring Harvest is done at end of monsoon or at starting of winter
season i.e. March-April. season i.e. September-October.
Winter is dry in India and so Rabi crops require timely Kharif crops require rain water and depend on rain
irrigation, although little and controlled. pattern for growth.
Examples of Rabi crops are: wheat, potato, gram, green Examples of Kharif crops are: rice, bajra, maize, cotton,
peas, oats, barley, etc. jowar, sorghum, soybean, jute, groundnut, etc.
Examples of seed rabi crops are: sunflower, linseed,
mustard, coriander, cumin, etc.
 Sanjay Agrawal committee [2022]:
→ What:
 Committee constituted by GOI in 2022 to look into issues of MSP, natural farming.
→ Background:
 GOI had announced decision to repeal 3 farm laws and said it would constitute committee to promote Zero
budget-based farming, change crop patterns keeping in mind changing needs of India and make MSP more
effective and transparent.
→ Objective:
 On agricultural marketing system: It will work for Agri marketing as per changing requirements of India to ensure
higher value to farmers through remunerative prices of their produce by taking advantage of domestic output
and export.
 On natural farming: It will suggest programmes and schemes for value chain development, protocol validation
and research for future needs and support for area expansion under Indian Natural Farming System.
 On crop diversification: It will look into mapping of existing cropping patterns of agro-ecological zones of
producer and consumer States.
Page 261 of 719
  Review and suggestion on micro irrigation scheme.
→ Composition:
 It will consist of representatives of Central and State governments, farmers, agricultural scientists, agricultural
economists.
→ Mandate:
 To look into providing legal guarantee for MSP for agricultural produce.
 To strengthen agricultural marketing system to ensure higher value to farmers through remunerative prices of
their produce by taking advantage of domestic and export opportunities.
 To look into issues of Zero budget-based farming and changing crop patterns keeping in mind changing needs of
India.
 To suggest farmer friendly alternative certification system and marketing system for natural farming processes
and products.
 It will also map existing cropping patterns of agro-ecological zones of producer and consumer States and develop
strategy for diversification policy to change cropping pattern.
Value Addition:
 Extra Neutral Alcohol (ENA):
→ What:
 byproduct of sugar industry.
 formed from molasses that are residue of sugarcane processing.
 primary raw material for making alcoholic beverages.
→ Features:
 Colourless
 food-grade alcohol that does not have any impurities.
 neutral smell and taste
 typically contains about 95% alcohol by volume.
→ Applications:
 Essential ingredient in manufacture of cosmetics, personal care products - perfumes, toiletries, hair spray etc.
 production of paints, ink for printing industry
 production of fresheners, detergents.
 pharmaceutical products - antiseptics, drugs, syrups, medicated sprays.
 ENA is main raw material used in production of alcoholic drinks (whiskey, vodka)
 Silvopasture:
→ Literal meaning is forest used for grazing.
→ practice of integrating trees, forage (plant material eaten by grazing livestock), grazing of domesticated animals in
mutually beneficial way.
→ i.e. it integrates trees, forage, livestock.
→ based on principles of managed grazing
→ among distinct forms of agroforestry.
 Agroforestry:
→ practice of agriculture and forestry on same piece of land
→ land use management system in which trees or shrubs are grown around or among crops or pastureland. Intentional
combination of agriculture and forestry. This diversification of farming system initiates agroecological succession,
like that in natural ecosystems, and so starts chain of events that enhance functionality and sustainability of farming
system. Trees also produce wide range of useful and marketable products from fruits / nuts, medicines, wood
products, etc.
→ Benefits:
 greatly enhanced yields from staple food crops; enhanced farmer livelihoods from income generation; increased
biodiversity; improved soil structure and health; reduced erosion; carbon sequestration (storing carbon in
carbon pool).
→ Example:
 Agroforestry are highly beneficial in tropics, especially in subsistence smallholdings in sub-Saharan Africa.
 Also, it has been found to be beneficial in USA, Europe.
Question:
 In case of all cereals, pulses and oil seeds, procurement at MSP is limited in any State / UT of India because buffer stock
is limited. MSP has no link with market price.
Mains Link:
 Tracing the evolution of the Minimum Support Price regime in India, discuss how MSP has caused – Concentration
of markets, Negative externalities, and High transaction costs. What steps can be taken to address these to e nsure
better remuneration to farmers and stimulate the rural economy? (15M)

MINES AND MINERALS / MINING

Page 262 of 719
News:
 2021:
→ Li deposits found in Karnataka.
→ Parliament passes Mines and Minerals (Development and Regulation) Amendment Act, 2021.
→ QUAD tightens rare-earth minerals cooperation to counter China.
→ US, some countries reduce import dependency on China for rare earth minerals.
→ Chinese companies begin on-site inspections of possible projects to tap lithium deposits in Afghanistan.
[received green light from Taliban regime].
 2022:
→ Serbians are protesting on streets against Rio Tinto’s (Anglo -Australian multinational company that is
world's 2 nd -largest metals and mining corporation) plans to mine lithium in Jadar valley near Lozinca town
in Serbia.
 Reason: Serbia is already ridden with industrial pollution. This new mine would only make it worse, polluting
land, water in area. Serbia is Europe’s 5th and world’s 32nd most polluted country. Serbia is one of top 10 countries
with most deaths due to pollution.
→ With EV industry growing rapidly, demand for lithium, essential resource for EV battery makers, is
increasing.
→ One killed, another injured, when coal mine collapsed in Meghalaya’s Shallang area in West Khasi Hills district.
→ High-grade lithium discovered in Nigeria.
→ Union Cabinet approves amendments to Mines and Minerals (Development and Regulation) Act, 1957 for specifying
rate of royalty in respect of Glauconite, Potash, Emerald, Platinum Group of Metals (PGM), Andalusite, Sillimanite,
Molybdenum.
→ Coal India Ltd (CIL) is exploring green mining options to lessen any adverse environmental impact by leveraging
ecofriendly technologies in both underground and open cast mining. Some of these technologies include: mining
from tailings, dust suppression techniques, liquid membrane emulsion technology, sulphuric acid leaching extraction
process, impermeable tailings storage.
→ Kerala government opposed new set of proposed amendments to MMDR Act. Kerala State asks Centre not to allow
corporate entry into atomic minerals sector. Kerala says Amendments are breach of States Rights as minerals come
under purview of States. [Under List II, State Governments are owners of mines and minerals located within territory
of State concerned, and under Article 246, State Assemblies can make laws on such minerals].
→ USA announces formation of one global alliance called Minerals Security Partnership (MSP) to reduce dependency
on China. India is not part of MSP.
→ In massive boost to its efforts to secure critical mineral supplies, India has been approached by several African
countries with offers to service part of their development loans by giving access to Indian companies in their mining
operations and allowing exports of highly prized lithium and cobalt. [GOI asked domestic metal and mining
companies to place their interest in raw materials and other minerals that they require for manufacturing so that
these could be sourced from countries where Indian lines of credit have been extended.].
→ A report of a joint committee, formed on orders of NGT to ascertain the extent of illegal mining in Aravalli
region of Haryana, finds instances of mining activity at several locations in the region despite prohibitory
orders. It has also found trenches at some sites due to excavation. [Mining in Aravalli region was banned
by Supreme court in 2009 to restore the ecological value of Aravalli hills].
→ Meghalaya High Court directs Meghalaya State government to ensure “not an ounce of illegally-mined coal” is
allowed to be transported in trucks or other vehicles. The court told Meghalaya’s Chief Secretary and Director-
General of Police that they would be accountable if any form of illegally-mined coal is discovered being transported
in the State. [NGT since 2014 and Supreme Court since 2016 ban orders have been in place].
Constitution:
 Article 246 (Subject-matter of laws made by Parliament and by Legislatures of States):
→ (3) Subject to clauses (1) and (2), State Legislature has exclusive power to make laws for such State with respect to
any of matters enumerated in List II in 7th Schedule (State List).
About:
 Mining:
→ What:
 Extraction of valuable minerals or other geological materials from Earth, usually from ore body, lode, vein, seam,
reef, or placer deposit.
→ Type:
 For calculating value of output, mining and quarrying sector is divided into 2 broad groups viz.: Major Minerals
and Minor Minerals.
→ Green Mining:
 What:

Page 263 of 719

 • Green Mining concept was developed as one major tool to make Finland forerunner in sustainable mining.
It promotes material, water, and energy efficiency to reduce environmental footprint of mineral-based
product life cycles. Green Mining allows recovery of all useful minerals and minimises mining waste.
 Goal:
• To lessen any adverse environmental impact
 How:
• By leveraging ecofriendly technologies.
 Green Mining techniques in coal mining:
• Mining from tailings, dust suppression techniques, liquid membrane emulsion technology, sulphuric acid
leaching extraction process, impermeable tailings storage.
→ Rat-Hole Coal Mining:
 What:
• Rat-hole mining is dangerous technique involving digging narrow vertical tunnels into earth to extract coal.
Since most of these tunnels are dug without following guidelines, they pose threat to workers. Rathole
mining involves digging of very small tunnels, usually only 3-4 feet high, where workers (often children)
enter and extract mineral say coal.
 Law:
• NGT had banned Rat-hole mining in 2014, but Supreme Court in 2019 over-ruled that mining done under
proper rules and provisions of Mines and Mineral Act, 1957 will be legal.
 Meghalaya:
• Rat-hole mining is common in Meghalaya due to thinness of coal found.
→ Open-pit mining / Open-cast / Open-cut mining:
 In larger contexts, it is also called mega-mining. Open-pit mining is a surface mining technique of extracting rock
or minerals from the earth from an open-air pit, sometimes known as a borrow.
This form of mining differs from extractive methods that require tunnelling into the earth, such as long
wall mining. Open-pit mines are used when deposits of commercially useful ore or rocks are found near the
surface. It is applied to ore or rocks found at the surface because the overburden is relatively thin or the material
of interest is structurally unsuitable for tunnelling (as would be the case for cinder, sand, gravel).
In contrast, minerals that have been found underground but are difficult to retrieve due to hard rock,
can be reached using a form of underground mining.
→ Coal mining in North-East India:
 Meghalaya:
• 6th schedule: Meghalaya is a tribal State where the 6th Schedule applies. Thus, all land is privately owned,
and hence coal mining is done by private parties. [6th schedule does not explicitly refer to mining].
• Coal deposits: The sizable coal deposits in Meghalaya, mostly in the Jaintia Hills, occur in horizontal seams
only a few feet high that run through the Jaintia hills which is why rat-hole mining is practised instead of
open cast mining.
• Cheaper labour: Most of the labour (including children) comes from Nepal, the poorer areas of Assam, and
Bangladesh.
• Coal mining ban in Meghalaya by NGT, Supreme Court:
 River pollution: Rathole mining has poisoned 3 rivers in the Jaintia hills: the Myntdu R., Lunar R. and
Lukha R.
 Water pollution: Acid mine drainage from abandoned mines was a major cause for water pollution.
 Child Labour and Trafficking: Majority of the workers involved in ‘rat-hole’ mining are children because
of their small anatomy that fits small mine tunnels.
 Health concerns cause various diseases like fibrosis, pneumoconiosis and silicosis in workers as well as
locals.
 Environmental concerns: Loss of biodiversity and agricultural farmlands.
 Constitutional:
→ Union List / List I:
 Regulation of mines and mineral development to extent to which such regulation and development under
control of Union is declared by Parliament by law to be expedient in public interest.
→ State List / List II:
 Regulation of mines and mineral development subject to List I with respect to regulation and development under
control of Union.
→ Under above Union List entry, Central government owns minerals within exclusive economic zone of India (EEZ).
Central government has ownership over all offshore minerals (ie. minerals extracted from sea or ocean floor in Indian
maritime zones like territorial waters, continental shelf, exclusive economic zones). Under above State List entry,
State government owns minerals located within their boundaries.
 Major Mineral:
→ Example:

Page 264 of 719

  Major minerals cover fuel minerals consisting of coal, lignite, petroleum and natural gas, other major
minerals i.e. metallic minerals including atomic minerals, non -metallic minerals, etc.
 Minor Mineral:
→ What:
 Mines and Minerals (Development and Regulation) Act, 1957 defines minor minerals as building
stones, gravel, ordinary clay, ordinary sand other than sand used for prescribed purposes, and any
other mineral which Central Government may, by notification in Official Gazette, declare to be minor
mineral.
→ Example:
 sand, gravel.
→ Status:
 Demand for minor minerals such as sand, gravel has crossed 60 million metric tons in India.
 While laws and monitoring have been made stringent for mining of major minerals consequent to
unearthing of several related scams across India, rampant and illegal mining of minor minerals
continues unabated.
 UNEP, in 2019, ranked India, China as top 2 countries where illegal sand mining has led to sweeping
environmental degradation.
→ Issue:
 India has grossly underestimated issue of illegal mining, which damages environment and causes
revenue loss.
 With increase in pace of development, demand for minor minerals such as sand, gravel has crossed 60
million metric tons in India. Example, there have been numerous cases of illegal mining of dolomite,
marble, sand across States in India. In Andhra Pradesh’s Konanki limestone quarries alone, 28.92 lakh
metric tonnes of limestone have been illegally quarried.
 Regulation issue:
• Under different State laws: Unlike major minerals, regulatory and administrative powers to frame
rules, prescribe rates of royalty, mineral concessions, enforcement, etc. are entrusted exclusively
to State governments.
• Loss to State exchequer: As per estimate, UP is losing revenue from 70% of mining activities as
only 30% area is legally mined.
• Issue with EIA: EIA was amended in 2016 which made environmental clearance mandatory for
mining in areas < 5 hectares, including minor minerals. This 2016 amendment also provided for
setting up of one District Environment Impact Assessment Authority (EIAA) and one District Expert
Appraisal Committee (EAC). However, State-wise review of EACs and EIAAs in key industrial States
such as Gujarat, UP, Karnataka, Tamil Nadu, shows that these authorities review over 50 project
proposals in single day and rejection rate at State level has been mere 1%.
 Mining Minor mineral is 2 nd largest extractive industry on planet, after water.
 Environmental issues: In Yamuna riverbed in UP, increasing demand for soil ha s severely affected soil
formation and soil holding ability of land, leading to loss in marine life, increase in flood frequency,
droughts, and also degradation of water quality. Such effects can also be seen in beds of Godavari,
Narmada, Mahanadi basins. In Narmada basin, sand mining has reduced population of Mahseer fish
from 76% between 1963 and 2015.
→ Way Forward:
 Tapping technology to check minor mineral plunder . Protecting minor minerals requires investment in
production and consumption measurement and also monitoring and planning tools. To this end,
technology has to be used to provide sustainable solution e.g., Satellite imagery can be used to
monitor volume of extraction and also check mining process.
 Recently, NGT directed some States to use satellite imagery to monitor volume of sand extraction and
transportation from riverbeds. Additionally, drones, IoT, blockchain technology can be leveraged to
monitor mechanisms by using GPS, radar, Radio Frequency (RF) Locator.
 Critical Mineral:
→ What:
 Critical minerals are mineral resources that are essential to economy and whose supply may be
disrupted. 'Criticality' of mineral changes with time as supply and society's needs shift. Table salt, for
example, was once critical mineral. Today, many critica l minerals are metals that are central to high-
tech sectors. They include Rare Earth Elements (REE) and other metals such as lithium, indium,
tellurium, gallium, platinum, copper, nickel, cobalt elements, etc.
 Critical mineral is one metallic or non-metallic element that has 2 characteristics:
• It is essential for functioning of our modern technologies, economies or national security; and
• There is risk that its supply chains could be disrupted.

Page 265 of 719

 That is, critical mineral is one metallic or non-metallic element that is essential for modern technologies, economies
or national security, and has supply chain at risk of disruption.
 Critical minerals are elements that are building blocks of essential modern-day technologies, and are at risk of
supply chain disruptions. These minerals are now used everywhere from making mobile phones, computers to
batteries, electric vehicles and green technologies like solar panels and wind turbines.
→ Who decides list?
 Individual countries develop their own lists of critical minerals based on relative importance of particular
minerals to their industrial needs and strategic assessment of supply risks. Based on their individual needs and
strategic considerations, different countries create their own lists.
However, such lists mostly include graphite, lithium, cobalt, which are used for making EV batteries;
rare earths (REE) that are used for making magnets, and silicon which is key mineral for making computer chips
and solar panels. Aerospace, communications and defence industries also rely on several such minerals as they
are used in manufacturing fighter jets, drones, radio sets, other critical equipments.
→ Why do critical minerals matter?
 Critical minerals are essential for society. Demand for critical minerals such as REE has increased in
recent years with spread of high-tech devices for personal and commercial use such as wind turbines,
solar panels, electronics (smartphones, tablets). As countries around world scale up their transition
towards clean energy and digital economy, these critical resources are key to this ecosystem. Any
supply shock can severely hurt economy and strategic autonomy of country who depends on others to
procure critical minerals. But these supply risks exist due to rare availability, growing demand an d
complex processing value chain. Many times complex supply chain can be disrupted by hostile regimes,
or due to politically unstable regions.
→ Usage:
 Critical minerals are used to manufacture advanced technologies including mobile phones, computers,
fibre-optic cables, semi-conductors, banknotes, defence, aerospace and medical applications. Critical
minerals such as copper, lithium, nickel, cobalt, REE are essential components in many of today’s
rapidly growing clean energy technologies – wind turbines, electricity networks, electric vehicles.
Many critical minerals are used in low-emission technologies such as electric vehicles, wind turbines,
solar panels, rechargeable batteries. Some critical minerals are also crucial for common products such
as stainless steel, electronics.
→ Concern:
 Demand for Critical minerals will grow quickly as clean energy transitions gather pace. Limited
availability: US government said as world transitions to clean energy economy, global demand for
these critical minerals is set to skyrocket by 400-600 % over next decades, and, for minerals such as
lithium and graphite used in EV batteries, demand will increase by even more — as much as 4,000%.
REE are critical as world is fast shifting from fossil fuel -intensive to mineral-intensive energy system.
 China ‘threat’:
• China is world’s largest producer of 16 critical minerals. According to IEA, China is responsible for
some 70% and 60% of global production of cobalt and REE. China’s share of critical minerals
processing operations is even higher. China’s share of refining is around 35% for nickel, 50 -70%
for lithium, cobalt, and nearly 90% for REE. China also controls cobalt mines in Democratic Republic
of Congo, from where 70% of this mineral is sourced.
In 2010, China suspended REE exports to Japan for some months over one territorial dispute.
This decision made market prices of REEs jump anywhere between 60% to 350%. Prices returned
to normal only after 1 year of China resuming shipments.
→ Steps taken:
 In 2021, USA ordered review of vulnerabilities in its critical minerals supply chains and found that over -
reliance on foreign sources and adversarial nations for critical minerals and materials posed national and
economic security threats. Post supply chain assessment, USA has shifted its focus on expanding
domestic mining, production, processing, and recycling of critical minerals and materials. In 2019, India
set up Khanij Bidesh India Limited (KABIL), one joint venture of 3 public sector companies, to ensure
consistent supply of critical and strategic minerals to Indian domestic market, and also it would help in
realizing overall objective of import substitution. Australia and India (via KABIL) signed one MoU aimed
at ensuring reliable supply of critical minerals to India. In 2022, UK unveiled one Centre to study future
demand for and supply of these minerals. UK also said that UK’s critical mineral strategy will be unveiled.
In 2021, USA, Canada, Australia launched one interactive map of critical mineral deposits with aim to
help their governments to identify options to diversify their critical minerals sources.
→ Lithium (Li):
 What:
• also known as Miracle Element. Lithium is one chemical element with atomic number 3. It is one
soft, solid, silvery-white alkali metal.
 Characteristics / Properties:
Page 266 of 719
 • lightest metal, lightest solid element, lowest density of all metals. It reacts vigorously with water.
rare metal, alkali metal. highly reactive, flammable, explodes when exposed to air and water. It
must be stored in mineral oil. It has highest specific heat capacity of all solid element. good
conductor of electricity.
 Lithium mine:
• Lithium and most lithium minerals are mined along with other high -value metallic minerals such
as tin, niobium-tantalum (columbite-tantalite), and uranium (in pyrochlore). Greenbushes mine
(Australia) is largest hard-rock lithium mine in world. It is estimated that if entirety of Lithium ore from
African mines is extracted, it will be sufficient to meet demand for at least 27.78 million vehicles with 60
kWh batteries.
• Lithium triangle: It is one region of Andes rich in lithium reserves around borders of Argentina,
Bolivia, Chile. Lithium in this triangle is concentrated in various salt pans that exist along Atacama
Desert and neighboring arid areas, largest ones including - Salar de Uyuni (Bolivia), Salar de Atacama
(Chile), Salar del Hombre Muerto (Argentina).
This area is thought to hold around 54% of world's lithium reserves. Indian Navy has shown
interest in Lithium Triangle as lithium will be required on Li-ION batteries that are planned to be
fitted in future submarines.
Lithium Triangle accounts for 70% of global Lithium export.
• China has huge stake in lithium mines of Latin Americas. Global lithium mine production hit record
high in 2021.
 Uses:
• thermonuclear reactions i.e., fusion. Lithium is used in ceramics, glass, telecommunication,
aerospace industries.
• Lithium-ion Battery / Li-ion battery. <details in Battery topic>.
 India:
• Li is among “Prescribed substance” under Atomic Energy Act, 1962. Atomic Energy Act, 1962 permits Atomic
Minerals Directorate for Exploration and Research (AMD) for exploration of Lithium in many geological
domains of India.
→ Cobalt:
 Congo alone meets 80% of global cobalt needs.
→ India and critical minerals:
 Status:
• India imports almost all of its needs for rare earth metals and of lithium, Cobalt (mostly from China).
India’s demand for these critical resources has risen 6-fold in last 5 years as India tries to be
electronic and solar manufacturing hub. India’s 1 st -ever Lithium deposit site was found in Karnataka’s
Mandya district in 2021.
 Initiative:
• Khanij Bidesh India Ltd. (KABIL) has been setup to source and acquire mines in Argentina, Bolivia,
and Chile (called lithium triangle). It also carries out exploratory work to extract lithium from brine
pools of Rajasthan, Gujarat and mica belts of Odisha, Chhattisgarh; Critical Minerals Strategy for
India: It identified 49 minerals which will be vital for India’s future economic growth; Collaboration
with other world powers: Under QUAD, India is collaborating to ensure just and fair global
governance of critical mineral resources and remove supply constraints; ISRO commercialized
indigenously developed lithium-ion battery technology and has selected some companies for
transfer of technology; Set up of Lithium ion-batteries manufacturing plant in India, for example in
TN, Gujarat; Policy to incentives companies for setting up recycling facilities for lithium -ion batteries
and make it incumbent on producers to collect used batteries.
→ Rare-Earth Elements (REE) / Rare-Earth Metals / Rare-Earth Oxides / Lanthanides:
 What:
• Set of 17 nearly-indistinguishable lustrous silvery-white soft heavy metals. Scandium and yttrium are
considered REE because they tend to occur in same ore deposits as lanthanides and exhibit similar chemical
properties, but have different electronic and magnetic properties. That is, set of 15 lanthanides, Scandium
(Sc) and Yttrium (Y). They have unique catalytic, metallurgical, nuclear, electrical, magnetic, luminescent
properties. Though named ‘rare earth’, REE are not that rare and are relatively abundant in Earth’s crust.
They are also known as Rare Earth Minerals (REM).
 Type:
• Light RE elements (LREE); Heavy RE elements (HREE).
 REE supply:
• China – about 54%, North America – 18%, Asia (excluding China) – 14%, Australia – 12%, Europe –
2%.
 China and REE:

Page 267 of 719

 • China controls 80% of rare earth export i.e., world depends heavily on China for REE:
 USA imports 80% of its REE from China.
 EU imports 98% of its REE from China.
 India imports most of its REM in finished form from China.
This is one major concern in context of geopolitical issues with China.
 Initiatives taken by countries to reduce REE dependency on China:
• USA is committed to improve critical minerals supply chain, to boost REE production and processing, and to
work with allies to increase sustainable global supply.
 India:
• Status:
 India has world’s 5th largest reserves of REE. Government corporations - Indian Rare Earths Limited
(IREL) etc. had been granted monopoly. But, IREL’s REE production accounts for only fraction of world’s
production. IREL’s production is not enough for domestic consumption. Thus, India imports REE from
China. Some REEs are available in India — such as Lanthanum, Cerium, Neodymium, Praseodymium,
Samarium, etc. Others such as Dysprosium, Terbium, Europium, which are classified as HREEs, are not
available in Indian deposits in extractable quantities. Hence, there is dependence on countries such as
China for HREEs, which is one of leading producers of REEs, with estimated 70% share of global
production.
• Concern:
 Dependence on China: If India is not able to explore and produce these minerals, it will have to depend
on handful of countries, including China, to power its energy transition plans to electric vehicles. Lack
of expertise: Industry watchers say that reason India would not have found place in MSP grouping is
because India does not bring any expertise to table. Reserves and technology: In MSP group, countries
like Australia, Canada have reserves and also technology to extract them, and countries like Japan have
technology to process REEs.
• Reforms required / Way Forward:
 Opening of rare earth sector to competition, innovation, large investment [to compete with, and supply
to world]. Creation of one new Department for Rare Earths (DRE) under Ministry of Petroleum & Natural
Gas with functions like policy formulation; attracting investment; promoting R&D; allow private sector
companies within appropriate environmental safeguards. Creation of one autonomous regulator say,
Rare Earths Regulatory Authority of India (RRAI), to resolve disputes between companies and to check
compliance.
 Importance:
• They are crucial resources. They are of daily use (lighter, glass polishing, car alternators). REE are used in
high-end technology (catalysts, lasers, magnets, nuclear, batteries, fibre-optic telecommunication cables).
REE are also used in futuristic technologies (high-temperature superconductivity, safe storage and transport
of hydrogen for post-hydrocarbon economy, environmental global dewarming, energy efficiency). Their use
in technologies reduce weight, reduce emissions, reduce energy consumption, and thus are of greater
efficiency, performance, miniaturization, speed, durability, thermal stability.
• Used in electric vehicles: Minerals like Cobalt, Nickel, Lithium are required for batteries used in electric
vehicles. Used in consumer products: REEs are essential — although often tiny — component of more than
200 consumer products, including mobile phones, computer hard drives, electric and hybrid vehicles,
semiconductors, flatscreen TVs and monitors, and high-end electronics. India’s shift to clean energy: India
is seen as late mover in attempts to enter lithium value chain, coming at time when EVs are predicted to be
sector ripe for disruption. According to plan, 80% of India’s two- and three-wheeler fleet, 40% of buses, and
30 to 70% of cars will be EVs by 2030.
→ Fact:
 Poland, Germany, and Austria are emerging as battery manufacturing hubs of world. Australia has huge reserves
of Lithium, Cobalt, Nickel.
 Mines and Minerals (Development and Regulation) Act, 1957 / MMDR Act, 1957:
→ What:
 Act to provide for development and regulation of mines and minerals under control of Union of India. In
pursuance to mining related provision of Constitution / Schedule, Mines and Minerals (Development and
Regulation) Act, 1957 was framed.
→ Feature:
 It forms basic framework of mining regulation in India. It details process and conditions for acquiring mining
licence in India. For mining and prospecting in forest land, prior permission is needed from Ministry of
Environment and Forests.
→ Applicability:
 all mineral except minor minerals, atomic minerals. Mining minor minerals comes under purview of State
governments. River sand is considered minor mineral.
→ Mines and Minerals (Development and Regulation) Amendment Act, 2015:
Page 268 of 719
  To make wa for new regime of granting mineral concessions through auction to ensure transparency and non-
discrimination in allocation of mineral wealth of India. Auction regime has matured since then.
→ Mines and Minerals (Development and Regulation) Amendment Act, 2021:
 Under this reform, Government gives major boost to auction of mineral blocks, increasing production, improving
ease of doing business in India and increasing contribution of mineral production to GDP.
→ 2022 Amendment to Mines and Minerals (Development and Regulation) Act, 1957:
 What:
• In 2022, Union Cabinet approved amendments to Mines and Minerals (Regulation and Development) Act,
1957 for specifying rate of royalty in respect of Glauconite, Potash, Emerald, Platinum Group of Metals
(PGM), Andalusite, Sillimanite, Molybdenum.
 Implication:
• This approval would ensure auction of mineral blocks in respect of Glauconite, Potash, Emerald, Platinum
Group of metals, Andalusite, Molybdenum for 1st time in India. Encouraging indigenous mining of these
minerals is in national interest that would lead to reduction in imports in potash fertilizers, other minerals.
expected to increase generation of employment in mining sector. ensure increased availability of minerals
for downstream industries, and support agriculture. Reduction in import will led to saving valuable forex
reserves.
Note:
 Prescribed substance:
→ Under Atomic Energy Act, 1962, “Prescribed Substance” means any substance or any mineral which Central
Government may prescribe, being substance of atomic energy and includes: uranium, plutonium, thorium, beryllium,
deuterium etc.
 Minerals Security Partnership (MSP) [2022]:
→ What:
 One global alliance announced by USA in 2022 to reduce dependency on China to ensure key industrial supplies.
India is not part of MSP. It is one part of global ‘China-plus-one’ strategy adopted post Covid-19 pandemic that
caused massive supply-chain disruptions. It aims to develop alternatives to China to ensure key industrial
supplies. It is US-led partnership initiative of 11 nations to bolster critical mineral supply chains.
→ Feature:
 MSP will catalyze investment from governments and private sector. This grouping aims at catalyzing investment
from governments and private sector to develop strategic opportunities.
 MSP will focus on supply chains of minerals. It could focus on supply chains of minerals such as Cobalt, Nickel,
Lithium, 17 REEs.
→ Member:
 USA and 10 partners — Australia, Canada, Finland, France, Germany, Japan, South Korea, Sweden, UK, European
Commission.
→ India:
 Possible reasons India was left out:
• Dependence on China: If India is not able to explore and produce these minerals, it will have to depend on
handful of countries, including China, to power its energy transition plans to electric vehicles.
• Lack of expertise: Industry watchers say that reason India would not have found place in MSP grouping is
because India does not bring any expertise to table.
• Reserves and technology: In MSP group, countries like Australia, Canada have reserves and also technology
to extract them, and countries like Japan have technology to process REEs.
→ Way Forward:
 India is not part of this arrangement called the Minerals Security Partnership (MSP) but is working through
diplomatic channels to fetch an entry.
 Plus One / China-Plus-One:
→ It is one global business strategy coined in 2013. It refers to strategy in which companies avoid investing only in China
and diversify their businesses to alternative destinations.
 Minerals like Glauconite, Potash are used as fertilizer in agriculture. Platinum Group of Metals (PGM) are high value metal
used in many industries and new innovative applications. Minerals like Andalusite, molybdenum are vital minerals used
in industrial applications.
 Greenbushes lithium mine:
→ It is one open-pit mining operation in Western Australia and is world's largest hard-rock lithium mine. It is located to
south of town of Greenbushes, Western Australia.
Question:
 Some examples of, in India, officially designated major minerals are: Chromite, Kyanite, Sillimanite. Bentonite
is absorbent swelling clay consisting mostly of montmorillonite (one type of smectite). Main uses of bentonite
are in drilling mud and as binder, purifier, absorbent, and carrier for fertilizers or pesticides.
Mains Link:

Page 269 of 719

  Discuss the advantages of lithium ion batteries.
 What is a rare earth mineral? Why is it necessary for India to strategically develop capabilities to increase its production
in India? Suggest what reforms India should undertake to achieve this goal.
 Write a note on Mines and Mineral Laws (Amendment) Bill, 2021.
 Explain the distribution of major non-metallic minerals in India. Critically Analyze the National Mineral Policy, 2019 in
revitalizing the mining sector, increasing output and focusing on responsible and sustainable mining. (15M)

CORAL
News:
 2021:
→ UNESCO may downgrade status of Great Barrier Reef and put it into ‘List of World Heritage in Danger’. [This is
because of coral decline.]
→ Global Coral Reef Monitoring Network (GCRMN) releases report on status of coral reefs across world. Report
underlined catastrophic consequences of global warming but said some coral reefs can be saved by arresting
greenhouse gases (GHG).
 2022:
→ Scientists warns that Great Barrier Reef will face critical period of heat stress in 2022, following most widespread
coral bleaching natural world has ever endured.
→ 4 species of Azooxanthellate corals are recorded for 1st time from waters of AN Islands (India). All 4 groups of corals
are from same family Flabellidae.
→ According to Australian Institute of Marine Science (AIMS) report, highest levels of coral cover within past 36 years
have been recorded in northern and central parts of Australia’s Great Barrier Reef (GBR).
About:
 What:
→ Corals are marine invertebrates or animals (do not possess spine) which usually form compact colonies of many
identical individual polyps.
→ Corals are animals in same class as jellyfish and anemones.
→ Corals consist of individual polyps that get together and build reefs.
→ Coral species include important reef builders that inhabit tropical oceans.
 Type:
→ Hard coral: They extract Calcium Carbonate from seawater to build hard, white coral exoskeletons.
→ Soft Coral: They attach themselves to hard skeletons and older skeletons built by their ancestors.
 Feature:
→ Corals secrete calcium carbonate (CaCO3) to form hard skeleton. They are largest living structures on planet.
→ In symbiotic relationship, about 90% of energy of coral is provided by zooxanthellae (certain algae) which have
chlorophyll and other pigments.
→ Zooxanthellae algaes (are endowed with chlorophyll, other pigments) are responsible for yellow or reddish brown
colours of host coral.
 Coral Reef:
→ What:
 underwater ecosystem (structure) characterized by reef-building corals. [Reefs are formed of colonies of coral
polyps held together by calcium carbonate.]
→ Formation:
 Coral reefs are formed by colonies of coral polyps held together by calcium carbonate (CaCO3).
 Most coral reefs are built from stony corals / hard corals whose polyps cluster in groups.
→ Types:
 Fringing reefs
 Barrier reefs:
 Atolls: circular barrier reefs but without their central landmass.
→ Coral polyps and zooxanthellae:
 Normally, coral polyps live in endosymbiotic relationship with zooxanthellae.This relationship is crucial for health
of coral and reef,which provide shelter for approximately 25% of all marine life.In this relationship, coral provides
zooxanthellae with shelter. In return, zooxanthellae provide compounds that give energy to coral through
photosynthesis.This relationship has allowed coral to survive for about 210 million years in nutrient-poor
environments.Coral bleaching is caused by breakdown of this relationship.
 Issues:
→ Persistent rise of land temperature and sea temperature (climate change) which are threat to survival of corals.
→ Unless world acts together to reduce carbon emissions, all of world’s reefs will be bleached by end of this century.
→ When sea surface temperature increases beyond tolerable limit, Corals undergo process of bleaching (Coral
bleaching).
 Significance:

Page 270 of 719

 → Corals occupy < 1% of ocean floor but over 1 billion people benefit directly from coral reefs.
→ Coral reef tourism (about US dollar 35 billion).
→ Value of goods and services provided by coral reefs is estimated to be about US dollar 2.5 trillion per year.
→ net economic value (NEV) of world’s coral reefs is about US dollar 10 billion per year.
→ Corals control level of carbon dioxide (CO2) in water by converting it into limestone shell. If this process does not
take place, amount of CO2 in ocean water would increase significantly and affect ecological niches.
→ Coral reefs are important hotspots of biodiversity in ocean.
→ Coral reefs support wide range of species.
→ Coral reefs maintain quality of coastal biosphere.
→ Coral reefs support over 25% of marine biodiversity even though corals occupy only 1% of seafloor. Coral reef systems
generate USD 2.7 trillion in annual economic value through goods and service trade and tourism and other livelihood
activities.
Note:
 Coral bleaching:
→ What:
 Process when corals become white due to many stressors, such as changes in temperature, light, or nutrients.
 Coral bleaching is caused by breakdown of endosymbiotic relationship between Coral and zooxanthellae.
 Coral bleaching is when corals expel certain algae known as zooxanthellae, which lives in tissues of corals in
symbiotic relationship.
→ Process:
 Bleaching occurs when coral polyps expel algae (zooxanthellae) that live inside their tissue, causing coral to turn
white. Zooxanthellae are photosynthetic, and as water temperature rises, they begin to produce reactive oxygen
species.This is toxic to coral, and so coral expels zooxanthellae.Since zooxanthellae produce majority of coral
pigmentation,coral tissue becomes transparent, revealing coral skeleton made of calcium carbonate.Most
bleached corals appear bright white, but some are pastel blue, yellow, or pink due to proteins in coral.
→ Cause:
 When sea surface temperature increases beyond tolerable limit, Corals undergo process of bleaching.
 Scientists say main reason is rising sea temperatures as result of global warming caused by burning of fossil fuels.
 rising water temperature - leading cause of coral bleaching. Temperature about 1 °C above average can cause
bleaching. According to UNEP, between 2014 and 2016, longest recorded global bleaching events killed coral on
unprecedented scale. In 2016, bleaching of coral on Great Barrier Reef killed between 29-50% of reef's coral.
Bleaching extended into central region of reef.World's most bleaching tolerant corals can be found in southern
Persian/Arabian Gulf. Some of these corals bleach only when water temperatures exceed about 35 °C.
→ Aftermath:
 Bleached corals continue to live, but they are more vulnerable to disease and starvation.
 Zooxanthellae provide up to 90% of coral's energy,so corals are deprived of nutrients when zooxanthellae are
expelled.
 Some corals recover if conditions return to normal,and some corals can feed themselves.However, majority of
coral without zooxanthellae starve. When coral bleaches, coral does not die but comes pretty close to dying.
Some corals may survive and recover once sea surface temperature returns to normal levels.
 Great Barrier Reef / Great Barrier Reef Marine Park:
→ world's largest and longest coral reef system. composed of over 2,900 individual coral reefs and 900 islands stretching
for over 2,300 kilometres (roughly size of Italy) over area of approximately 344,400 square kilometres. located in
Coral Sea, off coast of Queensland, Australia in NE, separated from Queensland coast by channel 100 miles wide in
places and over 200 feet deep.
→ It can be seen from outer space and is world's biggest single structure made by living organisms.
→ This reef structure is composed of and built by billions of tiny organisms, known as coral polyps.
→ It supports wide diversity of life.
→ World Heritage Site (world’s 1st reef ecosystem to be recognised by UNESCO).
→ Cable News Network (CNN) labelled it one of 7 natural wonders of world in 1997.
→ It is included in Australian World Heritage places
→ Queensland National Trust named it state icon of Queensland.
→ Great Barrier Reef Marine Parkis home to about 1,625 type of fish, 133 varieties of shark and rays, 600 types of soft
corals and hard corals. It is home to 400 types of coral, 1500 species of fish, 4000 types of molluscs.
→ Issue:
 GBR has faced several mass coral bleaching in recent past (including recent one in 2022).
 Stony corals / hard corals:
→ corals that build themselves hard skeleton
 Zooxanthellae can live as endosymbionts with jellyfish also.
 Global Coral Reef Monitoring Network (GCRMN) coral reef report 2021:
→ In last decade, world lost about 15% of its coral reefs.
Page 271 of 719
 → Threats:
 Ocean-acidification
 warmer sea temperatures
 local stressors - overfishing, pollution, unsustainable tourism, poor coastal management.
→ Impact of global warming:
 Coral reefs across world are under stress from warming caused by climate change.
 Coral bleaching events caused by rise in sea surface temperatures (SST), leading to coral loss.
→ Loss of hard coral cover:
 steady decrease in hard coral cover in since 1980s when world lost about 10% of its corals.
 This is bad news because hard coral cover is indicator of coral reef health.
→ Algal bloom:
 Algal bloom on coral ridges is sign of stress on coral structures.
 Number of algae on world’s coral reefs is increasing.
 Australia:
→ Carbon emissions of Australia:
 Australia relies on coal-fired power, making Australia among world’s largest carbon emitters per capita.
 Australia’s conservative government supports its fossil fuel industries, arguing that tougher action on emissions
would cost jobs.
 3 mega ecological complexes on Earth:
→ Coral Triangle (CT):
 roughly triangular area in tropical waters in Asia-Pacific region around Indonesia, Malaysia, Papua New Guinea,
Philippines, Solomon Islands, Timor Leste.
 world’s epicentre of marine biodiversity
→ Congo Basin
→ Amazon Rainforest.
 Azooxanthellate corals:
→ They are group of corals that do not contain zooxanthellae and derive nourishment not from Sun but from capturing
different forms of plankton. They are deep-sea representatives, with majority of species reporting from between 200
m to 1000 m. Their occurrences are also reported from shallow coastal waters. Azooxanthellate corals are group of
hard corals. [Hard corals are prime and intrinsic part of coral reef ecosystem].
Mains Link:
 What is Coral bleaching? How it is affecting coral reefs across the world. Discuss.

FISCAL FEDERALISM
News:
 2020:
→ 15 th FC, led by Chairman N.K. Singh, submits its report to President.
Constitution:
 Article 280 (Finance Commission):
→ (1) President shall, at expiration of every 5 th year or at such earlier time as President considers necessary,
by order constitute one Finance Commission which shall consist of one Chairman and 4 other members to
be appointed by President.
→ (2) Parliament may by law determine qualifications which shall be requisite for appointment as members
of Commission and manner in which they shall be selected.
→ (3) It shall be duty of Commission to make recommendations to President as to :
 (a) distribution between Union and States of net proceeds of taxes which are to be, or may be, divided between
them and allocation between States of respective shares of such proceeds;
 (b) principles which should govern grants-in-aid of revenues of States out of Consolidated Fund of India; and
measures needed to augment Consolidated Fund of State to supplement resources of Panchayats in State on
basis of recommendations made by Finance Commission of State;
 (c) measures needed to augment Consolidated Fund of State to supplement resources of Municipalities in State
on basis of recommendations made by Finance Commission of State;
 (d) any other matter referred to Commission by President in interests of sound finance.
→ (4) Commission shall determine their procedure and shall have suc h powers in performance of their
functions as Parliament may by law confer on them.
About:
 What:
→ As one subfield of public economics, fiscal federalism is concerned with understanding which functions
and instruments are best centralized and which are best placed in sphere of decentralized levels of
government. In other words, it is study of how competencies (expenditure side) and fiscal instruments
(revenue side) are allocated across different (vertical) layers of administration. One important part of its

Page 272 of 719

 subject matter is system of transfer payments or grants by which central government shares its revenues
with lower levels of government.
 Revenue of States from Centre:
→ Ways:
 Devolution (States’ share of taxes): As State’s share of taxes from Gross Tax Revenue (extra-budgetary).
 Scheme related transfer: As Centrally Sponsored Schemes from Scheme Expenditure. (Based on Budget
Allocations).
 FC Grants: As transfer to States from Transfers, Expenditure, and other expenses. (based on budget allocations).
 Other transfers: Other grants or loans. (Based on Budget Allocations).
 Finance Commission (FC):
→ What:
 Constitutional body constituted usually after every 5 years under Article 280. It is at centre of fiscal federalism.
Submits recommendations to President.
→ Composition:
 As per Article 280, there shall be one Chairperson and 4 other members to be appointed by President.
→ Qualifications:
 As per Article 280, Parliament determines it and so Parliament enacted Finance Commission Act, 1951, which
says that:
• Chairman should be person with experience in public affairs; and
• 4 other members should be persons who - are qualified to be / sitting / retired / Judges of High Court; or
have special knowledge of finances and accounts of Government; or have wide experience in financial
matters and in administration; or have special knowledge of economics.
→ Duty:
 distribution of net proceeds of taxes between Union and States and allocation of respective shares of such
proceeds among States. grants-in- aid principles of revenues of States out of CFI. measures to augment CFS to
supplement resources of Panchayats and Municipalities in concerned State, based on recommendations of
concerned SFC. any other matter referred to it by President in interests of sound finance.
→ Significance:
 Addressing vertical imbalances between taxation of centre and States. Addressing horizontal imbalances across
all States.
→ 15 th FC:
 For 5 fiscal years starting from 1st April 2020.
 Terms of Reference (ToR):
• Recommending monitorable performance criteria for important national flagship programmes. examining
possibility of setting up permanent non lapsable funding for India’s defence needs. vertical and horizontal
tax devolution, local government grants, disaster management grant. recommend performance incentives
for States.
 Criteria for shares of States:
• income distance. 2011 population. Area. demographic performance. forest and ecology. tax effort.
 Recommendation:
• Vertical Devolution (Union to States): States’ share in divisible pool of taxes to 41% for 5-year period starting
2021-22.
• Horizontal Devolution (allocation between States): 15 th FC suggested 45% weightage to income, 15% to
population, 15% to area, 12.5% to demographic performance, 10% to forest and ecology, 2.5% to tax and
fiscal efforts.
 Challenges:
• reorganisation of State of Jammu and Kashmir into 2 UTs. Federal polity.
→ Conclusion:
 As one important Constitutional entity, FC is committed to balancing competing claims and priorities among all
3 tiers of government in credible manner.
Mains Link:
 Give an account of the composition and functions of the Finance Commission as mentioned in the Constitution of India.

INEQUALITY (INCOME)
News:
 2021:
→ 2022 World Inequality Report (WIR) released.
 2022:
→ Economic Advisory Council to Prime Minister (EAC-PM) releases ‘State of Inequality in India’ Report [2019-20].
Constitution:
 Article 39 (Certain principles of policy to be followed by State):

Page 273 of 719

 → state shall direct its policy towards securing:
 ….
 that operation of economic system does not result in concentration of wealth and means of production to
common detriment
 ….
About:
 India at 75 years of Independence:
→ On development pattern with national income:
 Growth Pattern:
• From 1900-01 to 1946-47, National Income growth was 1% per annum. From 1950-51 to 2019-20, GDP
doubled every 14 years and GDP per capita doubled every 24 years. India’s rapid economic growth since
1980 led to substantial reduction in absolute poverty.
 Issues:
• Comparison with East or SE Asia economies: They have performed better than Indian Economy. For
example, per capita income as proportion of that of world economy rose from 12% to 18% for India, 13% to
87% for China, and 10% to 35% for Indonesia.
• Growing equality: Economic growth in India has been associated with unequal outcomes that have created
divides between regions, sectors, and people.
• Regional divide: Western and Southern India have developed more than east and north of India.
• Widening gap between richer and poorer States.
• 1950-51 to 2019-20: Agricultural sector’s share in GDP fell from 58% to 15%.
• World Inequality Report 2021 estimated that top 1% held as much as 33% of total wealth in India and top
10% held 65% of total wealth.
 Way Forward:
→ Economic growth can be transformed into meaningful development only if it brings about improvement in living
conditions of people. It is essential to recognize that employment is not only source of growth but also means of
mobilizing people, which is most abundant resource for development in India.
→ 2022 World Inequality Report (WIR) report recommended wealth taxes on super-rich and redistribution as policy
measures.
Note:
 World Inequality Report (WIR) [2018]:
→ What:
 It studies different kinds of financial data to find out how country’s / world’s income and wealth are distributed.
 It provides estimates of global income and wealth inequality based on most recent findings compiled by World
Inequality Database (WID). [WID, also referred to as WID.world, is open source database, that is part of
international collaborative effort of over 100 researchers in 5 continents].
 It includes discussions on potential future academic research as well as content useful for public debates and
policy related to economic inequality.
 released by World Inequality Lab (research center at Paris School of Economics).
→ Significance:
 In most democracies, wealthy do transform their economic power into political power. Therefore, higher
inequality, greater is likelihood that wealthy minority determining fate of majority.
 It can help generate public opinion in favour of policy measures that can reduce inequality.
→ 2022 World Inequality Report (WIR) report:
 Gap between rich and poor in terms of share of national income (NI) is quite large.
 Gap between rich and poor (NI) is growing rapidly because of government policies favouring wealthy elites.
 Richest 10% of global population get about 50% of global income
 Global wealth inequities are worse than Global income inequalities.
 Richest 10% own about 75% of all wealth.
 Inequality between countries narrowing.
 Inequality within countries increasing.
 Countries are growing richer, governments are becoming poorer:
• Share of privately owned wealth in national wealth is rising, Share of public wealth (buildings, universities,
roads, hospitals etc) is shrinking.
 Inequality across continents:
• Europe is region with least amount of inequality
• Inequality is highest in MENA (Middle East North Africa) region.
 India:
• India is one of world’s most unequal countries:
 top 1% getting about 20% of national income).
 Top 10% get about 55% of national income
Page 274 of 719
  top 10% earned about 20 times more average national income than bottom 50%
• Today, income inequality in India is worse than it was under British rule. In decades after independence,
socialistic economic policies reduced income inequality. But, from 1980s, deregulation and liberalisation
policies led to one of most extreme increases in income and wealth inequality.
 Conclusion:
• This report says inequality and poverty are not unavoidable but mainly effect of policy choices.
• Inequalities rose around globe from 1980s onward because of liberalisation.
• This report recommends wealth taxes on super-rich and redistribution as policy measures.
 State of Inequality in India Report:
→ State of Inequality in India Report [2019-20]:
 Highlights:
• Share of top 1% accounts for 6-7% of total incomes earned.
• Share of top 10% accounts for 1/3rd of all incomes earned.
• In 2019-20, among different employment categories, highest % was self-employed workers followed by
regular salaried workers and casual workers.
• India’s unemployment rate is 4.8% (2019-20), and Worker Population Ratio is 46.8%.
• In area of health infrastructure, there is considerable improvement in increasing infrastructural capacity
with targeted focus on rural areas.
Glossary:
 National Income:
→ Total amount of money earned within country.
Mains Link:
 Discuss the concerns associated with the rising inequality in India.

WETLAND
News:
 2020:
→ Tso Kar wetland of Ladakh added to ramsar list.
 2021:
→ Sultanpur National Park (Haryana), Bhindawas Wildlife Sanctuary (Haryana), Thol Wildlife Sanctuary
(Gujarat), Wadhwana wetland (Gujarat) are given ramsar recognition.
→ Degradation of Assam’s DeeporBeel due to anthropog enic forces.
 2022:
→ Two new sites - Khijadiya Bird sanctuary (Gujarat), Bakhira Bird sanctuary (UP) declared Ramsar site.
→ Menar (recognised as “bird village” in Rajasthan) in Rajasthan is set to be notified as Rajasthan’s new
wetland. [This will pave way for getting Ramsar site status for this rural heartland]. At present, Rajasthan
has 2 wetlands recognised as Ramsar sites – Keoladeo Ghana NP / Keoladeo Ghana Wetland / Keoladeo
Ghana Bird Sanctuary / Bharatpur Bird Sanctuary (which is now in Montreux record) and Sambhar Salt
Lake.
→ India designates 5 new Wetlands of International Importance, which include 3 wetlands ( Karikili Bird
Sanctuary, Pallikaranai Marsh Reserve Forest, Pichavaram Mangrove ) in TN, 1 (Pala wetland) in Mizoram,
and 1 wetland (Sakhya Sagar) in MP, making total of 54 Ramsar sites in India.
→ India adds 10 more wetlands designated as Ramsar sites to make total 64 sites. India is one of Contracting
Parties to Ramsar Convention, 1971. [Being designated Ramsar Site means now these sites will be on global
map for their importance in providing ecological services.]. Added are: Koonthankulam Bird Sanctuary (TN),
Gulf of Mannar Marine Biosphere Reserve (TN), Vembannur Wetland Complex (TN), Vellode Bird Sanctuary
(TN), Vedanthangal Bird Sanctuary (TN), Udhayamarthandapuram Bird Sanctuary (TN), Satkosia Gorge
(Odisha), Nanda Lake (Goa), Ranganathittu Bird Sanctuary (Karnataka), Sirpur Wetland (Madhya Pradesh).
→ India adds 11 more wetlands designated as Ramsar sites to make total 75 sites. India is one of Contracting
Parties to Ramsar Convention, 1971. [Being designated Ramsar Site means now these sites will be on global
map for their importance in providing ecological services .]. Added are: Tampara Lake (Odisha), Hirakud
Reservoir (Odisha), Ansupa Lake (Odisha), Yashwant Sagar (MP), Chitrangudi Bird Sanctuary (TN),
Suchindram Theroor Wetland Complex (TN), Vaduvur Bird Sanctuary (TN), Kanjirankulam Bird Sanctuary
(TN), Thane Creek (MH), Hygam Wetland Conservation Reserve (JK), Shallbugh Wetland Conservation
Reserve (JK).
About:
 What:
→ Area where water body meets land. Ex. mangroves, marshes, peatlands, rivers, lakes, deltas, floodplains,
swamps, paddy-fields, coral reefs, other water bodies.
 Protection:
→ Ramsar Convention on wetlands. UNESCO Man and Biosphere (MAB) Programme. ...
 Significance:
Page 275 of 719
 → People’s health depends on healthy wetlands. Many species live, breed in wetlands. “nurseries of life” –
animals breed in wetlands. “kidneys of earth” –clean environment of pollutants. “mitigation of climate
change” –store land based carbon. “minimization of disaster risks” –absorb storm surge.
 India:
→ India has rich wetlands. Wetlands in India are of great biodiversity. India has many Ramsar sites -globally
significant wetlands of India.
→ Wetlands (Conservation and Management) Rules, 2017.
Note:
 Ramsar convention 1971:
→ What:
 known officially as Convention on Wetlands of International Importance / Waterfowl Habitat / Convention on
Wetlands. international treaty for conservation and wise use of wetlands. named after Iranian city of Ramsar,
on Caspian Sea, where it was signed in 1971. Almost 90% of UN member states are part of it.
→ Ramsar List / List of Ramsar Wetlands of International Importance:
 What:
• List defined by Ramsar Convention for conservation and sustainable use of wetlands, recognizing
fundamental ecological functions of wetlands and their economic, cultural, scientific, and recreational
value. Ramsar convention establishes that wetlands should be selected for Ramsar list of their international
significance in terms of ecology, botany, zoology, limnology or hydrology. Ramsar List organizes Ramsar
sites.
 Ramsar Site:
• wetland site designated to be of international importance under Ramsar Convention i.e. site included in
Ramsar List. India: India currently has 49 sites (highest in South Asia) designated as Wetlands of
International Importance (Ramsar Sites).
→ Montreux Record:
 Montreux Record is also under Ramsar Convention. Register of wetland sites on Ramsar List where changes in
ecological character: have occurred or, are occurring, or are likely to occur as result of technological
developments, pollution or other human interference. It is maintained as part of Ramsar List. Wetland sites may
be added to and removed from Montreux Record only with approval of Contracting Parties in which they lie.
 India:
• Keoladeo National Park, Rajasthan. Loktak Lake, Manipur. Note: Chilkalake, Odisha was placed in it but was
later removed.
 Ladakh’s Tso Kar:
→ Tso Kar Basin is one high-altitude wetland complex. It consists of: Startsapuk Tso - freshwater lake; Tso Kar
- hyper saline lake. Tso Kar means white lake [because of white salt efflorescence found on margins caused
by evaporation of highly saline water.]. ramsar site. Important Bird Area (IBA) as per BirdLife International.
key bird staging site in Central Asian Flyway (CAF).
 DeeparBeel / DeeporBeel / DiporBeel / DeeparBil / DeeporBil / DiporBil:
→ permanent freshwater lake. located near Brahmaputra River. one of largest freshwater lakes in Assam.
Assam’s only Ramsar site. Important Bird Area (important destination for many migratory species of birds).
→ Concern: Human activities - dumping of garbage, construction of roads and railways, construction of warehouses,
tourism activities. This degradation caused: death of elephants in railway accidents; fewer elephants visiting wetland
due to deteriorating quality of water because of garbage dumping; reduction in fishes for fishermen.
 World Wetlands Day:
→ 2nd Feb. every year. marks anniversary of signing of Ramsar convention in 1971.
 Pallikaranai Marsh Reserve Forest (TN): It is one freshwater marsh in Chennai. It is only surviving wetland ecosystem
in Chennai and last remaining natural wetlands of South India.
 Pichavaram Mangrove (TN): It could be counted among largest mangrove forests in India.
 Pala wetland (Mizoram): It is largest natural wetland in Mizoram. Wetland is surrounded by green woodlands.
 Sakhya Sagar (MP): This lake is integral part of Madhav National Park in Madhya Pradesh.
Question:
 Hokera Wetland – JK. Renuka Wetland – Himachal Pradesh. Rudrasagar Lake — Tripura. Sasthamkotta Lake – Kerala.
Mains Link:
 Discuss the importance and role played by Wetlands in the Ecological conservation of Earth. (15M)

NITROGEN (N)
News:
 2021:
→ International Nitrogen Initiative (INI) conference, 2020 held - virtually in 2021.
→ Ammonia levels increase in Yamuna river.
→ Ammonia gas leakage incident in UP.

Page 276 of 719

 → In development that has potential to revolutionise agriculture sector across world, Indian Farmers
Fertiliser Cooperative (IFFCO) claims it has started commercial production of ‘nano urea liquid’, 1 st -of-its-
kind product. Nano urea liquid is expected to potentially replace 13.7 million tonnes of conventional urea
usage by 2023. IFFCO has started field trials of nano version of DAP fertilizer (Diammonium phosphate).
 2022:
→ PM Modi inaugurates India’s 1 st liquid nano urea plant at Kalol, Gujarat. It will be produced by Indian
Farmers Fertiliser Cooperative Limited (IFFCO).
→ Ministry of Power notifies Green Hydrogen/Green Ammonia Policy for production of Green Hydrogen or Green
Ammonia using renewable sources of energy.
→ Water supply gets disrupted in Delhi once again when ammonia levels in Yamuna river remained high.
Concentration of ammonia in Yamuna river is about 7 times (about 7.4 ppm) level that Delhi Jal Board’s
water treatment plants (WTPs) can process (1 ppm).
→ Researchers from National Centre for Biological Sciences, part of Tata Institute of Fundamental Research,
Bengaluru (NCBS-TIFR) find one new pathway that regulates nitrate absorption in plants .
 This new method:
• Gene transcription factor MADS27, which regulates nitrate absorption, root development and stress
tolerance, is activated by micro-RNA, miR444, therefore offering one new way to control these properties
of plant. This ‘miR444’ can be used to increase:
 nitrate absorption;
 enhance root development; and
 help plant to tolerate more stress.
• Transcription factors are proteins involved in process of converting, or transcribing, DNA into RNA.
Transcription factors include wide number of proteins, excluding RNA polymerase, that initiate and regulate
transcription of genes. In molecular biology, transcription factor (TF) (or sequence-specific DNA-binding
factor) is one protein that controls rate of transcription of genetic information from DNA to messenger RNA,
by binding to specific DNA sequence. Function of TFs is to regulate — turn on and off — genes in order to
make sure that they are expressed in desired cells at right time and in right amount throughout life of cell
and organism.
→ Union Minister of Chemical and Fertilizers, Dr. Mansukh Mandavi y says that 6 crore bottles of nano urea -
equivalent to 27 lakh MT of conventional urea will be produced and made available to farmers in 2022 -23.
→ Nano urea fast-tracked for approval despite incomplete trials: Normally, 3 seasons of independent
assessment by ICAR is required for approving any new fertiliser, but in case of nano urea, this was reduced
to 2. Scientists are still unclear if this product can on its own cut farmers’ dependence on urea.
Government’s view: Government clarifies that established an d existing procedures are fully followed for
registration of this Nano urea fertilizer as per Fertiliser (Control) Order, 1985. [Nano Urea has been
provisionally notified under FCO based on encouraging results and feedback received from ICAR and State
Agricultural Universities].
About:
 Source:
→ N is most abundant element in atmosphere. About 78% of dry air on Earth is N.
 Feature:
→ Nitrogen is one essential nutrient. Nitrogen is vital macro -nutrient for most plants. But, atmospheric N /
Dinitrogen (N2) is unreactive and cannot be utilised by plants directly. Therefore, nitrogen-fixing (N-fixing)
bacteria - rhizobia etc. live symbiotically with leguminous plants. This provides N to plant and soil in form
of reactive compounds – ammonia, nitrate.
 Nitrogen cycle / N-cycle:
→ N in atmosphere. N organic matter in soil. Ammonium (NH4) in soil and water. Nitrite (N02) in soil and
water. Nitrate (NO3) in soil and water. Nitrate, Ammonium in plants, crops. Nitrate in animals – livestock,
fish etc. NOx in clouds.
 Need for regulating Nitrogen:
→ Development of plant: N is one of most important macronutrients needed for development of plant. It is
part of chlorophyll, amino acids and nucleic acids, among others.
→ Gene expression: Nitrates also play role in controlling genome -wide gene expression that in turn regulates
root system architecture, flowering time, leaf development, etc.
→ Control pollution: Overuse of nitrates in fertilizers leads to accumulation of nitrates in water and soil. This
accumulation adds to soil and water pollution and increased contribution of GHGs.
 Nitrogen pollution:
→ N as pollutant: N compounds / fertilisers etc. running off farmland [N pollution in water]. N emissions from
industry, agriculture, vehicles [N pollution in air]. Therefore, N becomes pollutant when it escapes into
environment – atmosphere, water sources, soil - and reacts with other organic compounds.
→ Harmful effects: Algal blooms [algae produce toxins harmful to human, aquatic organisms, fishery,
biodiversity in coastal areas]. Dead zones in water bodies. Nitrate contaminated drinking water. Excessive
Page 277 of 719
 N fertiliser on soil leads to soil nutrient depletion , leading to arable land loss and harming food security.
Nitrous Oxide (N2O) is one GHG.
 Initiative:
→ International Nitrogen Initiative (INI) Conference [2003] [Global Nitrogen Conference].
 Ammonia (NH3):
→ What:
 Inorganic, colourless gas, lighter than air, pungent smell, aqueous form is called ammonium hydroxide
-> danger.
 It occurs naturally in environment from breakdown of organic waste.
 It is building block for Ammonium Nitrate (NH4NO3) that is used in agriculture as high-nitrogen
fertiliser.
→ Green ammonia:
 Ammonia is pungent gas widely used to make agricultural fertilisers. Green ammonia production is
where process of making ammonia is 100% renewable and carbon -free. One way of making green
ammonia is by using hydrogen from water electrolysis and nitrogen separated from air. Then, they are
fed into Haber process (Haber-Bosch), all powered by sustainable electricity. In Haber process,
hydrogen and nitrogen are reacted together at high temperatures and pressures t o produce ammonia,
NH3.
→ Usage:
 Ammonia is used as input chemical in production of: Fertilisers, formaldehyde, plastics, synthetic fibres,
dyes, other products.
→ Ammonia Contamination / Ammonia Pollution:
 As per BIS, acceptable maximum limit of ammonia in drinking water is 0.5 ppm.
 How: Ammonia finds its way to ground / surface water sources through industrial effluents / sewage.
 Impact:
• toxic to marine, humans, fish.
• NH3 interacts immediately on contact with moisture present in skin, eyes, oral cavity, and respiratory tract
and forms Ammonium Hydroxide. Ammonium Hydroxide is very caustic and disrupts cells and ultimately
leads to cellular destruction.
→ Way Forward:
 Stringent implementation of guidelines against dumping harmful waste into river.
 untreated sewage should not enter water.
 Maintain sustainable minimum flow, called ecological flow. This is minimum amount of water that
should flow throughout river at all times to sustain underwater and estuarine ecosystems and human
livelihoods, and for self regulation.
→ Initiative:
 In 2022, centre notified green hydrogen / green ammonia policy that offers 25 years of free power for any new
renewable energy plants set up for green hydrogen / green Ammonia production before 2025.
 Urea:
→ What:
 It is also known as carbamide. One organic compound with chemical formula CO(NH2)2. This amide
has two – NH2 groups joined by one carbonyl (C=O) functional group. Urea is one chemical nitrogen
fertilizer, white in colour, which artificially provides nitrog en, major nutrient required by plants.
→ History:
 Friedrich Wohler discovered that urea can be produced from inorganic starting materials, which was
important conceptual milestone in chemistry in 1828. It showed for 1 st time that substance previously
known only as byproduct of life could be synthesized in laboratory without biological starting
materials, thereby contradicting widely held doctrine of vitalism, which stated that only living
organisms could produce chemicals of life.
→ Feature:
 It is colorless, odorless solid, highly soluble in water, and practically non -toxic.
 Dissolved in water, it is neither acidic nor alkaline.
 Our body uses it in many processes, most notably nitrogen excretion. Liver forms Urea by combining
two ammonia molecules (NH3) with one carbon dioxide (CO2) molecule in urea cycle.
→ Significance:
 Urea is widely used in fertilizers as source of nitrogen (N) and is important raw material for chemical
industry.
 Urea serves important role in metabolism of nitrogen -containing compounds by animals and is main
nitrogen-containing substance in urine of mammals.
→ India:

Page 278 of 719

 
Conventional granular urea is one of most important nitrogenous fertilisers in India, with high nitrogen
content of 46%, and is available at one of lowest market prices.
 Urea also forms 82% of total nitrogenous fertilisers consumed in India.
 India is dependent on imports of widely used fertilizer.
→ Nano Urea:
 What:
• It is essentially urea in form of nanoparticle. IFFCO Nano Urea is urea in liquid form i.e. smaller size (20-
50 nm) than conventional granular form and is patented chemical nitrogen fertilizer. India’s ‘21st century’
product aiming to revolutionise world agriculture. It was developed indigenously at IFFCO. It is one eco
friendly liquid fertilizer. Nano urea is one patented and indigenously made liquid (developed and patented
by IFFCO) that contains nanoparticles of urea.
 Feature:
• Application of 1 bottle of Nano Urea can effectively replace at least 1 bag of conventional Urea.
• Its small size increases its availability to crop by more than 80%.
• One single ½ litre bottle of this liquid can compensate for 45kg sack of urea that farmers traditionally rely
on.
 Mechanism:
• When sprayed on leaves, Nano Urea easily enters through stomata and other openings and is assimilated
by plant cells. It is easily distributed through phloem from source to sink inside plant as per its need.
Unutilized nitrogen is stored in plant vacuole and is slowly released for proper growth and development of
plant.
 Benefit:
• Fertilizers in nano form provide targeted supply of nutrients to crops, as they are absorbed by stomata,
pores found on epidermis of leaves.
• Reduces unbalanced and indiscriminate use of conventional urea.
• Increases crop productivity by 8%.
• Reduces soil, water, and air pollution.
 Significance:
• In 2022, PM Modi pointed out that Nano Urea was a medium to produce more with less cost. He further
said that a sack full of urea could be replaced by a single bottle of nano urea. He further added that the
transportation costs of urea would go down significantly.
• This product is expected to replace usage of urea granules, one of most widely used fertilisers in farmlands
across world.
• IFFCO says IFFCO Nano Urea is product of 21st century and it is need of hour to keep environment soil, air
and water, safe for future generations while securing food for all.
• According to IFFCO, this nano urea liquid will increase production of crops with improved nutritional quality.
It is cheaper than conventional urea. It is also expected to reduce environmental pollution caused by
granular form, by reducing its excessive application that exacerbates soil, water and air pollution with
climate change problems.
• IFFCO says nano urea liquid will radically transform farming in India and across world by raising productivity
while reducing environmental pollution and input cost, by: lower usage and cost, increased productivity,
better plant nutrition, less environmental fallout.
 Liquid nano urea vs conventional urea:
• Cost: Liquid nano urea is cheaper (Rs. 240 for half litre without subsidy; International market price of 1 bag
of urea is between Rs. 3,500 and Rs. 4,000. 1 bottle of nano urea can effectively replace at least 1 bag of
urea).
• Benefits for government: Liquid nano urea reduces fertilizer subsidy bill of government. India is dependent
on imports of widely used fertilizer.
• Efficiency of liquid nano urea can be as high as 85-90% (Conventional urea has efficiency of about 25%).
• Liquid nano urea has shelf life of 1 year, and farmers need not be worried about “caking” when it comes in
contact with moisture.
Note:
 International Nitrogen Initiative (INI) Conference [2003]:
→ What:
 Global Nitrogen Conference. Triennial event.
 It brings together scientists from world dealing with reactive N compounds in: agriculture, industry, traffic, soil,
water, air.
 One partner of Future Earth [2012].
→ Objective:
 Exchange among policymakers, stakeholders of results, ideas, visions to improve future holistic management of
reactive N.
Page 279 of 719
  Future Earth [2012]:
→ 10-year international research program which aims to: build knowledge about environmental and human aspects of
Global change; find solutions for sustainable development; and increase impact of scientific research on sustainable
development.
 Indian Farmers Fertiliser Cooperative Limited (IFFCO) [1967]:
→ multi-State cooperative society.
→ IFFCO is wholly owned by Cooperative Societies of India. This society is engaged in business of
manufacturing and marketing of fertilizers.
→ IFFCO is headquartered in New Delhi, India.
→ It is today biggest co-op in world by turnover.
→ India’s largest fertiliser seller, manufacturer and cooperative.
 Ecological flow:
→ This is minimum amount of water that should flow throughout river at all times to sustain underwater and
estuarine ecosystems and human livelihoods, and for self regulation.
 Green Hydrogen / Green Ammonia Policy [2022]:
→ What:
 One major policy enabler by Government for production of Green Hydrogen / Green Ammonia using
Renewable sources of energy.
 One step forward towards National Hydrogen Mission.
→ Need:
 Hydrogen and Ammonia are envisaged to be future fuels to replace fossil fuels. Production of these
fuels by using power from renewable energy, termed as green hydrogen and green ammonia, is one
of major requirements towards environmentally sustainable energy security of India. Thus,
Government of India is taking various measures to facilitate transition from fossil fuel / fossil fuel
based feed stocks to green hydrogen / green ammonia.
→ Provision:
 Green Hydrogen / Ammonia manufacturers may purchase renewable power from power exchange or
set up renewable energy capacity themselves or through any other, developer, anywhere.
 Open access will be granted within 15 days of receipt of application.
 Green Hydrogen / Ammonia manufacturer can bank his unconsumed renewable power, up to 30 days,
with distribution company and take it back when required.
 Distribution licensees can also procure and supply Renewable Energy to manufacturers of Green
Hydrogen / Green Ammonia in their States at concessional prices which will only include cost of
procurement, wheeling charges and small margin as determined by State Commission.
 Waiver of inter-State transmission charges for period of 25 years will be allowed to manufacturers of
Green Hydrogen and Green Ammonia for projects commissioned before 2025.
 Manufacturers of Green Hydrogen / Ammonia and renewable energy plant shall be given connectivity
to grid on priority basis to avoid any procedural delays.
 Benefit of Renewable Purchase Obligation (RPO) will be granted incentive to hydrogen / Ammonia
manufacturer and Distribution licensee for consumption of renewable power.
 To ensure ease of doing business, one single portal for carrying out all activities including statutory
clearances in time bound manner will be set up by MNRE.
 Connectivity, at generation end and Green Hydrogen / Green Ammonia manufacturing end, to inter -
State transmission system (ISTS) for Renewable Energy capacity set up for purpose of manufacturing
Green Hydrogen / Green Ammonia shall be granted on priority.
 Manufacturers of Green Hydrogen / Green Ammonia shall be allowed to set up bunkers near Ports for
storage of Green Ammonia for export / use by shipping. Land for storage for this purpose shall be
provided by respective Port Authorities at applicable charges.
→ Significance:
 Implementation of this Policy will provide clean fuel to common people of India.
 This will reduce dependence on fossil fuel and also reduce crude oil imports.
 It will help emerge India as export Hub for Green Hydrogen and Green Ammonia.
 This policy promotes Renewable Energy (RE) generation as RE will be basic ingredient in making green
hydrogen. This in turn will help in meeting international commitments for clean energy.
 Haber–Bosch process / Haber process / Haber ammonia process / synthetic ammonia process:
→ Artificial N fixation process. Method of directly synthesizing ammonia from hydrogen and nitrogen. Main
industrial procedure for production of ammonia today.
Value Addition:
 Neem-Coated Urea:
→ What:
 Urea fertilizer that is coated with neem tree seed oil.

Page 280 of 719

  It is one agriculture scheme supported by Government of India to boost growth of wheat and paddy,
and curb black market and hoarding of urea.
→ Benefit:
 Neem coating leads to more gradual release of urea.
 Help plants gain more nutrient and resulting in higher yields.
 100% Neem coating of Urea improves Soil Health, and boosts yields.
 Increase of Crop-specific yields by 15-30% on average.
 Higher levels of soil fertility.
→ Fact:
 In 2015, urea manufacturers were mandated by government to increase their production from 35% to
75% of their subsidised amounts of neem-coated urea.
 In 2019, finance minister Nirmala Sitharaman spoke about increased promotion of neem coated urea
among farmers which will help to reduce cost of cultivation.
 Patent for Neem Coated Urea is owned by Aditya Birla Nuvo Ltd and it's assignees are Aditya Birla
Nuvo Ltd. & Aditya Birla Science and Technology co. ltd. under guidance of Dr. Prashant Puri, who is
primary innovator in this area.
Question:
 Agricultural soils release NOx into environment. Cattle release ammonia into environment. Poultry industry releases
reactive nitrogen compounds into environment.
 Excretion of urea by animals; and Death of vegetation add nitrogen to soil. Burning of coal by man does not add Nitrogen
to soil, and instead burning of coal creates fly ash which is devoid of nitrogen content.
Mains Link:
 Discuss the significance of sustainable nitrogen management for agriculture and the economy in India. (250 words)

FACIAL RECOGNITION SYSTEM

News:
 2020:
→ No specific laws or guidelines to regulate use of Facial Recognition Tracking (FRT) system - potentially
invasive technology.
 2021:
→ 4 Airports in India (Varanasi, Pune, Kolkata, Vijaywada) will be 1st to use facial recognition technology -
based biometric boarding system so that passengers will be able to use face scan as their boarding pass.
(Airports Authority of India engages NEC Corporation Private Limited for implementing this technology as
part of DigiYatra policy [2018])
 2022:
→ Two retail chain companies in Australia, Bunnings Warehouse and Kmart Australia, are being investigated
for using facial recognition technology and storing d ata of their customers without their knowledge.
→ RTI responses received by Internet Freedom Foundation, one New-Delhi based digital rights organisation,
reveal that Delhi Police treats matches of above 80% similarity generated by its facial recognition
technology (FRT) system as +ve results.
About:
 What:
→ Facial recognition system is one technology capable of matching human face from digital image or video frame
against database of faces, typically employed to authenticate users through ID verification services, works by
pinpointing and measuring facial features from given image.
→ It is one biometric technology that uses distinctive features on face to identify and distinguish individual.
→ One automated process of comparing 2 images of faces to determine whether they represent same individual. [Also,
recently DigiYatra (facial recognition technology) has been operationalised at many Indian airports].
 Mechanism:
→ It is one automated Facial Recognition System (AFRS), which works by maintaining large database of photos and
videos of peoples’ faces. New image of unidentified person — often taken from CCTV footage — is compared with
existing database to find match and thus identify person. FRT works by capturing people’s faces from photographs
or video footage as unique faceprint. Image is then saved and can be compared to other faceprints stored in common
database. While this technology can help verify person’s face, it also raises several privacy issues.
→ In short, capturing -> extracting -> comparing -> matching.
 Benefits:
→ Criminal identification and verification. Easy identification amongst crowd. Crime investigation capabilities. Civilian
verification when needed. No one will be able to get away with fake ID.
→ Potential benefits in various aspects of law enforcement:
 Helps in finding missing people and identifying perpetrators. Identification of Missing Children ex. in 2018, Delhi
Police trial of one facial recognition system commissioned by Delhi High Court helped correctly identify
approximately 3000 missing children. Improving outcomes in area of Criminal identification and verification.
Page 281 of 719
 Pehchaan citizen app in Uttar Pradesh provides users with confidence score of likelihood that 2 faces belong to
same person by running face against all India criminal database. Better security measures in banks and airports.
GOI‘s Digi-Yatra policy is to give seamless, hassle-free, and paperless journey experience to every air traveller in
India. Helps civilian verification when needed and helps in reduction of fake IDs. Drastically reduces human
touchpoints as facial recognition requires fewer human resources than other types of security measures, such
as fingerprinting.
 Concerns:
→ Absence of specific laws or guidelines. Thus, Supreme Court landmark Puttaswamy privacy judgment is not taken
into account. Threat to fundamental rights of privacy, freedom of speech and expression. Privacy Impact Assessment
not conducted. Misuse example over-policing; mass surveillance.
→ Accuracy rates fall starkly based on race and gender: This can result in false +ve, where person is misidentified as
someone else, or false -ve where person is not verified as himself. Delhi Police treats matches of above 80% similarity
generated by its FRT system as +ve results (as per RTI response).
→ Greater threat to individual and societal privacy. FRT system violates right to privacy: As per Puttaswamy judgment,
Privacy is fundamental right, even in public spaces, large-scale recordings, storing and analysis of images undermine
this right because it means it won’t be possible to do anything in public without state knowing about it.
→ Issues of ‘Function Creep’: Delhi police widening of purpose for FRT (from finding missing children to surveillance)
demonstrates instance of ‘function creep’ wherein technology or system gradually widens its scope from its original
purpose to encompass and fulfil wider functions.
→ Violates personal rights and can infringe on personal freedoms. Informed consent: FRT is typically deployed without
consent, by both private and public sectors.
→ State surveillance: FRT technology makes it possible for Government and law enforcement agencies to identify
people who attend or participate in rallies or in any other form of political or social dissent and thereafter potentially
put them under surveillance to track their movement. Eg. allegations that Delhi Police were using FRT to surveil anti-
CAA protests in 2019, 2020 Delhi riots, 2021 Red Fort violence, and 2022 Jahangirpuri riots.
→ Creates data vulnerabilities: There is also concern about storage of facial recognition data, as these databases have
potential to be breached. Provides opportunities for fraud and other crimes.
→ Factors that could influence efficacy, accuracy, and potential biases of FRT in India include skin colour, geography,
religion, and caste.
→ Lawful Intercept and Monitoring project (LIM), Crime and Criminal Tracking Network & Systems (CCTNS), and
Networking Traffic Analysis (NETRA), have been criticized for facilitating mass surveillance, being opaque, and
implemented without clear legal backing or oversight mechanisms.
 Initiative:
→ Telangana police launched their own facial recognition facility (2018). MCA’s “DigiYatra” uses facial recognition
system at Hyderabad Airport. NCRB’s Crime and Criminal Tracking Network and Systems (CCTNS) uses automated
facial recognition.
→ NCRB proposal for National Automated Facial Recognition System (AFRS) which would be used to create national
database of photographs which would help in swiftly identifying criminals by gathering existing data from various
other databases like Passport, CCTNS, ICJS, Prisons, WCD Ministry’s KhoyaPaya etc.
→ Initiatives by States: TSCOP + CCTNS in Telangana, Punjab Artificial Intelligence System (PAIS) in Punjab, AFRS in Delhi,
Automated Multimodal Biometric Identification System (AMBIS) in Maharashtra, FaceTagr in Tamil Nadu.
→ NATGRID – one project to create comprehensive and searchable database.
 Countries:
→ Several countries are already using FRT on large scale for ease of internal security and in their criminal justice system
e.g. China.
 Way Forward:
→ Supreme Court judgment ruled that privacy is fundamental right even in public spaces. And if these rights need to be
infringed, then government action should be sanctioned by law, in proportion, and in pursuit of legitimate aim.
→ With right regulation and protections, FRT can make world safer, more convenient and smarter.
Note:
 Neural Networks (NN) / Artificial Neural Networks (ANN) / Neural Nets:
→ Computing systems inspired by biological neural networks that constitute animal brains.
→ One AI tech that attempts to mimic web of neurons in brain to learn and behave like humans.
→ This AI technology is also used for finding match and pattern.
Question:
 In addition to fingerprint scanning, following can be used in biometric identification of person - Iris scanning, Retinal
scanning, Voice recognition.
Mains Link:
 FRT- uses and concerns.
 Do you think the recently proposed automated facial recognition system for improving outcomes in the area of Criminal
identification and verification is opaque, vague and prone to misuse? Critically analyse. (250 words)

Page 282 of 719

 TRADE AGREEMENT / TRADE PACT
News:
 2021:
→ US not interested in US - India bilateral free trade agreement.
→ UK announces launch of Free Trade Agreement (FTA) negotiations with India. [Scotch whisky, financial services,
cutting-edge renewable technology]
 2022:
→ India is in discussion with ASEAN for initiating review of free-trade agreement (FTA) in goods between two regions
to seek more market access for Indian domestic products.
→ FTA provisions to prevail in Rules of Origin disputes: CBIC instructs its officials to follow provisions in FTAs and
associate rules of origin in case of conflict with Customs (Administration of Rules of Origin under Trade Agreements)
Rules, 2020 (CAROTAR, 2020). That is, India will follow provisions of FTAs over wider and more stringent domestic
framework in case of any dispute over value addition or rules of origin related to imports under FTAs. [FTA provisions
are much more liberal than provisions given under CAROTAR].
→ As trade officials from India and UK race to seal FTA talks in some weeks, UK Prime Minister Liz Truss’s new Home
Secretary suggest that she would not back this deal if it involves increased immigration to UK. [Previously Theresa
May in 2016) had said that any increase in visas to Indians would have to co-relate to speed and volume of return of
Indians with no right to remain in UK].
About:
 What:
→ wide-ranging taxes, tariff, trade treaty that often includes investment guarantees.
→ It exists when two or more countries agree on terms that help th em trade with each other.
 Aim:
→ To reduce / eliminate tariffs, quotas, other trade restrictions on items traded between signatories.
 Example:
→ Preferential trade
→ Free trade
 Classification (based on level of economic integration):
→ Trade and Investment Framework Agreement (TIFA)
→ Bilateral Investment Treaty (BIT)
→ Preferential Trade Arrangement (PTA)
→ Free Trade Agreement (FTA):
 What:
• pact between two or more nations to reduce barriers to imports and exports.
• Concept of free trade is opposite of trade protectionism / economic isolationism.
 Origin:
• benefits of free trade were given for 1st time by economist David Ricardo in 1817.
 Feature:
• Under free trade policy, goods and services can be bought and sold across international borders with little
or no government tariffs, quotas, subsidies, prohibitions.
 Coverage:
• FTA normally covers:
 trade in goods (agricultural, industrial products)
 trade in services (banking, construction, trading, etc).
• FTA can also cover:
 intellectual property rights (IPRs)
 investment
 government procurement
 competition policy
 ….
 Argument:
•
{pros} {cons}
Increased economic growth Increased job outsourcing
Lower govt. spending Poor working conditions
Technology transfer Degradation of natural resources
 India:
• India has FTA with number of country (such as UAE, Mauritius, Japan, Singapore etc.).
→ Common market
→ Currency union
→ Customs union
Page 283 of 719
 → Customs and monetary union
→ Economic union
→ Economic and monetary union (EMU)
→ Fiscal Union
 India:
→ India has 42 trade agreements (including preferential agreements)
Note:
 Rules of origin:
→ rules to attribute country of origin to product in order to determine its "economic nationality". Need to establish
rules of origin stems from fact that implementation of trade policy measures, such as tariffs, quotas, trade remedies,
in various cases, depends on country of origin of that product. Rules of origin have become challenging topic in
international trade, not only because they constitute highly technical area of rule-making, but also because their
designation and application have not been harmonized across world. Lack of harmony is even more remarkable in
era of regionalism, when more and more FTAs are concluded, creating spaghetti bowl effect.
→ Rules of origin are criteria needed to determine national source of product. Their importance is derived from fact
that duties and restrictions in several cases depend upon source of imports. E.g. If product originated from UAE was
imported into India, it may invite 0 or concessional import duty; if that product originated from China, substantial
duty may be levied. So importer cannot import goods from China and label them as ‘Made in UAE’ and then export
them to India to avoid customs duty. CAROTAR, 2020 prevents such misuse.
 Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020 (CAROTAR, 2020):
→ It aims to plug duty evasion under FTAs. Under this, importers need to show proof of say 35% value addition in goods
from country of origin to claim duty concession under FTA.
 Early harvest deal:
→ precursor to FTA, in which trading partners reduce tariff barriers on limited goods so as to promote trade.
 Preferential trade agreement (PTA) is sub-set of FTA.
FTA is sub-set of Comprehensive Economic Cooperation Agreement (CECA).
CECA is sub-set of Custom Union.
Custom Union is sub-set of Common Market.
Common Market is sub-set of Economic Market.
 Protectionism / Trade protectionism:
→ Theory or practice of shielding country’s domestic industries from foreign competition by taxing imports. It is
economic policy of restricting imports from other countries through methods such as tariffs on imported goods,
import quotas, and variety of other government regulations. Proponents argue that protectionist policies shield
producers, businesses, and workers of import-competing sector in India from foreign competitors; however, they
also reduce trade and adversely affect consumers in general (by raising cost of imported goods), and harm producers
and workers in export sectors, both in country implementing protectionist policies and in countries protected against.
→ India:
 History of tariff setting in India:
• British Era: Since 1882, Britain had followed policy of complete free trade in India. Indian Fiscal Commission,
1921-22 recommended that custom duty has protective role to play, as initial protection is important to
withstand foreign competition. It recommended establishment of tariff board for grant of protective duties.
1st Tariff Board was appointed in 1923 and it granted protection to iron and steel industry. After
Independence, India tried to follow liberal policy, however, in face of BOP crisis (1957-58), strict import
licensing was adopted. In 1970s, licence-permit raj era was started. In 1991 reform, government eliminated
import licensing.
 Recent: In last 2 decades, there has been trend to reduce customs duty (liberalization). H owever, since
budget 2018-19, GOI changed policy and has since increased customs duty (protectionism) in order to
further incentivise domestic value addition (switched from liberalism to protectionism on account of
its import substitution).
 Current issue: GOI has used custom duties as revenue-raising instrument. But, central principle of public
finance does not allow customs duties to be used as revenue instrument. Increases in customs duties
should be strictly reserved for protection of new industries.
Value Addition:

{Tariff barriers} {Non-tariff barriers}
tax or duty imposed on goods which are traded to/from obstacles to international trade, other than tariffs.
abroad
administrative measures implemented by country’s administrative measures implemented by country’s
government to discourage goods brought in from foreign government to discourage goods brought in from foreign
countries and promote domestically produced items countries and promote domestically produced items
imposed through Taxes, Duties imposed through Regulations, Conditions, Requirements,
Formalities etc.
Page 284 of 719
Mains Link:
 How would the recent phenomena of protectionism and currency manipulations in world trade affect macroeconomic
stability of India?(UPSC 2018).

FISCAL DEFICIT (FD)

News:
 2021:
→ Moody’s Investors Service (Moody’s), USA says India’s public debt is among highest in emerging
economies, and India’s debt affordability is among weakest. [Note: Big 3 Credit rating agencies in world -
Standard & Poor’s (S&P), Fitch Group, Moody’s Investors Service (Moody’s)].
→ Government to borrow about Rs. 5 lakh crore to fund revenue gap [fiscal deficit] for reviving COVID-19 pandemic-hit
economy. [During 1st half of current fiscal year, government had raised about Rs. 7 lakh crore from market by issuing
bonds – dated securities, T-Bills].
 2022:
→ To bring in transparency in State finances, Centre informs States that off-budget borrowings are to be equated with
States' own debt and any such fund raised by State governments in 2020-21 and 2021-22 would need to be adjusted
out of borrowing ceiling this year in 2022.
→ As per RBI study, 5 States - Bihar, Kerala, Punjab, Rajasthan, West Bengal are highly stressed States.
 Reasons for fiscal deterioration:
• Not adhering to targets set by 15th FC i.e. exceede limit set.
• Fall in own State tax revenue.
• Volatile non-tax revenue, dropping significantly in recent years. Decline in non-tax revenue is under general
services, interest receipts, economic services.
• High revenue expenditure.
• High committed expenditure: It includes interest payments, pensions and administrative expenses. High
expenditure leaves limited fiscal space for undertaking developmental expenditure.
• High losses of DISCOMs: After UDAY scheme, losses of DISCOMs were made part of State government
liability. This further worsened their situations.
• Immediate impact of COVID19: It led to high expenditure and low revenue, thus misbalancing State finance.
• Immediate impact of 2022 Russia-Ukraine war: High oil prices have led States to cut duty on Petroleum,
thus further impacting their revenue.
 Steps taken:
• Central government directives: Centre has urged Chief Secretaries of all States to keep check on increasing
debt burden and fiscal deficit because their performance will have huge bearing on India’s economy.
→ Centre relaxes norms for adjusting States' off-budget loans / Off-budget borrowings and says such liabilities of last
fiscal year i.e., 2021-22 can be adjusted against their borrowing ceilings of next 4 years till March 2026. [Considering
magnitude of off-budget borrowing of some States and difficulties expressed by States, Centre decided that off-
budget borrowing done by States up to year 2020-21 may not be adjusted. Further adjustment on account of off-
budget borrowing done by States in 2021-22 is to be done over up to 4 years (2022-23 to 2025-26)].
 Impact: This move can be attributed to deliver resources for States to fund their capital expenditures in current
fiscal year.
 Why: Many States are facing difficulties due to borrowing restriction in current fiscal year because of magnitude
of such loans.
 Expert opinion on this move: India Ratings & Research Chief Economist DK Pant said adjustment of off-budget
borrowing of FY21 and FY22 would have resulted in severe resource crunch for few States. Decision of deferring
adjustment of off-balance sheet borrowing of State where debt servicing is being done through State budget is
good decision. This will help States to focus on their development agenda. Global experience suggests at difficult
times, axe of fiscal consolidation falls on capex and social sector.
→ Finance Minister Nirmala Sitharaman says borrowing by State PSUs or their SPVs will be considered as borrowing by
State government and thereby needing consent from GOI [under Article 293]. Considering effect of bypassing Net
Borrowing Ceiling (NBC) of States by such borrowings, it was decided and communicated to States that borrowings
by State PSUs / corporations, SPVs and other equivalent instruments, where principal and / or interest are to be
serviced out of State Budgets and / or by assignment of taxes / cess or any other State's revenue, shall be considered
as borrowings made by that State.
→ Kerala FM K.N. Balagopal says Central policies are hurting Kerala’s finances. He says financial policies pursued by
Union government such as drop in State’s Central tax share in past few years are pushing Kerala State into serious
financial crisis.
 Background: RBI in one report titled ‘State Finances: A Risk Analysis’ said States’ fiscal positions deteriorated
sharply in 2020 with sharp decline in revenue, increase in spending and sharp rise in debt to GSDP ratios. Based
on debt to GSDP ratio in 2020-21, RBI found debt burden in 10 States including Kerala quite high.

Page 285 of 719

 → GOI launches one scheme – “Scheme for Special Assistance to States for Capital Investment for 2022-23”. Under this
scheme, financial assistance will be provided to State Governments in form of 50-year interest free loan for capital
investment projects.
Constitution:
 Article 292 (Borrowing by the Government of India):
→ Union govt. can borrow upon security of Consolidated Fund of India (CFI) within such limits as fixed by Parliament by
law and to giving of guarantees within such limits, if any, as may be so fixed.
 Article 293 (Borrowing by States):
→ (1) State executive can borrow within territory of India upon security of CFS within such limits as fixed by State
Legislature by law and to giving of guarantees within such limit.
→ (2) GOI may, subject to Parliament’s law, make loans to any State within limits fixed under Article 292, and give
guarantees in respect of loans raised by any State, and sum required for making such loans shall be charged on CFI.
→ (3) State cannot raise loan without consent of GOI if there is still outstanding loan or guarantee made to that State
by GOI.
→ (4) GOI may grant consent to State under clause (3) subject to such conditions as GOI thinks fit to impose.
About:
 What:
→ FD is essentially gap between what government spends and what it earns. That is, FD is borrowings by government.
→ Govt. borrowing is loan taken by government. Govt. borrowing falls under capital receipts in Budget document.
Usually, Govt. borrowing is done through issuance of Government Securities (G-secs), T-Bills.
 Government Budget:
→ 2 important items that are set to equal each other are:
 total expenditure
 total receipts (not total revenue)
That is, total receipts = total expenditure.
→
{Total Receipts}
{Items} {Revenue for Govt.}
Revenue Receipts Tax Revenues Yes
Non-tax Revenues Yes
Capital Receipts Recovered loans Yes
Other Receipts - disinvestment Yes
receipts etc.
Borrowings and Other Liabilities No

→ Hence, total receipt is used rather than total revenue to include borrowing i.e. from table above, borrowing = total
receipt - total revenue. This Borrowing is termed as FD. [FD = Borrowing = total receipt - total revenue].
 Definition 1:
→ According to Govt. Budget document, Fiscal Deficit (FD) is defined as difference between total expenditure and
Revenue Receipts plus Non-debt Capital Receipts (NDCR), where NDCR = Recovered loans + Other Receipts.
Derivation:
 According to budget:
• Total receipts = Total expenditure.
• Revenue Receipts + Capital Receipts = Total expenditure
• Revenue Receipts + Recovered loans + Other Receipts + Borrowings = Total expenditure
• Borrowings = Total expenditure – (Revenue Receipts + Recovered loans + Other Receipts)
• FD = Borrowings = Total expenditure – (Revenue Receipts + Non-debt Capital Receipts [NDCR])
 Note:
• Capital Receipts = Recovered loans + Other Receipts + Borrowings
• Capital Receipts = Non-debt Capital Receipts (NDCR) + Debt Capital Receipts (DCR)
• That is, FD = Borrowings = Debt Capital Receipts (DCR)
 Definition 2:
→ Fiscal Deficit (FD) is excess of total expenditure over total receipts except borrowings. Derivation:
 According to budget:
• Total receipts = Total expenditure
• Total receipts – Borrowings + Borrowings = Total expenditure
• Borrowings = Total expenditure - (Total receipts - borrowings)
• That is, FD = Borrowings = Total expenditure – (Total receipts except borrowings).
 Impact of High FD:
→ Limited investible savings: It means Govt. borrows high amount of money from market leaving lesser amount of
money in market for private entrepreneurs and businesses to borrow. Then, lesser amount of money leads to higher
Page 286 of 719
 interest (lending) rates – which means, investments in infrastructure, assets creation is costly and ultimately
economy may go down.
→ Hurts Govt. / Public finance: High borrowings by Govt. means high interest payment and thus hurts government’s
finances. Thus, public debt goes up i.e. higher debt-to-GDP ratio.
→ RBI: High FD and then high interest mean that RBI’s efforts to reduce interest rates are nullified.
→ Higher levels of FD typically imply government takes money from market, thus leaving less money for private sector
for its own investment needs (crowding out effect).
 Significance:
→ Actually, FD represents government’s total borrowing requirements.
→ FD indicates financial health of budget / government. FD is most important metric to understand financial health of
government finances.
→ FD is essentially amount of money that government has to borrow in any year to fill gap between its expenditures
and revenues. Higher levels of FD typically imply government eats into pool of investible funds in market which could
have been used by private sector for its own investment needs.
 Way Forward:
→ Manageable FD:
 For developing economy like India:
• FD could be higher than developed economy because private enterprises may be weak and government
may be in better position to invest.
• Government should invest in infrastructure, asset creation, even if return revenues from these are nil.
→ India has fiscal management Act - Fiscal Responsibility and Budget Management Act, 2003.
Note:
 Public Debt / Government debt / Sovereign debt:
→ What:
 One country's gross government debt (also called public debt, or sovereign debt) is financial liabilities of
government sector. Changes in government debt over time reflect primarily borrowing due to past government
deficits. Deficit occurs when government's expenditures exceed revenues. Government debt may be owed to
domestic residents, as well as to foreign residents. If owed to foreign residents, that quantity is included in
country's external debt. Ability of government to issue debt has been central to state formation and to state
building. Public debt has been linked to rise of democracy, private financial markets, and modern economic
growth.
 It is total amount borrowed by government of country. In Indian context, public debt includes total liabilities of
GOI that have to be paid from CFI but excludes liabilities that have to be paid from PAI. In accordance with Article
292, GOI describes public debt as those liabilities contracted against CFI.
→ Sources:
 Dated government securities (G-secs), T-Bills, External assistance, Short-term borrowings.
→ Types:
 Internal debt:
• Marketable securities:
 G-secs (issued through auction), T-Bills (issued through auction).
• Non-marketable securities:
 intermediate T-bills (issued to State governments), special securities (issued to National Small Savings
Fund etc.)
 External debt.
 Debt-to-GDP ratio:
→ What:
 In economics, debt-to-GDP ratio is ratio between country's government debt (measured in units of currency)
and its GDP (measured in units of currency per year). Low debt-to-GDP ratio indicates that economy produces
goods and services sufficient to pay back debts without incurring further debt.
 Debt-to-GDP ratio is metric comparing country's public debt to its GDP. By comparing what country owes with
what it produces, debt-to-GDP ratio reliably indicates that particular country’s ability to pay back its debts. Often
expressed as %, this ratio can also be interpreted as number of years needed to pay back debt if GDP is dedicated
entirely to debt repayment.
→ Acceptable level:
 In India, according to 2017 FRBM Review Committee / NK Singh Committee [2016] recommended for total
general govt. Debt-to-GDP ratio of 60% by 2022-23 (40% for central government and 20% for States).
→ When debt-to-GDP ratio widens:
 Each year’s borrowing (or deficit) adds to total debt. Paying back this debt depends on State’s ability to raise
revenues. If State, or all States in aggregate, finds it difficult to raise revenues, rising mountain of debt —
captured in debt-to-GDP ratio — could start vicious cycle. Then, States end up paying more and more towards

Page 287 of 719

 interest payments instead of spending their revenues on creating new assets that provide better education,
health, welfare for their residents.
→ Significance:
 indicates how likely country can pay off its debt.
 Investors often look at Debt-to-GDP metric to assess government’s ability to finance its debt.
 Higher Debt-to-GDP ratios had fueled economic crises worldwide.
→ Way Forward:
 Long-term measures suggested by Central government to State Governments:
• Need to adopt best practices of crop diversification: Discourage more paddy and wheat cultivation, and
focus on pulses, oilseeds.
• Focus on slums redevelopment and cluster development.
• Advance urban planning for Tier II and Tier III cities.
• Urban development along transit corridor.
• Focus on quality of teachers: States were asked to fill vacancies of teachers, train them and equip them with
latest technologies.
 Fiscal Responsibility and Budget Management Act, 2003 / FRBM Act, 2003:
→ What:
 Act to provide for responsibility of Central Government to ensure intergenerational equity in fiscal management
and long-term macro-economic stability by removing fiscal impediments in effective conduct of monetary policy
and prudential debt management consistent with fiscal sustainability through limits on Central Government
borrowings, debt and deficits, greater transparency in fiscal operations of Central Government and conducting
fiscal policy in medium-term framework.
→ Objective:
 To make Central government responsible for ensuring inter-generational equity in fiscal management and long-
term macro-economic stability.
 Transparency in fiscal management systems.
 Fiscal stability
 Flexibility to RBI to deal with inflation.
 Equitable distribution of India’s debt over years.
→ Feature:
 FRBM Act makes mandatory for government to place below statements along with Union Budget in Parliament
annually:
• Medium-term Fiscal Policy Statement.
• Macro-economic Framework Statement.
• Fiscal Policy Strategy Statement.
 As recommended by 2017 FRBM Review committee / NK Singh committee [2016], FRBM Act (2018 Amendment)
has provision for reduction of FD to about 3% of GDP. But there is one escape clause which allows government
to breach its FD target by 0.5% points at times of severe stress in economy such as structural reforms in economy,
growth fall, National security, war etc., National level calamities, Severe collapse of agriculture.
 Fiscal Limits: This Act envisages setting of limits on Central and State government’s debt and deficits. [States
have since enacted their own respective Financial Responsibility Legislation, which sets same 3% of GSDP cap on
their annual budget deficits. Manipur has enacted on - Manipur Fiscal Responsibility and Budget Management
Act, 2005]
 Fiscal Slippage:
→ What:
 In simple terms, it means any deviation (increase) in expenditure from expected expenditure. On larger level, it
means government's expenditure surpasses expected or estimated expenditure level.
 [In comparison to fiscal slippage, Fiscal deficit is broader term].
→ Factor:
 farm loan waivers, cut back on GST collection, reduction in tax and excise, higher crude oil price etc.
→ Impact:
 higher inflation.
→ How to manage:
 Expenditure should be done, as far as possible, in line with planned and judiciously.
 Proceeds should be used for promoting economic sectors, creating jobs, increasing production and
consumption.
 Subsidy should be cut down to judicious level.
 Tax mechanism should not create any kind of fear, while settling their tax dues.
 Finance of State Government / State Government’s Finance / State Finance:
→ Status:

Page 288 of 719

 RBI in one report titled ‘State Finances: A Risk Analysis’ said States’ fiscal positions deteriorated
sharply in 2020 with sharp decline in revenue, increase in spending and sharp rise in debt to GSDP
ratios. Based on debt to GSDP ratio in 2020 -21, RBI found debt burden in 10 States including Kerala
quite high.
This report further said that States like Punjab, Rajasthan, Kerala, West Bengal, Bihar, Andhra
Pradesh, etc. had highest debt burden in 2020 -21. Revenue expenditure of these States constitutes
80-90% of total expenses and therefore they have poor capital spending. Andhra Pradesh, Bihar,
Rajasthan and Punjab exceeded both debt and fiscal deficit targets for 2020 -21 set by 15 th Finance
Commission.
→ Borrowing by States:
 Intro:
• Article 293 has provisions about Borrowing by States.
 Centre’s consent / permission:
• Intro:
 In practice, Centre exercises power given to it by Article 293 in accordance with recommendation of FC.
 Centre’s power to impose condition is unrestricted or not is neither mentioned in Constitution nor exist
in any judicial judgments / orders nor addressed in Terms of Reference, 15th FC.
• When:
 Centre can impose condition only when it gives consent to State for borrowing.
 Centre can give such consent only when State is indebted to Centre.
• Need:
 Protect Centre’s interests as creditor.
 Ensure macro-economic stability of India.
• Concern:
 Misuse: Exercise of conditionality power is sometimes wrongly used by Centre. Example: Requiring
States to join ONOR Card scheme. Instead, Centre should have opted for building consensus instead of
compelling States using loan conditionality.
 Every single State is currently indebted to Centre and thus, all of them require Centre’s consent in order
to borrow.
• Condition imposed by current Union Govt. (Modi Govt.):
 Citizen centric reforms: One Nation One Ration (ONOR) Card System, Ease of doing business, Urban
Local Body /utility (ULB), Power Sector reforms. [Manipur Govt. completed ULB reforms].
• Conclusion:
 Critics argue that, if there is no direct effect on India’s fiscal health or on macro-economic stability, then
Centre should not impose condition for State borrowing, and should not encroach upon legitimate
financial domain of States.
 States do not need prior central consent to guarantee loans and advances, and bonds issued by its entities. Also,
ceiling on guarantees is self-determined and varies from State to State. All these have led to greater reliance on
off-budget borrowings. Centre fixed net borrowing ceiling of States at Rs 8,57,849 crore or 3.5% of GSDP. States
are also eligible for additional borrowing of 0.50% of GSDP linked to reforms in power sector.
→ Assistance to States:
 In 2022, GOI launched one scheme – “Scheme for Special Assistance to States for Capital Investment for 2022-
23”. Under this scheme, financial assistance will be provided to State Governments in form of 50-year interest
free loan for capital investment projects.
 Revenue expenditure:
→ It includes expenses required to meet ongoing operational costs of running government, and thus are essentially
same as operating expenses e.g., rent, employee salary etc.
 Off-budget borrowings:
→ What:
 It refers to loans taken by State government entities, special purpose vehicles, etc, where principal and interest
would be repaid from State government's own budget, instead of cash flows or revenues generated by
borrowing entity. Such borrowings bypass net borrowing ceiling fixed for States in fiscal year by routing loans
outside State budget through government-owned companies or statutory bodies. Since responsibility for
repayment lies with States, it adversely impacts their revenue and fiscal deficit.
→ Rule:
 As per norms, State governments are required to take Centre's approval for fresh borrowing over limit set for
particular financial year.
→ Status:
 As per one study by CRISIL ratings, off-balance sheet borrowings by States are estimated to have reached decadal
high of 4.5% of GDP, or about Rs 7.9 lakh crore, in 2021-22. Over last 2 years, many States resorted to off-budget
borrowing to fund their capital expenditures and minimise impact of economic downturn induced by COVID-19.
 Rise in off-budget borrowings:
Page 289 of 719
 • There are 2 reasons for rise in off-budget borrowings:
 One, constrained revenue growth due to Covid pandemic-induced slowdown and increasing revenue
expenditure have led to States' FDs rising to 4% of GSDP, well above historical level of 2-3% seen for
most part of last decade. This has reduced wherewithal money of States to directly fund entities they
own.
 Two, even if States wanted to do so by borrowing more, they can not without explicit approval of, and
beyond limits set by, Central government.
 But States do not need prior central consent to guarantee loans and advances, and bonds issued by its entities.
Also, ceiling on guarantees is self-determined and varies from State to State. All these have led to greater
reliance on off-budget borrowings. Centre fixed net borrowing ceiling of States at Rs 8,57,849 crore or 3.5% of
GSDP. States are also eligible for additional borrowing of 0.50% of GSDP linked to reforms in power sector.
 Net Borrowing Ceiling (NBC):
→ Decided by GOI at beginning of each financial year. E.g. for FY 2022-23, NBC is 3.5% GSDP (based on 15th FC) + 0.05%
(if State carries out power sector reforms). NK Singh Panel review of FRBM Act has placed debt-to-GDP ratio of 40%
for GOI, 20% for State governments together and FD of 2.5% of GDP, both by financial year 2022-23.
Article 293 deals with borrowing by States government. It says executive power of State extends to borrowing
within territory of India upon security of Consolidated Fund of State. GOI may make loans to any State or give
guarantee, so long as any limits fixed under Article 292 are not exceeded. State may not without consent of GOI raise
any loan if there is still outstanding part of loan.
Question:
 Capital budget of GOI includes:
→ Expenditure on acquisition of assets like roads, buildings, machinery, etc;
→ Loans received from foreign governments;
→ Loans and advances granted to States and Union Territories.
 14th FC, increased share of States in central divisible pool from 32% to 42%.
Value Addition:
 Off-Budget Borrowing:
→ What:
 loan taken not by Centre directly, but by another public institution which borrows on direction of central
government and used to fulfil government’s expenditure needs.
→ Significance:
 Liability of loan is not formally on Centre and thus, this loan is not included in national fiscal deficit. It keeps
country’s fiscal deficit within acceptable limits.
 FD is keenly watched by rating agencies — both inside and outside country and thus off-budget borrowing is
way out.
Mains Link:
 Increasing fiscal deficit of states is a cause of worry and there is a considerable need to focus on state government
finances. Analyse. (15M)
 What is Fiscal Deficit? What are the impacts of Fiscal Deficit on the economy? What are the ways to finance the fiscal
deficit? Suggest steps for fiscal consolidation in the light of the Union Budget proposals (15M)
 Distinguish between Capital Budget and Revenue Budget. Explain the components of both these Budgets. (UPSC 2021)
 Discuss the issues related to financial autonomy of states and how they can be addressed?

MONEY LAUNDERING
News:
 2022:
→ Controversy over series of raids and arrests of politicians, their relatives, and activists under Prevention
of Money Laundering Act, 2002 has made Supreme Court to step in and check misuse of PMLA law.
 Issue: Frequency and timings of said raids and arrests have raised concerns over independence of PMLA and its
agency (ED). Some activists say PMLA and ED are being misused to attack opposition camps with political
embarrassment.
 Petition’s demand: PMLA, 2022 section related to “Offence of money-laundering” has to be read down to say
that mere use and possession of proceeds of crime is not money-laundering.
 Supreme Court: Supreme Court said very concept of offence of money-laundering in PMLA is “very wide”. And,
any activity connected with crime is encompassed within expression of money laundering under PMLA
legislation.
→ ED arrests Delhi Health Minister and senior Aam Aadmi Party (AAP) leader Satyendar Jain under criminal provisions
of Prevention of Money Laundering Act (PMLA) in connection with his alleged involvement in one ‘hawala
transactions’ case.
→ Supreme Court upholds PMLA (2019 Amendment). However, question of enactment of PMLA Amendment through
Money Bill will be decided by larger bench.

Page 290 of 719

 → Supreme Court strikes down two provisions of 1988 Benami law (Benami Transactions (Prohibition) Act, 1988).
Supreme Court terms these provisions ‘unconstitutional’ (violation of Article 20) on ground of being ‘manifestly
arbitrary’. In decision much-awaited by businesses, one 3-judge Bench led by CJI N.V. Ramana, declared as
unconstitutional Section 3(2) and Section 5 introduced through Benami Transactions (Prohibition) Amendment Act,
2016.
 Section 3(2) says whoever enters into any benami transaction shall be punishable with imprisonment for term
which may extend to 3 years or with fine or with both. In detail, section 3(2) mandates 3 years of imprisonment
for those who had entered into benami transactions between September 5, 1988, and October 25, 2016. [That
is, person can be sent behind bars for benami transaction entered into 28 years before this Section even came
into existence. Supreme Court struck it down because it is harsher punishment].
 Section 5 (Property held benami liable to confiscation): Any property, which is subject matter of benami
transaction, shall be liable to be confiscated by Central Government. [Supreme Court struck it down because it
said this provision cannot be applied retrospectively].
→ Supreme Court allows PMLA verdict review: Underlining its support for one law against money laundering, Supreme
Court agrees to reconsider its verdict upholding 2 key provisions of PMLA. And flagged, for reconsideration, issues
that have been criticised as possible violations of due process such as reversal of presumption of innocence and
disclosure of information. However, Solicitor General Tushar Mehta, who appeared for Centre, opposed review and
argued that questions on legal validity of PMLA could have international ramifications for India.
 Said 2 key provisions are:
• Not sharing copy of Enforcement Case Information Report (ECIR) with accused;
• Stringent bail provisions that reverse presumption of innocence of accused (i.e. shifting of burden of proof
of innocence onto accused rather than prosecution).
 Background: One Review petition was filed questioning verdict of Supreme Court bench earlier in 2022. This
verdict had had given government and ED unbridled powers of summons, arrest, and raids and made bail nearly
impossible. It had also shifted burden of proof of innocence onto accused rather than prosecution.
About:
 What:
→ process of concealing origin of money, often obtained from illici t activities - like drug trafficking,
corruption, theft or misappropriation of funds, gambling - by converting it into legitimate source. illegal
process of converting money generated through criminal activities, like drug trafficking, terrorist funding, etc. to
appear to have come from legitimate source. Money from criminal activity is considered ‘dirty’, and laundering
process makes it look clean. process of converting black money into white money.
 Feature:
→ It is crime in many jurisdictions with varying definitions. It is usually key operation of organized crime.
→ Stages of Money Laundering: Placement -> Layering -> Integration. That is, accumulating money from
illegal activities and placing it into financial system. Then, transferring it to hide o rigin of funds. Thereafter,
returning money from money launder to spend.
 Benami:
→ Benami property:
 It is one whose legal owner is different from actual owner. Benami property includes: immovable
assets such as land, flats, house, movable assets such as gold , stocks, mutual fund holdings, bank
deposits etc. If property is sold, then proceeds from sale are also included under Benami property.
→ Benami transaction:
 What:
• Prohibition of Benami Property Transactions Act, 1988 defines it as any transaction in which property is
transferred to one person for consideration paid by another person.
 Initiative:
→ Prevention of Money Laundering Act, 2002 / PMLA, 2002.
Note:
 Prohibition of Benami Property Transactions Act, 1988:
→ What:
 Act to prohibit benami transactions and right to recover property held benami. Its original name was Benami
Transactions (Prohibition) Act, 1988 which was later changed to current name - Prohibition of Benami Property
Transactions Act, 1988 by one section of 2016 amendment. It prohibits certain types of financial transactions.
This Act defines 'benami' transaction as any transaction in which property is transferred to one person for
consideration paid by another person.
Such transactions were feature of Indian economy, usually relating to purchase of property (real
estate), and were thought to contribute to Indian black money problem. This Act bans all benami transactions
and gives government right to recover property held benami without paying any compensation.
Although benami transactions are now illegal, this Act had limited success in curbing them. Updated
versions were therefore passed in 2011 and 2016, seeking to more comprehensively enforce prohibitions.
 Prevention of Money Laundering Act, 2002.
Page 291 of 719
 → What:
 Indian Act to prevent money-laundering and to provide for confiscation of property derived from, or involved
in, money-laundering. PMLA Act was enacted to fight menace of money laundering. It is being implemented by
ED (under Departement of Revenue, Ministry of Finance).
→ Background:
 It was enacted as response to India’s global commitment, including UN Convention Against Illicit Traffic in
Narcotic Drugs and Psychotropic Substances, 1988 (Vienna Convention 1988) to curb menace of money
laundering.
→ Objective:
 To prevent and control money laundering. To confiscate and seize property obtained from laundered money. To
deal with any other issue connected with money laundering in India.
→ Dispute redressal:
 PMLA Adjudicating Authority:
• It is created and its members are appointed by central government. It decides whether property attached
or seized is involved in money laundering. It shall not be bound by procedure laid down by Code of Civil
Procedure,1908, but shall be guided by principles of natural justice and subject to provisions of PMLA.
 PMLA Appellate Tribunal:
• It is created and its members are appointed by central Government. It hear appeals against orders of PMLA
Adjudicating Authority. Its orders can be appealed in appropriate High Court.
 PMLA Court / Special Court:
• PMLA Special court can be established by Union government under PMLA, 2002. One or more Sessions
Court can be designated as Special Court(s) by central government (in consultation with Chief Justice of High
Court) for trial of offence punishable under PMLA, 2002. Appeal against PMLA Court judgment / order can
be directly filed in concerned High Court.
→ Prevention of Money Laundering (Amendment) Act, 2012:
 This 2012 amendment added concept of ‘reporting entity’ which would include banking company, financial
institution, intermediary etc. This 2012 amendment removed upper limit of fine up to Rs 5 lakh levied by PMLA,
2002. It added provision for provisional attachment, confiscation of property of any person involved in money
laundering activities.
→ Prevention of Money Laundering (Amendment) Act, 2019:
 This 2019 Amendment provides extensive power to ED for summons, arrests and raids, and makes bail provisions
difficult while shifting burden of proof of innocence onto accused rather than prosecution.
→ Judiciary:
 In 2022, Supreme Court said very concept of offence of money-laundering in PMLA is “very wide”. And, any
activity connected with crime is encompassed within expression of money laundering under PMLA legislation.
 In 2022, in one case regarding PMLA Amendment 2019, Supreme Court accepts that definition of Money
Laundering includes every aspect of proceeds of crime and not just final act of money laundering. Supreme Court
says Statement recorded before ED will be accepted in court because ED is not police official (and therefore
can’t be challenged on ground of being self-incriminatory). Thus, Enforcement Case Information Report (ECIR)
cannot be equated with FIR of Police (as ECIR is internal document of ED) and therefore directive to share ECIR
with accused can’t be issued.
→ Criticism:
 PMLA law is being used for ordinary crimes. Lack of Transparency and Clarity: Enforcement Case Information
Report (ECIR) – equivalent of FIR – is considered “internal document” and not given to accused person. In 2022,
one petition demanded that PMLA, 2022 section related to “Offence of money-laundering” has to be read down
to say that mere use and possession of proceeds of crime is not money-laundering. In 2022, Supreme Court said
very concept of offence of money-laundering in PMLA is “very wide”. And, any activity connected with crime is
encompassed within expression of money laundering under PMLA legislation.
 UN Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, 1988 / Vienna Convention 1988:
→ This is UN convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances. But it also
includes provisions on money laundering as follows: 1st major initiative in prevention of money laundering;
This convention laid down groundwork for efforts to combat money laundering by obliging member states
to criminalize laundering of money from drug trafficking; It promotes international cooperation in
investigations and makes extradition between member states applicable to m oney laundering; This
convention also establishes principle that domestic bank secrecy provisions should not interfere with
international criminal investigations.
 Enforcement Case Information Report (ECIR):
→ ECIR is 1 st official document recorded by ED before beginning its investigation, similar to what FIR is with
police.
In 2022, in one case regarding PMLA Amendment 2019, Supreme Court said statement recorded before
ED will be accepted in court because ED is not police official (and therefore can’t be cha llenged on ground

Page 292 of 719

 of being self-incriminatory). Thus, ECIR cannot be equated with FIR of Police (as ECIR is internal document
of ED) and therefore directive to share ECIR with accused can’t be issued.
However, later in 2022 itself, Supreme Court agreed to reconsider its verdict upholding this provision
of PMLA (Not sharing copy of ECIR with accused).
Value Addition:
 Financial Intelligence Unit – India (FIU-IND) [2004]:
→ organisation under Department of Revenue, Government of India which collects financial intelligence
about offences under Prevention of Money Laundering Act, 2002. It reports directly to Economic
Intelligence Council (EIC) headed by Finance Minister. independent body. central national agency
responsible for receiving, processing, analysing, and disseminating information relating to suspect
financial transactions.
Question:
 Objectives of PMLA are to prevent and control money laundering, to confiscate and seize property obtained from
laundered money. And to deal with any other issue connected with money laundering in India.
 Property transaction is treated as Benami transaction even if owner of property is not aware of this transaction as basic
principle in Indian legal framework. Properties held by Benami are liable for confiscation by Government and also liable
for confiscation by Government without payment of compensation.
Mains Link:
 Discuss how emerging technologies and globalization contribute to money laundering. Elaborate measures to tackle the
problem of money laundering both at national and international levels. (UPSC 2021)
 Critically examine the efficacy of the Prevention of Money Laundering Act (PMLA) in holding those engaging in money
laundering activities accountable before the law.

WASTE
News:
 2021:
→ WHO releases ‘Children and Digital Dumpsites’ report.
 Findings: About 18 million children, adolescents working at e-waste dumpsites in low-income and middle-
income countries are potentially at risk of severe health hazards, due to discarded electronic devices / e-waste
being dumped from high-income countries.
→ International E-Waste Day observed.
 2022:
→ According to IRENA, India needs firm policy on managing waste that results from used solar panels or from
manufacturing process.
→ Environment ministry releases draft notification to implement extended producer responsibility (EPR) for waste tyre
management.
→ 3 labourers in Mumbai, allegedly hired for manual scavenging, died after inhaling toxic fumes in septic tank.
→ GOI formulates National Action for Mechanised Sanitation Ecosystem / NAMASTE for cleaning sewers, septic tanks.
→ Environment ministry notifies - Guidelines on Extended Producer Responsibility for Plastic Packaging - under Plastic
Waste Management Rules, 2016 via Plastic Waste Management (Amendment) Rules, 2022.
→ Environment Ministry notifies draft notification that says - consumer goods companies and makers of electronics
goods must ensure at least 60% of their electronic waste is collected and recycled by 2023 with targets to increase
them to 70% and 80% in 2024 and 2025, respectively. [These rules bring into effect system of trading in certificates,
like carbon credits, that will allow companies to temporarily bridge shortfalls].
→ GOI proposes one new framework for regulating e-waste in India.
→ Ministry of Social Justice and Empowerment (MoSJ&E) is now preparing to undertake one nationwide survey to
enumerate all people engaged in hazardous cleaning of sewers and septic tanks, activity that has led to at least 351
deaths since 2017. Ministry officials said that enumeration exercise, soon to be conducted across 500 AMRUT cities,
is part of Union government’s National Action for Mechanized Sanitation Ecosystem (NAMASTE) which will
streamline process of rehabilitating sanitation workers and eventually merge with and replace Self-Employment
Scheme for Rehabilitation of Manual Scavengers (SRMS) [2007]. Idea is to also link these sanitation workers to
Swachhta Udyami Yojana, through which workers will be able to own sanitation machines themselves and
government will ensure that at municipality level, work keeps coming in.
→ MoEFCC publishes Battery Waste Management Rules, 2022 to ensure environmentally sound management of waste
batteries.
→ One study released by Pratham Education Foundation (one Indian non-profit NGO) says that most Indian villages do
not have any waste management infrastructure. Public waste bins were observed in only 36% of 700 villages across
15 States that were covered in this study. Just 29% had community waste collection vehicle, while < ½ of villages had
access to sanitation worker or safai karamchari.
→ Union Home and Cooperation Minister, Shri Amit Shah, inaugurates Tehkhand Waste to Energy Plant, which will
generate electricity from the waste of Municipal Corporation of Delhi.

Page 293 of 719

 → NGT slaps 1000s of crores of fines on 7 States (Karnataka, Delhi, Punjab, Maharashtra, Rajasthan, West
Bengal, Telangana), on Supreme Court directions, totalling around Rs. 28,180 crore. NGT equated the
amount of penalty fixed on the States based on “polluter pays principle” to environmental compensation
and the cost of restoration. In some cases, the liability for sewage mismanagement i s higher, while the
legacy waste fine is more in others.
 What will happen to the fine amount?
• NGT expects to revamp sewage treatment plants and waste sites with the amount of fine levied on thse 7
States.
• This money will be used for time-bound sewage and solid waste treatment.
• National Mission for Clean Ganga and Ministry of Housing and Urban Affairs have also been asked to
monitor the fund.
 What next?
• Learning from CAMPA’s mistakes: It was discovered that money under the CAMPA fund was misused and
diverted. Thus with the current penalties awarded by NGT, it is necessary for NGT to specify the purpose for
the fine amount.
• The States will not pay up these fines easily and might approach the Supreme Court over it.
• NGT may impose fines on more States for sewage and solid waste.
• Collecting the fine amount from the States may be a difficult task. [CPCB and the State Pollution Control
Boards had difficulty in collecting fine amount from States].
Constitution:
 Article 243G (Powers, authority and responsibilities of Panchayats):
→ Subject to the provisions of this Constitution, the Legislature of a State may, by law, endow the Panchayats with such
powers and authority as may be necessary to enable them to function as institutions of self-government and such
law may contain provisions for the devolution of powers and responsibilities upon Panchayats at the appropriate
level, subject to such conditions as may be specified therein, with respect to:
 (a) the preparation of plans for economic development and social justice;
 (b) the implementation of schemes for economic development and social justice as may be entrusted to them
including those in relation to the matters listed in the 11th Schedule.
 Article 243W (Powers, authority and responsibilities of Municipalities, etc.):
→ Subject to the provisions of this Constitution, the Legislature of a State may, by law, endow:
 (a) the Municipalities with such powers and authority as may be necessary to enable them to function as
institutions of self-government and such law may contain provisions for the devolution of powers and
responsibilities upon Municipalities, subject to such conditions as may be specified therein, with respect to:
• (i) the preparation of plans for economic development and social justice;
• (ii) the performance of functions and the implementation of schemes as may be entrusted to them including
those in relation to the matters listed in the 12th Schedule;
 (b) the Committees with such powers and authority as may be necessary to enable them to carry out the
responsibilities conferred upon them including those in relation to the matters listed in the 12th Schedule.
About:
 What:
→ Unwanted or unusable materials. Waste is any substance which is discarded after primary use, or is worthless,
defective and of no use. By-product by contrast is joint product of relatively minor economic value. Waste product
may become by-product, joint product or resource through invention that raises waste product's value above 0.
Examples: municipal solid waste (household trash / refuse), hazardous waste, wastewater [such as sewage, which
contains bodily wastes (feces, urine), surface runoff], radioactive waste, etc.
 E-Waste / Electronic Waste:
→ What:
 discarded electrical or electronic devices. old, end-of-life, discarded electrical / electronic appliances, or their
components, consumables, parts, spares. e-waste contains precious metals, metals, gold, copper, mercury,
polycyclic aromatic hydrocarbons etc. Electronic scrap components, such as CPUs, contain potentially harmful
materials such as lead, cadmium, beryllium, brominated flame retardants. E-Waste refers to all items of
electronic and electrical equipment (EEE) and its parts that have been discarded by their owner as waste without
intent of re-use.
→ Elements:
 Lead, Mercury, Cadmium, Chromium, ..
→ Feature:
 It is categorized into 21 types under 2 broad categories: Information technology and communication equipment;
and Consumer electrical and electronics.
→ Status:
 A survey report on E-waste conducted by WEEE Forum says that:

Page 294 of 719

 • 1 out of every 6 electronic products in an average European household is hoarded. Roughly 5.3 billion mobile
/ smartphones will drop out of use in 2022. The electronics would reach a height of around 50,000 km if
stacked flat and on top of each other. Mobile phones / smartphones have valuable gold, copper, silver,
palladium and other recyclable components.
→ E-waste generation in world:
 About 50 MT per year of e-waste generates in world. rapidly increasing across globe. Only about 17% of this e-
waste generated is processed in formal recycling facilities. Rest is usually dumped in low-income or middle-
income countries for illegal processing by informal workers. likely to increase in coming years because of
increase in number of smartphones, computers, electronics, shorter product lifecycles, limited repair options
→ Concern:
 human health effects (lung cancer, respiratory problems, bronchitis, brain damages). environmental pollution
(contamination of groundwater, acidification of soil). E-waste processing is done in low-income countries, which
do not have proper safeguarding regulation, and this makes processing even more dangerous. Children are
especially preferred at e-waste / digital dumpsites because of their small and skill hands. Women, including
pregnant women, also work at e-waste / digital dumpsites, and thus exposure to toxins, which can lead to
premature births, stillbirths. Hazardous impact of e-waste / digital dumpsites on nearby locality, families,
communities. Informal processing of e-waste in developing countries because this can lead to adverse human
health effects and environmental pollution. Recycling and disposal of e-waste may involve significant risk to
health of workers and their communities.
→ Benefit:
 E-waste contains many valuable and critical raw materials that are important for producing new
electrical equipment and other products.
→ Initiatives:
 Basel Convention [1989]:
• Control of Trans-boundary Movement of Hazardous Waste. international treaty to reduce movements of
hazardous waste between nations, and specifically to prevent transfer of hazardous waste from developed
to less developed countries (LDCs). Mobile Phone Partnership Initiative (MPPI) was adopted by Basel
Convention.
• Significance: Basel Convention addressed e-waste issues via environmentally sound management,
prevention of illegal traffic to developing countries, building capacity around globe to better manage e-
waste.
 Rotterdam Convention [2004]:
• to promote exchange of information among Parties over potentially hazardous chemicals (pesticides,
industrial chemicals etc) that may be exported or imported.
• In 2022, 18 th meeting of Chemical Review Committee of Rotterdam Convention took place.
→ Solar waste:
 electronic waste generated by discarded solar panels. According to IRENA, it is estimated that global
photovoltaic waste will touch about 78 million tonnes by 2050. And, India expected to be one of top 5
photovoltaic-waste creators. India currently considers solar waste as part of electronic waste and does
not account for it separately.
→ India:
 Status:
• According to Central Pollution Control Board (CPCB), India generates about 10 lakh tonnes of e-waste
annually. E-waste dismantling capacity is lower than this generated amount. According to Global E-waste
Monitor 2020, India is 3rd largest e-waste generator in world after China, USA. One of fastest-growing waste
streams in world. 95% of e-waste in India is recycled by informal sector.
 Law:
• Laws to manage e-waste have been in place in India since 2011, mandating that only authorized dismantlers
and recyclers collect e-waste.
 Concern:
• In 2018, Ministry of Environment says 95% of e-waste in India is recycled by informal sector and scrap
dealers unscientifically dispose of it by burning or dissolving it in acids.
 Management of e-waste in India:
• Environment (Protection) Act, 1986
• E-waste (Management and Handling) Rules, 2011:
 This rule mandates that only authorised dismantlers, recyclers shall collect e-waste. It established EPR,
but it did not set collection targets.
• E-waste (Management) Rules, 2016:
 Manufacturer, refurbisher, dealer, and Producer Responsibility Organization (PRO) were brought under
ambit of these Rules. notified by Ministry of Environment, Forest and Climate Change, in supersession
of aforesaid E-waste (Management and Handling) Rules, 2011. It includes Compact Fluorescent Lamp

Page 295 of 719

 (CFL), other mercury containing lamps etc. Producers are made responsible for collection of E-waste
and for its exchange. For 1st time, it brought producers under Extended Producer Responsibility (EPR),
along with targets. Role of State Governments is introduced to ensure safety, health and skill
development of workers involved in dismantling and recycling operations. Penalty for violation of rules
is introduced. Urban Local Bodies (Municipal Committee / Council / Corporation) are assigned duty to
collect and channelize orphan products to authorized dismantlers or recyclers. Allocation of proper
space to existing and upcoming industrial units for e-waste dismantling and recycling.
• E- Waste (Management) Amendment Rules, 2018: To further formalize sectors by channelizing e-waste
generated towards authorized dismantlers and recyclers.
• e-waste clinic:
 It enables segregation, processing and disposal of electronic waste from both household and
commercial units. India’s 1st e-waste clinic was set-up in Bhopal, MP.
 NGT’s Directions on E-waste:
• Scientific enforcement of E-Waste Rules, 2016. Compliance with requirement to reduce use of hazardous
substances in manufacture of electrical and electronic equipment. Constant vigil and attention to hotspots
where maximum accidents are happening due to unscientific handling of e-waste. SPCBs need to identify
hotspots and to coordinate with District Administration at local levels.
 Way Forward:
• Policy measures to improve recycling capacity of E-waste:
 Need for E-waste Legislation that incentivizes collection and disposal: India has Deposit Refund Scheme
(DRS) wherein producer charges additional amount as deposit from consumers which will be returned
to consumer along with interest when end-of-life electrical and electronic equipment is returned.
However, lack of awareness of consumers and non-strict enforcement of measures has led to DRS
schemes not being successful. Here, Swiss model of E-waste management can be used;
 Data collection of E-waste: Data on quantities and flows of e-waste can help in monitoring, controlling,
and incentivizing establishment of recycling units at local level which will help kick start formal e-waste
economy. Value of raw materials in global e-waste generated in 2019 is equal to approximately USD 57
billion;
 Public awareness on E-waste economy: Apart from environmental and health benefits of recycling,
consumers can earn by using schemes like DRS. Need to take support of NGOs, community
organizations, RWAs, etc. MeitY, under digital India, from 2016, is creating awareness about safe
disposal and hazards of informal recycling;
 Realizing potential of Circular economy: Improving end-of-life of e-waste through circular economy.
Sharing, leasing, reusing, repairing, refurbishing, and recycling existing materials and products can
extend life cycle of products. Reduce virgin material usage. Build technologies around greater
extraction and recycling capabilities. Process design to find alternative to existing materials and to not
extract rare earth resources. Right to Repair standards (EU) which says from 2021 firms will have to
make appliances longer-lasting and will have to supply spare parts for machines for up to 10 years;
 Integration of informal recycling with formal recycling: Setting up recycling units in each hotspot of e-
waste and by including informal collection system, comprising of Kabadiwalas and scrap dealers, with
formal recycling system through employing them, training them in proper e-waste collection.
 Conclusion:
• Recent government data shows that E-waste recycling has doubled in India from rate of 10% in 2017-18 to
20% in 2018-19. What is needed is one sound market-based incentive that encourages both demand and
supply-side factors to voluntarily adopt e-waste recycling. In this respect, e-waste clinic at Bhopal is one
pilot project wherein e-waste will be collected door-to-door or could be deposited directly at clinic in
exchange for fee.
 Plastic Waste [see under Plastic topic].
 Sewage and Solid Waste:
→ Handling of sewage and solid waste fines is covered in the 11th Schedule of Constitution (‘Health and sanitation’,
‘Maintenance of community assets’ are matters listed in 11th schedule and devolution of power w.r.t. which is given
to Panchayats under Article 243G) and 12th schedule of Constitution (‘Public health, sanitation conservancy and solid
waste management’ is matter listed in 12th schedule and devolution of power w.r.t. which is given to Municipalities
under Article 243W).
→ In 2022, NGT stated that it was the constitutional responsibility of States and local municipal bodies to provide a
pollution-free environment to the people. The State and local municipal bodies should collect funds for this. It was
the state’s responsibility to ensure the right to life. In such a situation, lack of funds cannot be an excuse, it said.
 Waste Management:
→ Extended Producer Responsibility (EPR):
 What:
• According to Min. of Environment’s Plastic Waste Management (Amendment) Rules, 2022, EPR means
responsibility of producer for environmentally sound management of product until end of its life. policy
Page 296 of 719
 approach under which producers are given significant responsibility – financial / physical for treatment or
disposal of post-consumer products. strategy to add all of environmental costs associated with product
throughout product life cycle to market price of that product.
 Origin:
• India 1st introduced EPR in 2011 under Plastic Waste (Management and Handling) Rules, 2011 and E-Waste
Management and Handling Rules, 2011.
 Significance:
• It helps advance circular economy. decreases environmental impact from product and its packaging.
promotes principle of “polluter pays” by holding producer accountable for entire lifecycle of product.
 Status:
→ As of 2022, mountains of garbage are gradually decreasing, many plants have been set up for waste disposal, the
gutter system has been streamlined and a scientific network has also been established for collection of waste across
India.
Note:
 Manual Scavenging:
→ What:
 Term used mainly in India for manually cleaning, carrying, disposing of, or otherwise handling, human excreta in
insanitary latrine or in open drain or sewer or in septic tank or pit. Manual scavengers usually use hand tools
such as buckets, brooms, shovels. They have to move excreta, using brooms and tin plates, into baskets, which
they carry to disposal locations sometimes several kilometers away. These sanitation workers / manual
scavengers rarely have any personal protective equipment. This work is regarded as dehumanizing practice.
Practice of employing human labour for cleaning of sewers and septic tanks is also prevalent in Bangladesh and
Pakistan.
→ Measure:
 India banned this practice under Prohibition of Employment as Manual Scavengers and theirRehabilitation Act,
2013 / PEMSR, Act, 2013. This Act recognizes manual scavenging as dehumanizing practice” and cites need to
correct historical injustice and indignity suffered by manual scavengers.
 In 1989, Prevention of Atrocities Act i.e. Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act,
1989 became integrated guard for sanitation workers. About 90% people employed as manual scavengers
belonged to Scheduled Caste. This Act became important landmark to free manual scavengers from designated
traditional occupations.
 Safaimitra Suraksha Challenge [2020]: It was launched by Ministry of Housing and Urban Affairs on World Toilet
Day (19th November) in 2020.
 Swachhta Abhiyan App: It is developed to identify and geotag data of insanitary latrines and manual scavengers
so that insanitary latrines can be replaced with sanitary latrines and rehabilitate all manual scavengers to provide
dignity of life to them.
 In 2014, one Supreme Court’s order made it mandatory for government to identify all those who died in sewage
work since 1993 and provide Rs. 10 lakh each as compensation to their families.
→ Issue:
 Even though manual scavenging is banned in India, this practice is still prevalent in many parts of India. Reason:
Lack of enforcement of 2013 Act; Exploitation of unskilled labourers; This practice is driven by caste, class,
income divides.
→ Way Forward:
 Article 21 guarantees ‘Right to Life’ and that also with dignity. This right is available to both citizens and non-
citizens. Banned Manual Scavenging should, therefore, be implemented in letter and spirit.
 2020 Extended producer responsibility (EPR) for waste tyre management [Environment Ministry]:
→ This EPR extension requires manufacturers and importers of tyres to also handle their disposal after consumers have
used them.
→ Need: India is world’s 3rd largest producer and 4th largest consumer of natural rubber. Within India, automobile
industry is largest consumer of natural rubber. With growth of automobile industry, consumption of natural rubber
will increase. Chintan (one environmental research and action group) reported in 2017 that by 2035, there will be
around 80 million passenger vehicles and 235 million two wheelers on roads. Pollution from automobile sources is
big concern.
 National Action for Mechanised Sanitation Ecosystem (NAMASTE) [2022]:
→ What:
 One Central Sector Scheme of MoSJE as joint initiative of MoSJE and MoHUA. NAMASTE envisages safety and
dignity of sanitation workers in urban India by creating one enabling ecosystem that recognizes sanitation
workers as one of key contributors in operations and maintenance of sanitation infrastructure thereby providing
sustainable livelihood and enhancing their occupational safety through capacity building and improved access
to safety gear and machines. It will streamline process of rehabilitating sanitation workers and eventually merge
with and replace Self-Employment Scheme for Rehabilitation of Manual Scavengers (SRMS) [2007].
→ Aim:
Page 297 of 719
  Ensure safety and dignity of sanitation workers in urban India and providing sustainable livelihood and enhancing
their occupational safety through capacity building and improved access to safety gear and machines.
 Providing access to alternative livelihoods support and entitlements to reduce vulnerabilities of sanitation
workers and enable them to access self-employment and skilled wage employment opportunities and break
intergenerationality in sanitation work.
 Bring about behavior change amongst citizens towards sanitation workers and enhance demand for safe
sanitation services.
 Zero fatalities in sanitation work in India. All sanitation work is performed by skilled workers. No sanitation
workers come in direct contact with human faecal matter. Sanitation workers are collectivized into SHGs and
are empowered to run sanitation enterprises. All Sewer and Septic tank sanitation workers (SSWs) have access
to alternative livelihoods. Strengthened supervisory and monitoring systems at national, State and ULB levels to
ensure enforcement and monitoring of safe sanitation work. Increased awareness amongst sanitation services
seekers (individuals, institutions) to seek services from registered and skilled sanitation workers.
→ Feature:
 Nodal Ministries: Min. of Jal Shakti, MoSJE, MoHUA.
 It will replace previous scheme: Self Employment Scheme for Rehabilitation of Manual Scavengers (SRMS).
 Skill Development and training of Safai Mitras are being taken up with support of MoSJE through National Safai
Karamcharis Finance & Development Corporation (NSKFDC).
 Capital subsidies of up to Rs. 5 lakh on sanitation machinery costing up to Rs. 15 lakh and interest subsidies on
loans, where interest rates will be capped between 4-6% for beneficiaries, with government taking care of rest
of interest. Provides for training workers in use of these machines, during which time stipend of up to Rs. 3,000
per month will be provided.
 Scheme will also provide for sanitation workers to train for and go into any of approved list of alternative
occupations in sectors like agriculture, services, electronics assembling, handicrafts etc.
→ Note:
 There is also NAMASTE Portal (under Ministry of Ayush) to standardize various terms and technologies used in
alternative medicines.
 Swachhta Udyami Yojana [2014]:
→ It extends financial assistance for Construction, Operation and Maintenance of Pay and Use Community Toilets in
PPP Mode and Procurement and Operation of Sanitation related Vehicles. Ministry of Social Justice and
Empowerment launched it.
 Amount of gold recovered from 1 T of e-waste from personal computers is more than that recovered from 17 T of gold
ore.
 Battery Waste Management Rules, 2022:
→ What:
 In MoEFCC published this rule to ensure environmentally sound management of waste batteries. This rule
replaces Batteries (Management and Handling) Rules, 2001.
→ Feature:
 Batteries covered under 2022 rules: Electric Vehicle batteries, Portable batteries, Automotive batteries,
Industrial batteries.
 EPR: Producers (including importers) of batteries are responsible for collection and recycling / refurbishment of
waste batteries and use of recovered materials from waste into new batteries.
 Centralized online portal: For exchange of EPR certificates between producers and recyclers / refurbishers to
fulfil obligations of producers.
 Industries and entrepreneurship: Setting up of new industries and entrepreneurship in collection and recycling
/ refurbishment of waste batteries.
 Mandatory minimum % of recovery of materials from waste batteries: It will bring new technologies and
investment in recycling and refurbishment industry and create new business opportunities.
 Use of certain amount of recycled materials for new batteries: It will reduce dependency on new raw materials
and save natural resources.
 Online registration & reporting, auditing along with one committee to monitor and implement rules and to take
measures required for removal of difficulties.
 Polluter Pays Principle: Environmental compensation will be imposed for non-fulfilment of EPR targets,
responsibilities and obligations set out in these rules.
 Utilization of funds: Funds collected under environmental compensation shall be utilized in collection and
refurbishing or recycling of uncollected and non-recycled waste batteries.
 International E-Waste Day [2018]:
→ It was developed in 2018 by the WEEE Forum to raise the public profile of WEEE recycling and encourage consumers
to recycle their WEEE with the resulting increase in WEEE recycling rates on the day itself and into the future. It is
held on October 14 every year as an opportunity to reflect on the impacts of e-waste.
→ International E-Waste Day 2022:

Page 298 of 719

  Slogan: ‘Recycle it all, no matter how small!’. Focus is on hoarding of small, unused, dead or broken plug-in and
battery-operated products.
 WEEE Forum [2002]:
→ It is an international association of 46 e-waste producer responsibility organisations. It is the world's largest multi-
national centre of competence as regards operational know-how concerning the management of waste electrical
and electronic equipment (‘WEEE’). It is a not-for-profit association of 46 WEEE producer responsibility organisations
across the world and was founded in 2002. Through exchange of best practice and access to its reputable knowledge
base toolbox, the WEEE Forum enables its members to improve their operations and be known as promoters of the
circular economy.
 Waste to Wealth Mission:
→ It is one of the 9 scientific missions of the Prime Minister’s Science, Technology, and Innovation Advisory Council
(PM-STIAC). It aims to identify, develop, and deploy technologies to treat waste to generate energy, recycle
materials, and extract resources of value.
 Polluter pays principle:
→ In environmental law, the polluter pays principle is enacted to make the party responsible for producing pollution
responsible for paying for the damage done to the natural environment. It is regarded as a regional custom because
of the strong support it has received in OECD and EU countries. It is a fundamental principle in US environmental
law.
→ The ‘polluter pays’ principle is the commonly accepted practice that those who produce pollution should bear the
costs of managing it to prevent damage to human health or the environment.
 Almitra H. Patel vs Union of India (2000):
→ It was a case in Supreme Court regarding the scientific treatment and management of solid waste and sewage.
Supreme Court passed comprehensive orders in 2000 and 2004 over handling waste, but the States did not follow
through. Then Supreme Court referred the case to the NGT in 2014, saying the tribunal had expertise in the matter.
Glossary:
 Producer Responsibility Organization (PRO):
→ PROs are professional organizations financed by producers with responsibility for collection and channelization of e-
waste generated from their products to ensure environmentally sound management.
Value Addition:
 White goods:
→ large home appliances - stoves, refrigerators, freezers, washing machines, tumb le driers, dishwashers, air
conditioners. large electrical goods for house which were traditionally available only in white color. Today,
they are available in wide range of different colors, but they continue being called - white goods.
 Brown goods:
→ Lighter electronic consumer durables - computers, digital media players, TVs, radios etc.
Question:
 Due to improper / indiscriminate disposal of old and used computers or their parts, following items are released into
environment as e-waste: Beryllium, Cadmium, Chromium, Mercury, Lead. Heptachlor is one organochlorine compound
that was used as insecticide. Plutonium is radioactive metallic element with atomic number 94 and is not e-waste.
Mains Link:
 The Electronic waste, or e-waste, is one of the fastest-growing waste streams worldwide. Discuss the measures that are
needed for the safe disposal of e-waste in the country. (250 Words)
 Critically analyze the battery waste management Rules, 2022.

PAYMENT
News:
 2020:
→ RBI issues guidelines that merchants will not be allowed to save card information (card number, CVV, expiry date
etc.) [so as to boost data security]. Also, online players (Amazon, flipkart, Zomato etc.) must delete any credit and
debit card data stored on their platforms and replace them with token to secure card details of consumers.
→ In Budget 2020-21, centre presents 0 Merchant Discount Rate (MDR).
 2021:
→ Cabinet approves scheme to provide incentives for transactions done through RuPay Debit Card, BHIM UPI. [Centre
will reimburse transaction charges of merchant discount rate (MDR)].
→ RBI extends scope of ‘tokenisation’ to several consumer devices - laptops, desktops, wristwatches, Internet of Things
devices, mobiles, tablets etc.
→ NPCI refuses to ban cryptocurrency transactions and instead gave banks choice whether to ban or not.
 Reason:
• NPCI’s decision is based on 2020 Supreme Court’s Judgment that set aside RBI’s directive to ban banks and
financial companies from dealing with virtual currencies or providing services to facilitate trading in
cryptocurrencies.

Page 299 of 719

 • And, following said 2020 Supreme Court’s judgment, RBI has not come out with any directive about
cyrptocurreny.
→ Bhutan becomes 1st country to adopt India’s UPI standards, for its quick response (QR) code.
 Note: Bhutan is 2nd country, after Singapore, to have BHIM-UPI acceptance at merchant locations. Bhutan will
also issue and accept RuPay cards.
→ UPI facility will be extended to feature phone users.
 Reason: RBI is doing this to further deepen digital payments, make digital payments more inclusive, ease
transactions for consumers, facilitate greater participation of retail customers in various segments of financial
markets, enhance capacity of service providers.
 2022:
→ RBI notifies framework for facilitating small-value digital payments in offline mode [It would promote digital
payments in semi-urban, rural areas].
→ NPCI announces that Nepal will be 1st foreign country to adopt India’s UPI system.
→ RBI launches one new UPI payments solution for feature phone users and called ‘UPI123Pay’.
→ WhatsApp (Meta’s instant messaging app) receives clearance from NPCI to add 60 million users to its UPI-based
payments service - WhatsApp Pay.
→ RBI says all merchants must delete customer debit and credit card data and replace card payments with unique
tokens for all online, POS, and in-app transactions. [By September 30, all credit and debit card information used for
online, in-app and point-of-sale (POS) transactions must be replaced with distinct tokens, according to RBI].
→ RBI governor asks for regulation of Bigtech and Fintech companies. For this, with aim to provide secure and affordable
e-payments, RBI comes up with one document ‘Payments Vision 2025’.
→ RBI to introduce Card-on-File Tokenisation (CoFT).
→ One monthly Reserve Bank of India – Digital Payments Index (RBI-DPI) data demonstrates significant growth,
indicating rapid adoption and deepening of digital payments across India.
→ RBI allows BBPS to process cross-border inbound bill payments aimed at benefiting senior citizens and families of
persons who are dependent on remittances from abroad. Till now, BBPS was accessible only to residents in India.
→ NPCI International Payments Ltd. partners with UK’s PayXpert, indicating that UPI expands further globally; Indian
travellers to UK to enjoy hassle-free digital transactions. That is, expanding further outside India, indigenously
developed real-time payments solution UPI will enter into UK market starting with QR code-based transactions. [UK
will be 8th country where UPI-based services will be made available. UAE, Japan, US, Singapore, Bhutan, Nepal, France
are already accepting UPI-based payment services.]
→ RBI comes out with one discussion paper titled - Discussion Paper on Charges in Payment Systems - seeking
stakeholder views on charges in payment systems.
→ UIDAI introduces one new security layer in Aadhaar-enabled Payment System (AePS). Called “liveliness” of
fingerprints, feature is intended to prevent use of fake fingerprints to fraudulently withdraw money through AePS.
→ RBI signals that it would not extend 1 October 2022, deadline for implementation for tokenisation of card based
payments. RBI Deputy governor T Rabi Sankar told reporters that RBI would not hold back innovation because some
few stakeholders weren’t prepared for implementation.
About:
 Tokenisation:
→ What:
 Tokenization, in context of data security, is process of substituting sensitive data element with non-sensitive
equivalent, referred to as token, that has no extrinsic or exploitable meaning or value. Token is reference (i.e.
identifier) that maps back to sensitive data through tokenization system. Mapping from original data to token
uses methods that render tokens infeasible to reverse in absence of tokenization system, for example using
tokens created from random numbers. Tokenization system must be secured and validated using security best
practices applicable to sensitive data protection, secure storage, audit, authentication and authorization.
Tokenization system provides data processing applications with authority and interfaces to request tokens, or
detokenize back to sensitive data. replacement of actual card details (debit card, credit card etc.) with code
called “token”. Token is unique for combination of card, token requestor and device. Instead of card’s details,
token will act as card at point of sale (POS) terminals, quick response (QR) code payment systems. This is not
new concept. It already exists in India – UPI uses.
Tokenization is one process by which card details are replaced by unique code or token, allowing online
purchases to go through without exposing sensitive card details.
→ Goal:
 improve safety and security of payments.
→ Feature:
 It is only for domestic transactions (not international). RBI tells merchants to create ‘token reference number’.
Only this token reference number will be stored by merchants.
→ Steps:

Page 300 of 719

  Token provisioning: Consumer’s card number should be convertible into token, which means card networks have
to be ready with relevant infrastructure. Token processing: Consumers should be able to complete their
transaction successfully through tokens. Multiple use: Consumers should be able to use token for things like
refunds, EMIs, recurring payments, offers, promotions, guest checkouts etc.
→ Benefits:
 Enhanced safety and security as tokens generated on a card will be unique to a single card at a specific merchant.
 Quicker checkouts.
 No more ‘False Declines’ since the usage of tokens for payments confirms the security of the highest order.
 Easy card management.
 No need for a physical card as one can have a virtual version of the card on their smartphone.
→ Challenges:
 Merchants argue that systems at their backend are not yet ready to adopt this RBI new regime and had sought
further time. [Most leading banks - SBI, HDFC Bank, ICICI Bank are ready for switchover]. If implemented in
present state of readiness, this RBI new mandate could cause major disruptions and loss of revenue, especially
for merchants. Disruptions of this nature erode trust in digital payments and reverses consumer habits back
towards cash-based payments. Many users are not aware of it.
→ Significance:
 tokenised card transaction is safer because actual card details are not shared with merchant during transaction
processing. Reduce data theft, date fraud. Tokenised card can be alternative to cumbersome exercise where
customers have to put / type in their name, card number, expiry date, CVV each time they order something
online.
 Tokenization is supposed to improve users' experience with digital payments by providing an additional layer of
protection.
→ India:
 Tokenisation of card based payments:
• RBI allowed card networks like Visa, Mastercard, Rupay to issue token. RBI rules require all merchants to
delete customer debit and credit card details before 1 October 2022 and replace card payments with unique
tokens. This rule is applicable to all stakeholders except card issuers, and card networks. Under these rules,
RBI has permitted authorized card payment networks to offer card tokenization services to consumers
requesting it.
 Currently, card tokenization is not mandatory and customers who don’t tokenize their cards have to enter their
card details manually every time they have to make a transaction from Oct 1, 2022.
 Bigtech and Fintech companies:
→ Need for their regulation:
 To avoid systemic concerns: Big Tech’s play in lending activities using customer data and sophisticated
algorithms can lead to “systemic concerns” like over-leverage and inadequate quality assessment of borrowers.
 Entry of firms like Google, Amazon, Meta, which are referred to as Big Tech, also poses concerns related to
competition, data sharing, data protection, and operational resilience of critical services in situations where
banks and NBFCs utilise their services. Risks relating to cybersecurity, software development limitations in
transaction capacity, privacy of customer data and data security.
 2021 Financial Stability Report had raised some broad concerns, including about such companies’ products
accepting deposits for some regulated financial sector entities.
 Sensitive user data: Big-tech and fintech companies offer sophisticated services which use sensitive data from
various sources to issue loans to users, including those not having collateral or credit history.
 Issues of lending through digital channels, including mobile apps: Issues related to unfair practices, data privacy,
documentation, transparency, and breach of licensing conditions.
 Multiple regulators: Fintechs’ require multiple regulators to work together because single technology like
blockchain or de-centralised finance (DeFi) can have multiple uses coming under different watchdogs’ ambit.
 Anonymity: DeFi poses unique challenges to regulators as it is anonymous. Lack of centralised governance body
and legal uncertainties can make traditional approach to regulation somewhat ineffective.
→ Remedy:
 Authorities and regulators have to strike fine balance between enabling innovation and preventing systemic
risks.
 Guidelines: RBI will soon be issuing guidelines to make digital lending ecosystems “safe and sound while
enhancing customer protection and encouraging innovation”.
 Need for entity-based and outcome-based regulation.
 Globally coordinated regulatory approach and inter-regulatory coordination: This will enable comprehensive
assessment of such activities, and mitigation of risks.
 Use of technology: Use of AI and machine learning to determine creditworthiness of borrower.
 Transparency: Methodology of algorithms underpinning digital financial services has to be “clear, transparent,
explainable and free from exclusionary biases”.

Page 301 of 719

  In age of technological changes, banks should not just work like banking service firms but like technology
companies.
 Digital Payment / Electronic Payment:
→ What:
 transfer of value from one payment account to another payment ac count using digital device [mobile
phone, POS (Point of Sales), computer, digital channel communications - mobile wireless data, SWIFT
(Society for Worldwide Interbank Financial Telecommunication)].
→ Coverage:
 bank transfers, mobile money, payment cards - credit, debit, prepaid cards.
→ Evolution (India):
 Its evolution was steered by RBI. In 2004, RBI launched Real Time Gross Settlement (RTGS) System. In
2005, RBI introduced National Electronic Funds Transfer (NEFT) to support retail payments. Time
Bound Settlements: SEBI uses T+1 settlement (T for transaction date).
→ Digital payment in offline mode / Offline E-payment / Offline digital payment:
 It does not require Internet or telecom connectivity. It can be carried out face -to-face (proximity
mode) using any channel or instrument like cards, wallets, mobile devices. These transactions do not
need Additional Factor of Authentication. Alerts (SMS, e -mail) will be received by customer after time
lag [because transactions are offline]. Curr ently, there is limit of Rs. 200 per transaction, overall limit
of Rs. 2,000 until balance in account is replenished.
→ Initiative:
 2016 Ratan Watal Panel / Committee on Digital Payment:
• Set up separate, independent payments regulator within RBI framework. Revisit Payment and Settlement
Systems Act, 2007 to include consumer protection, data security, privacy. Prominent role for Aadhaar,
including Aadhaar usage as primary identification, for KYC purposes etc. Operate RTGS, NEFT systems on
24/7 basis. Interoperability between banks and payment service providers based on mobile number,
Aadhaar. Systematically important payment service providers should be regulated by RBI. Create fund to
promote digital transactions. All government payments should be made digitally. Cash handling charges
should be levied by Govt.
 Reserve Bank of India – Digital Payments Index (RBI-DPI) [2021].
 RBI created one Payments Infrastructure Development Fund (PIDF) to encourage acquirers to deploy
Points of Sale (PoS) infrastructure — both physical and digital modes — in tier-3 to tier-6 centres and
NE States.
→ Significance:
 Indian digital payment industry is expected to reach USD 1 trillion by 2023.
Note:
 National Payments Corporation of India (NPCI) [2008]:
→ What:
 NPCI is specialised division of RBI which is under jurisdiction of Ministry of Finance. It was created by RBI for
operating retail payments and settlement systems in India. umbrella body for operation of retail payments and
settlement system in India. Initiative of RBI, along with Indian Bank’s Association (IBA). established
under Payment and Settlement Systems Act, 2007. presently, NPCI is promoted by 10 major promoter banks.
NPCI is umbrella organization for all retail payments systems in India. It was set up with guidance and
support of RBI and IBA. NPCI has 10 promoter banks.
→ Payment systems of NPCI:
 National Financial Switch (NFS). Immediate Payment System (IMPS). debit cards / prepaid cards (RuPay Cards
etc.) issued by banks. credit cards issued by NBFCs or any other entity approved by RBI. National Automatic
Clearing House (NACH). Aadhaar Enabled Payments System (AEPS). Cheque Truncation System (CTS).
→ Products of NPCI:
 Applications under NPCI: RuPay, IMPS, NACH, Aadhaar Payment Bridge (APB) System, Aadhaar enabled Payment
System (AePS), National Financial Switch (NFS), UPI, Bharat Bill Payment System, National Electronic Toll
Collection (NETC) program. National Common Mobility Card (NCMC).
 Unified Payments Interface (UPI) [2016]:
• Instant / immediate real-time payment system, allowing users to transfer money on real-time basis, across
multiple bank accounts without revealing details of one’s bank account to other party. system that powers
multiple bank accounts into single mobile application. regulated by RBI. Currently UPI is available only for
smartphones. Currently UPI is biggest among NPCI operated systems (NACH, IMPS, AEPS, BBPS, RuPay etc).
Top UPI apps: PhonePe, Paytm, Google Pay, Amazon Pay, BHIM (BHIM is Government offering).
• Charges on UPI:
 Zero charge framework: Most other modes of digital retail payments attract charge on transactions.
But government from 2020 has mandated zero-charge framework for UPI transactions, meaning
charges on UPI for users as well as merchants (on MDR) is nil.

Page 302 of 719

  Government’s view: Terming UPI services as one digital public good, Finance Ministry said that there is
no consideration to levy any charges for UPI.
 RBI’s view: It views that subsidy on digital payments may have to be withdrawn as digital payment
increases, thus increasing subsidy burden. RBI asked stakeholders if MDR, one fee paid by merchants
to acquiring banks, should be brought back for UPI transactions. MDR on UPI transactions, has been
one long-standing demand of payments industry. Recently, RBI allowed UPI on credit cards.
 Benefits of charges on UPI and MDR:
o It will boost payment system as more private investors will be pitching in.
o It will save government finances on subsidies - government allocated Rs 200 crore for
reimbursement of charges towards RuPay debit card, UPI transactions and in 2021-22, govt. had
budgeted Rs 1,500 crore towards this.
 Demerits of charges on UPI and MDR:
o It will discourage booming UPI transactions by citizens. It will hurt digital ecosystem based on UPI
/ MDR.
• Significance:
 UPI is single largest retail payments system in India in terms of volume of transactions for small-value
payments. With implementation of UPI, mobile wallets will not be necessary for online payments.
deepen digital payments. inclusive digital payments. ease of transactions for consumers. greater
participation of retail customers in various segments of financial markets. enhance capacity of service
providers.
 Bharat Interface for Money (BHIM) [2016]:
• named after B.R. Ambedkar. Digital payment application (app) of India that works through UPI. developed
by NPCI. allows real time fund transfer. BHIM app allows user to transfer money to anyone with UPI-enabled
bank account. 3 Levels of authentication of BHIM app: BHIM app binds with device’s ID and mobile number;
user needs to sync whichever bank account (UPI or non-UPI enabled); Creation of pin to log into BHIM app.
UPI pin created by user with his bank account is needed for transaction.
 Bharat Bill Payment System (BBPS) [2013]:
• What:
 BBPS is one integrated bill payment system in India offering interoperable and accessible bill payment
service to customers through network of agents of registered member as Agent Institutions, enabling
multiple payment modes, and providing instant confirmation of payment.
BBPS is interoperable platform for standardized bill payment system, conceptualised by RBI
and implemented by NPCI.
BBPS is payment platform for all bills, providing interoperable and accessible “Anytime
Anywhere” bill payment service.
• Feature:
 NPCI functions as authorised Bharat Bill Payment Central Unit (BBPCU), which will be responsible for
setting business standards, rules and procedures for technical and business requirements for all
participants.
 NPCI, as BBPCU, will also undertake clearing and settlement activities related to transactions routed
through BBPS.
 Existing bill aggregators and banks are envisaged to work as Operating Units to provide interoperable
bill payment system irrespective of which unit has on-boarded particular biller.
 Payments may be made through BBPS using cash, transfer cheques, and electronic modes.
 BBPS has also been integrated with UPI for Easy, Safe & Instant Payments through UPI enabled
Smartphones.
 Merchant Discount Rate (MDR):
→ rate / fee charged to merchants by their issuing bank for processing debit and credit card transactions of their
customers via credit, debit cards. rate that merchants pay to scheme providers (for RuPay, UPI, etc) to popularise
digital payments and thereby benefiting both customers and merchants. To accept debit and credit cards, merchants
must set up this service and agree to rate. typically between 1%-3% of card transactions.
 Regular card transaction:
→ Payment initiation -> merchants sends card details to acquiring bank -> Acquiring bank forwards transaction request
to issuing bank -> issuing bank accepts or rejects transaction request and responds -> Transaction is completed.
 Tokenised card transaction:
→ Payment initiation (using saved card information converted into token) -> merchants sends tokenised information
to acquiring bank -> Acquiring bank forwards tokenised request to issuing bank -> issuing bank accepts or rejects
tokenised request and responds -> Transaction is completed.
 UPI123Pay:
→ What:
 new UPI payments solution for feature phone users. launched by RBI in 2022.
→ Feature:
Page 303 of 719
  3-step method to initiate and execute services for users which will work on simple phones. It will allow customers
to use feature phones for almost all transactions except scan and pay. It doesn’t need internet connection for
transactions. Customers have to link their bank account with feature phones to use this facility.
 It offers users 4 options to make payments without internet connectivity:
• Interactive Voice Response (IVR): Users would be required to initiate secured call from their feature phones
to predetermined IVR number and complete UPI on-boarding formalities to be able to start making financial
transactions like money transfer, mobile recharge, EMI repayment, balance check, etc.
• App-based functionality: User can also install app on feature phone through which many UPI functions,
those available on smartphones, will be available on their feature phone, except scan and pay feature.
• Missed call facility: This facility allows users to access their bank account and perform routine transactions
such as receiving, transferring funds, regular purchases, bill payments, etc., by giving missed call on number
displayed at merchant outlet. Customer / user will receive incoming call to authenticate that transaction by
entering UPI PIN.
• Proximity sound-based payments: User can utilise proximity sound-based payments option, which uses
sound waves to enable contactless, offline, proximity data communication.
→ Significance:
 Users can make payments to their friends and family, pay their utility bills, recharge FASTags, pay mobile bills,
check their account balances, link bank accounts, set or change UPI PINs.
 ‘Payments Vision 2025’ [2022]:
→ One document released by RBI in 2022. As part of this vision 2025, RBI will attempt: regulation of big tech and
fintech in payments space; explore guidelines on payments that involve BNPL (buy now pay later) services; work
towards introduction of CBDC; seek inclusion of rupee in Continuous Linked Settlement (CLS) (CLS provides
protection for cross-currency settlement in 18 currencies).
 Card-On-File Transaction:
→ Card-on-file transaction is when cardholder authorizes merchant to store his payment information securely
and bill cardholder's stored account for future purchases. It is transaction where cardholder has authorised
merchant to store cardholder’s Mastercard or Visa payment details e.g., e -commerce companies, hotels
generally do it.
One common example is when person joins local gym. When filling out paperwork, he will likely be
asked to agree to provide his credit or debit card information for recurring monthly payments. Once
authorized, gym can automatically bill him / customer with his stored payment details on file. Indeed, this
is more efficient and less time-consuming than manually entering card details or requesting this
information for each billing cycle.
Of course, card-on-file payments can also be used for other transaction types, such as one-time
payments, top-ups, or upgrades in services or products.
 Reserve Bank of India – Digital Payments Index (RBI-DPI) [2021]:
→ It was launched in 2021. It captures extent of digitisation of payments across India (with 2 018 as base year
- score set as 100) and is published semi-annually.
→ Parameters: Payment enablers; Payment Infrastructure – Demand Side; Payment Infrastructure – Supply
Side; Payment Performance; Consumer Centricity.
 Aadhaar Enabled Payments System (AePS):
→ AePS (by NPCI) is one bank led model which allows online interoperable financial inclusion transaction at
PoS (MicroATM) through Business Correspondent of any bank using Aadhaar authentication. AePS allows
us to do 6 types of transactions: Cash Deposit, Cash Withdrawal, Balance Enquiry, Mini Statement, Aadhaar to
Aadhaar Fund Transfer, Authentication, BHIM Aadhaar Pay. Only inputs required for customer to do transaction
under this scenario are: Bank Name, Aadhaar Number, Fingerprint captured during enrollment.
 Liveness detection:
→ Liveness detection in biometrics is ability of system to detect if fingerprint or face (or other biometrics) is real (from
live person present at point of capture) or fake (from imitation artefact or lifeless body part).
In 2022, UIDAI of India introduced one new security layer in Aadhaar-enabled Payment System (AePS) called
“liveliness” of fingerprints, one feature intended to prevent use of fake fingerprints to fraudulently withdraw money
through AePS.
Value Addition:
 Bank wire:
→ Electronic message system that allows major banks to communicate information regarding client accounts.
represents secure computerized messaging system that sends account information, notifications,
transaction requests between banks.
 Wire transfer:
→ electronic transfer of funds across network, which is administered by group of banks. helps people in
different geographic locations to safely transfer money to one another. During wire transfer, no physical
money is exchanged between banks or financial institutions; instead, ba nks pass information among one
another regarding who recipient is, what his bank account number is, how much money he is receiving etc.
Page 304 of 719
Question:
 The most likely consequence of implementing Unified Payments Interface (UPI) is that Mobile wallets will not be
necessary for online payments.
 NPCI helps in promoting financial inclusion in India. NPCI has launched RuPay, one card payment scheme. NPCI is one
umbrella organisation for operating retail payments and settlement systems in India. It is one initiative of RBI and IBA
under Payment and Settlement Systems Act, 2007. RuPay and other card payment system comes under NPCI.
 Digital signature is one electronic method (not electronic record) of signing electronic document and ensuring that
original content is unchanged. Digital signature is electronic method of signing electronic document whereas Digital
Certificate is digital equivalent (that is electronic format) of physical or paper certificate. Few examples of physical
certificates are drivers’ licenses, passports or membership cards.
 Digital certificate is issued by trusted 3rd party to establish identity of certificate holder. It is used to serve as proof of
identity of individual to access information or server on Internet. Digital Certificates help prevent someone from using
phoney key to impersonate someone else.
 With respect to government expenditure in India, Transfer Payments are payments which are made as financial aid in
social welfare programme and also payments which are made to oil companies in lieu of subsidies, etc. Transfer payments
refer to payments which result in redistribution of income. These payments are considered to be exhaustive because
they do not directly absorb resources or create output. This implies that transfer is made without any exchange of goods
or services. Examples of certain transfer payments include welfare (financial aid), social security, government making
subsidies for certain businesses.
 UPI allows direct payment from bank account to merchant account. So need for wallet will no longer be required.
Mains Link:
 There is a growing support for either regulating big tech companies such as Facebook and Google. Discuss the reasons.
Should they be broken up? Comment. (15M)
 Explain the dominance of global technological giants and in what way it is a cause of concern for Indian tech companies
and start-ups? Also suggest way forward to address the situation. (15M)
 India’s progress in payment systems will provide a useful backbone to make a state-of-the art central bank digital currency
(CBDC), but challenges remain. Discuss. (250 Words)

SEPTEMBER, 2022
COMPETITION, PRICING STRATEGY / PRICING POLICY
News:
 2021:
→ Directorate General of Trade Remedies (DGTR), Commerce Ministry to review dumping in Steel products from China.
→ US may tax aluminium exports from countries - including India.
→ CCI orders investigation into controversial WhatsApp’s 2021 Privacy Policy.
→ CCI orders probe against Google for alleged anti-competitive practices in smart television operating systems market
in country.
→ In appeal hearing of Facebook and its firm WhatsApp against single-judge order of Delhi High Court refusing to stop
CCI‘s order directing probe into WhatsApp’s new privacy policy, WhatsApp has told Delhi High Court that it will not
compel users to opt for new privacy policy till data protection bill comes into force.
→ Anti-trust case filed against Apple Inc for allegedly abusing its market position in Indian economy.
→ CCI found that some beer companies had colluded to fix beer prices for full decade — between 2009 and 2018.As
result, CCI slapped penalty (crores) on companies for cartelisation in sale and supply of beer in some States, UTs.
→ CCI will identify measures to enhance competition in India’s pharmaceutical sector for ensuring affordability of drugs.
 2022:
→ CCI dismisses allegations of predatory pricing against e-commerce platform Shopee (Singapore based).
 Allegation: Shopee is alleged to sell many products at extremely low prices with intention to eliminate
competition from small retailers.
 CCI Ruling: CCI rules that Shopee does not hold significant market power because it is relatively new entrant in
Indian market with well established players.
→ Competition (Amendment) Bill, 2022 introduced with aim to improve regulatory set-up by increasing CCI’s
accountability, by giving it flexibility and enforcement efficiency.
→ India’s optical fibre industry has seen unfair competition from cheap imports from China, Indonesia, and South Korea.
These countries have been dumping their products in India at rates lower than market price.
→ If Competition (Amendment) Bill, 2022 is passed, businesses accused of anti-competitive practices, including abuse
of their dominant positions, will be able to settle cases by negotiating with CCI.
 At present, CCI is empowered to show tolerant and give full exemption from penalty to member of cartel who
makes vital disclosures about existence of cartel and cooperates with investigations, but negotiated settlements
are not part of rule book. Previously, SEBI and Income Tax Department offered settlements under different
schemes.
→ Economic Advisory Council to Prime Minister (EAC-PM) releases Competitiveness Roadmap for India@100, which is
part of India Competitiveness Initiative.
Page 305 of 719
 → CCI imposes a penalty of Rs. 1,337.76 crore on Google for abusing its dominant position in multiple markets in the
Android mobile device ecosystem. Besides, the fair trade regulator has directed the internet major to cease and
desist from unfair business practices.
 The allegations of unfair business practices pertained to 2 agreements — Mobile Application Distribution
Agreement and Anti Fragmentation Agreement — which were entered into by the OEMs of Android OS (like
Samsung, HTC, LG, etc.) with Google.
 Google has perpetuated its dominant position in the online search market resulting in the denial of market
access for competing search apps. Also, Google has leveraged its dominant position in the app store market for
Android OS to protect its position in online general search which violates the competition law (Competition Act,
2022). Section 4 Competition Act, 2022 pertains to the “Abuse of dominant position”.
About:
 Pricing strategy / Pricing Policy:
→ What:
 Pricing strategies determine price companies set for their products. Price can be set to maximize profitability for
each unit sold or from market overall. It can also be used to defend existing market from new entrants, to
increase market share within one market or to enter new market. Pricing strategies can bring both competitive
advantages and disadvantages to its firm and often dictate success or failure of business; thus, it is crucial to
choose right strategy.
→ Models of pricing:
 Predatory pricing, Dumping etc.
 Predatory pricing:
→ What:
 pricing strategy that uses method of undercutting on larger scale, where dominant firm in industry will
deliberately reduce prices of product or service to loss-making levels in short-term.
 illegal act of setting prices low to attempt to eliminate competition.
→ Aim:
 That existing or potential competitors within that industry will be forced to leave market, as they are unable to
effectively compete with dominant firm without making loss.
→ Feature:
 Once competition has been eliminated, dominant firm, now having majority share of market, can raise its prices
to monopoly levels in long-term to regain its losses.
 Difference between predatory pricing and competitive pricing is during recouping / regaining phase of lost
profits by dominant firm charging higher prices.
 Less firms in market.
 It is considered anti-competitive in many jurisdictions making it illegal under some competition laws.
 It violates antitrust laws, as it makes markets more vulnerable to monopoly.
→ Impact:
 With there being less firms in market causing consumers to have fewer choices between products or services,
these higher prices result in consumer harm.
 usually causes consumer harm
 makes markets more vulnerable to monopoly
→ To prove that firm is engaging in Predatory pricing, below 3 criteria should be met:
 Enterprise / firm must be dominant player in relevant market.
 Enterprise / firm’s goods or services are being marketed below cost.
 Enterprise / firm uses sub-tactics with intention to eliminate competition.
 Dumping:
→ What:
 Dumping, in economics, is one kind of injuring pricing, especially in context of international trade. It occurs when
manufacturers export product to another country at price below normal price with injuring effect. That is, in
international trade practices, dumping is act of selling goods by one country in market of another country, lower
than selling price of that goods in its own (exporting country) domestic market.
 When goods are exported by one country to foreign country at price lower than price it charges in its own home
market is called dumping. Dumping is one situation of international price discrimination and this unfair trade
practice has -ve impact on international trade.
 Dumping is process wherein company exports product at price that is significantly lower than price it normally
charges in its home (or its domestic) market.
→ Objective:
 To increase market share in foreign market by driving out competition and thereby create monopoly situation
where exporter will be able to unilaterally dictate price and quality of that product.
→ Effect:

Page 306 of 719

  Dumping impacts price of that product in importing country and thus hitting profits of importing country’s local
manufacturing firms.
→ Remedy:
 Under WTO rules, dumping is illegal only if foreign country can reliably show -ve effects exporting firm has
caused its domestic producers. In order to protect domestic producers from dumping, countries use tariffs and
quotas. Trade treaties might include mechanisms to alleviate problems related to dumping, such as
countervailing duty penalties and anti-dumping statutes.
→ Anti-dumping duty (ADD):
 What:
• ADD is one protectionist tariff that domestic government imposes on foreign imports that it believes are
priced below fair market value. ADD is imposed as remedy to distortive trade which arises due to dumping
of goods. This tool of fair competition is permitted by WTO. From long-term perspective, ADD can reduce
international competition of domestic companies producing similar goods. ADD is imposed to rectify
dumping of goods and its trade-distortive effect. According to global trade norms (WTO etc), countries are
allowed to impose tariffs on dumped products to provide level-playing field to importing country’s domestic
manufacturers.
 Sunset clause for Anti-Dumping Duty:
• ADD is valid for period of 5 years from date of imposition, unless revoked earlier. It can be extended for
further period of 5 years through one sunset or expiry review investigation conducted in accordance with
WTO Anti-dumping Agreement.
→ India:
 ADD is imposed after investigation by Directorate General of Trade Remedies (DGTR), Commerce
Ministry - quasi-judicial body. DGTR administers all trade remedial measures. Trade remedial measures
include anti-dumping, countervailing duties and safeguard measures. DGTD’s job is to provide trade
defence support to domestic industry. DGTR provides safeguards to India’s exporters in dea ling with
increasing instances of trade remedy investigations instituted against them by other countries.
→ ADD vs CVD:

{ADD} {CVD (Countervailing Duty)}
customs duty on imports providing protection against customs duty on imports that have received
dumping of goods government subsidies in exporting country
counter negative impact of import subsidies so as to
protect domestic producers.
tariffs levied on imported goods to offset subsidies
given to producers of exporting country.
Achieve level playing field between domestic
producers and foreign producers who can afford to sell
at lower price because of exporting country’s govt.
subsidy given to them.
 Settlement (litigation):
→ What:
 In law, settlement is resolution between disputing parties about legal case, reached either before or after court
action begins.
→ Type:
 Collective settlement: It is one settlement of multiple similar legal cases.
 Structured settlements: It provides for future periodic payments, instead of one-time cash payment.
 Negotiated settlement: Form of regulation of public utilities that is alternative or complementary to
conventional process of litigation. Since early 1960s, these settlements have been seen primarily as means of
coping with regulatory backlog and as saving regulatory processing time.
→ Benefits:
 Settlements and commitments will help to avoid extensive procedures, cut down litigation, and make
enforcement more effective while improving investment climate for businesses by reducing uncertainty.
→ Global:
 International practices: Negotiated settlements and commitments, are allowed in EU, Japan, US, to quickly
resolve cases through financial or non-monetary provisions to reduce litigation.
→ India:
 In context of competition, at present, CCI is empowered to show tolerant and give full exemption from penalty
to member of cartel who makes vital disclosures about existence of cartel and cooperates with investigations,
but negotiated settlements are not part of rule book. Previously, SEBI and Income Tax Department offered
settlements under different schemes.

Page 307 of 719

 If Competition (Amendment) Bill, 2022 is passed, businesses accused of anti-competitive practices,
including abuse of their dominant positions, will be able to settle cases by negotiating with CCI.
 Cartelisation:
→ Cartel:
 association of manufacturers or suppliers with purpose of maintaining prices at high level and restricting
competition.
 According to CCI, cartel includes association of producers, sellers, distributors, traders or service providers who,
by agreement amongst themselves, limit, control or attempt to control production, distribution, sale or price of,
or, trade in goods or provision of services.
→ Why:
 Companies blame government rules, which require them to seek approvals from State authorities for any price
revisions.
→ Component:
 Agreement. Competitors. To restrict competition.
→ Features:
 Agreement - that forms cartel - need not be formal or written.
 Usually cartels involve secret conspiracies.
 participants in cartels agree to insulate themselves from competitive marketplace, substituting cooperation
instead of competition.
→ Function:
 Price-fixing. Output restrictions. Market allocation. Bid-control.
→ Impacts:
 Hurt consumers
 undermine overall economic efficiency and innovations.
 companies either force some consumers out of market by making commodity (say, beer) more scarce or by
earning profits that free competition would not have allowed (high price).
 Cartels neither have any incentive to invest in research aimed at improving their product nor do they see any
reason to boost investments towards making methods of production more efficient. Thus, cartels can be even
worse than monopolies.
Note:
 Competition Act, 2002:
→ What:
 Act to provide for establishment of Commission to prevent practices having adverse effect on competition, to
promote and sustain competition in markets, to protect interests of consumers and to ensure freedom of trade
carried on by other participants in markets, in India.
 on recommendations of Raghavan committee, 2000.
→ Provision:
 Prohibition of anti-competitive agreements
 Prohibition of abuse of dominant position by enterprises.
 Regulation of acquisition, acquiring of control etc., which causes or likely to cause adverse effect on competition
within India.
 Establishment of CCI [2003].
 Competition Commission of India (CCI) [2003]:
→ What:
 CCI is chief national competition regulator in India. It is one statutory body within Ministry of Corporate Affairs
and is responsible for enforcing Competition Act, 2002 to promote competition and prevent activities that have
appreciable adverse effect on competition in India. It is fair trade regulator. It is also quasi-judicial body. It was
established under Competition Act, 2002 for administration, implementation and enforcement of this Act, and
was duly constituted in 2009.
→ Objective:
 Eliminate practices that have adverse effect on competition; promote and sustain competition; protect
consumers’ interests; ensure freedom of trade in Indian markets.
→ Appointment:
 Chairman and members are appointed by central government.
→ Focus:
 CCI primarily pursues 3 issues of anti-competitive practices in market:
• Anti-competitive agreements;
• Abuse of dominance;
• Combinations (any acquisition, merger or amalgamation may constitute combination).
→ Functions:

Page 308 of 719

  free and fair competition; eliminate practices having adverse effects on competition; promote and sustain
competition; protect interests of consumers; ensure freedom of trade in markets of India; to give opinion on
competition issues on reference being made by other statutory authorities; create public awareness; Undertake
capacity building & competition advocacy; impart training on competition issues.
 CCI looks into cases and investigates them if same has -ve impact on competition.
 CCI also approves combination under Competition Act, 2022 so that two merging entities do not overtake
market.
 Eliminate practices adverse to competition; Ensure freedom of trade in markets; Promote and sustain
competition; Protect interests of consumers; Give opinion on competition issues; Undertake capacity building &
competition advocacy.
 Competition (Amendment) Bill, 2022:
→ What:
 Bill further to amend Competition Act, 2002.
→ Need:
 As dynamics of market changes rapidly due to technological advancements, AI, and increasing importance of
factors other than price, amendments became necessary to sustain and promote market competition.
→ Feature:
 Increasing transparency and strengthening accountability:
• One board with part-time members to supervise CCI activities.This would bring its regulatory architecture
at par with that of financial regulators.
• CCI to mandatorily issue penalty guidelines and give reasons in case of any divergence.It will give much-
needed certainty in regulatory environment.
 Enforcement efficiency:
• CCI could engage in structured negotiations with parties and arrive at mutually-workable solutions without
having to go through lengthy formal proceedings.This will bring powers of CCI on par with SEBI, which has
been passing settlement orders for over decade.Previously, CCI was only empowered to take action for
abuse of dominance or anti-competitive agreements in form of final orders in proceedings before it.
• CCI can make appeals to National Company Law Appellate Tribunal (NCLAT) conditional on pre-deposit of
up to 25% of penalty imposed by CCI.This change is likely to deter non-serious appeals.
• Shortening of merger review period from 210 to 150 days.
• Introduction of one green channel for merger applications: Certain categories of mergers that had to wait
for CCI approval would be allowed to attain full consummation without any standstill obligation under this
new green-channel process.
 Flexibility:
• Previously, only those agreements are allowed which were made between businesses at same level of
production (such as competitors that form cartel) or businesses that are in directly upstream or downstream
market (such as agreements between manufacturer and distributor). If parties do not fall in either of these
brackets, anti-competitive agreements between them can go unchecked.
• Now, this 2022 bill also recognizes other forms of cartels such as hub-and-spoke cartels. This 2022 bill also
has catch-all provision to enable CCI to deal with anti-competitive pacts irrespective of structural
relationships between parties.
 Limitations:
• This 2022 bill does little to address competition concerns in digital markets. e.g., mergers concern in digital
markets between entities that do not have significant assets or turnover, but are still very significant (such
as Facebook-WhatsApp).
• No effective clause for regulating anti-competitive conduct by digital platforms.
→ Impact:
 By implementing these amendments, CCI should be better equipped to handle certain aspects of new-age
market and transform its functioning to be more robust.
 Countervailing duty (CVD) / Anti-Subsidy Duty:
→ What:
 CVDs are tariffs levied on imported goods to offset subsidies made to producers of these goods in exporting
country. CVDs are meant to level playing field between domestic producers of product and foreign producers of
same product who can afford to sell it at lower price because of subsidy they receive from their government.
 CVDs are trade import duties imposed under WTO rules to neutralize -ve effects of subsidies. They are imposed
after investigation finds that foreign country subsidizes its exports, injuring domestic producers in importing
country. According to WTO rules, country can launch its own investigation and decide to charge extra duties,
provided such additional duties are in accordance with GATT Agreement on Subsidies and Countervailing
Measures.
 It is one customs duty on those goods that have received some kind of government subsidies whether in
originating or exporting country.

Page 309 of 719

  ADD vs Normal Customs Duty:
→
{ADD} {Normal Customs Duty}
To guard against unfair trade practices. It is means of raising revenue for overall development
of economy.
Trade remedial measures. Trade and fiscal policies of government.
Not necessary in nature. Necessary in nature.
It is levied against exporting country i.e.; it is countryUniversally applicable to all imports as per country of
specific and exporter specific. origin and exporter.
 Shopee Ltd. [2015]:
→ Singaporean multinational technology company
→ It focuses mainly on e-commerce.
→ As of 2021, it is widely considered as largest e-commerce platform in SE Asia.
→ It also serves consumers and sellers throughout in many countries across Americas and Europe.
 Hub-and-spoke arrangements in competition:
→ Hub-and-spoke arrangements are horizontal restrictions on supplier or retailer level (“spokes”), which are
implemented through vertically related players that serve as common “hub” (e.g., common manufacturer, retailer
or service provider). “Hub” facilitates co-ordination of competition between “spokes” without direct contacts
between spokes. In extreme, effects of horizontal hard-core cartel can be achieved purely based on indirect
communication between horizontally aligned members of one hub and spoke arrangement.
Hub-and-Spoke arrangement is one kind of cartelisation in which vertically related players act as hub and place
horizontal restrictions on suppliers or retailers (spokes).
 Gun jumping / Jumping the gun:
→ It refers to selectively using financial information that has not been publicly announced. At least 2 illegal methods of
jumping the gun can be identified as:
 Soliciting orders to buy new issue before registration of IPO.
 Buying or selling stock based on information that has not yet been disclosed to public.
→ If combining parties close notified transaction before approval, or have consummated reportable transaction
without bringing it to CCI’s knowledge, it is seen as gun-jumping. Penalty for gun-jumping is about 1% of asset or
turnover.
 Competitiveness Roadmap for India@100:
→ What: This roadmap was released by Economic Advisory Council to Prime Minister (EAC-PM) in 2022. It is also called
Roadmap for Better Growth - India @100. It is part of India Competitiveness Initiative. It aims to enable India to
become high-income country by 2047 using sector and region-specific policies based on 4S principle:
 Shared Prosperity: Opportunities should be shared across every section of society;
 Social Prosperity: Economic Growth should match social development;
 Sustainable Prosperity: Eeconomic progress should be environmentally sustainable;
 Solid Prosperity: Economic system should be resilient to shocks.
→ Recommendations to achieve these 4S principle:
 Structural Transformation 2.0: Creating new jobs using sector-specific and region-specific initiatives (e.g. PLI for
different sectors, Mega food parks for different regions).
 Convergence of programs and initiatives (including public-private participation).
 Reduce social and institutional barriers for citizens (Eg. reducing discrimination in jobs, increasing safety for
women, ease travelling experiences such as women given free transport in Delhi DTC buses).
 Enable competition in market (e.g. greater competition in e-commerce is profitable for citizens).
Value Addition:
 International Competition Network [2001]:
→ informal, virtual network
→ to facilitate cooperation between competition law authorities globally.
 Cartels vs monopolies:
→ Cartels can be even worse than monopolies. Cartels neither have any incentive to invest in research aimed at
improving their product nor do they see any reason to boost investments towards making methods of production
more efficient.
 Tied Selling:
→ sometimes referred to as coercive tied selling. illegal practice of company providing product or service on condition
that customer purchases some other product or service. frequently used in reference to banks. against law. occurs
when company conditions sale of product or service only if that customer purchases some other product or service.
Tied selling may be used as means of price discrimination.
Question:
 India ratified Trade Facilitation Agreement (TFA) of WTO. TFA is part of WTO’s Bali Ministerial Package of 2013.
TFA entered into force in 2017.

Page 310 of 719

  CCI is statutory body responsible for enforcing Competition Act, 2002. CCI ensures freedom of trade in market.
CCI protects interests of consumers.
Mains Link:
 The role of the Competition Commission of India has been very important to regulate the process and achieve
the public policy goal of competition in India. Comment (10M)

CYBER
News:
 2010:
→ Cabinet Committee on Security (CCS) approves NATGRID project.
→ Computer Emergency Response of Team (CERT) of India issued warning against new malware – EventBot (Trojan).
 2021:
→ State-sponsored Chinese hackers targeted Indian power grids.
→ Pegasus is being used by governments worldwide.
→ West Bengal set up Commission of Inquiry (Lokur Commission), under Commissions of Inquiry Act, 1952, to look into
alleged surveillance of phones using Pegasus spyware and into alleged breach of privacy of several individuals.
→ Complaints in Supreme Court about misuse or likely misuse of Pegasus spyware in violation of right to privacy of
citizens.
→ Supreme Court says power of state to snoop in name of national security into “sacred private space” of individuals
is not absolute.
→ Supreme Court appoints expert technical committee (R.V. Raveendran committee) to examine allegations that
Centre used Israeli software Pegasus to spy on citizens.
→ New vulnerability named Log4Shell discovered.
→ Supreme Court stays proceedings of one Commission of Inquiry appointed by West Bengal Government to look into
allegations of snooping using Pegasus software.
→ Information about critical security vulnerability in Log4j library is publicly disclosed.
→ In response to RTI filed, Union Home Ministry says it does not maintain centralised list of Cyber volunteers enrolled
under Cyber crime volunteer programme because police is “State subject” under 7th Schedule of Constitution.
→ Report about cyber ecosystem of countries is released by International Institute for Strategic Studies (IISS), UK think
thank.
→ International Telecommunication Union (ITU) releases Global Cyber Security Index (GCI), 2020.
→ Centre may soon launch National Intelligence Grid (NATGRID) to provide cutting-edge technology to
enhance India’s counter-terror capabilities.
→ NATGRID is in news now because it is expected to be launched by PM Modi soon.
 2022:
→ GitHub platform was used to create and share app Bulli Bai that sexually harassed Muslim women in India. [app used
pictures of women stolen from their social media and invited users to bid for them].
 Action:
• GitHub has blocked user.
• Indian Computer Emergency Response System (Cert-In) has been asked to investigate.
• Delhi Police, Mumbai Police have registered FIRs.
→ One American Agency finds that ModifiedElephant (one hacking group) had allegedly planted incriminating evidence
on personal devices of Indian journalists, human rights activists, human rights defenders, academics, lawyers.
 Issue:
• ModifiedElephant have been infecting their targets using spearphishing emails with malicious file
attachments.
• Through mail, ModifiedElephant group delivers malware to their targets. NetWire and DarkComet, two
publicly-available remote access trojans (RATs), were primary malware families deployed by
ModifiedElephant. ModifiedElephant also sent android malware to its victims.
→ Microsoft introduces cybersecurity skills development campaign in 23 geographies, including India, to address
alarming shortage of internet security professionals.
→ Under Information Technology Act, 2000, CERT-In takes following steps to prevent Cyber breaches:
 Steps are:
• All service providers, intermediaries, data center providers, corporates, government organizations must
report cyber incidents within 6 hours of their detection.
• Virtual asset, exchange, and custodian wallet providers must maintain records on KYC and financial
transactions for period of 5 years.
• Companies providing cloud, virtual private network (VPN) must register validated names, emails, IP
addresses of subscribers.
• Service providers must provide information and assistance to CERT-In for any action taken to mitigate
impact of cyber incident.

Page 311 of 719

 • To ensure chain of events is accurately reflected in time frame, service providers must connect and
synchronize all their ICT systems clocks to Network Time Protocol (NTP) Server of National Informatics
Centre (NIC) or National Physical Laboratory (NPL) of India.
 Need:
• CERT-In found certain gaps that were “causing hindrance to incident analysis”.
 Significance:
• CERT-In says these directions will enhance “overall cybersecurity posture” and guarantee “safe and trusted
Internet” in India.
→ Minister for Home and also for Cooperation Amit Shah inaugurates NATGRID campus in Bengaluru.
→ National Cyber Forensic Laboratory (NCFL) inaugurated on premises of Central Forensic Science Laboratory (CFSL) in
Hyderabad.
→ CERT-In’s directive to Virtual Private Network (VPN) providers to store user data on Indian servers has prompted
many of them to shut their local servers.
 CERT-In directives:
• VPN providers must store validated customer names, their physical addresses, email IDs, phone numbers,
and reason why customer is using VPN.
• VPN providers must log user’s “ownership pattern” and dates when they use VPN, along with record of
time-stamp for when user registered, and every IP address that VPN assigns to that user.
 Why VPN companies are leaving India?
• VPN providers who provide “no-logging” services cannot do so if they comply with such CERT-In rules, which
is why they are withdrawing servers to leave Indian government’s jurisdiction. E.g., NordVPN, Surfshark,
ExpressVPN.
 Impact:
• VPN providers install their servers in country to achieve 2 purposes — to be close to their users; and to
increase number of locations they can provide. Removing servers from India, in theory, affects overall speed
that VPN can provide, though this will hardly make difference for those using VPNs simply to browse web
by spoofing their location.
 Government Intention:
• Union government wants to access VPN data for domestic regions as well as may ask companies to comply
even if they have no physical presence in India, as their “computer systems” are operating within Indian
cyberspace.
→ Global cybersecurity firm Kaspersky warns of increase in cyberattacks on Android and iOS devices in Asia
Pacific (APAC) region.
→ Indian CERT-In under Ministry of Electronics & IT, in collaboration with Cyber Security Agency of Singapore,
successfully designed & conducted Cyber Security Exercise “Synergy” for 13 Countries as part of
International Counter Ransomware Initiative - Resilience Working Group which is being led by India under
leadership of National Security Council Secretariat (NSCS). [This exercise Synergy aims to exchange best
practices among Member-States to build network resiliency against ransomware & cyber extortion
attacks].
→ Cyber-security researchers unearths, recently in Kazakhstan, one new enterprise-grade spyware called 'Hermit' that
is being used by governments via SMS messages to target high-profile people.
→ NCRB releases “Crime in India” report 2021.
→ India (National Security Council Secretariat) and UK Government in collaboration with BAE Systems (UK) successfully
designed & conducted Cyber Security Exercise for 26 Countries as part of International Counter Ransomware
Initiative - Resilience Working Group which is being led by India under leadership of National Cyber Security
Coordinator.
→ Operation Megh Chakra: CBI conducts pan-India searches after receiving inputs from Interpol’s Singapore unit,
which, in turn, got information from New Zealand authorities about sale and circulation of child sexual abuse material
(CSAM) online. Under this operation, CBI conducted searches at 59 locations across 20 States and one Union
Territory, as part of one pan-India drive against circulation and sharing of Child Sexual Abuse Material (CSAM). [Earlier
in2021 CBI, under Operation Carbon exercise, CBI raided suspects in 13 States and one Union Territory].
→ There are reports that the Indian Army is developing cryptographic techniques to make its networks resistant to
attacks by systems with quantum capabilities.
→ One new mobile banking 'Trojan' virus - SOVA - which can stealthily encrypt Android phone for ransom and is hard
to uninstall is targeting Indian customers. So, CERT-In issues detailed safety advisory against this new mobile banking
‘Trojan’ virus, SOVA, prowling in Indian cyberspace, which stealthily encrypts android phone for ransom.
About:
 Malicious Software (Malware):
→ What:
 software designed to perform unwanted illegal act via computer network i.e. software with malicious intent.
→ Types:

Page 312 of 719

  Virus:
• Malicious program that infects other programs by modifying them to include possible evolved copy of itself.
infiltrating files. normally attached to email.
 Worm:
• Disseminated (spread) through computer networks. Malicious program that copy itself from system to
system, rather than infiltrating legitimate files like virus.
 Trojan (Trojan Horse):
• Malicious program that generally damages security of system. It creates back-doors (allows outsider to
access into secure network) on computers belonging to secure network so that hacker can access secure
network. Steals personal data, spy or crashing user computer.
 Hoax:
• E-mail warning user that certain system is harming computer. Thereafter, instructs user to run procedure
(usaully download) to fix system. When this downloaded program is run, it invades user computer and
deletes files.
 Ransomware:
• One type of malware that threatens to publish victim’s personal data or permanently block access to it
unless ransom is paid. (e.g. WannaCry, Petya, Locky). Encrypts user file. Then, demands ransom to return
data to user.
 Scareware:
• User is taken to page to purchase fake program.
 Adware:
• Annoys user with unwanted ads in attempt to get rid of ads by paying money.
 Spyware:
• Spying software is software with malicious behavior that aims to gather information about person or
organization and send it to another entity in way that harms user — for example, by violating their privacy
or endangering their device's security. This behavior may be present in malware as well as in legitimate
software. Websites may engage in spyware behaviors like web tracking. Hardware devices may also be
affected. Spyware is frequently associated with advertising. Because these behaviors are so common, and
can have non-harmful uses, providing precise definition of spyware is difficult task.
• Invades user computer, monitors user’s activities, without consent.
• usually spread via e-mails.
 Why cybersecurity skills should be developed?
→ As per Cybersecurity Ventures, by 2025, there will be 3.5 million cybersecurity jobs available globally, representing
350% increase over 8-year period. By that time, India alone is estimated to have almost 3.5 lakh cybersecurity jobs
positions waiting to be filled, both in private and public sectors.
 Cyber crime / Cyber security [India]:
→ “Cyber Laws” are under residuary powers of Parliament under Article 246 / 7th schedule.
→ Government Initiatives:
 India is working on its 1st Cyber Security Strategy.
 Indian Computer Emergency Response Team (CERT-In) [2004].
 National Intelligence Grid (NATGRID) [2009].
 National Cyber Security Coordinator (NCSC) [2014]:
• NCSC office coordinates with different agencies at national level of India for cyber security matters.
 Online cyber crime reporting portal [2018]:
• National cyber crime reporting portal
• to enable citizens to report obscene contents
• Child Pornography / Child Sexual Abuse Material
• Rape / gang rape imageries
• sexually explicit content etc.
 Cyber Volunteer Scheme / Indian Cyber Crime Coordination Centre (I4C):
• To combat cybercrime in India. It is under MHA.
• to handle issues related to cybercrime in India in comprehensive and coordinated manner.
• nodal point at National level in fight against cybercrime.
• platform to deal with cybercrimes in coordinated and comprehensive manner.
• to bring together citizens with passion to serve nation on single platform by contributing in fight against
cybercrime in country.
• to flag unlawful content on Internet
• volunteers are registered with respective State / UT
• Services of volunteers are utilised by respective State / UT.
• Concerns:

Page 313 of 719

  Union Ministry of Home Affairs has not provided information on how Cyber Volunteer Scheme program
will be controlled so that it is not misused for personal or political gain or survellaince on citizens.
 No clear definition of “unlawful content”.
 Cyber Volunteer Scheme may violate 2013 Shreya Singhal Judgment of Supreme Court which says wide
restrictions on online speech should not be used by state as tool to criminalise free speech on internet.
 National Critical Information Infrastructure Protection Centre (NCIIPC) [2014]:
• for protection of critical information infrastructure in India.
 Cyber Surakshit Bharat Yojana (2018): It also does awareness programs on cyber security.
 Crisis Management Plan:
• to counter cyber-attacks, cyber terrorism.
 Cyber Swachhta Kendra / Botnet Cleaning and Malware Analysis Centre:
• for providing detection of malicious programmes and free tools to remove such programmes.
 In 2022, CERT-In took following steps to prevent Cyber breaches:
• All service providers, intermediaries, data center providers, corporates, government organizations must
report cyber incidents within 6 hours of their detection.
• Virtual asset, exchange, and custodian wallet providers must maintain records on KYC and financial
transactions for period of 5 years.
• Companies providing cloud, virtual private network (VPN) must register validated names, emails, IP
addresses of subscribers.
• Service providers must provide information and assistance to CERT-In for any action taken to mitigate
impact of cyber incident.
• To ensure chain of events is accurately reflected in time frame, service providers must connect and
synchronize all their ICT systems clocks to Network Time Protocol (NTP) Server of National Informatics
Centre (NIC) or National Physical Laboratory (NPL) of India.
 Challenges / concern:
→ The world is moving towards an era in which the applications of quantum physics in strategic domains will soon
become a reality, increasing cybersecurity risks. [India needs a holistic approach with a focus on post-quantum
cybersecurity to tackle these challenges].
→ Cyberattacks on Indian organizations have more than doubled in recent years. For instance, ransomware attacks on
Indian organizations in 2021 increased 218% year-on-year, reported security firm Palo Alto Networks.
→ Digital gaps amongst nations create unsustainable environment in cyber domain.
→ Growing digital reliance has exposed digital disparities which must be bridged through capacity building.
→ Terrorists are using sophisticated cyberspace to broaden their propaganda and incite hatred.
→ In 2019, cyber crimes in India caused Rs. 1.25 trillion loss.
→ Cyber threats will continue to increase as India starts developing smart cities, rolling out 5G network.
→ There are only few Indian companies who are making some of cyber security products and there is big vacuum in
cyber sector.
→ Current protocols like the RSA Algorithm will quickly become outdated. This means that quantum cyberattacks can
potentially breach any hardened target.
→ China’s quantum advances expand the spectre of quantum cyberattacks against India’s digital infrastructure, which
already faces a barrage of attacks from Chinese state-sponsored hackers.
→ Particularly worrying for India is the fact that China now hosts 2 of the world’s fastest quantum computers.
→ India’s dependence on foreign, particularly Chinese hardware, is an additional vulnerability.
 Initiatives for Cybersecurity:
→ International Counter Ransomware Initiative - Resilience Working Group and its cyber security exercise
“Synergy”.
→ Budapest Convention on Cybercrime.
→ In 2019, GOI declared quantum technology a “mission of national importance”.
→ In 2022, a joint team of the DRDO and IIT-Delhi successfully demonstrated a QKD link between 2 cities in UP
— Prayagraj and Vindhyachal.
→ GOI Union Budget 2020-21 proposed to spend Rs. 8,000 crore on National Mission on Quantum Technologies
& Applications (NM-QTA).
→ The Indian Army collaborated with industry and academia to build secure communications and cryptography
applications.
 Way Forward:
→ On quantum related cyber-attack:
 India must consider procuring the US National Security Agency’s NSA Suite B Cryptography Quantum-Resistant
Suite as its official encryption mechanism.
 Indian defence establishment can consider imitate the cryptographic standards set by the US’s National Institute
of Standards and Technology (NIST) which has developed a series of encryption tools to handle quantum
computer attacks.
Page 314 of 719
  India should start implementing and developing capabilities in quantum-resistant communications, specifically
for critical strategic sectors.
 GOI can fund and encourage existing open-source projects related to post-quantum cryptography.
 India can participate in the Open Quantum Safe (OQS) project — a global initiative started in 2016 for
prototyping and integrating quantum-resistant cryptographic algorithms.
 Prioritising QKDs over long distances, especially connecting military outposts for sensitive communications to
ensure secure communications whilst protecting key intelligence from potential quantum cyberattacks.
 Diplomatic partnerships with other “techno-democracies” — countries with top technology sectors, advanced
economies, and a commitment to liberal democracy — can help India pool resources and mitigate emerging
quantum cyber threats.
→ Development of cybersecurity skills.
→ Union Government should be empowered through its designated authority to block and / or prohibit all websites /
intermediaries that carry child sexual abuse material.
→ Law enforcement agencies should be permitted to break end to end encryption to trace distributors of child
pornography.
→ Tools should be developed which can analyse behaviour of every internet user so as to prevent user from falling into
cyber bullying.
→ Alerts / advisories.
→ Capacity building / training of law enforcement agencies.
→ cyber forensics facilities.
→ Harnessing India’s great digital-industrial potential.
→ data localisation
→ encryption
 Conclusion:
→ Police and Public Order are State subjects. Thus, States / UTs are primarily responsible for handling cyber crimes.
→ India needs a holistic approach to tackle cyber challenges. At the heart of this approach should be the focus on post-
quantum cybersecurity.
Note:
 Virtual Private Network (VPN):
→ What:
 VPN extends private network across public network and enables users to send and receive data across shared
or public networks as if their computing devices were directly connected to private network.
 VPN is computer network in which users can access shared pool of computing resources through service
provider.
→ Feature:
 VPN establishes protected network connection when using public networks.
 VPN encrypts our internet traffic and disguise our online identity. This makes it more difficult for 3rd parties to
track our activities online and steal data.
→ How:
 VPN is created by establishing virtual point-to-point connection through use of dedicated circuits or with
tunneling protocols over existing networks.
→ Benefits:
 Increase in functionality, security, and management of private network.
 It provides access to resources that are inaccessible on public network
 It is typically used for remote workers.
 Encryption is common, although not inherent part of VPN connection.
 VPN available from public Internet can provide some of benefits of Wide Area Network (WAN).
 From user perspective, resources available within private network can be accessed remotely.
 Indian Computer Emergency Response Team (CERT-In) [2004]:
→ What:
 India’s nodal cybersecurity agency.
 nodal agency for monitoring cyber security incidents.
 nodal agency which deals with cybersecurity threats – hacking, phishing.
 organisation of Ministry of Electronics and Information Technology, Government of India
→ Objective:
 securing Indian cyberspace.
→ Function:
 Information Technology (Amendment) Act, 2008 designated CERT-In to serve as national agency to perform
certain functions.
 responding to computer security events or incidents on national or government level.
 All organizations providing digital services are mandated to report cyber security incidents to CERT-In.
Page 315 of 719
  Collection, analysis and dissemination of information on cyber incidents.
 Forecast and alerts of cyber security incidents.
 Emergency measures for handling cyber security incidents.
 Coordination of cyber incident response activities.
 Issue guidelines, advisories, vulnerability notes and whitepapers relating to cyber information.
 Security practices, procedures, prevention, response and reporting of cyber incidents.
 Such other functions relating to cyber security as may be prescribed.
 National Intelligence Grid (NATGRID) [2009]:
→ What:
 Integrated intelligence master database structure for counter-terrorism purpose connecting databases of
various core security agencies under Government of India collecting comprehensive patterns procured from 21
different organizations that can be readily accessed by security agencies round clock.
 It is an intelligence-sharing network that collates data from various agencies and ministries of GOI.
 digital database
 mechanism to track suspects
 pattern search and recognition system
 developed by C-DAC Pune and IIT, Bhilai, Chhattisgarh.
→ Objective:
 NATGRID seeks to become one-stop destination for security and intelligence agencies to access database related
to immigration entry and exit, banking, telephone details of suspect on “secured platform”.
→ Background:
 It was 1st proposed in the aftermath of 2008 Mumbai terrorist attacks.
→ Feature:
 Agencies that will have access to NATGRID include CBI, DRI, ED, CBIC, CBDT, Cabinet Secretariat, IB, Directorate
General of GST Intelligence, NCB, Financial Intelligence Unit - India, NIA.
 It will be connected to 10 user agencies and 21 server providers in the 1 st phase, with an additional 950 entities
joining in later phases.
→ NATGRID data:
 NATGRID will procure data from many organisations:
• telecom
• tax records
• bank
• immigration
• ….
 NATGRID data will be stored on secured platform.
 NATGRID data can be accessed by central agencies only:
• Intelligence Bureau (IB)
• Research and Analysis Wing (R&AW)
• …..
→ Need:
 3rd degree interrogation:
• police rely on harsh and coercive means to extract information in crude and degrading fashion.
 Human rights violation:
• After every terrorist incident, suspects are round up, including many who are innocent.
→ Function:
 It would assist IB in keeping track of people with suspicious backgrounds.
→ Criticism:
 Possible violations of privacy, leakage of confidential personal information.
 Possible lack of efficacy in preventing terror because no State agency, State police has access to it.
 Possible misuse [Example: digital tools that terrorists use have also become weapons of ideologies].
 Intelligence agencies themselves fear that NATGRID would impinge on their territory. Possibly, may leak
information to other agencies.
→ Significance:
 Tracking suspects and help in preventing terrorist attacks [using real-time data, access to classified information
like immigration, banking, individual taxpayers, air and train travels etc].
 Help IB identify persons with suspicious backgrounds.
 Network Time Protocol (NTP):
→ networking protocol for clock synchronization between computer systems over packet-switched, variable-latency
data networks.

Page 316 of 719

 → NTP is protocol used for reliably transmitting and receiving accurate time sources over TCP/IP-based networks. It is
used for synchronizing internal clock of computers to one common time source.
→ In operation since before 1985, NTP is one of oldest Internet protocols in current use.
→ NTP was designed by David L. Mills of University of Delaware, USA.
→ In India, NTP is maintained by National Informatics Centre (NIC) and National Physical Laboratory (NPL) of India.
 Global Cyber Security Index (GCI):
→ trusted reference that measures commitment of countries to cybersecurity at global level – to raise awareness of
importance and different dimensions of cyber issue.
→ As cybersecurity has broad field of application, cutting across many industries and various sectors, each country’s
level of development or engagement is assessed along 5 pillars – Legal Measures, Technical Measures, Organizational
Measures, Capacity Development, and Cooperation – and then aggregated into overall score.
→ released by International Telecommunication Union (ITU)
→ 2020 Global Cyber Security Index (GCI):
 Finding:
• US - top
• India - 10th spot
• In Asia-Pacific region, India - 4th spot.
• China, Pakistan – ranked lower than India.
 National Cyber Forensic Laboratory (NCFL) [2022]:
→ NCFL plans to expedite resolution of cybercrime cases in India.
 2021 Report about cyber ecosystem of countries [International Institute for Strategic Studies (IISS), UK]
→ India:
 India has made only limited progress in developing its policy and doctrine for cyberspace security.
 Indian concerns about cyber security has increased due to:
• 2020 Ladakh confrontation with China
• increase in Chinese activity against Indian networks
• cyber threats in systems supplied by China.
 Currently, India is aiming to build new capability with help of international partners –US, UK, France etc.
 India’s institutional reform of cyber governance is slow though increaseing.
 India’s key coordinating authorities for cyber security in civil and military domains were established in 2018,
2019.
 Convention on Cybercrime / Budapest Convention on Cybercrime / Budapest Convention [2001]:
→ What:
 1st international treaty seeking to address Internet and computer crime (cybercrime) by harmonizing national
laws, improving investigative techniques, and increasing cooperation among nations. It addresses Internet and
cybercrime by harmonizing national laws. It was drawn up by Council of Europe, with active participation of
many Council of Europe's observer states.
→ India:
 Not party.
 Spearphishing:
→ practice of sending emails to targets that look like they are coming from trusted source to either reveal
important information or install different kinds of malware on target’s computer systems.
 Viruses, malware - can be detected by anti-virus software.
 Zero-day / 0 day / zero day:
→ computer-software vulnerability either unknown to those who should be interested in its mitigation (even
to developers) or known and without patch to correct it.
→ Until said vulnerability is mitigated, hackers can exploit it by malware injection to adversely affect
programs, data, additional computers or network.
→ Eexploit directed at zero-day is called zero-day exploit / zero-day attack.
→ security flaw which has not been publicly disclosed and for which software patch or remediation technique
is not available.
→ Developers discover zero-day attack, and they have zero days to mitigate (hence name).
 Log4Shell [2021]:
→ zero-day vulnerability (computer-software vulnerability either unknown to those who should be interested in its
mitigation or known and without patch to correct it) in Log4j (popular Java logging framework), involving arbitrary
code execution.
→ This vulnerability has existed unnoticed since 2013
→ Log4Shell had high severity.
→ Exploit is simple to execute and is estimated to affect hundreds of millions of devices.
→ one of worst cybersecurity flaws.

Page 317 of 719

 → This vulnerability is based on open-source logging library used in most applications by enterprises, government
agencies.
→ This vulnerability grants hackers access to application, and could potentially run malicious software on device or
servers.
 Log4j:
→ logging library for Java software
→ Java-based logging utility
→ software
→ widely used.
 Pegasus:
→ What:
 spyware tool
 Spyware spy on people through their phones.
 developed by NSO Group (Israeli firm).
→ Function:
 Pegasus works by sending exploit link, and if target user clicks on link, malware or code that allows surveillance
is installed on user’s phone.
 Once Pegasus is installed, attacker has complete access to target user’s phone.
→ Impact:
 Pegasus can send back target’s private data, including passwords, contact lists, calendar events, text messages,
live voice calls from popular mobile messaging apps.
 Target’s phone camera and microphone can be turned on to capture all activity in phone’s vicinity, expanding
scope of surveillance.
→ Judiciary:
 2021 Supreme Court observations made in Pegasus snooping case:
• state cannot keep secret from court merely on bogey of “national security” and expect judiciary to remain
mute spectator. claim has to be backed by evidence to prove that disclosure of information sought by court
would affect national security concerns.
• National security cannot be thing that judiciary shies away from, by virtue of its mere mentioning.
Supreme Court accepts that judicial review in national security matters is limited. However, mere mentioning of
national security by state does not render court mute spectator.
 Hermit:
→ Spyware with capability to affect both Android and iOS devices.
→ It is likely developed by one Italian spyware vendor.
 Cryptojacking / Crypto-jacking:
→ It is act of hijacking computer to mine cryptocurrencies against users will, through websites, or while user
is unaware. It is one cyber-attack wherein computing device is hijacked and controlled by attacker, and its
resources are used to illicitly mine cryptocurrency. One notable piece of software used for cryptojacking
was Coinhive, which was used in over 2/3 rd of cryptojacks before its 2019 shutdown. Cryptocurrencies
mined most often are privacy coins - coins with hidden transaction histories - such as Monero, Zcash.
 “Crime in India” report 2021:
→ On cybercrime:
 Increasing trend: India reported over 50,000 cases in 2021 (increase of nearly 6% over 2020). Maximum
cybercrime are from Telangana, UP, Karnataka, MH.
 SOVA:
→ It is one new mobile banking 'Trojan' virus which can stealthily encrypt Android phone for ransom and is
hard to uninstall. It was targeting Indian customers in 2022. So, later in 2022, CERT -In issued detailed
safety advisory against this new mobile banking ‘Trojan’ virus, SOVA, prowling in Indian cyberspace, which
stealthily encrypts android phone for ransom.
This banking malware targets bank customers using SOVA android Trojan with ability to harvest
usernames and passwords. This malware hides itself within fake android applications displaying log os of
legitimate applications like Chrome, Amazon, NFT platforms, and deceives users into installing them.
This malware captures user credentials when users access their bank accounts through net banking
applications. This version of SOVA is targeting over 200 mobile applications and its attacks can result in
‘large-scale’ financial fraud.
Value Addition:
 Zero-click attack:
→ helps spyware (like Pegasus) gain control over device without human interaction or human error.
→ Thus, all awareness about how to avoid phishing attack or which links not to click are pointless, if target is
system itself.

Page 318 of 719

 → exploits software which receive data even before it can determine whether what is coming in is trustworthy
or not, like email client.

{Spyware App} {Stalkerware App}
infect devices that are connected to internet infect devices that are connected to internet
disguise themselves as useful and send out stolen disguise themselves as useful and send out stolen
data to central servers without knowledge of users data to central servers without knowledge of users
can be installed remotely. can be installed only when someone has physical
access to digitally connected device.
accesses data usage pattern of device, gains access accesses data usage pattern of device, gains access
to photos, videos, other personal information of to photos, videos, other personal information of
user, and then passes it off to central server. user, and then passes it off to central server. It also
gives out location of device to master device which
controls stalkerware app.
Most stalkerware apps work in stealth mode with no
trace of this app ever being installed. Once installed,
such apps can allow master device to control,
intercept, even change one’s emails, text messages,
communication on social media platforms.
 Project Zero:
→ team of security analysts, employed by Google, tasked with finding Zero-day vulnerabilities (Zero-day / 0-
day is computer-software vulnerability either unknown to those who should be interested in its mitigation
or known but patch has not been developed.)
 TechSagar:
→ Repository of India’s cybertech capabilities.
→ supported by office of National Cyber Security Coordinator.
 Man-in-the-Middle Attack (MITM):
→ attack in form of eavesdropping where communication between users is monitored and modified by unauthorized
party.
→ Generally, attacker actively eavesdrops by intercepting public key message exchange and retransmits said message
while replacing with his own.
Question:
 Terms ‘WannaCry, Petya, Eternal Blue’ sometimes mentioned in news recently are related to Cyber attacks.
 In India, it is legally mandatory for - Service providers, Data centres, Body corporate - to report on cyber security
incidents.
Mains Link:
 Discuss different types of Cyber crimes and measures required to be taken to fight the menace. (UPSC 2020)

PLASTIC
News:
 2021:
→ Ganga is polluted with Microplastics of single-use plastic (SUP), secondary plastic products.
→ IISc researchers find one way to substitute for single-use plastics (SUP). By combining:
 non-edible oils; and
 cellulose (extracted from agricultural stubble)
IISc researchers made biodegradable, multi use polymer sheets.
 Importance: IISc made biodegradable, multi use polymer sheets can substitute for single-use plastic (SUP) that
may help mitigate problem of accumulating plastic waste in environment.
→ MoEFCC notifies Plastic Waste Management Amendment Rules, 2021.
 Background: India signed one resolution to draw up agreement (under UNEA) that will make it legally binding
for signatories to address full life cycle of plastics, from production to disposal.
→ Tamil Nadu launches ‘Meendum Manjappai’ awareness campaign on usage of cloth bags instead of single-use plastic
bags. [TN had already banned many types of plastic materials.]
 2022:
→ Environment ministry notifies - Guidelines on Extended Producer Responsibility for Plastic Packaging - under Plastic
Waste Management Rules, 2016 via Plastic Waste Management (Amendment) Rules, 2022.
→ One resolution at 2022 UN Environment Assembly (UNEA) held in Nairobi, hosted by UNEP, seeks to end plastic
pollution and create one international legally binding agreement by 2024.
 Significance:
• This resolution will be related to marine ecosystems also, and will include both binding and voluntary
approaches from member states.

Page 319 of 719

 • This development is considered most important environmental deal since 2015 Paris Agreement.
→ Tiny particles of plastics, called Microplastics, were detected in human blood for 1st time, according to one study by
researchers in Netherland.
→ In another step toward eliminating single-use plastic, Environment Ministry launches “Prakriti”.
→ Centre (MoEFCC) bans use of ‘single-use-plastic’ and now defines list of banned SUP items.
→ Himachal Pradesh will start one buy-back scheme in schools and colleges to purchase SUP items from students in bid
to instil sense of environmental preservation.
→ One study claims Microplastics help viruses survive longer in water, remain infectious. That is, plastic pollution is
bigger evil than previously imagined and can help keep viruses alive and infectious in freshwater for days.
 What is happening?: Layer of microbial cells or biofilm forms on surface of microplastics soon after they are
released into freshwater, this nutrient-rich coating becomes hospitable surface for microorganisms that hop
onto floating microplastics.
Viruses on microplastics remained alive in water for 3 days or more, Viruses associated with biofilm-
colonized pellets were more stable compared to those remaining in water.
→ NITI Aayog releases one report on plastic – “Report on Alternative Products and Technologies to Plastics
and their applications”.
→ S&T Ministry approves StartUp loan for manufacturing and commercialising compostable plastic, X crores
loan assistance provided to M/s TGP Bioplastics, one 1 st -generation start-up to mitigate usage of Single
Use Plastics (SUP). This Programme is supported by NIDHI-PRAYAS Scheme, NITI Aayog, and UNIDO.
→ Zerocircle (one Mumbai-based start-up) uses seaweed in its search for replacement to SUP.
 Zerocircle: After quitting her job at Google, Neha Jain launched Zerocircle, one startup that converts
seaweed into low-cost, eco-friendly plastic alternatives for packaging. Seaweed is considered one
potential resource for making bioplastics because it comes with low water footprint and land footprint.
Zerocircle uses largely red, brown, and green seaweed, which amounts to about 12,000 species. After
collecting seaweed, it is dried and turned into powder, which is then turned into final material. With
this, they make handbags, bags for clothes, film for food, and more plastic alternatives.
About:
 Single-use plastic (SUP):
→ What:
 SUP are plastic items that are used once and discarded. plastics with no reusability, and which do not actually
get recycled. disposable plastic items like grocery bags, food packaging, bottles, straws that are used only once
before they are thrown away, or sometimes recycled. GOI defines SUP as object made of plastic that is intended
to be used “only once” before being disposed off or recycled.
 Example - water bottles, straw, cups, chips wrappers, biscuits wrappers, chocolate wrappers
 SUPs are banned now by GOI in India because of:
• non-availability of alternatives;
• lack of adequate plastic waste management systems;
• low utility; and
• high littering potential.
→ Note:
 Petroleum-based plastic is non-biodegradable and usually goes into landfill where it is buried or it gets
into water and finds its way into ocean. In process of breaking down, it releases toxic chemicals
(additives that were used to shape and harden plastic) which make their way into our food and water
supply.
→ Status:
 As per Minderoo Foundation report (2021): SUP account for 1/3 rd of all plastic produced globally, with
98% manufactured from fossil fuels. Largest share of SUP is that of packaging – with as much as 95%
of all SUPs. India features in top 100 countries of SUP waste generation. India’s domestic production
of SUP is 8 million metric tonnes annually, and its import of 2.9 MMT. India’s per capita generation is
4 kg.
 Items banned in India:
• CPCB banned – earbuds; balloon sticks; candy and ice-cream sticks; cutlery items including plates, cups,
glasses, forks, spoons, knives, trays; sweet boxes; invitation cards; cigarette packs; PVC banners measuring
under 100 microns; polystyrene for decoration. Polythene bag: MoEFCC banned polythene bags under 75
microns in 2021. From 2022, ban will be extended to polythene bags under 120 micron. Sachets: According
to Plastic Waste Management Rules, 2016, there is also complete ban on sachets using plastic material for
storing, packing or selling gutkha, tobacco and pan masala. These items were banned mainly based on
difficulty of collection, and therefore difficulty in recycling.
 Items NOT yet banned in India:
• Plastic Packaging waste, one major contributor to much larger problem of plastic waste pollution, is not yet
covered under phaseout of SUP items.

Page 320 of 719

 • Mineral water bottles or plastic bottles of aerated drinks are unaffected by this ban, though, in popular
imagination, they are representative of ‘plastic pollution.’
 Enforcement of banned plastic items:
• Monitoring by CPCB: Ban will be monitored by CPCB from Centre and by SPCBs that will report to Centre
regularly.
• Stop raw materials supply: Directions were issued at National, State and local levels — for example, to all
petrochemical industries — to not supply raw materials to industries engaged in banned items.
• Directions to industries: SPCBs will modify or revoke consent to operate issued under Air / Water Acts to
industries engaged in SUP items.
• Fresh licensing required: Local authorities were directed to issue fresh commercial licenses with condition
that SUP items will not be sold on their premises, and existing commercial licences will be cancelled if they
are found to be selling these items.
• Encouraging compostable plastics: CPCB issued one-time certificates to 200 manufacturers of compostable
plastic and BIS passed standards for biodegradable plastic.
• Penalty: Those found violating ban can be penalised under Environment Protection Act, 1986 – which allows
for imprisonment, or fine or both. Violators can also be asked to pay Environmental Damage Compensation
by SPCB.
→ Concern:
 Harm environment: SUP also accounts for majority of plastic discarded – 130 million metric tonnes
globally in 2019 — all of which are burned, buried in landfills or discarded directly into environment.
 GHG emission: On current trajectory of production, it is estimated that SUP could account for 5 -10%
of GHG emissions by 2050.
 Previously, about 25 Indian States banned plastic at St ate level. However, these bans had very limited
impact in reality because of widespread use of these SUP items.
→ Other countries:
 Consensus on SUP in UN: In 2022, 124 countries, parties to United Nations Environment Assembly
(UNEA), including India, signed resolution to draw up one agreement which will in future make it legally
binding for signatories to address full life of plastics from production to disposal, to end plastic
pollution.
 Many countries have plastic bag baned with varying degrees of enforceme nt.
 Bangladesh: Bangladesh became 1 st country to ban thin plastic bags in 2002.
 China: China issued ban on plastic bags in 2020 with phased implementation.
 EU: EU baned certain SUP for which alternatives are available.
→ Conclusion:
 While total ban on use of SUP plastic sounds great idea, its feasibility seems difficult at this hour,
especially in absence of workable alternatives.
 Argument:
→
{for} {against}
plastic is not harmful if it is managed, collected and irreversible impact
recycled properly to other uses
plastic is cheap, lightweight and easy to produce. plastic is harmful to environment as it is non-
biodegradable, takes years to disintegrate.
Waste plastic bags are polluting land, water immensely
Plastic bags are threat to life of animals on land, marine
animals
Chemicals released by waste plastic bags enter soil and
make soil infertile.
Plastic bags impacts human health
Plastic bags are drainage problem.
 Plastic pollution:
→ Plastic waste.
→ Issue:
 Plastic production has risen exponentially in last decades and now amounts to some 400 million tons per year.
 Impacts on triple planetary crisis - climate change, biodiversity loss, pollution.
 By 2050 greenhouse gas (GHG) emissions associated with plastic production, use and disposal would account
for 15% of allowed emissions, under goal of limiting global warming to 1.5°C.
 Many marine and coastal species are affected by plastic pollution through ingestion, entanglement, etc.
 Some 11 million tonnes of plastic waste flow annually into the oceans. This may triple by 2040.
 On environment, marine life:
• Plastics can not decomposed for hundreds to thousands of years.
Page 321 of 719
 • Some marine species (zooplanktons) intakes smaller particles – including microplastics, and this makes
microplastics enter food chain.
• Some marine animals - whales, seabirds, turtles - unknowingly intakes plastics and often suffocate to death.
• open burning of plastics contributes to air pollution
 On humans:
• Marine plastic pollution reaches food chain. For example, microplastics have been found in tap water, beer,
and even salt.
• Consumption of plastic by humans is harmful because chemicals used to produce those plastics can be
carcinogenic.
• potentially affecting fertility, hormonal, metabolic and neurological activity
→ Efforts to beat plastic pollution:
 Global:
• Beat Plastic Pollution had been theme for World Environment Day.
 India:
• Many States and Union Territories have announced ban on single-use plastics (SUP) - carry bags, cups,
plates, straws, thermocol products.
• India pledged to eliminate single-use plastic (SUP) by 2022.
• Plastic Waste Management Rules, 2016 is amended in 2022 banning import of plastic waste SUVs.
• Government’s 3-stage ban strategy to end Single-Use Plastic (SUP):
 1st category of Single-Use Plastic (SUP) items to be banned are plastic sticks used in Balloons, Flags,
Candy, ice-cream, ear buds, thermocol used in decorations.
 2nd category: Plates, Cups, Glasses, cutlery - forks, spoons, knives, straws, and trays, wrapping and
packing films used in sweet boxes, invitation cards, cigarette packets, plastic banners (some).
 3rd category:
o non-woven bags (some).
→ Way Forward:
 We need binding resolution to limit plastic pollution. Example - resolution at 2022 UN Environment Assembly
(UNEA) held in Nairobi, hosted by UNEP, seeking to end plastic pollution and create one international legally
binding agreement by 2024 is great initiative towards path to binding resolution.
 Shift to circular economy can reduce plastics entering oceans, can reduce new plastic production, can save
governments billions of dollars, can reduce greenhouse gas (GHG) emissions, can create additional jobs – mainly
in global south.
 Plastic Waste:
→ MoEFCC notified Plastic Waste Management Rules, 2016, and Solid Waste Management Rules, 2016. Plastic waste
is part of solid waste and therefore, both rules - Plastic Waste Management Rules, 2016, Solid Waste Management
Rules, 2016- apply to managing plastic waste in India.
→ Plastic Waste Management Rules, 2016:
 It mandates minimising generation of plastic waste, avoiding littering, ensuring segregated storage of waste at
source, and handing it over. It mandates responsibilities of local bodies, gram panchayats, waste generators,
retailers, street vendors to manage plastic waste. It focuses on EPR on producers, importers, brand-owners. EPR
shall be applicable to both pre-consumer and post-consumer plastic packaging waste.
 Plastic Waste Management (Amendment) Rules, 2021:
• notified by MoEFCC. It made mandatory for thickness of plastic carry bags to be increased to 120 microns.
Prohibit manufacture, import, stocking, distribution, sale, use of products with low utility but high littering
potential.
 Plastic Waste Management (Amendment) Rules, 2022 [Environment Ministry]:
• Notified by Central Government (Min. of Environment) under Environment (Protection) Act, 1986 to amend
Plastic Waste Management Rules, 2016. This 2022 amendment rule contains - Guidelines on Extended
Producer Responsibility for Plastic Packaging.
• 2022 Guidelines on Extended Producer Responsibility for Plastic Packaging:
 Provisions:
o Coverage of EPR (Following plastic packaging categories are covered under EPR):
✓ Category I: Rigid plastic packaging
✓ Category II: Flexible plastic packaging of single layer or multilayer (more than one layer with
different types of plastic); plastic sheets and covers made of plastic sheet; carry bags; plastic
sachet or pouches.
✓ Category III: Multilayered plastic packaging (at least one layer of plastic and at least one layer
of material other than plastic).
✓ Category IV: Plastic sheet used for packaging; carry bags made of compostable plastics.
o This rule provides specifications for reuse, recycling, use of recycled plastic content, end-of-life
disposal of non-recyclable plastic packaging. Setting up one centralised online portal by Central

Page 322 of 719

 Pollution Control Board (CPCB) for registration, filing of annual returns by producers, importers,
brand-owners, plastic waste processors of plastic packaging waste. EPR target will be increased to
70% in 2022-23 and 100% from 2023-24 onwards. Recycling obligation for producers should be
50% for rigid plastics in 2024-25, 60% in 2025-26, 70% in 2026-27, 80% from 2027-28 onwards.
Environmental compensation shall be levied based upon polluter pays principle, with respect to
non-fulfilment of EPR targets by producers, importers, brand owners, for purpose of protecting
and improving quality of environment and preventing, controlling, reducing environment pollution.
Allow for sale and purchase of surplus EPR certificates. Thus setting up one market mechanism for
plastic waste management.
 Significance:
o Reduce pollution caused due to littered plastic waste. Promote development of new alternatives
to plastics. Provide roadmap for businesses to move towards sustainable plastic packaging. Provide
framework to strengthen circular economy of plastic packaging waste. Boost for formalization and
further development of plastic waste management sector.
 Challenges:
→ UN says plastic production boomed over last century, and trend is expected to continue in coming decades.
→ Countries are now struggling with managing amount of plastic waste they have generated.
→ It is not going to be easy task. Every day, tons of plastic waste are generated across India.
→ Tons of plastic waste generated are uncollected. [Though India’s consumption of plastic is lower than
world’s average]. About 60% of plastic waste in India is collected — that means remaining 40% tons remain
uncollected.
→ Significant amount of plastic ends up in landfills, rivers, oceans.
→ India does not have systems in place for effective segregation, collection, recycling.
→ lack of adequate plastic waste management systems.
→ No policy for recycling plastics. Also, objections to set up recycling plant because of environmental issues
raised by Pollution Control Boards of various States.
→ Single-use plastic (SUP) is good business, and it may continue.
→ Economics favour plastic production.
→ non-availability of alternatives
→ Microplastics is emerging field of study, and thus its exact risks on environment and human health are not
clearly known.
 Way Forward:
→ Awareness: Consumer needs to be informed about SUP ban through advertisements, newspaper, TV
commercials, or on social media.
→ Find sustainable alternatives: Companies need to invest in resear ch and development of alternative to
SUP.
→ In 2022, NITI Aayog released one report on plastic – “Report on Alternative Products and Technologies to
Plastics and their applications”.
→ Harmonization of global plastic production standards.
→ Extended Producer’s Responsibility.
→ Limit newly created plastic production.
→ Invest in circular recycling and waste management.
→ Stop fossil fuel subsidies.
→ Formalize plastic pollution clean-up.
→ Enforcement of ban orders is key.
→ Government should address important structural issues - policies to regulate use of plastic alternatives,
improve recycling, waste segregation management.
→ investment in research
→ development for alternatives to SUP
→ Government should perform thorough economic and environmental cost -benefit analysis.
→ Government should consider social and economic impacts for SUP ban to be successful.
→ Need of better recycling policies because resources are scarce.
→ Intensify efforts to recycle plastic [under Swachhbharatabhiyan]
→ Promoting biodegradable plastics, khadi bags, cotton bags.
→ In 2021, IISc made biodegradable, multi use polymer sheets can substitute for single -use plastic (SUP). This
IISc made should be produced in large.
→ Incentivising collection.
→ Charging producers for their waste, which will lead to rec overy, recycling
Note:
 Microplastic:

Page 323 of 719

 → Fragments of any type of plastic < 5 mm in length. They cause pollution by entering natural ecosystems
from variety of sources, including cosmetics, clothing, food packaging, and industrial processes.
 “Report on Alternative Products and Technologies to Plastics and their applications” (NITI Aayog) [2022]:
→ What:
 One report on plastics released by NITI Aayog in 2022. In this report, NITI Aayog suggested on plastic alternatives
and technologies to make plastic degradable.
→ On status:
 India produces 3.47 mn tn of plastic waste per year, out of which 60% is collected for recycling. Goa, Delhi &
Kerala have reported highest per capita plastic waste generation, while Nagaland, Sikkim and Tripura have
reported lowest per capita plastic waste generation.
 Globally, 97-99% of these plastics are derived from fossil fuel feedstock while remaining 1-3% come from bio
(plant) based plastics.
 Best Practices:
• India:
 Arunachal: Plastic banks were established in one district; Plastic was used in Road Construction in
variable districts.
 Delhi: Environmental compensation of INR 88,00,000/- levied for violation of PWM Rules.
 Tamil Nadu collection efficiency of plastic waste is 92%.
 Sikkim: Usage of plastic waste in road construction initiated.
 Uttarakhand: Use of plastic waste as fuel, Refuse Derived Fuel (RDF) and waste in energy plants is
proposed.
 Biodegradable cutlery: DRDO Lab DFRL has developed technology for biodegradable cutlery.
• World:
 Edible Seaweed Cups (Indonesia): Seaweed can grow up to 60 times faster than land-based plants,
making it important carbon sink.
 Algae-blended ethylene-vinyl acetate: One US-based firm has created algae-blended ethylene-vinyl
acetate transforming air and water pollution (ammonia, phosphates, and CO2) into plant biomass rich
in proteins.
 Zero plastic recycled paper bottle: One UK firm has invented only commercially available zero plastic
recycled paper bottle in world.
 Wood-based paper packaging: In 2020, one Scotland-based paper manufacturing company developed
sustainable wood-based alternative to plastic packaging.
 Biotransformation process: One UK-based company has developed one additive which, when added to
masterbatch of polyolefins, i.e., PE and PP, onsets degradation.
→ Its recommendations:
 Develop emerging technologies: Eg., additives can make plastics biodegradable polyolefins, such as
polypropylene, polyethylene.
 Use of Bio-plastics: It is cost-effective alternative to plastics.
 Appreciate contribution of informal sector and vulnerable groups in recycling waste.
 Use Extended Producer Responsibility (EPR) to minimize waste.
 Levelling and collection of compostable and biodegradable plastics.
 Transparency: Disclose data on waste generation, collection and disposal.
 Avoid greenwashing: Greenwashing is process of conveying misleading information about how company’s
products are more environmentally sound.
→ Environmentally friendly plastics:
 This NITI report mentions below types of environmentally friendly plastics:
• Bio-plastics: These encompass many materials that are either bio-sourced or biodegradable or both and are
made from renewable biomass resources, most often corn starch, sugarcane, cassava – which might be
either biodegradable or not.
• Biodegradable plastic: It means those plastics, other than compostable plastics, which undergo complete
degradation by biological processes under ambient environmental (terrestrial or in water) conditions, in
specified time periods, without leaving any microplastics, or visible, distinguishable or toxic residue, which
has adverse environmental impacts, adhering to laid down standards of BIS and certified by CPCB.
• Compostable plastics: Plastics that undergo degradation by biological processes during composting to yield
CO2, water, inorganic compounds and biomass, and do not leave toxic residue. These can be plant-based,
but can also be petroleum-based as well. BASF’s Ecoflex is one excellent example of compostable polymer,
which is partly petroleum-based but is compostable at industrial compost facilities.
Instead of using plastic made from petrochemicals and fossil fuels, compostable plastics are derived
from renewable materials like corn, potato, tapioca starches, cellulose, soy protein, lactic acid.
• Oxo-degradable/ Oxydegradable/ Oxo-biodegradable plastics: These plastics are conventional plastics such
as PE, which include additive to help them break down into smaller fragments, which could lead to
microplastic leakage in environment.
Page 324 of 719
  Prakriti [2022]:
→ What:
 mascot / event to spread greater awareness about small changes that can be sustainably adopted in lifestyle for
better environment.
 Launched by Environment Ministry in another step toward eliminating single-use plastic.
→ During this event, following green initiatives were launched for plastic waste management:
 National Dashboard on Elimination of Single Use Plastic and Plastic Waste Management (by MoEFCC):
• This aims to connect all stakeholders including Central Ministries / Departments, State / UT Governments,
etc. through one platform and track status and progress made for elimination of single use plastic & effective
management of plastic waste.
 Extended Producer Responsibility (EPR) Portal for Plastic Packaging (by CPCB):
• This portal will help in overall operational functions like improving accountability, traceability, transparency
and facilitating ease of reporting compliance to EPR Obligations by Producers, Importers and Brand-owners.
 Mobile App for Single Use Plastics Grievance Redressal (by CPCB):
• This app will allow citizens to check sale / usage / manufacturing of single use plastic in their region and
tackle plastic menace.
 Monitoring module for single use plastic (by CPCB):
• This will be for local bodies, State pollution control board, CPCB, etc. to invent details of single use plastic
production, its sale & usage, etc. in commercial establishments at district level, and on-ground enforcement
of ban on single use plastics.
 Industrial production of Graphene from Waste Plastic (by G.B. Pant NIHE & NRDC):
• It will promote more industries to come forward to upcycle plastic waste.
 National Initiative for Developing and Harnessing Innovations (NIDHI):
→ It is meant for setting up incubators, seed funds, accelerators and ‘Proof of concept’. PRomoting and Accelerating
Young and Aspiring innovators and Startups (PRAYAS) (under NIDHI scheme) is for supporting innovators and
entrepreneurs with PRAYAS grants, to develop prototypes.
Glossary:
 Greenwashing / Green sheen:
→ One form of advertising or marketing spin in which green PR and g reen marketing are deceptively used to
persuade public that organization's products, aims and policies are environmentally friendly.
Value Addition:
 Project REPLAN:
→ REducingPLAstic in Nature
→ launched by KVIC, as part of its commitment to Swachh Bharat Abhiyaan
→ waste plastic is collected, cleaned, chopped, beaten, treated for softness. After that, it is mixed with paper
raw material i.e. end product is cotton rags pulp [pulp + plastic waste] i.e. plastic -mixed handmade paper.
 Ideonellasakaiensis:
→ Plastic eating Bacteria.
→ bacterium from genus Ideonella and family Comamonadaceae.
→ capable of breaking down and consuming plastic polyethylene terephthalate (PET) as sole carbon and
energy source.
→ bacterium was originally isolated from sediment sample taken outside of plastic bottle recycling facility in
Sakai, Japan.
 Global Partnership on Marine Litter (GPML):
→ launched by UN
→ multi-stakeholder partnership that brings together all actors working to prevent marine litter and plastic
pollution.
Question:
 Central Ground Water Authority (CGWA) has been constituted under Environment (Protection) Act, 1986 to regulate and
control development and management of groundwater resources in India.
 In India, Extended Producer Responsibility (EPR) was introduced as one important feature in E-Waste (Management and
Handling) Rules, 2011. EPR is one policy approach under which producers are given significant responsibility – financial
and / or physical – for treatment or disposal of post-consumer products.
 Bisphenol A (BPA), cause of concern, is one structural / key component in manufacture of Polycarbonate plastics. BPA
stands for bisphenol A, industrial chemical that has been used to make certain plastics and resins since 1950s. BPA is
found in polycarbonate plastics and epoxy resins. Polycarbonate plastics are often used in containers that store food and
beverages, such as water bottles.
 Triclosan considered harmful when exposed to high levels for long time, is most likely present in Toiletries. Triclosan is
antibacterial and antifungal agent present in some consumer products, including toothpaste, soaps, detergents, toiletries
toys, and surgical cleaning treatments.
Mains Link:

Page 325 of 719

  What is single-use plastic and what are the concerns associated with it? How can it be successfully phased out in the
country? (15M)
 Enumerate the steps taken by India to tackle plastic pollution in the country. Do you think a legally binding global treaty
on plastics and plastic pollution is the way forward? Critically examine. (250 words)
 Critically analyze Plastic Waste Management Amendment Rules. 2021. Discuss how the Plastic Waste Management
Amendment Rules will be implemented?

MARS
(GS1, GS3)
News:
 2021:
→ Since its landing on Mars in 2018, InSight lander has recorded many quakes on Mars. Recent quakes originated in
region called Cerberus Fossae.
→ Perseverance rover landed on Mars at Jezero Crater. NASA successfully flew its tiny helicopter Ingenuity on Mars.
For 1st time, MOXIE device was able to produce oxygen (O2) from thin Martian atmosphere
→ Tianwen-1 landed safely on Mars at Utopia Planitia.
→ Perseverance rover is exploring Jezero Crater on Mars and attempting to collect rock samples.
→ Perseverance rover successfully collected its 1strock sample for return to Earth.
→ Images taken by NASA’s Perseverance rover confirm that Mars’ Jezero crater was once quiet lake, fed steadily by
small river, billions of years ago.
→ NASA’s Perseverance rover clicked view of “South Seitah” region of Mars’ Jezero Crater. Images reveal ridge
nicknamed “Faillefeu”.
 2022:
→ Perseverance rover completes one full Earth year on Mars after its successful landing in 2021.
→ ExoMars mission is delayed after ESA suspended all cooperation with Russia’s Roscosmos.
→ NASA says its InSight Mars lander detected largest quake ever observed on another planet.
→ ISRO used ‘S-band’ radio signals from Mangalyaan to study solar corona and to locate area of Sun where
temperature rises abruptly.
 How:
• ISRO scientists utilised solar conjunction event, when Earth and Mars are on opposite sides of Sun.
• During it, radio signals from Mangalyaan pass through solar corona.
 Significance:
• Mangalyaan’s radio signals passing through solar corona offers unique opportunity to study solar dynamics.
→ One small box (MOXIE) sent with Perseverence rover of NASA has produced oxygen in Mars with components from
Mars’s atmosphere. It is 1st instance of utilisation of resources in Mars planet’s atmosphere to meet human needs.
[Importance: This MOXIE project can be scaled up ahead of human missions to continuously produce oxygen at rate
of several 100 trees. On this scale, it can also fuel rocket to bring astronauts back home].
→ Mars Orbiter craft non-recoverable; Mangalyaan mission over, confirms ISRO: ISRO confirms that Mars Orbiter craft
has lost communication with ground station, and it's non-recoverable and Mangalyaan mission has attained end-of-
life. [Despite being designed for life-span of 6 months as one technology demonstrator, MOM / Mangalyaan lived for
about 8 years in Martian orbit].
About:
Note:
 Marsquake:
→ What:
 Quake which, much like earthquake, would be shaking of surface or interior of planet Mars as result of sudden
release of energy in planet's interior, such as result of plate tectonics, which most quakes on Earth originate
from, or possibly from hotspots such as Olympus Mons or Tharsis Montes.
 On Earth, quakes are caused by shifts in tectonic plates. Mars, however, does not have tectonic plates, and its
crust is one giant plate. Therefore, ‘marsquakes’ are caused due to stresses that cause rock fractures or faults in
its crust.
→ Significance:
 Detection and analysis of marsquakes could be informative to probing interior structure of Mars, as well as
identifying whether any of Mars's many volcanoes continue to be volcanically active or not.
 Near-term interest in Mars:
→ Mars is located in near backyard.
→ planet that humans can aspire to visit or to stay for longer duration.
→ Mars had flowing water and atmosphere in distant past
→ Mars perhaps had conditions to support life.
 Jezero crater:
→ on Mars

Page 326 of 719

 → Billions of years ago, it was quiet lake, fed steadily by small river.
→ But, today it is dry, wind-eroded depression.
→ It endured flash floods. This flooding was energetic enough to sweep up large boulders and deposit them into
lakebed, where massive rocks lie today.
 Missions to Mars / Mars Missions:
→ Fact:
 USA is 1st country to deploy rovers on Mars (Red Planet).
 Chian is 2nd country to send rover to explore Mars (Red Planet).
 USSR – 1 st country to carry out Mars landing.
 USA, China - only countries to send rovers on Mars.
→ United States:
 Mars Pathfinder Mission, 1996.
 Viking 1 rover
 Viking 2 rover
 Opportunity rover
 Spirit rover
 Perseverance [2020]:
• What:
 Mars mission (spacecraft) of NASA
 launched aboard United Launch Alliance Atlas V.
 Perseverance rover landed on Jezero Crater, Mars.
• Aim:
 seeks signs of ancient life (astrobiology), looking for biosignatures
 collect samples of Mars rock and bring to Earth.
 explore Mars
 study climate and geology of Mars
 Demonstrate technology for future Mars missions.
• Composition:
 Drills
 cameras
 lasers.
• Significance:
 Unique instrument called Mars Oxygen ISRU Experiment (MOXIE):
o prototype oxygen generator on Red Planet. 1st ever manufacture of molecular oxygen (O2) on
Mars using carbon dioxide (CO2) from CO2-rich Mars atmosphere to meet human / astronauts
requirements of Perseverance spacecraft.
o It was sent by NASA on Perseverence and made by MIT. It works like tree, splitting CO2 absorbed
from atmosphere to produce pure oxygen. This instrument produced 6 grams of oxygen per hour,
similar to moderate-sized tree.
 Ingenuity Helicopter:
o 1st ever small robotic helicopter to fly on Mars / any planet other than Earth.
 Rock samples:
o It will bring back rock samples from Mars,for analysis in laboratories on Earth to look for bio-
signatures / signatures of present or past life.
• Functions performed so far:
 It has collected 1st rock cores from Mars.
 It has served as base station for Ingenuity helicopter.
 It has extracted oxygen from thin Martian air.
 It broke record for most distance driven by rover on Mars in one single day.
 It has tested 1st prototype oxygen generator on Red Planet, called MOXIE.
 Curiosity, 2011
 Insight [2018]:
• What:
 NASA’s mission on planet Mars.
 part of NASA’s Discovery Program.
• Objective:
 Look deep under Martian surface
 Study Mars’ interior
 Listen for marsquakes (seismic events similar to earthquakes on Earth).
 develop map of Mars’ deep interior [by using seismic waves generated by marsquakes].
 detect seismology (Marsquakes)
 measure temperature
Page 327 of 719
  It seeks to answer one of science’s most fundamental questions: How did terrestrial planets form?
• Significance:
 understand how other rocky planets, including Earth, were formed.
 InSight would look deep beneath surface of Mars, detecting fingerprints of processes of terrestrial
planet formation, as well as measuring its vital signs: pulse (seismology), temperature (heat flow
probe), reflexes (precision tracking).
→ Europe:
 ExoMars [2016]:
• What:
 Exobiology on Mars
 astrobiology programme of European Space Agency (ESA) and Roscosmos (Russian space agency).
 To address question of whether life has ever existed on Mars.
• Objective:
 To search for signs of past life on Mars
 investigate how Martian water and geochemical environment varies
 investigate atmospheric trace gases and their sources
 demonstrate technologies for future Mars sample-return mission.
• How:
 Land ESA’s rover at site which has high-potential for finding well-preserved organic material,
particularly from history of MARS planet.
• Components:
 This programme comprises 2 missions:
o 1stlaunched in 2016. It consists of Trace Gas Orbiter (TGO) and Schiaparelli (entry, descent, landing
demonstrator module). TGO will search for evidence of methane (CH4), other trace atmospheric
gases that could be signatures of active biological or geological processes. Schiaparelli probe
crashed during its attempt to land on Mars.
o 2nd mission, comprises one rover and surface platform, and is planned for 2022.
• Significance:
 It will help understand history of water on MARS planet and if life ever existed.
→ China:
 Tianwen-1:
• Mars mission / probe / spacecraft of China
• uncrewed
• Component:
 orbiter
 lander
 rover (named Zhurong)
• Objective:
 Investigate Martian atmosphere and climate at Mars surface.
 Explore Martian soil – analyzing surface material composition.
 Study geology of Mars
 create geological map of Mars.
 Potentially find water-ice deposits.
 Understand electromagnetic field and gravitational field of Mars.
• Significance:
 China becomes 3rd nation to achieve successful soft landing on Mars, after Soviet Union, USA.
 China becomes 2nd country, after US, to send rover to surface of Mars.
 China becomes 1st country to carry out orbiting, landing, roving operation during its 1st mission to
Mars.
 Yinghuo-1:
• China had tried to launch its 1st mars mission - Yinghuo-1, though it failed after spacecraft burnt while still
in Earth’s atmosphere.
→ UAE:
 Hope Mars Mission [2020]:
• What:
 Mission to Mars
 UAE’s 1st Mars mission.
 Mars orbiter spacecraft
 officially called Emirates Mars Mission (EMM)
 ‘Hope’ is the orbiter
 1st interplanetary mission for Arab World.
• Objective:
Page 328 of 719
  study weather, climate of Mars
 study atmosphere of Mars
 study presence of hydrogen and oxygen in atmosphere
 study why Mars is losing hydrogen gas and oxygen gase to space.
• Significance:
 Known fact that Mars (Red Planet) was once habitable (water, organic material). Therefore,
understanding Mars’ pastcan help scientists understand future of our Earth.
→ India:
 Mangalyaan.
 Mars Orbiter Mission (MOM) / Mangalyaan [2013]:
→ What:
 One space probe orbiting Mars since 2014. It was launched in 2013 by ISRO. It was India's 1 st interplanetary
mission and it made ISRO 4th space agency to achieve Mars orbit, after Roscosmos, NASA, and ESA. It made India
1st Asian nation to reach Martian orbit and 1st nation in world to do so on its maiden attempt.
This mission was one "technology demonstrator" project to develop technologies for designing,
planning, management, and operations of interplanetary mission. MOM mission is primarily technological
mission to study various aspects of Mars.
→ Objective:
 Study of Martian atmosphere. Study of Martian surface features. Morphology. Mineralogy.
→ Feature:
 Scientific payloads used - Mars Color Camera (MCC); Methane Sensor for Mars (MSM); Lyman Alpha Photometer
(LAP); Thermal Infrared Imaging Spectrometer (TIS); Mars Exospheric Neutral Composition Analyser (MENCA).
→ Status:
 Despite being designed for life-span of 6 months as one technology demonstrator, MOM / Mangalyaan lived for
about 8 years in Martian orbit.
 In 2022, ISRO confirmed that Mars Orbiter craft has lost communication with ground station, and it's non-
recoverable and Mangalyaan mission has attained end-of-life.
Question:
 Mangalyaan launched by ISRO is also called Mars Orbiter Mission and it made India only country to be successful in
making its spacecraft orbit Mars in its very 1st attempt.
Mains Link:
 Discuss the significance of the Perseverance mission.
 Discuss the significance of the Tianwen-1 mission.
 Discuss the significance and objectives of ExoMars mission.

DIGITAL LENDING
News:
 2021:
→ RBI Working Group (WG) on digital lending, including lending through online platforms and mobile apps
submits its recommendations.
→ RBI suggests law to regulate digital lending.
→ Experts says bringing digital lenders under RBI regulation will help weed out bad apples and ensure only
serious players survive because cost compliance may be too high for mischief makers.
 2022:
→ RBI cancels Certificate of Registration (CoR) issued to P C Financial Services Pvt Ltd, New Delhi, which
primarily engages in mobile app-based lending operations through app called ‘Cashbea n’, on ground of
violation of RBI’s Fair Practices Code.
→ RBI publishes 1 st set of norms to regulate digital lending. [This follows up on recommendations made by
working group set up in 2021].
→ GOI (Finance Min.) asks RBI to prepare one so-called approved ‘white list’ of digital lending apps to stamp
out (end) those using unethical means to exploit vulnerable customers. Ministry of Electronics and IT will
ensure that only apps on approved list (white list) are hosted on app stores.
 Reason: Concern about increasing instances of illegal loan apps offering loans / micro credits,
especially to vulnerable and low-income group people at exorbitantly high interest rates and
processing / hidden charges, and predatory recovery practices invol ving blackmailing and criminal
intimidation. Possibility of money laundering, tax evasion, breach of data privacy, misuse of
unregulated payment aggregators, shell companies, defunct NBFCs for perpetrating such actions.
About:
 What:
→ lending through digital / online platforms, mobile apps.
 Benefits:
→ potential for more fair, efficient, inclusive access to financial products, services.
Page 329 of 719
 → FinTech-led innovation is now at core of design, pricing, delivery of financial products, services.
→ Ease of doing lending: Digital lenders disburse loans and collect repayments remotely through digital
channels, such as bank accounts, e-commerce accounts, or mobile wallets integrated with partner (or) 3 rd
party integration. Transparency: These cashless channels improve ope rational efficiency and reduce fraud
by providing clear audit trail.
→ It facilitates speedy disbursal and helps lower costs of lending.
 Status:
→ Lending through digital mode relative to physical mode in India is still at nascent stage in case of banks.
But, there is strong growht of digital lending in India.
→ Strong growth in digital lending indicates huge untapped credit potential in India which can be bridged
efficiently through use of technology.
 Issues:
→ Instances of breach of data, unfair business practice s, frauds, widespread defaults, digital unawareness
and high-handed loan recovery practices by digital lenders.
→ Digital lenders attract borrowers with promise of loans in quick and hassle -free manner. But, excessive
rates of interest and additional hidden charges are demanded from borrowers.
→ Digital lenders / platforms adopt unacceptable and high -handed recovery methods.
→ Companies lure customers by small-size loans, which can be paid back in weeks with some interest.
However, if borrower fails to re pay this amount, it gets compounded at about 10% per month, making it
difficult for borrower to repay. This loan is sometimes masked as service called Buy Now, Pay Later (BNPL),
which allows shoppers to buy something but pay for it later. These loans mostly targe t young, new-to-
credit, cash-strapped.
→ Digital lenders misuse agreements to access data on mobile phones of borrowers.
→ 2021 RBI panel on digital lendingfound that about 600 out of 1100 lending apps available for Indian Android users
across 80 application stores are illegal apps. And, this number of illegal lending apps will grow because user
downloading these lending apps cannot identify if they are legitimate apps or not. It is also likely that many copycat
apps, websites will mushroom across internet. These illegal apps could collect user’s personally identifiable
information (PII), financial data, other sensitive details, which can then be used to compromise user’s accounts, carry
out phishing attacks and identity theft.
 RBI order / commandments to banks on digital lending:
→ Names of digital lending platforms engaged as agents shall be disclosed on website of banks / NBFCs.
→ Digital lending platforms engaged as agents shall be directed to disclose upfront to customer, name of
bank / NBFC on whose behalf they are interacting with that customer.
→ Immediately after sanction but before execution of loan agreement, sanction letter shall be issued to
borrower on letter head of bank / NBFC
→ Copy of loan agreement alog with copy each of all enclosures mentioned in loan agreement shall be
furnished to all borrowers at time of sanction / disbursement of loans.
→ Effective oversight and monitoring shall be ensured over digital lending platforms engaged by banks /
NBFCs.
→ Creation of awareness about grievance redressal mechanism.
 Way Forward:
→ Balanced approach needs to be followed so that regulatory framework supports innovation while ensuring
data security, privacy, confidentiality, consumer protection.
Note:
 2021 RBI panel on digital lending:
→ Finding:
 About 600 out of 1100 lending apps available for Indian Android users across 80 application stores are illegal
apps. And, this number of illegal lending apps will grow because user downloading these lending apps cannot
identify if they are legitimate apps or not. It is also likely that many copycat apps, websites will mushroom across
internet. These illegal apps could collect user’s personally identifiable information (PII), financial data, other
sensitive details, which can then be used to compromise user’s accounts, carry out phishing attacks and identity
theft
→ Recommendations:
 Separate legislation should be enacted to oversee digital lending.
 Set up nodal agency to examine Digital Lending Apps.
 Self-Regulatory Organisation should be set up for participants in digital lending ecosystem.
 Develop technology standards. And, compliance with these standards as pre-condition for offering digital
lending services.
 Disbursement of loans should be made directly into bank accounts of borrowers.
 All data collection must require prior consent of borrowers. Data itself must be stored locally.
 RBI 2022 1st set of norms / guidelines to regulate digital lending:

Page 330 of 719

 → Provision:
 No 3rd party: All loan disbursals will be between bank account of borrower and RBI regulated digital lender. Any
charge payable to 3rd party (such as Lending Service Providers) will be paid by lender (such as bank) and not
borrower.
 Only need-based data collection.
 Only permitted entities by RBI or under other laws are allowed to lend.
 In any digital loan, one standardized Key Fact Statement (KFS) must be provided to borrower.
 Regulated entities and LSPs working with them must also have nodal grievance redress officer.
 Borrower must have “right to forget” of collected data.
 Name, address etc. are allowed but no biometric information of borrower can be stored by Digital lending apps
(DLAs).
 Reporting of all lending activities should be done to Credit Information companies (CICs).
 Borrower can exit digital loan by paying principal and interest after cooling-off period / look-up period.
→ Benefit:
 Guidelines will help in protecting consumers from harassment, breach of data, etc.
Mains Link:
 Discuss the concerns associated with digital lending in the country.

ROAD / ROADWAY
News:
 2021:
→ Union government launches scheme for Good Samaritan.
 2022:
→ As per ICRA Limited (ICRA), road connectivity project under Bharatmala Pariyojana Programme (BMP) is only 23%
completed, 60% awarded and is projected to be completed by 2028 (late by 6 years). Delay reasons: It is mainly due
to delay in land acquisition, rise in projected cost, Covid19-related disruptions etc.
→ NCRB releases Accidental Deaths & Suicides in India (ADSI) report 2021.
→ MoRTH issues notification on standardising process for issuance of International Driving Permit (IDP). Under Geneva
Convention on Road Traffic [1949], India is required to issue IDP for acceptance of same in other countries.
→ Cyrus P. Mistry, former Chairman of Tata Group dies in car crash in Maharashtra. It has turned focus on whether
compulsory use of seat belts in cars — including by passengers in rear seat — can save lives during such accidents.
→ Road Transport Ministry says it will soon make rear seat belt alarm mandatory, in bid to nudge all occupants of 4-
wheeler to buckle up for their safety.
About:
 Road Accident:
→ Status:
 Road Transport Ministry said that during 2017, shocking 26,896 people lost their lives due to non-use of seat
belts with 16,876 of them being passengers.
 NCRB’s Accidental Deaths & Suicides in India (ADSI) report 2021 says that deaths in road accidents went up by
17% from 2020. In 2021, 1.55 lakh people died in accidents on Indian roads, up from 1.33 lakh in 2020. Total
road accidents reported was 4.03 lakh in 2021. Maximum number of cases were reported in Tamil Nadu. Reasons
were speeding that caused 87,000 deaths, accounting for over ½ of all deaths, while dangerous and careless
driving caused over 42000 deaths.
→ Mechanisms to prevent death in car accident?
 Seat belt: 3-point seat belt is one low-cost restraint system that prevents occupants of vehicle from being thrown
forward in crash. Seat belt slows occupant at same rate as vehicle, distributing physical force in crash across
stronger parts of body such as pelvis and chest. Road Transport Ministry said that during 2017, shocking 26,896
people lost their lives due to non-use of seat belts with 16,876 of them being passengers.
 Seat Belt + Airbag: Even if vehicle is fitted with airbag, force at which unrestrained occupant strikes airbag can
cause serious injuries. So, seatbelt works in tandem with airbag. Air-bag deployment reduced mortality by 63%
(IIT Delhi Study).
 Head restraints: These are found either as adjustable models or moulded into seats, and prevent whiplash injury
(sudden backwards and forward movement of head-on collision).
→ Indian regulation:
 Ministry of Road Transport and Highways issued one draft notification providing for 3-point seat belts to be
provided in all vehicles (up to 8-seater vehicles).
 Motor Vehicles (Amendment) Act, 2019 requires occupants of passenger vehicle to wear seat belt for driver and
passenger or else there’s fine. Evidently, although cars are equipped with seat belts, enforcement for rear seat
occupants is virtually absent in India.
→ Initiative:
 Good Samaritan Scheme [2021].

Page 331 of 719

  Pradhan Mantri Suraksha Bima Yojana (PMSBY) [2015].
→ Way Forward:
 Institute evidence-based, India-specific and effective road safety policies. Better road design and
maintenance of road and traffic infrastructure. Removal of medians on inter -city highways and
replacement with steel guard rails or wire rope barriers. Awar eness of use of seat belts and installing
airbags. Use of EU’s General Safety Regulation that requires new vehicles to incorporate advanced
emergency braking technology that launches automatically when collision is imminent. People should
drive low speed – awareness.
 Initiative:
→ Pradhan Mantri Gram Sadak Yojana (PMGSY) [2000].
→ Bharatmala.
Note:
 Pradhan Mantri Gram Sadak Yojana (PMGSY) [2000]:
→ Objective:
 To provide connectivity, by way of all-weather road to unconnected habitations.
→ Feature:
 Funding: Union Government bears 90% for NE States, Himalayan States. Union Government bears 60% for other
States.
 PMGSY – Phase I: 100 % centrally sponsored scheme. providing road connectivity and upgradation of existing
rural roads
 PMGSY – Phase II: upgradation of existing rural road network.
 PMGSY-III: to consolidate many roads in States. It involves consolidation of Through Routes and Major Rural
Links connecting habitations to Gramin Agricultural Markets (GrAMs), Higher Secondary Schools, Hospitals.
Funds - 60:40 between Centre and State for all States except for NE states, HP, Uttarakhand for which it is 90:10.
→ Road Connectivity Project for Left Wing Extremism (LWE) Affected Areas [2016]:
 envisaged in LWE States
 It includes Other District Roads (ODRs), Village Roads (VRs), and upgradation of existing Major District Roads
(MDRs) that are critical from security point of view.
 Some bridges on these roads critical from security angle are also funded.
→ Challenges:
 Lack of dedicated funds. Limited involvement of Panchayati Raj Institutions. Inadequate execution. Inadequate
contracting capacity. Less working season. difficult terrain particularly in Hill States. Scarcity of construction
materials. Security concerns particularly in Left Wing Extremism (LWE) areas.
 Bharatmala / Bharatmala Pariyojana ('India garland project') [2015]:
→ What:
 It is one centrally-sponsored and funded Road and Highways project of GOI. It is single largest outlay for
government road construction scheme. This project will build highways. It will cover entire string of Himalayan
territories etc, and will also cover Indo-Myanmar border in Manipur, Mizoram. It is umbrella program for
highways sector that focuses on optimizing efficiency of road traffic movement across India by bridging critical
infrastructure gaps.
→ Feature:
 Special emphasis will be given on providing connectivity to far-flung border and rural areas including tribal and
backward areas.
 It will interconnect through minimum 4-lane highway by raising number of corridors, National Highways by
interconnecting logistics parks, inter-corridors (IC), Multi-Modal waterway ports.
 This ambitious umbrella programme will subsume all existing Highway Projects including flagship National
Highways Development Project (NHDP) [1998].
 It is both enabler and beneficiary of other key GOI schemes, such as Sagarmala, Dedicated Freight Corridors,
Industrial corridors, UDAN-RCS, BharatNet, Digital India, Parvatmala, Make in India.
→ Component:
 Green Field Expressway; National Corridor Efficiency Improvement; Economic Corridor; Coastal Road & Port
Connectivity; Inter Corridor and Feeder Route; International Connectivity and Broader Road.
 Border Road Organisation (BRO):
→ What:
 Org. under Ministry of Defence. It is engaged in road construction usually in border areas to give connectivity to
difficult and inaccessible regions of country.
→ Composition:
 staffed by officers and troops from, Indian Army’s Corps of Engineers, Military Police, army personnel etc.
 Good Samaritan Scheme [2021]:
→ Feature:

Page 332 of 719

  Anyone who saves life of road accident victim by rushing him / her to hospital within “golden hour” will get cash
reward.
 Each Good Samaritan would also receive certificate of appreciation.
 Individual can be awarded maximum of 5 times in one year.
 national-level awards each year for worthiest Good Samaritans.
 Integrated Road Accident Database (iRAD):
→ What:
 initiative of Ministry of Road Transport and Highways (MoRTH), Government of India funded by World Bank.
 Centralised Accident Database to host and access all accident related data by various departments /
stakeholders.
→ Objective:
 To improve road safety in India.
→ How:
 Establishment of accurate and uniform road accident data collection mechanism from all over India.
 iRAD mobile & web application is developed.
 Training & handholding support to stakeholder departmental users through State / district roll out managers &
master trainers.
 This will facilitate road accident data collection by 4 stakeholder departments: Police, Transport, Highways,
Health Departments.
 Through collection of road accident data from all over India, road accident database will be developed. Collected
data will be analysed using different data analytics technique for identification of accident prone areas and
causes of accidents. Analysis output will be represented in appropriate dashboards, accessible to higher
authorities of stakeholder departments and MoRTH. And accordingly strategy will be formed for reduction of
number of road accident in India and enhance road safety.
 National Informatics Centre Services Inc. (NICSI)-India & IIT Madras have been jointly entrusted to carry out
design, Development, Training, and implementation of iRAD project, along with research & analysis activities.
 ICRA Limited (ICRA) [1991]:
→ What:
 It is one Indian company, independent and professional investment information and credit rating agency. It was
originally named Investment Information and Credit Rating Agency of India Limited (IICRA India). It was one joint-
venture between Moody's and various Indian commercial banks and financial services companies. It changed its
name to ICRA Limited, and went public in 2007, with listing on BSE and NSE.
 Accidental Deaths & Suicides in India (ADSI) report 2021 [NCRB]:
→ On road accident:
 Deaths in road accidents up by 17% from 2020. In 2021, 1.55 lakh people died in accidents on Indian roads, up
from 1.33 lakh in 2020. Total road accidents reported was 4.03 lakh in 2021. Maximum number of cases were
reported in Tamil Nadu.
 Reasons: Speeding caused 87,000 deaths, accounting for over 1/2th of all deaths, while dangerous and careless
driving caused over 42000 deaths.
 Convention on Road Traffic / Geneva Convention on Road Traffic [1949]:
→ One international treaty promoting development and safety of international road traffic by establishing certain
uniform rules among contracting parties. This convention addresses minimum mechanical and safety equipment
needed to be on board and defines identification mark to identify origin of vehicle. This Convention was prepared
and opened for signature by UN Conference on Road and Motor Transport held at Geneva in 1949. This conference
also produced Protocol on Road Signs and Signals.
→ India is signatory.
 International Driving Permit (IDP):
→ Those seeking to drive abroad can apply for IDP. It is one official travel document that is authorised by UN issued to
tourists travelling to foreign countries. It is one official translation of our driver's license issued in our home country.
This document essentially states that we possess valid driver's license and it translates our license documents into
number of languages so authorities abroad are able to verify and understand our driving credentials.
Mains Link:
 Road traffic accidents are a leading cause of death in India, and a major contributor to socio-economic losses, disability
burden, and hospitalization. Discuss (15M)

BALANCE OF PAYMENTS / BALANCE OF INTERNATIONAL PAYMENTS (BOP)

News:
 2022:
→ Min. of Finance (Department of Economic Affairs) in its ‘Monthly Economic Review’ report for May 2022 highlights 2
key areas of concern for Indian economy: Fiscal Deficit and CAD.
 This report say:

Page 333 of 719

 • World is looking at distinct possibility of widespread stagflation. India, however, is at low risk of stagflation,
because of its prudent stabilization policies, pointing towards stable economic condition of India. However,
this report points towards ‘twin deficit’ problem i.e., increased FD and CAD.
• India is expected to witness slowing growth and faces upside risk to fiscal deficit owing to recent excise duty
cuts on fuel, but India has low risk of stagflation owing to prudent stabilisation policies.
• On Fiscal deficit: Fiscal deficit may be high due to cuts in excise duties on diesel and petrol.
• On CAD: Higher import bills may increase CAD. Costlier imports such as crude oil and other commodities
will not only widen CAD but also depreciate rupee. Weaker rupee will, in turn, make future imports costlier.
• On pulling out of funds from emerging markets: Rupee can also weaken if, in response to higher interest
rates in western economies especially US, FPI continue to pull out money from Indian markets, which too
will hurt rupee and further increase CAD.
→ India’s current account balance for 4th quarter of FY 2021-22 shows decrease in deficit (CAD) to 1.5% of GDP from
2.6% of GDP in Q3 FY 2021-22.
 Reasons:
• Robust performance by computer and business services, net service receipts rose.
• Remittances by Indians abroad also rose.
• Decrease of India’s trade deficit.
• Merchandise export overcame higher import bills: Geopolitical tensions and supply chain disruptions led to
crude oil and commodity prices soaring. Rise in prices of coal, natural gas, fertilizers, and edible oils has
added to pressure on trade deficit. However, with global demand picking up, merchandise exports have also
been rising.
 Future CAD predictions:
• This decrease in CAD is temporary: India’s CAD is likely to widen to around 3-3.5% of GDP in 2022-23, due
to FED interest rates hike and outflow of FII and FDI from Indian market.
→ As per RBI one monthly bulletin, USA surpasses UAE to become top remittance source for India.
 Highlights:
• USA surpasses UAE to become top remittance source for India. Reasons: Economic recovery in USA is one
of important drivers of India’s remittances growth as it accounts for 23% of total remittances received in
India.
• India received about USD 87 bn in remittances in FY21 (world’s highest).
• Decline in remittances from GCC (Gulf): Share of remittances from GCC region in India’s inward remittances
is estimated to have declined from more than 50% in 2016-17 (last surveyed period) to about 30% in 2020-
21.
• Remittances have exceeded foreign direct inflows in several countries, including India.
• Among States: Share of traditional remittance recipient States of Kerala, TN, Karnataka has almost halved
in 2020-21. MH has emerged as top recipient State surpassing Kerala.
→ External Debt Management Unit (EDMU) in Department of economic Affairs, Ministry of Finance releases 28 th edition
of Status Report on India’s External Debt 2021-22. It says India’s external debt is at USD 620.7 billion as at end-March
2022, grew by 8.2% over USD 573.7 billon as at end-March 2021. While 53.2% of it was denominated in US dollar,
Indian rupee denominated debt is estimated at 31.2%.
About:
 What:
→ In international economics, balance of payments of country is difference between all money flowing into that country
in particular period of time (e.g., quarter or year) and outflow of money to rest of world. These financial transactions
are made by individuals, firms, government bodies to compare receipts and payments arising out of trade of goods
and services.
→ Balance of Payments (BOP) is the place where countries record their monetary transactions with the rest of the
world.
 Component - BOP consists of 2 components:
→ Current Account:
 What:
• Current account reflects country's net income.
• In economics, country's current account records value of exports and imports of both goods and services
and international transfers of capital. Current account measures nation's earnings and spendings abroad.
• It is called current account because goods and services are generally consumed in current period.
• It is net trade in goods and services, net earnings on investments, and net transfer payments over period of
time – say, year or quarter.
 Component:
• Current account consists of:
 balance of trade;

Page 334 of 719

  net primary income or factor income (earnings on foreign investments minus payments made to foreign
investors);
 net unilateral transfers.
• Current account includes net income (interest, dividends, etc), and transfers (foreign aid, etc), although
these components make up only small % of total current account. Current account represents country’s
foreign transactions and, like capital account, is one component of that country’s balance of payments
(BOP). That is, Current Account includes nation’s net trade-in products and services, its net earnings on
cross-border investments including interest and dividends, and its net transfer payments such as
remittances and foreign aid.
 Parts:
• Current account essentially refers to 2 specific sub-parts:
 Import and Export of goods: This is called “trade account”. If country imports more goods (cars, phones,
etc.) than it exports, it is said to have Trade Account Deficit
 Import and export of services: This is called “invisibles account”.
When net effect of trade account and invisibles account is deficit, it is called CAD.
 Significance:
• Current account balance is one of 2 major measures of country's foreign trade (other being Net Capital
Outflow).
• Current Account Surplus indicates that value of country's net foreign assets (i.e. assets less liabilities) grew
over period in question. CA Surplus implies higher inflow of forex than outflow, and increase in Forex -
critical for maintaining financial stability and external sector stability. Usually, CA surplus is good but CA
surplus coming from less imports coupled with low domestic demand (example FY21 CA surplus) i.e. low
domestic consumption, is not good for economy. CAD indicates that it shrank. Both government and private
payments are included in this calculation.
• Current Account is important information about economic condition of country. How: Higher
balance of CA usually means export values > import values, that indicates healthy inflow of FOREX
reserves.
• CAD depicts that money going out of country for imports, investments, and services is greater than
money coming into that country through exports, investments and services provided by that
country. It is measured as % of GDP.
 Current Account Balance (CAB):
• It is part of a country's financial inflow and outflow record. It is part of the balance of payments,
the statement of all transactions made between one country and another.
• Formula:
 CAB = (X−M) + (NY + NCT); where: X=Exports of goods and services, M=Imports of goods and services,
NY=Net income abroad, NCT=Net current transfers.
 Current Account Deficit (CAD):
• What:
 CAD is one measurement of any country’s trade where value of goods and services it imports exceeds
value of products it exports. CAD is shortfall between money received by selling products to other
countries and money spent to buy goods and services from other countries. If value of goods and
services that country imports exceed value of those that country export, that country is said to be in
deficit, and difference in two values is CAD. [Current account includes net income (including interest,
dividends), and transfers, like foreign aid.
 CAD means value of goods and services imported exceeds value of exports.
• Cause:
 Structural: Under-investment, relatively low production, relatively high inflation, ….
 Cyclical: Over-valued exchange rate, boom in domestic demand, recession in export market, Slump in
global prices of exports, increased demand for imported items.
• Impact on economy:
 Large CAD will result in increase in demand for foreign currency, thus leading to depreciation of home
currency. Weaker Indian currency will drive inflation up.
• Is CAD always bad?
 While existing CAD can imply that country is spending beyond its means, having CAD is not inherently
disadvantageous. CAD is not always detrimental to nation's economy because external debt may be
used to finance lucrative investments. That is, if country uses external debt to finance investments that
have higher returns than interest rate on debt, that country can remain solvent while running CAD.
[Though, if country is unlikely to cover current debt levels with future revenue streams, however, it
may become insolvent].
 If increase in import bill is because of imports for technological upgradation it would help in long-term
development. If increasing imports is accompanied by expansion in industrial production, it is sign of
economic development.
Page 335 of 719
 • Remedy:
 Nations balance CAD by attracting capital inflows and running surplus in capital accounts through
increased FDI.
 Country can reduce its existing debt by increasing value of its exports relative to value of imports. It can
place restrictions on imports, such as tariffs or quotas, or it can emphasize policies that promote export,
such as import substitution, industrialization, or policies that improve domestic companies' global
competitiveness. Country can also use monetary policy to improve domestic currency’s valuation
relative to other currencies through devaluation, which reduces that country’s export costs.
 Devaluing domestic currency. [It will help increase country’s export competitiveness].
 Increase in export subsidy. [though this may attract WTO penalty] [This will increase exports].
 Adopting suitable policies which attract greater FDI and more funds from FIIs.
• Note:
 Emerging economies often run CA surpluses, and developed countries tend to run CA deficits, poor
countries tend to run current account debt.
 CAD indicates that country is importing more than it is exporting.
 India’s CA and CAD:
• India’s major import items are crude oil, gold, electronic items. CA of India has largely been in deficit due to
higher value of imports (mainly oil) than exports i.e. CAD. Reason:
 Low domestic production: Domestic industry’s issues - land and labour laws, high cost of capital and
production, taxes.
 Foreign competition: Cheap imports from countries such as China.
• Impact of CAD on India:
 Increase in trade deficit – mainly due to high crude oil bills.
 Adverse impact on current account balances, and on domestic manufacturers.
 Widening CAD tends to weaken domestic currency because CAD implies more dollars (or
foreign currencies) are being demanded than rupees. [Note: There is one mor e reason why
rupee may weaken: If, in response to higher interest rates in western economies especially
US, FPI continue to pull out money from Indian markets, that too will hurt Indian rupee and
further increase CAD.]
 Note:
• Current account reflects nation's net income, while Capital account reflects net change in ownership of
national assets.
• While balance of trade measures only gap in earnings and expenditure on exports and imports of goods and
services, Current Account also factors in payments from domestic capital deployed overseas.
→ Capital Account (Financial Account):
 What:
• Capital account reflects net change in ownership of national assets.
• In macroeconomics and international finance, capital account records net flow of investment transaction
into economy.
 Feature:
• Surplus in capital account means money is flowing into country, but unlike surplus in current account,
inbound flows effectively represent borrowings or sales of assets rather than payment for work.
• Deficit in capital account means money is flowing out of country, and it suggests nation is increasing its
ownership of foreign assets.
 Significance:
• Term "capital account" is used with narrower meaning by IMF and affiliated sources. IMF splits what rest of
world calls capital account into 2 top-level divisions: financial account and capital account, with by far bulk
of transactions being recorded in its financial account.
 Note: Current account reflects nation's net income, while Capital account reflects net change in ownership of
national assets.
 In brief, Balance of Payment has 2 components:
→ Current A/c:
 Trade in goods: That is, export and import of goods.
 Trade in services (Trade in Invisibles): Net factor income (Example, Investment income); Non -factor
income (example, Insurance, IT services income)
 Transfer payments: Gifts, remittances, grants.
→ Capital A/c;
 Investments: Example – FDI, FPI
 External Borrowings: ECB, short term debts.
 External Assistance: Government borrowings, Bilateral loan, IMF’s SDR.
Note:

Page 336 of 719

 Net Capital Outflow (NCO):
→ What:
 Net flow of funds being invested abroad by country during certain period of time (usually year). +ve
NCO means that country invests outside more than world invests in it.
 NCO is one of 2 major ways of characterizing nature of country's financial and econo mic interaction
with other parts of world (other being balance of trade).
 Balance of trade / Commercial balance / Net exports (NX):
→ What:
 Difference between monetary value of nation's exports and imports over certain time period.
Sometimes distinction is made between balance of trade for goods versus one for services. Balance of
trade measures flow of exports and imports over given period of time. [Notion of balance of trade
does not mean that exports and imports are "in balance" with each other].
→ Feature:
 If country exports greater value than it imports, it has trade surplus or +ve trade balance, and
conversely, if country imports greater value than it exports, it has trade deficit or -ve trade balance.
 Notion that bilateral trade deficits are bad in and of themselves is overwhelmingly rejected by trade
experts and economists.
 Current Account vs Taper Tantrum:
→ What:
 Taper tantrum describes 2013 increase in U.S. Treasury yields, because of US Federal Reserve's
announcement of future tapering (reduction) of its quantitative easing (buying of government
securities to inject money into economy) policy.
→ Event:
 US Federal Reserve announced that it would be reducing purchases of treasury bonds, to reduce
feeding of money into economy. investors pani c as they thought that market would crumble. Because
of which there was rise in bond yields and then inflation. This 2013 collective reactionary panic is
referred to as Taper tantrum.
 Twin deficits hypothesis / Twin deficits phenomenon:
→ What:
 In macroeconomics, twin deficits hypothesis or twin deficits phenomenon, is observation that,
theoretically, there is strong causal link between country's government budget balance and its current
account balance.
→ How:
 Standard macroeconomic theory points to how budget deficit can be one contributing factor to CAD .
This link can be seen from considering national accounting model of economy:
[Y = C + I + G + (X-M)],
where Y represents national income or GDP; C is consumption; I is investment; G is government
spending; X–M is net exports (NX). This represents GDP because all production in economy (left hand
side of equation i.e. Y) is used as consumption (C), investment (I), government spending (G), and goods
that are exported in excess of imports (NX).
Now, another equation defining GDP using alternative terms (which in theory results in same
value) is:
[Y = C + S + T],
where Y is again GDP; C is consumption; S is private saving; T is taxes. This is because national income
is also equal to output, and all individual income either goes to pay for consumption (C), to pay taxes
(T), or is saved (S).
Here, we have Y = C + I + G + NX and Y = C + S + T.
=> C + I + G + NX = C + S + T;
=> I + G + NX = S + T;
=> I + G + NX = S + T;
=> NX = (S – I) + (T – G).
Here, if (T-G) is -ve, we have budget deficit. Now, let us assume one economy already at
potential output, meaning Y is fixed. In this case, if budget deficit (T – G) increases, and saving (S)
remains same, then this last equation implies that either investment (I) must fall, or net exports (NX)
must fall, causing trade deficit. Hence, it means budget deficit can also lead to trade deficit, causing
twin deficit.
 Note: Though economics guiding which of two – Investment (I) or Net Exports (NX) is used to finance
government deficit can get more complicated than what is shown above, essence of it is that if
foreigners' savings (Investment, I) pay for budget deficit, CAD grows. If cou ntry's own citizens' savings
(S) finance borrowing, it may cause crowding out effect (in that economy which is at or near potential
output, or full employment).
→ India:
Page 337 of 719
  Background: In 2022, with global geopolitical crisis and weakened Indian currency, twin deficit is expected to
affect Indian economy adversely. According to Union Budget [2022-23], FD and CAD for Financial Year 2022-23
were at 6.4% of GDP and 1.2% of GDP respectively. In its one ‘Monthly Economic Review’ in 2022, Ministry of
Finance reported that world is looking at distinct possibility of widespread stagflation. India, however, is at low
risk of stagflation, owing to its prudent stabilization policies, pointing towards stable economic condition of
India. However, this report points towards ‘twin deficit’ problem i.e., increased FD and CAD. Reason: 2022
Russian invasion of Ukraine hampering global supply chain leading to trade disruptions, export bans and surge
in commodity prices, have adversely effected overall economic growth – increased crude oil prices, inflation
rates beyond states capacity and recession picking up around world. These two deficits are posing problem for
India at such juncture.
 Cause:
• Finance Ministry’s Monthly Economic Review notes that excise duties on petrol and diesel have been
decreased, which is major contributor of Central and States revenues. Reduction in excise duties thus
adversely affects revenues. Increased fertilizer and food subsidies provided by government has added
additional expenditure, widening fiscal deficit gap.
• Increased crude oil prices along with edible oil and other commodities leads to costlier imports in dollar
bills. This in turn increases CAD and weakens value of Indian rupee and further aggravating external
imbalances.
 How twin deficit will affect Indian Economy?
• Higher FD leads to reduction in resources available for investment and stresses repo rates. Increase in
interest rates affect private investment and expenditure of India, and thus less internal sales. This will
hamper Indian economy.
• Increased CAD leads to weakening of rupee currency which further affects import bill. Costly import will
then lead to higher payments in dollars and decrease in reserves.
• Although no cause of worry in short term, twin deficit may in long-term reduce savings, depreciate Indian
rupee and imbalance financial investments of government for social purposes.
 Steps to tackle twin deficit:
• Government needs to cut revenue expenditure in order to mitigate high FD, as capital expenditure should
not be cut during growth period. Further, Monthly Economic Review also suggested that rationalizing non-
capex (non-capital expenditure) is critical not only for protection of growth supportive capex but for
avoiding fiscal slippages too.
• Government must formulate revised strategies to boost exports - ease down export procedures and release
their tax dues in time to lower import bill to control CAD.
• Trim revenue expenditure (or money government spends just to meet its daily needs).
• Rationalizing non-Capex (capital) expenditure to avoid fiscal slippages.
• Use tight monetary policy to achieve fiscal consolidation.
• Import cut of non-essential goods and make exports of Indian goods competitive.
• Reform Indian market to make it attractive for FDI, FIIs.
 Challenge:
• Maintaining growth momentum, restraining inflation, keeping FD within budget and containing CAD while
maintaining fair value of Indian currency.
 Capex / Capital expenditure:
→ It essentially refers to money spent towards creating productive assets such as roads, buildings, ports etc. Capex has
much bigger multiplier effect on overall GDP growth than revenue expenditure.
 External debt:
→ What:
 Country's gross external debt (or foreign debt) is liabilities that are owed to nonresidents by residents. Debtors
can be governments, corporations or citizens. It is liabilities that are borrowed from outside country and have
to be paid back in same currency.
External debt is portion of country's debt that is borrowed from foreign lenders, including commercial
banks, governments, or international financial institutions. These loans, including interest, must usually be paid
in currency in which loan was made. To earn needed currency, borrowing country may sell and export goods to
lending country.
→ Types:
 Public and publicly guaranteed debt. Non-guaranteed private sector external debt. Central bank deposits. Loans
from IMF. External Commercial Borrowing. Currency Convertible Bonds. Government Borrowings (sovereign
debt). NRI deposits.
→ Feature:
 External debt may be denominated in domestic or foreign currency. It includes amounts owed to private
commercial banks, foreign governments, or international financial institutions such as IMF, WB.
→ Significance:

Page 338 of 719

  External debt measures economy's obligations to make future payments and, therefore, is one indicator of
country's vulnerability to solvency and liquidity problems.
→ India’s External Debt
 Most of India’s external debt is linked to US dollar. According to Status Report on India’s External Debt 2021-22,
released by External Debt Management Unit (EDMU) in Department of economic Affairs, Ministry of Finance,
India’s external debt was at USD 620.7 billion as at end-March 2022, grew by 8.2% over USD 573.7 billon as at
end-March 2021. While 53.2% of it was denominated in US dollar, Indian rupee denominated debt was
estimated at 31.2%.
Question:
 Balance of payments of one country is systematic record of - All import and export transactions of that country during
given period of time, normally 1 year. In international economics, balance of payments of one country is difference
between all money flowing into that country in particular period of time and outflow of money to rest of world.
 With reference to Balance of Payments, which of following constitutes / constitute Current Account?
→ (1) Balance of trade
→ (2) Foreign assets
→ (3) Balance of invisibles
→ (4) Special Drawing Rights
Ans: (1) and (3)
Mains Link:
 What do you understand Current Account Deficit? Do you think a rising CAD is inherently bad and must be checked by
the country’s central bank? Discuss (10M)
 Examining the current account balance of a country’s BOP can provide a good idea of its economic activity. Discuss.

GRAVITATIONAL LENS
News:
 2022:
→ Gravitational lensing in news.
→ James Webb Space Telescope captures image of almost perfect “Einstein ring”. Image was captured using
JWST’s MIRI (Mid-Infrared Instrument).
About:
 What:
→ Gravitational lens is distribution of matter (such as cluster of galaxies) between distant light sourc e and
observer that is capable of bending light from source as light travels toward observer. This effect is known
as gravitational lensing, and amount of bending is one of predictions of Albert Einstein's General Theory
of Relativity. Newtonian physics also predicts bending of light, but only 1/2 of that predicted by general
relativity.
 Gravitational lensing:
→ What:
 Effect in which distribution of matter like cluster of galaxies (gravitational lens) between distant light source and
observer bends light from that source as light travels towards observer. This is one of predictions of Albert
Einstein's general theory of relativity. Effect in which massive objects (like stars) bend light, due to gravity
(bending of space-time). As light emitted by distant galaxies passes by massive objects in universe, gravitational
pull from these objects can distort or bend light.
→ Feature:
 More massive object, stronger its gravitational field and hence greater bending of light rays.
→ Significance:
 Eistein predicted that Stars would appear away from their normal position on Total solar eclipse due to this
bending of light (from stars) by Sun due to warping of space-time fabric. It was proven by taking photos of 1919
Total solar eclipse, which consequently proved General Relativity Theory of Einstein, making him famous world
wide.
 Gravitational lensing is useful to cosmologists because it is directly sensitive to amount and distribution of dark
matter. Lensing can help astronomers work out exactly how much dark matter there is in Universe as whole and
also how it is distributed. Lensing has also been used to help verify existence of dark matter itself.
→ Note:
 Black hole can also act as gravitational lens.
 Gravitational microlensing:
→ observational effect predicted in 1936 by Einstein using his General Theory of Relativity.
→ When one star in sky appears to pass nearly in front of another, light rays of background source star
become bent due to gravitational "attraction" of foreground star. This star is then virtual magnifying glass,
amplifying brightness of background source star, so we refer to foreground star as lens star. If lens star
harbors planetary system, then those planets can also act as lenses, each one producing short deviation in
brightness of source star.
Page 339 of 719
 → Thus we discover presence of each exoplanet, and measure its mass and separation from its star. This
technique will tell us how common Earth- like planets are, and will guide design of future exoplanet
imaging missions.
Note:
 Black hole, gravitational wave, dark matter, gravitational microlensing:
→ When gravitational wave approaching earth is interrupted by presence of black hole (acting as gravitational
lens), said gravitational wave signal get modified. This effect will change shape of gravitati onal wave signals
that are received on earth. Scientists can then use received gravitational wave signals to confirm presence
of black hole.
 Einstein ring / Einstein–Chwolson ring / Chwolson ring:
→ It is created when light from galaxy or star passes by mass ive object en route to Earth. Due to gravitational
lensing, light is diverted, making it seem to come from different places. If source, lens, and observer are
all in perfect alignment, light appears as ring. Einstein ring is ring of light created when light from galaxy,
star or other light-emitting cosmic objects passes near massive object before it reaches Earth (observer
like JWST).
Mains Link:
 Discuss the significance of Gravitational Lensing.

TRADE / IMPORT EXPORT

News:
 2021:
→ Global trade is recovering [good news for Indian exporters]
→ India’s merchandise exports grow [higher than pre-COVID pandemic level]. But, growth in export in labour -
intensive sector – textiles, apparel sector – is low. Merchandise imports grow especially - Gold
imports.Trade deficit widened because imports > export.
→ Government approves continuation of National Export Insurance Account (NEIA) scheme.
 2022:
→ EXIM Bank extends line of credit (LOC) to Sri Lanka for financing purchase of petroleum products.
→ Export Credit Guarantee Corporation of India (ECGC Ltd.)puts Russia in Restricted Cover Category (RCC -I)
from earlier ‘open cover’ category. [Open cover category enables policyholders to obtain cover on more
liberalised basis].
→ India’s exports cross USD 400 bn annual target: India’s annual goods exports crossed USD 400 billion mark for 1 st
time ever, buoyed by increase in shipments of merchandise including engineering products, apparel, garments, gems
and jewellery, petroleum products. Key drivers:
 Massive rise in oil prices, increase in global prices of industrial commodities, resurgent agri -sector
(rice etc), higher share of manufactured goods
 Expansionary monetary policy by developed economies in response to economic impact of Covid -19
pandemic boosted demand for Indian exports.
→ NITI Aayog, in collaboration with Institute of Competitiveness (Haryana based)releases Export
Preparedness Index (EPI) 2021.
→ In bid to cool inflation in edible oils, Centre allows duty free import of 20 lakh tonnes each of crude soybean oil and
crude sunflower oil for 2022-23, 2023-24.
→ US surpasses China to become India’s top trading partner in 2021-22.
 Fact: In 2021-22, bilateral trade between US and India stood at USD 119.42 billion as against USD 80.51 billion
in 2020-21. [US is one of few countries with which India has trade surplus]. In 2021-22, UAE was 3rd largest
trading partner of India, followed by Saudi Arabia, Iraq, Singapore.
→ Dutch Disease was in news.
→ PM inaugurates Vanijya Bhawan (one new office of Department of Commerce) in New Delhi and launches National
Import-Export Record for Yearly Analysis of Trade (NIRYAT) portal.
→ RBI announces arrangement for domestic traders to settle imports and exports in rupees (rupee switch), move
experts said is aimed at facilitating trade with sanctions-hit Russia. According to RBI, this would promote global trade
growth with emphasis on exports from India and will support increasing interest of global trading community in
domestic currency. [This comes amid rupee touching record lows against dollar. India’s trade with Russia stood at
USD 13.1 billion in 2021-22].
→ Finance Ministry to meet with stakeholders including banks and Ministries of External Affairs and Commerce to
discuss ways to promote international trade in rupee instead of US dollar. This meeting will be attended by
representatives of RBI, IBA, representative body of banks, and industry bodies. Banks would be told to ask exporters
to negotiate on rupee trade.
 Background: Earlier in 2022, RBI issued circular saying it had decided to put in place additional arrangement for
invoicing, payment, and settlement of exports / imports in INR. RBI said idea was to promote growth of global
trade with emphasis on exports from India and to support increasing interest of global trading community in
INR.
Page 340 of 719
  Impact: While move to allow trade settlements between India and other countries in INR is seen to primarily
benefit trading with Russia, it is also expected to help check dollar outflow and slow depreciation of INR.
→ WTO warns darkened trade outlook could deteriorate further: WTO cuts 2023 global trade growth forecast to 1.0%
from 3.4%. WTO also says trade could contract if Ukraine war worsens. WTO forecast slowdown of global trade
growth in 2023 because higher energy price, higher food price and rising interest rates curb import demand, and
warned of possible contraction if war in Ukraine worsens. WTO also says merchandise trade would increase by 3.5%
in 2022, however, for 2023, WTO sees trade growth of just 1.0%.
 Reason:
• War in Ukraine and subsequent supply chain disruption. Weather events hitting food-producing regions or
damaging energy export infrastructure. Weakness in China, where COVID-19 outbreaks have disrupted
production. Curbs imposed by various countries on food and fertiliser exports. Lower demand.
 Impact:
• These would only deepen inflationary pressures and reduce living standards and would likely make us more
vulnerable to crisis we are grappling with.
 Recommendation:
• World needs more diversified and less concentrated base for production of goods and services, which
should boost growth, increase resilience and promote long-term price stability by mitigating exposure to
extreme weather events and local disruptions.
About:
 Foreign Trade Policy (FTP), 2015-20:
→ What:
 Increase of India’s exports of goods and services
 Generation of employment
 Increase of value addition
 in line with ‘Make in India’ programme.
 FTP 2015-20 introduces new schemes:
• Remission of Duties and Taxes on Export Products (RoDTEP) [former Merchandise Exports from India
Scheme (MEIS)]
• Services Exports from India Scheme (SEIS).
 Duty credit scrips (certificate)
 Specific Export Obligation under Export Promotion Capital Goods (EPCG) scheme.
 Import Duty:
→ What:
 Tax collected on imports and some exports by country's customs authorities. Value of imported goods
usually dictates import duty. Depending on context, import duty may also be known as customs duty,
tariff, import tax, import tariff.
→ Purpose:
 Import duties have 2 distinct purposes: raise income for local government; and give market advantage
to locally grown or produced goods that are not subject to import duties. 3rd related goal is sometimes
to penalize particular nation by charging high import duties on its products.
→ Feature:
 Import duty is levied when imported goods 1 st enter country.
 Around world, several organizations and treaties have direct impact on import duties.
 It is based on value of goods that are imported.
 India’s export:
→ From 1991 to 2018, India’s share in world exports has increased. [Though small in comparison with China].
→ Factors delaying growth of India’s exports:
 High Costs:
• Logistics: 13-14 % of GDP
• Export finance (export credit): EXIM Bank offers less short-term export finance / credit. Low share of private
banks in export credit.
• High interest: 6-7 % interest.
 Regulatory Hurdles:
• Inflexible labour laws
• States’ high power tariffs, other taxes and cess
• Extra costs of coal cess, royalty charges in metal sector.
• Cross-subsidisation Industrial tariff much higher than consumer tariff
 Lopsided FTA / Trade Deficit:
• Trade deficit with ASEAN, South Korea, Japan
 Inverted duty structure:
• No clarity on import of intermediates
Page 341 of 719
 • Low duty on chemicals, rubber etc. discourages ‘Make in India’.
• Higher duty on raw materials but lower tariff on finished product.
→ Concern for Indian export:
 Total imports > Total exports
 LessIndia’s share in international trade
 increasing freight rates
 large container shortages
 releasingbenefits under various export schemes.
→ Govt. Initiatives:
 Foreign Trade Policy (2015-20) extended upto 2021 due to COVID-19 pandemic.
 All script base schemes that provided liquidity in COVID-19 times in 2021.
 Remission of Duties and Taxes on Export Products (RoDTEP) [2020]:
• What:
 refund outstanding central, State and local duties or taxes to exporters [reimbursement of taxes
/ duties / levies, currently not being refunded under any other mechanism, at central, State, local levels]
 replacement for Merchandise Export from India Scheme (MEIS), which was not compliant with
WTO’s rules.
 WTO compatible mechanism
 Refund of duties and taxes on export products.
• Need:
 Non-refund of dues to exporters make India’s exports at disadvantage, in comparision with
that of international.
• Significance:
 Domestic testing and certification: Indian exporters will be able to meet international standards for
exports because affordable testing and certification will be made available to exporters within India
instead of relying on international organizations.
 Automatic tax assessment: Tax assessment will be made fully automatic for exporters. GST
refunds via automatic refund-route.
 Thus, it would increase economy for India and working capital for enterprises.
 SEZ Act, 2005 amended to enable wider coverage
 National Export Insurance Account (NEIA) scheme:
• National Export Insurance Account (NEIA):
 What:
o trust set set up by Government of India
 Objective / Goal:
o to facilitate medium and long-term exports, which are commercially viable, considering limitations
of ECGC Limited in providing adequate cover to exporters.
 Aim (Direction):
o to ensure availability of credit risk cover for projects, other high-value exports, which are desirable
from point of view of national interest, but which ECGC is unable to underwrite at terms which will
not affect competitiveness of exports.
• NEIA Trust [2006]:
 Trust by name of National Export Insurance Account Trust.
 set up for maintaining and operating NEIA.
 NEIA Trust primarily deals with funds made available for NEIA and investments keeping in view funds
requirement for meeting immediate obligations.
 NEIA Trust promotes Medium and Long Term (MLT) project exports by extending risk covers.
 NEIA Trust also provides covers to Buyer’s Credit, give by EXIM Bank, to project exports from India.
 ECGC has significant role to play in administration of NEIA Trust.
• Significance:
 Capital infusion in NEIA will generate output from vast potential of project exports in markets.
 Capital infusion to NEIA will boost exports sector.
 Support to project exports will enhance manufacturing in India.
• Performance:
 Its impact in enabling project exports has been significant in Africa, South Asia.
 Rebate of State & Central Taxes and Levies (ROSCTL) scheme:
• Support to textiles sector by remission of Central/ State taxes
• This scheme is upto 2024.
 Trade Infrastructure for Export Scheme (TIES):
• to promote trade infrastructure
 Market Access Initiatives (MAI) Scheme:

Page 342 of 719

 • to promote marketing
 Transport and Marketing Assistance (TMA):
• to promote trade infrastructure and marketing.
 NIRVIK scheme:
• to give enhanced insurance cover, lower premium.
→ Potential export driver:
 Rice; Oilcake; residue from soybean oil; Insecticides and similar products; woven fabrics of cotton;
Semifinished products of iron, non-alloy steel; Structures and parts - bridges etc; Spark-ignition or
internal combustion engines; Motorcycles, cycles.
→ Way forward for Indian export:
 Resolve increasing freight rates
 Resolve large container shortages
 Release benefitsunder various export schemes, to targets.
 International trade [currency point of view]:
→ Current system:
 Currently, exports or imports by Indian company are always in foreign currency, with exceptions such
as Nepal, Bhutan. So, in case of imports, Indian company has to pay in foreign currency, which is mainly
dollars, but could also be pounds, euros, yen, etc. Indian company gets paid in foreign currency in case
of exports and it converts that foreign currency to rupee since it needs rupee for its requirements to
use in most of cases inside India.
→ International trade in rupee:
 Story / Initiative:
• In recent years, GOI has been pushing for international trade in rupee.
• In early 2022, RBI issued circular saying it had decided to put in place additional arrangement for invoicing,
payment, and settlement of exports / imports in INR. RBI said idea was to promote growth of global trade
with emphasis on exports from India and to support increasing interest of global trading community in INR.
• Later in 2022 itself, Finance Ministry was set to meet with stakeholders including banks and Ministries of
External Affairs and Commerce to discuss ways to promote international trade in rupee instead of US dollar.
This meeting was to be attended by representatives of RBI, IBA, representative body of banks, and industry
bodies. Banks would be then told to ask exporters to negotiate on rupee trade.
 How:
• To settle trade transactions with any country, banks in India can open Vostro accounts in other countries
banks and vice versa. [Vostro account is account that one bank holds on behalf of another bank].
 Impact:
• While move to allow trade settlements between India and other countries in INR is seen to primarily benefit
trading with Russia, it is also expected to help check dollar outflow and slow depreciation of INR.
• While RBI order did not say so, this arrangement is expected to be used primarily for Russia. In 2022, there
are sanctions on Russia due to 2022 Ukraine war and Russia is off SWIFT system (system used by banks for
payments in foreign currency). This means payments do not have to be made in foreign currency and this
arrangement would help both Russia and India.
 Benefit:
• Enable trading with Russia. Check dollar outflow. Slow depreciation of rupee. Promote growth of global
trade with emphasis on exports from India and to support increasing interest of global trading community
in INR.
 Issue:
• Arrangement of international trade in INR is unlikely to be extended to other countries (apart from Russia).
India may want to, but other countries may not accept it as they may need foreign currency to pay for their
own imports. Example, Sri Lanka may also want us to pay in dollars or any other foreign currency. [Credibility
of rupee is lower than US dollars.]
• There is also argument that this arrangement of international trade in INR is not expected to help arrest fall
of rupee.
Note:
 Export Credit Guarantee Corporation of India (ECGC Ltd.) [1957]:
→ export credit provider
→ government owned.
→ wholly owned by Ministry of Commerce and Industry, Government of India
→ based in Mumbai, Maharashtra.
→ It provides export credit insurance support to Indian exporters.
→ established to promote exports by providing credit insurance services to exporters against non-payment
risks by overseas buyers due to commercial and political reasons.
 EXIM Bank [1982]:
Page 343 of 719
 → established under Export-Import Bank of India Act, 1981.
→ wholly owned Govt. of India entity.
→ It extends Line of Credits (LOC) to overseas financial institutions, regional development banks, sovereign
governments, overseas entities, to enable buyers in those countries to import developmental and
infrastructure projects, equipment, goods and services from India.
 Export Preparedness Index (EPI) [2020]:
→ What:
 comprehensive analysis of India’s export achievements.
 It aims to identify fundamental areas critical for subnational export promotion.
 released by NITI Aayog, in collaboration with Institute of Competitiveness (Haryana based)
→ Ranking of States:
 It ranks States on 4 key parameters: Policy, business ecosystem, export ecosystem, export performance.
 It also takes into consideration 11 sub-pillars: export promotion policy; institutional framework; business
environment; infrastructure; transport connectivity; access to finance; export infrastructure; trade support; R&D
infrastructure; export diversification; growth orientation.
→ 2021 Export Preparedness Index (EPI):
 Coastal States as best performers in this index.
 Gujarat – tops for 2ndconsecutive time, Maharashtra – 2nd, Karnataka – 3rd.
 Dutch Disease:
→ What:
 In economics, Dutch disease is apparent causal relationship between increase in economic development of
specific sector (for example natural resources) and decline in other sectors (like manufacturing sector or
agriculture).
 This term was coined in 1977 to describe decline of manufacturing sector in Netherlands after discovery of large
Groningen natural gas field in 1959.
 It also refers to phenomenon wherein country witness uneven growth across sectors due to discovery of natural
resources, especially large oil reserves. Netherlands (1960s) discovered gas reserves in North Sea. Subsequent
export of oil and appreciation of Dutch currency made Dutch exports of all non-oil products less competitive on
world market. Unemployment rose from 1.1% to 5.1% and capital investment in Netherlands dropped. Following
this, over years, Netherlands witnessed downfall in industrial sector.
→ Mechanism:
 Presumed mechanism is that as revenues increase in growing sector (or inflows of foreign aid), given nation's
currency becomes stronger (appreciates) compared to currencies of other nations (manifest in exchange rate).
This results in that nation's other exports becoming more expensive for other countries to buy, and imports
becoming cheaper, making those sectors less competitive.
 Also, when country discovers natural resources and starts exporting them to rest of world, it causes exchange
rate of that country’s currency to appreciate significantly and this, in turn, discourages exports from other
sectors while encouraging import of cheaper alternatives.
 While it most often refers to natural resource discovery, it can also refer to any development that results in large
inflow of foreign currency, including sharp surge in natural resource prices, foreign assistance, FDI.
 National Import-Export Record for Yearly Analysis of Trade (NIRYAT) portal [2022]:
→ This portal will provide public database on exports from States and will help break down silos and help
industry to take fast decisions.
→ It will also ultimately connect government’s work on one district one export plan.
→ From this portal, important information related to more than 30 commodit y groups exported to more than
200 countries of world will be available.
 Rupee switch trade settlement (RBI):
→ Background:
 In 2022, RBI announced arrangement for domestic traders to settle imports and exports in rupees (rupee switch),
move experts said was aimed at facilitating trade with sanctions-hit Russia. According to RBI, this would promote
global trade growth with emphasis on exports from India and will support increasing interest of global trading
community in domestic currency. [This came amid rupee touching record lows against dollar. India’s trade with
Russia stood at USD 13.1 billion in 2021-22].
→ Benefits:
 Will boost Indian export and currency: This move would promote global trade growth with emphasis on exports
from India (e.g. Tea export) and will support increasing interest of global trading community in domestic
currency.
 Expedite transactions with sanctions-hit Russia: India’s trade with Russia stood at USD 13.1 billion in 2021-22.
 Final settlement in Indian Rupee: Under existing provisions of FEMA, final settlements must be in free foreign
exchange except for Nepal and Bhutan. Now, under this RBI’s final settlement system, settlements to all
countries can be in Indian rupee.

Page 344 of 719

  Save foreign currency and reduce trade deficit: Since India imports more than it exports. It will enhance forex
inflows and as step to stabilize rupee.
 Will help build better ties with Russia: Opening of trade settlement route shows Russia’s importance as India’s
trading partner in face of increasing pressure from Western countries to cut links.
 Can be used for other neighbouring countries as well: Several countries including Iran, Sri Lanka and some in
Africa and Latin America are facing forex shortages. As such, this new mechanism will help India promote its
exports in these countries.
→ Working mechanism:
 Russian banks will have to open Vostro accounts in India, and whenever exports or imports take place, that
account will be debited or credited. Indian importers will make payments in rupees, to be credited to Vostro
account of correspondent bank of partner country. Indian exporters will be paid export proceeds in rupees.
 International Current Account:
→ Intro:
 "Nostro" and "vostro" are two different terms used to describe same bank account. These terms are used when
one bank has another bank's money on deposit, typically in relation to international trading or other financial
transactions. Both banks in venture must record amount of money being stored by one bank on behalf of other
bank. Terms nostro and vostro are used to differentiate between two sets of accounting records kept by each
bank. Nostro and vostro are variations on Latin words that mean "ours" and "yours," respectively. Modern retail
banking is derived from 13th and 14th century Italy, where both depositors and retail banks-maintained ledgers
of their account balances. Ledger kept by depositing customer called it nostro ledger; bank kept corresponding
vostro ledger.
 Nostro and vostro (from Italian; English, 'ours' and 'yours') are accounting terms used to distinguish one account
held for another entity from one account another entity holds. Entities in question are usually banks. Terms
nostro and vostro are used, mainly by banks, when one bank keeps money at another bank (in one
correspondent account often called nostro or vostro account). Both banks need to keep records of how much
money is being kept by one bank on behalf of other. In order to distinguish between two sets of records of same
balance and set of transactions, banks refer to accounts as nostro and vostro.
Speaking from point of view of bank whose money is being held at another bank: Nostro is our account
of our money, held by other bank; and Vostro is our account of other bank money, held by us.
Vostro account is record of money held by bank or owed to bank by 3 rd party (individual, company, or
bank). Nostro account is way of keeping track of how much of bank’s money is being held by other bank. This is
similar to individual keeping detailed record of every payment in and out of his or her bank account so that she
/ he knows balance at any point in time.
→ Type:
 Nostro Account:
• It is like “Our money with you”. Example, Indian banks’ accounts in Russia.
• Nostro account is reference used by Bank A to refer to "our" account held by Bank B. Nostro is shorthand
way of talking about "our money that is on deposit at your bank." Nostro account is record of bank that has
money on deposit at another bank. These accounts are often used to simplify settlements of trade and
foreign exchange transactions. Nostro accounts differ from standard demand deposit bank accounts in that
they are usually held by financial institutions, and they are denominated in foreign currencies.
 Vostro Account:
• It is like “Your money with us”. Example, Russian banks’ accounts in India.
• Vostro is term used by Bank B, where bank A's money is on deposit. Vostro is reference to "yours" and refers
to "your money that is on deposit at our bank." Vostro account is like any other account held by bank. Vostro
account is record of money owed to or maintained by 3 rd party, typically another bank, but it can be either
company or individual.
Banks in UK or USA often hold vostro account on behalf of foreign banks. Vostro account is held in
currency of country where money is on deposit.
 Loro Account:
• It is like their money.
Question:
 Problem of international liquidity is related to non-availability of - dollars and other hard currencies, because most
international transactions occur in Dollar or other hard currencies.
Mains link
 Why has India not been able to increase its share in global export market?
 Discuss the significance of the National Export Insurance Account (NEIA) Trust.
 Discuss the significance of the Export Preparedness Index (EPI).

INTERNET
(GS2, GS3)
News:
Page 345 of 719
  2019:
→ Communication shutdowns in Delhi, Assam during protests against Citizenship Amendment Act, 2019
 2020:
→ Communication shutdowns in Delhi, Assam during protests against Citizenship Amendment Act, 2019
→ Internet curbs in JK.
 2021:
→ Communication shutdowns in Delhi during farmer’s protest.
→ Centre in face-off over its new IT rules 2021 with tech giants – Twitter, facebook etc.
→ Twitter describes police search at its offices in India as potential threat tofreedom of expression.
→ As one guest country, India signs G7 and guest countries’s statement (Democracies 11) on open societies that
condemns politically motivated internet shutdowns. Politically motivated internet shutdowns are threats to
freedom and democracy.
 India’s reason on internet curbs: Open societies are particularly vulnerable to disinformation and cyber-attacks.
→ One UN-backed 2022 OHCHR report highlights that shutting down internet affects people’s safety & well-being and
human rights, hamper information flow and harm economy.
 2022:
→ Even before we could understand intricacies of Web 3.0, former Twitter CEO Jack Dorsey announces his
plans to build Web 5.0. Goal, according to him, is to create “extra decentralised” internet platform where
users have control over their data and identity.
→ Centre should be lone governing authority for issuing net shutdowns: In one letter to GOI, Internet and
Mobile Association of India (IAMAI) says current mechanism to issue internet shutdown orders causes
significant inconvenience to local public at large and says that Centre should be “governing authority” in
issuing internet shutdown orders and State governments should only issue such orders based on guidelines
laid out by Department of Telecommunications (DoT). [Telecom operators Bharti Airtel, Reliance Jio are
also members of IAMAI, which also counts Big Tech companies like Google, Meta, Apple as its members].
About:
 What:
→ Global system of interconnected computer networks that uses Interne t protocol suite (TCP/IP) to
communicate between networks and devices. It is network of networks that consists of private, public,
academic, business, and government networks of local to global scope, linked by broad array of electronic,
wireless, and optical networking technologies.
 Origin:
→ Origins of Internet date back to development of packet switching and research commissioned by US
Department of Defense in 1960s to enable time-sharing of computers. Primary precursor network,
ARPANET, initially served as backbone for interconnection of regional academic and military networks in
1970s. Funding of National Science Foundation Network in USA as new backbone in 1980s, as well as
private funding for other commercial extensions, led to worldwide participation in development of new
networking technologies, and merger of many networks. Linking of commercial networks and enterprises
by early 1990s marked beginning of transition to modern Internet, and generated sustained exponential
growth as generations of institutional, personal, and mobile computers were connected to network.
Although Internet was widely used by academia in 1980s, commercialization incorporated its services and
technologies into virtually every aspect of modern life.
 Feature:
→ Internet carries vast range of information resources and services, such as inter -linked hypertext documents
and applications of World Wide Web (WWW), electronic mail, telephony, file sharing.
 Evolution:
→ Web 1.0:
 What:
• Initial phase of Web (Web 1.0) was built around one -way communication, where users can only
read information on web pages and cannot interact.
 Feature:
• It is “read-only Web”.
• It was all about reading, and getting information.
• Static page – same content for all users.
• Content owned by creator of website.
• Websites were created only to display information.
→ Web 2.0:
 What:
• Web 2.0 is current web system that we are all using. It is dominated by social media platforms
where users can interact, comment, share, create content. But in current web system, users
generally have no control over data and it is stored with 3 rd parties. There are also genuine

Page 346 of 719

 concerns around how Big Tech companies such as Google, Facebook control most of data and
chances of potential misuse.
 Feature:
• It is “participative social Web”.
• It was all about reading, writing, and creating. So, users joined social platforms, and these
platforms got big because of this created content.
• Dynamic page – content customized as per user’s need.
• Interactive – helped people connect with each other.
• It included video streaming features.
→ Web 3.0 / Web3:
 What:
• Getting into more decentralised internet, Web 3.0 is being built on multiple blockchain networks
to reduce need for intermediaries or eliminate threats of censorships and outages. In essence, it
is designed to give control to users where data is stored in multiple blockchains and thus being
owned by users themselves.
It is 3 rd generation of evolution of web technologies. [web, also known as World Wide Web, is
foundational layer for how internet is used, providing website and application services]. Web 3.0
represents next iteration or phase of evolution of web / internet and potentially could be as
disruptive and represent as big paradigm shift as Web 2.0 did. Web 3.0 is built upon core concepts
of decentralization, openness, and greater user utility. It heavily relies on blockchain technology,
ML, and AI. It aims to create decentralized internet with open, connected, intelligent websites and
web applications.
 Feature:
• It is “read, write, execute Web.”. It is all about reading, writing and owning. So, builders and
creators can now own piece of their own community, through NFTs, tokens etc. No ownership of
content; anyone can contribute. Utilises machine learning & AI. Content can be accessed by
multiple applications.
 Benefits:
• Data ownership by user itself. In Web 2.0, tech giants control and exploit user -generated data.
• Fewer Intermediaries. Transparency. Efficient searching and information linking. Personalized
Web Surfing Experience. Uninterrupted services.
→ Web 5.0:
 What:
• Even though Web 3.0 and Web 5.0 more or less share same vision, technologies and protocols
employed to build these platforms are different. Former Twitter CEO Jack Dorsey says Web 3.0 is
mainly based on multiple blockchain networks or s ingle point of failure systems. He claims that
Web 3.0 is more centralised than what is portrayed in public discourse and is controlled by few
venture capitalists.
• Web 5 developers are saying that we don’t need blockchain for everything and that they can build
decentralised applications on well understood distributed centralised systems of computer
science. Web 5.0 will have series of decentralised apps and protocols. Instead of multiple
blockchains, Web 5.0 developers are trying to leverage only Bitcoin and build everything on top of
it. In Web 5.0, users will hold digital wallet that securely manages their identity, data, and
authorisations for external apps and connections. For instance, user can use his or her wallet to
log in to new decentralised app. They may not need to repeatedly create fresh profiles and log in
to new applications as Web 5.0 will aim to give users “decentralised identity” allowing them to
seamlessly move from one app to another. User data, rather than getting stored with 3 rd -party
products and services, will be controlled by users and only be exposed with their permission.
• Web 5.0, being developed by Jack Dorsey’s bitcoin business unit “TBD”, is reportedly trying to
solve all problems related to “identity and data” in current web sys tem. It aims to give data
ownership to users where users will control it.
 Feature:
• Simply put, Web 5.0 is Web 2.0 + Web 3.0 that will allow users to ‘own their identity’ on Internet
and ‘control their data’.
• Both Web 3.0 and Web 5.0 envision Internet without threat of censorship – from governments or
big tech, and without fear of significant outages.
 Internet Suspension / Internet Shutdown [India]:
→ What:
 Internet shutdowns are measures taken by government or on behalf of government, to intentionally disrupt
access to and use of information and communications systems online.
→ Laws:

Page 347 of 719

  Indian Telegraph Act, 1885:
 Criminal Procedure Code (CrPC), 1973.
 Information Technology (IT) Act, 2000.
→ History:
 Before 2017, Internet suspension orders were issued under 144 CrPC. After 2017, Internet suspension orders
are issued under Temporary Suspension of Telecom Services (Public Emergency or Public Safety) Rules, 2017
under Indian Telegraph Act, 1885.
→ Status:
 Currently, internet shutdown orders are governed under Temporary Suspension of Telecom Services (Public
Emergency or Public Safety) Rules, 2017. These 2017 rules framed by DoT say temporary suspensions can be
“due to public emergency or public safety”, and gives senior bureaucrats from Home Ministry at central and
State levels power to order shutdowns.
 As per one 2022 OHCHR report (UN-backed) highlighted that #KeepItOn coalition, which monitors internet
shutdowns episodes across world, documented 931 shutdowns between 2016 and 2021 in 74 countries, with
some countries blocking communications repeatedly and over long periods of time.
 As per #KeepItOn coalition (which monitors internet shutdown episodes across the world), documented 931
shutdowns in 74 countries from 2016-2021.
 According to one report of “Access Now” (one digital right advocacy group), India blocked or disrupted internet
connections 106 times and majority of India’s internet shutdown episodes were in Jammu & Kashmir.
 Civil society estimates that India has imposed maximum number of internet shutdowns for at least last 4 years.
 India enforced as many as 106 internet shutdowns in 2021. India was 3 rd in terms of total duration of domestic
internet shutdowns, behind Myanmar, Nigeria.
→ Reasons:
 To contain protests and political crisis: Almost 1/2th of all shutdowns recorded by civil society groups from 2016-
2021 were carried out in context of protests and political crises related to social, political or economic
grievances.
→ Impact:
 Economic cost: It disrupts financial transactions, entrepreneurship, commerce and industry. WB recently
calculated that Internet shutdowns in Myanmar alone had cost nearly USD 2.8 billion in 2021, reversing
economic progress made over previous decade.
 Disrupts political transparency: Such disruptions undermine or eliminate access to digital tools that are critical
for campaigning, promoting public discussion, conducting voting, and overseeing electoral processes. Example,
Shutdowns following protests during electoral periods in Belarus and Niger.
 Disrupts civic life: Example, societal debates, works of NGO, SHG.
 Interferes with health and education: E.g., digital education, tele-medicines.
 Endangers vulnerable sections: Women and girls who are in need of support and protection.
 Loss of creativity: People are not able to utilize their online creativity and long-term disruption may also affect
their mental health.
 Violates FR.
 It paralyse lives of people.
→ Criticisms:
 Despite Telecom Suspension Rules 2017, government commonly uses broad powers u/s 144 CrPC.
 India is under scrutiny because of:
• 2019-20: Communication shutdowns in Delhi, Assam during protests against Citizenship Amendment Act,
2019
• Internet curbs in JK.
• 2021: Communication shutdowns in Delhi during farmer’s protest. Centre in face-off over its new IT rules
2021 with tech giants – Twitter, facebook etc. Twitter describes police search at its offices in India as
potential threat to freedom of expression.
→ Judiciary:
 Supreme Court Observation:
• Right to Internet: Supreme Court says Right to Internet is fundamental right (FR), though not absolute i.e.
subject to reasonable restrictions and says it is implicit under Article 19.
• FR shall not be restricted arbitrarily: FR freedoms shall only be restricted as last resort after relevant factors
have been considered and no other options are available.
• Internet services cannot be suspended indefinitely. [Note: Because of this Supreme Court ruling,
government notified Telecom Suspension Rules, 2017].
• Restrictions imposed should be in sync with Article 19 mandate, inclusive of Test of Proportionality.
• In 2020, Supreme Court lays down Internet Suspension Framework.
• Supreme Court lays down rights and legal options available to citizens when Internet is suspended.
• Supreme Court says there should be balance between national security and human rights.
Page 348 of 719
 • Suspension of internet services indefinitely is also violation of telecom rules.
Supreme Court Guidelines:
• Supreme Court recognised that 2017 Rules (Telecom Suspension Rules, 2017) are only procedure to be
followed to suspend Internet services in occurrence of “public emergency” or for it to be “in interest of
public safety”. Its verdict reiterated that competent authority to issue order under Suspension Rules, in
ordinary circumstances, would be Secretary to Ministry of Home Affairs. Rules also say that in case
confirmation does not come from competent authority, orders shall cease to exist within period of 24 hours.
Clear reasons for such orders need to be given in writing, and need to be forwarded to one Review
Committee by next working day. Confirmation must not be mere formality, but must indicate independent
application of mind by that competent authority to that order passed by authorised officer, who must also
take into account changed circumstances if any, etc.
→ Recommendations:
 Stop imposing Internet shutdowns: It may be last recourse but should be used rarely for legitimate reasons.
 Legitimate shutdown: Need to control spread of hate speech, disinformation or other forms of content deemed
illegal or harmful.
 Clear policies: There should be unambiguous, publicly available and legitimate policy for any shutdown.
 Internet companies should engage and collaborate with stakeholders including government and civil society to
prevent such disruption.
Note:
 Indian Telegraph Act, 1885:
→ What:
 Interception of messages in interests of sovereignty and integrity of India. It is enabling legislation that governs
wired telegraphy; wireless telegraphy; telephones; teletype; radio communications; digital data
communications.
→ Government of India has exclusive jurisdiction.
→ Government law enforcement agencies can monitor / intercept communications, tap phone lines in accordance with
Constitution.
→ Central govt. and State governments can prevent message transmission on ground of public emergency; public
safety; sovereignty and integrity of India; security of state.
→ Temporary Suspension of Telecom Services (Public Emergency or Public Safety) Rules 2017:
 It is notified under Indian Telegraph Act, 1885.
 Central govt. and State governments can suspend telecom services – Internet etc. on ground of public
emergency or public safety
 It governs suspension, shutdown or any disruption in telcom services but only upto 15 days at once.
 Test of Proportionality:
→ “courts will quash exercise of discretionary powers in which there is no reasonable relation between objective which
is sought to be achieved and means used to that end, or where punishments imposed by administrative bodies or
inferior courts are wholly out of proportion to relevant misconduct”. This test is among most important grounds for
judicial review. Example – punishment should be in proportion to degree of crime committed.
Question:
 Web 3-0 technology enables people to control their own data. In Web 3-0 world, there can be blockchain-based social
networks. Web 3-0 is operated by users collectively rather than corporation.
Mains Link:
 Are Internet shutdowns healthy for India? Critically analyse and also comment on the recent trends associated and the
laws governing it. (250 words)
 What is web 5.0? Discuss its significance.

HYDROGEN (H)
News:
 2021:
→ As announced in Union budget 2021-2022, National Hydrogen Mission / National Hydrogen Energy Mission (NHM)
initiative launched by GoI.
→ India hosted summit on Green Hydrogen initiatives involving BRICS nations.
→ NTPC Renewable Energy Ltd (NTPC REL), subsidiary of NTPC, will set up India’s 1st green Hydrogen Mobility project
in Ladakh.
→ Under ‘Net Zero Carbon Emission by 2030’, Indian Railways set to run trains on hydrogen fuel-based technology.
→ Supported by DST Nano Mission NATDP project, Indian scientists develops large-scale reactor which produces
substantial amount of hydrogen using sustainable sources – sunlight, water, which is cost-effective, sustainable
process. Earth-abundant chemical - carbon nitrides was used as catalyst.
→ Centre is planning to make green hydrogen fuel from wastewater by using solar energy and electrolyzers. [By
segregation of solid waste management using rooftop solar, we can make green hydrogen with help of electrolysers.]
 2022:
Page 349 of 719
 → In line with National Hydrogen Mission, GAIL starts India’s 1st-of-its-kind project (in Indore, MP) of mixing hydrogen
into natural gas system to establish techno-commercial feasibility of blending hydrogen in City Gas Distribution (CGD)
network. [Hydrogen used is grey hydrogen and it would subsequently be replaced by green hydrogen]. [This project
marks stepping stone of India’s journey towards hydrogen based and carbon neutral future.]
→ Atmanirbhar India can produce Green Hydrogen for world.
→ Ministry of Power notifies Green Hydrogen/Green Ammonia Policy for production of Green Hydrogen or Green
Ammonia using renewable sources of energy.
→ Indian Oil Corporation Ltd. (IOCL), Larsen & Toubro (L&T), and ReNew Power (ReNew) sign binding term sheet to set
up one Joint Venture (JV) company to develop green hydrogen sector in India. This Joint Venture will aim to supply
green hydrogen at “industrial scale”.
→ India’s 1st pure green hydrogen plant commissioned in Jorhat, Assam.
→ India, being tropical country, has significant edge in green hydrogen production due to its favourable geographical
conditions and abundant natural resources. Therefore, at recently held WEF in Davos, Switzerland, India said it will
emerge as leader of green hydrogen by taking advantage of current energy crisis across globe.
→ One 2022 NITI Aayog report (Harnessing Green Hydrogen: Opportunities for Deep Decarbonisation in India)
highlights that Green hydrogen can substantially spur industrial decarbonisation and economic growth for India in
coming decades. And that, Green Hydrogen is critical to India’s economic development and Net-zero ambitions.
→ Indian Institute of Science (IISc) develops one technology to produce green hydrogen from biomass. This indigenous
technology is one step toward achieving goal of Atmanirbhar Bharat, National Hydrogen Energy Roadmap (NHERM).
 Conversion of Biomass to Hydrogen:
• Biomass (+ oxygen, stream) -> Syngas (hydrogen rich fuel gas mixture) -> (inside low pressure gas separation
unit) Pure Hydrogen. That is, Biomass is 1st converted into syngas in one novel reactor using oxygen and
steam. In 2nd step, pure hydrogen is generated from syngas using one indigenously developed low-pressure
gas separation unit.
→ According to one study published in 2022 in journal – “Nature Energy” as titled “Probabilistic feasibility space of
scaling up green hydrogen supply”, betting on green hydrogen to fulfil energy needs is ‘risky’. Its supply will likely
remain scarce in short-term and uncertain in long term even if its growth is at par with solar and wind energies.
Green hydrogen would likely supply < 1% of final energy globally by 2035. EU could reach this 1% mark by 2030. EU
target to replace natural gas, coal, oil in some sectors; but global electrolyser capacity needs to grow 6,000-8,000-
fold by 2050].
About:
 What:
→ lightest element
→ 1st element on periodic table.
→ Since weight of hydrogen is less than air, hydrogen rises in atmosphere and is therefore rarely found in its pure form,
H2.
 Property:
→ At normal environment, hydrogen is diatomic gas, invisible gas, Non-toxic, Non-metallic, Odorless, Tasteless,
Colorless, highly combustible.
 Occurrence:
→ most abundant element in universe.
→ Sun and stars are composed largely of hydrogen.
→ Water is most abundant compound of hydrogen found on earth.
→ Molecular hydrogen (H2) is not available on Earth in convenient natural reservoirs.
→ Most hydrogen on Earth is bonded to oxygen in water and to carbon in living / dead / fossilized biomass.
 Production:
→ Through chemical processes, organic materials - fossil fuels, biomass etc. - are used for releasing hydrogen.
→ Hydrogen can be created by splitting water (electrolysis) - into hydrogen and oxygen.
→ Hydrogen can be produced using different processes. Source of energy used and method define whether hydrogen
is informally considered Green hydrogen, Blue hydrogen or Grey hydrogen.
 Types (Depending on source):
→ Grey Hydrogen:
 Hydrogen produced from fossil fuels via carbon intensive processes.
 It is produced using natural gas via “steam reformation”, but with no carbon capture and storage.
 It is of similar process to blue hydrogen but CO2 is not captured and is released into atmosphere.
 96% of hydrogen produced, currently.
 Characteristic: Intensive CO2 emission, Low cost, Low social acceptance.
→ Blue Hydrogen:
 Grey hydrogen whose CO₂ emitted during production is sequestered via carbon capture and storage (CCS).
 It is when natural gas is split into hydrogen and CO2. Said CO2 is captured and then stored.
 It is produced using natural gas via “steam reformation”, and most of GHG emissions are captured and stored.

Page 350 of 719

  Characteristic: Low CO2 emission, Expensive, Higher social acceptance.
→ Green Hydrogen:
 What:
• Hydrogen produced by electrolysis of water using renewable energy which has no carbon footprint.
• hydrogen-produced fuel obtained from electrolysis of water with electricity generated by low-carbon
power sources.
• hydrogen produced by splitting water by electrolysis using electricity from renewable energy sources like
wind, solar. This produces only hydrogen and oxygen.
• Electricity from renewable sources is used to electrolyse water (H2O) and separate hydrogen (H2) and
oxygen (O)
• Low or zero-emission hydrogen produced using clean energy sources.
 Characteristic:
• Zero CO2 emission
• Expensive
• Highest social acceptance.
 Need:
• Vast majority of industrial hydrogen is currently produced from natural gas through conventional process
[steam methane reforming (SMR)] with large quantities of by CO2product.
• Dependence on natural gas and coal means that hydrogen production today generates significant CO2
emissions.
→ Turquoise Hydrogen:
 Hydrogen produced using natural gas via “pyrolisis” by separating methane (CH4) into hydrogen (H2) and solid
carbon dioxide (CO2).
→ Brown hydrogen:
 It is produced using coal instead of natural gas, but with no carbon capture and storage. This is cheapest form
of all.
 Storage:
→ Hydrogen can be stored physically as either gas or liquid. [Hydrogen is stored as compressed gas or cryogenic liquid]
→ Hydrogen can also be stored on surfaces of solids (by adsorption) or within solids (by absorption).
 Transportation:
→ Hydrogen is transported in cylinders, tubes, cryogenic tanks.
 Usage:
→ in fuel cells
→ in internal combustion engines – commercial vehicles.
→ as fuel / propellant for spacecraft propulsion.
 Hydrogen Energy / Hydrogen Fuel:
→ What:
 Hydrogen burns with oxygen to produce energy.
 Hydrogen fuel is zero-emission fuel
 Energy transition is underway at exceptional level. Many countries are betting on hydrogen to emerge as top
clean fuel because of hydrogen’s high energy density and high versatility.
→ Methods of production of Hydrogen fuel:
 Natural gas reforming (thermal process); Electrolysis; solar-driven; biological.
→ Uses:
 Hydrogen fuel can be used in fuel cells for internal combustion engines.
 Hydrogen fuel is also used as fuel for spacecraft propulsion.
→ India’s potential:
 India, being tropical country, has significant edge in green hydrogen production due to its favourable
geographical conditions and abundant natural resources. Producing hydrogen from renewables in India is likely
to be cheaper than producing it from natural gas.
 Indian firms such as NTPC Ltd, Indian Oil Corporation, Acme Solar, Reliance Industries and Adani Group and
Greenko are looking at green hydrogen as new business opportunity for extracting energy.
 India has huge edge in green hydrogen production owing to its favorable geographic conditions and presence of
abundant natural elements.
 Cheap renewable energy tariffs: India will become net exporter of green hydrogen by 2030 due to its cheap
renewable energy tariffs.
 Hydrogen FCEV (Fuel Cell electric vehicles) are comparatively better than battery electric vehicles, and this will
reduce India’s demand for REE used for manufacturing batteries for electric vehicles.
 Green Hydrogen can help in reducing India’s CAD by reducing import dependency on fossil fuels.
 Helps tackling uncertainty in Global energy markets.
→ Efforts by India:
Page 351 of 719
  Centre is planning to use green hydrogen fuel from wastewater by using solar energy. [It is possible
by using electrolyzers. By segregation of solid waste management using rooftop solar, we can make
green hydrogen with help of electrolysers. Power and wa ter cost of producing gree hydrogen would
be negligible. We can use this Green Hydrogen fuel in railway engines, cement, chemical companies
instead of coal].
 National Hydrogen Energy Board (2003): It implements and monitors National Hydrogen Energy Road Map.
 National Hydrogen Energy Roadmap (2006).
 Mission Innovation [2015]: It is one global initiative to accelerate global clean energy innovation. India is one
partner country.
 Green Hydrogen Policy (GHP) [2022]: This Policy of Ministry of Power set target of 5 million tonnes per annum
(MTPA) of green hydrogen production by 2030, to meet about 40% of domestic requirements in India.
 Union budget 2021-22 formally announced National Hydrogen Mission (NHM) which aims to increase Green
Hydrogen production to meet about 40% of domestic requirements by 2030.
 Ministry of New and Renewable Energy (MNRE).
 NTPC Renewable Energy Ltd (NTPC REL), subsidiary of NTPC, will set up India’s 1 st Green Hydrogen Mobility
project in Ladakh.
 Centre is considering proposal to introduce Rs. 15,000-crore Production Linked Incentive (PLI) scheme for
electrolysers.
 In 2022, centre notified green hydrogen / green ammonia policy that offers 25 years of free power for any new
renewable energy plants set up for green hydrogen production before 2025.
 Centre is also planning to introduce mandates requiring that oil refining, fertiliser and steel sectors procure green
hydrogen for certain proportion of their requirements.
→ Global effort:
 EU target to replace natural gas, coal, oil in some sectors: EU set target of achieving 10 million tonnes of domestic
renewable hydrogen production by 2022. It plans 10 million tonnes of imports by 2030 to replace natural gas,
coal and oil in certain industries and transport sectors.
→ Challenges for India:
 Path for green hydrogen in India is not clear. Currently, production of green hydrogen is slightly more
expensive than grey hydrogen.
 Economic sustainability of extracting green / blue hydrogen.
 Nascent technology: Tech. is still in baby stage for production of hydrogen, for Carbon Capture and Storage (CCS)
and for hydrogen fuel cell.
 Expensive cost of production of hydrogen.
 High maintenance costs for hydrogen fuel cells
 Need investment in R&D, infrastructure for production, storage, transportation and demand creation for
hydrogen.
→ Global challenge:
 Low investment. Low stage of technology for sustainable production. Challenges in ramping up supply
of electrolysers — device in which green hydrogen is produced. Electrolysis capacity is still tiny
compared to where we need to be in 2050 for Net Zero emissions scenarios.
→ Significance:
 Due to its ability to power fuel cells in zero-emission electric vehicles, hydrogen fuel potential for domestic
production, and hydrogen fuel cell’s potential for high efficiency is considered alternative.
 Water is only by-product that results from hydrogen fuel that makes it 100% clean.
 Zero-emission fuel: Its only by-product / emission is water and thus 100% clean and thereby reducing GHG
emissions. It is seen as alternative fuel.
 High energy density: For same energy, less hydrogen in kilogram is required than gasoline.
 high versatility.
 Electricity generation through fuel cells in remote tribal areas, hydrogen stoves, powering small gadgets
 It may power transformers and e-vehicles in future.
 High efficiency: It is more efficient than internal combustion engine running on gasoline. For same energy, less
hydrogen in kilogram is required than gasoline.
 Introducing H-CNG as technology in one big way for both automotive and domestic cooking applications.
 Green hydrogen energy is vital for India to meet its Nationally Determined Contribution (NDC) targets.
 Green Hydrogen can act as option for energy storage.
 Green Hydrogen can help ensuring regional, national energy security.
 Green Hydrogen is clean-burning, thus in decarbonization in sectors - iron and steel, chemicals, fertilizers, power,
shipping, transportation etc.
 Green Hydrogen blending can be adopted in City Gas Distribution (CGD) networks, to gain widespread
acceptance.

Page 352 of 719

 
Green hydrogen enables deep decarbonization of difficult-to-abate emissions from refining industry, fertiliser
industry, steel industry, cement industry and also from heavy commercial transportation sector.
 Green hydrogen has significantly lower carbon emissions than grey hydrogen, which is produced by steam
reforming of natural gas, which makes up bulk of hydrogen market.
→ Way Forward:
 Implementing strong policies could reverse setbacks and thus fostering green hydrogen growth will
therefore require strong dedication, coordination and funding along entire value chain. Carbon pricing
should always form basis of climate policy [Carbon pricing is one policy tool that puts tax on producers
of GHG emissions]. Accelerating roll-out of crucial zero-carbon technologies like electric mobility, heat
pump.
Note:
 National Hydrogen Energy Roadmap (NHERM) [2006]:
→ What:
 It provides blueprint for hydrogen energy development in India. NHERM is one program in India initiated by
National Hydrogen Energy Board (NHEB) in 2003 and approved in 2006 for bridging technological gaps in
different areas of hydrogen energy, including its production, storage, transportation and delivery, applications,
safety, codes and standards and capacity building for period up to 2020. This program is under direction of
MNRE.
 It is one initiative of GOI that aims to promote use of hydrogen as fuel and reduce dependence on fossil fuels.
→ Aim:
 This project aims to reduce India's dependence on import of petroleum products, promote use of diverse,
domestic, and sustainable new and renewable energy sources; to provide electricity to remote, far‐flung, rural
and other electricity deficient areas and promote use of hydrogen as fuel for transport and power generation;
to reduce carbon emissions from energy production and consumption, to increase reliability and efficiency of
electricity generation; to generate 1000 MW electricity using fuel cells by 2020 and 1 Million vehicles running
on Hydrogen based IC Engines and fuel cells by 2020.
 National Hydrogen Mission (NHM) / National Hydrogen Energy Mission (NHEM):
→ generation of hydrogen from green power resources
→ Aim:
 to make India global hub for production and export of green hydrogen.
 Aid government in meeting its climate targets. To increase production to 5 million metric tonnes (MMT) by 2030
to meet about 40% of domestic requirements.
→ Impact:
 It may mandate fertilizer, steel, petrochemicals industries to shift to green hydrogen use.
 Green hydrogen production will make replace energy imports.
 Green Hydrogen / Green Ammonia Policy [2022]:
→ What:
 One major policy enabler by Government for production of Green Hydrogen / Green Ammonia using
Renewable sources of energy.
 One step forward towards National Hydrogen Mission.
→ Need:
 Hydrogen and Ammonia are envisaged to be future fuels to replace fossil fuels. Production of these
fuels by using power from renewable energy, termed as green hydrogen and green ammonia, is one
of major requirements towards environmentally sustainable energy security o f India. Thus,
Government of India is taking various measures to facilitate transition from fossil fuel / fossil fuel
based feed stocks to green hydrogen / green ammonia.
→ Provision:
 Green Hydrogen / Ammonia manufacturers may purchase renewable power from p ower exchange or
set up renewable energy capacity themselves or through any other, developer, anywhere.
 Open access will be granted within 15 days of receipt of application.
 Green Hydrogen / Ammonia manufacturer can bank his unconsumed renewable power, up to 30 days,
with distribution company and take it back when required.
 Distribution licensees can also procure and supply Renewable Energy to manufacturers of Green
Hydrogen / Green Ammonia in their States at concessional prices which will only include cost of
procurement, wheeling charges and small margin as determined by State Commission.
 Waiver of inter-State transmission charges for period of 25 years will be allowed to manufacturers of
Green Hydrogen and Green Ammonia for projects commissioned before 20 25.
 Manufacturers of Green Hydrogen / Ammonia and renewable energy plant shall be given connectivity
to grid on priority basis to avoid any procedural delays.
 Benefit of Renewable Purchase Obligation (RPO) will be granted incentive to hydrogen / Ammonia
manufacturer and Distribution licensee for consumption of renewable power.

Page 353 of 719

  To ensure ease of doing business, one single portal for carrying out all activities including statutory
clearances in time bound manner will be set up by MNRE.
 Connectivity, at generation end and Green Hydrogen / Green Ammonia manufacturing end, to inter -
State transmission system (ISTS) for Renewable Energy capacity set up for purpose of manufacturing
Green Hydrogen / Green Ammonia shall be granted on priority.
 Manufacturers of Green Hydrogen / Green Ammonia shall be allowed to set up bunkers near Ports for
storage of Green Ammonia for export / use by shipping. Land for storage for this purpose shall be
provided by respective Port Authorities at applicable charges.
→ Significance:
 Implementation of this Policy will provide clean fuel to common people of India.
 This will reduce dependence on fossil fuel and also reduce crude oil imports.
 It will help emerge India as export Hub for Green Hydrogen and Green Ammonia.
 This policy promotes Renewable Energy (RE) generation as RE will be basic ingredient in making green
hydrogen. This in turn will help in meeting international commitments for c lean energy.
 Blending hydrogen with natural gas:
→ Goal:
 Government plans to blend 15% green hydrogen with piped natural gas (PNG) for domestic, commercial,
industrial consumption.
→ Need:
 Zero-emission hydrogen is latest buzzword around world.
 India committed to achieving net-zero carbon emissions by 2070. And hydrogen together with renewable energy
is seen as key to achieving that 2070 goal.
 For transition, natural gas is fuel and government is looking to raise its share in primary energy basket to 15%
by 2030.
→ Importance:
 Hydrogen-enriched Compressed Natural Gas (HCNG) is easier and safer to use than hydrogen because it contains
very low energy content from hydrogen.
 Hydrogen-enriched Compressed Natural Gas (HCNG) will ensure reduction in carbon monoxide (CO) emissions
compared to CNG.
 Power output of HCNG is better than CNG.
 It reduces carbon intensity of methane.
 Harnessing Green Hydrogen: Opportunities for Deep Decarbonisation in India [2022]:
→ This 2022 NITI Aayog report highlighted that Green hydrogen can substantially spur industrial
decarbonisation and economic growth for India in coming decades. And that, Green Hydrogen is critical to
India’s economic development and Net-zero ambitions. Findings:
 Status: Hydrogen demand of India could 4-fold by 2050 (nearly 10% of global demand).
 Decarbonisation: Green hydrogen is crucial for sectors such as fertilizers, refining, methanol, maritime shipping
etc.
 Green Hydrogen Corridor: India needs to form Green Hydrogen corridors across India. Governments should
provide grants to startups as well as support entrepreneurs to promote green hydrogen.
 Facilitate investment through demand aggregation and dollar-based bidding for green hydrogen.
 Promote export of green hydrogen and green hydrogen-embedded products through one global hydrogen
alliance.
 Make green hydrogen competitive w.r.t. grey hydrogen.
 Encourage market development by using industrial cluster, and Viability Gap Funding.
 Initiate Green Hydrogen standards and one labelling programme.
Value Addition:
 Under Petroleum and Natural Gas Regulatory Board Act, 2006, Petroleum and Natural Gas Regulatory Board (PNGRB)
grants authorization to entities for developing City Gas Distribution (CGD) network in specified geographic area of India.
Mains Link:
 Harnessing green hydrogen’s potential will play a key role in tackling critical energy challenges and also in ensuring non-
fossil fuel-based energy. Discuss. (250 words)

FOREST
News:
 2020:
→ Satellite study shows high rate of deforestation in Papum Reserve Forest, Arunachal.
→ Maharashtra announces reservation of some acres of Aarey land as forest, claiming it as 1 stinstance of extensive
forest blossoming within metropolis anywhere in world.
→ UN Food and Agriculture Organization (UNFAO) releases 2020 Global Forest Resources Assessment.
→ MoEFCC launches Nagar Van scheme / Urban Forest scheme.

Page 354 of 719

 → MoEFCC refuses to grant exemption to Mines Ministry from paying NPV (forest) saying that it would be
inappropriate to grant exemption as this was mandated by Supreme Court.
 2021:
→ Manipur emerges as modal state for Van Dhan Vikas Yojana.
→ Ministry of Environment, Forest and Climate Change (MoEFCC) proposes amendments to FCA, 1980.
 Concern: Proposed amendments would dilute landmark 1996 Godavarman judgment of Hon’ble Supreme Court
of India.
→ FSI releases report on forest fires in country.
→ In start of 2021, series of forest fires occurred in HP, Nagaland-Manipur border, Odisha, MP, Gujarat.
→ NGT orders all encroachments to be removed from Banni grasslands, Gujarat. [Banni grasslands is
ecologically-sensitive]. NGT also said Maldharis will continue to hold right to conserve community forests in
Banni Grasslands, granted to them as per Forest Rights Act, 2006.i.e. NGT upholds rights of pastoralists in
Banni grasslands.
→ Ministry of Environment (MoEFCC) and Ministry of Tribal Affairs (MoTA) jointly issued circular to Chief
Secretaries of all States, giving responsibility of implementing Forest Rights Act, 2006 to State governments.
→ Under Forest Rights Act, 2006, Individual right certificates and community right certificates were handed
over to beneficiaries of Gujjar-Bakerwal communities, Gaddi-Sippi communities in Jammu & Kashmir.
→ Union Government proposed amendments to FCA, 1980.
→ President empowers (under Article 239) Lieutenant Governor of Ladakh to exercise powers and discharge
functions of State Government under Scheduled Tribes and Other Traditional Forest Dwellers (Recognition
of Forest Rights) Act, 2006 within Ladakh UT.
→ CAMPA disbursed from Compensatory Afforestation Fund (CAF) thousands of crores to many States
(Chhattisgarh, Odisha, Jharkhand, Maharashtra, etc).
 2022:
→ MoEFCC releases 2021 India State of Forest Report (ISFR).
→ Economic survey 2021-22 says:
 India increased its forest area in past decade. India ranks 3rd globally in annual net gain in forest area.
 Forests covered 24% of India’s total geographical area, accounting for 2% of world’s total forest area.
 Among Indian States, Madhya Pradesh (11% of India’s total forest cover) has largest area under forests, followed
by Arunachal, Chhattisgarh, Odisha, Maharashtra.
 Top 5 States in terms of highest % of forest cover to geographical area of State - Mizoram, Arunachal, Meghalaya,
Manipur (74%), Nagaland.
 Top 10 countries account for 66% of world’s forest area. Of these Brazil (highest), Peru, Congo, Russia have 1/2
or more of their total geographical area under forests.
→ HP government says it settled 164 claims filed under Forests Rights Act, 2006.
→ Ignoring Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 law
that stresses that original inhabitants, traditional forest dwellers and Adivasis must not be evicted from Tiger
Reserves, MoEFCC simply stated that they will be rehabilitated so that they do not lose thei r traditional
livelihood. No details on any modalities have, however, been provided. Thus, activists are raising voice for
protection of these vulnerable sections under provisions of Forest Rights Act, 2006.
→ Forest fires in Uttarakhand and Himachal Pradesh burn numerous hectares of greenery.
→ At 15 th World Forestry Congress held in Seoul, South Korea, participant 160 countries declare Seoul Forest
Declaration [2022].
→ Chhattisgarh government becomes only 2 nd State in India to recognise Community Forest Resource (CFR)
rights of village inside national park. CFR rights of tribals living in one hamlet inside Kanger Ghati National
Park, were recognised, giving community power to formulate rules for forest use. [I n 2016, Odisha
government became 1 st to recognise Community Forest Resources (CFRs) inside Simplipal National Park].
→ MoEFCC notifies Forest (Conservation) Rules, 2022 under Forest (Conservation) Act, 1980 and in supersession
of Forest (Conservation) Rules, 2003.
→ About 100 women, employed under MGNREGA, were seen digging pits, planting trees and watering them in
Nangal Khurd village, in Punjab, just in time for World Environment Day that is observed every year. [Focus
now is on ‘forest landscape restoration’, to regain ecological functionality and improve human welfare.]
→ MoEFCC organizes Hariyali Mahotsav.
→ MoEFCC is reviewing to decriminalize Indian Forest Act, 1927.
→ Congress and BJP debates on latest version of Forest (Conservation) Rules, 2022.
→ Forest fires rage in scorching SW Europe. In France, Greece, Portugal, Spain, blaze destroys thousands of
hectares of land, forces thousands from their homes and kills several emergency personnel. Firefighters are
struggling to contain wildfires sweeping across SW Europe as heatwave showed no sign of abating, with
Britain poised to set new temperature records.
→ Chhattisgarh government had transferred area in Bastar region from Forest department to Revenue
department to ensure easy availability of land for setting up industries and building infrastructure. Now,

Page 355 of 719

 there is tussle between MoEFCC and Chhattisgarh government over transfer of these lands from its forest to
Revenue department.
 Centre argument: Un-demarcated protected forest cannot be used for non -forest purposes without its
consent under Forest (Conservation) Act, 1980.
 Chhattisgarh Govt’s argument: Transferred land was not forest land.
→ USA [US Agency for International Development (USAID) ] and India (MoEFCC) launch new initiative /
program - “Trees Outside Forests in India” - to increase tree coverage in India outside of forest lands in
India in bid to support global climate change mitigation and adaptation goals. [This move will enhance
carbon sequestration, support local communities, strengthen climate resilience of agriculture].
→ National Commission for Scheduled Tribes (NCST) recommends to Forest Ministry to put Forest
(Conservation) Rules, 2022 on hold. Harsh Chouhan, the Chairperson of NCST gives the reason for
recommending to GOI that it is the duty of the commission to “caution the government” when its policies
have the potential to affect the well-being and rights of tribal people.
 Reason:
• NCST says the 2022 rules essentially eliminate the requirement of consent of local tribespeople
and forest dwellers for diversion of forest land for other purposes. This would amount to infringing
upon the land rights of tribespeople under Forest Rights Act, 2006. [This is an argument the
Opposition Congress had been making since 2022 rules were issued].
About:
 What:
→ Before 1996 Supreme Court Godavarman judgement, forest land was only that defined by 1927 Indian
Forest Act.
→ But, Supreme Court in 1996 Godavarman judgement expanded definition of “forest” by saying word ‘forest’
must be understood according to its dictionary meaning. And, Supreme Court included all areas recorded
as ‘forest’ in any government record, irrespective of ownership, recognition and classification.
→ Forest covers 23% of geographical area of India.
 Forest Division in India:
→ Reserve Forest:
 What:
• forests which are given certain degree of protection.
• Term “Reserve Forest”, 1st introduced in Indian Forest Act, 1927 in British India. And, it means forests which
are granted protection under British crown in British India [though not associated with suzerainty].
 Feature:
• Reserve forests are most restricted forests. Local people are prohibited, unless specifically allowed
by Forest officer.
 Declaration:
• Reserved forests are declared by respective State governments. [unlike national parks, wildlife sanctuaries]
• Indian Forests Act, 1927 defines procedure to be followed for declaring area / forest as: reserved forest,
protected forest; or village forest.
→ Protected forest:
 Protected forest are reserved forest where activities such as hunting, grazing are sometimes allowed
for communities living on fringes of that forest.
→ Unclassified Forest:
 Forests other than reserved and protected forests are unclassified f orest. In India, unclassified forests
are in majority in NE States.
→ Fact: Reserved forest (55%) > Protected forest (28%) > Unclassified forest (17%).
 Deemed Forest:
→ Karnataka government identified ‘deemed forest’ as land having characteristic of forests irrespective of ownership.
→ This includes: thickly wooded areas of revenue department not handed over to forest department; thickly wooded
areas recommended to be handed over to forest department; thickly wooded land distributed to grantees but not
cultivated; thickly wooded plantations of forest department.
 Trees Outside Forests (TOF):
→ In India, Forest Survey of India (FSI) defines TOF as “All trees growing outside recorded forest areas irrespective of
size of patch”.
→ Benefits: Enhance carbon sequestration, support local communities, strengthen climate resilience. TOF in India,
mainly growing on private land, are main source of wood in India for industry and domestic wood fuel.
→ Initiative: In 2022, USA [US Agency for International Development (USAID) ] and India (MoEFCC) launched
new initiative / program - “Trees Outside Forests in India” - to increase tree coverage in India outside of
forest lands in India in bid to support global climate change mitigation and adaptation goals. [This move
will enhance carbon sequestration, support local communities, strengthen climate resilience of
agriculture].

Page 356 of 719

 Judiciary:
→ 1996 Godavarman judgment:
 Supreme Court’s this judgment It paved way for calculating Net Present Value (NPV), or economic value of
portion of forest being destroyed for development work, that should be paid by project.
 Creation of Compensatory Afforestation Fund (CAF) in which all monies received from user agencies towards
compensatory afforestation, additional compensatory afforestation, penal compensatory afforestation, net
present value (NPV) of diverted forest land or catchment area treatment plan shall be deposited.
 Provide non-forestry land instead.
 Law:
→ Forest is in List III - Concurrent List. As per Supreme Court in TN Godavarman T. vs Union of India (1996),
States can define land (previously not classified under Centre or State records) as forests.
→ Jurisdiction of State Govt. over forest:
 State Forest department has jurisdiction over Reserve Forest (nothing allowed unless specified) and Protected
forests (everything allowed unless specified).
 State Revenue department has jurisdiction over village forest, and Nagarpallika forest.
→ Indian Forest Act, 1927.
→ Forest (Conservation) Act, 1980 / FCA, 1980:
 What:
• Act to provide for conservation of forests.
• It is principal legislation that regulates deforestation in India.
 Aim:
• To protect forests and wildlife; Dissuade State governments’ attempts to divert forest land for commercial
projects; Increase area under forests.
 Feature:
• prohibits felling of forests for any non-forestry use, without prior clearance from central government.
• It makes Centre’s permission mandatory for using State govt. notified forest land for non forestry purposes.
• It also makes mandatory to create advisory committee to recommend forest re-classification.
• Clearance process includes: seeking consent from local forest rights-holders; and seeking consent from
wildlife authorities.
• Centre is empowered to reject such requests or allow such requests with legally binding conditions.
→ Forest Rights Act (FRA), 2006:
 What:
• Scheduled Tribes and Other Forest Dwellers (Recognition of Forest Rights) Act, 2006.
• grants legal recognition to rights of traditional forest dwelling communities
 Aim:
• To correct historical injustices against forest dwellers in colonial era and in independent India.
 It recognises forest dwellers’s:
• Individual forest rights over their land / forest:
 Any Scheduled Tribe person can claim rights to live in and right to cultivate if he occupied it and
depended on it as of 2005.
 A non-tribal will have to prove his family’s residence in vicinity of forest for 75 years prior to
2005.
• Community Forest Rights to manage and conserve forest:
 It recognisesrights of gram sabha over forest land within village boudaries or seasonal use of
landscape for pastoral communities.
 It allows villagers to own and collect, use and dispose of Minor Forest Produce (Non -Timber),
including right to protect and regenerate any community resource etc.
 It grants rights:
• Title rights: ownership of land that is being cultivated before 2005 [i.e. no new lands after 2005 are
granted ownership].
• Usage rights: Minor Forest Produce (MFP); grazing areas; pastoralist routes etc.
• Relief rights: rehabilitation in case of illegal eviction or forced displacement.
• Forest management rights: to protect forests and wildlife.
 Eligibility:
• Forest Dwelling Scheduled Tribe (FDST):
 Must be Scheduled Tribe in that area where right is claimed; and
 Primarily resided in forest or forests land prior to 2005; and
 Depend on forest or forests land for bonafide livelihood needs.
• Other Traditional Forest Dweller (OTFD):
 Primarily resided in forest or forests land for 3 generations (75 years) pr ior to 2005.
 Depend on forest or forests land for bonafide livelihood needs.
Page 357 of 719
  Process of recognition of rights:
• Gram sabha / village assembly initiates by passing resolution, recommending whose rights to which
resources should be recognised.
• Gram Sabha resolution is then screened and approved at sub-division (taluka) level and subsequently
at district level.
 Screening committee:
• It consist of government officials and elected members of local body at that level.
• It also hear appeals.
 Criticism:
• Recognition of rights of forest dwellers is yet to be completed.
• Operationalisation of provision of duties of recognised forest dwellers is not fully implemented.
• Implementation is slow.
 Critical Wildlife Habitats:
• Forest Rights Act, 2006 defines it as – specific areas in national parks and sanctuaries which are kept
as inviolate for wildlife conservation.
→ Compensatory Afforestation Fund Act, 2016:
 What:
• Act to provide for establishment of funds under Public Account of India (PAI), Public Accounts of
States and crediting thereto monies received from user agencies towards compensatory
afforestation, additional compensatory afforestation, penal compensatory afforestation, net
present value (NPV), all other amounts recovered from such agencies under FCA, 1980.
• Act to constitute authority at national level, States, Union territory for administration of funds and
to utilise monies so collected for undertaking artificial regeneration (plantations), assisted natural
regeneration, protection of forests, forest related infrastructure development, Green India
Programme, wildlife protection, other related activities.
 Issue:
→ World is losing 10 million hectares of forest each year – about size of Iceland.
→ According to IUCN, deforestation and forest degradation contribute around 12% of global GHG emissions.
→ 30% of forestland is degraded in India. Total area occupied by primary forests in India has decreased.
→ Forest restoration in India faces hurdles in terms of identification of areas for restoration, lack of
importance accorded to research and scientific strategies in tree planting, stakeholders’ conflicts of
interest, and financing.
 Initiative:
→ National Forest Policy, 1988.
→ Van Dhan Vikas Yojana / Van Dhan Yojana:
 What:
• Forest Wealth Development Centre
• Initiative / scheme of govt. of India
 Aim:
• promote MFPs-centric livelihood development of tribal gatherers and tribal artisans.
• Mainstreaming tribal community, by promoting value addition to MFP.
• value addition, branding & marketing of MFPs by establishing Van Dhan Kendras.
 Feature:
• Tribal SHGs are constituted.
• To be trained
• Working capital to be provided.
• SHGs will market their products within / across States.
• Clusters formation.
• Processing facility at Van Dhan Vikas Kendras
• PPP model.
 Implementation:
• implemented by TRIFED -Nodal Agency at throughout country.
• Though: by Ministry of Tribal Affairs - Nodal Department at central level; State Nodal Agency for MFPs and
District collectors - at State level; Kendras – local level
 Significance:
• share of tribals in value chain of Non-Timber Forest Produce (NTFP) is expected to rise significantly.
• major scheme that contributes to employment and income generation among tribal population.
 Manipur: Emerges as Champion State where Van Dhan programme is leading major source of employment for
local tribals.
→ Nagar Van Scheme / Urban Forest / City Forest [2020]:
 What:
Page 358 of 719
 • scheme that emphasises on urban forestry. urban forests will be developed all over India in next 5 years.
opportunity to States to manage urban ecosystems.
 Need:
• Biodiversity conservation has traditionally been confined to remote forest areas. But, with increasing
urbanisation need has arisen to safeguard and save biodiversity in urban areas also. Thus, urban forestry is
best way to bridge this gap. India is endowed with rich biodiversity having several species of animals and
plants. India hosts 4 global bio-diversity hotspots containing several endemic species. However, increasing
population, deforestation, urbanisation and industrialisation have put our natural resources under pressure
causing loss of biodiversity. Biodiversity is vital for survival of all life form on this planet and is key to
providing various ecological services.
 Feature:
• To create 400 Urban Forest and 200 Nagar Vatikas in at least 20 hectares of land in urban areas during 2020-
25 on existing forest land or any other vacant land by Urban local bodies. Nagar Van will be maintained by
State Government. Funding: CAMPA Fund. Warje Urban Forest in Pune will be considered role model for
this Scheme.
 Significance:
• Cools air. Regulates water flow and improves water quality. Filters for urban pollutants. Mitigate Climate
change. Improves physical and mental health. Reduces air conditioning needs. Saves energy used for
heating. Increases urban biodiversity. Increases property value.
→ Compensatory Afforestation Fund Management and Planning Authority (CAMPA) [2004]:
 Intro:
• Development and industrial projects - erection of dams, mining, construction of industries, roads, etc.
require diversion of forest land. Any project, government or private, must apply for forest clearance from
Ministry of Environment and Forests (MoEF), before conversion of land take place. This proposal is to be
submitted through concerned State forest department. If clearance is given, then compensation for lost
forest land is also to be decided by MoEF and regulators.
 Origin:
• Due to discrepancies in implementation of compensatory afforestation, some NGOs approached Hon’ble
Supreme Court for relief. Hon’ble Supreme Court in 2009 issued orders to establish CAMPA as National
Advisory Council under chairmanship of Union Minister of Environment & Forests for monitoring, technical
assistance and evaluation of compensatory afforestation activities.
 Establishment:
• In pursuance of order of Honble Supreme Court of India, Ministry of Environment and Forests in
2004constituted CAMPA for purpose of management of money collected towards compensatory
afforestation (CA), net present value (NPV), other money recoverable from user agencies for utilizing forest
land for non-forest purposes under FCA, 1980.
 Objective:
• To promote afforestation activities, regeneration activities as way of compensating for forest land diverted
to non-forest use.
 Function:
• CAMPA executes Compensatory Afforestation Fund (CAF).
• CAMPA promotes afforestation and regeneration activities to compensate for land diverted to non-forest
uses.
 Status:
• In 2002, the Supreme Court created the ad hoc national CAMPA to compensate for forests cut down for
development work. A total of 54000 crore rupees was deposited into the fund through forest compensation
for decades. Since 2015, this fund has been slowly released to the States.
→ State CAMPAs.
→ National Afforestation Programme (NAP) scheme:
 NAP is implemented for afforestation of degraded forest lands. NAP scheme aims for ecological
restoration of degraded forests and to develop forest resources with peoples’ participation, with focus
on improvement in livelihoods of forest-fringe communities, especially poor. NAP aims to support and
accelerate on-going process of devolving forest conservation, protection, management and
development functions to Joint Forest Management Committees (JFMCs) at village level, which are
registered societies. This NAP scheme is implemented by 3 tier institutional setup through State Forest
Development Agency (SFDA) at State level, Forest Development Agency (FDA) at forest division level
and JFMCs at village level.
→ National Mission for Green India (GIM):
 GIM aims at improving quality of forest and increase forest cover besides cross sectoral activities on
landscape basis. GIM is one of 8 Missions under National Action Plan on Climate Change. GIM aims at
protecting, restoring and enhancing India’s forest cover and responding to Climate Chang e. Target

Page 359 of 719

 under GIM Mission is 10 m ha on forest and non -forest lands for increasing forest / tree cover and to
improve quality of existing forest.
→ Forest Fire Prevention & Management Scheme (FFPM): This GOI’s scheme takes care of forest fire
prevention and management measures.
→ Green Skill Development Programme (GSDP):
 Most vocational training programmes focus on mechanical / technical skills rather than ‘soft’ or ‘green’ skills.
Green skills contribute to preserving or restoring environmental quality for sustainable future and include jobs
that protect ecosystems and biodiversity, reduce energy and minimize waste and pollution. It is in line with Skill
India Mission. MoEF&CC took up this initiative for skill development in environment and forest sector to enable
India's youth to get gainful employment and / or self-employment. This GSDP programme endeavours to
develop green skilled workers having technical knowledge and commitment to sustainable development, which
will help in attainment of NDCs, SDGs, National Biodiversity Targets (NBTs), as well as Waste Management Rules.
GIM aims for restoring and enhancing forest cover and responding to climate change by combination of
adaptation and mitigation measures. GIM aims at protecting, restoring and enhancing India’s forest cover and
responding to Climate Change.
 In short, GSDP aspires youths to attain employment in environment and forest sectors.
→ Telangana initiated one large-scale tree planting programme called ‘Telangana Ku Haritha Haram’ using
drones.
→ UN Decade on Ecosystem Restoration [2021-30]:
 UN Decade on Ecosystem Restoration is one rallying call for protection and revival of ecosystems all around
world, for benefit of people and nature. It aims to halt degradation of ecosystems, and restore them to achieve
global goals. Only with healthy ecosystems can we enhance people’s livelihoods, counteract climate change, and
stop collapse of biodiversity. This UN Decade runs from 2021 through 2030, which is also deadline for SDGs and
timeline scientists have identified as last chance to prevent catastrophic climate change.
 It emphasizes efforts to restore degraded terrestrial ecosystems including forests.
→ Bonn Challenge [2011]:
 One global effort to restore 150 million hectares of world's degraded and deforested lands by 2020 and 350
million hectares by 2030.
 It was hosted and launched by Germany and IUCN in Bonn in 2011, in collaboration with Global Partnership on
Forest / Landscape Restoration.
 Under this Bonn declaration: India aims to reach target of restoring 26 million hectares of degraded land
by 2030. Additional carbon sink of 2.5 billion-3 billion tonnes of CO2 equivalent through forest and tree
cover is to be created by 2030. [India joined Bonn Challenge in 2015].
 Significance:
→ Forest meets livelihood needs of people living in and adjoining forests in villages.
→ Forests act as carbon sinks.
→ Forests act as regulators of water regime.
→ Around 1.6 billion people depend directly on forests for food, shelter, energy, medicines, income.
→ Forests are home to about 80% of world’s terrestrial biodiversity, with more that 60,000 tree species.
 Way Forward:
→ Nearly 2 billion hectares of degraded land in world (and 140 million hectares in India) have scope for
potential restoration as forest land.
→ Forest landscape restoration.
→ Ensure diversity of species while planting trees : Natural forests with diverse native tree species are more
efficient in sequestering carbon than monoculture tree plantations. Case study: In Punjab, one community
is proactively planting native species such as Jhand, Desi Kikar, Pharwan, which are resili ent and
acclimatised. And most of these saplings have high survival rate of 90%, one vital requirement for
sustainable reforestation activities.
→ Promote Sustainable forest crops (agroforestry): It reduces food insecurity and empowers women,
allowing them to gain access to more nutritional diets and new income streams. Agroforestry lessens rural -
to-urban migration and contributes to increase in resources and household income. Planting trees is deeply
linked to ‘wholistic’ well-being of all individuals, community, and Earth.
Note:
 Indian Forest Act, 1927:
→ What:
 Act to consolidate law relating to forests, transit of forest -produce and duty leviable on timber and
other forest-produce.
→ Feature:
 This Act classifies forests into 3 – reserved forests, protected forests, village forests .

Page 360 of 719

  This Act attempts to regulate collection of forests produce by forest dwellers, and some activities were
declared as offences and imprisonment and fines were imposed and to establish state control over
forests.
→ Reforms suggested:
 Decriminalization of kindling of fire or carrying fire in forest areas, felling and dragging timbers.
 Violation of this Act to attract only fine of Rs. 500 (previously it was 6 -month imprisonment and fine)
 Forest Landscape Restoration (FLR):
→ What:
 FLR is ongoing process of regaining ecological functionality and enhancing human well -being across
deforested or degraded forest landscapes. FLR is more than just planting trees – it is restoring whole
landscape to meet present and future needs and to offer multiple benefits and land uses over time.
 Forest landscape restoration is process of regaining ecological functionality and improving human
welfare across deforested or degraded forest landscapes. It seeks to involve - communities, champions,
government, vulnerable forest-dependent people and landowners in process of designing and
executing mutually advantageous interventions for up -gradation of landscapes. According to World
Resources Institute, forest ecosystems enrich soil fertility and water availabi lity, enhancing
agricultural productivity, and in turn rural economy.
→ Feature:
 FLR is about:
• Forests, because it involves increasing number and/or health of trees in area;
• Landscapes, because it involves entire watersheds, jurisdictions, or even countries in which many land uses
interact; and
• Restoration, because it involves bringing back biological productivity of area in order to achieve any number
of benefits for people and earth.
 Community Forest Resource (CFR):
→ What:
 Common forest land that has been traditionally protected and conserved for sustainable use by particular
community. That community uses it to access resources available within traditional and customary boundary of
village; and for seasonal use of landscape in case of pastoralist communities.
→ CFR Rights:
 What:
• CFR rights are recognised under Forest Rights Act, 2006 which says that forest rights of forest dwelling
Scheduled Tribes and other traditional forest dwellers on all forest lands include right to protect, regenerate
or conserve or manage any community forest resource which they have been traditionally protecting and
conserving for sustainable use.
• CFR rights allow community to formulate rules for forest use by itself and others and thereby discharge its
responsibilities under FRA, 2006.
 Significance:
• CFR rights, along with Community Rights (CRs) and rights over non-timber forest products, ensure
sustainable livelihoods of community.
• CFR rights give authority to Gram Sabha to adopt local traditional practices of forest conservation and
management within community forest resource boundary.
• CFR rights also underline integral role that forest dwellers play in sustainability of forests and in conservation
of biodiversity.
 Compensatory Afforestation (CA):
→ Afforestation, associated regeneration activities done to compensate for destroyed forest land diverted to
non-forest activities.
→ user agency pays for planting forests.
 Compensatory Afforestation Fund (CAF):
→ Environmental compensation (money) collected from industry, whi ch razed forest land for its business
plans.
 2020 Global Forest Resources Assessment:
→ released by UNFAO
→ Forest area has declined all across world. In past decades, world lost forest area of size of Libya.
→ But, rate of forest loss has declined [due to sustainable management].
→ Area of naturally regenerating forests has decreased.
→ Area of planted forests has increased.
→ Africa - largest annual rate of forest loss.
→ Asia - highest gain of forest area.
→ world’s total forest area is about 1/3 rd of total world’s land area.

Page 361 of 719

 → largest proportion of world’s forests are (descending order): tropical, boreal (taiga), temperate,
subtropical.
→ Max. forests area among countries (descending order): Russia, Brazil, Canada, US, China.
→ South America - highest plantation forests
→ Europe – lowest plantation forests.
 Minor Forest Produce (MFP):
→ What:
 Forest Rights Act (FRA), 2006 defines MFP as all Non-Timber Forest Produce (NTFP) of plant origin.
 MFP includes: Bamboo, Brushwood, Stumps, Canes, Cocoon, Honey, Waxes, Lac, Tendu / kendu leaves,
medicinal plants etc.
 Some MFPs are included in MSP Scheme.
 Ministry of Tribal Affairs
 Papum Reserve Forest:
→ major hornbill habitat in Arunachal Pradesh: Great hornbills, Wreathed hornbills, Oriental Pied hornbills.
 Reserved Forest vs Protected Forest:
→
{Reserved Forests} {Protected Forests}
Rights to all activities - hunting, grazing etc. are banned, Rights to activities – hunting, grazing etc. are sometimes
unless specific orders are issued. given to communities living on edges of forest, who
sustain their livelihood partially or wholly from forest
resources or products.
protection level > protected forests protection level < reserved forests
 Net Present Value (NPV) [forest]:
→ What:
 monetary approximation of value that is lost when piece of forest land is destroyed.
 It is based on services and ecological value.
 There exist prescribed formulae for calculating NPV amount which depends on location and nature of forest and
type of industrial enterprise that will replace lost forest.
 developed by committee led by Professor Kanchan Gupta, of Institute of Economic Growth, Delhi.
→ Introduction:
 To regulate forest diversions, Supreme Court introduced NPV charged on lands diverted.
 International Day of Forests [2021]:
→ 21st March
→ every year
→ organizers are UN Forum on Forests, UNFAO, in collaboration with Governments, Collaborative Partnership
on Forests (CPF), other relevant organizations in field.
→ established, and its date fixed, in 2012 by one UNGA resolution.
→ to celebrate and raise awareness of importance of all types of forests.
→ 2022 theme - “Forests and sustainable production and consumption”.
 India State of Forest Report (ISFR):
→ biennial report
→ assessment of India’s forest resources.
→ prepared by Forest Survey of India (FSI)
→ released by MoEFCC
→ 2021 India State of Forest Report (ISFR):
 Highlights:
• India’s forest and tree cover has risen in last 2 years, with Andhra Pradesh grows maximum increase in forest
cover.
• India’s total forest and tree cover is spread across about 80 million hectares [about 62% of geographical
area of India].
• Reason for gain in forest cover or improvement in forest canopy density: better conservation measures;
protection; afforestation activities; tree plantation drives; agroforestry.
• Among mega cities, Ahmedabad - biggest loser when it comes to forest cover.
• Forest cover:
 Top States in terms of increase in forest cover: AP, Telangana, Odisha, Karnataka, Jharkhand.
 Area-wise, MP - largest forest cover in India. [followed by Arunachal, Chhattisgarh, Odisha].
 Majority of States / UTs have > 33% of geographical their area under forest cover.
 Lakshadweep, Mizoram, AN Islands, Arunachal, Meghalaya – more than 75% forest cover.
• Mangrove cover:
 increase in mangrove cover in India.
 Total mangrove cover in India is about 5000 sq km.
Page 362 of 719
  Top States with increased mangrove cover – Odisha, Maharashtra, Karnataka.
• Carbon stock:
 increase in carbon stock of India.
 Total carbon stock in India’s forest is about 7,000 million tonnes.
 annual increase in carbon stock is about 40 million tonnes.
• Concerns:
 NE is not showing +ve results because forest cover decreased in NE region.
 Arunachal lost maximum forest cover, followed by Manipur, Nagaland, Mizoram, Meghalaya.
 In hill districts of India, forest cover reduced in last 2 years.
• Govt. efforts to increase forest cover in India:
 To achieve India’s aim of increasing additional carbon sink of about 3 billion tonnes CO2 equivalent by
2030, Nagar Van Yojna was introduced to increase tree cover.
 Green Mission / National Mission for Green India (GIM).
 Features of 2021 ISFR:
• FSI included new chapter related to assessment of forest cover in Tiger Reserves, Corridors, Lion
conservation area of India.
• New chapter included, where ‘Above Ground Biomass’ is estimated. [FSI, in collaboration with Space
Application Centre (SAC) (ISRO, Ahmedabad), studied estimation of Above Ground Biomass (AGB) at pan-
India level, using L- band of Synthetic Aperture Radar (SAR) data].
• FSI in collaboration with Birla Institute of Technology & Science (BITS) Pilani, Goa performed study based on
‘Mapping of Climate Change Hotspots in Indian Forests’, so as to map climatic hotspots over forest cover in
India, using computer model-based projection of temperature and rainfall data.
• Contains separate information on State/ UT wise, special thematic information on forest cover - hill, tribal
districts, NE region.
 World Forestry Congress (WFC) [1926]:
→ What:
 largest and most significant gathering of world's forestry sector.
 It is forum for sharing of knowledge and experience regarding conservation, management and use of
world's forests, and covers such issues as international dialogue, socio -economic and institutional
aspects, and forest policies.
 forum for exchange of views and experiences on all aspects of forests and forestry, which may lead to
formulation of broad recommendations applicable at national, regional and global levels.
→ Aim:
 To contribute to orient / shape international action in silvicultural (forestry) aspects and stimulate global
competency and reflection that can inform development of global forestry sector.
→ Feature:
 It has been held every 6 years since 1926 under UNFAO, organized by government of host country.
 responsibility for organization and financing of each Congress lies with host country.
 WFC is not intergovernmental meeting; it has no formal constituencies nor country delegations.
→ 15 th World Forestry Congress [2022]:
 held in Seoul, South Korea
 at this 15th World Forestry Congress, participant 160 countries declared Seoul Forest Declaration [2022].
 At this 15 th World Forestry Congress, below new partnerships were launched:
• Assuring Future of Forests with Integrated Risk Management (AFFIRM) Mechanism.
• Sustaining Abundance of Forest Ecosystems (SAFE) initiative.
 2 nd WFC held in Asia, with Indonesia hosting 1 st WFC in Asia in 1978.
→ Seoul Forest Declaration [2022]:
 Declaration that asserts that forests, forestry and forest stakeholders offer major nat ure-based solutions
to climate change, biodiversity loss, land degradation, hunger and poverty, but we need to act now –
there is no time to lose.
 This declaration also conveys some urgent messages to encourage actions for green, healthy and resilient
future with forests, as contribution to SDGs, UN Decade on Ecosystem Restoration, Post -2020 Global
Biodiversity Framework and green recovery from COVID-19 pandemic.
 It identifies priority areas with potential to lead to green, healthy and resilient future.
 It urges that responsibility for forests should be shared and integrated across institutions, sectors and
stakeholders.
 It urges for investment in forest and landscape restoration globally needs to triple by 2030.
 It urges for move towards circular bioeconomy and climate neutrality.
 Forest (Conservation) Rules:

Page 363 of 719

 → Forest Conservation Rules deal with implementation of FCA, 1980. They prescribe procedure to be followed
for forest land to be diverted for non-forestry uses such as road construction, highway development,
railway lines, mining.
→ Forest (Conservation) Rules, 2022:
 In 2022, MoEFCC notified Forest (Conservation) Rules, 2022 under Forest (Conservation) Act, 1980 and
in supersession of Forest (Conservation) Rules, 2003.
 Objective:
• To protect forests and wildlife. Increase the area under forests. Dissuade State governments’
attempts to divert forest land for commercial projects.
 Feature:
• Central government permission: For forest land beyond 5 hectares, States must ask for approval
for diverting land from Central government. This is via one specially constituted committee, called
Forest Advisory Committee (FAC). FAC scrutinises project and ensures that - felling of trees and
denuding of local landscape — will be minimal and said piece of land doesn’t cause damage to
wildlife habitat.
• States to ensure rights under FRA, 2006: Once FAC is convinced and approves (or rejects proposal),
it is forwarded to concerned State government where land is located, which then has to ensure
that provisions of FRA, 2006, one separate Act that protects rights of forest dwellers and tribals
over their land, are complied with.
• Compensation: FAC approval also means that future users of land must provide compensatory land
for afforestation as well as pay Net Present Value (NPV) (ranging between Rs 10 -15 lakh per
hectare.)
• Allows Private plantations: 2022 Rules have one provision for private parties to cultivate
plantations and sell them as land to companies who need to meet compensatory forestation
targets.
• No mention of tribals and forest-dwelling communities whose land would be taken for
developmental work.
• No consent of Gram Sabha needed: 2022 rules says that project, once approved by FAC, wil l then
be passed on to State authorities who will collect compensatory fund and land, and process it for
final approval.
• No approval is needed for Strategic Projects e.g. strategic and security projects of national
importance.
• Allows building in Forests: Right to construct structures for bonafide purposes including forest
protection measures and residential units (up to area of 250 sq meters as one -time relaxation).
 Concern:
• This 2022 rules allow forest land to be diverted to industry without settling ques tions about rights
of forest dwellers and tribals who resided on those lands.
• In 2022, NCST recommended to Forest Ministry to put Forest (Conservation) Rules, 2022 on hold.
Harsh Chouhan, the Chairperson of NCST gave the reason that 2022 rules had the pote ntial to
affect the well-being and rights of tribal people. NCST said the 2022 rules essentially eliminated
the requirement of consent of local tribespeople and forest dwellers for diversion of forest land
for other purposes. This amounted to infringing up on the land rights of tribespeople under Forest
Rights Act, 2006. [This was an argument the Opposition Congress had been making since 2022
rules were issued].
 Hariyali Mahotsav (Tree Festival) [2022]:
→ What:
 It was celebrated in New Delhi for celebrating tree plantation and commemorating 75 years of Independence as
‘Azadi ka Amrit Mahotsav’ and for undertaking plantation drives and awareness generation to protect
environment.
 This Mahotsav is being organized to create awareness about importance of trees and green cover to protect our
environment against air pollution and global warming.
 Van Mahotsav (Celebrate forest):
 History of Van Mahotsav Day goes back to 1947, when it was 1st organised by Punjabi botanist, M.S. Randhawa.
It is one pan-India tree planting festival celebrated in July every year.
 Forest Fire / Wildfire / Bushfire / Wildland fire / Rural fire:
→ What:
 It is one unplanned, uncontrolled and unpredictable fire in area of combustible vegetation starting in rural and
urban areas. Some forest ecosystems in their natural state depend on wildfire. Depending on type of vegetation
present, wildfire can also be classified more specifically as bushfire (in Australia), desert fire, grass fire, hill fire,
peat fire, prairie fire, vegetation fire, or veld fire. Wildfires are distinct from beneficial uses of fire, called
controlled burns, though controlled burns can turn into wildfires.

Page 364 of 719

  Wildfire / Forest Fire is one major fire that breaks out unpredictably in combustible environments such as dry
forests or bush and often burns uncontrollably over large area and length of time. Forest fire can be triggered
by natural factors such as prolonged hot, dry weather or lightning strikes, or human carelessness.
→ Cause:
 Man-made / anthropogenic (almost all forest fires):
• Small fire left by herdsman, Minor Forest Produce (MFP) gatherer etc. after cooking food etc; Stubble
burning etc. in paddy fields can spread fire to adjoining forest; Shifting cultivation; Grazing; Flame; Cigarette;
Electric spark; Any source of ignition.
• Intentional fires:
 Economic reasons: E.g. Human-caused fires are also one major issue in Indonesia, where large areas of
peatland were burned during 2021’s fires to be converted into tree plantations. In Pantanal (South
America): Soy and cattle farmers set fires on their land during summer, but drought and strong winds
caused these fires to rage out of control and surpass traditional barriers such as roads, streams;
 Graziers and gatherers start small fires to get good grazing grass for their cattle and to gathering MFP
such as Madhuca Indica flowers and leaves of Diospyros elanoxylon;
 Shifting cultivation practice: NE region of India and in parts of Orissa, AP;
 Forest fires by villagers to ward off wild animals.
• Unintentional fires: Logging activity-related fires, campfires in forests for recreation, E.g. through discards
cigarette butts.
 Natural:
• Lightning. Lack of soil moisture. Rubbing of dry bamboos etc. with each other. Dry leaves falling on electric
pole. Rainfall deficiency (weak monsoon in India). High atmospheric temperatures. Low humidity. High wind
speed. Extreme climatic conditions: Eg. high wind speed and direction, temperature, low level of moisture
in soil and atmosphere, and duration of dry spells. Lightning strike: Eg. in Australia, most bushfires are
caused by lightning. Friction of bamboos swaying due to high wind velocity: E.g. in deciduous forests of NE
India that result in sparks, in mountainous forested of Uttrakhand, etc. El Nino and La Nina: Eg. Indonesian
in 2019 experienced high forest fire incidents due to El Nino’s impact. Sudden stratospheric warming in
Antarctica: 2020 bush fires in Australia was further strengthened by it.
• Climate change: It is increasing fire season and size of areas affected by fire. Droughts, which might be
exacerbated by climate change, also make wildfires more likely. Eg. Australia has been experiencing such
drought over past few years, which contributed to widespread of wildfires in 2020. Climate change is
changing nature and intensity of fires: There are more pyro-cumulonimbus clouds – clouds formed on top
of heat sources – that can bring lightning-intensive storms and increase spread of fire. In Siberia and Russia,
climate change is causing winters to become shorter and weather to become drier and windier, leading to
more intense fires occurring across larger areas.
→ How Climate change fuels wildfires?
 Temperature rises; Snow melts sooner; Forests are drier, and thus make ecosystems prime for wildfires to ignite
and spread; Fires are getting worse and larger and costlier than ever before, and their emissions worsening
global warming.
→ Status:
 As per Global Forest Watch, forest fires in India have increased by 125% (between 2015 and 2017). At global
level as well, world is undergoing through wildfire crisis, with reports of wildfires in Siberia, Amazon basin,
Pantanal wetland (South America), Australia, rainforest of Indonesia.
 Major forest fire incidents:
• California: It is due to high heat and dry conditions.
• Europe: Fire incidents in France, Romania, Greece, Italy.
• Siberia: It is due to climate change.
• Amazon basin and Pantanal: It is due to deliberate fires to turn forest to agriculture.
• India: Himalayan regions and dry deciduous forests of India – AP, Assam, Chhattisgarh are most affected by
forest fires.
• Australia: Majority forest fires are due to lightning.
→ Concerns:
 Forest fires have become issue of global concern.
• In many countries, USA, Brazil (Amazon) etc, wildfires are burning larger areas and fire seasons are getting
longer due to global warming.
• Globally, forest fires release billions of tons of CO2 into atmosphere -> increase global warming.
• Globally, many people have died due to illnesses caused by exposure to smoke from forest fires, other
landscape fires.
 Forest fires are difficult to control:
• forest located in inaccessible location (mobilisation of firefighting equipment etc.)
• lack of firefighting manpower

Page 365 of 719

 • fire usaully spreads in wind directions and towards higher elevations.
→ Prevention / Control:
 Monitor forest fire in real time using satellite data. Meteorological forecasting of fire-prone days. Clearing
camping areas of dried biomass. Early preventive burning of dry litter. Growing of fire-hardy plants in forest.
Creating fire lines in forest: Fire lines which are strips of land without vegetation to prevent fire from spreading.
Govt. rules and regulations with proper enforcement. Help and collaboration with local people. Civil societies,
NGOs etc.
 Policy measures.
 Community participation: By involvement of NGOs, Voluntary Organisations, Village Forest Committees (VFCs),
etc.
 Institutionalize partnership with forest fringe communities.
 Devise forest fire forecasting system at local level.
 Forest Fire Monitoring: Forest Survey of India (FSI) uses NASA’s Moderate Resolution Imaging Spectro-
radiometer (MODIS) and Visible Infrared Imaging Radiometer Suite (VIIRS) satellites for its forest fires alert
system 2.0.
 Use of technology (such as Remote Sensing, GPS, GIS) in planning, developing and operationalizing fire
management systems.
→ India:
 Traditionally, Indian forests have been affected by wildfires. Places prone to forest fires are Himachal,
Uttarakhand, Assam, Madhya Pradesh, Maharashtra, Tripura, Mizoram, Odisha.
 April-May (Pre-monsoon) is when forest fires usually take place in India.
 According to Forest Survey of India, nearly 36% of India’s forests are prone to frequent fires.
 According to India State of Forest Report (ISFR), forest fire prone classification Less (max. % of all forests in India);
Moderate; High; Very high; Extreme (min. % of all forests in India).
 Problem has been intensified with: rising human population; rising cattle population; rising demand for grazing;
rising demand for shifting cultivation; rising demand for forest products.
 Initiative:
• Forest Fire Alert System, 2004.
• Forest Fire Prevention & Management Scheme (FPM) [2017]: This GOI’s scheme takes care of forest fire
prevention and management measures.
• National Action Plan on Forest Fire (NAPFF), 2018.
 Vulnerable of Uttarakhand, Himachal Pradesh to forest Fires:
• Except for periods of precipitation in monsoon and winter, their forests remain vulnerable to wildfires.
• In summer season, forest fires occur frequently in their low and middle hills, where forests of Chir Pine are
common.
• During post-monsoon season and in winters, forest fires are also reported in higher areas, including parts
of Shimla, where they usually occur in grasslands.
→ Note:
 Forest Fire Alert System, 2004:
• In 2004, Forest Survey of India (FSI) developed Forest Fire Alert System to monitor forest fire in real time,
by using ISRO’s satellite data.
 Forest fire Prevention and Management scheme (FPM):
• only centrally funded program specifically dedicated to assisting States in dealing with forest fires.
 National Action Plan on Forest Fires (NAPFF), 2018:
• What:
 Plan to minimise forest fires by informing, enabling and empowering forest fringe communities and
incentivising them to work with State Forest Departments.
• Aim:
 to minimise forest fires
• How:
 by informing, enabling and empowering forest border communities
 by incentivising forest border communities to work with State Forest Departments.
• Feature:
 This 2018 NAPFF mentions for promoting greater adoption of Forest Fire Alert System: FSI has put in
place robust forest fire alert system. States shall encourage involvement of all field functionaries in
same, so that forest fire alert system can percolate down to beat level in least possible time. This may
be institutionalized through protocol.
 It also says IT Cells of State forest departments shall conduct inventory mapping of critical resources for
forest fire prevention and management and make relevant information available to forest divisions.
 FSI report on forest fires in India, 2021:
• Odisha:
Page 366 of 719
  highest forest fires in India.
 Reasons: Forest produce collection – like collection of mahua flowers, kendu leaves; shifting cultivation;
grazing in forest areas.
Value Addition:
 New York Declaration on Forests [2014]:
→ One voluntary and non-legally binding political declaration which grew out of dialogue among
governments, companies and civil society, spurred by UN Secretary -General’s Climate Summit held in New
York in 2014. This Declaration pledges to halve rate of deforestation by 2020, to end it by 2030, and to
restore hundreds of millions of acres of degraded land.
 Clonal Forestry:
→ large-scale deployment of superior clones of trees / forest that have proven thei r superiority in clonal
tests. i.e. deployment of tested clones.
→ It is usage of vegetative propagation method for large scale propagation of identified and tested clones of
trees / forest with valuable properties.
Question:
 ‘New York Declaration on Forests’ was 1st endorsed at UN Climate Summit in 2014. It endorses global timeline to end loss
of forests. It is non-legally binding international declaration. It is endorsed by governments, big companies and indigenous
communities.
 As per Central Ground Water Authority (CGWA), 71% of area for groundwater is under ‘Safe’ category, 10% is semi-
critical, 4% is critical and 15% is over-exploited. CGWA was formed under Environment Protection Act, 1986. India has
largest area under groundwater irrigation in world.
Mains Link:
 Forest restoration is one of the key elements of climate mitigation strategies. In this context, examine the
measures taken in restoring the degraded forest landscape in India. (250 words)
 Any amendment to the Forest Conservation Act, 1980, must be guided by proper and intensive consultation with
stakeholders, with constitutionally and legally bound procedures and limitations. Discuss. (250M)
 Enumerate the causes for the rising instances of forest fires in India. What measures are needed to mitigate the adverse
impacts of forest fires? (250 Words)

PORT
News:
 2022:
→ Jawaharlal Nehru Port (JNP) becomes 1st major 100% landlord port in India, having all berths being operated on PPP
model.
→ GOI circulates draft Indian Ports Bill, 2022 for wider / stakeholder consultation.
→ Draft Indian Ports Bill, 2022 has not resolved main issue between Centre and maritime States.
About:
 Status:
→ There are 13 major ports and over 200 non-major and minor ports in India. Up to 100% FDI is allowed under
automatic route for port and harbour construction and maintenance projects. JNP trust becomes 1 st major 100%
landlord port in India, having all berths being operated on PPP model. India’ latest port is Vadhavan Port (MH).
→ Indian ports have already reached their saturation and India needs more new ports.
→ Between 1993-94 and 2021-22, share of total cargo of non-major ports went up from 8% to 45%.
→ Public-Private Partnership (PPP): Maritime States developed non-major ports almost entirely on PPP basis. Example
– Gujarat’s Pipavav port (India’s 1st private port at Pipavav).
→ One report - ‘Regulation of Indian Port Sector’ - published in 2011 observed that non-major ports in India are
perceived as more business-oriented, customer friendly, cheaper and in general more efficient.
→ Unnecessary regulatory and financial burdens are imposed upon Port Trusts, private terminal operators and
investors” by the Central government.
 Law:
→ Major Ports are under Union list (owned and managed by Central government through one board of trustees) while
non-major ports are in Concurrent List and come under respective State governments, but Centre has overriding
legislative and executive powers.
 Major ports:
→ Currently, India has 12 major ports – Deendayal (erstwhile Kandla), Mumbai, JNPT, Mormugao, New Mangalore,
Cochin, Chennai, Kamarajar (earlier Ennore), VO Chidambaranar, Visakhapatnam, Paradip, Kolkata (including Haldia).
 Models of Port ownership:
→ Landlord Port Model:
 In this model, publicly governed port authority (govt. owned) acts as regulatory body and as landlord while
private companies carry out all other port operations. In return, landlord gets share of revenue from that private
entity. Previously, GOI proposed to set up one major port at Vadhavan (India’s 13th major port) near Dahanu in
MH based on landlord model.
Page 367 of 719
 → Service Port:
 Port authority owns land and all available assets and carry out all operations themselves.
→ Corporatized Port:
 Port is entirely privatized, except ownership remains public. Eg. Mundra Port.
 Issues:
→ India doesn’t have deep port with sufficient draft for larger container vessels. India’s eastern coast doesn’t have good
harbor. Dependency on Sri Lanka and Singapore for transshipment and saturated major ports.
 Initiative:
→ Sagarmala Programme / Sagarmala project / Sagar Mala [2015]. Project UNNATI.
 Significance:
→ India has over 7500 Km long coastline. About 95% of India’s trade by volume (and 65% trade by value) is done through
maritime transport.
 Way Forward:
→ Reforms in port sector need to be supplemented by scientific and consultative planning, with keen focus on ever-
increasing safety, security and environmental issues.
Note:
 Project UNNATI:
→ It seeks to enhance operational and financial performance of major ports.
 Sagarmala Programme / Sagarmala project / Sagar Mala [2015]:
→ What:
 Sagarmala programme is flagship programme of Ministry of Shipping to promote port-led development in India
through harnessing India’s 7,500 km long coastline, 14,500 km of potentially navigable waterways and strategic
location on key international maritime trade routes. garland of sea. initiative by government of India to enhance
performance of India's logistics sector. flagship programme of Ministry of Shipping. It involves investing billions
of dollars to set up infrastructure. under Ministry of Ports, Shipping and Waterways. To promote “Port-led
development” along India’s 7500 km long coastline by developing Coastal Economic Zones (CEZ).
→ Objective:
 To reduce logistics cost for EXIM and domestic trade with minimal infrastructure investment.
 To promote industrial port-led development in India.
 unlocking potential of waterways and coastline to minimize infrastructural investments required to meet these
targets.
 to promote port-led development in India by exploiting India's 7,517 km long coastline, 14,500 km of potentially
navigable waterways and its strategic location on key international maritime trade routes.
→ Feature:
 Set up new mega ports
 modernizing India's existing ports
 developing Coastal Economic Zones (CEZs) and Coastal Economic Units
 enhancing port connectivity via road, rail, multi-modal logistics parks, pipelines & waterways
 promoting coastal community development
 boosting merchandise exports by US 110 billion and generating around 10 million direct and indirect jobs.
→ National Sagarmala Apex Committee (NSAC):
 It is composed of Minister of Shipping, Cabinet Ministers from stakeholder ministries, ministers in charge of
ports in India’s maritime States.
→ Status:
 More than 800 projects at estimated cost of around Rs. 5.48 lakh crore are identified for implementation.
 6 megaports are planned in Sagarmala project: Sagar Island (West Bengal), Paradip Outer Harbour (Odisha),
Sirkazhi (Tamil Nadu), Kanyakumari (Tamil Nadu), Belikeri (Karnataka), Vadhavan (Maharashtra).
→ Need:
 Indian ports play primary contributing role in Indian economy. In fact, around 95% of merchandise trade passes
through Indian seaports. However, Indian ports still lag in multiple arenas when compared to international ports.
So, to finally do away with all issues and develop it even further, Ministry of Shipping decided to start new
program – Sagarmala Project.
→ Significance:
 contribute to India's growth.
 transforming existing Ports into modern world-class Ports and integrate development of Ports, Industrial clusters
and hinterland
 efficient evacuation systems through road, rail, inland and coastal waterways resulting in Ports becoming drivers
of economic activity in coastal areas.
 Land Ports Authority of India (LPAI) [2012]:
→ Statutory body established under Land Ports Authority of India Act, 2010
→ Function: cross-border movement of passengers and goods at ports along international borders of India.
Page 368 of 719
  Jawaharlal Nehru Port Trust (JNPT) / JLN Port / Nhava Sheva Port:
→ It is 2 nd largest container port in India after Mundra Port. Located in Navi Mumbai's Raigad district, this
port on Arabian Sea is accessed via Thane Creek. It is one nodal city of Navi Mumbai. Its common name
derives from names of Nhava and Sheva villages that are situated here. This port is also terminal of Western
Dedicated Freight Corridor. JNP is one of leading container ports in India and is ranked about 26th among
top 100 global ports. JNPCT is presently handling 9000 TEUs capacity vessels (Twenty -foot Equivalent Unit)
and with up-gradation, it can handle 12200 TEUs capacity vessels.
 Indian Ports Bill, 2022 [draft]:
→ What:
 It seeks to repeal and replace existing Indian Ports Act, 1908, which is more than 110 years old.
→ Objective:
 Ensuring coordination between States and centres; prevent pollution; address issues with dispute
resolution systems; use data for development of port.
→ Need:
 Indian ports are governed by Indian Ports Act, 1908 (which is more than 110 years old) and Major Port
Trusts Act, 1963. Also, India’s ports are falling behind its Asian competitors (Sri Lanka, Singapore) in
terms of cargo handled and infrastructure facilities.
→ Feature:
 Environmental compliance: This bill will ensure prevention and containment of pollution at ports, by
complying with maritime treaties and international instruments to which India is party. India has
signed International Convention for Prevention of Pollution from Ships, 1973, also known as MARPOL.
 Institutional changes proposed by this Bill:
• Empower and establish State Maritime Boards and State Maritimes Development Council for effective
administration, control and management of non-major ports in India.
• Provide adjudicatory mechanisms for redressal of port-related disputes.
• Establish one national council for fostering structured growth and development of port sector.
• Constitution of maritime State Development Fund.
→ Benefit:
 It will ensure optimum utilisation of coastline of India, address logistics bottlenecks and help India emerge as
major trading hub.
→ Issue:
 It has retained Maritime State Development Council (MSDC) as statutory-cum-permanent body.
 It authorizes Central government to entrust any administrative and financial functions to MSDC.
 Center’s favour: Composition of MSDC is in favour of Centre as it has 5 Secretaries and 1 Joint Secretary to GOI
and Administrators of coastal UTs, as members.
Question:
 Cardamom Hills - Malabar coast (Kerala). Kaimur Range - Central India. Mahadeo Hills - Central India (MP). Konkan coast
- estern ghat. Mikir Hills – NE India (Assam). Coromandel Coast - South india at Eastern ghat.
Mains Link:
 Discuss the prospects for ports in India. What are the issues and challenges with Indian Ports? Examine. (250 Words)

GENOME
News:
 2021:
→ California researchers developed pgSIT [CRISPR-based system] to safely restrain mosquito vectors via
sterilization.
→ INSACOG traces about 100 mutations of SARS-Cov-2, including 4 novel mutations in India.
 2022:
→ Scientists reports 1st end-to-end human genome sequence i.e. complete human genome sequencing has been done.
Nearly 2 decades ago, when scientists published map of human genome for 1 st time, about 8% of human DNA was
left unsequenced. Now in year 2022, this has been completed and thus giving picture of human genome for 1st time.
 Importance:
• Complete human genome makes it easier to study genetic variation between individuals or between
populations.
 What was missing?
• Genetic sequence made available in 2003 from Human Genome Project contained information from one
region of human genome called euchromatin. But, 8% of that was left out in area called heterochromatin.
Reasons were because heterochromatin was given lower priority. This part of genome was thought to be
“junk DNA”, because it had no clear function, and euchromatin contained more genes that were simpler to
sequence with tools available at that time.

Page 369 of 719

 • Now, fully sequenced genome is result of efforts of global collaboration called Telomere-to-Telomere (T2T)
project. Invention of new methods of DNA sequencing and computational analysis helped complete reading
of remaining 8% of human genome.
→ 10 years back in 2012, Jennifer Doudna and Emmanuelle Charpentier published their finding that CRISPR-Cas9 could
be programmed with RNA to edit genomic DNA, now considered one of most significant discoveries in history of
biology.
→ WHO Science Council of experts issues its 1st report, on accelerating access to genomics for global health. This report
argues that it is not justifiable ethically or scientifically for less-resourced countries to gain access to such
technologies long after rich countries do. This report calls for equitable expansion of genomics.
→ CRISPR has reached 1 decade of development in year 2022.
→ Over last 3 years, gene-editing technology with nearly unlimited potential has produced flawless results in clinical
trials. India has approved one 5-year project to develop CRISPR to cure sickle cell anaemia.
About:
 What:
→ organism’s complete set of DNA, including all of its genes.
→ In fields of molecular biology and genetics, genome is all genetic information of organism. It consists of nucleotide
sequences of DNA (or RNA in RNA viruses). Nuclear genome includes protein-coding genes and non-coding genes,
other functional regions of genome, and any junk DNA if it is present.
→ Human genome has about 3.2 billion base pairs.
→ Genome is complete set of genetic information in organism. Genome is stored in long molecules of DNA called
chromosomes.
 Example:
→ Algae and plants contain chloroplasts with one chloroplast genome.
→ Almost all eukaryotes have mitochondria and one mitochondrial genome.
 Genomics:
→ Study of genome. It is interdisciplinary field of biology focusing on structure, function, evolution, mapping, editing of
genomes.
→ Genomics is study of complete set of DNA (including all of its genes) in person or other organism. Genome is
organism’s complete set of DNA.
→ Genomes of many organisms have been sequenced. In 2004, international Human Genome Project [1990-2003]
reported sequence of genome for Homo sapiens, although initial "finished" sequence was missing 8% of genome
consisting mostly of repetitive sequences. With advancements in technology that could handle sequencing of many
repetitive sequences found in human DNA that were not fully uncovered by this original Human Genome Project
study, scientists reported 1st end-to-end human genome sequence in 2022.
 Initiative:
→ WHO’s 10-year strategy for genomic surveillance of pathogens.
→ India:
 Genome India [2020].
 IndiGen Genome project / Program.
 INSACOG [2020].
 Way Forward:
→ It is important to ensure that India, with its unparalleled human diversity, is adequately represented in terms of
genomic data and develops indigenous capacity to generate, maintain, analyse, utilize, communicate large-scale
genome data.
Note:
 Genome editing / Genome engineering / Gene editing:
→ What:
 Type of genetic engineering in which DNA is inserted, deleted, modified, or replaced in genome of living
organism. Unlike early genetic engineering techniques that randomly inserts genetic material into host genome,
genome editing targets insertions to site specific locations.
Genome editing (also called gene editing) technologies allow genetic material to be added, removed,
or altered at particular locations in genome. Several approaches to genome editing have been developed.
→ Feature:
 Genome editing involves use of technologies that allow genetic material to be added, removed, or altered at
particular locations in genome. Several approaches to genome editing are developed. One well-known is called
CRISPR-Cas9, which is short for Clustered Regularly Interspaced Short Palindromic Repeats and CRISPR-
associated protein 9.
→ Potential applications of genome editing technologies:
 Better understanding of diseases: Most uses of genome editing have been in scientific research – for example,
to investigate models of human disease. Several therapeutic interventions using CRISPR for diseases like

Page 370 of 719

 thalassaemia or sickle cell anaemia have gone into clinical trials. This will avoid most of avoidable deaths in (e.g.,
due to cancer) in poor countries.
 Identifying threats: Genome editing has been used to develop suite of tools that scientists can use to better
understand new and existing pathogens. This can help to develop and poor countries are prepared for incoming
threats of diseases.
 Developing new treatments: Potential of genome editing to impact development and use of new treatments is
tremendous. Genome-editing technologies have major advantage over traditional drugs in that they can target
genetic basis of disease. This can drastically lower cost of life-threatening diseases.
 Treating genetic diseases: It has huge potential in field of genetic diseases. Poor countries like Nigeria, Sudan
and tribals in India have witnessed rise in cases of diseases like Sickle cell anaemia, thalassemia etc.
 Other potential uses: Genome-editing technologies also have number of relevant applications to global health
security outside of human body. Gene drive has potential to control vectors and minimize possibility of certain
outbreaks whose impact is felt by poor countries more. It can help either by eliminating vector entirely or by
editing vector’s genome to remove its ability to carry particular agent.
→ Issue:
 Ethical dilemma:
• Designer Baby: In 2018, Chinese researcher disclosed that he had altered genes of human embryo to prevent
infection of HIV. This was 1st documented case of creating ‘designer baby’, and it caused widespread concern
in scientific community.
• Changes in embryo pass on to generations: It may thus create community of superhumans. In case of
therapeutic interventions, changes in genetic sequences remain with individual and are not passed on to
offspring.
→ Initiative:
 In 2021 India approved one 5-year project to develop CRISPR technology to cure sickle cell anaemia which mainly
afflicts tribal populations of India.
→ Fact:
 Other Genome editing systems are Transcription Activator-Like Effector Nucleases (TALENs), Zinc-Finger
Nucleases (ZFNs) etc.
 Genome Sequencing / Genome project:
→ What:
 technique that allows us to read and interpret genetic information found within DNA or RNA.
 process that involves deciphering exact order of base pairs in individual. This “deciphering” or reading of genome
is what sequencing is all about. Costs of sequencing differ based on methods employed to do reading or accuracy
stressed upon in decoding genome.
 scientific endeavours to determine complete genome sequence of organism (be it animal, plant, fungus,
bacterium, virus) and to explain protein-coding genes and other important genome-encoded features.
→ Example:
 Genome (SARS-CoV2 genome etc) has many base pairs (nucleotides). This long string, with its unique
combination of nucleotides, is what uniquely identifies virus and is called its genomic sequence.
 Genome sequence of organism includes collective DNA sequences of each chromosome in that organism. For
bacterium containing single chromosome, genome project will aim to map sequence of that chromosome. For
human species, whose genome includes 22 pairs of autosomes and 2 sex chromosomes, complete genome
sequence will involve 46 separate chromosome sequences. Human genome has about 3.2 billion base pairs.
→ Need:
 Ever since human genome was 1st sequenced in 2003, it opened fresh perspective on link between disease and
unique genetic make-up of each individual.
 Nearly 10,000 diseases — cystic fibrosis, thalassemia, etc — are known to be result of one single gene
malfunctioning.
 While genes may give some insensitive to certain drugs, genome sequencing has shown that cancer too can be
understood from viewpoint of genetics, rather than being seen as disease of certain organs.
→ Significance:
 Genome sequencing is one laboratory method that is used to determine entire genetic makeup of one specific
organism or cell type. This method can be used to find changes in areas of genome. These changes may help
scientists understand how specific diseases (such as cancer) form as well as modify genetic makeup of crops as
per our needs.
 Some genes’ linkage to certain diseases. Nearly 10,000 diseases — cystic fibrosis, thalassemia, etc — are known
to be result of one single gene malfunctioning.
 Ever since human genome was 1st sequenced in 2003, it opened fresh perspective on link between disease and
unique genetic make-up of each individual.
 While genes may give some insensitive to certain drugs, genome sequencing has shown that cancer too can be
understood from viewpoint of genetics, rather than being seen as disease of certain organs.

Page 371 of 719

  Ability to decode genetic blueprint of humans through whole genome sequencing will be major driver for
biomedical science.
 Genome sequences from patient samples help researchers to understand how virus is evolving as it spreads.
 Genome sequence helps track transmission route of virus globally.
 Genome sequence determines how quickly virus is adapting as it spreads.
 Genome sequence helps how to do therapy.
 Genome sequence helps understand role of co-infection.
 Surveillance – Sequencing helps to get true picture of prevailing variants, emerging variants, and those causing
reinfection.
 Mapping diversity of India’s genetic pool may be bedrock of personalised medicine. It may be possible to take
action before onset of disease.
→ Whole genome sequencing (WGS) / full genome sequencing / complete genome sequencing / entire genome
sequencing:
 process of determining entirety, or nearly entirety, of DNA sequence of one organism's genome at one single
time.
 This involves sequencing all of that organism's chromosomal DNA as well as DNA contained in mitochondria and,
for plants, in chloroplast.
→ India:
 Centre for Scientific and Industrial Research (CSIR) have done whole genome sequencing of novel coronavirus.
 IndiGen Genome project [2019].
 Genome India [2020].
 Indian SARS-CoV-2 Consortium on Genomics (INSACOG) [2020].
 Clustered Regularly Interspaced Short Palindromic Repeats (CRISPR):
→ What:
 It is one family of DNA sequences found in genomes of prokaryotic organisms such as bacteria, archaea. These
sequences are derived from DNA fragments of bacteriophages that had previously infected prokaryote. They are
used to detect and destroy DNA from similar bacteriophages during subsequent infections. Hence these
sequences play key role in antiviral (i.e. anti-phage) defense system of prokaryotes and provide one form of
acquired immunity. CRISPR are found in approximately 50% of sequenced bacterial genomes and nearly 90% of
sequenced archaea.
Cas9 (CRISPR-associated protein 9) is one enzyme that uses CRISPR sequences as guide to recognize
and split specific strands of DNA that are complementary to CRISPR sequence. Cas9 enzymes together with
CRISPR sequences form basis of one technology known as CRISPR-Cas9 that can be used to edit genes within
organisms. This editing process has wide variety of applications including basic biological research, development
of biotechnological products, and treatment of diseases. Development of CRISPR-Cas9 genome editing
technique was recognized by Nobel Prize in Chemistry in 2020 which was awarded to Emmanuelle Charpentier
and Jennifer Doudna.
→ Mechanism:
 Its mechanism is often compared to ‘cut-copy-paste’, or ‘find-replace’ functionalities in common computer
programmes. One bad stretch in DNA sequence, which is cause of disease or disorder, is located, cut, and
removed — and then replaced with ‘correct’ sequence.
 CRISPR gene editing:
→ What:
 CRISPR gene editing is one genetic engineering technique in molecular biology by which genomes of living
organisms may be modified. It is based on simplified version of bacterial CRISPR-Cas9 antiviral defense system.
By delivering Cas9 nuclease complexed with one synthetic guide RNA (gRNA) into cell, cell's genome can be cut
at desired location, allowing existing genes to be removed and / or new ones added in vivo. Enzyme Cas9 acts
as pair of molecular scissor.
 It is one gene editing technology [altering genetic expression or changing genome of organism]. It can detect
specific sequences of DNA within gene [by using enzyme that functions as molecular scissor to snip it].
→ Aim:
 Alter DNA sequences and modify gene function.
 detection of pathogens in future.
→ Usage:
 correcting genetic defects
 preventing and treating diseases.
→ Working mechanism:
 Overview:
• It works on cut-and-paste mechanism. CRISPR locates / identifies specific/problematic area in genetic
sequence. CRISPR cuts it out. CRISPR replaces it with new and correct sequence that no longer causes that
problem.

Page 372 of 719

  Detail:
• One RNA molecule is programmed to locate particular problematic sequence on DNA strand
• Special protein called Cas9 (genetic scissor protein) is used to break and remove problematic sequence.
 When:
• DNA strand, when broken, has natural tendency to repair itself. But, this auto-repair mechanism can lead
to re-growth of that problematic sequence. Scientists intervene during this auto-repair process by supplying
desired sequence of genetic codes, which replaces that original sequence.
→ Example:
 2018 Designer Babies:
• In 2018, one Chinese researcher claimed that he had altered genes of human embryo that eventually
resulted in birth of twin baby girls.
• This was 1st documented case of ‘designer babies’ being produced using new gene-editing tools like CRISPR.
• This raised ethical concerns.
• Genes were edited to ensure that they do not get infected with HIV. This special trait would then be
inherited by their subsequent generations as well.
→ Arguments:

{for} {against}
CRISPR technology is simple yet powerful tool for Ethical concerns:
editing genomes. a. It is unethical to produce gene altered
babies [with particular genetic traits
etc.].
b. CRISPR technology is not 100% accurate.
Thus, it is possible that mistake in genes
alteration may happen.
allows researchers to easily alter DNA sequences and Studies highlighted that CRISPR-Cas9 edited cells may
modify gene function trigger cancer.
correcting genetic defects It may increase risk of mutations elsewhere in
genome in edited cells.
treating and preventing spread of diseases Many things are not clear like how we should
determine which diseases or traits are appropriate
for gene editing.
improving crops
→ Way Forward:
 Leading scientists in this field have for long been calling for “global pause” on its applications of human beings,
until internationally accepted protocols are developed.
 Possible alternatives should be explored.
 Govt. should regulate it.
 Human Genome Project (HGP) [1990-2003]:
→ landmark international collaboration genome project that is already having major impact on research across life
sciences, with potential for numerous medical and commercial developments.
→ international scientific research project with goal of determining base pairs that make up human DNA, and of
identifying, mapping and sequencing all of genes of human genome from both physical and functional standpoint.
→ It remains world's largest collaborative biological project.
→ It included only about 85% of human genome. Level "complete genome" was achieved in 2021, with remaining only
0.3% bases covered by potential issues. Missing Y chromosome was added in 2022.
 pgSIT:
→ precision-guided Sterile Insect Technique.
→ CRISPR-based system sterilization
→ to safely restrain mosquito vectors.
→ How:
 pgSIT eggs can be released in wild. This steriled pgSIT eggs will grow and become males. This steriled pgSIT males
will eventually mate with females. It will bring down wild mosquito population.
 WHO Science Council report on accelerating access to genomics for global health [2022]:
→ In 2022, WHO Science Council of experts issued its 1st report, on accelerating access to genomics for global
health. This report argues that it is not justifiable ethically or scientifically for less -resourced countries to
gain access to such technologies long after rich countries do. This report calls for equitable expansion of
genomics.
→ Highlight:

Page 373 of 719

  Expand access: This report calls for expanding access to genomic technologies, particularly in low- and middle-
income countries (LMICs), by addressing shortfalls in financing, laboratory infrastructure, materials, highly
trained personnel.
 Tools used for equitable access: E.g. tiered pricing; sharing of intellectual property rights for low-cost versions;
and cross-subsidization, whereby profits in one area are used to fund another.
 Ethics: This report argues that it is not justifiable ethically or scientifically for less-resourced countries to gain
access to such technologies long after rich countries do.
 This report recommends WHO to create one Genomics Committee for implementation of its recommendations.
→ Recommendations:
 Advocacy for genomics: It is needed to persuade governments and other actors about benefits of genomic
technologies.
 Implementation: Local planning, financing, expanded training of essential personnel.
 Collaborations: Between Government ministries, funding agencies, and scientific organizations in academia and
industry.
 Effective oversight and standards: It is key to promoting ethical, legal, equitable use and responsible sharing of
information obtained with genomic methods.
 IndiGen Genome project [2019]:
→ IndiGen Program in one initiative undertaken by CSIR to collect whole genome sequences from different populations
in India, and to enable genetic epidemiology and develop public health technologies applications using population
genome data. This has enabled benchmarking scalability of genome sequencing and computational analysis at
population scale.
→ IndiGen programme aims to undertake whole genome sequencing of thousands of individuals representing diverse
ethnic groups from India.
 Genome India [2020]:
→ Gene-mapping project of GOI to build one grid of Indian “reference genome”, to understand fully type and nature of
diseases and traits that comprise diverse Indian population. Under this, cataloguing of genetic variation in Indian
people will be done.
 Indian SARS-CoV-2 Consortium on Genomics (INSACOG) [2020]:
→ What:
 Indian SARS-CoV-2 Genetics Consortium.
 forum set up under Ministry of Health and Family Welfare by Government of India to study and monitor genome
sequencing and virus variation of circulating strains of COVID-19 in India.
 consortium of 38 National Laboratories to monitor genomic variations in SARS-CoV-2
 jointly initiated by Ministry of Health and Family Welfare, Department of Biotechnology (DBT), Council for
Scientific & Industrial Research (CSIR), ICMR.
→ Function:
 It carries out genomic sequencing, aiding in understanding spread, evolution of virus, disease
dynamics, severity of virus.
Value Addition:
 Genomics for Public Health in India (IndiGen) programme [2019]:
→ Indian population genome data
→ initiated by CSIR
→ Function:
 to undertake genome sequencing of thousands of individuals representing diverse ethnic groups from India.
→ Objective:
 enable genetic epidemiology
 develop public health technologies applications.
Question:
 Cas9 protein that is often mentioned in news is one molecular scissors used in targeted gene editing.
 With reference to agriculture in India, technique of ‘genome sequencing’, can be used in immediate future as follows:
→ Genome sequencing can be used to identify genetic markers for disease resistance and drought tolerance in various
crop plants.
→ This technique helps in reducing time required to develop new varieties of crop plants.
→ It can be used to decipher host-pathogen relationships in crops.
Genome sequencing is one laboratory method that is used to determine entire genetic makeup of specific organism or
cell type. This method can be used to find changes in areas of genome. These changes may help scientists understand
how specific diseases (such as cancer) form as well as modify genetic makeup of crops as per our needs.
Mains Link:
 Discuss the CRISPR gene-editing technology and the concerns raised by it. (250 words)
 What is Genome Sequencing and what are its benefits? Also, enumerate the steps taken by India in this
direction. (10M)

Page 374 of 719

 EMPLOYMENT / UNEMPLOYMENT
News:
 2021:
→ Union Finance Ministry asks States to split wage payments under MGNREGA scheme into separate categories for:
Scheduled Castes, Scheduled Tribes, and Others from financial year 2021-22. Arguments:

{Rationale} {Concerns}
Helps in assessing and highlighting benefits flowing may complicate payment system
from budgetary outlay towards Scheduled Castes and
Scheduled Tribes
Highlights what centre is doing for SC and ST may lead to reduction in scheme funding
communities
may cause delay in wage payments
may also restrict MGNREGA to districts with high SC /
ST populations.
Note: Existing system for wages under MGNREGA scheme is for only one type i.e. no category wise wage payment.
→ According to its own financial statement, MGNREGA scheme has run out of funds halfway through financial year
(including Manipur State), and supplementary budgetary allocations will not come to rescue for at least another
month when next Parliamentary session begins.
 Implications:
• payments for MGNREGA workers, material costs will be delayed, unless States dip into their own funds.
• Situation of workers turning into “forced labour” because of delay in wage payments.
 Centre’s response:
• Centre is now accusing many States of “artificially creating demand” for work on ground.
→ Government launches ‘PM-DAKSH’ portal and app.
→ Ministry of Finance allocates additional funds as interim measure for MGNREGS after it ran out of funds allocated in
budget.
→ Stand Up India is extended till 2025.
 2022:
→ Economic survey 2021-22 says highest demand for work under MGNREG scheme was seen in States which are usually
destination of migrant workers, rather than source States.
→ NSO releases Periodic Labour Force Survey (PLFS) – Quarterly Bulletin [January-March 2022].
→ Parliament’s Standing Committee on Rural Development and Panchayati Rajasks Rural Development Ministry to
replace caste-based NREGS payment with earlier mechanism of generation of single Fund Transfer Order.
 Its observations:
• It asked Centre to roll back system of caste-based wages, under which currently NREGS workers are paid
based on whether they belong to Scheduled Caste, Scheduled Tribe, or Others.It wants government to
revert to earlier system by which one single Fund Transfer Order was generated without segregation on
basis of caste.
• Reason is current system creates caste rift. NREGS workers are part of economically weak populace and can
come from any religion/caste, and creation of such payment system wherein one specific community is
preferred over other solely on ground of caste will only give rise to resentment and create rift among
beneficiaries of MGNREGA.
→ Rashtriya Swayamsevak Sangh (RSS) passes resolution calling for labour-intensive Bharatiya Economic Model in view
of rising unemployment in India.
→ Parliamentary Standing Committee on Rural Development and Panchayati Raj submits report on functioning of
MGNREGA to Lok Sabha.
→ Stand-up India scheme completes its 6 years.
→ As youths with educational backwardness are finding difficulties to obtain employment with good compensation
after undergoing short-term skilling courses, Centre highlights need for and significance of PM-DAKSH Yojana.
→ Delhi overtakes Bengaluru to become startup capital of India.
→ Delhi Cabinet passes ambitious Delhi Startup Policy.
→ MoMSME approves extension of Prime Minister Employment Generation Programme (PMEGP) till FY26.
→ During his speech on World Environment Day, PM Modi highlights India’s efforts to create ‘green jobs’.
→ MoSPI (by its wing NSO) releases Periodic Labour Force Survey (PLFS) – Annual Report 2020-21. This report says that
unemployment rate saw decrease of 0.6% and fell to 4.2% in 2020-21, compared with 4.8% in 2019-20.
→ GOI surpasses formal employment creation target set under Aatmanirbhar Bharat Rojgar Yojana (ABRY), which
incentivises employers for creating jobs.
→ Rural Development Ministry issues order to discontinue manual attendance for MGNREGA scheme work sites and to
instead use one mobile phone-based application — National Mobile Monitoring Software (NMMS) for recording

Page 375 of 719

 attendance. Now, Peoples Action for Employment Guarantee (PAEG), one group of academicians and activists, has
asked Rural Development Ministry to withdraw aforesaid order.
 Reason / issue:
• Violation of NREGA: PAEG says that rule that mandates recording attendance on mobile app is violation of
NREGA law. PAEG also flagged series of technical and sociological issues with National Mobile Monitoring
Software (NMMS) app. PAEG pointed out that NREGA law lays down rules about muster rolls — clearly says
that muster roll must be accessible to NREGA workers on demand all day during all working hours. If muster
roll is available only digitally, access will be limited.
• Discourages mates: NMMS app discourages women from being NREGA mates which fundamentally
undermines Ministry’s own repeated push towards encouraging women workers as NREGA mates. [Job of
NREGA mate is to see work of workers working in his / her workplace, to make daily attendance of labourers,
to see who came and who did not.
• Lack of access to digital devices: Having smartphone is now mandatory for NRGEA mates to record
attendance on NMMS. However, many women from poorer households do not have access to smartphones.
• Language issues: NMMS app is designed completely in English and there is no technical help provided to
redress problems.
→ PM Modi participates in 'Udyami Bharat' programme and launches 'Raising and Accelerating MSME
Performance' (RAMP) scheme, 'Capacity Building of First-Time MSME Exporters' (CBFTE) scheme and new
features of 'Prime Minister's Employment Generation Programme' (PMEGP).
→ According to ranking of States and UTs by Department for Promotion of Industry and Internal Trade (DPIIT),
ranks Gujarat, Karnataka as best performers in developing startup ecosystem for budding entrepreneurs.
Among smaller States having population of less than 1 crore, Meghalaya is best performer.
→ NSO releases its Working Paper on Compilation of Labour Indicators of Minimum Set of Gender Indicators to develop
methodology for compiling 3 labour indicators. They are:
 “Proportion of Employed working Part-time, by sex”;
 “Proportion of Employed who are Employer, by sex”;
 “Employment Rate of persons age 25-49 living in household with at least 1 child under age 3 years and with no
children under age 3 years living in household, by sex”.
→ GOI designed one framework for reforms and, since labour is State subject, it encouraged States to implement
changes. 1st off blocks was Rajasthan. Other states followed. V V Giri National Labour Institute’s interim report,
“Impact Assessment Study of Labour Reforms undertaken by States”, provides insights into impacts of these labour
reforms so far.
→ After about 16 years of implementation, one Parliamentary Standing Committee on Rural Development and
Panchayati Raj tabled report, ‘Critical Evaluation of Mahatma Gandhi National Rural Employment Guarantee Act
(MGNREGA)’ in Lok Sabha in early 2022. In that report, this Committee assessed and highlighted shortcomings in
implementation of this flagship scheme and made list of recommendations to be incorporated to improve this
scheme’s outcomes. And, now, Action Taken Report on same is presented in Parliament. Ggovernment has accepted
26 of 33 recommendations made.
→ National Statistical Office (NSO) says (data is based on Periodic Labour Force Survey) that unemployment rate in India
for people aged 15 years and above in urban areas declined to 7.6% during April-June 2022 from 12.6% in 2021.
 Other findings:
• Unemployment rate among females (aged 15 years and above) in urban areas declined to 9.5% in April-
June, 2022 from 14.3% in 2021.
• Labour Force Participation Rate in urban areas for persons aged 15 years and above increased to 47.5% in
April-June 2022, from 46.8% in 2021.
 Analysis:
• It shows decline in unemployment rate, improved LFPR, sustained economic recovery from shadow of Covid
pandemic.
→ India’s GDP growth grew by 13.5% in April-June 2022 — fastest in last 4 quarters — on account of better performance
by agriculture and services sectors.
→ Ministry of Skill Development and Entrepreneurship (MSDE) launches one revamped curriculum on employability
skills in association with Quest Alliance, NSDC and various other curriculum bodies within MSDE ecosystem.
→ MGNREGS (rural employment scheme) social audits hurt by delays, in 4 States, auditors’ wages delayed because
funds from Centre are yet to arrive: Union Rural Development Ministry (MoRD) had told States that failure to carry
out social audit of MGNREGS will invite action, including withholding of funds. However, it is Centre that bears
administrative cost of these Social Audit Units, and inordinate delay in release of funds has left many of these cash-
strapped units. As per MoRD, only 14.29% of planned audits have been completed so far in this FY 2022-23.
 [Social audit: Every Social Audit Unit is entitled to funds equivalent to 0.5 % of MGNREGA expenditure incurred
by that State in previous year. Social audit involves quality checks of infrastructure, financial misappropriation
in wages, and checking for any procedural deviations].
→ Automation impacts lower-level jobs in banks; ATM usage, mobile and online transactions, and fewer new
bank branches have led to reduced recruitment: Finance Ministry asks heads of public sector banks (PSBs)
Page 376 of 719
 for plan to improve employee count. Business Line (newspaper) reported that vacancies announced for
clerical posts had significantly decreased in year 2022, and it also showed declining interest in bank jobs,
with increasingly fewer candidates registering for recruitment / selection programmes. [Earlier, All India
Bank Employees Association had carried out strike insisting that recruitment of workers be increased,
among other demands].
→ MGNREGS will fund work to reverse desertification of land across States. This employment scheme will
work in tandem with Pradhan Mantri Krishi Sinchayee Yojana to help take up treatment of about 30% more
land than feasible with current scheme size. With limited funds to deal with big task of restoring degraded
land and reversing desertification in India, GOI is now planning to bring convergence between MGNREGS
and Pradhan Mantri Krishi Sinchayee Yojana (PMKSY).
→ A study titled “Employment guarantee during COVID-19 — The Role of MGNREGA in the year after the 2020
lockdown” conducted by Centre for Sustainable Employment, Azim Premji University is released.
→ Union Minister Shri Dharmendra Pradhan launches the draft of National Credit Framework (NCrF) for public
consultation: Taking the vision of the National Education Policy (NEP) 2020, GOI develops National Credit
Framework (NCrF) to enable the integration of academic and vocational domains to ensure flexibility and
mobility between the two.
Constitution:
 Article 41 (Right to work, right to education and right to public assistance in certain cases):
→ State shall, within limits of its economic capacity and development, secure - right to work, right to education, right
to public assistance - in cases of unemployment, old age, sickness, disablement, undeserved want.
About:
 Unemployment rate:
→ % of total labour force that is unemployed but actively seeking employment and willing to work.
 Green job / Green-collar job / Sustainability job / Eco job / Environmental job:
→ What:
 UNEP defines it as work in agricultural, manufacturing, research and development (R&D), administrative, and
service activities that contribute(s) substantially to preserving or restoring environmental quality. This includes
jobs that help to protect ecosystems and biodiversity; reduce energy, materials, and water consumption through
high efficiency strategies; de-carbonize economy; and minimize or altogether avoid generation of all forms of
waste and pollution.
 Class of jobs that directly have positive impact on planet, and contribute to overall environmental welfare. Jobs
involving renewable energy, conservation of resources, ensuring energy efficient means etc.
 Decent jobs that contribute to preserve or restore environment, be they in traditional sectors such as
manufacturing and construction, or in new, emerging green sectors such as renewable energy and energy
efficiency.
→ Aim:
 Reducing negative environmental impact of economic sectors and furthering process of creating low-carbon
economy.
→ Initiative:
 Skill Council for Green Jobs (SCGJ) [2015] [India]:
• not-for-profit, independent, industry-led initiative.
• It was aligned to National Skill Development Missions [2015].
• Promoted by MNRE and Confederation of Indian Industry (CII).
• To help manufacturers and other service providers in India’s ‘green business’ sector.
 Green Jobs Initiative [2008] (Global):
• ILO, International Trade Union Confederation, UNEP¸ International Employers Organisation collectively
launched it in 2008.
• It is aimed at bettering placements, training and creating opportunities for individuals to work in ‘green
jobs’.
→ Significance:
 Environmental sector has dual benefit of mitigating environmental challenges as well as helping economic
growth.
 For India ‘green jobs’ can prove immensely useful to it with sectors like renewable energy, waste management,
green transport, urban farming all having great potential to employ trained workforce.
 Unemployment in India:
→ Types:
 Disguised Unemployment:
• phenomenon wherein more people are employed than actually needed.
• It is primarily traced in agricultural, unorganised sectors of India.
 Seasonal Unemployment:
• It is unemployment that occurs during certain seasons of year.

Page 377 of 719

 • Agricultural labourers in India rarely have work throughout year.
 Structural Unemployment:
• unemployment arising from mismatch between jobs available in market and skills of available workers in
market.
• Many people in India do not get job due to lack of requisite skills and due to poor education level, it becomes
difficult to train them.
 Cyclical Unemployment:
• It is result of business cycle, where unemployment rises during recessions and declines with economic
growth.
• Cyclical unemployment figures in India are negligible.
• mostly found in capitalist economies.
 Technological Unemployment:
• It is loss of jobs due to changes in technology.
• In 2016, World Bank data predicted that proportion of jobs threatened by automation in India is 69% year-
on-year.
 Frictional Unemployment / Search Unemployment:
• Time lag between jobs when individual is searching for new job or is switching between jobs.
• employee requires time for searching new job or shifting from existing to new job, this inevitable time delay
causes frictional unemployment.
• It is often considered as voluntary unemployment because it is not caused due to shortage of job, but in
fact, workers themselves quit their jobs in search of better opportunities.
 Vulnerable Employment:
• people working informally, without proper job contracts and thus without any legal protection.
• These persons are deemed ‘unemployed’ since records of their work are never maintained.
• It is one of main types of unemployment in India.
→ Causes:
 Automation example in banking sector – use of ATMs, online and mobile transactions, reduction in bank
branches etc.
 Large population.
 Low or no educational levels, vocational skills of working population.
 Inadequate state support
 legal complexities
 low infrastructural, financial, market linkages to small/ cottage industries, small businesses, and thus making
such enterprises unviable with cost, compliance overruns.
 Huge workforce associated with informal sector due to lack of required education/ skills, which is not captured
in any employment data. For ex: domestic helpers, construction workers etc.
 Syllabus taught in schools, colleges, being not as per current requirements of industries. This is main cause of
structural unemployment.
 Inadequate growth of infrastructure, low investments in manufacturing sector, and hence restricting
employment potential of secondary sector.
 Low productivity in agriculture sector, lack of alternative opportunities for agricultural worker make transition
from primary to secondary, tertiary sectors difficult.
 Regressive social norms that deter women from taking/continuing employment.
→ Impact:
 It gives rise to problem of poverty.
 Young people after long time of unemployment indulge in illegal, wrong activities for earning money. This also
leads to increase in crime.
 Unemployed persons can easily be tempted by antisocial elements. This makes them lose faith in democratic
values of country.
 It is often seen that unemployed people end up getting addicted to drugs, alcohol, attempted suicide, and thus
leading to loss of human resources of India.
 It also affects economy of India as workforce that could have been gainfully employed to generate resources
actually gets dependent on remaining working population, and thus escalating socioeconomic costs for state.
For instance, 1% increase in unemployment reduces GDP by 2%.
→ Initiative:
 Training of Rural Youth for Self-Employment (TRYSEM) [1979]:
• to help unemployed rural youth between age of 18 and 35 years to acquire skills for self-employment.
• Priority was given to SC/ST Youth, Women.
 Integrated Rural Development Program (IRDP) [1980]:
• to create full employment opportunities in rural areas.
 Rural Self Employment Training Institute (RSETI):
Page 378 of 719
 • To mitigate unemployment problem among youth
• They are now managed by Banks with active co-operation from Government of India, concerned State
Government.
 Jawahar Rozgar Yojana (JRY) [1989]:
• By merging two erstwhile wage employment programmes – 1980 National Rural Employment programme
(NREP) and 1983 Rural Landless Employment Guarantee Programme (RLEGP) on 80:20 cost sharing basis
between centre and States.
 MNREGA [2005]:
• employment scheme to provide social security by guaranteeing minimum of 100 days paid work per year to
all families whose adult members opt for unskilled labour-intensive work.
• This act provides Right to Work to people.
 Skill India Mission [2015].
 Pradhan Mantri Kaushal Vikas Yojana (PMKVY) [2015].
 Startup India Scheme [2016].
 Stand-Up India Scheme [2016].
→ Status:
 India’s unemployment rate is rising. Demonetisation, Covid-19 pandemic also have hit economy and dried up
opportunities.
 Unemployment rate went up to 7.91% in 2021 from 6.3% in 2018-19, 4.7% in 2017-18.
 Manufacturing sector is said to have lost 9.8 million jobs between 2019-20 and 2021.
→ Way Forward:
 Pushing government to support small and medium enterprises in manufacturing sector.
 By working with youth at grassroots to help them engage into entrepreneurial ventures through agri-allied
activities, other self-employment opportunities.
 There are ample opportunities for creation of jobs in rural India through industrialisation, food processing, agri-
allied activities such as animal husbandry, bamboo farming, pisciculture etc.
Note:
 Right to work:
→ Constitution does not explicitly mention 'right to work' as fundamental right.
→ It is through Article 41 (DPSP) that 'right to work' finds its place.
 Periodic Labour Force Survey (PLFS) [2017]:
→ What:
 Survey of labour force in India.
 It is India’s 1st computer-based survey.
→ Origin:
 Considering importance of availability of labour force data at more frequent time intervals, National Statistical
Office (NSO) launched PLFS in 2017.
 It was constituted based on recommendation of Amitabh Kundu committee [2013].
→ Objective:
 To estimate key employment and unemployment indicators (viz. Worker Population Ratio, Labour Force
Participation Rate, Unemployment Rate) in short time interval of 3 months for urban areas only in ‘Current
Weekly Status’ (CWS).
 To estimate employment and unemployment indicators in both ‘Usual Status’ (ps+ss) and ‘Current Weekly
Status’ (CWS) in both rural and urban areas annually.
→ Definition:
 Labour Force Participation Rate (LFPR): LFPR is defined as % of persons in labour force (i.e. working or seeking
or available for work) in population.
 Worker Population Ratio (WPR): WPR is defined as % of employed persons in population.
 Unemployment Rate (UR): UR is defined as % of persons unemployed among persons in labour force.
 Activity Status - Usual Status: Activity status of person is determined on basis of activities pursued by that person
during specified reference period. When activity status is determined on basis of reference period of last 365
days preceding date of survey, it is known as usual activity status of that person.
 Current Weekly Status (CWS): Activity status of person is determined on basis of activities pursued by that
person during specified reference period. Activity status determined on basis of reference period of last 7 days
preceding date of survey is known as CWS of that person.
 Principal activity status: Activity status on which person spent relatively long time (major time criterion) during
365 days preceding date of survey is usual principal activity status of that person.
 Subsidiary economic activity status: Activity status in which person in addition to his / her usual principal status,
performs some economic activity for 30 days or more for reference period of 365 days preceding date of survey
is subsidiary economic status of that person.
→ Measuring unemployment:
Page 379 of 719
 Usual Status Approach: It records only those persons as being unemployed who had no gainful work for major
time during 365 days preceding date of survey and are actively seeking work.
 Weekly Status Approach: Person is considered to be employed if he or she pursues any one or more of gainful
activities for at least 1 hour on any day of reference week. Individual who may be employed on usual status
approach may however become intermittently unemployed during some seasons or parts of year. Therefore,
unlike usual status approach, weekly status approach can measure not only open chronic unemployment but
also seasonal unemployment.
 Current Daily Status Approach: Accordingly, person having no gainful work even for 1 hour in 1 day is described
as unemployed for full day. This approach is beneficial in sectors like farming and non-farming households where
employment often fluctuates over small period within 1 week.
→ Periodic Labour Force Survey (PLFS) – Annual Report 2020-21:
 Findings:
• UR: Data show rate of joblessness fell to 4.2% in 2020-21, compared with 4.8% in 2019-20. Rural areas
recorded unemployment rate of 3.3% and urban areas recorded unemployment rate of 6.7%.
• LFPR: 41.6% during 2020-21 (which is higher than 40.1% in PLFS 2019-20). All-India female LFPR in usual
status is 25.1%.
• WPR: 39.8% (which is higher from 38.2% in PLFS 2019-20)
• Migration rate: Among women was 48% and 47.8% in rural and urban areas, respectively. (Migrants are
defined as household members whose last usual place of residence, at any time in past, was different from
present place of enumeration).
• Employment-related migration: 4.4% of migration happened due to employment, which is drastic reduction
from 10% in 2011 (decade ago).
 How did NSO collect sample?
• NSO uses “rotational panel sampling design” in urban areas to assess LFPR, WPR, UR and visits selected
households in urban areas 4 times. There was, however, no revisit for rural samples.
 Indication of this report:
• Overall, this report suggests shifting of government’s policy directions as it has become more rural-centric.
Creation of rural jobs other than in agricultural sector and MGNREGA could be priorities for government at
Union and State levels.
 Issues with this NSO survey:
• Experts point out that 2nd visit to households in rural areas could have provided bigger and larger picture of
unemployment, which did not happen in this survey.
 Mahatma Gandhi National Rural Employment Guarantee Act, 2005/ MGNREGA [2005]:
→ What:
 Labour law / social measure that guarantees “right to work” i.e. to implement DPSP Article 41. It mandates local
government to legally provide at least 100 days of wage employment in rural India to enhance their quality of
life. centrally-sponsored scheme.
→ Objective:
 Generation of paid rural employment of not less than 100 days for each worker who volunteers for unskilled
labour.
 social inclusion by strengthening livelihood of rural poor.
 Creation of durable assets in rural areas - wells, ponds, roads, canals.
 Reduce urban migration from rural areas.
 Create rural infrastructure by using untapped rural labour.
→ Features:
 Applicant must be part of local household i.e. within local Gram Panchayat. Application must be made with local
Gram Panchayat only.
 Mandatory Social Audit of MGNREGA works [thus accountability, transparency].
 Applicant must volunteer for unskilled labour.
 Right to unemployment allowance.
 Individual beneficiary-oriented works can be taken up for Scheduled Castes, Scheduled Tribes, small or marginal
farmers, beneficiaries of land reforms, or beneficiaries under Indira Awaas Yojana of Government of India.
 MGNREGA scheme is a centrally-sponsored scheme.
→ Eligibility:
 Ony citizens of India. 18 years of age. Job seeker / applicant must be part of local household (local Gram
Panchayat). Applicants must volunteer for unskilled labour.
→ Implementation:
 Ministry of Rural Development (MRD), Govt of India is monitoring entire implementation of this scheme in
association with State governments.
 Within 15 days of submitting application, wage employment will be provided.
 Right to unemployment allowance [when work is not provided within 15 days].
Page 380 of 719
  Mandatory Social Audit of MGNREGA works [thus accountability, transparency].
 Gram Sabha - principal forum for wage seekers to raise their voices and make demands.
 Gram Sabha and Gram Panchayat (GP) approve works under MGNREGA and fix priorities.
 GP issues Job Cards (JCs).
→ Payment system / wage payment:
 Caste-based payment system [2021]:
• What:
 Under this new system, if 20 individuals (say, six SCs, four STs, 10 others) work together at site under
MGNREGA, then one single muster roll would be issued, but payment would be done by issuing three
separate Fund Transfer Orders (FTOs), one for each of said three categories.
 Beneficiaries in ‘Others’ category, which includes ‘General’, OBC categories, especially complained of
delays.
• Need:
 According to Rural Development Ministry, system of category-wise payment of wages was introduced
to accurately reflect on ground flow of funds to many population groups.
 In 2021, process of “streamlining” of this new system was taken up.
 Status:
• In 2022, Parliament’s Standing Committee on Rural Development and Panchayati Rajasked Rural
Development Ministry to replace caste-based NREGS payment with earlier mechanism of
generation of single Fund Transfer Order.
 Its observations:
o It asked Centre to roll back system of caste-based wages, under which currently NREGS workers
are paid based on whether they belong to Scheduled Caste, Scheduled Tribe, or Others.It wants
government to revert to earlier system by which one single Fund Transfer Order was generated
without segregation on basis of caste.
o Reason is current system creates caste rift. NREGS workers are part of economically weak populace
and can come from any religion/caste, and creation of such payment system wherein one specific
community is preferred over other solely on ground of caste will only give rise to resentment and
create rift among beneficiaries of MGNREGA.
→ 2022 Report of Parliamentary Standing Committee on Rural Development and Panchayati Raj on functioning of
MGNREGA:
 Concerns highlighted:
• There has always been hike in revised estimate over budget estimate in past.
• Delay in release of funds.
• Wide disparity in wage rate between one State to another.
• Fake job cards
• widespread corruption
• late uploading of muster rolls.
 Recommendations:
• Increasing number of guaranteed working days from 100 to at least 150.
• Increase permissible work, taking into account local geographical terrain and local requirements.
• Government should relook at its calculation and suitably approach ministry of finance for higher allocation
of funds in order to speed up pace of rural development schemes.
• Promote women-centric work.
• Increase in wages and link it with inflation. But currently, it is linked with CPI-AL (agriculture labour).
• Timely funding.
• Convergence of various rural development schemes along with MGNREGA as it would help address rural
poverty.
• Doorstep medical facilities for job cardholders.
• Roll back system of caste-based wages, under which NREGS workers are paid based on whether they belong
to SC, ST, or Others, with earlier system - single Fund Transfer Order.
→ “Employment guarantee during COVID-19 — The Role of MGNREGA in the year after the 2020 lockdown”:
• It is a study report released in 2022 and conducted by Centre for Sustainable Employment, Azim
Premji University. This report, in a 1 st , provides empirical evidence conducted on the impact of
MGNREGA during the COVID-19 pandemic. This study has revealed that the wages earned under
MGNREGA Act helped compensating somewhere between 20% and 80% of the income loss
incurred because of the Covid lockdown. However, the report also says that around 39% all job
card-holding households interested in working under the MGNREGA did not get a single day of
work in the COVID year of 2020-21. As of 2022-23, there are 15.4 crore active workers under the
MGNREGA.
→ Issues:

Page 381 of 719

 Timely access to wages:
• As per 2020 Lib Tech India report, MGNREGA workers can not access their own wages in timely manner
because of: multiple trips to bank - travel costs, income losses; repeated rejections of payment; biometric
errors; wrong information.
 Pay to social auditors:
• Some Audit Departments, like in Himachal Pradesh, were unable to pay their auditors for over 1 year. Even
when funds arrive, Centre rarely pays entire amount. Bihar Social Audit Unit had not received funds since
2020 – for more than 2 years.
• Social Audit Units in Jharkhand, Nagaland, Tamil Nadu, Telangana, Karnataka were forced to take loans from
their respective State governments in order to sustain their operations.
 Concerns highlighted by 2022 Report of Parliamentary Standing Committee on Rural Development and
Panchayati Raj on functioning of MGNREGA:
• There has always been hike in revised estimate over budget estimate in past.
• Delay in release of funds.
• Wide disparity in wage rate between one State to another.
• Fake job cards
• widespread corruption
• late uploading of muster rolls.
→ Need for reforms:
 As per latest 2021-22 economic survey, demand for work under MGNREGA scheme has dropped; and highest
demand for work under this scheme was seen in States which are usually destination of migrant workers, rather
than source States.
→ Significance:
 Generation of paid rural employment.
 social inclusion.
 Creation of rural infrastructure, durable assets - wells, ponds, roads, canals.
 Reduce urban migration from rural areas.
 Accountability and transparency via mandatory Social Audit of MGNREGA works.
 Local governance: Wage seekers raise their voices / demands in Gram Sabha.
 It contributes to SDG goals - No poverty; Zero Hunger; Good Health and Well-being; Quality Education; Gender
Equality; Decent Work and Economic Growth; Industry, Innovation and Infrastructure; Reduced Inequality.
 Prime Minister Employment Generation Programme (PMEGP) [2008-09]:
→ What:
 Central sector scheme administered by MoMSME.
 It is credit-linked subsidy scheme which promotes self-employment through setting up of micro-enterprises,
where subsidy up to 35% is provided by Government through Ministry of MSME for loans up to Rs. 50 lakhs in
manufacturing and Rs. 20 lakhs in service sector.
→ Eligibility:
 Any individual above 18 years of age, SHGs, Institutions registered under Societies Registration Act, 1860,
Production Co-operative Societies, Charitable Trusts.
 Only new projects are considered for sanction under PMEGP.
 [Not eligible - Existing Units and units that have already availed Government Subsidy under any other scheme of
Government of India or State Government].
→ Implementation:
 Khadi and Village Industries Commission (KVIC) - nodal agency, along with State KVIC Directorates, State Khadi
and Village Industries Boards (KVIBs), District Industries Centres (DICs), banks.
→ Significance:
 It will create sustainable estimated employment opportunities.
 It facilitates generation of employment opportunities for unemployed youth across India by assisting setting up
of micro-enterprises in non-farm sector.
 Stand-Up India / Stand Up India [2016]:
→ What:
 Scheme of govt. of India to facilitate bank loans between Rs 10 lakh and Rs. 1 crore to at least one SC or ST
borrower and at least 1 women borrower per bank branch for setting up greenfield enterprise.
→ Aim:
 promote entrepreneurship at grass-root level, for economic empowerment and for job creation.
 To leverage institutional credit structure to reach out to underserved sector of people such as SCs,
STs, Women Entrepreneurs.
→ How:
 institutional credit (bank loan) will be given but only for greenfield projects to: SCs, STs, Women
Entrepreneurs.
Page 382 of 719
  SIDBI, NABARD are designated as Stand-Up Connect Centres (SUCC).
→ Eligibility:
 SC, ST, women entrepreneurs of above 18 years of age.
 Borrower should not be in default to any bank or financial institution.
 In case of non-individual enterprises, at least 51% of shareholding and controlling stake should be held
by either SC or ST or Woman entrepreneur.
→ Performance so far:
 Women-led enterprises have dominated bank sanctions so far.
 Over 1.33 lakh new job-creators and entrepreneurs have been facilitated.
 Over 1 lakh women entrepreneurs have benefited.
 Rs. 30,160 crores have been sanctioned by government to total of 1,33,995 accounts.
 Out of total sanctioned accounts, 6,435 accounts belonged to ST borrowers with Rs 1373.71 crore
sanctioned and 19,310 accounts belonged to SC borrowers with Rs 3976.84 crore sanctioned.
 To 1,08,250 women entrepreneurs who held accounts, Rs. 24809.89 crore has been sanctioned.
 Pradhan Mantri Dakshta Aur Kushalta Sampann Hitgrahi Yojana / PM-DAKSH Yojana [2020]:
→ What:
 National Action Plan (NAP) for skilling of marginalized persons covering SCs, OBCs, EBCs, DNTs, Sanitation
workers including waste pickers.
 eligible target groups are being provided skill development training programmes.
 implemented by Ministry of Social Justice and Empowerment.
→ Aim:
 to make skill development schemes accessible to target groups of Backward Classes, Scheduled Castes,
SafaiKaramcharis.
→ Eligibility:
 SC; OBC; Economically Backward Classes; De-notified tribes; Sanitation workers including waste pickers, manual
scavengers; transgenders.
→ Need:
 target group have minimal economic assets
 many target group belong to rural artisans who have become marginalized because of replacement by
technologies in market.
 women amongst target group have overall domestic compulsions, and thus cannot be involved in wage
employment which normally involves long working hours and sometimes migration to other cities.
→ Significance:
 Training is essential for economic empowerment/ upliftment of marginalized target groups.
 Aatmanirbhar Bharat Rojgar Yojana (ABRY) [2020]:
→ What:
 One GOI scheme to incentivize employers for creation of new employment.
 ABRY was announced as part of Aatmanirbhar Bharat 3.0 package to boost Indian economy, to increase
employment generation in post Covid recovery phase and to incentivize creation of new employment along with
social security benefits and restoration of loss of employment during COVID-19 pandemic.
 This scheme reduces financial burden of employers of various sectors / industries and encourages them to hire
more workers.
 This scheme is implemented through Employees Provident Fund Organization (EPFO).
→ Objective:
 To incentivise employers of establishments, registered under Employees’ Provident Funds and Miscellaneous
Provisions Act, 1952 / EPF & MP Act, 1952, for generation of new employment and to support new employees
entering formal / organized sector with monthly wage of less than Rs. 15000 & re-employing persons from low
wage bracket who lost their jobs during COVID-19 pandemic.
→ Feature:
 Employee drawing monthly wage of less than Rs. 15000/- who was not working in any EPFO registered
establishment and did not have Universal Account Number (UAN) can avail of this scheme.
 Establishment that registered with EPFO after commencement of this scheme will get subsidy for all new
employees.
 2022 Rashtriya Swayamsevak Sangh (RSS) resolution for labour-intensive Bharatiya Economic Model:
→ Society must come forward and participate in building Atmanirbhar Bharat where economic model is based
on Indian values.
→ Model should be human-centric, labour intensive, eco-friendly, decentralised, equitably distribution of
benefits.
→ Model should augment village economy, microscale, small scale, agro -based industries.
→ As solutions to unemployment, thrust areas should be rural employability, unorganised sector
employment, employment of women.
Page 383 of 719
 → RSS also urged youth to come out of mentality of seeking only jobs. Environment conducive to encouraging
entrepreneurship should be created by educating and counselling people, especially youth.
 National Mobile Monitoring Software (NMMS) [2021] and Area Officer Monitoring App [2021]:
→ NMMS App is aimed at bringing more transparency and ensuring proper monitoring of schemes. NMMS App permits
taking real time attendance of workers at NREGA worksites along with geo-tagged photograph. This app helps in
increasing citizen oversight of NREGA programme. NMMS App is applicable for NREGA workers for all States / Union
Territories. It will increase citizen oversight of NREGA programme besides potentially enabling processing payments
faster.
→ Area Officer Monitoring App [2021] facilitates to record findings online along with time stamped and go-coordinate
tagged photograph for all schemes of Dept. of Rural Development - NREGS, PMAYG, PMGSY. This would also enable
not only better record keeping of inspections by field and supervisory officials but also facilitate analysis of findings
for better programme implementation.
 Working Paper on Compilation of Labour Indicators of Minimum Set of Gender Indicators [NSO] [2022]:
→ What:
 Paper released by NSO in 2022 to develop methodology for compiling 3 labour indicators which are:
• “Proportion of Employed working Part-time, by sex”;
• “Proportion of Employed who are Employer, by sex”;
• “Employment Rate of persons age 25-49 living in household with at least 1 child under age 3 years and with
no children under age 3 years living in household, by sex”.
→ Finding:
 Childcare affects employment of women: Employment rate of females (25-49 years) with at least 1 child under
3 years of age is less than those with no child. However, for males, it doesn’t make any difference.
 Proportion of employed persons working part-time at all India level was more than 10% between 2017-20.
 Proportion of employed persons working part-time in age group of above 60 years, was more than 15% between
2017-20.
 In developed countries, policy-makers have promoted part-time work in attempt to redistribute working time in
countries of high unemployment, thus lowering politically sensitive unemployment rates without requiring
increase in total number of hours worked.
 In India, proportion of employed persons working part time is more among females than males irrespective of
age-groups.
 Employment Rate of Employed Worker living in household with no child under age 3 years, rose.
 Proportion of employed persons who are employer in above 15 age group has been estimated at 2.02% for 2019-
20 (decrease from 2018-19).
 There has been rapid growth in part-time work in past few decades in developed economies. Reasons: Increase
in female labour force participation; policies attempting to raise labour market flexibility in reaction to changing
work organization within industries and to growth of services sector.
 Part-time employment has been seen as instrument to increase labour supply.
→ Suggestion:
 This NSO paper expressed concern that policy-makers are moving towards more flexible working arrangements
which is risk as such working arrangements may be less economically secure and less stable than full- time
employment. However, part-time work may offer chance of better balance between working life and family
responsibilities, and suits workers who prefer shorter working hours and more time for their personal life.
 Labour Force Participation Rate (LFPR):
→ It is number of persons in labour force as % of working-age population. Labour force is sum of number of persons
employed and number of persons unemployed.
 Revamped curriculum on employability skills [2022]:
→ What: One initiative to skill India’s youth. It will provide 120 hr curriculum to over 15000 Industrial Training
Institutes to help them self-learn 21st-century skills. This curriculum was launched by Ministry of Skill Development
and Entrepreneurship (MSDE) in association with Quest Alliance, NSDC and various other curriculum bodies within
MSDE ecosystem. This initiative is supported by Future Right Skills Network, one collaborative effort by Quest
Alliance, Accenture, Cisco, J.P. Morgan. This curriculum was launched as part of “Shikshak Parv” celebrations.
→ Aim: Its aim is to upgrade employability skills curriculum for young learners to be 21st century ready.
 Future Right Skills Network:
→ One collaborative effort by Accenture, Cisco and JP Morgan facilitated by Quest Alliance with overarching mission
to make India’s youth future-ready. This network is supported by civil society organizations and State governments
in partnership with Directorate General of Training (DGT) under Ministry of Skill Development and
Entrepreneurship. It aims to empower young people in technical and vocational training institutes with
employability skills for knowledge economy.
 Quest Alliance:

Page 384 of 719

 → One Indian not-for-profit trust that equips young people with 21st century skills by enabling self-learning. It designs
scalable solutions that enable educators to address critical gaps for quality education and skills training. It facilitates
learning networks and collaboration to bring about systemic change fuelled by research and innovation.
Value Addition:
 Unemployment trap:
→ Situation when unemployment benefits discourage unemployed to go to work. People find opportunity cost of going
to work too high when they can simply enjoy benefits by doing nothing.
→ Unemployment trap arises when opportunity cost of going to work is higher than income received, discouraging
people from returning to work and being productive.
 Wage Drift:
→ Difference or change in wage actually paid to worker and locally negotiated wage.
→ Reasons: Overtime, bonus payment etc.
Mains Link:
 Despite a decrease in the unemployment rate, the government has been found lacking in providing gainful employment
in India. Discuss the reasons behind it and suggest suitable remedies. (15M)
 “MGNREGA created rural infrastructure and assets, along with increasing rural demand and employment”. How far has
the scheme been successful in its objective? Critically analyze.
 Discuss the key features and significance of MGNREGA.

WATER
News:
 2021:
→ Himachal Pradesh (HP) is likely to face severe water scarcity in 2021 summer, including driking water. Many water
schemes may be closed.
→ 4 West African countries –Mauritania, Senegal, Gambia, Guinea Bissau - signed joint declaration to advance
transboundary cooperation in Senegal-Mauritanian Aquifer Basin (SMAB).
→ World Meteorological Organization (WMO) releases report on terrestrial water storage (TWS) loss.
 2022:
→ Allocation of Rs. 60,000 crore made to cover 3.8 crore households in 2022-23 under Har Ghar, Nal Se Jal scheme.
→ 50% of rural households in India are now covered under JJM. At time of launch of JJM in 2019, only 3.23 Crore
households i.e. 17% of rural population had access to drinking water through taps.
→ Status of JJM project is that it is at 51% mark of completion.
→ Speaking on government’s JJM, PM Modi says 10 crore rural households in India have piped water connections today.
Modi congratulated Goa government for becoming 1st State to be ‘Har Ghar Jal-certified’, which means that every
household in Goa State had piped water connection. He said that Union Territories of Dadra Nagar Haveli, Daman
and Diu too had achieved this feat.
→ MoHUA onboards / shortlists 76 start-ups under ‘India Water Pitch-Pilot-Scale Start-Up Challenge’. These shortlisted
start-ups will be provided financial support of up to Rs. 20 lakh each to work in fields of water supply, used water
management, water body rejuvenation, ground water management etc.
MoHUA also launches one portal Urban Waterbody Information System (UWaIS) with help from National
Remote Sensing Centre, Hyderabad. This portal will provide satellite images of water bodies to various cities to plan
their rejuvenation for proper water management planning in cities. 219 cities have been handed over UWaIS dossiers
of water bodies.
→ UN-Water releases UN World Water Development Report 2022. [This report encapsulates global concern over sharp
rise in freshwater withdrawal from streams, lakes, aquifers, human-made reservoirs, impending water stress and
also water scarcity being experienced in different parts of world].
→ UN estimates that by year 2050, 4 billion people will be seriously affected by water shortages, hence shifting
attention from linear water management to multi-dimensional integrated water management approach, that is, ‘One
Water’ approach is needed.
→ India and Denmark together launch one whitepaper on ‘Urban Wastewater Scenario in India’ at World Water
Congress & Exhibition 2022 in Copenhagen, Denmark. This India-Denmark whitepaper aims to holistically capture
current status of wastewater treatment in India and potential pathways for future treatment structures, co-creation,
and collaborations.
→ Jal Shakti Minister Gajendra Singh Shekhawat declares AN Islands as India's 1st Swachh Sujal Pradesh.
→ India could start trading in water on commodity exchanges, much like gold, silver, crude oil: NITI Aayog will put out
draft recommendations for public consultations, pitching all options, including futures and spot trading of water and
tradable licenses. NITI aims to ensure better price discovery of water, efficient use and more investment into water
resources.
→ Gujarat government achieves 100% tap water connections in rural areas under the Jal Jeevan Mission.
About:
 Earth’s water:
→ Total global water = Oceans (96.5%) + Other saline water (0.9%) + Freshwater (2.5%).
Page 385 of 719
 → Freshwater (2.5% of total Earth’s water) = Glaciers & ice caps (highest) + Groundwater + Surface water &
other freshwater (least).
→ Surface water & other freshwater = Ground ice & permafrost (highest) + Lakes + Soil moisture + Swamps,
marshes + rivers + atmosphere + living things (least).
 Water as human right:
→ In 2010, UN recognized “right to safe and clean drinking water and sanitation as human right that is
essential for full enjoyment of life and all human rights .”
→ Human right to water entitles everyone, without discrimination, to sufficient, safe, acceptable, physically
accessible and affordable water for personal and domestic use; which includes water for drinking, personal
sanitation, washing of clothes, food preparation, personal and household hygiene.
 Groundwater / Ground-water / Groundwater:
→ Need to conserve groundwater:
 Groundwater reserves are already under pressure as global population explodes and crop production rises.
 Extreme weather events such as drought, record rainfall could have another long-lasting impact on how quickly
reserves replenish.
 Only 1/2 of all groundwater supplies are likely to fully replenish or re-balance within next 100 years — potentially
leading to shortages in drier areas.
 Process through which rainwater is filtered through bedrock and accumulated underground can take centuries
and varies greatly by region.
 As climate change delivers longer droughts and bigger superstorms, extremes of rainfall become more
pronounced, impacting groundwater reserves for generations to come.
 Greywater / Grey water / Sullage:
→ What:
 It refers to domestic wastewater generated in households or office buildings from streams without fecal
contamination, i.e., all streams except for wastewater from toilets. Sources of greywater include sinks, showers,
baths, washing machines or dishwashers. As greywater contains fewer pathogens than domestic wastewater, it
is generally safer to handle and easier to treat and reuse onsite for toilet flushing, landscape or crop irrigation,
and other non-potable uses. Greywater may still have some pathogen content from laundering soiled clothing
or cleaning anal area in shower or bath.
→ Usage:
 Application of greywater reuse in urban water systems provides substantial benefits for both water supply
subsystem, by reducing demand for fresh clean water, and wastewater subsystems by reducing amount of
conveyed and treated wastewater. Treated greywater has many uses, such as toilet flushing or irrigation.
→ Grey water management:
 Greywater recycling can help reduce demand for water and help agriculture (grey water has high nitrogen and
phosphorus content). India’s ‘Water+’ status demands greywater recycling.
 Water Crisis:
→ UN estimated that by year 2050, 4 billion people will be seriously affected by water shortages, which might
lead to multiple conflicts between countries over water sharing.
→ 31 countries are already facing shortage of water and by 2025, there will be 48 countries facing serious
water shortages.
→ Water Crisis in India:
 Global Drought Risk and Water Stress map (2019) shows that major parts of India, particularly west, central,
parts of peninsular India are highly water-stressed and experience water scarcity.
 NITI Aayog report - ‘Composite Water Management Index’ (2018) says that more than 600 million people are
facing acute water shortages.
 According to World Resources Institute, 54% of India faces high to extremely high water stress.
 World Bank report says water currently available to individual will significantly fall by 2030. This will create
unimaginable disaster for majority people in India.
 India 4% of world’s freshwater but 17% of world’s population. In India, per capita water availability is reducing
[due to increase in population]. Some river basins in India are water stressed. A few river basins in India are
water scarce.
→ Water Crisis in Himachal Pradesh (HP):
 Reason:
• HP has many perennial sources of water. But, still having water crisis because of:
 Less snow and less rain in 2021 winter:
 thus reduced:
o groundwater
o downhill water sources - springs, wells, lakes, streams, rivers.
 Increase demand for water because of increasing population in HP

Page 386 of 719

  People are also relying more on piped water supply schemes rather than on traditional sources of water
– springs, bawris etc.
 Impact:
• crop losses
• reduced fodder availablity.
 Solutions for HP:
• hand-pump and borewell are traditional method of water management. But, in HP they have been restricted
in view of depleting water table in HP.
• So, water harvesting tanks will be built throughout HP.
• Jal Shakti department to explore “snow harvesting” in higher allevations of HP.
→ Impact of water crisis:
 Rural-urban water disputes are very likely to occur as scarcity grows, exacerbated by climate change. Triggers
sectoral and regional competition e.g. water disputes between countries. Silent crisis of global dimension, with
millions of people being deprived of water to live and sustain their livelihood.
 Wastewater:
→ What:
 Wastewater is water generated after use of freshwater, raw water, drinking water or saline water in variety of
deliberate applications or processes. Another definition of wastewater is it is used water from any combination
of domestic, industrial, commercial or agricultural activities, surface runoff / storm water, and any sewer inflow
or sewer infiltration. In everyday usage, wastewater is commonly synonym for sewage (also called sewerage,
domestic wastewater, or municipal wastewater), which is wastewater that is produced by community of people.
→ Initiative:
 In 2022, India and Denmark together launched one whitepaper on ‘Urban Wastewater Scenario in India’ at
World Water Congress & Exhibition 2022 in Copenhagen, Denmark. This India-Denmark whitepaper aims to
holistically capture current status of wastewater treatment in India and potential pathways for future treatment
structures, co-creation, and collaborations.
This whitepaper is one outcome of Green Strategic Partnership (2020) with focus on green hydrogen,
renewable energy and wastewater management between India and Denmark and their bilateral ties.
 India:
→ India has just 4% of world’s water resource, supporting 17.1% of its population. Water is one key
determinant of health security and economic growth in India. Over 50% of agriculture is still rain -fed.
→ Water as public trust [India]:
 In our Constitution, water resources are held in public trust. Therefore, Supreme Court decided to use ‘Public
Trust Doctrine’ to apply stringent provisions against permitting municipal bodies or industries from polluting
rivers.
→ Water Supply:
 Status:
• In 2020, Goa becomes 1st State to provide 100% tap water supply. In 2021, Telangana becomes 2nd State to
provide 100% tap water supply; AN Islands becomes 3rd State to provide 100% tap water supply; Puducherry
becomes 4th State to provide 100% tap water supply.
 Initiative:
• Jal Jeevan Mission (JJM) / Jal Shakti Abhiyan [2019].
→ Water management in India:
 Evolution:
• Till 1980s: Water management was confined to issue of irrigation projects. Therefore, focus was on building
large dams and canals. However, drought of late 1980s, proved that these big projects were insufficient.
• Post-1980s Period: Focus was on decentralization: Eg., rainwater harvesting (building ponds, digging tanks,
and setting up check-dams on streams); slogans like “Rain is decentralized, so is demand for water. So,
capture rain when and where it falls”.
• 2000s: Focus remain on rainwater harvesting and ‘ground water’ was given importance. Therefore,
MGNREGA was linked with augmentation of groundwater, and rainwater harvesting efforts.
• Post-2010s: Series of urban droughts brought in focus issues related to distribution bottleneck and lack of
reuse and treatment of sewage water. So, focus came on Piped drinking water (Jal Jeevan Mission),
treatment of used water (Swachh Bharath Mission).
 What next?
• Reengineering of on-site local treatment systems: It means waste to be collected from each household,
transported, and treated in that area.
• Focus on Reuse: Urban-industrial wastewater and sewage must be treated, recycled, and reused. If it is
treated for reuse, then it will prevent water loss and pollution of our rivers. E.g., in Singapore, almost all
water is treated and reused.

Page 387 of 719

 • Minimize wastages: E.g., investing in water-efficient irrigation (‘per drop more crop’), household appliances,
and changes in our diets.
• Focus on traditional water storing structures: Eg., Baolis (Rajasthan, Gujarat), tanks, Ponds (Talabs), Check
dams (called Bandha in Mewar region), etc. Paar system (western Rajasthan): It is one common place where
rainwater flows from agar (catchment) and in process percolates into sandy soil. Pat System (Bundelkhand
region): This system was devised according to peculiarities of terrain to divert water from swift-flowing hill
streams into irrigation channels called pats.
• Sponge cities: Treated sewage and wastewater must be diverted to sponges (wetlands, ponds, rain gardens)
to recharge groundwater in cities and make us water-secure. E.g., done in Beijing (China).
 Reasons for not getting access to safe water:
→ Gender, marginalized groups. Race, ethnicity, rel igion, birth, caste, language, nationality. Disability, age,
health status. Property, tenure, residence, economic, social status. environmental degradation, climate
change, population growth, conflict, forced displacement, migration flows.
 Water trading:
→ What:
 Process of buying and selling water access entitlements, also often called water rights. Terms of trade
can be either permanent or temporary, depending on legal status of water rights. Water trade allows
water holders to decide whether they need to buy or sell water at particular time.
1 st tradable water price futures index was launched on Chicago stock exchange in 2020. It is in
practice in Australia, Chile, USA etc.
→ Debate:
 Some economists argue that water trading can promote more efficien t water allocation because
market-based price acts as incentive for users to allocate resources from low value activities to high
value activities.
 Challenges:
→ Water resources across world are under tremendous pressure due to human and naturally-induced
stressors like population growth, urbanisation, decreasing availability of freshwater. Extreme weather
events are also responsible for pressure on water resources.
→ Urban: With rapid growth of cities, water demand has exponentially increas ed. Even as aspirations cause
people to migrate to urban areas, water depletion and scarcity remains huge challenge staring at people’s
faces in near future. Water demand is going to increase even more, with India’s population in urban areas
expected to double by 2050. Around 35% of India’s population lived in urban areas as of 2020. In urban
areas, only 45% of demand is met using groundwater resources. Apart from this, climate change, pollution
and contamination have also added to burden on water resources . Water demand exceeds supply in most
cities.
→ In India, there are different water management systems based on utilities like sanitation, urban water,
stormwater, and wastewater that deal with water -related issues in different localities. [Since areas and
localities define distribution and water allocation, it is often challenge to find unified solution].
 Initiative:
→ Global:
 International Decade for Action onWater for Sustainable Development, 2018 -2028
 SDG 6:
• Clean Water and Sanitation
• to ensure availability and sustainable management of water for all by 2030. By definition, this means leaving
no one behind.
→ India:
 AIM-ICDK Water Innovation Challenge in collaboration with Denmark.
 MGNREGA for water conservation. National Rural Drinking Water Programme. NITI Aayog Composite
Water Management Index (CWMI). Formation of Ministry of Jal Shakti. Catch Rain scheme, Jal Kranti
Abhiyan (Jal Gram Scheme to develop two model villages in water -deficient region), MGNREGA for
water conservation, National Water Mission (NWM) (increase water use efficiency by 20%), Jal Jeevan
Mission (for piped drinking water). NWA.
 In 2022, Minister of Jal Shakti Gajendra Singh Shekhawat said PM Modi (GOI) has brought various
activities related to water under one umbrella and formed one integrated ministry in name of Jal Shakti
in 2019. And that, this has given greater synergy and coherence to water management in India. And
that India has committed investments of more than USD 140 billion by 2024 in water sector. He further
said that with help of community-centric approach, at least 10% of these funds are contributed by
community in every program ensuring community ownership and participation.
 Swachh Sujal Pradesh initiative / certification.
 Way Forward:

Page 388 of 719

 → UN estimates that by year 2050, 4 billion people will be seriously affected by water shortages, hence shifting
attention from linear water management to multi-dimensional integrated water management approach, that is, ‘One
Water’ approach is needed.
→ Holistic water management system in urban areas is needed for sustainable future.
→ With climate change and population growth leading to increased water use, new solutions have to be conceived for
better urban water management.
→ More people in different local contexts need to be made aware of challenges.
→ There are changes required in institutions like local departments that play crucial role. It is essential that holistic and
systemic solutions are implemented to solve water issues.
→ Integrated urban water management system.
Note:
 Jal Jeevan Mission (JJM) / Jal Shakti Abhiyan [2019]:
→ What:
 supply of 55 litres of water per person per day to every rural household through Functional Household Tap
Connections (FHTC) by 2024. Ministry of Jal Shakti.
→ Objective:
 provide piped water supply (Har Ghar Jal) to all rural households by 2024 through Functional Household Tap
Connections (FHTC). create local infrastructure - for reuse in agriculture etc: rainwater harvesting; groundwater
recharge; management of household waste water.
→ Function:
 Ensuring functionality of existing water supply systems and water connections. Water quality monitoring and
testing. Coordinated use of surface water and groundwater. sustainable agriculture. Drinking water source
augmentation. Drinking water supply system. Grey water treatment and its reuse. Providing functional tap
connection to: Schools, Anganwadi centres, Gram Panchayat buildings, Health centres, wellness centres,
community buildings. Technological interventions for removal of contaminants. Prioritizing FHTCs in: quality
affected areas / villages; drought prone; desert areas; Sansad Adarsh Gram Yojana (SAGY) villages.
→ Feature:
 Piped water supply to all rural households by 2024. Integrated demand and supply side management of water
at local level. Convergence with other Central and State govt. schemes. Creation of local infrastructure for
rainwater harvesting. Groundwater recharge and management of household waste water for reuse in
agriculture.
 Prioritizing provision of FHTCs in quality affected areas, villages in drought prone and desert areas, Sansad
Adarsh Gram Yojana (SAGY) villages, etc. Providing functional tap connection to Schools, Anganwadi centres,
Gram Panchayat buildings, Health centres, wellness centres, community buildings. Technological interventions
for removal of contaminants where water quality is issue.
 Har Ghar Jal-certified process: After every household in village is connected with tap water, Gram Sabha passes
resolution that no single household is left out. Only after every village certifies, that State can be declared ‘Har
Ghar Jal’ certified State.
→ Implementation:
 Under guiding principles of Gandhiji - Gram Swaraj, JJM is to be implemented by community approach /locals -
Local village community / Gram Panchayats or sub-committee – involving women also. JJM looks to create jan
andolan for water, thereby making it everyone’s priority. JJM mission is very strongly focused on Jan bhagidari,
or community engagement which is seen as very important pillar of JJM project.
→ Funding:
 Funding is demand-driven. Centre and States in: 90:10 for Himalayan and North-Eastern States; 50:50 for other
States; 100% for UTs.
→ Need:
 India has 16% of world population, but only 4% of freshwater resources. Challenges of India about providing
drinking water: Depleting groundwater level; Over-exploitation of water; deteriorating water quality; climate
change, etc.
→ Component:
 extensive information; Education; Communication; Har Ghar, Nal Se Jal scheme [2019].
→ Performance:
 By 2022, above 52% of rural households are connected with tap water.
 3 States have declared that they have completed JJM project: Haryana, Telangana, Goa. As on now, tap water
supply is provided to about 75% schools, 70% anganwadi centres. 50% of rural households in India are now
covered under JJM. At time of launch of JJM in 2019, only 3.23 Crore households i.e. 17% of rural population
had access to drinking water through taps.
Certain State and Union Territories such as Gujarat, Goa, Telangana, AN Islands, D&N Haveli, Daman &
Diu, Puducherry, Haryana have already achieved 100% household connections. Punjab, Gujarat, Himachal

Page 389 of 719

 Pradesh, Bihar have coverage of more than 90% and are progressing fast towards attaining status of ‘Har Ghar
Jal (water in every household)’.
 In 2022, PM Modi said 10 crore rural households in India have piped water connections. Modi congratulated
Goa government for becoming 1st State to be ‘Har Ghar Jal-certified’, which means that every household in Goa
State had piped water connection. He said that Union Territories of Dadra Nagar Haveli, Daman and Diu too had
achieved this feat.
 JJM shifted focus from habitation to household; emphasis on community ownership, women, children and
weaker sections; Integrated water management; use of technology such as geo-tagging, dashboard-based
monitoring etc.
 Case study of JJM success story:
• Each of 5,644 residents of Pimpalghar-Ranjnoli village, situated in industrial belt of Thane (Maharashtra) has
to access to 55 litres of water every day. Villagers used funds under JJM to ensure that all 842 families in
village get tap water connections. Village has effectively ensured that residents pay user charges for tap
water. Maharashtra is one of leading States in India in implementing JJM (71% of households in MH have
access to tap connection; national average is just under 52%).
→ Significance:
 India has 16% of world population, but only 4% of freshwater resources. Urgent requirement of water
conservation in country because of decreasing amount of groundwater level. Therefore, JJM becomes important
as it focuses on demand and supply management of water at local level.
 Har Ghar, Nal Se Jal scheme [2019]:
→ What:
 component of JJM.
→ Aim:
 To provide piped drinking water to every rural home by 2024
→ Need:
 According to a 2018 NITI Aayog report, 600 million Indians face high to extreme water stress and about two lakh
people die every year due to inadequate access to safe water. By 2030, the country’s water demand is projected
to be twice the available supply, implying severe water scarcity for hundreds of millions of people and an
eventual ~6% loss in the country’s GDP. Studies also show that 84% of rural homes have no access to piped
water, with more than 70% of the country’s water contaminated.
→ Implementation:
 nodal Agency - Ministry of Jal Shakti. It is based on unique model where Paani Samitis (water committee)
comprising villagers will decide what they will pay for water they consume. Tariff Paani Samitis fix will not be
same for everyone in village. Those who have large households will pay more, while poor households or
households where there is no earning member, will be exempted.
→ How is village certified as Har Ghar Jal?
 Village can be counted as village with Har Ghar Jal only after formal resolution by Gram Panchayat, with video
recording of that session which has to be uploaded on portal.
 JJM is managed by paani samitis to plan, implement, manage, operate and maintain village water supply systems.
 Bihar’s similar scheme for providing water to households - Har Ghar Nal Ka Jal.
 World Water Day:
→ observed on 22 March. every year. coordinated by UN-Water (UN’s inter-agency collaboration mechanism
for all freshwater related issues) in collaboration with governments, partners. UN World Water
Development Report is released by UN every year around World Water Day. 2022 Theme: “Groundwater,
making invisible visible”.
 Terrestrial Water Storage (TWS):
→ sum of all water on land surface and in subsurface, ie surface water, soil moisture, snow and ice, ground
water.
 2021 WMO report on Terrestrial Water Storage (TWS) loss:
→ TWS dropped. biggest losses – Greenland, Antarctica, India. Many highly populated, lower latitude
locations also experienced TWS losses.
→ India:
 topmost hotspot of TWS loss. India recorded highest loss in TWS [if loss of water storage in Antarctica
and Greenland is excluded]. Northern part of India experienced maximum loss within India.
 Public Trust Doctrine:
→ sovereign / state, holds trust of people to manage resources for benefit of people.
 Senegal-Mauritanian Aquifer Basin (SMAB):
→ largest basin in Atlantic margin of NW Africa. Million inhabitants of region are dependent on it for drinking water,
other needs.
 2021 joint declaration on Senegal-Mauritanian Aquifer Basin (SMAB):
→ What:

Page 390 of 719

  4 West African countries – Mauritania, Senegal, Gambia, Guinea Bissau agreed to establish legal and institutional
framework for cooperation on SMAB. 1st such mechanism in West Africa. It would pave way for strengthened
collaboration on shared groundwater resources worldwide.
→ Background:
 Senegal, upon accession to UNECE Water Convention, requested for such declaration.
 Bawris:
→ one old method of rain water storage. deep wells dug in ground which have steps to reach water stored. help in
storage of water for longer time as evaporation of water from deep well is very less.
 National Water Awards (NWA) [2018]:
→ NWA is given for exemplary work in field of water resource management. 1st NWA was launched in 2018, by Jal Shakti
Ministry. It aims to fulfil government’s vision of ‘Jal Samridh Bharat’. by Department of Water Resources, River
Development & Ganga Rejuvenation, Ministry of Jal Shakti.
→ Categories:
 Best State, Best District, Best School, Best Newspaper, Best NGO, Best Industry etc.
 ‘One Water’ approach:
→ What:
 It means All Water is One Water i.e. drinking water, wastewater, recycled water, stormwater, groundwater,
surface water etc. are all one water. ‘One Water’ is recognition that all water has value, regardless of its source
and that water can be used, recycled and reused. It includes managing that source in integrated, inclusive and
sustainable manner by including community, business leaders, industries, farmers, conservationists,
policymakers, academics and others for ecological and economic benefits. This new water management
approach, is also referred to as Integrated Water Resources Management (IWRM).
IWRM / One Water is one integrated planning and implementation approach to managing finite water
resources for long-term resilience and reliability meeting both community and ecosystem needs. This approach
also recognises that all water has value and by considering potential of every form of water, none of them should
be treated as waste product. It recognizes that all urban water supplies (surface water, groundwater,
stormwater, waste water, etc.) are connected water resources.
→ Need:
 Failure to value water in all its forms is considered one prime cause of mismanagement of water (UN World
Water Development Report 2021, published by UNESCO on behalf of UN-Water).
→ Objective:
 Reliable, secure, clean water supplies. Aquifer recharge. Flood protection. Minimising environmental pollution.
Efficient use and reuse of natural resources. Resiliency to climate. Long-term sustainability. Equity, affordability
and accessibility to safe drinking water. Economic growth and prosperity.
→ Characteristic:
 Mindset that all water has value — water resources in our ecosystems, drinking water, wastewater, stormwater,
etc.
 One multi-faceted approach meaning that our water-related investments should provide economic,
environmental, and societal returns.
 Utilising watershed-scale thinking and action that respects and responds to natural ecosystem, geology, and
hydrology of area.
 Partnerships and inclusion in recognising that real progress and achievements will only be made when all
stakeholders come forward and together will take decision.
→ Significance:
 ‘One Water’ approach is key to combating urban challenges, managing resources and that shift is needed from
single-minded, linear water management to multi-dimensional integrated water management technique
→ Case study:
 Singapore: It is working towards becoming zero waste nation by reducing its consumption of water, materials,
and reusing and recycling them to give them 2 nd lease of life. It has been following OWA for decades now.
 Los Angeles (USA): One Water Los Angeles formulated one LA 2040 Plan through one “Three legged stool
approach” that ensures water quality improvement, water supply augmentation, and flood risk mitigation, using
recycling and reuse.
→ Conventional water management approach vs OWA:
 OWA / Integrated Water Resource Management is superior to conventional water management approach:
•
{Conventional Water Management Approach} {OWA / IWRM}
Drinking water, wastewater, and stormwater are All water systems, regardless of their source, are
managed separately. managed in connected way and given equal worth.
One-way route from supply to use, treatment, and Water is recycled and reused several times.
disposal.

Page 391 of 719

 Use of Stormwater not considered. Stormwater is utilised as valuable resource to fight
against water scarcity, recharge groundwater, and
support natural vegetation.
Grey infrastructure in conventional water Mix of grey and green infrastructure that form
management. hybrid system.
Collaboration is need-based. Active collaborations with all stakeholders,
including communities.
 AIM-ICDK Water Innovation Challenge:
→ Atal Innovation Mission, NITI Aayog (AIM-NITI Aayog) collaborated with Innovation Center Denmark (ICDK), Denmark
Embassy in India, and Denmark Technical University (DTU) to prepare Indian participation for Global Next Generation
Water Action (NGWA) program hosted by DTU. Indian participants participated in global Next Generation Water
Action program and engaged with young talents from leading universities and innovation hubs of 5 countries (India,
Denmark, Ghana, USA, Brazil). This program helped innovators to build their skills and apply their technical
disciplines, innovation capacity, and solutions to challenge and catalyze water solutions towards smart livable cities.
 “Swachh Sujal Pradesh”:
→ This certification is provided for ensuring 3 things:
 Safe and secure drinking water supply;
 ODF+ status;
 awareness about cleanliness and convergence of schemes.
→ In 2022, Jal Shakti Minister Gajendra Singh Shekhawat declared / certified AN Islands as India's 1st Swachh Sujal
Pradesh. [All villages of AN islands have received Har Ghar Jal Certification].
 Pey Jal Survekshan:
→ MoHUA will rank cities (covered under AMRUT) on quality of drinking water, water utility services, sewer
connections, used water utility services, etc.
 Integrated Urban Water Management (IUWM) System:
→ What:
 IUWM is practice of managing freshwater, wastewater, and storm water as components of basin-wide
management plan. It builds on existing water supply and sanitation considerations within urban settlement by
incorporating urban water management within scope of entire river basin. IUWM is commonly seen as one
strategy for achieving goals of Water Sensitive Urban Design.
IUWM is one process, which ensures water supply, used water management, sanitation and
stormwater management can be planned in line with economic development and land use.
→ Aim:
 IUWM seeks to change impact of urban development on natural water cycle, based on premise that by managing
urban water cycle as whole; more efficient use of resources can be achieved providing not only economic
benefits but also improved social and environmental outcomes.
→ How:
 One approach is to establish inner, urban, water cycle loop through implementation of reuse strategies.
Developing this urban water cycle loop requires understanding both of natural, pre-development, water balance
and post-development water balance. Accounting for flows in pre- and post-development systems is one
important step toward limiting urban impacts on natural water cycle.
 Collaborative action:
• Collaborative action is one of leading principles of IUWM. It focuses on collaborative approach involving all
stakeholders. While effective legislation will help guide local authorities, engaging local communities will
lead to faster solutions in water management. When there is clear coordination between all stakeholders,
it is easier to define priorities, take action, implement changes and take accountability.
 Shift in perception of water:
• Shift in perception must view water in connection with other urban sectors. It is essential to understand
how water is inseparable in its connection to economic development, city infrastructure and land use.
Earlier, many solutions focused solely on seeing water as independent sector, but now perception has
shifted and it is necessary to view interdependence with other sectors. Once water situation is gauged, it
will be easier for urban local bodies to link city’s development plans with water management process.
 Understanding water as resource:
• To understand water as resource, we need to realise water is used for different purposes like domestic use,
industrial use, freshwater, agricultural use and wastewater. This means it cannot be just seen as end product
for consumers but rather as resource for various end goals. Once all sources are clearly defined, it will be
easier to treat different kinds of water based on agricultural, industrial and environmental purposes. IUWM
ensures water management can be done based on quality and quantity of water targeted toward specific
uses.
 Customised solutions for different cities:

Page 392 of 719

 • Different cities also need customised solutions. Since IUWM focuses on specific contexts and local
requirements, it prioritises rights-based solution approach over one-size-fits-all approach. Conventional
methods did not focus on stakeholder engagement, however, IUWM’s integrated system brings in healthy
coordination between all stakeholders.
→ Challenge:
 IUWM has proven to be successful practice, but budget constraints, inadequate guidance from authorities and
lack of awareness have limited implementation of this solution. However, recent policies by GOI can help pave
way for State-wise planned implementation of IUWM.
→ Initiative:
 GOI started initiatives by implementing Swachh Bharat Mission (SBM) for inclusive sanitation solutions, and Jal
Jeevan Mission for ensuring piped water supply.
 GOI allows reuse of water based on circular economy principles.
→ Significance:
 This holistic process makes coordination among water departments easier at local level. It also helps cities adapt
to climate changes and manage water supply more efficiently.
 Water for All: IUWM prioritises access to water for most vulnerable communities.
 Adopting IUWM will also help us tackle water scarcity, address public health risks and make cities climate
resilient. It is one-stop solution to ensure good health and clean water for all.
Value Addition:
 United Nations Economic Commission for Europe (UNECE) Multilateral Environmental Agreements (MEA):
→ UNECE negotiated 5 environmental conventions (MEAs):
 Convention on Long-range Transboundary Air Pollution
 Convention on Environmental Impact Assessment in Transboundary Context
 Convention on Protection and Use of Transboundary Watercourses and International Lakes, 1992 (Water
Convention):
• unique legally binding instrument
• promotes sustainable management of shared water resources, implementation of SDGs, prevention of
conflicts, promotion of peace and regional integration.
• Its protocols:
 Protocol on Water and Health, 1999
 ….
• Implementation:
 Water Convention requires Parties to prevent, control, reduce transboundary impact, use
transboundary waters in reasonable and equitable way and ensure their sustainable management.
 Parties bordering same transboundary waters have to cooperate by entering into specific agreements
and establishing joint bodies.
 As framework agreement, Convention does not replace bilateral and multilateral agreements for
specific basins or aquifers; instead, it fosters their establishment and implementation, further
development.
• India – not signatory.
 Convention on Transboundary Effects of Industrial Accidents
 Convention on Access to Information, Public Participation in Decision-making and Access to Justice in
Environmental Matters
 Uttarakhand:
→ 1 st State to introduce Gross Environment Product (GEP) — forest, air, water quality and quantity, soil quality
and quantity to be measured, assigned monetary value.
 Water privatization:
→ What:
 when private corporations buy or operate public water utilities
→ Experts suggest it as solution to municipal budget problems and aging water systems.
Mains Link:
 Examine the new challenges and strategies on water and its management on account of climate change. (15M)
 The Jal Jeevan Mission will be a major step towards improving our people’s ease of living and meeting their
aspirations of a New India. Analyse. (250 words)
 Analyse the availability and usage of water in India. In the context of ‘One Water Approch’, discuss the measures
that are needed for effective management of water in India. (250 Words)
 Do you think there is urgent need for water management in India to undergo a revolution. Substantiate your
arguments. 10M

NUCLEAR FUSION
News:

Page 393 of 719

  2020:
→ South Korea’s KSTAR reactor sets new record by maintaining among hottest plasma temperature.
 2021:
→ China’s Experimental Advanced Superconducting Tokamak (EAST) experiment , sets new world record by
achieving hottest plasma temperature and for longer durations.
→ Physicists in California, using lasers, generated huge amount of energy from fusion.
→ Chinese scientist claims China creates successfully - Artificial sun / Fake Sun / EAST.
 2022:
→ Scientists in UK [Joint European Torus (JET) facility using tokamak machine] say they have achieved new
milestone in producing nuclear fusion energy, or imitating way energy is produced in Sun.
 How:
• At Joint European Torus (JET) facility [JET site is largest operational one of its kind in world.]
• by using tokamak machine
• Deuterium and tritium are heated to temperatures 10 times hotter than centre of sun to create plasma,
using superconductor electromagnets as it spins around, fuses and releases tremendous energy as heat.
 Importance:
• It is major boost for ITER (larger and more advanced version of JET).
→ KSTAR attains temperatures over 100 million degrees Celsius (nearly 7 times core of Sun) in reaction that
lasted for about 30 seconds. This reaction achieved simultaneous sustainability of heat & plasma stability
for 30 seconds. This development not only sets new world record but also brings world closer to realisation
and use of nuclear fusion energy. This promises viable fusion reactor that can be scaled up in future.
About:
 What:
→ In tremendous heat, pressure and gravity at core of interstellar bodies, hydroge n nuclei collide and fuse
into heavier helium atoms, and tremendous energy is released during process. Fusion is energy source of
stars like our Sun. 10 times hotter than Sun.
Nuclear fusion is one reaction through which two or more light nuclei collide to form heavier nucleus.
Nuclear fusion process occurs in elements that have low atomic number, such as Hydrogen. Nuclear Fusion
is opposite of nuclear fission reaction, in which heavy elements diffuse and form lighter elements.
 3 Conditions required to achieve fusion in laboratory:
→ Very high temperature (in terms of 150 million degree Celsius).
→ Sufficient plasma particle density (to increase collisions).
→ Sufficient confinement time (to hold plasma, which expands).
 Initiative:
→ International Thermonuclear Experimental Reactor (ITER).
→ China’s Artificial Sun.
→ Joint European Torus (JET) facility (located in UK).
 Significance:
→ potential energy of future, particularly because it produces little waste, no greenhouse gases (GHG).
→ low carbon
→ safer than how nuclear energy is now produced
→ about 100% efficiency.
→ 1 kg of fusion fuel contains about 10 million times as much energy as 1 kg of coal, oil or gas.
 Fusion better than fission:
→ generates less nuclear waste, than fission [though fusion is more difficult process than fission]
→ Unlike fission, fusion does not emit greenhouse gases (GHG)
→ Unlike fission, safer process with lower risk of accidents.
→ Once mastered, nuclear fusion could potentially provide unlimited clean energy and at very low costs.
Note:
 2021 California Fusion experiment:
→ What:
 Using lasers, Physicists generated huge amount of energy from nuclear fusion.
 scientists used isotopes of hydrogen, giving rise to Helium.
 Tokamak:
→ What:
 Tokamak is device which uses powerful magnetic field to confine plasma in torus shape.
experimental machine designed to harness energy of fusion. 1st developed by Soviet Union in late
1960s.
→ Example:
 International Thermonuclear Experimental Reactor (ITER).
 Artificial Sun / EAST / Fake Sun.
Page 394 of 719
 → Countries:
 Chin. South Korea. ..
 International Thermonuclear Experimental Reactor ( ITER):
→ What:
 fusion research mega-project. built in France. international nuclear fusion reactor – research and
experimental tokamak. world’s largest magnetic plasma experiment i.e. world’s largest tokamak. It aims
to build world’s largest tokamak to enable commercial fusion reaction.
→ Goal:
 To demonstrate scientific and technological feasibility of fusion energy for peaceful use.
→ Function:
 Produce 500 MW of fusion power. Demonstrate integrated operation of technologies for fusion power
plant. Achieve deuterium-tritium plasma in which reaction is sustained through internal heating. Test
tritium breeding. Demonstrate safety characteristics of fusion device.
→ Countries:
 US. EU. Russia. Japan. South Korea. China. India.
→ Significance:
 1st fusion reactor to produce fusion energy. 1st fusion reactor to maintain fusion for long periods of
time. Evaluating safety characteristics of fusion reactor. It will be world’s largest nuclear fusion reactor.
 Artificial Sun / EAST / Fake Sun:
→ What:
 also known as HL-2M Tokamak reactor. China. Experimental nuclear fusion reactor [superheated to
temperature many times hotter than sun]. EAST is part of International Thermonuclear Experimental Reactor
(ITER) facility. It replicates nuclear fusion process carried out by Sun.
→ Feature:
 It is developed through reactor, with help of nuclear fusion (hydrogen fuse into helium, plasma, magnetic fields).
powerful magnetic field fuse hot plasma. mimics energy generation process of Sun, stars.
→ How:
 Scientists focused many laser beams onto one tiny spot and created mega blast of energy. Created energy lasted
for very short time – just 100 trillionths of second. Scientists used 2 isotopes of hydrogen, giving rise to helium.
→ Mechanism:
 Artifical Sun replicates nuclear fusion process carried out by sun and stars. Tremendous heat and pressure are
applied on hydrogen atoms so that they fuse together. Nuclei of deuterium and tritium — both found in
hydrogen — are fused together to create one helium nucleus, one neutron and whole lot of energy. Here, fuel
is heated to million degree temperatures so that it forms hot plasma “soup” of subatomic particles. With help
of strong magnetic field, said plasma is kept away from walls of reactor to ensure it does not cool down and lose
its potential to generate large amounts of energy. Said plasma is confined for long durations for fusion to take
place.
→ Significance:
 Temperature produced by EAST is nearly 7 times that of Sun’s core. produces enormous heat and energy. China’s
quest to unlock clean and limitless energy, with minimal waste products. May eventually help create source of
near-unlimited clean energy to power cities.
 Korea Superconducting Tokamak Advanced Research (KSTAR):
→ One nuclear fusion reactor developed by researchers at Seoul National University (SNU) in South Korea.
→ In 2020, KSTAR reactor set new record by maintaining among hottest plasma temperature. In 2022, KSTAR
attained temperatures over 100 million degrees Celsius in reaction that lasted for about 30 seconds.
Mains Link:
 Describe the significance of artificial sun being developed by China.

BILATERAL TRADE / CLEARING TRADE

News:
 2020:
→ RCEP gets adopted i.e. institutionalisation of RCEP. [RCEP will come into effect in 2022].
 2021:
→ India and Australia are fast-tracking negotiation regarding bilateral Comprehensive Economic Cooperation
Agreement (CECA).
→ India participates in EEF 2021.
 2022:
→ RCEP comes into effect in Jan, 2022.
→ South Korea says it regrets India’s absence from RCEP and hopes to see New Delhi rejoin RCEP agreement.
→ Interim trade agreement between India and Australia is unlikely to include items that both sides consider “sensitive”.
This Indian and Australian “interim agreement” (early harvest deal) is expected to be ready soon.

Page 395 of 719

 → India and UAE sign CEPA.
→ India – Canada agree to re-launch CEPA negotiations to unlock full potential of bilateral trade. They are also
considering Interim Agreement or Early Progress Trade Agreement (EPTA) that could bring early commercial gains to
both countries.
 Need: This trade agreement would help in expanding bilateral trade in goods and services through unlocking
potentials across sectors.
→ India and UAE activate CEPA.
→ USA sees India’s participation in IPEF [2022] as “very important”. Therefore, Washington is designing this framework
to prioritise “flexibility and inclusion”, under which, participating countries can join IPEF without necessarily joining
all 4 pillars of IPEF — pick-and-choose arrangement that could make India more open to coming on board.
→ Indo-Pacific Economic Framework (IPEF) for Prosperity ministerial meet held. India was one participant and India
joins 3 out of 4 pillars (Supply chain; Tax and anti-corruption; Clean energy) but didn’t join “Fair and resilient trade”
pillar. Union Minister Shri Piyush Goyal says India did not join this 4th pillar because contours of framework -
particularly on commitments required on environment, labour, digital trade, public procurement — are still
emerging.
→ Russia hosts 7th EEF Vladivostok.
About:
 What:
→ Trade exclusively between two states, particularly, barter trade based on bilateral deals between
governments, and without using hard currency for payment.
 Aim:
→ Bilateral trade agreements often aim to keep trade deficits at minimum by keeping clearing account where
deficit would accumulate.
 Comprehensive Economic Cooperation Agreement (CECA):
→ CECA involves only tariff reduction / elimination in phased manner on li sted / all items, except negative
list and tariff rate quota (TRQ) items. Usually CECA is signed 1st with country and after that negotiations may start
for CEPA.
 Comprehensive Economic Partnership Agreement (CEPA):
→ One kind of free trade pact. Like CECA, CEPA also involves tariff reduction / elimination in phased manner
on listed / all items, except negative list and tariff rate quota (TRQ) items. But, CEPA also covers trade in
services, investment, other areas of economic partnership. So, CEPA has wider co verage that CECA. CEPA’s
partnership agreements or cooperation agreements are more comprehensive than F ree Trade Agreements
(FTA). CEPA also looks into regulatory aspect of trade and encompasses agreement covering regulatory
issues. Usually CECA is signed 1 st with country and after that negotiations may start for CEPA.
Note:
 Bilateral Trade [India – Canada]:
→ India-Canada Comprehensive Economic Partnership Agreement (CEPA):
 In 2008, India-Canada CEO Round Table recommended that India and Canada would benefit enormously from
CEPA by elimination of tariffs on substantial majority of bilateral trade. This CEPA would cover trade in goods,
trade in services, rules of origin, sanitary and phytosanitary measures, technical barriers to trade, other areas of
economic cooperation.
 Bilateral Trade [India – Australia]:
→ In 2020, India was Australia’s 7 th largest trading partner, 6 th largest export destination (driven by coal,
international education). In FY21, India’s exports to Australia is about USD 4 billion. In FY21, India’s imports
from Australia is about USD 8 billion.
→ Indian exports to Australia:
 petroleum products; medicines; polished diamonds; gold jewellery; apparel; services like travel, telecom,
computer, government services, financial services; ….
→ Indian imports from Australia:
 Coal; LNG; Alumina; non-monetary gold; services like education, personal travel.
→ Significance of proposed India – Australia CECA deal for India:
 This agreement will mark beginning of FTAs that India is aiming to achieve in coming years. Apart from Australia,
India is in talks to conclude similar FTAs and early harvest deals with Israel, Canada, EU, UAE. Gulf Cooperation
Council (GCC) has also shown interest in concluding FTA with India.
 Eastern Economic Forum (EEF) [2015]:
→ What:
 One key international platform for establishing and strengthening ties within Russian and global investment
communities, and for comprehensive expert evaluation of economic potential of Russian Far East, in terms of
investment opportunities RFE offers, and business conditions within advanced SEZs.
It was established by decree of President of Russian Federation Vladimir Putin in 2015 to support
economic development of Russia’s Far East and to expand international cooperation in Asia-Pacific region.

Page 396 of 719

 One international forum held each year in Vladivostok, Russia, for purpose of encouraging foreign investment
in Russian Far East. established by Russia. takes place each year in Vladivostok city, Russia. One platform for
entrepreneurs to expand their businesses into Russia’s Far East (RFE).
 platform for discussion of key issues in:
• world economy. regional integration. development of new industrial and technological sectors. global
challenges facing Russia and other nations.
→ Aim:
 EEF supports economic development of Russia’s Far East. to expand international cooperation in Asia-Pacific
region.
→ Participants:
 business dialogues. leading partner countries in Asia-Pacific region. ASEAN (key integration organization of
dynamically developing nations in Southeast Asia).
→ Feature:
 It focuses on: Infrastructure, Transportation projects, Mineral excavations, Construction, Industry, Agriculture.
 EEF aims to increase FDI in RFE.
 It also aims to harness rich natural resources such as fish, oil, natural gas, wood, diamonds and other minerals.
 Russian government also aims to connect Russia to Asian trading route.
→ Significance:
 EEF has emerged as international platform for discussing political, economic and cultural ties between Russia
and Asia Pacific.
→ India’s and EEF:
 Friendly and historical ties with Russia. India is key customer of Russian arms industry. India entered into joint
venture with Russia to manufacture legendary Kalashnikov assault rifles in India. Russia sold S-400 triumf
advanced air defence system to India. India is interested in expanding trade with Russia. India is also interested
in exploration of hydrocarbon reserves along coast of Russia’s Far East.
 Balance between EEF and IPEF: India has not shied away from investing in Russia-initiated EEF despite current
international conditions (For example, India has given its confirmation and acceptance to 3 of 4 pillars in IPEF).
 Regional Comprehensive Economic Partnership (RCEP) [2020]:
→ What:
 Free Trade Agreement (FTA). Trade deal between ASEAN, China, Japan, South Korea, Australia, New Zealand
[ASEAN + 5]. Trade Partnership. mega trade bloc. world’s largest free trade zone in terms of trade volume.
→ Goal:
 Lower tariffs, duties (so that goods and services can flow freely among members). Open up trade in services
 promote investment. reducte costs, time. faciliation of intellectual property.
→ Members (15):
 10 ASEAN nations; Japan; South Korea; China; Australia; New Zealand.
→ Drawbacks:
 environmental protections not covered. labour rights not covered.
→ Questions:
 Lack of participation by United States allows Beijing to solidify its role as driver of economic growth in region.
Economic gains may take longer time to materialize. While big Asian economies will enjoy most of spoils, RCEP
may leave smaller countries within ASEAN at disadvantage, because RCEP doesn’t cover small countries’ major
industries. Least developed countries in Asia ― Cambodia, Laos, Myanmar ― currently benefit from inter-ASEAN
trade, which could be eroded by RCEP trade. Smaller ASEAN countries may also lose some of their benefits from
trade preference programs.
→ Significance:
 boost commerce among member-countries that spread across Asia-Pacific region. about 30% of global GDP.
about 30% of global trade. about 30 % of global population. China’s geopolitical ambitions in Asia-Pacific region.
common rules around trade, intellectual property, e-commerce and competition. no need to meet separate
requirements for each country. around 90% of trade tariffs within RCEP bloc will eventually be eliminated.
→ India:
 India participated in multiple rounds of RCEP discussions but chose to opt-out of this RCEP grouping.
 India withdrew from RCEP in 2019 largely because of concerns:
• RCEP would open up to Chinese goods amid already wide trade imbalance with China. failure of RCEP
agreement to adequately open up to services.
 Why India did not sign:
• Trade Deficit: India’s trade deficit with RCEP nations > dollar 100 billion, of which China alone accounts for
> dollar 50 billion. So, further relaxations under RCEP would enhance deficit.
• Services sector: This agreement does not adequately open up to services.

Page 397 of 719

 • Domestic interests: Negative effect on India’s domestic agricultural sector, industrial sector – esp. textiles,
dairy, and agriculture. Below goods would flood Indian markets and hurt dometic interests: Chinese goods;
New Zealand dairy products.
• Make in India: Detrimental to Make in India initiative.
• Rules of Origin: India’s proposal for specific Rules of Origin, to ensure non-abusal of RCEP trade pact by non-
partner countries, was not addressed.
• Ecommerce: Ecommerce concern was not addressed.
• Base year: India was worried about keeping 2014 as base year for tariff reductions.
 Why India’s presence is required in RCEP:
• India had crucial role to play in helping region build inclusive architecture at time of increasing
global instability. Rising U.S.-China tensions are deeply worrying for region with pandemic resulting
in heightened tension.
 Implications of India not joining RCEP:
• May impact India’s bilateral trade with RCEP member nations (because RCEP would focus on increasing
economic ties within itself). India could lose large market in RCEP. May impact Australia-India-Japan Indo-
Pacific network. Indian companies will not be able to showcase their strengths across larger markets
of RCEP.
 Indo-Pacific Economic Framework (IPEF) [2022]:
→ What:
 Economic initiative launched by USA President Joe Biden in 2022. This framework was launched with total of 14
participating founding member nations, with late entry of Fiji, 1st South Pacific Island to join, with open invitation
for other countries to join at any time. Biden described this initiative as "writing new rules for 21st century
economy", stating that agreement would make participant's economies "grow faster and fairer". USA’s one
trade-boosting initiative in Indo-Pacific region with 13 nations — Australia, Brunei, India, Indonesia, Japan,
Malaysia, New Zealand, Philippines, Singapore, South Korea, Thailand, Fiji, Vietnam — as partners.
It is US-led economic grouping of 14 countries in Indo-Pacific region, intended to counter Chinese
aggressive and non-transparent trade and economic policies.
→ Aim:
 To set regional standards for cooperation. To encourage regional economies to “decouple” from Chinese market
by leading them to alternative supply chains. It aims to define rules of trade among countries which belief in fair
play, transparency, and rules-based trading in future.
→ Members:
 4 QUAD countries, South Korea, New Zealand, Fiji, and 7 out of 10 members of ASEAN (Indonesia, Malaysia, …).
→ Feature:
 It includes some of ASEAN member states. IPEF is intended to be precursor for later negotiations, as it does not
include uniform lowering of tariffs. IPEF will not include market access commitments such as lowering tariff
barriers, because this agreement is “more of Administrative arrangement”. IPEF is viewed as reflecting US’
ambitions to expand ties with key Indo-Pacific economies by building supply chain that excludes China.
 4 themes / pillars:
• Fair and resilient trade (encompassing 7 subtopics, including labor, environmental, digital standards);
• Supply chain resilience;
• Infrastructure, clean energy, and decarbonization;
• Tax and anti-corruption.
→ Reactions:
 China criticized IPEF as attempt to further economic decoupling from China. China argued that IPEF and US Indo-
Pacific strategy as whole create divisions and incited confrontation and that such agreement would ultimately
be failure. Many analysts criticized lack of inclusion of Taiwan. Taiwan News called IPEF’s lack of inclusion as
"snub". Some say that Taiwan was excluded in order to appease key "fence-sitter" countries such as Indonesia
whose governments feared angering China. One former Malaysian Prime Minister criticized this grouping as
initiative intended to isolate China, saying many countries recognize that this is not economic grouping but it is
truly political grouping.
→ Issues:
 Dependence on China: Major ASEAN economies may continue to maintain close economic ties with China while
simultaneously establishing ties with USA, as they have done in past. Centrality of SEA: Major ASEAN economies
may be averse (oppose) to IPEF because it can dilute centrality in SE Asia. IPEF may become non-starter: Similar
to USA’s previous initiatives [Blue Dot Network, Build Back Better World (B3W) Initiative] that made little
headway there is fear IPEF may also become non-starter. Issues with Taxation: Obtaining one common taxation
framework may be issue. Lack of common grounds for countries: As IPEF is not FTA; nor will it discuss tariff
reductions or increasing market access, raising questions about its utility. Also, its 4 pillars are somewhat
confusing.
→ Significance:

Page 398 of 719

  USA says that this framework constitutes most significant international economic engagement that USA has ever
had in Indo-Pacific region. Analysts have compared IPEF to Trans-Pacific Partnership which USA withdrew from
in 2017. IPEF aims to set regional standards for cooperation, and includes some ASEAN member states.
represents 40% of world GDP. IPEF is US’s answer to questions about USA’ economic commitment to vital Indo-
Pacific region. IPEF is created to encourage regional economies to “decouple” from Chinese market by leading
them to alternative supply chains. Countering China: Since China is not member of IPEF group. Economic
Cooperation & Integration: India may try to get trade deals which it lost out on while opting out of RCEP.
Opportunity for India: It will bolster case for Indo-Pacific goals of solidarity and maintaining rule of law.
→ India:
 Member. Why India joined IPEF?
• Being part of multi-lateral forum to present India’s case: Especially since global organizations like G20 may
not achieve anything of systemic significance for India. 2022 Ukraine war has already created rift between
USa and West-Europe with both Russia-China. Advantages over China: India is facing ongoing military
stalemate with China on Indo-Sino Border.
• Ideal opportunity for India to act in region without being part of China-led RCEP or Comprehensive and
Progressive Agreement for Trans-Pacific Partnership.
• Supply Chains: IPEF will help in disengaging from supply chains that are dependent on China and will also
make India part of global supply chain network.
• New sources of raw materials and other essential products in IPEF will further reduce India’s reliance on
China for raw materials.
→ Way Forward:
 Learn from Japan: Japan has taken practical steps. It has become member of RCEP and IPEF, keeping its trading
interests in mind. India too should have been member of RCEP; Establish Common Standards: Such as cover
labour rights, environmental standards, protection of IP rights and rules covering digital economy; Streamline
taxation issue between different countries: This would add to India’s attractiveness as trading partner and as
destination for investment, especially in new supply chains; Addressing tech-related issues: Solving issues of
transparency, requirements of fair competition and ownership & localization of personal data; Simplifying trade
negotiations: Considering complex trade negotiation process.
→ IPEF vs RCEP:
 According to some experts, IPEF has military ramifications, but RCEP does not. IPEF would "outweigh" RCEP in
both population and GDP. Only RCEP members not included in IPEF are China, Myanmar, Cambodia, Laos; while
non-RCEP members are USA, India, Fiji.
 China has no bilateral agreement with Japan (China’s 3rd largest trading partner). China has only limited deal with South
Korea (China’s 5th largest trading partner).
 Far East:
→ East + Southeast Asia + Russian Far East.
 Russian Far East:
→ easternmost part of Russia. borders 2 oceans - Pacific and Arctic.
→ rich in natural resources:
 coal reserves. hydro-engineering resources. Forests. Diamonds. Tin. Gold. Tungsten. Fish. Seafood.
→ Investors in EEF:
 China:
• China is biggest investor in RFE region as it sees potential in promoting BRI and Polar Sea Route in RFE.
China’s investments in region account for 90% of total investments. China is also looking to develop its
Heilongjiang province which connects with RFE.
 South Korea:
• It has invested in Shipbuilding projects, Manufacturing of electrical equipment, Gas-liquefying plants,
Agricultural production and fisheries.
 Japan:
• It has identified 8 areas of economic cooperation and pushed private businesses to invest in development
of RFE.
 India:
• India is keen in: cooperation in energy, pharmaceuticals, maritime connectivity, healthcare, tourism,
diamond industry, Arctic.
• In 2019, India also offered USD 1 billion line of credit to develop infrastructure in RFE region.
Mains Link:
 The formation of the Indo-Pacific Economic Framework for Prosperity (IPEF) holds good potential for India with respect
to economic growth and integration but India must be careful of the pitfalls it may pose in the future. Analyse. (15M)

VEHICLE / AUTOMOTIVE INDUSTRY / AUTOMOBILE INDUSTRY

News:

Page 399 of 719

  2021:
→ Assam government unveils electric vehicle (EV) policy for phasing out vehicles running on fossil fuels by 2030.
→ NITI Aayog launches Shoonya Campaign.
→ Green Tax approved by Union Ministry of Road Transport and Highways.
 2022:
→ Ministry of Road Transport and Highways issues notification to amend Central Motor Vehicles Rules, 1989, making
safety equipment mandatory for children between age of 9 months and 4 years.
→ Union Ministry for Road Transport and Highways inaugurates one pilot project for Hydrogen-based advanced Fuel
Cell Electric Vehicle (FCEV). Toyota Kirloskar Motor Pvt. Ltd. along with International Center for Automotive
Technology (ICAT) initiated this Pilot project to study and evaluate world’s most advanced FCEV Toyota Mirai which
runs on hydrogen, on Indian roads and climatic conditions.Aim is to spread awareness regarding Hydrogen, Fuel Cell
Electric Vehicle (FCEV) technology, and disseminate benefits to support hydrogen-based ecosystem.
→ Indian Sugar Mills Association (ISMA) calls for faster launch of flex -fuel vehicles (FFV) to achieve 20% of
ethanol blending.
→ Centre constitutes one expert panel to probe recent series of battery explosions in electric vehicles.
→ Minister of Road Transport and Highways says vehicles in India will get Star Ratings based on crash tests
(Bharat-NCAP).
→ BIS publishes Test Specifications for Lithium-ion (Li-ion) Traction Battery Packs and Systems (Performance Testing)
for Electric Vehicle.
→ NITI Aayog launches initiative — E-AMRIT mobile application and released report on Advanced Chemistry Cell Battery
Reuse and Recycling Market in India.
→ Union Minister of State (Independent Charge) Science & Technology Jitendra Singh launches India's 1st indigenously
developed Hydrogen Fuel Cell Bus developed by KPIT-CSIR in Pune.
→ Zero-Emission Vehicle Transition Council (ZEVTC) [2020] was in news.
→ PM Modi says ‘Amrit Kaal’ is one opportunity to achieve self-sufficiency in every sector and automobile sector is no
exception. PM Modi calls on automobile sector to achieve self-sufficiency, while also stressing on need to expedite
innovations for greener alternatives.
→ Minister for Road Transport and Highways Shri Nitin Gadkari launches Toyota’s 1st of its kind pilot project on Flexi-
Fuel Strong Hybrid Electric Vehicles (FFV-SHEV) in India which would run on 100% petrol as well as 20 to 100%
blended ethanol and electric power.
About:
 Authority:
→ Ministry of Road Transport & Highways is nodal ministry for regulation of automotive sector in India.
 Hybrid Vehicle:
→ What:
 It is one that uses 2 or more distinct types of power, such as submarines that use diesel when surfaced and
batteries when submerged. Other means to store energy include pressurized fluid in hydraulic hybrids.
The basic principle with hybrid vehicles is that the different motors work better at different speeds; the
electric motor is more efficient at producing torque, or turning power, and the combustion engine is better for
maintaining high speed than a typical electric motor. Switching from one to the other at the proper time while
speeding up yields a win-win in terms of energy efficiency, such that it translates into greater fuel efficiency.
→ Hybrid Electric Vehicle (HEV):
 What:
• It is a type of hybrid vehicle that combines a conventional internal combustion engine (ICE) system with an
electric propulsion system (hybrid vehicle drivetrain). The presence of the electric powertrain is intended
to achieve either better fuel economy than a conventional vehicle or better performance.
There is a variety of HEV types and the degree to which each function as an electric vehicle (EV) also
varies. The most common form of HEV is the hybrid electric car, although hybrid electric trucks (pickups and
tractors), buses, boats and aircraft also exist.
 Type:
• Full hybrid: It can use electric and combustion engine at the same time or independently.
• Mild hybrid: Starter generator linked to li-ion battery to run air conditioning or other devices.
• Strong hybrid: Batteries can be recharged completely by the engine or regenerative braking.
 Electric Vehicle (EV):
→ What:
 Vehicle that uses one or more electric motors for propulsion. It can be powered by collector system, with
electricity from extravehicular sources, or it can be powered autonomously by battery (sometimes charged by
solar panels, or by converting fuel to electricity using fuel cells or generator). EVs include road and rail vehicles,
surface and underwater vessels, electric aircraft and electric spacecraft. EV operates on electric motor instead
of internal combustion engine and has battery instead of fuel tank.
→ Tax:

Page 400 of 719

  Present GST rate on electric vehicles is 5%, which is lowest rate slab. [GST rates are prescribed based on
recommendations of GST Council].
→ In 2022, demand for electric vehicles increased. Reasons:
 Concern over climate change. Cost of Li-ion (Lithium-ion) battery technology has decreased. Governments
providing incentives to guide in transition. Private industry ramping up plans for capturing EV market. Vehicle
companies, battery manufacturers, material suppliers eyeing for market share.
→ Electric Vehicle Policy / EVPolicy:
 Target:
• India aims to switch 30% of private cars, 70% of commercial vehicles, 80% of two- and three-wheelers to EV
by year 2030.
 Policy Initiatives by GOI:
• National Electric Mobility Mission Plan (NEMMP), 2020.
• Faster Adoption and Manufacturing of Hybrid and Electric Vehicle (FAME).
• FAME II Amendment:
 Government significantly reduced price gap between petrol-powered two-wheelers and electric ones
by increasing subsidy rate for electric two-wheelers.
• PLI Scheme for Auto Sector:
 In 2021, Centre approved it to accelerate domestic manufacturing of electric and fuel cell vehicles and
drones in India.
• Vehicle Scrappage Policy:
 In 2021, Centre launched it to phase out unfit and polluting vehicles in environment-friendly manner.
• State Government EV Promotion Policies:
 State governments (Delhi, Gujarat, Goa, Maharashtra, Rajasthan) are also promoting faster adoption of
EVs in India [State level EV policies].
• Production Linked Incentive (PLI) scheme:
 In 2021, Government approved Production Linked Incentive (PLI) scheme for manufacturing of
Advanced Chemistry Cell (ACC) in India in order to bring down prices of battery in India. Drop in battery
price will result in cost reduction of electric vehicles.
• GST on electric vehicles reduced to 5%; GST on chargers / charging stations for electric vehicles also reduced
to 5%.
• Ministry of Road Transport & Highways (MoRTH) announced that battery-operated vehicles will be given
green license plates and be exempted from permit requirements.
• MoRTH advised States to waive road tax on EVs, which in turn will help reduce initial cost of EVs.
• Smart Cities Mission: Implementation of smart cities would also boost growth of electric vehicles.
 Significance:
• reduce its carbon emissions to net-zero by year 2070.
→ Challenge:
 Hurrying development of this complex technology without careful safeguards can lead to increasing safety
incidents, such as battery explosions in EVs as seen on Indian roads. India does not have lithium and cobalt
reserves, forcing India to import lithium-ion batteries from China, Japan. Indian electric vehicle (EV) market has
one of lowest penetration rates in world. Capital costs are high. payoff is uncertain. In 2021, Indian EV industry
has been hit hard due to rupee’s depreciation. Local production of inputs for EVs is low. High production costs,
limiting production. FAME India framework has been extended repeatedly. Uncertain policy environment. Lack
of supporting infrastructure.
→ Significance:
 EVs have low running costs because they have fewer moving parts. EVs are environmentally friendly. In India,
fuel cost for EV is approximately 80 paisa per kilometer. Contrast this with cost of petrol which is today more
than Rs. 100 per litre in Indian cities, or Rs. 7-8 per kilometer to operate petrol-based vehicle.
→ Way Forward:
 subsidizing batteries [batteries make up 50% of EV costs]. subsidy on EV two-wheelers [two-wheelers account
for max. of vehicles in India and consume most of fuels]. charging stations for EVs across States. Workplaces in
tech parks, Public bus depots, Multiplexes can be used as potential places where charging points could be
installed. In Bangalore, some malls have charging points in parking lots. attracting investment [make EV
investment to fall under Corporate Social Responsibility (CSR)]. Acquire lithium from Bolivia, Australia, Chile
[India needs raw material to make batteries for EV]. India needs auto industry’s active participation to ease
electric mobility transition. Auto and battery industries could collaborate to enhance customer awareness and
promote domestic manufacturing. Government needs to focus on phased manufacturing plan to promote EVs,
provide fiscal and non-fiscal incentives for phased manufacturing of EVs and batteries. developing entire EV
ecosystem. incentives for buyers. exemption of registration fees, road tax, parking fees for EVs. charging stations
should be given discount on their electricity bills.
 Flex-Fuel Vehicle / Flex Fuel Vehicle / Dual-Fuel Vehicle / Flexible-Fuel Vehicle (FFV):

Page 401 of 719

 → What:
 Flexible-fuel vehicle / dual-fuel vehicle / flex-fuel vehicle. alternative fuel vehicle with internal combustion
engine designed to run on more than one fuel, usually gasoline blended with either ethanol or methanol fuel,
and both fuels are stored in same common tank. modified version of vehicles that could run both on gasoline
and doped petrol with different ethanol blends.
→ Feature:
 It can run on all blends and also run-on unblended fuel. FFVs have compatible engines to run on more than 84%
ethanol blended petrol.
 FFV can run on Petrol as well as one blended Petro-ethanol mixture.
 FFV-Hybrid electric vehicles can run on a combination of 100% Petrol or Petrol + ethanol / methanol or Electric
power.
→ Benefits:
 reducing use of polluting fossil fuels, cutting down harmful emissions. Alternative fuel ethanol cost lesser than
petrol, and thus increases savings. reducing imports. logical extension of Ethanol Blended Petrol (EBP)
programme 2003.
 lower pollution, lower dependence on imported fossil fuel, increase farmers’ income.
→ Disadvantages /challenges:
 lower fuel efficiency. Customer acceptance because cost of ownership and Running cost (due to lower fuel
efficiency) are higher compared to petrol vehicles. Flex Fuel Engines cost more than that of petrol. Ethanolcools
combustion more than gasoline. Ethanol acts as solvent and could wipe out protective oil film inside Flex Fuel
engine and thereby causing wear and tear.
 Higher cost of flex fuel vehicle, corrosion risk from ethanol to engines, ethanol fuel efficiency is lower than petrol,
ethanol production consumes huge amount of water.
→ Extra:
 E85 (or flex fuel) is one gasoline-ethanol blend containing 51% to 83% ethanol. Flex fuel cars are already running
in Brazil, USA, Canada.
 Zero-Emission Vehicle (ZEV):
→ What:
 One vehicle that does not emit exhaust gas or other pollutants from onboard source of power.
→ Initiative:
 Zero-Emission Vehicle Transition Council (ZEVTC) [2020]:
• It is one global forum formed in 2020 to accelerate pace (enhancing political cooperation) of global
transition to Zero-Emission Vehicles (ZEVs). ZEVTC brings together ministers and representatives of some of
world’s largest automobile markets to collectively address key challenges in transition to ZEVs, to enable
faster, cheaper, and easier transition to EVs for all.
• India:
 On Transport Day at UNCCC COP26 in 2021, Glasgow, India, represented by NITI Aayog, participated in
4th ministerial dialogue of ZEVTC. Here, several stakeholders — automotive manufacturers,
governments, businesses, fleet owners, etc. — made ZEVTC declaration (COP26 declaration on
accelerating transition to 100% zero emission cars and vans) to actively work towards proliferation and
adoption of ZEVs.
→ Importance:
 Cars, vans, buses, trucks account for 21% of global anthropogenic CO2 emissions. Thus, ZEVs can reduce GHG
emissions by as much as 80% over vehicle’s life cycle.
 Vehicle Innovations:
→ Pushed by tough BS6 emission norms, automakers are offering mild and strong hybrid options in their vehicles and
using tech tweaks to stretch out every litre of petrol. Some Petrol tech innovations:
 Two Fuel Injectors Per Cylinder: In Maruti Suzuki’s new DualJet technology, two injectors are placed close to
engine inlet valves, which enables finer atomisation of fuel, resulting in more complete combustion and higher
efficiency.
 Gasoline Direct Injection: GDI is one sophisticated engine that injects fuel precisely and at very high pressure
directly into combustion chamber of engine. This leads to higher fuel efficiency, higher power output, and
significantly lower emissions.
 Turbocharged Petrol Engines: Turbocharger — one turbine that is powered by engine’s exhaust fuel to
subsequently power that additional compressed air into combustion chamber, resulting in extra combustion of
air-fuel mix. Result: these smaller turbocharged engines produce more energy than bigger engine while guzzling
less petrol.
 Strong Hybrid Tech: One hybrid system sometimes includes petrol engine that’s paired with electric motor and
Lithium-ion or Nickel-metal Hydride (NiMH) battery pack that allows automobile to be pushed in purely electrical
mode for short distances. Battery pack is recharged by engine, or by way of regenerative braking.
 Diesel Engine:

Page 402 of 719

 → What: Named after Rudolf Diesel, is one internal combustion engine in which ignition of fuel is caused by elevated
temperature of air in cylinder due to mechanical compression; thus, diesel engine is so-called compression-ignition
engine (CI engine). This contrasts with engines using spark plug-ignition of air-fuel mixture, such as petrol engine
(gasoline engine) or gas engine (using gaseous fuel like natural gas or LPG).
→ Working: In compression-ignited system, diesel fuel is injected into combustion chamber of engine and ignited by
high temperatures achieved when gas is compressed by engine piston. Because they use compressed air with no
spark plug for ignition process, diesel engines use 15%-20% less fuel compared to petrol engine vehicle.
→ Higher cost: Diesel engines entailed higher upfront costs, and their servicing and maintenance costs tended to be
more.
→ It produces much more toxic gases and so shifts towards petrol variants.
 EV Battery catch fire / battery explosions in electric vehicle (EVs):
→ Why:
 Batteries do store energy in small package and if energy is released in uncontrolled fashion, thermal event can
be significant. Battery fires, like other fires, occur due to convergence of 3 parts of “fire triangle”: heat, oxygen,
fuel. If adverse event such as short circuit occurs in battery, internal temperature can raise as anode and cathode
release their energy through short. Conventional Li-ion battery employs one graphite anode, one liquid
electrolyte, and one transition metal cathode. However, liquid electrolyte is flammable.
→ Prevention:
 Safety is must and is important consideration that battery and vehicle manufacturers can design for. Breaking
fire triangle. Battery cathodes are leading cause of heat release. Some cathodes, such as ones with lower nickel
content or moving to iron phosphate, can increase safety. Tightly controlled manufacturing (like adding Ceramic
layer) will prevent accidental shorts in cells. Protecting cell with robust thermal management is critical, especially
in India where ambient temperatures are high. Battery packs need to be protected from external penetration.
 Fuel Cell Electric Vehicle (FCEV) / Fuel cell vehicle (FCV):
→ Electric vehicle that uses fuel cell, sometimes in combination with small battery or supercapacitor, to power its
onboard electric motor. Fuel cells in vehicles generate electricity generally using oxygen from air and compressed
hydrogen. Most fuel cell vehicles are classified as zero-emissions vehicles that emit only water and heat. As compared
with internal combustion vehicles, hydrogen vehicles centralize pollutants at site of hydrogen production, where
hydrogen is typically derived from reformed natural gas.Transporting and storing hydrogen may also create
pollutants. It is powered by hydrogen. It is environment-friendly, as it has zero tail pipe emissions.Thus, it is one of
best zero-emission solutions.
 Initiative:
→ EV30@30 campaign, one global campaign of Clean Energy Ministerial (CEM), redefines ambition of CEM’s Electric
Vehicles Initiative (EVI), setting objective to reach 30% sales share for EVs by 2030.
→ Targets by India’s auto sector:
 Automobile industry has set target of becoming near 100% self-reliant in entire manufacturing value chain
by 2047. Auto sector aims to become one of 2 largest producers in every segment of automobiles in world.
Ambition to have 50,000 e-buses on India’s roads by 2030.
Note:
 National Electric Mobility Mission Plan (NEMMP) [2020]:
→ NEMMP 2020 is one National Mission document providing vision and roadmap for faster adoption of electric vehicles
and their manufacturing in India. As part of NEMMP 2020, Department of Heavy Industry formulated one scheme
viz. Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME India) Scheme in year 2015 to
promote manufacturing of electric and hybrid vehicle technology and to ensure sustainable growth of same. GOI
aims to see lakhs of electric and hybrid vehicles on roads by 2020.
→ Faster Adoption and Manufacturing of Hybrid and Electric Vehicle (FAME) / FAME India scheme [2015]:
 What:
• incentive scheme that encourages adoption of electric and hybrid vehicles in India. scheme for improving
electric mobility in India. part of National Electric Mobility Mission Plan (NEMMP). launched by Ministry of
Heavy Industries and Public Enterprises. Implemented by Department of Heavy Industry.
 Objectives:
• Encouraging electric vehicle manufacturers and related providers to manufacture higher number of electric
vehicles in India. To reduce vehicular emissions and air pollution levels within India. To establish electric
charging infrastructure. To convert 30% of total transportation into electric vehicles by 2030.
 Feature:
• Main thrust of FAME is to encourage electric vehicles by providing subsidies. It covers Hybrid & Electric
technologies like Mild Hybrid, Strong Hybrid, Plug in Hybrid & Battery Electric Vehicles. FAME proposes to
give push to electric vehicles (EVs) in public transport and seeks to encourage adoption of EVs by way of
market creation and demand aggregation. Manufacturers of electric vehicles, infrastructure providers of
electric vehicles receive this incentive in form of subsidies. Incentives are provided to buyers of electric
vehicles in form of upfront reduction in purchase price of electric vehicles. 4 Focus: Technology
development, Demand Creation, Pilot Projects, Charging Infrastructure.
Page 403 of 719
 • FAME is operational in two phases:
 Phase I / FAME I:
o 1st phase of Fame India Scheme started in 2015 and completed in 2019. Authorities implemented
this 1stphase by focusing on 4 key areas: Demand Creation, Technology Platform, Pilot Project,
Charging Infrastructure. Government sanctioned about 500 charging stations during Phase I, out
of which about 230 charging stations are installed. Government allotted crores to cover operations
of Phase I and nearly 2.8 lakh electric vehicles were supported. Energy Efficiency Services Limited
(EESL) under Ministry of Power has deployed 65 public charging stations for EVs in India.
• Phase II / FAME II:
 2nd phase of FAME scheme started in 2019 till 2024. It stresses on electrification of public transportation
and shared transportation. It also aims to boost electric mobility and increase number of electric
vehicles in commercial fleets. Aims to provide incentives to many categories of vehicles: Electric Two-
wheelers; Electric Four-wheelers; Hybrid Four-wheelers; e-rickshaws; e-buses. Under 2ndphase,
Government is hopeful of establishing 2700 charging stations in metros, smart cities, hilly States,
million-plus cities across India, with active participation of public sector units and private players.
Charging infrastructure will include pantograph charging, flash charging. Government aims to cover
highways and establish charging stations on both sides of road with gap of 25 km between two
consecutive stations. It will also encourage interlinking of renewable energy sources with charging
infrastructure.
 Implemented how?
• By establishing charging stations. By incentivizing buyers. By publicizing benefits of EVs.
 Benefits:
• Reduction in environmental issues, fuel conservation issues. Reduction in demand for petrol and diesel.
Creation of new jobs in automobile sector. Reduction in air pollution. Vehicles of different segments will
receive subsidy benefits accordingly. Citizens can avail themselves of eco-friendly public transportation.
Individuals can reap benefits of renewable energy sources through charging systems. Establishment of
charging stations in close proximity further encourages individuals to opt for electric vehicles.
 Eligibility:
• Individuals who manufactureselectric vehicles. Individuals who are electric vehicle infrastructure providers.
 Shoonya Campaign:
→ What:
 One consumer awareness campaign aimed to reduce air pollution and use of EVs. initiative to promote
zero-pollution delivery vehicles.
→ How:
 by working with consumers, industry.
→ Function:
 It will promote adoption of electric vehicles (EVs) in urban deliveri es segment. It will create consumer
awareness about health, environmental, economic benefits of electric vehicles (EV).
→ Shoonya Brand: As part of Shoonya Campaign, corporate branding and certification programme is launched
to recognise and promote industry’s efforts towards transitioning to EVs for final -mile deliveries.
 Green Tax [2021]:
→ What:
 In 2021, Ministry of Road Transport and Highways approved proposal to introduce Green Tax on old vehicles.
→ Need:
 Commercial vehicles contribute most share of total vehicular pollution. Per older vehicles pollutes more than
per modern vehicle.
→ Feature:
 Levy Green Tax on old vehicles which are polluting environment. Policy of deregistration and scrapping of
vehicles owned by Government department and PSU, which are > 15 years. Revenue collected: Green Tax will
be kept in separate account; Green Tax will be used for tackling pollution, and to set up state of-art facilities in
States for emission monitoring.
→ Applicability:
 Personal vehicles > 15 years. Transport vehicles > 8 years. Public transport vehicles to be charged lesser. Higher
Green tax for vehicles registered in highly polluted cities. Differential tax based on: fuel type and vehicle type.
→ Exemption:
 Hybrid vehicle. Electric vehicles. Alternate fuel vehicle – CNG run, ethanol run, LPG run etc. Farming vehicle-
tractor, harvester, tiller etc.
→ Benefit:
 Discourage people to use environment damaging vehicle. Motivate people to use newer, less polluting vehicle.
Reduce pollution level. Make polluter pay for pollution.
 Bharat New Vehicle Safety Assessment Program / Bharat New Car Assessment Program / Bharat NCAP:

Page 404 of 719

 → What:
 It is one proposed New Car Assessment Program (NCAP) for India. Cars sold in India will be assigned
by star ratings based on their safety performance. It will be implemented in phases, according to plans
being drawn up by National Automotive Testing and R&D Infrastructure Project. It is 10 th NCAP in world
and is being set up by GOI.
→ Feature:
 It will serve as consumer-centric platform, allowing customers to opt for safer cars based on their Star Ratings
while promoting healthy competition among Original Equipment Manufacturers (OEMs) in India to manufacture
safer vehicles. It will not only ensure structural and passenger safety in cars but also increase export-worthiness
of Indian automobiles. Its testing protocol shall be aligned with global crash-test protocols.
 E-AMRIT [2022]:
→ Accelerated e-Mobility Revolution for India's Transportation mobile application. To raise awa reness on
electric mobility.
 Vehicle Scrappage Policy, 2021:
→ What:
 Policy for scrapping of vehicles which are old to reduce emission of pollutants. one important scheme presented
in 2021-22 Union Budget. phase out old vehicles. reduce vehicular pollution.
→ Features:
 Old vehicles will have to pass fitness test before re-registration. More than 15 years old commercial vehicles will
be scrapped. More than 20 years old private vehicles will be scrapped. Incentive: Central govt. may advise State
governments to offer road-tax rebate (partial refund of tax) for personal vehicles and for commercial vehicles as
incentive to owners of old vehicles so that they scrap old and unfit vehicles. Disincentive: 15 years or more old
vehicles, counted from registration date, would have to pay increased re-registration fees.
→ Issues:
 Limited incentive. Potential benefit from scrapping < vehicle resale value. This, makes scrapping unattractive to
vehicle owners.
→ Significance:
 environmentally friendly. safe manner. economic development to be more sustainable and environment
friendly. bring in investments. create jobs.
→ Way Forward:
 comprehensive plan. Increase in incentives / financial support. Unless old fleet vehicles are off road, benefits of
implementation of BS-VI vehicles will not be fully leveraged.
 ‘Grand Challenge’:
→ What: It is one tender for electric buses in India and is unified tender for Union and State procurement of electric
buses. It was launched by state-owned Convergence Energy Services Ltd (CESL). CESL is nodal agency for this
programme.
→ Benefit:
 Lower cost: On cost-per-kilometre basis, prices discovered through this unified tendering were 40% lower than
diesel and 34% less than CNG.
 It is considered as one climate action that runs on cooperative federalism.
 It enabled collaboration, pace, and transparency.
Value Addition:
 Hong Kong International Convention for Safe and Environmentally Sound Recycling of Ships, 2009 / International Ship
Recycling Convention, 2009 / Hong Kong Convention, 2009:
→ to improve health and safety of current ship breaking practices. ensuring that ships, when being recycled after
reaching end of their operational lives, do not pose any unnecessary risks to human health, safety and to
environment. not entered into force yet. overseen by International Maritime Organization (IMO). India – signatory
and ratified.
 Bi-fuel vehicle:
→ Vehicle in which two fuels are stored in separate tanks and engine runs on one fuel at one time, for
example, compressed natural gas (CNG), liquefied petroleum gas (LPG), or hydrogen. Bi-fuel vehicles are
distinguished from Flex-fuel vehicles.
 Cetyl alcohol:
→ one of 1 st alcohols to be isolated from fats. solid organic compound. At room temperature, cetyl alcohol
takes form of waxy white solid or flakes.
Mains Link:
 Discuss the benefits of ethanol blending with traditional fuel.
 Discuss the issues associated with Vehicle Scrappage Policy, 2021.
 Discuss the challenges associated Electric Vehicle Policies in India.
 Discuss the significance of recently introduced green tax.
 Electric vehicles are a better alternative to conventional fuel consuming vehicles. Critically analyze. Also discuss the recent
initiatives by the government to promote environmentally friendly vehicles.
Page 405 of 719
 ARMED GROUP / INSURGENCY [NORTHEAST]
News:
 2020:
→ Anniversary of historic BTR agreement 2020.
 2021:
→ Centre and Assam government to upgrade KarbiAnglong Autonomous Council into territorial council.
→ RengmaNagas in Assam writes to Centre demanding autonomous district council (ADC) amid decision by Centre and
Assam government to upgrade KarbiAnglong Autonomous Council into territorial council.
→ Karbi Agreement 2021 signed.
 2022:
→ GOI, Assam government, 8 armed Adivasi groups of Assam sign one tripartite memorandum of settlement.
At this signing, Union Home Minister Amit Shah says it is GOI’s aim to resolve inter-boundary disputes in
NE and strike conciliation with all armed insurgent groups in NE region before 2024.
About:
 NE security situation:
→ Assam: About 60% of Assam is now free from AFSPA.
→ Manipur: 15 police stations in 6 districts were taken out of per iphery of disturbed area.
→ Arunachal: AFSPA remains in only 3 districts, and 2 police stations in one district.
→ Nagaland: Disturbed area notification was removed from 15 police stations in 7 districts.
→ Tripura: AFSPA withdrawn completely.
→ Meghalaya: AFSPA withdrawn completely.
 Peace agreements with insurgent groups of NE India:
→ Bru Accord 2020: Bru-Reang agreement to solve Refugee crisis (permanent settlement of 6959 Bru families
in Tripura with financial package).
→ Peace agreements with NSCN (K), NSCN (R), N SCN (NK), NSCN (IM).
→ Karbi Anglong Agreement (2021): Here, more than 1,000 members of armed outfits came forward to
surrender and give up path of violence.
→ Bodo Peace Accord (2020): Attempt to increase administrative, legislative and financial powers given to
Bodo Territorial Region (BTR).
 Insurgency in Assam:
→ Karbis:
 Who:
• one of NE India’s tribal groups. major ethnic community in Assam. largely inhabiting KarbiAnglong
and Dima Hasao (formerly North Cachar) hills. many factions are there within Karbis.
 Karbis’ demands:
• core demand - formation of separate State. In 2011, Karbi underground organisation decided to
lay down its arms and sign tripartite settlement with Centre and Assa m government, and in return
asking for enhanced autonomy, special packages for Karbi Anglong Autonomous Council (KAAC).
 Karbi Agreement 2021:
• History:
 Insurgency by Karbi is long history in Assam since 1980s - killings, ethnic violence, abductions, taxation.
• What:
 Tripartite agreement / memorandum of settlement / peace accord signed among - 5 insurgent groups
of Assam, Centre, Assam government to end years of violence in KarbiAnglong region, Assam.
• Highlight:
 About 1,000 armed cadres renounced violence and joined mainstream. Rehabilitation of renounced
cadres. Centre will provide special development package (crores of rupees) over next 5 years to Assam
government for development of Karbi areas. Assam government will set up Karbi Welfare Council for
focused development of Karbi people living outside ‘KarbiAnglong Autonomous Council’ (KAAC) area.
Consolidated fund of Assam State will be augmented to supplement resources of KAAC. KAAC will be
given more legislative, executive, administrative, financial powers.
• Significance:
 to bring end to violence and establish peace in Assam. Greater autonomy to KarbiAnglong Autonomous
Council (KAAC). Protection of identity, language, culture of Karbi people. Focused development of KAAC
area, without affecting territorial and administrative integrity of Assam.
→ Bodo:
 Who:
• single largest tribal community in Assam. used to control large parts of Assam in past
 Bodoland territorial region (BTR):

Page 406 of 719

 • located in NW part of Assam. Bodoland region is also autonomous territorial region that is
administered by elected body – Bodoland Territorial Council (BTC).
 Bodoland Dispute History:
• Separate state:
 In 1960s, Bodosdemanded for separate state called Bodoland.
• Assam Movement:
 Assam Accord 1985 addressed demands of “Assamese people”. And thus, Bodoslaunchedtheir own
movement to protect their own identity.
• 50 – 50 Assam:
 In late 1980s, All Bodo Students Union (ABSU) renewed demand and demanded “Divide Assam fifty-
fifty”.
 Bodo Peace Accord [2003]:
• 1st signed in 2003 and then extended in 2020.
• Bodoland Territorial Region (BTR) Agreement 2020:
 Highlight:
o BTR:
✓ Villages dominated by Bodos would be included in BTR. Villages with non-Bodo population
would be excluded from BTR.
o Criminal cases registered against NDFB factions:
✓ for “non-heinous” crimes to be withdrawn. for “heinous” crimes to be reviewed.
o Families of those killed during Bodo movement would be compensated.
o Special DevelopmentPackageforBodoswould be given by Centre.
o Total number of Assembly seatsto be increased..
 Significance:
o end to the long-run violence in Bodoland. Ended 50-year-old Bodo crisis. NDFB Cadres to be
rehabilitated by Centre and Assam Government. Bodos would be brought into mainstreampeople.
NDFB would leave violence, surrender and disband their armed organisations.
Note:
 Karbi Anglong, Assam:
→ erstwhile known as Rengma Hills. In 1963, Rengma Hills was partitioned between Assam and Nagaland, during
creation of Nagaland State. Rengma Hills – place of aggressive influx of outsiders.
 Karbi Anglong Autonomous Council (KAAC):
→ autonomous district council. protected under 6thSchedule Indian Constitution.
Mains Link:
 Discuss the significance of BTR Agreement.
 Differentiate between 5th and 6th schedules of the Indian constitution.

OZONE / TRIOXYGEN / O3
News:
 2020:
→ According to Centre for Science and Environment (CSE), India, during Covid-19 lockdown, Particulate
Matter (PM), Nitrous Oxide (N2O) levels fell but pollutant Ozone (O3) increased in many cities.
→ Researchers found that concentration of near surface ozone in Brahmaputra River Valley is low compared
to other urban locations in India. [good news]
 2021:
→ India decides to ratify 2016 Kigali Amendment to 1987 Montreal Protocol.
 2022:
→ Scientists reveal large, all-season ozone hole in lower stratosphere over tropics comparable in-depth to that of
Antarctic hole, but roughly 7 times greater in area. It is all-season ozone hole — defined as area of ozone loss larger
than 25% compared with undisturbed atmosphere.
→ National Oceanic and Atmospheric Administration (NOAA) (American scientific and regulatory agency) says Good
news! Recovery of ozone layer achieves significant milestone. Levels of ozone-depleting substances in 2022 are back
to those observed in 1980 before ozone depletion was significant. Concentration of ozone-depleting substances in
atmosphere has reduced to reach significant milestone in 2022.
→ World Ozone Day 2022 celebrated.
About:
 What:
→ inorganic molecule with chemical formula – O3. It is both natural and man-made product that occurs in
Earth’s upper atmosphere (stratosphere) and lower atmosphere (troposphere). It is measured using
Dobson unit. About 90% of ozone in atmosphere is concentrated between 15 and 30 kms above earth’s
surface (stratospheric ozone). It is also found at ground level in lower concentrations (tropospheric ozone)
and here, ozone is pollutant that is key part of smog over cities.
Page 407 of 719
 Ozone (O3) is highly reactive gas composed of 3 oxygen atoms. It is both natural and man -made
product that occurs in Earth’s upper atmosphere (stratosphere) and lower atmosphere (troposphere).
It is mere 3mm shield in stratosphere that is saving life blooming on Earth from harmful UV rays.
 Formation:
→ Ozone (O3) is formed from dioxygen (O2) by action of ultraviolet (UV) light and electrical discharges within
Earth's atmosphere.
→ Ozone is present in low concentrations throughout Earth's atmosphere.
→ Ozone is present in high concentration in ozone layer of stratosphere.
→ Ozone layer of stratosphere absorbs most of Sun's ultraviolet (UV) radiation.
 Feature:
→ pale blue gas. distinctively pungent smell. less stable than O2 (O3 is reactive oxidant gas). O3 breaks down
in lower atmosphere to O2. highly reactive gas.
 Stratospheric Ozone (O3):
→ Ozone (O3) is produced naturally in stratosphere when highly energetic solar radiation strikes molecules
of oxygen (O2), and cause said two oxygen atoms to split apart in process called photolysis.
→ If one freed oxygen atom collides with another O2, then it joins up and forms ozone (O3).
→ While entire UV-C and some of UV-B are absorbed by ozone layer and atmosphere, UV -A makes its way to
our planet.
 Ozone Pollution:
→ Tropospheric Ozone Pollution:
 What:
• ground level ozone / bad ozone
 Factors:
• Ozone is primarily sunny weather problem in India: high winds, irregular rains, irregular thunderstorms,
high temperature, heat waves.
 Formation:
• Ground level ozone / bad ozone is not directly emitted into air by any source. But it is created by
photochemical reactions between oxides of nitrogen (NOx) and other volatile Organic Compounds
(VOCs) and gases in air, under influence of sunlight and heat. This happens when pollutants are emitted
from: industrial facilities, vehicle exhaust, chemical solvents, power plants, industrial boilers, petroleum
refineries, chemical plants. That is: Heat & Sun + NOx + VOCs = Ground-level Ozone (O3).
 Concerns:
• Ozone at ground level is harmful air pollutant. It impacts human health, Phytoplankton growth, crops
growth.
• affects people (respiratory system, esp. lung function), environment
• main ingredient inatmosphericSmog.
• Elevated ground-level ozone damages agricultural crops, vegetation, trees, especially slow growing crops,
long-lived trees. [poor quality and quantity]
• Makes vegetation more pronet o disease.
• Reduces forest growth and habitat quality.
• Reduces species diversity in ecosystems (animals, insects, plants, fish)
 Ozone-depleting substance (ODS):
→ CFCs and other halogenated ODS are mainly responsible for man -made chemical ozone depletion. These
are mainly used in refrigerators, air conditioners, fire extinguishers, foams.
 Concern:
→ Ozone pollution.
→ Humans require UV-B to generate Vitamin D but excess of these radiations can cause serious illness and
also result in reduced crop yield.
 Initiatives:
→ Treaty for ODS regulations:
 Vienna Convention for Protection of Ozone Layer (1985); Montreal Protocol (regulated production and
consumption of ODS) (1987); Kigali Amendment (phase down production and consumption of HFCs).
Note:
 Ozone in Brahmaputra Valley:
→ Reason for low ozone in Brahmaputra valley:
 Brahmaputra valley is influenced by local sources like adjacent major national highway.
 During daylight, Brahmaputra valley is nearly in photo-stationary state, indicating low impact of organic species
on ozone concentrations.
 Vienna convention [1985]:
→ Vienna Convention for Protection of Ozone Layer

Page 408 of 719

 → One multilateral environmental agreement that provided frameworks for international reductions in
production of CFC due to their contribution to destruction of ozone layer, resulting in inc reased threat of
skin cancer.
→ Vienna Convention is 1 st international agreement dedicated to protection of ozone layer. This Convention
commits all countries to take measures to protect human health and environment resulting from
modifications to ozone layer.
 Montreal Protocol [1987]:
→ What:
 Protocol / agreement / international environmental treatyto protect ozone layer of upper atmosphere to phase
out of production, consumption of Ozone Depleting Substances (ODS) and to reduce ODS concentration in
atmosphere to help protect earth’s ozone layer. Montreal Protocol is to date only UN treaty ever that has been
ratified every country on Earth.
→ Origin:
 In 1985, some nations signed Vienna Convention for Protection of Ozone Layer (Vienna Convention) which
established framework for negotiating international regulations on ozone-depleting substances (ODS).
 After discovery of ozone hole, binding agreement - Montreal Protocol, 1987 was signed in Montreal, Canada.
 Montreal Protocol was designed to reduce production and consumption of ODS in order to reduce their
abundance in atmosphere and thereby protect earth’s fragile ozone Layer.
→ Feature:
 It mandated complete phase-out of chlorofluorocarbons (CFC), other ozone-depleting substances (ODS).
 It replaces CFCs with Hydrofluorocarbons (HFC). [Even though HFCs don’t harm ozone but are extremely potent
to cause global warming and therefore under Kigali amendment (2016), HFCs were again later replaced as well].
→ 2016 Kigali Amendment to 1987 Montreal Protocol:
 What:
• Negotiated in Kigali - capital of Rwanda.
• key amendment to 1987 Montreal Protocol
• transition to non-HFC
• Around 197 countries, including India, China and USA, agreed at Kigali to reduce use of HFCs by roughly 85%
of their baselines by 2045, by amending 1987 Montreal Protocol.
 Feature:
• It enables gradual phase-down of hydrofluorocarbons (HFC).
 Goals:
• Before middle of this century (2050), current HFC use has to be curtailed by at least 85 %. Countries have
different timelines to do this.
• While HFC reductions for rich countries have to begin immediately, developing countries (India etc) have to
begin cutting their HFC use only from 2031.
• Developed countries have to achieve 85 % reduction target by 2036.
• India:
 India has to achieve 85 % reduction target by 2047
 Significance and expected outcomes:
• 2016 Kigali Amendment is expected to prevent about 0.5°C rise in global warming by end of this century
(2100).
• 2016 Kigali Amendment is crucial to achieving 2015 Paris Agreement target of restricting temperature rise
to within 2°C from pre-industrial times.
• HFC phase down is expected to prevent greenhouse gas (GHG) emissions [helping prevent climate change,
global warming and would benefit people]
• No other single intervention to cut greenhouse gas (GHG) emissions comes even close to 2016 Kigali
Amendment in terms of returns offered and ease of implementation.
 India:
• In 2021, India ratified 2016 Kigali Amendment to Montreal Protocol, 1987.
• Challenges for India:
 Developing countries like India wants more time to phase out HFC gases because of high cost of patents
that govern alternative refrigerants.
 India wants its domestic companies to be compensated by developed countries for transitioning to
alternative refrigerants.
• India’s plan:
 India will freeze HFC use by 2028 on 2024-26 baseline. That is, India will not emit more HFC than it did
in 2024-26.
→ Concerns:
 Transition from HCFCs to HFCs is still happening, particularly in developing world.
 Though HFCs are not harmful to ozone layer, HFCs are powerful greenhouse gases (GHG).
Page 409 of 719
  If left unchecked, HFC contribution to greenhouse gas (GHG) emissions is expected to reach up to about 20% by
2050.
→ India:
 India ratified original Montreal Protocol, 1987.
 India’s achievements in implementation of Montreal Protocol:
• India has been successfully implementing Montreal Protocol.
• India phased out: Chlorofluorocarbons (CFC), Carbon tetrachloride (CCl4), Halons, Methyl Bromide (CH3Br),
Methyl Chloroform.
• Currently, Hydrochlorofluorocarbons (HCFC) are being phased out [as per accelerated schedule of Montreal
Protocol].
• India has successfully implemented - Hydrochlorofluorocarbons (HCFC) Phase out Management Plan
(HPMP) Stage-I.
• Currently, India is implementing HPMP Stage-II.
• India decided to ratify 2016 Kigali Amendment to Montreal Protocol, 1987.
→ Status / Achievement:
 Montreal Protocol successfully phased-out chlorofluorocarbons (CFC) in last 3 decades.
 CFCs were gradually replaced, 1st by hydrochlorofluorocarbons (HCFC), and eventually by HFCs.
 Today, in 2022, more than 99% of ODS have been phased out and ozone layer is on path to recovery.
 Hydrofluorocarbons (HFC):
→ family of chemicals used extensively in: air-conditioning, refrigeration, foam industry.
→ HFC has minimal impact on ozone layer in comparison to CFC, HCFC.
→ much worse than carbon dioxide (CO2) in causing global warming.
→ According to UNEP, average global warming potential (heat trap) of HFCs is about 2,500 times that of CO2.
Value Addition:
 Global Ozone Day / World Ozone Day:
→ 16th September. celebrated each year. to commemorate completion of ratification by all countries of Montreal
Protocol, 1987. to spread awareness among people about depletion of Ozone Layer. to spread awareness about
measures taken / to be taken to preserve Ozone layer.
→ World Ozone Day 2022:
 Theme is “Montreal Protocol@35: Global cooperation protecting life on earth”. [2022 marks 35th year of
implementation of Montreal Protocol].
 India Cooling Action Plan (ICAP) [2019]:
→ launched by Ministry of Environment, Forests and Climate Change
→ 20-year perspective for access to sustainable cooling.
→ ICAP itself outlines actions needed to provide access to sustainable cooling.
→ ICAP describes cooling as developmental need.
→ ICAP seeks to:
 reduce cooling demand across sectors by 20% to 25% by 2037-38
 reduce refrigerant demand by 25% to 30% by 2037-38
 reduce cooling energy requirements by 25% to 40% by 2037-38
 recognise cooling and related areas as area of research under national Science and Technology Programme
 training and certification of 1 lakh servicing sector technicians by 2022-23, synergizing with Skill India Mission.
Mains Link:
 Analyse the science behind the causes of ozone depletion, greenhouse effect, global warming and acid rains. (200 Words)
(NCERT Question)
LIQUID OXYGEN (O2)
News:
 April 2021:
→ Invoking Disaster Management Act, 2005, Centre orders States that all liquid Oxygen should be made available to
government and should be used for medical purposes only, with some exception sectors like pharmaceutical, nuclear
energy etc.
About:
 liquid form of molecular Oxygen (O2).
 Characteristics:
→ blue color
→ strongly paramagnetic (not permanent magnetism)
→ cryogenic nature (very low temperature)
→ liquid oxygen can cause materials it touches to become extremely brittle (because of its cryogenic nature)
→ very powerful oxidizing agent:
 organic materials burn rapidly and energetically in liquid oxygen.
 Uses:
Page 410 of 719
 → In commerce, liquid oxygen is classified as industrial gas and is widely used for industrial and medical purposes.
→ Liquid oxygen is most common cryogenic liquid oxidizer propellant for spacecraft rockes, usually in combination
with liquid hydrogen, kerosene or methane.
 Note:
• ISRO, India had developed cryogenic engine (liquid O2 and liquid H2) making India among few countries to
have cryogenic technology.

ECOLOGY
News:
 2021:
→ Earth Overshoot Day, 2021 happened almost 1 month earlier than Earth Overshoot Day, 2020.
 2022:
→ Effects of climate change (Heatwaves, droughts etc.) brings into focus two strands of environmental
philosophy that reinvent relationship between nature and humans — shallow ecologism and deep
ecologism.
→ Earth Overshoot Day 2022 falls on 28th July (last year it was 29th July).
→ Union Cabinet approves signing of MoU between India and Nepal in field of biodiversity conservation, to
promote cooperation between two countries in field of fores ts, wildlife, environment, and climate change,
through sharing of knowledge and best practices, restoration of corridors and interlinking areas.
About:
 What:
→ Study of relationships between living organisms, including humans, and their physical environment.
Ecology is branch of biology, and it is not synonymous with environmentalism. Ecology as one distinct
branch of biology, focuses on ways in which plants and animals are sustained by self-regulating natural
systems – ecosystems – composed of both living and non-living elements. Ecology implies both
interconnectedness and equilibrium, as all ecosystems tend towards state of harmony through system of
self-regulation.
 Level:
→ Ecology considers organisms at: Individual, Population, Community, Ecosystem, biosphere level.
 Feature:
→ Ecology overlaps with closely related sciences of biogeography, evolutionary biology, genetics, ethology,
and natural history.
 Ecologism:
→ What:
 Ecologism is one political ideology based on position that non-human world is worthy of moral consideration,
and that this should be taken into account in social, economic, political systems. It is green political theory,
regarded as distinctive ideological tradition since about 1970s. In some senses, it is most radical of political
ideologies, being prepared to go where no other ideology will go in challenging established moral and
philosophical beliefs as well as conventional lifestyles.
→ Genesis:
 Ecologism concepts emerged in 1970s, when Norwegian philosopher Arne Naess sought to look beyond popular
pollution and conservation movements to address environmental degradation. By placing humans at heart of
environmental crisis, Naess outlines difference between two styles of ecologism - shallow ecologism and deep
ecologism.
→ Type:
 Shallow Ecologism / Weak Ecologism:
• What:
 Shallow ecology refers to philosophical or political position that environmental preservation should
only be practiced to extent that it meets human interests. Shallow ecology is one green ideological
perspective that harnesses lessons of ecology to human needs and ends, and is associated with values
such as sustainability and conservation; humanist ecology. Shallow ecology is also referred to "light
green."
• Feature:
 Shallow ecology provides anthropocentric defense of natural world, holding that it is worth protecting
to extent that it benefits humans. Fashionable fight against pollution and resource depletion is shallow
ecologism. Exponents of this philosophy believe in continuing our present lifestyle, but with specific
tweaks aimed at minimising damage to environment. It may include use of vehicles that cause less
pollution or air conditioners that do not release chlorofluorocarbons (CFCs). This branch of ecologism
primarily serves to maintain lifestyle of those dwelling in developed countries.
• Issues:
 Deep ecology’s proponents argue that shallow ecologism prioritises humans above other forms of life,
and subsequently preserves environmentally destructive way of life in modern societies and that, by
Page 411 of 719
 sustaining this lifestyle, shallow ecologism further widens inequalities between countries. For instance:
despite constituting only 5% of world’s population, U.S. accounts for 17% of world’s energy
consumption and is 2nd largest consumer of electricity after China; While low- and middle-income
countries have recorded lower cumulative and per capita CO2 emissions over past 2 centuries, it is
wealthier countries which are most responsible for majority of carbon emissions.
 Deep Ecologism:
• What:
 Deep ecology is one environmental philosophy that promotes inherent worth of all living beings
regardless of their instrumental utility to human needs, and restructuring of modern human societies
in accordance with such ideas. Deep ecology is somewhat recent branch of ecological philosophy
(ecosophy) that considers humankind as integral part of its environment. This philosophy emphasizes
interdependent value of human and non-human life as well as importance of ecosystem and natural
processes. It provides foundation for environmental and green movements and has led to new system
of environmental ethics. One green ideological perspective that rejects anthropocentrism and gives
priority to maintenance of nature, and is associated with values such as biocentric equality, diversity
and decentralisation.
• Objective:
 Deep ecologism aspires to sustain nature by making large-scale changes to our lifestyle. [These may
include limiting commercial farming of meat to preserve forest areas and reduce artificial fattening of
animals, or reshaping of transport systems which involve use of internal combustion engines]; Deep
ecologism shifts attention from pollution and conservation narratives to robust policy formulation and
implementation. [According to Naes, policy-making must be aided by reorientation of technical skills
and inventions in new directions that are ecologically responsible. In fact, Naess recommends that
ecologists reject work that is supervised by authorities with limited ecological perspectives. As
irreplaceable informants, ecologists should not submit to power which does not recognise critical
ecological priorities]; To recognise complex richness of different lifeforms, deep ecologism calls for re-
evaluation of ‘survival of fittest’ doctrine. Survival of fittest should be understood through human ability
to cooperate and coexist with nature, as opposed to exploiting or dominating it. Deep ecologism thus
prioritises ‘live and let live’ attitude over ‘either you or me’ approach.
• Feature:
 Deep ecology's core principle is claim that, like humanity, living environment as whole has same right
to live and flourish; Deep ecologism believes that humans should radically change their relationship
with nature. Its proponents reject shallow ecologism for prioritising humans above other forms of life,
and subsequently preserving environmentally destructive way of life in modern societies. It says that
by sustaining this lifestyle, shallow ecologism further widens inequalities between countries. For
instance, despite constituting only 5% of world’s population, U.S. accounts for 17% of world’s energy
consumption and is 2nd largest consumer of electricity after China. Similarly, while low- and middle-
income countries have recorded lower cumulative and per capita CO2 emissions over past 2 centuries,
it is wealthier countries which are most responsible for majority of carbon emissions; Deep ecology
argues that natural world is one complex of relationships in which existence of organisms is dependent
on existence of others within ecosystems. It argues that non-vital human interference with or
destruction of natural world poses threat therefore not only to humans but to all organisms constituting
natural order; Deep ecology describes itself as "deep" because it persists in asking deeper questions
concerning "why" and "how" and thus is concerned with fundamental philosophical questions about
impacts of human life as one part of ecosphere, rather than with narrow view of ecology as branch of
biological science, and aims to avoid merely anthropocentric environmentalism (which is concerned
with conservation of environment only for exploitation by and for humans purposes, which excludes
fundamental philosophy of deep ecology). Deep ecology seeks more holistic view of world we live in
and seeks to apply to life understanding that separate parts of ecosystem (including humans) function
as whole; Deep ecologism believes that humans should radically change their relationship with nature;
It aspires to sustain nature by making large-scale changes to our lifestyle. These may include limiting
commercial farming of meat to preserve forest areas and reduce artificial fattening of animals, or
reshaping of transport systems which involve use of internal combustion engines.
• Way Forward:
 Deep ecologism may be achived by change of way of lifestyle like limiting commercial farming of meat
to preserve forest areas and reduce artificial fattening of animals, or reshaping of transport systems
which involve use of internal combustion engines; Deep ecologism wants us to shift attention from
pollution and conservation narratives to robust policy formulation and implementation. [According to
Naes, policy-making must be aided by reorientation of technical skills and inventions in new directions
that are ecologically responsible. In fact, Naess recommends that ecologists reject work that is
supervised by authorities with limited ecological perspectives. As irreplaceable informants, ecologists
should not submit to power which does not recognise critical ecological priorities]; Deep ecologism calls

Page 412 of 719

 for re-evaluation of ‘survival of fittest’ doctrine. Survival of fittest should be understood through human
ability to cooperate and coexist with nature, as opposed to exploiting or dominating it. Deep ecologism
thus prioritises ‘live and let live’ attitude over ‘either you or me’ approach.
 Ecocentrism:
• Approach to understanding that prioritises maintenance of ecological balance over achievement of human
ends. Only deep ecologists fully embrace ecocentrism. Eco-centrism is opposite of Anthropocentrism.
 Anthropocentrism / Human-centredness:
• Belief that human needs and interests are of overriding moral and philosophical importance. It is concerned
with conservation of environment only for exploitation by and for humans purposes. It excludes
fundamental philosophy of deep ecology. Anthropocentrism is opposite of eco-centrism.
→ Political potential of ecologism:
 Both strands of ecologism (shallow and deep) draw from different frameworks, including socialism, anarchism,
feminism, conservatism and sometimes even fascism. Deep ecologism in particular borrows from socialism. In
his writings on deep ecologism, Naes argues that narrow focus on pollution and conservation movements is
counterproductive. He believes that when projects are only implemented to solve pollution, it generates evils of
different kind. For instance, installation of pollution control devices may increase cost of living, leading to
increase in class difference. Ethically responsible ecologism is one which operates in interest of all economic
classes; Environment may also become more vulnerable when decisions are strongly influenced by majority rule,
without taking local interests into consideration. According to Naess, solution to this can be found in
decentralising decision-making process and strengthening local autonomy. He claims that chain consisting of
local board, municipal council, State-wide institution, national government institution, coalition of nations, and
global institution can be reduced to one made up of local board, nation-wide institution, and global institution.
Lengthy decision-making chain is unfavourable as it is prone to excluding local interests; In all, Naess cautions
humans against adopting ‘vague, global’ approach to environmental crisis; Holistic perspective to crisis is one
which acknowledges regional differences and disparities between under and over-developed nations; Naess
stresses that political potential of movement be realised, and that those in positions of power be held
accountable. Responsibility of solving climate crisis falls on policy-makers as much as it does on scientists and
ecologists.
 Environmental philosophy:
→ What:
 Branch of philosophy concerned with natural environment and humans' place within it. It asks crucial
questions about human environmental relations such as "What do we mean when we talk about
nature?" "What is value of natural, that is non -human environment to us, or in itself?" "How should
we respond to environmental challenges such as environmental degradation, pollution, climate
change?" "How can we best understand relationship between natural world and human technology
and development?" and "What is our place in natural world?".
→ Feature:
 Environmental philosophy includes environmental ethics, environmental aesthetics, ecofeminism,
environmental hermeneutics, and environmental theology; Some of main areas of interest for
environmental philosophers are: Environmentalism, deep ecology.
→ Environmentalism / Environmental Rights:
 What:
• Broad philosophy, ideology, and social movement regarding concerns for environmental
protection and improvement of health of environment, particularly as measure for environment
health seeks to incorporate impact of changes to environment on humans, animal s, plants, non-
living matter. It is concern about natural environment and particularly desire to reduce
environmental degradation; policy orientation rather than ideological stance (unlike ecologism).
→ Pastoralism:
 Belief in virtues of rural existence: simplicity, community and closeness to nature, in contrast to
corrupting influence of urban and industrialised life.
→ Environmentalism vs Ecologism:
 Environmentalism focuses more on environmental and nature-related aspects of green ideology and
politics. Ecologism combines the ideology of social ecology and environmentalism. Ecologism is more
commonly used in continental European languages, while environmentalism is more commonly used
in English but words have slightly different connotations.
 Ecological niche:
→ What:
 In ecology, niche is match of species to specific environmental condition. It describes how organism
or population responds to distribution of resources and competitors (for example, by growing when
resources are abundant, and when predators, parasit es and pathogens are scarce) and how it in turn
alters those same factors (for example, limiting access to resources by other organisms, acting as food
source for predators and consumer of prey).
Page 413 of 719
 It is right set of environmental conditions under which anim al or plant species will thrive.
Range of ecological niches can occur within ecosystem. Biodiversity is result of these niches being
occupied by species that are uniquely suited to them.
One example of ecological niche is that of dung beetle. Dung beetle consumes dung both in
larval and adult forms. Dung beetles store dung balls in burrows, and females lay eggs within them.
This allows hatched larvae immediate access to food.
→ Feature:
 Ecological niche describes functional position of organism in its environment.
 Niche comprises:
• Habitat in which organism lives. Organism’s activity pattern (periods of time during which it is active).
Resources organism obtains from habitat.
→ Ecological niche modelling:
 It is one predictive tool for identifying new possibilities — new inhabitants for existing habitat, or new
geographical locations where desirable plant may grow well.
Species distribution modelling (SDM) / environmental (or ecological) niche modelling (ENM)
uses computer algorithms to predict distribution of species across geographic space and time using
environmental data.
One example is modelling that identified 4,200 km2 of new areas suitable for saffron
cultivation in JK, HP, Sikkim, Imphal (Manipur), TN.
→ Issue:
 Due to climate change, ecological Niches are altering and this may have impact on Agriculture and
therefore we need ecological niche modelling (using Big Data, other computative technology).
→ Way Forward:
 Due to climate change, ecological Niches are alterin g and this may have impact on Agriculture and
therefore we need ecological niche modelling (using Big Data, other computative technology).
Note:
 Ecological Footprint:
→ What:
 Ecological footprint is method promoted by Global Footprint Network to measure human demand on natural
capital i.e. quantity of nature it takes to support people or economy. Ecological footprint tracks this demand
through ecological accounting system. In short, ecological footprint is measure of human impact on
environment. Ecological footprint is metric / method that comprehensively compares human demand on nature
against nature’s capacity to regenerate.
 Global Footprint Network:
→ global organisation calling for urgent climate action and sustainable consumption.
 Carbon footprint:
→ current, negative state of emissions of product or service. defined as sum of green house gas (GHG) emissions and
removals in product system, over entire lifetime of product.
 Earth Overshoot Day:
→ What:
 Each year, Earth Overshoot Day marks date when we have used up all biological resources that Earth can renew
during that year. date is announced annually by Global Footprint Network. This is marked as day when
humanity has exhausted nature’s budget for that year.
→ Concept:
 1st conceived by Andrew Simms of UK think tank - New Economics Foundation. In 2006, New Economics
Foundation partnered with Global Footprint Network to launch 1 st global Earth Overshoot Day campaign.
→ Computation:
 Dividing Earth’s bio capacity (amount of ecological resources Earth is able to generate in 1 year) by humanity’s
Ecological Footprint (humanity’s demand for that year), and multiplying by 365 (days in year).
→ Reason Earth Overshoot Day, 2021 observed one month earlier than Earth Overshoot Day, 2020:
 increase in global carbon footprint (emissions). decrease in global forest biocapacity [due to widespread
deforestation in Amazon rainforest]. increase in deforestation. increase in biodiversity loss.
→ Concern:
 At our current rate, we’re using around 1.7 Earths every single year. That is, we’re operating on “ecological
deficit”. Our spending for 2021 is among highest since we entered into overshoot territory in 1970s.
 Transboundary Protected Area (TBPA):
→ One ecological protected area that spans boundaries of more than 1 countr y or sub-national entity. Such
areas are also known as Transfrontier Conservation Areas (TFCAs) or peace parks. TBPAs exist in many
forms around world, and are established for various reasons. Preservation of traditional animal migration
patterns, ensuring sufficient food and water sources for population growth, is one critical reason for

Page 414 of 719

 creation of TBPAs. However, TBPAs also encourage tourism, economic development and goodwill between
neighbouring countries, as well as making it easier for indigenous inha bitants of area to travel.
→ Eg. India shares TPA with Nepal on Kanchenjunga Conservation Area, Terai Arc landscape, Sacred
Himalayan Landscape (Nepal, Sikkim, Bhutan). India also has Transboundary Tiger recovery with Nepal. India also
has Transboundary Manas Conservation Area (TraMCA) with Bhutan.
Value Addition:
 Carbon handprint:
→ positive environmental impact of product or service throughout its life cycle
Mains Link:
 What is Ecological footprint? Why is it significant? Discuss.
 Discuss the significance of Deep ecologism.

SWACHH BHARAT MISSION (SBM) / SWACHH BHARAT ABHIYAN (SBA) [2014]

News:
 2019:
→ India achieves 100% ODF free status.
 2021:
→ Ministry of Jal Shakti begins ‘SUJALAM’ campaign, as part of AzadiKaAmritMahotsav.
→ SwachhSurvekshanGrameen, 2021 to be launched under Swachh Bharat Mission 2.0.
→ Government launched Swachh Bharat Mission-Urban 2.0 (2nd phase of SBM-U) and Atal Mission for Rejuvenation
and Urban Transformation 2.0 (2nd phase of AMRUT) to make cities free of garbage and ensuring safe water, not
allow any untreated water discharge into any of rivers in India, respectively.
 2022:
→ According to one parliamentary standing committee report on water resources:
 Only 12% of villages that were supposed to get infrastructure for liquid waste management in 2021 have
achieved their goal under 2ndphase of Swacch Bharat Mission.
 Implementation of solid waste management infrastructure also lagged behind, with only 22% of target villages
covered during 2021-22.
→ Swachh Bharat Mission Urban 2.0 (SBM-U 2.0) launches revised Swachh Certification Protocols for ODF, ODF+,
ODF++, and Water+ certifications. [Water+ protocol aims to provide guideline for cities and towns to ensure that no
untreated wastewater is released into environment thereby enabling sustainability of sanitation value chain.]
→ Over 100,000 villages have declared ODF+.
→ MoHUA Minister Shri Hardeep Singh Puri had launched ‘Indian Swachhata League’. Now, this maiden edition of
‘Indian Swachhata League’ (which is under SBM-Urban 2.0) has mobilized ½ million young students, citizen
volunteers, youth leaders, and celebrity icons across India towards Mission’s goal of making cities clean, green, and
garbage free.
→ Indore given cleanest city of India for 6th year in row, while Madhya Pradesh is cleanest State in India.
About:
 What:
→ core scheme
 Aim:
→ To make India ODF free by 2019
 Component:
→ Swachh Bharat Mission-Rural (SBM-R):
 In its 1stphase, Swacch Bharat Mission aimed to provide one toilet in every rural household. It claimed to have
achieved this goal of targetting one toilet in every rural household in 2019.
 SBM (Grameen) Phase-II:
• It will be implemented from 2020-21 to 2024-25 in mission mode. Fund sharing pattern between Centre
and States will be 90:10 for NE States and Himalayan States and UT of J&K; 60:40 for other States; and 100%
for other Union Territories.
• SBM-G is being implemented by Ministry of Jal Shakti.
→ Swachh Bharat Mission-Urban (SBM-U) [2014]:
 What:
• SBM-U was launched in 2014 to achieve 100% ODF status in all urban local bodies. MoHUA.
 SBM-U 2.0:
• What:
 SBM-U 2.0 was announced in Budget 2021-22. It is continuation of SBM-U’s 1st phase (2014 to 2019).
Under it, Government is trying to tap safe containment, transportation, disposal of faecal sludge, and
septage from toilets. SBM-U 2.0 refers to 2021-22 to 2025-26 phase of SBM-U.
• Aim:
 To make all cities 100% garbage free [from current 70% garbage free]

Page 415 of 719

  Ensure grey and black water management in all cities [other than those covered under AMRUT]
 Make all urban local bodies as ODF+
 Make all urban local bodies with population <1 lakh as ODF++
• Feature:
 Focus on source segregation of solid waste by utilizing principles of 3Rs (Reduce, Reuse, Recycle)
 Scientific processing of all types of municipal solid waste.
 Remediation of legacy dumpsites for effective solid waste management.
 Execution:
→ Ministry of Drinking Water and Sanitation - for rural areas
→ Ministry of Housing and Urban Affairs (MoHUA) - for urban areas.
 Achievements of India [as of now]:
→ 100% Open Defecation Free (ODF). As of 2022, nearly 8 years after launch, SBM-G recorded another milestone - of
1,01,462 villages declaring themselves as ODF+.
→ Most of wastes in Indian Cities are being processed now.
→ Behavioral Changes:
 Cleanliness has become great campaign.
 PM cited that Children no longer throw Toffee wrappers around but keep them in pockets to be disposed of in
dustbin later.
→ National Respect and Pride:
 Successes of SBM-U, AMRUT missions have given citizens respect, dignity, pride in collective ambition,
unmatched love for motherland.
→ Enhanced finances:
 Allocation of fund to MoHUA have increased.
Note:
 ODF, ODF+, ODF++:
→ Ministry of Housing and Urban Affairs (MoHUA)
→ Declared for a city, ward or work circle.
→ ODF+ and ODF++ were launched to further scale up and sustain the work undertaken by the cities after achieving the
ODF status under Phase I of theSwachh Bharat Mission — Urban (SBM-Urban).
→ Cities that had been certified ODF at least once are eligible to declare themselves as SBM-ODF+ & SBM-ODF++.
→ City can be declared as Water Plus provided, all wastewater released from households, commercial
establishments etc. is treated to satisfactory level before releasing treated wastewater to environment.
→
{ODF Tag} {ODF+ Tag} {ODF++ Tag}
{Launched} 2016 2018 2018
{Aim} to further scale up and to further scale up and sustain work
sustain work undertaken undertaken by cities after
by cities after achieving ODF status under Phase I of
achieving ODF status SBM-Urban.
under Phase I of SBM-
Urban.
{Eligibility} Cities that had been Cities that had been certified ODF at
certified ODF at least once least once.
{What} At any point of the a. At any point of a. At any point of the day, not a
day, not a single the day, not a single person is found
person is found single person is defecating and/or urinating in
defecating in the found defecating the open; and
open. and/or urinating b. all community toilets and
in the open; and public toilets are functional
b. all community and well-maintained; and
toilets and public c. faecal sludge/septage and
toilets are sewage is safely managed and
functional and treated, with no discharging
well-maintained. and/or dumping of untreated
faecal sludge/septage and
sewage in drains, water bodies
or open areas.
 ODF status:
→
{ODF Status} {Meaning}
ODF Not single person found defecating in open.

Page 416 of 719

 ODF+ No one defecating in open and well maintained
community and public toilets.
ODF++ All conditions of ODF+ and toilets with sludge and
septage management.
Water+ All waste-water is being treated as per CPCB norms
before release.
 SUJALAM:
→ Campaign for 100 days
→ objective:
 tocreate more and more ODF + villages via waste water management at village level by creating soak-pits.
→ Need:
 disposal of waste water and clogging of waterbodies in villages remain one of major problems.
→ Activities:
 Organizing community consultations, KhuliBaithaks, Gram Sabha meetings to analyze current situation.
 Pass resolution to maintain ODF sustainability
 soak pits construction to manage grey water.
 Retrofit toilets via community mobilization.
 Ensure all new households in village have toilets.
→ Significance:
 management of wastewater and in turn would help to revive waterbodies.
 boost momentum of Swacch Bharat Mission- Grameen phase II activities through community participation.
 ‘Indian Swachhata League’:
→ It is India's 1st inter-city competition led by youth towards building Garbage Free Cities. More than 1,800 cities from
Leh to Kanniyakumari participated in its maiden edition (in 2022). It is under SBM-Urban 2.0. Its maiden edition (2022
edition) mobilized ½ million young students, citizen volunteers, youth leaders, and celebrity icons across India
towards Mission’s goal of making cities clean, green, and garbage free.
Mains Link:
 “Swachh Bharat Mission campaign has become the global benchmark for participatory and transfo rmative
development.” Elucidate.

DIGITAL CURRENCY / DIGITAL MONEY / ELECTRONIC CURRENCY / ELECTRONIC MONEY

News:
 2009:
→ Bitcoin (world’s 1st cryptocurrency) launched.
 2018:
→ RBI prohibits banks and financial institutions to give services related to cryptocurrencies.
 2020:
→ Supreme Court allows banks and financial institutions to give services related to cryptocurrencies.
 2021:
→ Corporate affairs ministry announces that companies will have to disclose any holding / dealings in cryptocurrencies
/ virtual currencies in their financial statements filed with Registrar of Companies.
→ Cryptocurrency and Regulation of Official Digital Currency Bill, 2021.
→ China’s digital currency – Digital RMB (Renminbi)
→ NPCI refuses to ban cryptocurrency transactions and instead gave banks choice whether to ban or not.
 Reason:
• NPCI’s decision is based on 2020 Supreme Court’s Judgment that set aside RBI’s directive to ban banks and
financial companies from dealing with virtual currencies or providing services to facilitate trading in
cryptocurrencies.
• Following said 2020 Supreme Court’s judgment, RBI has not come out with any directive about
cyrptocurreny.
→ China sets new rules that greatly expanded scope of prohibited services on cryptocurrencies. [China does not
recognise cryptocurrencies as legal tender and Chinese banking system does not accept cryptocurrencies or provide
relevant services].
→ El Salvador - small coastal country in Central America – makes Bitcoin legal, becoming 1st country in world.
 Reason:
• El Salvador (official currency is US dollar) depends heavily on remittances sent by Salvadorians abroad (>
20% of GDP). However, much remittances are lost to intermediaries. By using Bitcoin, amount received by
will not be lost to intermediaries - billions of dollars every year can be saved.
• Besides, Bitcoin will help in financial inclusion in El Salvador, because majority population does not have
bank accounts and relies on informal economy.

Page 417 of 719

 • Currently, El Salvador adopts US dollar as its official currency i.e. dollarized economy. El Salvador has no
monetary policy of its own and hence, no local currency to protect. El Salvador runs on monetary policy of
US Federal Reserve. Therefore, any changes in US Federal Reserve policies will definitely affect El Salvador.
Hence, El Salvador is looking at alternatives.
→ RBI has been working on phased implementation strategy for CBDC. Pilot may be launched by end of 2022
year.
→ G7 finance leaders lay out guidelines for CBDC.
→ El Salvador (only country to recognise Bitcoin as legal tender) is planning to build entire city based on Bitcoin (largest
cryptocurrency). El Salvador’s “Bitcoin City” would be funded by Bitcoin Bond. This city will be located along Gulf of
Fonseca near Conchagua volcano. [El Salvador is already running pilot Bitcoin mining venture at geothermal power
plant beside Tecapa volcano.]
→ IMF chief economist says cryptocurrencies are challenge (because they operate from offshore exchanges) for
emerging markets, thereby regulation is needed.
 2022:
→ Finance Minister Nirmala Sitharaman announces to launch Digital Rupee in 2022-23. [RBI will launch this Digital
Rupee later].
→ Finance Minister Nirmala Sitharaman, in her Budget 2022 speech, announces 30% tax on income from virtual digital
assets.
 Need: Rise in digital assets transactions and magnitude and frequency of digital assets transactions makes it
required to have specific tax regime.
 This 30% tax law does not mean that crypto assets have been legalised in India. That is, tax law can’t make
anything legal or illegal — it must be done via separate statute.
→ Non-fungible tokens (NFT) are gaining massive popularity now because they are becoming increasingly popular way
to showcase and sell digital artwork. [Billions of dollars have been spent on NFTs since its inception in 2015].
→ Supreme Court asks Centre whether dealing with cryptocurrencies like bitcoin is legal in India or not.
→ Sudden drop in value of Luna cryptocurrency, rendering it nearly useless, has sent shockwaves through
cryptocurrency market, with experts comparing crypto market disaster to 2008 financial crisis.
→ GOI (Income Tax Dept.) clarifies that TDS on virtual digital assets continues to be 1%.
→ Bitcoin and many other cryptocurrencies are crashing [after they had hit all-time high in 2021].
 Why:
• Tight monetary policy by governments across world: As central banks withdraw liquidity from market, there
is less money chasing assets, which in turn causes prices of assets to drop.
→ EU’s European Parliament agrees upon one new law to regulate cryptocurrencies - Markets in Crypto-Assets
(MiCA) law – 1 st comprehensive regulation for cryptos, and some expect it to become trendsetter for crypto
regulation globally. [This law seeks to address concerns like money -laundering, protection of consumers
and investors, accountability of crypto firms, stablecoins and environmental footprint of crypto mining.
However, it excludes NFT].
→ In written reply to Lok Sabha, FM Nirmala Sitharaman says that RBI has recommended for framing of
legislation on cryptocurrency and RBI is of view that cryptocurrencies should be prohibited in view of
destabilising effect of cryptocurrencies on monetary and fiscal stability of India. She further says that:
 RBI mentioned that cryptocurrencies are not currency because every modern currency needs to be issued by
central bank or government;
 Value of fiat currencies is anchored by monetary policy and their status as legal tender, however value of
cryptocurrencies rests solely on speculations and expectations of high returns that are not well anchored, so it
will have destabilising effect on monetary and fiscal stability of India.
 Cryptocurrencies are by definition borderless and require international collaboration to prevent regulatory
arbitrage. Therefore, she said, any legislation for regulation or for banning such currencies can be effective only
after significant international collaboration on evaluation of risks and benefits and evolution of common
taxonomy and standards. [RBI has recommended to government that it should frame regulations for
cryptocurrencies.]
→ RBI is in process of implementing CBDC in phased manner for wholesale and retail segments.
→ As per UNCTAD, Indians are 7 th (out of 20 global economies) in use of digital currency. Only 7.3% of
population in India owns digital currency.
→ Popular cryptocurrencies have decreased after meteoric rise in 2021. Several crypto exchanges laid off
significant portion of their employees and lending platforms are struggling to remain sol vent. Being part of
this ecosystem, NFTs also took hit as result of crypto fallout.
→ Ethereum, world’s 2 nd most valuable cryptocurrency, completes significant software overhaul / revamp -
‘The Merge’ - which promises to ramp up security of Ethereum cryptocurrency while claiming to cut down
on its carbon footprint, nearly entirely.
→ RBI releases one concept paper in which RBI says it will soon commence limited pilot launches of one central
bank backed digital rupee for specific use cases.

Page 418 of 719

 → OECD creates a new global tax transparency framework - Crypto-Asset Reporting Framework (CARF) - for the
automatic exchange of information related to crypto assets between countries.
About:
 What:
→ any currency, money, or money-like asset that is primarily managed, stored or exchanged on digital computer
systems, especially over internet.
→ Digital currency may be recorded on distributed database on internet, centralized electronic computer database
owned by company or bank, within digital files or even on stored-value card.
 Type:
→ Cryptocurrency / crypto:
 What:
• digital currencies in which encryption techniques are used to regulate generation of units of currency and
verify transfer of funds, operating independently of central bank. digital currency designed to work as
medium of exchange through computer network that is not reliant on any central authority (government or
bank), to uphold or maintain it. digital asset designed to work as medium of exchange wherein individual
coin ownership records are stored in ledger existing in form of computerized database.
 Feature:
• uses encryption techniques: to regulate generation of units of currency; and to verify transfer of funds.
operates independently of central bank. It works on / uses blockchain technology. It uses strong
cryptography to secure transaction records, to control creation of additional coins, and to verify transfer of
coin ownership. It typically does not exist in physical form (like paper money). typically not issued by central
authority. typically uses decentralized control.
 Example:
• Bitcoin [2009]:
 What:
o Decentralized digital currency, without central bank or single administrator, that can be sent from
user to user on peer-to-peer bitcoin network without need for intermediaries. electronic cash
system. online payment system to be sent directly from one party to another without going
through financial institution – RBI etc. world's most popular cryptocurrency.
 History:
o Satoshi Nakamoto - person or group of persons - are said to have conceptualized accounting
system in aftermath of 2008 financial crisis (global).
 Feature:
o Transactions are verified by network nodes through cryptography and recorded in public
distributed ledger called blockchain. Bitcoins are created as reward for process known as mining.
Bitcoins can be exchanged for other currencies, products, and services.
o Working Mechanism: From user’s perspective, bitcoin is like mobile app or computer program that
provides personal bitcoin wallet and allows him to send or receive Bitcoins. Bitcoin address -
destination of Bitcoin - remains anonymous.
o Transaction maintenance: publicly available; open ledger that records all transactions ever made;
anonymous form; encrypted form; This ledger is called blockchain.
 Drawback:
o misused in illegal transactions. large amount of electricity (carbon footprint) used by mining. price
volatility. thefts from exchanges.
 Will Bitcoin switch to proof-of-stake (PoS) consensus mechanism, like Ethereum?
o Highly unlikely! As they work differently. Also, Satoshi Nakamoto, pseudonymous creator of
Bitcoin, explicitly stressed importance of “proof-of-work” mechanism to secure Bitcoin blockchain.
Switching to PoS consensus mechanism would violate principles of decentralisation outlined in
Bitcoin white paper. It would also represent losses in millions of dollars for individual miners and
companies trying to solve puzzles that would reward them with BTC (Bitcoin).
 Significance:
o May weed out financial system corruption and financial system inefficiencies because of its public
and open nature of blockchain ledger.
• Ethereum:
 What:
o Ethereum is one decentralized, open-source blockchain with smart contract functionality. Ether is
native cryptocurrency of Ethereum platform. Among cryptocurrencies, Ether is 2 nd only to bitcoin
in market capitalization.
 History:
o Ethereum was conceived in 2013 by programmer Vitalik Buterin. In 2014, development work began
and was crowdfunded, and Ethereum network went live in 2015.
 Feature:
Page 419 of 719
 o Ethereum allows anyone to deploy permanent and immutable (unchanged) decentralized
applications onto it, with which users can interact. [Decentralized finance (DeFi) applications
provide broad array of financial services without need for typical financial intermediaries like
brokerages, exchanges, or banks, such as allowing cryptocurrency users to borrow against their
holdings or lend them out for interest].
o Ethereum also allows users to create and exchange NFTs, which are unique tokens representing
ownership of associated asset or privilege. Many other cryptocurrencies utilize ERC-20 token
standard on top of Ethereum blockchain and have utilized Ethereum platform for initial coin
offerings.
 Issue:
o Ethereum is one decentralised cryptocurrency, meaning that it does not have institutions like banks
approving transactions that happen on its network – approvals were earlier happening under PoW
consensus mechanism which was essentially done by miners. Miners would compete to solve
complex mathematical puzzles using massive infrastructure of cutting edge computer hardware,
and 1st one to solve puzzle would be chosen as validator. This method was almost entirely
dependent on crypto farms, which are massive warehouses lined with rows of computers which
would solve puzzles. There was, however, one big problem – these mining farms were energy
guzzlers (hungry), leading to one of biggest criticisms of crypto industry that they sometimes
consumed more electricity than entire countries, and were therefore one big concern in terms of
environmental sustainability. So, to solve this “The Merge” was created.
 Status:
o In 2022, Ethereum transitioned its consensus mechanism from proof-of-work (PoW) to proof-of-
stake (PoS) in upgrade process known as "The Merge".
 What next for Ethereum?
o In 2022, Ethereum’s co-founder Vitalik Buterin said that post ‘The Merge’, Ethereum network will
undergo further upgrades which he called “surge”, “verge”, “purge”, and “splurge”.
• …
 Arguments:
•
{Significance} {Drawbacks}
alternative hedging instrument to gold Regulatory bypass:
a. Central bank cannot regulate supply of
cryptocurrencies in economy. This could
pose risk to financial stability of country if
their use becomes widespread.
b. usually unregulated
Protection from threat of rise in inflation mined through complex process
Fund transfer between two parties will be easy Almost hidden nature of cryptocurrency
without need of 3rd party – credit / debit cards, transactions makes them easy to be focus of illegal
banks activities - money laundering, tax-evasion, terror-
financing etc.
cheaper alternative compared to other online Cryptocurrencies are not accepted everywhere and
transactions. have limited value elsewhere in world.
Payments are safe, secured and anonymous. Cryptocurrencies like Bitcoin are not rooted in any
material goods.
cryptocurrency systems come with user wallet / Criticism of legalization of Bitcoin:
account address which is accessible only by public a. Legalizing bitcoin in absence of central
key and pirate key regulating authority will induce fraud,
money laundering, high energy costs,
extreme volatility.
Private key is known only to owner of that wallet Sovereign guarantee:
a. Cryptocurrencies pose risks to
consumers. They do not have sovereign
guarantee and hence are not legal tender.
Fund transfer is completed with minimum Market volatility:
processing fee. a. Cryptocurrencies’ speculative nature also
makes them highly volatile. For example,
value of Bitcoin fell in 2018.
Corruption Check: Risk in security:
a. As blocks run on peer-to-peer network, it a. User loses access to his cryptocurrency if he
helps keep corruption in check by tracking loses his private key (unlike traditional
flow of funds and transactions.
Page 420 of 719
 digital banking accounts, this password
cannot be reset).
Time Effective: Malware threats
a. Cryptocurrencies can help save money and
substantial time for remitter and receiver,
as it is conducted entirely on Internet, runs
on mechanism that involves very less
transaction fees and is almost
instantaneous.
Cost Effective and savings: Misuse - Money laundering, Drug Trafficking,
a. Intermediaries (banks, credit card, Terrorist Financing, Weapon Proliferation, Cyber
payment gateways) draw fees. Crime.
Cryptocurrencies are very serious concern from
macro economic and financial stability point of view.
Power consumption:
a. Since validating transactions is energy-
intensive, it may have adverse
consequences for country’s energy
security. Example - total electricity use of
bitcoin mining in one year was about
equivalent to that of mid-sized economies
– Switzerland etc.
 Governments on cryptocurrencies:
• Many countries have taken several steps to discourage widespread use of cryptocurrencies. While
countries such as China, Russia have opted to impose outright bans on cryptocurrencies, others such
as India have tried to tax and regulate them heavily. In India, while government has not imposed
outright ban on cryptocurrencies, RBI has been quite vocal about need to ban them completely.
• RBI has been opposing private cryptocurrencies stating that they are threat to India’s
macroeconomic and financial stability.
→ Virtual currency / Virtual money:
 What:
• digital currency that is largely unregulated and issued and usually controlled by its developers and used and
accepted electronically among members of specific virtual community. European Banking Authority defines
it as digital representation of value that is neither issued by central bank or public authority, nor necessarily
attached to fiat currency. But, it is accepted by natural or legal persons as means of payment and can be
transferred, stored or traded electronically.
→ Central Bank Digital Currency (CBDC) / National Digital currency:
 What:
• digital fiat currency / digital base money. digital currency issued by central bank. digital form of fiat currency
of one country. Instead of paper currency or coins, central bank of that country issues electronic tokens.
This electronic token value is backed by government of that country.
 Need:
• India has high currency-to-GDP ratio (It adds to cost of printing, transporting and storing paper currency),
and this makes CBDC beneficial to India. Reduction in cost of currency management. real-time payments
without any inter-bank settlement.
 Feature:
• CBDC is not comparable with private virtual currencies or cryptocurrencies. CBDC will be sovereign-backed
digital currency.
 Benefit:
• Bring cultural shift towards virtual currency by reducing currency handling costs, universal access,
easier Cross-Border Payments, and greater financial Inclusion.
 Challenges:
• cybersecurity threat. Lack of digital literacy of population. challenges in regulation, tracking investment,
purchase, taxing individuals etc. Threat to Privacy of individual who holds digital currency.
 Status:
• As of 2022, 105 countries were exploring CBDC. 10 countries have launched CBDC, 1st of which was Sand
Dollar (Bahamas) in 2020, JAM-DEX (Jamaica).
 Significance:
• Central bank can pay pre-programmed CBDC to intended beneficiaries. It could be accepted only for specific
purpose. CBDCs could be used for faster cross-border remittance payments. Instant lending to MSMEs in

Page 421 of 719

 India can be possible with CBDC. Reduction in cost of printing. Reduction in cost of transporting currency.
Reduction in cost of storing paper currency. Inter-bank settlement would disappear.
 Legalization:
→ Globally:
 Countries with economic uncertainties are favouring cryptocurrencies. Cuba, Venezuela, Mexico are
preferring virtual tokens that are decentralised and unregulated. In 2021, El Salvador became 1st
country to make Bitcoin legal.
→ Criticism:
 Legalizing bitcoin in absence of central regulating authority will induce fraud, money laundering, high
energy costs, extreme volatility.
 India:
→ History:
 In 2009, Bitcoin (world’s 1st cryptocurrency) was launched. In 2013, RBI had issued note cautioning Indians about
financial, legal, security risks of cryptocurrency. In 2021, RBI’s opposition to crypto becomes stronger. RBI told
its board that ‘complete ban’ on crypto was needed because partial restrictions won’t work.
→ Regulation in India:
 2020 Supreme Court’s Judgment allowed banks and financial institutions to give services related to
cryptocurrencies and set aside RBI’s directive to ban banks and financial companies from dealing wit h
virtual currencies or providing services to facilitate trading in cryptocurrencies. Cryptocurrency and
Regulation of Official Digital Currency Bill, 2021, will prohibit all private cryptocurrencies and lay
regulatory framework for launch of official digital currency of India. In 2021, Corporate affairs ministry
announced that companies will have to disclose any holdings / dealings in cryptocurrencies / virtual currencies
in their financial statements filed with Registrar of Companies. Despite their proliferation as asset class, private
cryptocurrencies (Bitcoin etc.), which are unregulated, mined through complex process and have highly volatile
prices, are under regulatory gaze in India. RBI has always maintained strong stance against private digital
currencies. RBI had also banned banking system from aiding such trades, which was struck down by Supreme
Court in 2020.RBI concerns on cryptocurrencies traded in market: Sovereign guarantee, Market volatility, Risk
in security, Malware threats. Through Tax: India levied 30% tax on income from transfer of cryptos and added
1% TDS. Wait and watch: Indian regulators are also expected to consider rules being developed in USA before
taking concrete decisions.
→ Challenge:
 Unlike El Salvador, who legalized Bitcoin in 2021, India has its own currency and central bank - RBI. Therefore,
coexistence of legalized virtual currency / bitcoin and India rupee side by side will be difficult.
→ RBI:
 RBI has been cautioning users, holders and traders of Virtual Currencies (VCs) since 2013 at regular intervals that
dealing in VCs is associated with potential economic, financial, operational, legal, customer protection and
security related risks.
RBI had also issued circular in 2018 prohibiting its regulated entities to deal in VCs or provide services
for facilitating any person or entity in dealing with or settling VCs, though this circular was set aside by Supreme
Court in 2020.
Further, RBI in 2021 also advised its regulated entities to continue to carry out customer due diligence
processes for transactions in VCs, in line with regulations governing standards for - Know Your Customer (KYC),
Anti-Money Laundering (AML), Combating of Financing of Terrorism (CFT), obligations under PMLA, 2002, etc.
→ Present status:
 India is saying no to cryptocurrency. But, India is not going for outright ban of cryptos, in view of large
investments in crypto instruments by Indians. Ministerial panel on cryptocurrency recommended that all private
cryptocurrencies, except issued by state, should be prohibited in India. There’s no formal regulation on
cryptocurrencies in India so far. Centre has been working on crypto regulatory framework since 2019 but is yet
to introduce bill. Union government has not yet enacted any law on cryptocurrencies. On CBDC: In 2022-23
Budget, Finance Minister announced to launch Digital Rupee —central bank digital currency (CBDC) of India. GOI
amended RBI Act, 1934 through Finance Bill, 2022. India’s official digital currency is likely to debut by 2023.
→ Latest developments:
 In Union Budget 2022, finance minister Nirmala Sitharaman had proposed 30% tax on earnings from
cryptocurrencies, non-fungible tokens (NFTs). Finance Minister also said that losses from their sale could not be
offset against other income. This is one disincentive to trading and investment in digital assets. Government
introduced 1% tax deducted at source (TDS) on digital assets. Government also announced that RBI will
introduce its digital currency in FY23 that will lead to more efficient, cheaper currency management system. In
2022, in written reply to Lok Sabha, FM Nirmala Sitharaman said that RBI recommended for framing of legislation
on cryptocurrency and RBI was of view that cryptocurrencies should be prohibited in view of destabilising effect
of cryptocurrencies on monetary and fiscal stability of India.
→ Subhash Chandra Garg Committee [2019] [Recommendations]:

Page 422 of 719

  Ban anybody who mines, holds, transacts or deals with cryptocurrencies. Jail provision for exchange or
trading in digital currency. monetary penalty. However, government should keep open mind on
potential issuance of cryptocurrencies by RBI.
→ TDS on virtual digital assets:
 What:
• GOI applies taxation on gains arising from cryptocurrency assets (tax on income from virtual digital assets)
i.e. cryptocurrency taxations.
 Need:
• There has been phenomenal rise in such transactions and magnitude and frequency of these transactions
have made it imperative to provide for specific tax regime.
 Argument:
•
{for} {against}
GOI argues that tax on digital assets is useful in
tracing transactions and preventing tax evasion
 Issue:
→ Not sure if digital currencies should be considered as assets, commodities or capital gains. It is still not
clear if cryptocurrencies fall into category of assets. Government may need to amend existing laws to
include cryptocurrencies.
 Fact:
→ No intrinsic value: Similar to Fiat currency, Bitcoin (or most of cryptocurrencies) is also not backed by any
gold or silver hence does not have any intrinsic value. Value of any currency comes from backing of state
and trust that people have over government.
 Way Forward:
→ G7 guidelines on CBDC: Any digital currency issued by central bank: must support and must not harm /
infringe central bank’s ability to fulfil its mandate on monetary and financial stability; must meet rigorous
standards of privacy, transparency and accountab ility for protection of user data; and should be grounded
in public commitments to transparency, rule of law and sound economic governance.
→ GOI should enact consumer protection measures like payment guarantee, and dispute resolution. For this,
Cryptocurrency based businesses can be tested in regulatory sandboxes e.g. RBI’s regulatory sandbox for
Banks. Regulation of digital currency exchanges and administrators. In 2020, EU Commission officially
released Proposal for Regulation on Markets in Crypto -assets (“MiCA”). Banning cryptocurrencies might
drive crypto transactions underground. Awareness: Government should make public aware of
cryptocurrency and its threat. Allow framework for taxing digital currency transaction to avoid tax evasion.
Transactions: For now countries should ban retail cryptocurrency transactions or be used as financial
instruments (e.g. China, Belgium) or cryptocurrency transactions between banks. NASSCOM: NASSCOM
says that government should work towards developing risk -based framework to regulate and monitor
cryptocurrencies and tokens. Creation of CBDC will be +ve step as it can better control money supply (and
volatility) and also help in quick financial disbursal of budgeted sums based on smart contract. Creating
one cryptocurrency ecosystem by improving financial literacy, improving cybersecurity, and digital
penetration. Global governance through UN or FSBs to allow cross -border regulation and transparent
system of digital currency.
→ India needs one all-India Blockchain platform because digital infrastructure based on blockchain
technology will transform digital ecosystem in India and will enable future of digital services, platforms,
applications, content, and solutions.
→ Indian digital community, including fintech, academia, think tank s, and institutions, should focus on
supporting research in standards, interoperability, and efficient handling of current known issues with
distributed technologies, e.g., scalability and performance, consensus mechanisms, and auto -detection of
vulnerabilities.
Note:
 Blockchain Technology:
→ What:
 decentralized, distributed ledger that records provenance of digital asset. digital public ledger. one form of
distributed ledger.
→ Feature:
 Blockchain is growing list of records, called blocks, that are linked together using cryptography. Many blocks
form chain, with each additional block reinforcing blocks before it. Therefore, blockchains are resistant to
modification of their data because once recorded, data in any given block cannot be altered without altering all
subsequent blocks.
→ Working Mechanism:
 Transaction is requested. Transanction is broadcasted to Peer-to-peer (P2P) n/w of nodes(computers). N/W of
nodes validate transaction and user status via algorithms. Verified transaction - cryptocurrency, contracts,
Page 423 of 719
 records, other information – is combined with other verified transactions and creates new block of data. New
block of data is added to existing blockchain ledger – permanent and unalterable. Transaction is finished.
→ Case Study:
 Estonia is blockchain capital of world and uses blockchain infrastructure to verify and process all e-governance
services offered to public.
 China launched one program in 2020 called Blockchain-based Service Network (BSN) to deploy blockchain
applications in cloud at streamlined rate.
 Brazilian government launched Brazilian Blockchain Network to bring participating institutions into governance.
 Virtual Token / coin:
→ digital representation of value that can be digitally traded. functions as medium of exchange, unit of
account, or store of value. may represent other rights, as well.
 Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 [India]:
→ regulate cryptocurrency. prohibits all private cryptocurrencies. provides for official digital currency to be issued by
RBI.
→ Aim:
 to create framework for official digital currency issued by RBI; to prohibit all private cryptocurrencies in India.
 Luna cryptocurrency:
→ sister cryptocurrency of algorithmic stablecoin Terra.
 Stablecoin:
→ type of cryptocurrency. Tokens pegged to value of government-backed currency such as US dollar or commodities
like gold or silver. typically linked to existing government-backed currency like dollar, euro, yen. Thus, price
of stablecoins fluctuates very little[unlike high -profile cryptocurrencies like bitcoin, ethereum].
Stablecoins are useful because they allow people to transact more seamlessly in cryptocurrencies that
function as investments like Bitcoin. They form bridge between old -world money and new-world crypto.
Tether [2014] – 1 st stablecoin created and after which many other stablecoins are modeled. Tether (USDT)
and USD Coin (USDC) are two leading stablecoins.
 Digital asset:
→ What:
 anything that exists in digital format and comes with right to use. Data that do not possess right to use are not
considered digital assets.
→ Feature:
 It includes digital documents, audible content, motion picture, other relevant digital data that are currently in
circulation or are / will be stored on digital appliances like personal computers, laptops, portable media players,
tablets, data storage devices, telecommunication devices, etc.
→ Example:
 photography, logos, illustrations, animations, audiovisual media, presentations, spreadsheets, digital paintings,
word documents, electronic mails, websites.
→ Type:
 Real / physical digital assets:
• Example - digital gold, CBDC, traditional digital assets.
 Virtual digital assets:
• What:
 digital assets that are not real or physical. It does not include digital gold, CBDC, traditional digital assets.
It is specifically for cryptos, Decentralized finance (DeFi), Non-fungible token (NFT).
 Finance Act, 2022 defines "virtual digital asset" as:
o any information or code or number or token (not being Indian currency or foreign currency),
generated through cryptographic means or otherwise, providing digital representation of value
exchanged, with promise or representation of having inherent value, or functions as store of value
or unit of account including its use in any financial transaction or investment and that can be
transferred, stored or traded electronically;
o non-fungible token or any other token of similar nature
• Types:
 Crypto:
o Every native token of blockchain network, ERC 20s, DeFi tokens, altcoins, metaverse tokens.
 NFTs:
o digital NFTs that can be bought on NFT marketplaces through crypto.
 Decentralized finance (DeFi):
→ It offers financial instruments without relying on intermediaries (like brokerages, exchanges, banks) by
using smart contracts on blockchain.
 Non-Fungible Token (NFT):
→ What:

Page 424 of 719

  financial security consisting of digital data stored in blockchain. non-interchangeable unit of data stored on
blockchain. one-of-a-kind digital collectible. NFT is unique and can’t be replaced. NFTs are virtual tokens and
they can be songs, movies, artworks, photographs, social media posts, GIFs, anything else that can be stored
digitally. NFT is unique, irreplaceable token that can be used to prove ownership of digital assets like music,
artwork, tweets, memes. Anything that can be converted into digital form can be NFT. Everything from drawings,
photos, videos, GIF, music, in-game items, selfies, tweet can be turned into NFT, which can then be traded online
using cryptocurrency.
NFTs are digital assets whose ownership is verified through transaction records stored on blockchains.
Art work, digital avatars and accessorised monkeys are some of most commonly traded NFTs. Everything from
drawings, photos, videos, GIFs, music, in-game items, selfies, and even tweet can be turned into NFT, which can
then be traded online using cryptocurrency.
OpenSea (one American online NFT marketplace headquartered in New York City founded in 2017) is
said to be one of largest NFT marketplaces in existence. OpenSea was built on Ethereum blockchain to trade
NFTs.
→ Feature:
 NFT ownership is recorded in blockchain, and can be transferred by owner, allowing NFTs to be sold and traded.
NFTs typically contain references to digital files like photos, videos, audio. Because NFTs are uniquely
identifiable, they differ from cryptocurrencies, which are fungible. Market value of NFT is associated with digital
file it references. It can be sold and traded. NFTs do not restrict sharing or copying of underlying digital files, do
not necessarily convey copyright of digital files, and do not prevent creation of NFTs with identical associated
files.
→ Uniqueness of NFTs from other digital forms:
 NFT is backed by Blockchain technology. NFT transactions are recorded on blockchains with most NFTs being
part of Ethereum blockchain.
→ Working mechanism:
 NFT works on blockchain as it gives users complete ownership of digital asset. For example, if I’m sketch artist,
and if I convert my digital asset to NFT, what I get is proof of ownership, powered by Blockchain.
→ NFT vs Cryptocurrency:
 Cryptocurrency is currency and is fungible, i.e. it is interchangeable. For example, if I hold one crypto token, say
one Ethereum, then next Ethereum that I hold will also be of same value. NFTs are non-fungible, i.e. value of
one NFT is not equal to another NFT. Every art is different from other art, making it non fungible, and unique.
→ Concern:
 NFTs are used as speculative asset, and they have drawn increasing criticism for energy cost, carbon footprint
associated with validating blockchain transactions and their frequent use in art scams. NFTs have negative
impact on environment. In order to validate NFT transactions, crypto mining is done, which requires high
powered computers that run at very high capacity, affecting environment ultimately. NFT market has been
compared to Ponzi scheme (fraud scheme).
 Risks exist with buying NFTs: Many incidents of NFT scams have been reported like emergence of fake
marketplaces, unverified sellers often impersonating real artists and selling copies of their artworks for half
prices.

{Virtual digital assets} {Digital currencies}
In simple words, they basically mean cryptocurrencies, Digital gold, CBDC, any other traditional digital assets.
DeFi, NFTs.
 Digital rupee / e-rupee:
→ What:
 CBDC of India. Digital Rupee or e-Rupee is one planned digital version of Indian Rupee, to be issued by RBI as
one CBDC. This Digital Rupee was proposed in 2017 and will be launched in 2022-23 FY. Plan is to incorporate
distributed ledger into Digital Rupee.
e-rupee is akin to sovereign paper currency but in digital form, exchangeable at par with existing
currency and will be accepted as one medium of payment, legal tender, and safe store of value.
→ Feature:
 Like banknotes e-rupee will be uniquely identifiable and regulated by RBI. Liability lies with RBI. Plans include
online and offline accessibility. RBI will launch Digital Rupee for Wholesale catering to financial institutions for
interbank settlements and Digital Rupee for Retail for consumer and business transactions.
 e-rupee may be structured as u or ‘account-based’.
[Token-based CBDC: whosoever holds tokens at given point in time would be presumed to own them,
similar to banknotes. Person receiving token will verify that his ownership of token is genuine. It is preferred for
retail payments].
[Account-based system: It would require maintenance of record of balances and transactions of all
holders of CBDC and indicate ownership of monetary balances, similar to Bitcoins. Account-based CBDC as
intermediary verifies identity of account holder. It is more preferred for wholesale payments].
Page 425 of 719
 → Background:
 In 2022-23 Budget, Finance Minister announced that RBI shall launch digital rupee.
→ Feature:
 based on blockchain technology. RBI will issue this CBDC. It shall behave as legal tender same as currency issued
by RBI. However, it’s all digital. It shall serve as sovereign currency but in electronic form appearing as currency
in circulation. It can be exchanged for equivalent paper money (exchangeable).
→ Function:
 It shall serve as CBDC.
→ Status:
 In 2022, RBI released one concept paper in which RBI said it would soon commence limited pilot launches of one
central bank backed digital rupee for specific use cases.
→ Significance:
 Its introduction shall provide significant push to digital economy. It will lead to more cheaper and efficient
currency management system. This is India government’s bold and clear step towards decentralization
(responsibility in hands of people). It will push India towards loads of such innovations and better technological
advancements.
 E-rupee will remove Rs. 4,984.80 crore security printing cost borne by general public, businesses, banks, and RBI
on physical currency.
 ‘The Merge’:
→ What:
 It is one significant software overhaul / revamp done by Ethereum, world’s 2 nd most valuable
cryptocurrency. It will make transactions on Ethereum network extremely secure. It will also cut down
on its carbon footprint, nearly entirely. This revamp software will cast aside need for crypto miners
and gigantic mining farms, who had previously driven blockchain under one mechanism called ‘proof-
of-work’ (PoW). Instead, it has now shifted to one ‘proof-of-stake’ (PoS) mechanism that assigns
‘validators’ randomly to approve transactions and earn small reward. According to Ethereum
Foundation, one non-profit organisation dedicated to supporting Ethereum cryptocurrency and its
related technologies, this move to PoS will reduce ethereum’s energy consumption by nearly 99.95%.
→ Need:
 There was, one big problem in Ethereum cryptocurrency because mining farms were energy guzzlers,
leading to one of biggest criticisms of crypto industry that they sometimes consumed more electricity
than entire countries, and were therefore big concern in terms of environmental sustainability.
Ethereum’s website admitted that Ethereum crypto’s total annualised power consumption nearly
matches that of Finland while its carbon footprint is comparable to Switzerland’s. Enter ‘The Merge’
and shift to PoS consensus mechanism. Ethereum is still decentralised platform, but u nder this new
concept “The Merge”, it would not need miners and mining farms to authenticate transactions
anymore. Instead, one validator will be randomly assigned using algorithm from pool of people who
‘stake’ their coins, which essentially means pledging at least 32 Ethereum tokens on Ethereum
network. This would entirely eliminate need for miners on Ethereum network.
→ Importance:
 ‘The Merge’ will make transactions on Ethereum network extremely secure. [Attacker needs 51% of
Ethereum blockchain’s value to take control. With PoW, attacker needs on order of USD 5 billion,
which allows him to buy enough computers and transformers, conn ect all of them to Ethereum grid,
and then carry out attack. With PoS, attacker will need about USD 20 billion in economic security today
– and this is number expected to grow dramatically].
 It is also being seen as environmentally conscious move as Ethereum is expected to now consume 99%
or so less energy.
 Given that some of most popular applications of cryptocurrencies such as NFTs, Decentralised Finance
(DeFi) are based on Ethereum network, this overhaul could have far-reaching consequences in future.
 “Crypto-Asset Reporting Framework (CARF)” [2022]:
→ What:
 One new global tax transparency framework created by OECD for the automatic exchange of
information related to crypto assets between countries. CARF would make it possible for countries to
track the cross-border transfer of crypto assets.
→ Background:
 In 2021, G20 had mandated the OECD to develop a framework for the automatic exchange of tax -
relevant information on crypto assets.
→ Need:
 Regulators and tax authorities around the world have been strug gle to deal with the burning question
of tracking, regulating and taxing crypto transactions given the proliferation and increasing dispersion
of this form of exchange.

Page 426 of 719

  Some countries have been concerned about the potential misuse of crypto assets to fuel money
laundering.
 Crypto assets are by definition borderless and it requires cross -border collaboration to prevent its
misuse and regulate them properly.
→ Impact on India:
 India has introduced a 30% tax on gains made from cryptocurrencies in Budget 2022 -23. Now with
CARF in place, India can frame its overarching taxation and regulatory framework for crypto assets.
Value Addition:
 Terra Nulius:
→ 1st NFT on Ethereum Blockchain. This project was merely idea which only allowed to customise short
message which was then recorded on blockchain.
 Bitcoin Maximalism:
→ Bitcoin maximalists believe that Bitcoin is only digital asset that will be needed in future. Bitcoin
maximalists believe that all other digital curren cies are inferior to Bitcoin. Bitcoin maximalist ideology
holds that other cryptocurrencies are not in line with ideals established by pseudonymous Satoshi
Nakamoto.
 IOTA Tangle:
→ distributed ledger technology (DLT) specifically designed for Internet of Things (IoT) environment. open-source
distributed ledger technology (DLT) and cryptocurrency designed for Internet of things (IoT). uses directed
acyclic graph to store transactions on its ledger. does not use miners to validate transactions, and instead,
nodes that issue new transaction on network. Therefore, transactions can be issued without fees, and thus
facilitating microtransactions. IOTA network is currently centralized. operated by IOTA Foundation.
 In 2020, National Informatics Centre (NIC) set up one Centre of Excellence (CoE) in Blockchain Technology in Bengaluru,
which will provide Blockchain as service and allow stakeholders to benefit from shared learning, experiences and
resources.
Question:
 NFTs enable digital representation of physical assets. They are unique cryptographic tokens that exist on
blockchain.
 “Blockchain Technology”, is one public ledger that everyone can inspect, but which no single user controls. Blockchain is
one shared, immutable ledger that facilitates process of recording transactions and tracking assets in business network.
Asset can be tangible (house, car, cash, land) or intangible (intellectual property, patents, copyrights, branding). It is free
and can be used to develop several applications including cryptocurrency. Applications that depend on basic features of
blockchain can be developed without anybody’s permission. Structure and design of blockchain is such that all data in it
are not only about cryptocurrency.
Mains Link:
 “Cryptocurrency will lead the next phase of the digital revolution. India must not miss the bus.” Critically examine. (15M)
 What is a cryptocurrency? Discuss the need for the formulation of a clear, constructive, and adaptive regulatory
environment for cryptocurrencies in India. (15M)
 Critically Examine the need for central bank digital currency (CBDC) in India’s economy.
 Analyze the potential of blockchain technology in transforming the public sector works and citizen service delivery. (15M)

INSOLVENCY AND BANKRUPTCY

News:
 2019:
→ Government allows creditors [financial institutions, banks etc.] to move against personal guarantors under
Indian Bankruptcy and Insolvency Code (IBC), 2016.
 2021:
→ Supreme Court upholds aforementioned 2019 Government notification that allowed creditors [financial
institutions, banks etc], to move against personal guarantors under Indian Bankruptcy and Insolvency Code
(IBC), 2016. That is, Supreme Court says personal guarantors are liable for corporate debt.
 Reason: Supreme Court says there is “intrinsic connection” between personal guarantors and their corporate
debtors.
 Implications: Lenders can now initiate insolvency proceedings against: personal guarantors [usually
promoters of big business houses]; and stressed corporate entities [for whom personal guarantors
gave guarantee].
→ Insolvency and Bankruptcy Code (Amendment) Bill, 2021 proposes pre-packs [Pre-packaged Insolvency
Resolution Process (PPIRP)] as insolvency resolution mechanism for MSME.
→ Insolvency and Bankruptcy Code (Amendment) Bill, 2021 passed by Lok Sabha and RS.
→ Parliamentary panel report says many cases are pending before IBC tribunals.
→ Supreme Court says “judicial delay” is main reason for failure of insolvency regime in India prior to 2016
IBC.

Page 427 of 719

 → Supreme Court urges company law tribunals to strictly adhere to timelines under 2016 IBC law and clear
pending resolution plans.
 2022:
→ Economic Survey 2021-22 highlights need for “standardised framework for cross -border insolvency” that
will help lenders of debt-ridden companies to claim and recover corporations’ assets and liabilities on
foreign shores also.
→ Economic Survey 2021-22 survey mentions report of 2020 Insolvency Law Committee, which had
recommended adoption of UNCITRAL with certain modifications to bring foreign assets under i nsolvency
process.
 Need: 2016 IBC currently does not allow for automatic recognition of any insolvency proceedings in other
countries. And present provisions lead to uncertainty of outcomes of claims for creditors, debtors, other
stakeholders as well.
→ Ministry of Corporate Affairs (MCA) revises rules on voluntary winding up of companies to give additional
opportunities to companies for making case for exit through electronic filing after initial request. [Idea is
to make corporate exit process under Companies Act, outside Insolvency and Bankruptcy Code (IBC),
smoother. This move seeks to improve business climate because ease of exit is one consideration for many
entrepreneurs before they commit investments].
→ IBBI amends Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 and
Insolvency and Bankruptcy Board of India (Voluntary Liquidation) Regulations, 2017: IBBI notifies
Insolvency and Bankruptcy Board of India (Liquidation Process) ( 2 nd Amendment) Regulations, 2022
(‘Amendment Liquidation Regulations’) and Insolvency and Bankruptcy Board of India (Voluntary
Liquidation Process) (2 nd Amendment) Regulations, 2022 (‘Amendment Voluntary Liquidation
Regulations’).
→ GOI creates exclusive benches to deal with cases above Rs. 100 crore at Debts Recovery Tribunals (DRT) in
Chennai, Mumbai and Delhi, agreeing to a long-standing demand by banks to get more focus on high -value
cases. [High-value cases are those with amounts more than Rs 100 Crore. They constitute just 1% of cases
but have nearly 80% of the claim value].
→ Till June 2022, 786 applications have been filed to claw back Rs 2,21,104 crore allegedly lost through
irregular transactions by firms undergoing the Corporate Insolvency Resolution Process (CIRP). If this value
is retrieved fully, several firms would be rescued.
About:
 Insolvency:
→ In accounting, insolvency is state of being unable to pay debts, by person or company (debtor), at maturity.
→ Those in state of insolvency are said to be insolvent.
→ Two forms: cash-flow insolvency; and balance-sheet insolvency.
 Bankruptcy:
→ legal process through which people or other entities who cannot repay debts to creditors may seek relief
from some or all of their debts.
→ In most jurisdictions, bankruptcy is imposed by court order, often initiated by debtor.
→ Bankrupt is not only legal status that insolvent person may have, and thus term bankruptcy is not synonym
for insolvency.
 Debt recovery:
→ Intro:
 Recovery of Debts and Bankruptcy Act, 1993 provides speedy redressal to lenders and borrowers through filing
of original applications in Debts Recovery Tribunal (DRT) (estd. under this Act) and appeals in Debts Recovery
Appellate Tribunal (DRAT) (also estd. under this Act).
The SARFAESI Act, 2002 provides access to banks and financial institutions covered under the Act for
recovery of secured debts from the borrowers without the intervention of the Courts at the 1 st stage.
Securitisation Appeals (SAs) can be filed with the DRTs by those aggrieved against action taken by secured
creditors under SARFAESI Act.
→ Status:
 At present, there are 39 DRTs and 5 DRATs that work under Recovery of Debts and Bankruptcy Act 1993.
 and It also hears cases under SARFAESI Act 2002.
→ Debts Recovery Tribunal (DRT):
 Issue:
• High pendency of cases. Over 2 lakh crore are pending at DRTs for resolution.
 Function:
• DRTs work under Recovery of Debts and Bankruptcy Act 1993.
• DRTs also hears cases under SARFAESI Act, 2002.
→ Debts Recovery Appellate Tribunal (DRAT):
 Function:

Page 428 of 719

 • DRATs work under Recovery of Debts and Bankruptcy Act 1993.
• DRATs hear appeals against DRT orders.
 Irregular transaction:
→ Irregular transaction refers to a transaction initiated or concluded by the Agent outside the permitted or
agreed on procedure and policy.
→ IBC Code, 2016 mentions 2 types of irregular transactions and they are:
 Avoidance transactions: Avoidance transactions are the 1st set of transactions. They comprise preferential
transactions, undervalued transactions and extortionate transactions.
IBC mandates the liquidation process to disregard Avoidance transactions.
 Fraudulent transactions: Fraudulent transactions are the 2nd set. They comprise fraudulent trading or wrongful
trading.
IBC requires the liquidation process to recover the loss made through Fraudulent transactions.
→ Till June 2022, 786 applications have been filed to claw back Rs 2,21,104 crore allegedly lost through
irregular transactions by firms undergoing the Corporate Insolvency Resolution Process (CIRP). If this value
is retrieved fully, several firms would be rescued.
→ In a landmark judgment in Anuj Jain vs Axis Bank Ltd (2020), the Supreme Court upheld the recovery of 758 acres of
land valued at over Rs 5,300 crore, which was lost through irregular transactions.
 Insolvency and Bankruptcy Code (IBC) [2016]:
→ What:
 bankruptcy law of India that consolidated then existing laws by creating this single law for insolvency and
bankruptcy. It consolidates then existing laws and forms common forum for debtors and creditors of all classes
so as to resolve insolvency. It was introduced to tackle bad loans and solve insolvencies.
→ Aim:
 streamline and speed up resolution process of failed businesses.
→ Feature:
 IBC mandates 330-day time limit for conclusion of Corporate Insolvency Resolution Process (CIRP).
→ Institutions created / to be created by IBC 2016 to facilitate resolution of insolvency:
 Insolvency Professionals:
• licensed professionals who will administer resolution process, manage assets of debtor.
 Insolvency Professional Agencies:
• insolvency professionals will be registered with insolvency professional agencies.
• Insolvency Professional Agencies will conduct examinations to certify insolvency professionals
• Insolvency Professional Agencies will enforce code of conduct for insolvency professionals
 Information Utilities:
• Creditors (banks, FI etc) will report financial information about debts owed to them by debtors. It includes
records of debt, records of liabilities, records of defaults.
 Adjudicating authorities:
• Proceedings of resolution process will be adjudicated by: National Company Law Tribunal (NCLT) - for
companies; and Debt Recovery Tribunal (DRT) - for individuals.
 Insolvency and Bankruptcy Board (IBB):
• To regulate: insolvency professionals, insolvency professional agencies, information utilities.
• Member: Representatives of RBI, representatives of Ministry of Finance, representatives of Ministry of
Corporate Affairs and Law.
→ Issue:
 2016 IBC currently does not allow for automatic recognition of any insolvency proceedings in other countries.
And present provisions lead to uncertainty of outcomes of claims for creditors, debtors, other stakeholders as
well.
 Delays in concluding insolvency in India:
• Delay reasons:
 Delay in approving resolution plan by NCLT (adjudicating authority)
 National Company Law Appellate Tribunal (NCLAT) is taking lots of time in admitting Corporate
Insolvency Resolution Process (CIRP).
 Multiplicity of litigation.
 Appeals to NCLAT
 Appeals to Supreme Court.
• Delay impacts:
 Delay in approving resolution plan by NCLT affects subsequent implementation of resolution plan.
 impact on commercial assessment that parties undertake
 commercial uncertainty
 degradation in value of corporate debtor
 inefficient and expensive insolvency process.

Page 429 of 719

 → Fact:
 IBC does not deal with partnerships or family firms. IBC deals only with companies.
 Initiative:
→ In a landmark judgment in Anuj Jain vs Axis Bank Ltd (2020), the Supreme Court upheld the recovery of 758 acres of
land valued at over Rs 5,300 crore, which was lost through irregular transactions.
 Way Forward:
→ Economic Survey 2021-22 survey mentions report of 2020 Insolvency Law Committee, which had
recommended adoption of UNCITRAL with certain modifications to bring foreign assets under insolvency
process.
Note:
 Pre-packs:
→ What:
 insolvency resolution mechanism
 Pre-pack is agreement for resolution of debt of distressed company through agreement between secured
creditors and investors, and not through public bidding process.
 popular mechanism for insolvency resolution in UK, Europe.
 In India, such system will require agreement between financial creditors and investors, and approval from
National Company Law Tribunal (NCLT).
→ Need:
 Slow progress (delay) in resolution of distressed companies
 Prolonged litigation is one major reason for delays
→ Significance:
 Pre-pack mechanism is effective in arriving at quick resolution for distressed companies.
→ Way Forward:
 Pre-pack mechanism should be rolled out to all corporations over time because currently legal issues are settled
through case law.
 Voluntary winding up:
→ Voluntary liquidation is one self-imposed wind-up and dissolution of company that has been approved by
its shareholders. Such decision will happen once company's leadership decides that that company has no
reason to continue operating. It is not ordered by court ( not compulsory).
→ Voluntary winding up offers opportunity for companies with little economic activity to down their shutters
outside IBC process. This is vital for industry as many entrepreneurs remain unable to commence business
operations for various economic reasons after incorporating company.
 Insolvency and Bankruptcy Board of India (IBBI):
→
Value Addition:

{Insolvency} {Bankruptcy}
situation legal state
not in state to pay off debts if one is declared bankrupt, then one have to pay off one’s
debts by either selling off one’s assets, or by restructuring
payment processes with governments’ help.
state of being unable to pay off debts conclusion of being unable to pay off debts
not all insolvencies lead to declaration of bankruptcy Bankrupt can become insolvent.
If untreated, insolvencies can lead to bankruptcies If untreated, insolvencies can lead to bankruptcies.
 Keep and Pay:
→ One type of bankruptcy exemption. It lets person keep asset – house, car etc. - provided that he continues
to make payments.
Mains Link:
 Discuss how suspension of initiation of fresh insolvency proceedings will help shield companies impacted by the outbreak
of Covid-19.

LEFT WING EXTREMISM (LWE) [INDIA]

News:
 2022:
→ MHA says Naxal violence reduced by 77% in 2021, from all -time high in 2009. Reasons for decline: Steadfast
implementation of national policy and action plan to address LWE.
→ Bihar free of Naxal presence; fight is in last stages in Jharkhand: Kuldiep Singh, Director-General, CRPF says Bihar is
free of LWE now and security forces have made inroads into areas in Jharkhand that were once inaccessible due to
presence of Maoists. He further says hotbeds of LWE have been cleared in 3 States; and Operation Octopus,
Operation Double Bull, Operation Thunderstorm, Operation Chakarbandha led to arrest or surrender of 592 Maoists.

Page 430 of 719

About:
 What:
→ LWE is one form of armed insurgency against state motivated by leftist ideologies. Naxalite–Maoist
insurgency, officially referred to as Left Wing Extremism (LWE), is one ongoing conflict between Maoist
groups known as Naxalites or Naxals (one group of communists supportive of Maoist political sentiment
and ideology) and Indian government.
Naxalites are group of far-left radical communists, supportive of Maoist political sentiment and
ideology. Their origin can be traced to splitting in 1967 of CPI (Marxist), leading to formation of CPI
(Marxist–Leninist).
Naxalites have frequently targeted tribal, police, government workers in what they say is fight for
improved land rights and more jobs for neglected agricultural labourers and poor.
Armed wing of Naxalite–Maoists is called People's Liberation Guerrilla Army (PLGA) and is estimated
to have between 6,500 and 9,500 cadres in 2013, most ly equipped with small arms. Naxalites claim that
they are following strategy of rural rebellion similar to protracted people's war against government.
 History:
→ Maoists insurgency started after 1967 Naxalbari uprising led by Charu Majumdar, Kanu Sanyal, Jangal
Santhal. Their origin can be traced to Communist Party of India (Marxist) split in 1967, leading to creation
of CPI (Marxist–Leninist). After in-party fighting and counter-measures taken by government, CPI(ML) split
into many smaller factions carrying out terrorist attacks mostly in Red corridor areas.
 Location:
→ Influence zone of LWE is called Red corridor, which has been steadily declining in terms of geographical
coverage and number of violent incidents, and in 2021 it was confined to 25 most affected locations
(accounting for 85% of LWE violence) and 70 total affected districts (down from 180 in 2009) ac ross 10
States in two coal-rich, remote, forested hilly clusters in and around Dandakaranya-Chhattisgarh-Odisha
region and tri-junction area of Jharkhand-Bihar-WB.
Naxalism is largely active in tribal and rural areas of India which are remote and under -developed, and
experts have advocated ethical governance, development and security as solution.
 Cause:
→ Governance deficit: Incompetent, ill-trained and poorly motivated public personnel, mismanagement and
corruption, poor implementation of laws, schemes.
→ Development deficit: Unemployment, poverty, infrastructure deficit, lack of education, poor health
facilities, low trade / marketing.
→ Social exclusion: Violation of human rights, abuse of dignity of life, disconnect with mainstream society,
discontent against government.
→ Jal-Jangal-Jameen / Exploitative Deficit (Environmental): Evasion of land ceiling laws, encroachment and
occupation of government and community lands, disruption of age -old tribal forest relationship.
→ D Bandopadhyay Committee in 2006 identified socio-political, economic, and cultural discrimination
against Scheduled castes and tribes and lack of their empowerment as reason for spread of Naxalism.
 Initiative:
→ Zero tolerance for terrorism and LWE. Increased allocation of funds and latest equipmen t.
→ Soft policing: Winning trust of locals to shun violence.
→ Government approach to Infrastructure, Good Governance:
 SAMADHAN doctrine: It is one one-stop solution to fight LWE, encompassing entire strategy of government from
short-term policy to long-term policy formulated at different levels.
 Aspirational District: Collaborative, bottom-up convergence-based developmental approach in many LWE-
affected districts.
 Special Infrastructure Scheme (SIS) to construct fortified police stations.
 Road Connectivity Project for construction of thousands of kms of roads.
 Telecom connectivity: Installation of Mobile Towers for endless telecom connectivity.
 Financial inclusion: For ensuring presence of banking facilities within 5 km to all citizens residing in LWE-affected
areas.
 Chhattisgarh govt. proposed one action plan to make Baster region free of Maoism / Naxalism by giving grants
to make cold storage chains for arranging processing and sale of minor forest produce, forest medicines, and
several types of horticultural crops in forest areas, building steel plant in area etc.
→ Government approach to commerce, education, health, environment:
 Van Bandhu Kalyan Yojana [Min. of Tribal] for holistic development of tribal people by targeting their education,
employment, trade of minor forest produce, healthcare, infrastructure, connectivity.
 Civic Action Plan: Each CRPF company is given Rs. 3 lakh for holding medical camps, sanitation drives, sports
meets, distribution of study material to children, minor repairs of school buildings, roads, and bridges to build
confidence among locals.
 GOI is organizing extensive training and capacity-building programs for State service officials for implementation
of FRA, 2006, PESA Act, 1996.
Page 431 of 719
  Skill Development for construction of many ITIs (1 ITI per district) and many Skill Development Centers (2 SDCs
per district) by 2018-19. Roshani Scheme: Skill development program for Tribal population by Ministry of Rural
Development.
 Education Initiatives for building new Kendriya Vidyalayas (KVs), Jawahar Navodaya Vidyalayas (JNVs) where
they are not present. It is also planned to open more schools under Eklavya model.
 Residential schools for children (e.g. Pota Cabins, Choolo Aasman, Nanhe Parinde, Tamannah) as well as focus
on sports infrastructure.
 Status:
→ In 2022, MHA said Naxal violence reduced by 77% in 2021, from all -time high in 2009. Reason for decline
was steadfast implementation of national policy and action plan to address LWE. MHA also said fa talities
among civilians and security forces declined by 85% (between 2010 to 2021). Geographical spread of
Maoists’ influence was shrinking. Number of districts covered under Security Reimbursement Expenditure
(SRE) scheme also came down.
→ In 2022, number of districts affected by violence stood at 39, down from 60 in 2010. These districts are
mostly in Chhattisgarh, Jharkhand, Odisha, Maharashtra, Telengana, Andhra Pradesh. Incidents of violence
have come down from highest level of 2,258 in 2009 to 509 in 2 021. Death rate due to violence has come
down by 85%.
 Way Forward:
→ Naxalism is largely active in tribal and rural areas of India which are remote and under -developed, and
experts have advocated ethical governance, development, and security as solution.
Note:
 Naxalbari uprising [1967]:
→ It was one armed peasant revolt in 1967 in Naxalbari block of Siliguri subdivision in Darjeeling district,
West Bengal, India. It was mainly led by tribals and radical communists leaders of Bengal and further
developed into Communist Party of India (Marxist–Leninist) in 1969. This armed struggle became one
inspiration to naxalite movement which rapidly spread from WB to other States of India creating division
within in to CPI(M) Party.
 Security Related Expenditure (SRE):
→ It is GOI’s one Non-Plan scheme for reimbursement of Security Related Expenditure (SRE) for States
seriously affected by militancy / insurgency. This scheme is being implemented in all States of affected
region except Mizoram, Sikkim. Under it, expenditure incur red by them on various items, including raising
of India Reserve Battalions, logistics provided to CPFs / Army deployed in State, ex -gratia grant and
gratuitous relief to victims of extremist violence, 75% of expenditure incurred on POL (petrol, oil,
lubricants) in operations and honorarium, paid to village guards / village defence committees / home
guards deployed for security purposes, expenditure incurred on maintenance of designated camps set up
for groups with whom Central Government / State Government s have entered into agreement for
Suspension of Operations, is being reimbursed.
Mains Link:
 The menace of Left-wing extremism which is the single largest internal security threat in India is on a decline. It is indeed
welcome news but the Maoist threat remains a potent challenge to be overcome. Discuss. (250 words)

BIOFUEL
News:
 2022:
→ Indian Sugar Mills Association (ISMA) calls for faster launch of flex -fuel vehicles (FFV) to achieve 20% of
ethanol blending.
→ Union Cabinet approves amendments to National Policy on Biofuels, 2018.
 Main amendments approved:
• To allow more feedstocks for production of biofuels.
• To advance ethanol blending target of 20% blending of ethanol in petrol to Ethanol Supply Year (ESY) 2025-
26 from 2030.
• To promote production of biofuels in India, under Make in India program, by units located in SEZ / Export
Oriented Units (EoU).
• To add new members to National Biofuel Coordination Committee (NBCC).
• To grant permission for export of biofuels in specific cases.
• To delete / amend certain phrases in National Policy on Biofuels, 2018 in line with decisions taken during
meetings of NBCC.
→ PM Modi says that India has achieved 10% ethanol blending ahead of deadline.
→ India’s Reliance Industries Ltd releases one short video on social media platform Instagram highlighting cutting-edge
algae-to-fuel technology it has developed. This company has been successfully running large algae raceway ponds
last 5 years at their facility near Jamnagar, Gujarat, to convert sunshine, CO2 and seawater into bio-oil.
About:
Page 432 of 719
 What:
→ Hydrocarbon fuel produced from organic matter - living or dead material -in short duration (days, weeks,
months)
 Types in nature:
→ Solid Biofuel:
 Wood
 dried plant material
 manure
→ Liquid Biofuel:
 Bio-ethanol
 Bio-diesel
→ Gaseous:
 Biogas
 Classification:
→ Primary Biofuel:
 Firewood
 Animal waste
 Forest and crop residue
 Landfill gas
→ Secondary Biofuel:
 1st Generation biofuel (conventional biofuel):
• Any biofuel – bioethanol, biodiesel etc. - made from food crop
 starch – wheat, barley, corn, potato, sugar etc.
 oil crops – cooking oil, animal fats etc.
 2 Generation biofuel (advanced biofuel):
nd

• Any biofuel - made from woody biomass or agricultural residues:

 Straw
 Bagasse
 Grasses
 Jatropha
 waste vegetable oil
 municipal solid waste etc.
• Usually not from food crop.
 3rd Generation biofuel:
• Any biofuel derived from algae.
 4th Generation biofuel:
• directly converting available solar energy to fuel
• Ex. solar fuels and electrofuels.
 Ethanol:
→ What:
 also called ethyl alcohol, grain alcohol, drinking alcohol, simply alcohol
 organic chemical compound.
 Biofuel obtained primarily from sugarcane.
 organic compound Ethyl Alcohol which is produced from biomass.
→ Source:
 Ethanol can be produced from sugarcane, maize, wheat, etc which have high starch content.
→ Feature:
 Volatile
 Flammable
 colorless liquid
 wine-like odor and pungent taste
 psychoactive drug
 recreational drug
 active ingredient in alcoholic drinks
→ Formation:
 Ethanol is naturally produced by fermentation of sugars by yeasts or via petrochemical processes like ethylene
hydration.
→ Usage:
 medical applications as antiseptic, disinfectant.
 as chemical solvent
 in synthesis of organic compounds.
Page 433 of 719
  It is also ingredient in alcoholic beverages.
 Ethanol as fuel source:
• This biofuel/ renewable fuelis obtained primarily from sugarcane.
• It is by-product of biomass left by agricultural feedstock i.e. high starch content like:
 Sugarcane
 Potato
 grains - barley, wheat, maize, corn, rice etc
• Ethanol is renewable fuel because ethanol is produced from plants that harness Sunlight.
• In India, ethanol is mainly produced from sugarcane molasses by fermentation process.
→ Ethanol blending:
 What:
• Process of blending fuel with ethanol. Ethanol is blended through separate pumping and metering
mechanism.
• Ethanol can be mixed with gasoline to form different blends.
• India targets 20% ethanol blending in petrol by 2025.
 Ethanol blended fuel:
• Aim:
 alternative and environmentally friendly fuels
• Types:
 E20 fuel:
o Fuel blended with 20% of ethanol and gasoline.
• Step:
 Crop -> Fermentation -> Purification -> Ethanol -> Blending -> Transportation -> Fuel Station.
• Fact:
 One blended, ethanol cannot be separated from petrol.
 Challenges:
• Compatibility of vehicles. 10% blend does not necessitate major engine changes, but 20% blend may
necessitate certain changes and may even raise vehicle prices.
• More blending may imply more land being diverted for water-intensive crops like sugarcane.
• Lack of adequate quality feedstock across India because feedstock supply is primarily concentrated in sugar-
producing States at present.
• Ethanol demand of X billion litres by 2025 will require X million tonnes of sugar and grains per annum by
2025.
• Increased allocation of land also puts into question actual reduction in emissions that blending ethanol with
petrol brings about.
• Some dealers say since ethanol can absorb moisture from atmosphere, it can cause issues with vehicle
engines.
 Benefits:
• Reduction in vehicular emissions - C02, hydrocarbons etc.
• As ethanol contains oxygen molecules, it allows engine to completely combust fuel and thus fewer
emissions, reducing environmental pollution.
• Reduce dependence on fossil fuel.
• Reduction in oil import and saves foreign exchange [as India meets more than 80% of its crude oil
requirements through imports.]
• Increased energy security.
• India has surplus produce of corn, sugar, wheat, and thus mandatory blending of ethanol programme will
help farmers in realising higher incomes.
• Better air quality.
• Self-reliance.
• Better use of damaged foodgrains.
• Increased farmers’ incomes and greater investment opportunities.
 Initiative:
• Procedure for procurement of ethanol under EBP is simplified to streamline entire ethanol supply chain and
remunerative ex-depot price of ethanol is fixed.
• To facilitate achieving of new blending targets, one “grid” which networks distilleries to Oil Marketing
Companies (OMC) depots and details quantities to be supplied is worked out.
• State-wise demand profile is projected, keeping in view distances, capacities, other sectoral demands.
• Government of India has advanced target for 20% ethanol blending in petrol (also called E20) to 2025 from
2030.
• Government allowed production of ethanol from multiple feedstocks like sugarcane, food grain based raw-
materials
Page 434 of 719
 • Government fixed ex-mill price of ethanol from sugarcane based raw-materials.
• Remunerative prices of ethanol produced from different feedstock is fixed.
• Government notified interest subvention schemes for setting up of molasses, grain based distilleries.
• Sugar mills, distilleries are free to set up ethanol plants after obtaining statutory clearances.
• FCI surplus rice to be converted into ethanol:
 Use:
o alcohol-based hand-sanitizers
o blending in petrol.
• Ethanol Blended Petrol (EBP) Programme.
• National Policy on Biofuels, 2018.
 Status:
• As of 2021, India had attained 9.45% ethanol blend. By 2022, this is expected to touch 10%.
 Significance:
• Since most petroleum products are used in transport, successful E20 (20% ethanol blended petrol)
programme can potentially save India USD 4 billion per annum.
→ Significance:
 It has higher octane number than gasoline, hence improves petrol octane number.
 Since ethanol contains oxygen, it is supposed to help in complete combustion of fuel, resulting in lower
emissions.
 Algae-to-fuel:
→ Algae came to limelight in world’s fight against climate change about decade ago for its vast benefits in industrial
production. It can synthesise large volumes of oil (20 times more than that of mustard per acre), grow fast (10 times
quicker than terrestrial plants) and capture CO2. Since then, big industries and startups around globe have been
working to commercialise algae-based biofuel processes to reduce dependence on conventional fossil fuels like
petrol and diesel.
India’s Reliance Industries Ltd released one short video in 2022 on social media platform Instagram highlighting
cutting-edge algae-to-fuel technology it has developed. This company has been successfully running large algae
raceway ponds last 5 years at their facility near Jamnagar, Gujarat, to convert sunshine, CO2 and seawater into bio-
oil.
 Government initiative:
→ blending of biofuels
→ price mechanism for ethanol
→ Ethanol Blended Petrol (EBP) Programme.
→ National Policy on Biofuels, 2018.
 Significance:
→ Swachh Bharat Abhiyan
→ Skill Development
→ doubling of Farmers Income
→ Import Reduction
→ Employment Generation
→ Waste to Wealth Creation.
Note:
 Ethanol Blended Petrol (EBP) Programme [2003]:
→ What:
 blending of ethanol in petrol to promote use of alternative and environment-friendly fuels and to reduce import
dependency for energy requirements.
→ Background:
 Under Ethanol Blended Petrol (EBP) Programme, Government is promoting use of ethanol as blend stock with
main automotive fuel like petrol in line with National Policy on Biofuels (NBP), 2018.
→ Aim:
 blending of Ethanol for use in motor vehicles
 This policy envisages an indicative target of blending 20% ethanol in petrol by 2025.
 reducing pollution
 conserve Forex
 enable sugar industry to clear cane price arrears of farmers.
→ Need:
 During surplus production of sugarcane, prices are low. And thus, sugar industry is unable to make timely
payment of cane to farmers.
 Pollution
 Forex
→ Purpose:
Page 435 of 719
  address environmental concerns due to fossil fuel burning
 remuneration to farmers
 decrease crude imports
 forex savings.
→ Ethanol Production:
 Ethanol is agro-based product, mainly produced from by-product of sugar industry i.e. molasses
→ Target:
 10 % blending of Ethanol [according to website of Dept. of Food & Public Distribution, Min. of Consumer Affairs,
Food & Public Distribution]
 Streamline of entire ethanol supply chain
 remunerative price of ethanol.
 National Policy on Biofuels, 2018:
→ conversion of surplus food grains to ethanol.
→ 20% ethanol-blending (20% blending of ethanol in petrol by 2030)
→ 5% biodiesel-blending (5% blending of biodiesel in diesel by 2030)
→ expand scope of feedstock for ethanol production
→ production of advanced biofuels.
→ Carbon-heavy molasses-based ethanol
Mains Link:
 Write a note on the 2013 EBP programme.
 Discuss the importance of biofuels for India? Critically examine whether the national policy on biofuels will help
India unlock its biofuel potential?
 Discuss the need for Ethanol Blending Programme, highlighting how the measures could help address the related
issues in India.

DEFENCE / DEFENSE
News:
 2020:
→ SIPRI releases Global Arms report.
→ Defence Ministry notifies 1 st Negative Indigenisation List comprising 101 items.
→ Ministry of Home Affairs declares entire Nagaland as “disturbed area” for 6 more months under Armed Forces
(Special Powers) Act, 1958.
→ Foreign Minister of Nepal says 1947 agreement among India, Nepal, UK that deals with military service of
Gorkha soldiers has become redundant. Nepal plans to terminate 1947 agreement (Gorkha veterans allege
that UK has been discriminating against them).
→ Objection from Nepal regarding Gorkhas serving in Indian military [more prominently in backdrop of Nepal -
India territorial dispute over Kalapani region].
 2021:
→ Defence Ministry notifies 2nd negative import list comprising 108 items.
→ Government brings in few changes in its negative imports list policy. This includes:
 Armed forces will now be able to import defence equipment in certain circumstances even if it figures in negative
import list. Example - scenarios where there is “immediate requirement” that domestic industry cannot provide,
or if safety of soldiers is at stake due to inadequacies in indigenous product.
 Provision to review or remove items mentioned in negative import list.
→ Union Cabinet approves enhanced delegation of financial powers for capital procurement to senior officers
below rank of Vice-Chief of armed forces.
→ Defence minister launches Defence India Start-up Challenge (DSIC) under Innovations for Defence
Excellence - Defence Innovation Organization (iDEX-DIO).
→ Chief of Defence Staff (CDS) General Bipin Rawat, his wife, one Army Brigadier, 10 others killed when Indian Air Force
helicopter carrying them crashed into heavily wooded area of Coonoor ghat, Nilgiris, western Tamil Nadu.
→ Ministry of Home Affairs declares entire Nagaland as “disturbed area” for 6 more months under Armed Forces
(Special Powers) Ac, 1958. [MHA said whole of Nagaland area is in “disturbed and dangerous condition” that use of
armed forces in aid of civil power is necessary].
→ 21st Para Special Forces kills some civilians near village of Oting in Nagaland, India. [Oting incident / killings
is widely condemned with many calling to repeal and revoke Armed Forces Special Powers Act.]
 Centre’s respond:
• Court of enquiry will initiate disciplinary proceedings against Army unit and Army personnel, directly
involved in Oting incident. Identified persons who will face enquiry will be placed under suspension with
immediate effect.
• Nagaland State government would provide jobs to next of kin of deceased.
• Government jobs will be given on compassionate grounds on basis of eligibility.
Page 436 of 719
 → Following recent killings of civilians in Nagaland (2021 Oting incident), Nagaland Chief Minister demands
repeal of Armed Forces (Special Powers) Act, 1958. He criticised Union Government for extending
“disturbed area” tag for Nagaland every year. He also reminded Centre of criticism India earned globally
for this Act.
→ Nagaland will continue to be ‘disturbed area’ for another 6 months under AFSPA because condition of
Nagaland remained “dangerous”.
 2022:
→ Repeal of AFSPA, 1958 is major poll issue in Naga areas of Manipur and focus of political rallies being held
in Manipur State.
→ Members of Ahir community (who’s bravery in 1962 Battle of Rezang La is widely known) is demanding
Ahir Regiment in Indian Army.
→ AFSPA fully or partially withdrawn from parts of NE States — Assam, Nagaland, Manipur. [Currently, AFSPA
remains in force in parts of these 3 States (Assam, Nagaland, Manipur, Arunachal, JK].
→ Military of Defence finalises one radical proposal for future recruitment to Indian armed forces – ‘Tour of
Duty’ model.
→ In renewed push for self-reliance in defence sector, government approves many indigenous defence
projects under Defence Acquisition Procedure, 2020 / DAP, 2020 .
→ Ministry of Defence releases 3 rd positive indigenisation list of 101 items, comprising major equipment /
platforms.
→ Defence Acquisition Procedure 2020 amended to promote ‘Make in India’ & ‘Aatmanirbharta’ in defence.
→ Prime Minister Narendra Modi says efforts were on to improve law -and-order situation for controversial
Armed Forces (Special Powers) Act, 1958 to be completely lifted from NE. He said AFSPA could be
withdrawn partially from Assam, Manipur, Nagaland due to peaceful conditions since 2014.
→ Centre is reassessing concept of CDS and Department of Military Affairs (DMA) to fix overlaps in syste m
and streamline process due to which there has been delay in appointment of new CDS.
 Background: In 2019, Centre approved creation of post of CDS and DMA was created as 5 th department in
Ministry of Defence (MoD) with CDS functioning as its Secretary.
 Issue: Till now there are legacy issues of work distribution between DMA and Department of Defence (DoD),
headed by Defence Secretary. Coordination mechanisms are not standardised and accepted by both sides. There
are overlaps of roles and responsibilities.
→ GOI unveils its new Agnipath scheme for recruiting soldiers across 3 services.
→ India’s export of arms and defence technologies touched record Rs 13,000 crore in financial year 2021-22, with 70%
contribution coming from private sector. Export is mainly to US, Philippines (Brahmos), other SE Asian counties, west-
Asia, Africa.
→ PM unveils ‘SPRINT challenges’.
→ Reduced Defence Import: Expenditure on defence procurement from foreign sources has reduced from 46% to 36%,
thereby reducing import burden, in last 3 years i.e. from 2018-19 to 2020-21.
→ Min. of Defence announces setting up of joint theatre commands of tri-services to enhance coordination among
armed forces. India will have 4 Integrated Theatres: Western Theatre Command; Northern Theatre Command; SW
Theatre Command; SE Theatre Command.
→ Indian Army tests operational readiness of its satellite-based systems under Operation ‘Skylight’.
 Background: ‘Satellite-based Systems’ provide communication facilities to military’s ground and air-based
systems. It also acts as backup in case terrestrial connectivity is disrupted. Mechanism – ground station transmits
to satellite which amplifies and sends back to another ground station. Need: Currently, Army doesn’t have
dedicated satellite system (unlike Air-force, Navy). GSAT-7B satellite will be launched for use by Army. [GSAT-7
series of satellite is meant for defence services].
→ Defence Minister Rajnath Singh unveils 2nd edition of ‘Mehar Baba’ swarm drone competition by Indian Air Force for
Indian start-ups to develop swarm drone based system to detect foreign objects on aircraft operating surfaces.
→ India’s defence exports jumps 334% in last 5 years and supplies to 75 countries: Indian defence ecosystem is
spreading its arms overseas as military exports have jumped by 334% in last 5 years, which involves supplies of
arsenals to more than 75 countries around globe.
→ GOI appoints former Eastern Army Commander Lt. General Anil Chauhan as next Chief of Defence Staff (CDS).
→ MHA extends AFSPA in parts of Arunachal, and Nagaland for another 6 months.
→ According to one study released in 2022 by SIPRI, India ranks 4 th among 12 Indo-Pacific nations in self-reliant arms
production capabilities. China tops list, Japan is 2nd, South Korea is in 3rd place, and Pakistan is at number 8.
→ DM Shri Rajnath Singh launches ‘Maa Bharati Ke Sapoot’ website (www.maabharatikesapoot.mod.gov.in) for online
contribution to the Armed Forces Battle Casualties Welfare Fund (AFBCWF).
→ At DefExpo 2022 (12th edition of DefExpo), Defence Minister Rajnath Singh says India has undertaken a
transformative journey from being the largest defence importer to an exporter.
About:
 Indian Armed Forces / Armed Forces of India:

Page 437 of 719

 → What:
 Military forces of Republic of India.
→ Constituent:
 Indian Armed Forces consist of 3 professional uniformed services: Indian Army, Indian Navy, Indian Air Force.
→ Indian Armed Forces are supported by:
 Central Armed Police Forces (CAPF) / Armed Police Forces; Assam Rifles; Indian Coast Guard (ICG); Special
Frontier Force (SFF); inter-service commands and institutions [Strategic Forces Command (SFC) / Strategic
Nuclear Command, Andaman and Nicobar Command (ANC), Integrated Defence Staff].
→ Command:
 President of India - Supreme Commander of Indian Armed Forces. They are under Ministry of Defence (MoD),
Government of India.
→ Significance:
 Strength of about 1.4 million active personnel. world's 2nd-largest military force. it has world's largest volunteer
army. has 3rd-largest defence budget in world. Global Firepower report lists it as 4th most-powerful military in
world.
 Chief of Defence Staff of Indian Armed Forces (CDS) [2019]:
→ What:
 single-point military adviser to government. recommended by Kargil Review Committee, 1999. 4-star General.
permanent Chairman of Chiefs of Staff Committee (CSC), which will also have 3 service chiefs as members.
→ Aim:
 to bring greater operational synergy between 3 services of Indian military. to keep inter-service frictions to
minimum.
→ Appointment:
 Appointments Committee of Cabinet (ACC).
→ Reports to:
 Minister of Defence.
→ Tenure:
 3 years or 65 years, whichever is earlier.
→ Conditions:
 Not eligible to hold any Government office after resignation. No private employment without prior approval for
5 years after resignation.
→ Member of:
 Chiefs of Staff Committee (Permanent Chairman); National Security Council; Defence Acquisition Council;
Defence Planning Committee; Nuclear Command Authority (advisory function).
→ Roles and functions:
 single-point military advice to government; Permanent Chairman Chiefs of Staff Committee; inject synergy in
planning, procurements, logistics in armed forces; integration of land-air-sea operations; military advisor to PM-
led Nuclear Command Authority; Principal Military Adviser to Defence Minister; member of Defence Acquisition
Council and Defence Planning Committee. function as Secretary to GOI (Department of Military Affairs); head of
Department of Military Affairs in Ministry of Defense; CDS is also vested with authority to provide directives to
3 chiefs; CDS enjoys rank of Secretary within DoD (Department of Defense).
 Indian Army:
→ Infantry regiments:
 Gorkha Rifles:
• History:
 Following 1814-16 Anglo-Nepalese War, British decided to recruit Gorkha soldiers.
 In 1947, after India’s Independence, Tripartite Agreement between India, Nepal and UK was signed.
o Aim: to determine allottment of Gurkha regiments, upon formalisation of India's Independence.
o Feature: Of pre-war Gurkha regiments, some would be transferred to British Army (UK) and some
would become part of newly independent Indian Army. Assured that Gorkha soldiers of Nepal
while serving in british military will draw perks and privileges equivalent to their counterparts.
 …
→ Services:
 Territorial Army [1949] / Terriers:
• What:
 In 1949, India’s 1st Governor General Shri C. Rajagopalachari formally inaugurated Indian Territorial
Army. organization where volunteers apply for short period of training every year, so as to be ready to
tackle any emergent situation or to serve for defence of India. 2nd line of national defence after regular
Army. under Defence Ministry.
• Eligibility:

Page 438 of 719

  Any male Indian citizen between ages of 18 and 42 [written test, interview, medical examination,
necessary training].
• Roles &responsibilities:
 Territorial Army is part of Regular Army. Its present role is to relieve Regular Army from static duties.
assist civil administration in dealing with natural calamities. maintenance of essential services in
situations where communities are affected or security of India is threatened. provide units for Regulars
Army as and when required.
 .…
→ Gorkhas in British Army:
 Currently, Gorkhas comprise about 3% of British Army. Gorkhas completed 200 years of service in British Army.
Gorkhas are held in high esteem in British Army. Gorkhas are regarded as fierce and loyal. Gorkhas are enlisted
not only in infantry, but also in engineering corps and as logisticians. Gorkhas signature weapon (khukri) forms
part of Gorkha regimental insignia in Britain, India. Queen Elizabeth II of Britain is guarded by 2 personal Gurkha
officers.
 Negative Import List For Defence / Negative List For Defence Import / Indigenisation list [2020]:
→ What:
 Negative imports list policy / positive indigenisation list. means that Armed Forces — Army, Navy, Air Force —
will only procure items from domestic manufacturers [private sector players, Defence PSU (DPSU)].
→ Need:
 As per Stockholm International Peace Research Institute (SIPRI), India has been 2nd largest importer between
2014 and 2019. Government wants to reduce dependence on imported items in defence. Govt. wants domestic
defence manufacturing industry as alternative.
→ Significance:
 Domestic industry will get opportunity to step up and manufacture needs of Armed forces. Recognises potential
of local defence industry. Boost to domestic Research and & Development by attracting fresh investment into
technology, manufacturing capabilities. Excellent opportunity for ‘start-ups’, MSME.
→ 2nd Indigenisation List / 2021 Indigenisation list:
 It includes complex systems, sensors, simulator, weapons and ammunitions like helicopters, next generation
corvettes, Air Borne Early Warning and Control (AEW&C) systems, tank engines.
→ 3rd Indigenisation List / 2022 Indigenisation list:
 It includes Hghly complex Systems, Sensors, Weapons and Ammunitions like Light Weight Tanks, Mounted Arty
Gun Systems, Next Generation Offshore Patrol Vessels (NGOPV) etc.
 Integrated Theatre Command:
→ What:
 unified command of 3 Services – Airforce, Army, Navi - under single command, for geographical areas
that are of strategic, security concern. based on recommendations after Kargil War, 1999 - Kargil Review
Committee, 1999 etc. India has 1 Tri-Service Command (Andaman and Nicobar Command). Integrated
or joint theatre command envisages one unified command of 3 Services, under one single commander,
for geographical theatres (areas) that are of strategic and security concern.
→ Aim:
 to have assets of all 3 forces under one commander responsible for all operations under his theatre.
→ Characteristic:
 Commander of Integrated Theatre Command will have all resources at his disposal — from Army, Indian
Air Force, Navy. not answerable to individual Services.
→ Proposals:
 Need for unified approach to war fighting was discussed after 1999 Kargil battle.
• Naresh Chandra Committee:
 It called for structural changes in higher defence management.
• Shekatkar committee, 2015 (combat capability and rebalance defence expenditure of armed forces):
 recommends creation of 3 integrated theatre commands: northern for China border; western for
Pakistan border; southern for maritime role.
 recommended creation of post of CDS.
→ Significance:
 better planning and military response. unified approach to fighting future war. will avoid duplication of
resources. will have all resources of Army, Air Force, Navy. bring down cost in long term. Services will
get to know one another better, strengthening coh esion in defence establishment.
→ Global:
 Many nations have theatre commands - United States, China etc.
 Arms Imports and Exports (India):
→ India continues to remain 2nd largest arms importer, after Saudi Arabia. Arms suppliers to India (descending order):
Russia, France, Israel, USA.

Page 439 of 719

 → India exported worth over Rs. 13,000 cr in 2021-22 (private sector contribution - 70%).
→ India targets to achieve turnover of USD 25 bn in defence production with USD 5 bn of exports by 2025.
→ India is now exporting its defence products to over 75 countries.
→ India signed agreement with Philippines for supply of anti-ship variant of BrahMos Supersonic cruise missile.
→ GOI set ambitious target to achieve a manufacturing turnover of USD 25 billion, or Rs. 1.75 lakh crore, including
exports of USD 5 bn in aerospace and defence goods and services by 2025.
→ India’s defence exports touched Rs. 13,000 crores for 2021-22. For FY2022-23, they have reached Rs. 8,000 crores.
 Military Expenditure:
→ According to SIPRI:
 Total global military expenditure increased by 0.7% in real terms in 2021, to reach USD 2113 billion. 5 largest
spenders in 2021 were - USA, China, India, UK, Russia, and together accounted for 62% of expenditure. USA and
China alone accounted for 52%. India’s military spending of USD 76.6 billion ranked 3rd highest in world. This
was up by 0.9% from 2020.
→ According to one study released in 2022 by SIPRI, India ranks 4 th among 12 Indo-Pacific nations in self-reliant arms
production capabilities. China tops list, Japan is 2nd, South Korea is in 3rd place, and Pakistan is at number 8.
→ According to SIPRI, in Indo-pacific region, in 2021, India is ranked 4 th in exporter, 1 st in importer; and India’s
largest supplier is Russia; and India is ranked 2 nd in spending (about 76 Billion USD) after China (293 billion
USD).
 Issues:
→ Import dependence: Example, INS Vikrant has 3 components - FLOAT (90% indigenization achieved), MOVE
(60%), FIGHT (only 30%).
→ Cost and time overruns: E.g. INS Vikrant was to be inducted by 2017 but inducted in 2022. INS Vikramaditya
was inducted into service more than 10 years after it was purchased.
→ Old technology: Currently, Navy employs 15 conventional sub marines, each of which requires breaking
surfaces to charge its batteries (it doesn’t have air-independent propulsion system).
→ Parliamentary Standing Committee on Defence (SCOD) and other experts have cited need for 3 rd Aircraft
carrier for India.
 Initiative:
→ Defence Acquisition Council (DAC) [2001]. 2011 Defence Production Policy of Min. of Defence. Defence Acquisition
Procedure, 2020 / DAP, 2020. In 2021, Union Cabinet approved enhanced delegation of financial powers for
capital procurement to senior officers below rank of Vice-Chief of armed forces.
→ Indigenization of Defence:
 DAP 2020: Prioritized capital investment from domestic manufacturers; New FDI Policy: Preference to ‘Buy
(Indian)’, ‘Buy & Make (Indian)’ & ‘Make’ categories of acquisition over ‘Buy (Global)’. FDI through automatic
approval is increased from 49% to 74%; E- Biz Portal: One-stop shop for providing G2B services to investors and
business communities; Mission Raksha Gyanshakti: It has objective of creating greater Intellectual Property in
Defence Production Ecosystem; AI in Defence: Creation of Defence Artificial Intelligence Project Agency (DAIPA)
in, 2019 for greater thrust on AI in Defence; Strategic Partnership Policy: This is to promote Joint Ventures (JV)
between global defence majors and indigenous private sector; SPRINT challenges [2022].
→ Development cum Production Partner Initiative, by DRDO, ensures involvement of industries from
beginning of development cycle and leads to reduction in time frame of development -to-induction cycle.
→ Defence India Startup Challenges, under iDEX.
→ Srijan Defence portal to monitor status of progress of indigenization.
→ FDI limit increased to 74%.
→ Innovations for Defence Excellence (iDEX).
→ Positive Indigenisation List under Defence Procurement Policy 2020).
→ Defence Industrial Corridors established in UP, TN.
→ Mission Raksha Gyan Shakti will boost Intellectual Property culture in defence.
 Way Forward:
→ India should look to invest in longer-term indigenization plan and making of critical subsystem on its own.
It should look to enhance Underwater Domain Awareness (UDA) by use of AI / Machine Learning, and
include more private sector for design, production and maintenance.
Note:
 Armed Forces Battle Casualties Welfare Fund (AFBCWF):
→ It is a Tri-Service fund, which is utilised for grant of immediate financial assistance to the families of
soldiers / sailors / airmen who lay down their lives or get grievously injured in active military operations.
It is maintained by Min. of Defence.
 Armed Forces (Special Powers) Act, 1958 / AFSPA, 1958:
→ What:
 This Act (AFSPA) gives armed forces power to maintain public order in “disturbed areas”.
→ Armed forces:

Page 440 of 719

  In context of AFSPA, armed forces mean military forces and air forces operating as land forces, and includes any
other armed forces of Union so operating
→ Disturbed area:
 Disturbed area is declared under AFSPA, 1958. It is area declared by Central Government or Governor or UT
administrator under AFSPA. Ground: Differences or disputes between members of different religious, racial,
language, regional groups, castes or communities. whole or part of State / UT can be declared as disturbed area.
→ Special powers:
 Armed forces can prohibit gathering of 5 or more persons. Armed forces can use force or even open fire after
giving due warning if they feel person is breaking law. On reasonable suspicion, Armed forces can arrest person
without warrant, enter or search premises without warrant, ban possession of firearms. But, person arrested or
taken into custody should be handed over to police station.
→ Issue:
 AFSPA is controverisal law that gives armed forces licence to kill. When armed forces carry out such shameful
operations without keeping local police in loop, as has been in practice for long, it gives message that Centre
just does not care about peace process. Misuse: Govt. commonly imposes AFSPA on pretext of requirement of
armed forces aid to civil power.
→ Judiciary:
 1997 Supreme Court Naga People’s Movement for Human Rights judment:
• Supreme Courtheld that special powers under AFSPA to use deadly force should be employed only under
“certain circumstances”. Supreme Courtheld that power to cause death is relatable to maintenance of public
order in disturbed area and also is to be exercised under definite circumstances. Preconditions include
declaration by high-level authority that said area is “disturbed”. Officer concerned can use deadly force only
when it is “necessary” to maintain public order and only after giving “due warning” 1 st. Persons against
whom action was taken by armed forces should have been acting in violation of law or order in force in that
disturbed area.
→ Review:
 2004 Justice Jeevan Reddy committee [appointed by Centre]:
• AFSPA should be repealed and appropriate provisions should be inserted in Unlawful Activities (Prevention)
Act, 1967. UAPA should clearly specify powers of armed forces, paramilitary forces. Grievance redressal
units should be set up in each district where armed forces are deployed.
 2ndAdministrative Reforms Commission (ARC) on public order recommended repeal of AFSPA. Former home
minister P. Chidambaram said that AFSPA, if not repealed, should at least be amended. Former home secretary
Gopal Krishna Pillai too supported repeal of AFSPA.
→ Areas AFSPA in force currently: Assam; Nagaland; Manipur; Tirap, Changlang, Longding districts of
Arunachal Pradesh; areas falling within jurisdiction of 8 police stations of States bordering Assam.
→ AFSPA in NE India:
 Why was AFSPA imposed on NE in 1st place?
• To supress Naga nationalist movements: When Naga nationalist movement kicked off in 1950s with setting
up of Naga National Council (NNC) —predecessor of NSCN — Assam police forces allegedly used force to
end movement. As armed movement took root in Nagaland, AFSPA was passed in Parliament, and
subsequently imposed on entire Nagaland State.
• Manipur: In Manipur, too, it was imposed in 1958 in 3 Naga-dominated districts of Senapati, Tamenglong,
Ukhrul, where NNC was active.
• As secessionist and nationalist movements started sprouting in other NE States, AFSPA started being
extended and imposed.
 In 2022, AFSPA was withdrawn from parts of NE India - Assam, Nagaland, Manipur.
• Why this decision to withdraw AFSPA from parts of NE India is significant?
 Rreduction of alienation: NE has lived under shadow of AFSPA for nearly 60 years, and thereby creating
feeling of alienation from rest of India. Demilitarisatin of NE region: This move is expected to help
demilitarise NE region; it will lift restrictions of movements through check points and frisking of
residents. Calm resentment due to 2021 Oting killing in Nagaland.
• Why was AFSPA withdrawn in 2022, after being in force for many years?
 Reduction in insurgencies: Over last 2 decades, various parts of NE have seen reduction in insurgencies,
some of them up to 60 years old. In Nagaland, all major groups — NSCN(IM), Naga National Political
Groups (NNPGs) — are at advanced stages of concluding agreements with government. In Manipur,
insurgency as well as heavy militarisation have been on decline since 2012, when Supreme Court
started hearing PIL on extra-judicial killings.
 Fast-track development: NE region has seen increased investment in core infrastructure and
community related projects and need was felt for people to own and cooperate with authorities in
developmental activities.
→ What made AFSPA unpopular among people?

Page 441 of 719

  Human rights violations by Army:
• In Nagaland, 60 years of living under AFSPA regime has had psychological consequences, trauma and
alienation of people. Use of force and AFSPA furthered feeling of alienation of Naga people, solidifying Naga
nationalism.
 Issue of Fake encounters:
• In one writ petition filed in Supreme Court in 2012, families of victims of extra-judicial killings alleged 1,528
fake encounters had taken place in Nagaland State from 1979 to 2012. Supreme Court set up commission
to scrutinise 6 of these cases, and that commission found all 6 to be fake encounters.
 Poor checks and balances:
• While AFSPA gives powers to security forces to open fire, this cannot be done without prior warning given
to suspect. It says armed forces must act in cooperation with district administration and not as independent
body. However, such procedure has rarely been followed.
 Poor investigation:
• Cases in Nagaland have not been investigated. In Manipur, with Supreme Court taken up extra-judicial
killings, CBI investigated 39 cases (94 killings) only.
→ Stands of State governments on AFSPA law.
 While this Act gives powers to central government to unilaterally take decision to impose AFSPA, this is usually
done informally in consonance with State government. However, there have been instances where Centre
overruled State govt., such as imposition of AFSPA in Tripura in 1972. 2021 resolution of Nagaland State
Assembly to repeal AFSPA: Fight to repeal AFSPA has largely been driven by civil society groups. Until 2021 Oting
firing (Nagaland), no State government had openly demanded repeal of AFSPA from their States. After 2021
Oting, Nagaland Assembly passed resolution for 1st time for repeal of AFSPA.
 Defence Acquisition Council (DAC) [2001]:
→ What:
 Integrated council to counter corruption and speed up decision-making in military procurement. Set up by GOI.
headed by Defence Minister.
→ Objective:
 ensure expeditious procurement of approved requirements of Indian Armed Forces, in terms of capabilities
sought, and time frame prescribed, by optimally utilizing allocated budgetary resources.
→ Functions:
 give policy guidelines to acquisitions, based on long-term procurement plans. clears all acquisitions, which
includes both imported and indigenously produced or produced under foreign license.
 Defence Acquisition Procedure, 2020 / DAP, 2020:
→ What:
 Latest India’s policy on defence acquisition. It superseded Defence Procurement Procedure, 2016 / DPP, 2016.
DAP contains policies and procedures for procurement and acquisition from capital budget of MoD in order to
modernise Armed Forces including Coast Guard.
→ Highlights:
 In 2022, this Defence Acquisition Procedure 2020 was amended to promote ‘Make in India’ & ‘Aatmanirbharta’
in defence. Some points are: Going forward all modernisation requirements of Defence Services and Indian Coast
Guard are to be indigenously sourced irrespective of nature of procurement; Import of defence equipment /
sourcing from Foreign Industry of capital acquisitions should only be exception and undertaken with specific
approval of DAC / Raksha Mantri; Requirement of Integrity Pact Bank Guarantee (IPBG) is dispensed with.
Instead, Earnest Money Deposit (EMD) will be taken as bid security for all acquisition cases with Acceptance of
Necessity (AoN) cost more than Rs. 100 crore.
 Financial powers up to Rs. 100 crore is delegated to Army Commanders and equivalent of other services and
regional Commanders, Coast Guard. Powers up to Rs. 200 crore is delegated to Deputy Chief of Army Staff (CD
&S), Master General Sustenance, Chief of Material, Air Officer Maintenance, Deputy Chief, Integrated Defence
Staff and additional director general of Coast Guard.
 Reservations for Indigenous firms: DAP 2020 reserves many procurement categories for indigenous firms; DAP
2020 defines “Indian vendor” as company owned and controlled by resident Indian citizens, with FDI not more
than 4%.
 New Buy (Global–Manufacture in India) category: This stipulates indigenisation of at least 50% of overall contract
value of foreign purchase bought with intention of subsequently building it in India with technology transfer.
 Greater indigenous content: It promotes greater indigenous content in arms and equipment of military procures,
including equipment manufactured in India under licence; DAP 2020 stipulates higher indigenisation than DPP,
2016.
 Import embargo list: Many items under “Import embargo list” are included in DAP 2020. [embargo is
government order that restricts commerce with specified country or exchange of specific goods].

Page 442 of 719

 
Offset liability: There will be no offset clause in procurement of defence equipment if deal is done through inter-
government agreement (IGA), government-to-government or Ab Initio single vendor. [Offset clause requires
foreign vendor to invest part of that contract value in India].
 Agnipath scheme [2022]:
→ What:
 Also spelled Agneepath Scheme is tour of duty scheme introduced by GOI in 2022, for recruitment of soldiers
below rank of commissioned officers into 3 services of Indian armed forces. Agnipath Scheme will be only route
for recruitment into military. All recruits will be hired only for 4 year period. Personnel recruited under this
system are to be called Agniveers (Fire-Warriors), which will be new military rank. Introduction of this scheme
is criticised for lack of consultation and public debate. Under this new scheme, around 45,000 to 50,000 soldiers
(will be called ‘Agniveers’) will be recruited annually (for short period, and most will leave service in just 4 years.
Of total annual recruits, only 25% will be allowed to continue for another 15 years under permanent commission.
→ Eligibility:
 Aspirants between ages of 17.5 years and 21 years will be eligible to apply. This scheme is only applicable to
personnel below officer ranks.
→ Recruitment:
 Twice in 1 year through rallies. Recruitment will be done on “all India, all class” recruitment to services (from
any caste, region, class or religious background). Currently, recruitment is based on ‘regiment system’ based on
region and caste bases.
→ Training period:
 6 months + deployment for 3 and ½ years.
→ Salary / Benefits:
 Recruits will get starting salary of Rs. 30,000, along with additional benefits which will go up to Rs.
40,000 by end of 4-year service. During this period, 30% of their salary will be set aside under Seva
Nidhi programme, and government will contribute equal amount every month, and it will also get
interest. At end of 4-year period, each soldier will get Rs. 11.71 lakh as lump sum amount, which will
be tax-free. For 25% of soldiers, who are re-selected, initial 4-year period will not be considered for
retirement benefits.
→ Significance:
 It will make armed forces much leaner and younger: For India’s over 13 -lakh strong armed forces,
current average age profile is 32 years. It is envisaged that it will come down by about 4 -5 years by
implementation of this scheme.Reduce defence pension bill: GOI has either allocated or paid more
than Rs. 3.3 lakh crore in defence pension since 2020. As per Army calculations, savings for GOI in this
‘Tour of Duty model’ of recruitment from just 1 sepoy would be around 11.5 cr (army initially proposed
3-year service model). Create “future-ready” soldiers: Youthful armed forces will allow them t o be
easily trained for new technologies and in case war in future. Increased employment opportunities
and higher skilled workforce: Apart from job opportunities in army, recruits because of skills and
experience acquired during 4-year service such soldiers will get employment in various fields. It will
empower, discipline and skill youth with military ethos in civil society and improve battle preparedness
suited to changing dynamics. Central government will likely give preference to Agniveers in regular
employment after their 4 years stint. It will transforming defence services. India’s youth is set to play
crucial role in realising dream of building AatmaNirbhar, Sashakt Bharat. And Agnipath scheme will
take them step closer. It is unique opportunity to fu lfil their dream of joining Armed Forces & serving
Nation.
→ Concerns:
 Present benefits and security of jobs will be lost: Recruits will not get permanent jobs or promised
pension and health benefits even after retirement. Doubt about training: 6 months of s hort training
may not be enough to trust them with same kind of tasks that current troops can be trusted with.
Erosion of loyalty: “All India, all class” recruitment to services may lead to erosion of loyalty that
soldier has for his regiment.
→ Reaction:
 This scheme will bypass many things including long tenures, pension, and other benefits which were there in old
system. Opposition parties in India have criticised and expressed concerns about consequences of this new
scheme. They have asked this scheme to be put on hold and that this scheme be discussed in Parliament. In
2022, violent protests erupted in several States in India where army aspirants angry with this new scheme called
for its rollback and damaged public property. Some trains were set on fire, and movement of some trains were
affected. Some trains were cancelled, some trains were diverted, and some were terminated short of their
destination.
→ Other countries:
 Voluntary tour of duty: In USA, tours are 6-9 or even 12 months’ deployment depending upon needs
of military and branch of service. Mandatory tour of duty (called conscription): Countries that follow
practice of conscription include Israel, Norway, North Korea, Sweden.
Page 443 of 719
 Indian Armed Forces vs Central Armed Police Forces (CAPF):
→ CAPF / Armed Police Forces are not Indian Armed Forces. CAPF are headed by civilian officers from Indian
Police Service (IPS). CAPF are under Ministry of Home Affairs, not Ministry of Defence.
 Stockholm International Peace Research Institute (SIPRI) [1966]:
→ Swedish think tank. independent international institute dedicated to research into conflict, armaments, arms control,
disarmament. established on basis of decision by Swedish Parliament. receives substantial funding from Swedish
Government. It is one widely respected independent resource on global security.
 Innovations for Defence Excellence (IDEX) [2018]:
→ initiative by GOI to contribute towards modernization of Defence Industry. To promote innovation and technology
development in Defence and Aerospace. by engaging Industries - MSMEs, start-ups, individual innovators, R&D
institutes & academia. It will be funded by Defence Innovation Organization (DIO).
 Defence Innovation Organization (DIO):
→ ‘not for profit’ company. registered under Companies Act, 2013. co-founders - Hindustan Aeronautics Limited (HAL),
Bharat Electronics Limited (BEL) – Defence PSU (DPSUs).
 Naval Innovation and Indigenisation Organisation (NIIO) [2020]:
→ 3-tier organisation:
 Naval-Technology Acceleration Council (N-TAC): innovation, indigenization, provide directives; Working
group under N-TAC: Implementation of projects; Technology Development Acceleration Cell (TDAC): disruptive
technology in accelerated time frame.
→ Significance:
 Interaction of academia and industry towards innovation and indigenisation for self-reliance in defence
(Atmanirbhar Bharat).
 Ahir community:
→ Legacy:
 Ahir community primarily live in Ahirwal region in Haryana. Ahir community was brought into national limelight
after story of bravery of Ahir troops of Haryana in 1962 Battle of Rezang La was widely known. Ahirwal region /
Ahir community has traditionally contributed soldiers to Indian Army in large numbers.
→ Demand:
 Ahir community have long argued that Ahirs deserve full-fledged Infantry Regiment named after them, not just
two battalions in Kumaon Regiment and fixed % in other regiments.
→ Army’s response to Ahir demand:
 Indian Army rejected Ahir demand for any new class or caste based regiment. It said that while older regiments
based on castes and regions like Dogra Regiment, Sikh Regiment, Rajput Regiment, Punjab Regiment will
continue, no new demands on lines of Ahir Regiment, Himachal Regiment, Kalinga Regiment, Gujarat Regiment
or any tribal regiment would be entertained.
 ‘Tour of Duty’ [2020]:
→ What:
 recruitment model / scheme to let young individuals voluntarily serve for temporary period of 3 years in
Indian Armed Forces. one radical proposal for future recruitment to Indian armed forces. It is of Min. of
Defence.
→ Feature:
 Indian Army will be 1st to try out this concept. It involves recruiting some soldiers for fixed period of 3 years. It
will be voluntary engagement. It is restricted to jawans, and not to officers because officers already have Short
Service Commission (SSC) route.
→ Significance:
 This scheme is for youths who do not want to make defence services their permanent vocation, but still want to
experience thrill and adventure of military professionalism. This proposal is shift from concept of permanent
service / job in Armed Forces, towards internship / temporary experience for 3 years.
→ Benefits:
 Benefits for government:
• immense financial benefits to organisation due to reduction in pay and gratuity payouts. Cost of 3-year
service per officer, if applicable, will be fraction of cost incurred on Short Service Commission (SSC) officers.
Cost incurred on officer, who leaves after 10 or 14 years, is Rs. 5-6.8 crore, which includes cost of pre-
commission training, pay, allowances, gratuity, leave encashment. Corresponding cost for 3-year service will
be Rs. 80-85 lakh. SSC officers have option to join service permanently, which further increases cost
incurred, including pension bills. For soldiers, who usually serve for 17 years, Army has calculated lifetime
savings of Rs. 11.5 crore per person, as compared to 3-year service.
 Benefits for citizens and country:
• It will help to channelise youth energy into positive utilisation of their potential. Rigorous military training
and habits inculcated will lead to healthy citizenry. Entire nation will benefit from trained, disciplined,

Page 444 of 719

 confident, diligent, committed young men or women who have done 3-year service. Initial survey indicated
that corporate sector will prefer to hire such youths rather than fresh graduates.
→ Need:
 Army’s pay and pension bill is increasing steeply over years, accounting for 60% of its budget allocation.
According to report of 2019 Standing Committee of Defence, deficiency in officer cadre of Indian Army stood at
approximately 14%. Advocates of this scheme also cite resurgence of nationalism and patriotism, and fact that
unemployment in our country is reality.
 Military commands of India:
→ India has 19 military commands:
 17 service-oriented military commands: Army has 7, Air Force has 7, Navy has 3; 1 Tri-Service Command (AN); 1
Strategic Forces Command (SFC) [It looks after India’s nuclear stockpile].
 SPRINT challenges [2022]:
→ “Supporting Pole-Vaulting in R&D through Innovations for Defence Excellence (iDEX), NIIO and Technology
Development Acceleration Cell (TDAC)”. It was unveiled by PM in 2022. It is one initiative aimed at boosting usage of
indigenous technology in Indian Navy. It is on collaborative project under which, Naval Innovation and Indigenisation
Organisation (NIIO) in cooperation with Defence Innovation Organisation (DIO), aims to induct new indigenous
technologies / products into Indian Navy.
Value Addition:
 Nuclear Command Authority (NCA):
→ authority responsible for command, control and operational decisions regarding India's nuclear weapons
programme. directives of NCA are to be operationalised by Strategic Forces Command (SFC). Comprises:
Political Council - headed by PM; Executive Council - headed by National Security Advisor (NSA).
 Theatre of War:
→ portion of the space over which war prevails as has its boundaries protected, and thus possesses a kind of
independence
 Theatre of Operations:
→ sub-area within a theater of war.
 International Army Games:
→ also known as War Olympics. Russian military sports event. Annually. many countries take part in dozens
of competitions.
 Negative list of services [tax]:
→ maintained by taxing authorities.
Mains Link:
 Bring out the various concerns regarding implementation of AFSPA in various parts of India. What reforms have been
suggested in this regard. (15M).
 How will the newly launched Agneepath Scheme help make armed forces leaner and tech-savvy? Bring out the concerns
regarding the scheme. (15M)

CRYOGENICS
News:
 2022:
→ President Murmu inaugurates Integrated Cryogenic Engine Manufacturing Facility at HAL in Bengaluru. ICMF is state-
of-art hi-tech equipment and testing facility for manufacturing cryogenic (CE20) and semi-cryogenic (SE2000) engines
of Indian rockets.
About:
 What:
→ In physics, cryogenics is production and behaviour of materials at very low temperatures.
→ IIR International Congress of Refrigeration (held in Washington DC in 1971) endorsed one universal definition of
“cryogenics” and “cryogenic” by accepting threshold of 120 K (–153°C) to distinguish these terms from conventional
refrigeration.
 Feature:
→ Cryogenicists use Kelvin or Rankine temperature scale, both of which measure from absolute 0, rather than more
usual scales such as Celsius which measures from freezing point of water at sea level or Fahrenheit which measures
from freezing point of particular brine solution at sea level.
 Cryogenic fuel:
→ Fuel that require storage at extremely low temperatures in order to maintain them in liquid state. These fuels are
used in machinery that operates in space (e.g. rockets and satellites) where ordinary fuel cannot be used, due to very
low temperatures often encountered in space, and absence of environment that supports combustion (on Earth,
oxygen is abundant in atmosphere, whereas human-explorable space is vacuum where oxygen is virtually non-
existent). Cryogenic fuels most often constitute liquefied gases such as liquid hydrogen.
 Cryogenic Rocket Engine:
→ What:
Page 445 of 719
  It is one rocket engine that uses cryogenic fuel and oxidizer; that is, both its fuel and oxidizer are gases which
have been liquefied and are stored at very low temperatures. This engine uses technology of Cryogenic fuels.
Cryogenic engine provides more force with each Kg of cryogenic propellant it uses compared to other
propellants, such as solid and liquid propellant rocket engines, and is more efficient. Cryogenic engine makes
use of Liquid Oxygen (LOX) and Liquid Hydrogen (LH2) as propellants which liquefy at -183 deg C and -253 deg C
respectively.
→ Cryogenic fuels / propellant:
 Fuels at extremely low temperatures
 combination of liquid oxygen and liquid hydrogen at extremely low temperatures.
→ Example:
 cryogenic fuels for rockets with liquid hydrogen.
 Liquid oxygen (LOX) is widely used but as oxidizer, not as fuel.
 Rocket engine technology that uses rocket propellants at extremely low temperatures, to produce large amount
of engine thrust.
→ Feature:
 highest energy efficiency.
 Thrust is much higher compared to traditional propellants and thus higher payload advantage.
 No air intake is required in Cryogenic engine.
 Fuel needs to be stored at very low temperature
 Its cost of payload is independent of oxidizer
→ Significance:
 Rocket engines burning cryogenic propellants remain in use today on high performance upper stages and
boosters. USA, Russia, Japan, India, France, and China are only countries that have operational cryogenic rocket
engines.
 Initiative:
→ In 2022, President Murmu (India) inaugurated Integrated Cryogenic Engine Manufacturing Facility at HAL in
Bengaluru.
 India:
→ 6th country to develop cryogenic engine (after USA, France, Russia, Japan, China). India would be able to launch heavy
satellites. Critical for success of GSLV program. Countries are reluctant to transfer cryogenic technology. India need
not depend on other space agencies and as such self-reliance is important for India. ISRO can probe deeper into
space. ISRO can earn extra revenue via its commercial wing - Antrix Corporation. Reduction of cost for satellite launch.
→ It is important for advancement of Space Programme. Lighter weight and cost-effective. Clean technology –
Cryogenic technology uses Hydrogen and oxygen as fuel and releases water as by-product. Edge over other countries
in modern technology.
Note:
 Integrated Cryogenic Engine Manufacturing Facility:
→ ICMF is state-of-art hi-tech equipment and testing facility for manufacturing cryogenic (CE20) and semi-cryogenic
(SE2000) engines of Indian rockets. It is located at HAL in Bengaluru. In 2022, it was inaugurated by President Murmu.
ICMF is dedicated to Rocket Manufacturing and its assembly for ISRO. This facility will boost self-reliance in
manufacturing of high-thrust rocket engines. ICMF is state-of-art hi-tech equipment and testing facility for
manufacturing cryogenic (CE20) and semi-cryogenic (SE2000) engines of Indian rockets.
Mains Link:
 What is cryogenic technology? Why is it important for India and how has India acquired this technology? Examine. 10M

FLOOD
News:
 2020:
→ Assam continues to be on edge because of its flood disaster and this has become annual calamity. Assam sees major
floods every year and every time, lives are lost, millions of people get displaced, villages, crops, infrastructure get
destroyed. In 2020, almost 85% of Kaziranga National Park has submerged.
 2021:
→ GLOF (because of glacial breaking of Nanda Devi glacier) in Tapovan area, Chamoli District (RaunthiGarh valley,
Rishiganga valley), Uttarakhand led to massive Flash Flood in Dhauli Ganga R. and Alaknanda River, damaging houses,
claiming lives with many missing, damaging nearby Rishiganga power project. [It reminds of 2013 Kedarnath
calamity, Uttarakhand].
→ Geological Survey of India (GSI) submits its report on causes of 2021 Chamoli disaster.
→ In response to NGT registering suo motu, Tamil Nadu released report on action / measures taken by TN government
to prevent recurrence of flooding.
 2022:

Page 446 of 719

 → Torrential rainfall and landslides erode roads and railway tracks in Assam. Weather department predicts that
“extremely heavy rains” will continue for days as Assam stays on ‘red alert.’
→ Assamese villagers are adopting climate-proofing or flood-resilient mechanisms to cope with floods better.
→ Bengaluru (India’s tech capital) is under floods and so schools are shut and tech firms have urged employees to work
from home. Power and water supply have been hit in many areas. [Previous such flooding incidents were in Kochi,
Mumbai, Hyderabad, Chennai].
About:
 What:
→ Overflow of water that submerges land that is usually dry. Floods are area of study of discipline hydrology. Floods
are of significant concern in agriculture, civil engineering, public health. Human changes to environment often
increase intensity and frequency of flooding. For example, land use changes (deforestation etc), removal of wetlands,
changes in waterway course or flood controls (levees), larger environmental issues (climate change, sea level rise).
Climate change increases rainfall. Extreme weather events increase severity of flooding. They result in more intense
floods and increased flood risk.
 Urban Flood:
→ What:
 flooding of land or property in built environment, particularly in more densely populated areas, caused by rainfall
overwhelming capacity of drainage systems (storm sewers etc). In recent years, in many Indian cities, urban
floods have become frequent phenomenon.
→ Cause:
 Natural factors:
• Increasing downpour (heavy fall of rain).
• Cyclonic storms, thunderstorms. Storm surges for coastal cities, e.g. Cyclone Amphan in 2020 flooded
streets of Kolkata.
• high tides hindering drainage in coastal cities.
 Anthropogenic factors:
• Concretization.
• Wiping out of wetlands.
• Poor civic management of storm water drainage: CAG report in 2021 pulled up Bengaluru municipality for
this poor management.
• Encroachment and illegal constructions: Large number of wetlands that soaked up rainwater has been
encroached. Example - Bangalore had 262 lakes in 1960s; now only 10 of them hold water.
• Deforestation.
• Unplanned urbanization: In Bengaluru, stormwater drains were not directly connected to its water bodies.
In some places, runoff water was flowing into constructed deviation canals. CAG found that this increased
chances of flash floods.
• Destruction of mangroves: Mumbai lost about 40% of its mangroves between 1995 and 2005.
• Lack of coordination: CAG report in 2021 also noted lack of coordination between Bengaluru municipality
and Bangalore Development Authority on drainage-related matters.
 Administrative factors:
• Lack of flood control measures.
• Multiple authorities in city but owning responsibility by few.
→ Measures:
 Structural Measures:
• Conservation of wetlands in urban areas - lakes, ponds, streams. Construction of differential slope along
sidewalks, roads [to drain excess water into reservoirs]. Strengthening of stormwater drainage system. Pre-
monsoon desilting of all major drains. Every building in urban area must have rainwater harvesting as
integral component of building utility. Concept of “Rain Garden” to be incorporated in planning for public
parks. On-site storm water management for larger colonies. Suitable interventions in drainage system -
traps, trash racks - to reduce solid waste going into storm sewers.
 Non-structural Measures:
• National Hydro-meteorological Network is needed for all urban cities in India. Flood hazard assessments.
Better forecasting of rainfall events; timely dissemination of that information to mass – alerts, real-time
weather updates. Restrict encroachments in natural drainage areas. Clearance of river beds. Proper
implementation of Coastal Regulation Zone rules. Atal Mission for Rejuvenation and Urban Transformation
(AMRUT).
→ Issue:
 Groundwater levels: In Chennai, replenished groundwater table across Chennai city after rains becomes
challenge for several buildings with basements.

Page 447 of 719

  In 2022, Bengaluru (India’s tech capital) was under floods and so schools were shut and tech firms urged
employees to work from home. Power and water supply were hit in many areas. [Previous such flooding
incidents were in Kochi, Mumbai, Hyderabad, Chennai].
→ Way Forward:
 Sponge Cities Mission: Idea of sponge city is to make cities more permeable so as to hold and use water which
falls upon them.
 Stormwater disposal system: Brihanmumbai Storm Water Disposal System project to overhaul Mumbai city’s
old stormwater drainage system was started after 2005 severe flood.
 Water-sensitive urban design (WSUD): In Australia, WSUD is implemented to regard urban stormwater runoff,
and waste water as resource rather than nuisance or liability.
 Bioswales: Bioswales are channels designed to concentrate and convey stormwater runoff while removing debris
and pollution. Bioswales can also be beneficial in recharging groundwater. Landscape features that collect
polluted stormwater runoff, soak it into ground, and filter out pollution.
 Rain Garden: Rain gardens, also called bioretention facilities, are one of variety of practices designed to increase
rain runoff reabsorption by soil.
 There is need to include public open spaces within urban fabric in form of storm management infrastructure,
which could help our cities transform into water-sensitive cities.
 Flash Flood:
→ What:
 rapid flooding of low-lying areas - washes, rivers, dry lakes, depressions.
 It may be caused by: heavy rain associated with thunderstorm, hurricane, tropical storm, meltwater from ice or
snow; collapse of natural ice; collapse of human structure – dam etc.
 Flash floods are distinguished from regular floods by having timescale of < 6 hours between rainfall
and onset of flooding.
→ Disadvantage:
 Hazard
 deposit large quantities of sediments on floodplains
 destructive of vegetation cover.
 Glacial Lake Outburst Flood (GLOF):
→ What:
 outburst of water (flood) from glacial lake (outburst of water [flood] that happens when dam
containing glacial lake fails).
→ Feature:
 Sudden (and sometimes cyclic) release of water
 rapid
 Results in large downstream river discharge
→ Why:
 Part of glacier adjacent to glacial lake breaks and collapses into that glacial lake and thereby increasing
water level and pressure.
 Erosion into that lake
 water pressure of that lake
 avalanche of snow, rock into that lake
 earthquake under ice
→ Impact:
 Glacial water release for days.
 Erosion of sedimentary rocks below
 Wash away of Hydro power projects, dams etc. below
 Landslides
 Wash away of villages below
 Harm to property, humans etc.
 Law:
→ Customary international laws: In accordance with customary international laws, no state must use its territory in
manner that causes harm to another state while using shared natural resource; this amounts to saying that there is
binding obligation on all states not to release water to cause floods in another co-sharer of river water. This obligation
gives rise to other procedural norms that support management of floods, which include notification of planned
measures, exchange of data and information, and also public participation.
→ UN Watercourses Convention (UNWC): Its Article 27 (Prevention and Mitigation of Harmful Conditions) says that
watercourse states shall, individually and, where appropriate, jointly, take all appropriate measures to prevent or
mitigate conditions related to international watercourse that may be harmful to other watercourse states, whether
resulting from natural causes or human conduct, such as flood or ice conditions, water-borne diseases, siltation,
erosion, salt-water intrusion, drought or desertification.
Page 448 of 719
 → In Pulp Mills on River Uruguay (Argentina vs Uruguay) case (2010), International Court of Justice (ICJ) upheld that
conducting transboundary environmental impact assessment (TEIA) of planned measure or projects on shared water
course is part of customary international law. In fact, ICJ noted that acting state must notify affected party of results
of TEIA.
 Brahmaputra and India’s concerns:
→ China is upper riparian state in case of Brahmaputra R., which flows through India, and Bangladesh also. China enjoys
apparent leverage w.r.t. lower riparian India. During monsoon, Brahmaputra flooding has been recurrent feature in
last several decades in Assam. India also faces difficulty in form of construction of dams by China. China’s excessive
water release, as “dam controller”, in violation of customary international law has potential to worsen flooding in
Assam in future.
→ India’s main concern is that there is no comprehensive sub-basin or all basin-level mechanism to deal with water
management of Brahmaputra. Neither India or China are party to UN Convention on Law of Non-Navigational Uses
of International Watercourses (UNWC) [1997] or UNECE’s Convention on Protection and Use of Transboundary
Watercourses and International Lakes [1992] / (Water Convention) [1992]. In absence of any mechanism, India relies
on its MoU with China in 2013 with view to sharing hydrological information during flood season (June to September).
This MoU does not allow India access to urbanisation and deforestation activities on Chinese side of Brahmaputra
river basin.
 India and China:
→ India and China signed one MoU on Brahmaputra River in 2013. This MoU says that China should share hydrological
information during flood season (June to September) with India. This MoU does not allow India access to urbanisation
and deforestation activities on Chinese side of Brahmaputra river basin.
 India and Nepal:
→ Issue:
 Floods are also recurrent problem in Koshi river basin and Gandak river basin that are shared by India and Nepal.
Intensity and magnitude of flooding is rising because of heavy seasonal precipitation as well as glacial retreat
due to global warming and human-induced stressors such as land use and land cover changes in river basin area
of Nepal (Terai) and Bihar.
→ Initiative:
 India-Nepal Agreement on Koshi (1954) is aimed at reducing devastating flooding in Koshi river basin.
→ Way Forward:
 It is important that India and Nepal view Koshi river basin and Gandak river basin as single entity, which will help
in facilitating integrated approach for improved basin and flood risk management.
 Impact:
→ Flood obstructs in achieving poverty alleviation, SDG goals.
 Challenge:
→ In contravention of procedural customary international law obligation, India considers data on transboundary rivers
as classified information, which is one of key challenges in developing cross-border flood warning systems.
→ Issue of flood is compounded by lack of transparency in sharing of hydrological information, and
information relating to activities (such as by one riparian state) that are transboundary in their effect that
affects other riparian states.
→ There has been increase in magnitude, frequency and intensity of floods in many parts of world. As
example, nearly 1/3 rd of Pakistan is experiencing devastation, with spread of diseases and severe shortage
of potable water after intense flooding. In 2022 Assam experienced one of its worst floods in living memory
which affected over 30 districts. In some districts in Assam, Bihar, flooding is recurrent feature, and thus
major impediment in ensuring poverty alleviation and meeting SDGs.
→ Flooding is still considered to be natural phenomenon that cannot be entirely prevented. But it is worsen
by lack of transparency in sharing of hydrological information and also information relating to activities
(such as by one riparian state) that are transboundary in their effect (affecting other riparian states), thus
serving as obstacle in understanding magnitude of flooding.
→ Climate change is driving 2022 extreme heat and flooding.
→ Warming, other factors worsened Pakistan floods.
 Way Forward:
→ India signed MoU with China in 2013 to share hydrological information during flood season (June to September).
With MoU in background, India by becoming party to either UNWC [1997] or Water Convention [1992] could lay
groundwork for one bilateral treaty on Brahmaputra with China.
→ In light of floods in Pakistan and visible effects of climate change, it is important that all riparian states must comply
with all procedural duties in accordance with no harm rule to adjacent states. They must also think of becoming
party to either UNWC or UNECE Water Convention.
→ It is important that India and Nepal view Koshi river basin and Gandak river basin as single entity, which will help in
facilitating integrated approach for improved basin and flood risk management.
Note:
 Glacial Lake:
Page 449 of 719
 → Lake formed by melting of glacier
→ Fresh water source
→ Ex. Vasuki Tal Glacial L., Uttarakhand.
 Assam Floods:
→ Intro:
 Assam is high flood prone region [man-made and natural reasons]. In Assam, floods are recurrent
feature during monsoons.
→ Why:
 Brahmaputra is braided and unstable in most areas of Assam. [due to high sedimentation, steep
slopes].
 River also changes course frequently and it is difficult to contain it within embankments. Pressure of
increasing water takes toll on embankment walls.
 Bank Erosion: Assam faces bank erosion around Brahmaputra R., Barak R., and their tributaries. Bank erosion
also increases width of river.
 Guwahati’s topography: It is shaped like bowl — making it vulnerable to water logging.
 Earthquakes / Landslides: Assam is prone to frequent earthquakes, which causes landslides. Earthquakes and
landslides send in lots of debris in rivers, causing river beds to rise.
 Dams: Key man-made reason of floods in Assam is unregulated releasing of water from dams situated uphill.
 Urbanisation: Unplanned expansion of urban areas leading to encroachments in wetlands, low lying areas, hills,
shrinkage of forest.
→ Impact:
 As Assam’s economy is largely dependent on natural resources, what happens with agriculture, forests
have direct effects on livelihood of people.
 During floods, water becomes contaminated, scarcity of freshwater.
→ Benefit:
 Ecologists point out that flood waters have historically rejuvenated croplands and fertilised soil in
Assam’s alluvial areas.
→ Initiative of Govt.:
 Assam govt. primarily relied on embankments to control floods. But this flood control measure was
introduced in Assam in 1950s when hydrology of most Indian rivers, including Brahmaputra, was poorly
understood. And, in 2020, many of Assam’s embankments were breached by floods.
→ Way Forward:
 Study river and impact of climate change to understand why Assam gets flooded every year.
 Water flow information shared by China with India on Brahmaputra R., for which India pays money,
should also be shared with public [so that it helps people understand Brahmaputra River better and
therefore help people better prepare for floods].
 Forecasts of rain can help in improving preparedness. And, weather reports should be made available
on district level and accessible to public.
→ In 2022, it was in news that Assamese villagers are adopting climate-proofing or flood-resilient mechanisms to cope
with floods better. Some of measures taken by them are:
 Building high platform shelters and houses:
• Serves as immediate relief when floods come every year. Almost all houses are raised above ground to
protect them from frequent small floods.
 Relief training:
• They have also formed village disaster management committee, who provided them rescue and relief
training with help of National Disaster Response Force and State Disaster Response Force.
 Shifting cropping patterns:
• Villages have shifted their cropping patterns by cultivating more Rabi than Kharif crops. They have started
cultivating vegetables such as potato, tomato, eggplant, okra, and peas instead of Kharif paddy.
 Child-friendly spaces:
• Spaces are built on elevated platform, in which children’s studies or other activities don’t get disturbed.
They have raised level of Anganwadi and local schools.
 Accessible drinking water:
• They have raised hand pumps.
 Torrential Rain:
→ Any amount of rain that is considered especially heavy. Proclamation that rains are torrential simply means amount
of rain is abundant, had fast on-set, or lasts for long period of time.
 2021 Tamil Nadu Govt. report on flood in TN:
→ Causes for flooding:
 Encroachments, faulty drainage systems, tampering of natural course of water

Page 450 of 719

  Rapid urbanisation of Chennai leading to massive changes in land use patterns [residential areas comes up in
farmlands].
 Changes in land use patterns done without making required changes for proper drainage system to manage flow
of surplus water from traditional tanks, catchment areas.
 Irrigation tanks choked with waste, slush, debris, and thereby obstructing flow of flood water. This also reduced
water-absorbing and groundwater recharging capacity of marsh.
→ Measures:
 Chennai needs integrated flood management system with proper facilities to drain excess rainwater and desilt
channels to prevent floods.
 Integrated road and street side storm water drainage network, diversion channels, macro storm water drains,
check dams, barrages, anicuts.
Value Addition:
 Pelean eruption:
→ type of volcanic eruption.
→ occurs when viscous magma is involved
→ share some similarities with Vulcanian eruptions.
→ Characteristic:
 presence of glowing avalanche of hot volcanic ash (pyroclastic flow).
 Formation of lava domes.
 Short flows of ash or creation of pumice cones may be observed as well.
Mains Link:
 How unplanned development and disregard for natural water bodies cause frequent urban flooding in Indian cities. What
can we learn from other countries in an attempt to address the Urban flooding in India? (15M)
 The frequency of urban floods due to high-intensity rainfall is increasing over the years. Discussing the reasons for urban
floods, highlight the mechanisms for preparedness to reduce the risk during such events. (UPSC 2016)

OCTOBER, 2022
AIR POLLUTION
News:
 2019:
→ Supreme Court asked Centre and Delhi governments to install smog towers in national capital region (NCR)
to combat air pollution.
 2020:
→ Smog pollution in Delhi
→ Air pollution in Delhi, Indo-Gangetic Plains is complex phenomenon, dependent on many factors.
But, every year in October, Delhi’s air quality starts to dip.
→ Delhi uses Pusa Decomposer.
→ NGT directs Ministry of Environment, Forest and Climate Change (MoEFCC) to modify NCAP which
proposes 20-30% reduction of air pollution by 2024. [timeline n eeds to be reduced, % target needs to be
increased].
 2021:
→ EPCA is dissolved, to make way for CAQM.
→ CAQM is dissolved because of lapse of - Commission for Air Quality Management in National Capital Region and
Adjoining Areas Ordinance 2020, under which it was established.
→ Commission for Air Quality Management in National Capital Region and Adjoining Areas Bill, 2021 introduced in Lok
Sabha.
→ Smog towers installed in Delhi, like in China.
→ To check stubble burning menace during paddy season, Punjab announced incentives to industries for
using stubble (paddy-straw-fired boilers).
→ WHO tightens global air pollution standards [because impact of air pollution on health is much more
serious than earlier expected].
→ CAQM says reduction in area under paddy cultivation in Haryana, Punjab, Uttar Pradesh, and shift away
from paddy varieties that take long to mature, could see reduction in stubble burning this year.
→ Delhi government starts spraying bio-decomposer solution (PUSA) in farmlands to decompose stubble l eft
after harvest. [Delhi government sees bio-decomposer (PUSA) as solution to stubble burning and urges
other States to adopt this method. Delhi government 1 st sprayed it in 2020 and claimed that results were
positive.]
→ Punjab Government proposes to use paddy crop residue as fodder for animals, especially cattle.
→ 1st independent impact assessment of Ujjwala programme, conducted by researchers from World Resources Institute
(WRI) India, is published.

Page 451 of 719

 Finding: It highlights Ujjwala programme’s benefits in terms of saving of lives, reduction in air pollution. It says
about 1.5 lakh lives saved per year, 13% reduction in air pollution deaths. Reduction in Death: Greater
penetration and usage of LPG as cooking fuel is estimated to have prevented at least 1.5 lakh pollution-related
premature deaths in year 2019 alone.Reduction in pollution: It also avoided at least 8 million tonnes of PM2.5
emissions in 2019 (13% reduction in air pollution deaths).
→ IQAir (Swiss group that measures air quality levels based on concentration of PM 2.5) releases 2021 World
Air Quality Report.
 2022:
→ WHO releases 2022 Air Quality Database.
→ With wheat yield down this year (2022), rate of tudi is very high and farmers can earn huge profits by selling it. But
despite that, 3,895 field fires are reported in April 2022 in Punjab.
→ 2022 update of 2017 Lancet Commission on Pollution and Health report highlights impact of increasing pollution on
human health in India. Following this, NHRC issues advisory to Centre and State Governments on preventing,
minimising and mitigating impacts of environmental pollution and degradation on human rights.
→ 2021 World Air Quality Report says New Delhi is most polluted capital in world, in terms of PM 2.5.
→ CAQM issues directions to ban use of coal in industrial, domestic and other miscellaneous applications in entire Delhi-
NCR region.
 Need:
• To bring down GHG emissions in Delhi NCR. Delhi is among world’s most polluted capital cities.
• It will help save 1.7 million tonnes of coal annually.
• It will also help reduce pollutants including PM, NOx, CO2, CO.
→ National Air Quality Resource Framework of India (NARFI) was in news.
→ CAQM releases comprehensive policy to curb air pollution in Delhi-NCR region.
→ With aim to cut pollution caused by stubble burning in Haryana, Delhi region, one new 2nd generation (2G) ethanol
plant is set up / dedicated to nation by PM Modi on World Biofuel Day. It is set up in Panipat, Haryana.
 2nd generation (2G) ethanol plant, Panipat, Haryana:
• It is built by Indian Oil Corporation. It is located close to Panipat refinery. It aims to utilise about 2 lakh
tonnes of rice straw (crop-residue) annually to generate around 3 crore litres of ethanol annually. Benefits:
This biofuel plant will be able to get rid of stubble without burning it. It will empower farmers and provide
additional income generation opportunity.
→ US-based research organisation Health Effects Institute (HEI) publishes one report – “Air Quality and Health in Cities”
which says that Delhi and Kolkata have highest and 2nd-highest levels of pollution globally in terms of PM 2.5.
→ CSE analysis finds limited improvement in cities funded by NCAP: One analysis by environmental think tank - Centre
for Science and Environment – reports barely any difference in trends in PM pollution (PM2.5) between group of
cities under NCAP and those outside its ambit. Only 14 of 43 NCAP cities registered 10% or more reduction in their
PM2.5.
→ GOI organizes Swachh Vayu Diwas on occasion of International Day of Clean Air for Blue Skies: MoEFCC organizes 3rd
International Day of Clean Air for Blue Skies as “Swachh Vayu Diwas” / “Swachh Vayu Neel Gagan” to raise awareness
and facilitate actions to improve air quality under National Clean Air Programme (NCAP).
→ Delhi govt to spray bio-decomposer on fields to curb stubble burning.
→ Delhi government will spray bio-decomposer on fields to prevent stubble burning. [Bio-decomposer will also be
sprayed in Punjab on trial basis].
 Bio-decomposer capsules which will be used will accelerate decomposition from stubble to manure in 15-20
days. It comprises dormant form of decomposing Bacteria and cell mass of Fungal spore, accelerating process of
decomposition under aerobic and anaerobic conditions. These capsules have been developed by ICAR-Indian
Agricultural Research Institute (IARI).
→ As per MoEFCC review, released in 2022, stubble generation in 2022-23 will increase by nearly 1.37 million tonnes
(mt) in States adjoining Delhi-National Capital Region and well over 6 mt may go up in smoke despite numerous
measures planned for stubble management.
→ CAQM says that measures under ‘Stage-1’ of GRAP will be enforced in NCR with immediate effect. [This order came
after Delhi’s AQI deteriorated to be in ‘poor’ category. Other parts of NCR, including Gurgaon, Noida and Greater
Noida, also recorded ‘poor’ air quality].
→ As winter pollution is ready to set in, the Delhi government plans to use more Anti-Smog Guns to shoot the pollution
down. The Delhi government is arming itself up with more anti-smog guns (ASGs) to combat pollution. [ASG was 1st
tested back in 2017. Since then, many have been installed at key locations in Delhi].
About:
 In October, Air Pollution Rise in Delhi, Indo-Gangetic Plains:
→ Why / Factors:
 Withdrawal of monsoons:
• During monsoons, prevalent direction of wind is easterly.
• Once monsoon withdraws, predominant direction of winds changes to north westerly.

Page 452 of 719

 • During summers, too, direction of wind is north westerly and storms carry dust from Rajasthan and
sometimes Pakistan and Afghanistan.
 Dip in Temperatures:
• As temperature dips, inversion height — layer beyond which pollutants cannot disperse into upper
atmosphere – is lowered.
• Then, concentration of pollutants in air increases.
 Wind speed:
• very effective at dispersing pollutants.
• But winters bring dip in wind speed.
 Farm fires:
• Biomass burning in winters – household coal burning, stubble burning etc.
 Dust pollution:
• PM 10, PM2.5.
 Vehicular pollution:
• 2nd biggest cause of pollution in winters.
 SMOG:
→ What:
 mixture of Smoke and Fog.
 It also contains dust, air pollutants - NOx, Volatile Organic Compounds (VOCs) etc.
 coined by Dr. Henry Antoine in 1905, after blanket of smoke and fog was noticed over London.
→ Component:
 Smog combines with sunlight and forms dense layer of harmful ground-level ozone.
 So, it consists of ozone, harmful substances – SOx, NOx, CO, PM10s etc.
→ Types:
 Sulfurous smog:
• London smog
• due to high concentration of SOx in air.
 Photochemical smog:
• sunlight reacts with NOxand VOC(s) in atmosphere.
→ Causes:
 coal-burning
 stubble burning
 automobile exhausts
 power plants
 fireworks
 paint
 hairspray
 plastic popcorn packaging etc.
→ Factors:
 formation of smog is closely linked withlocal weather:
• temperature
• sunshine
• calm winds.
 On warmer day, smog can form more quickly.
→ Impact:
 on health:
• Harmful to health, nose, throat
• like cigarette smoking.
• inflamed lungs
• probable heart attacks, strokes.
• reduces immune system.
• DecreasesUV radiation and may lead to low production of Vitamin D.
 Stubble Burning:
→ What:
 Burning stubble i.e. left over after harvesting rice / paddy / cereal
 common practice followed by farmers to prepare fields for sowing of wheat in November as there is little time
left between harvesting of paddy and sowing of wheat.
 It is a common practice followed by farmers to prepare fields for the sowing of wheat in November as there is
little time left between the harvesting of paddy and the sowing of wheat.
→ Reasons why farmers opt for stubble burning:

Page 453 of 719

  It quickly clears field and is cheapest alternative. Farmers do not have alternatives for utilising stubble
effectively.
 farmers are ill-equipped to deal with waste [because they cannot afford new technology].
 farmers are likely to burn up their fields to decrease costs and not spend on scientific ways of stubble
management.
 Kills weeds, including those resistant to herbicide.
 Kills slugs and other pests.
 reduces nitrogen tie-up.
 Little time between harvesting of paddy and sowing of wheat.
→ Effects:
 Pollution:
• emission of harmful gases – CO2, SO2, NO2, PM, toxic pollutants - CH4, CO, VOC, carcinogenic
polycyclic aromatic hydrocarbons. And, they may eventually cause smog. Ex – NCR region, Gangetic
plains.
• Stubble burning results in the emission of harmful gases such as carbon dioxide, Sulphur dioxide,
and nitrogen dioxide along with particulate matter.
 Soil fertility:
• Burning stubble / husk on ground destroys nutrients in soil, making soil less fertile.
 Heat penetration:
• Heat generated by stubble burning penetrates into soil, leading to loss of moisture and useful
microbes.
→ Advantage:
 quickly clears field and is cheapest alternative.
 Kills weeds, including those resistant to herbicide.
 Kills slugs and other pests.
 reduces nitrogen tie-up.
→ Importance of stopping stubble burning:
 conserving fertility of soil
 saving beneficial micro-organisms.
→ Issue:
 As per MoEFCC review, released in 2022, stubble generation in 2022-23 will increase by nearly 1.37 million
tonnes (mt) in States adjoining Delhi-National Capital Region and well over 6 mt may go up in smoke despite
numerous measures planned for stubble management
→ Initiative:
 Stubble burning is made crime under Air Act, 1981.
 National Policy for Management of Crop Residues [2014].
 Promotion of machines – Rotavator, Happy seeder.
 Use of stubble in cattle feed, bio-ethanol.
 A series of short-term ex-situ and in-situ solutions have been rolled out by GOI and State governments.
In-situ solutions include happy seeders and bio-decomposers, while the ex-situ solutions include
collecting and using stubble as fuel in boilers, to produce ethanol, or simply burning away alongside
coal in thermal power plants.
 Economic incentives to reduce burning have also been tested with limited succe ss.
→ Way Forward:
 Addressing the root cause i.e. substantially reducing the amount of paddy being grown and replacing
it with other crops that are equally high -yielding, in-demand, and agro-ecologically suitable such as
cotton, maize, pulses and oil seeds.
 Building trust with farmers to ensure they are seen as partners (rather than perpetrators) and
providing them with the financial support necessary.
 At a policy level, it also requires recognising that agriculture, nutrition, water, the environment, and
the economy are all deeply intertwined in the era of the Anthropocene.
 Establishing a mechanism for intersectoral policymaking that aligns our goals for sectoral policy within
the broad frame of sustainable development we wish to follow.
 Delhi Government’s “15-point winter action plan”.
 Bio-decomposer, Crop residue management.
 Biomass Power Projects, Co-firing in Thermal Power Plants, Feedstock for 2G Ethanol plants, Feed
stock in Compressed Biogas plant, fuel in industrial boilers, Waste -to-Energy plants, packaging
materials etc. Prohibition of stubble / crop residue burning. Effective monitoring / enforcement.
 In 2021, CAQM said reduction in area under paddy cultivation in Haryana, Punjab and Uttar Pradesh,
and shift away from paddy varieties that take long to mature (crop diversification), could see reduction
in stubble burning.
Page 454 of 719
  Promote paddy straw-based power plants. [It will also create employment].
 Incorporation of crop residues (stubble on land but not burning) in soil can improve soil moisture and
help activate growth of soil microorganisms for better plant growth. It will also decrease soil erosion.
 Natural decay of stubble. Because, crop residues in soil can improve soil moisture and make soil
microorganisms grow for better plant growth.
 Composting:
• residues can be enriched into organic manure via composting.
 New opportunities for industrial use like extraction of yeast protein can be explored through scientific
research.
 Supreme Court:
• Incentives could be provided to those who are not burning stubble and disincentives to those who
burns stubble.
• Beneftis of MSP scheme may be wholly or partly denied to those who continue to burn crop
residue.
 Chhattisgarh Model:
• setting up gauthans.
• also generates employment among rural youth.
• Chhattisgarhgovernment supports transportation of stubble from farm / fields to nearest gauthan.
• Chhattisgarh has successfully developed hundreds of gauthans.
→ Haryana’s efforts in residue crop management:
 With aim to cut pollution caused by stubble burning in Haryana, Delhi region, one new 2nd generation (2G)
ethanol plant is set up / dedicated to nation by PM Modi on World Biofuel Day. It is set up in Panipat, Haryana.
It is built by Indian Oil Corporation. It is located close to Panipat refinery. It aims to utilise about 2 lakh tonnes
of rice straw (crop-residue) annually to generate around 3 crore litres of ethanol annually. Benefits: This biofuel
plant will be able to get rid of stubble without burning it. It will empower farmers and provide additional income
generation opportunity.
 Haryana set up 64.3 MW biomass power projects that consume 2.37 lakh MT of paddy straw, while another 2.41
lakh MT of paddy straw is being used by other industries.
 Villages are being categorized into red, yellow, and green zones in terms of incidences of crop residue burning.
 Haryana is providing subsidy on Crop Residue Management (CRM) machines.
 Use of Happy Seeder Machines.
 Measures to improve air quality:
→ Decrease air pollution emissions.
→ Pass legislation to incentivize use of clean air vehicles for personal, industrial use.
→ Invest in renewable energy sources.
→ Provide financial incentives, such as trade-in programs, to limit use of internal combustion engines.
→ Provide subsidies to encourage use of battery, human -powered transportation methods.
→ Expand public transportation and power with clean and renewable energy sources.
→ Improving public transport
→ Limiting polluting vehicles on road
→ Introducing less polluting fuel
→ Strict emission regulations
→ Improved efficiency for thermal power plants, industries
→ Moving from diesel generators to rooftop solar
→ Increased use of clean renewable energy
→ Electric vehicles
→ Removing dust from roads
→ Regulating construction activities
→ Stopping biomass burning.
→ NGT recommendations:
 NGT suggested shifting to e-vehicles, CNG vehicles, public transport system, mechanical cleaning of roads, public
parking facilities, fuel quality, traffic management.
 NGT directed State Pollution Control Boards to install Ambient Air Quality Monitoring Systems (AAQMS).
 NGT directed Central Pollution Control Board (CPCB) to design model for “Source Apportionment”, “Carrying
Capacity” assessment. [Source Apportionment - practice of deriving information about pollution sources and
amount they contribute to ambient air pollution levels. Carrying Capacity – No. of people that can be permitted
into any area without risk of degrading environment in that area].
 Initiative:
→ India has launched:
 Pradhan Mantri Ujjwala Yojana programme.
 National Clean Air Programme (NCAP).
Page 455 of 719
  Commission for Air Quality Management in National Capital Region [2019].
 Concerns:
→ India’s air pollution control initiatives are not guided by one centralised administrative organisation.
→ Air pollution is now considered to be world’s largest environmental health threat.
→ Air pollution accounts for 7 million deaths around world every year.
→ Air pollution causes and aggravates many diseases – asthma, cancer, lung illnesses, heart disease.
→ Estimated daily economic cost of air pollution is about USD 8 billion i.e., 3 to 4% of gross world product.
 Status:
→ CSE analysis found limited improvement in cities funded by NCAP: One analysis by environmental think tank - Centre
for Science and Environment – reported barely any difference in trends in PM pollution (PM2.5) between group of
cities under NCAP and those outside its ambit. Only 14 of 43 NCAP cities registered 10% or more reduction in their
PM2.5. Cities in Punjab, Rajasthan, Maharashtra dominated list of cities which registered significant increase in
PM2.5 levels between 2019 and 2021.
Note:
 WHO recommends maximum permissible level of 5 micrograms per cubic metre for PM2.5.
 Paddy crop residue:
→ Importance:
 nutritional value (crude protein, total digestible nutrients (TDN), phosphorus, nitrogen)
 potential ruminant production (fodder):
• Challenges:
 Animals cannot be fed paddy straw directly from fields. This is because high silica and lignin content in
paddy straw reduces animals’ digestion.
 Higher selenium content in paddy straw also limits its use as fodder in animals as compared to wheat
straw.
 Paddy also contains small amount of oxalates which leads to calcium deficiency.
• Remedy to said challenges:
 If given in moderate quantities, selenium poses no health hazard to animals.
 To minimise effects of oxalates, mineral mixture should always be fed along with straw.
 urea treatment of paddy straw
 urea plus molasses treatment.
→ Impact if burnt:
 economic loss
 air pollution
 Gauthan:
→ dedicated land plot / area, held in common by each village, where all unu sed stubble is collected through
people’s donations and is converted into organic fertiliser by mixing with cow dung, natural enzymes.
 Environment Pollution (Prevention and Control) Authority (EPCA) [1998]:
→ What:
 Supreme Court mandated body (not statutory)
 notified by Environment Ministry under Environment Protection Act, 1986.
 now dissolved.
→ Aim:
 tackle air pollution in National Capital Region (NCR).
→ Functions:
 protect and improve quality of environment in NCR
 prevent and control environmental pollution in NCR
 enforce GRAP in NCR.
 National Clean Air Programme [2019]:
→ What:
 launched by MoEFCC. 1st-ever effort in India to frame national framework for air quality management
with time-bound reduction target.
→ Objective:
 NCAP seeks to cut concentration of coarse particles (PM10), fine particles (PM2.5) by 20-30% by
2024, with 2017 as base year for comparison.
→ Coverage:
 NCAP includes non-attainment cities identified by Central Pollution Control Board (CPCB) on basis of
their ambient air quality data.
→ Feature:
 Guideline for indoor and pollution, more monitoring stations, air information centres for data analysis, resource
sharing studies and set up national inventory, public participation on planning & implementation, city specific

Page 456 of 719

 plan for 100 polluting cities. Implemented by CPCB in over 132 most polluted cities. Its recommendations are
advisory and not legally binding.
→ Issue:
 For monitoring, CPCB only considers levels of PM10, relatively larger, coarser par ticles. However
PM2.5, smaller, more dangerous particles, aren’t monitored as robustly in all cities, mostly due to lack
of equipment.
→ NGT’s view on NCAP 2019:
 Enforcement of ‘Sustainable Development’ principle and ‘Public Trust Doctrine’ require measures to
achieve mandate of international obligations related to environmental quality, for which Environment
(Protection) Act, 1986 was enacted.
 Right to Clean Air is recognized as part of Right to Life (Article 21) and failure to address air pollution
is denial of Right to Life under Article 21.
 Public Trust Doctrine:
→ sovereign / state, holds trust of people to manage resources for benefit of people.
 NationalAir Quality Index (NAQI):
→ What:
 index to judge air quality.
 developed by CPCB
 has outlined ‘One Number – One Color - One Description’ to make easy for common man.
→ 8 pollutants:
 Particulate Matter (PM10)
 Particulate Matter (PM2.5)
 Nitrogen Dioxide (NO2)
 Sulphur Dioxide (SO2)
 Carbon Monoxide (CO)
 Ozone (O3)
 Ammonia (NH3)
 Lead (Pb)
→ 6 categories:
 Good
 Satisfactory
 Moderate
 Poor
 Very Poor
 Severe
 World Air Quality Report:
→ released by IQAir (Swiss group that measures air quality levels based on concentration of PM 2.5)
→ overview of state of global air quality
→ 2021 World Air Quality Report:
 This report presented overview of state of global air quality in 2021.
 Findings:
• New Delhi - most polluted capital in world, in terms of PM 2.5.
• Bangladesh - most polluted country in world in 2021. [Earlier, in 2018, 2019, 2020 also Bangladesh was
found to be most polluted country].
• No country in world managed to meet WHO’s air quality standard in 2021.
• All over world, 93 cities reported PM 2.5 levels at 10 times WHO recommended level.
• Among cities, New Delhi - most polluted city in world . Dhaka is 2nd.
 India:
• New Delhi continues to be world’s most polluted capital city for 4thconsecutive year.
• In 2021, India was home to 11 of 15 most polluted cities in Central Asia, South Asia.
• 35 Indian cities are under worst air quality tag for 2021. Bhiwadi in Rajasthan topped this list, followed
Ghaziabad, Uttar Pradesh.
 Commission for Air Quality Management (CAQM) [2021]:
→ What:
 statutory authority, permanent body for Air Quality Management in NCR and Adjoining Areas.
 It supersedes central and State pollution control boards of NCR and of areas adjoining of NCR in Haryana, Punjab,
Rajasthan, Uttar Pradesh, that impacts air quality in NCR.
 powers to issue directions to NCR State governments on issues related to air pollution.
→ Origin:
 erstwhile Environment Pollution (Prevention and Control) Authority [EPCA] was dissolved to make way for
CAQM
Page 457 of 719
 CAQM was formed for 1st time in 2020 by ordinance, but then this 2020 CAQM was repealed in 2021 by and
created newly by Commission for Air Quality Management in National Capital Region and Adjoining Areas Act,
2021.
→ Composition:
 Government official of rank Secretary or Chief Secretary – Chairperson (for 3 years or 70 years).
 representatives from several Ministries
 representatives from stakeholder States.
 experts from CPCB, ISRO, Civil Society.
→ Jurisdiction:
 Exclusive jurisdiction over NCR in matters of air pollution
 works along with CPCB, ISRO, respective State governments.
→ Power / Function:
 can issue directions to State governments on air pollution
 can hear complaints for pupose of protecting and improving quality of air in NCR and adjoining areas
 will make guidelines for control of air pollution
 in-charge of identifying violators, monitoring factories and industries, monitoring any polluting unit in NCR
region
 will have powers to shut down polluting units.
 will have powers to overrule NCR State governments directives that may violate pollution norms.
→ Penal powers:
 Yes, it will have some teeth.
 power to impose fine and imprisonment.
→ Criticisms:
 multiplicity of laws and institutions will create more confusion and friction.
 India already has NGT, CPCB, SPCBs, erstwhile EPCA and no one is clear as to what needs to be done.
 lack of law is not problem in India. Problem is with missing political will in implementation of laws.
→ Erstwhile EPCA - not sufficient?
 EPCA was not statutory body.
 EPCA drew legitimacy from Supreme Court.
 EPCA had no State representatives.
→ Way Forward:
 thorough review of various laws and institutions to find their efficacy and utility.
 detailed consultation with all relevant stakeholders - farmers’ groups, small scale industries, public.
 review public comments on bill.
 In 2022, CAQM formulated comprehensive policy to reduce menace of air pollution in Delhi-NCR. This Policy
deals with thermal power plants, clean fuels & electric mobility, public transportation, road traffic management,
diesel generators and bursting of fire crackers. This policy focuses on abating air pollution through greening and
plantation on large scale, among other mitigation measures. This CAQM Policy recommended for - Time-bound
implementation, better monitoring, Dust management, availability of clean fuels and technology, promotion of
Circular economy.
 Commission for Air Quality Management in National Capital Region and Adjoining Areas Act, 2021:
→ What:
 Act to provide for constitution of Commission for Air Quality Management in National Capital Region and
Adjoining Areas for better coordination, research, identification and resolution of problems surrounding air
quality index.
→ Focus:
 NCR surrounding air quality index.
→ Feature:
 It has decriminalised act of stubble burning.
 It will levy environmental compensation fees [on people – farmers etc. – for acts of stubble burning]
→ Applicability:
 NCR
 areas adjoining of NCR in Haryana, Punjab, Rajasthan, Uttar Pradesh, that impacts air quality in NCR.
→ Need:
 Sources of air pollution in NCR consist of factors beyond local limits - power, agriculture, transport, industry,
residential, construction sectors.
 Air pollution is not localised phenomenon. Its effect is also felt in areas far away from source. Thus, regional-
level initiatives (CAQM) through inter-State and inter-city coordination is required.
 Smog Tower:
→ What:

Page 458 of 719

 structure designed to work as large-scale air purifier. They are fitted with multiple layers of air filters and fans
at base to suck air. After polluted air enters smog tower, it is purified by multiple layers before being re-circulated
into atmosphere.
→ History:
 experimented in recent years in cities in Netherlands, China, South Korea, Poland.
 1st smog tower was erected in 2015, in Rotterdam, Netherlands.
→ Working mechanism:
 fitted with multiple layers of filters which trap fine dust particles suspended in air as it passes through them.
 Air is drawn throughfans installed at top of tower, passed through filters, and then released near ground.
→ Benefit:
 clean air zones in city.
 reduces 50% of particulate matter loads — fine dust particles suspended in air
→ Delhi:
 Need of Smog Tower:
• Air pollution
• since 2014, Delhi ranked among most polluted cities (esp. PM 2.5 that can enter organs and cause lasting
damage) in world frequently (by WHO).
• Pollution in Delhi increases dramatically during winter, posing serious risk to vulnerable, healthy
populations.
 Reasons for high pollution in Delhi:
• Construction work (in and around Delhi)
• Industrial pollution (in and around Delhi)
• vehicular pollution (in and around Delhi)
• In winter, worsen by smoke from stubble-burning in NW States, unfavourable meteorological conditions -
calm winds, low temperatures, fewer sunny days.
 Measures:
• Persuading farmers in Punjab, Haryana to use alternatives to stubble-burning.
• Closure of thermal power stations.
• Use of piped natural gas.
• GRAP.
 Anti-Smog gun:
→ What:
 Device that sprays nebulised water droplets into atmosphere to reduce air pollution. Connected to water tank
and mounted on vehicle, it can be taken across city to spray water to settle dust and other suspended particles.
Results are positive as spray acts like rain and settles dust particles, PM 2.5. It is currently, installed at various
places in Delhi.
Anti-smog gun is a device that spews fine nebulised (convert liquid into spray) water droplets into the
atmosphere so that the smallest dust and polluted particles are absorbed. The gun is connected to a water tank
which is mounted on a vehicle. It is designed in such a way that it converts the water into a fine spray with
droplets size of 50-100 microns by passing it through high-pressure propellers.
→ Feature:
 ASGs come with different nozzle and propeller configurations. Coarser nozzles are used at mining and
construction sites. These can be customized for use in urban areas.
→ Mechanism:
 ASG, also called a spray gun, mist gun or water cannon, reduces air pollution by binding dust and other
particulate matter (PM2.5 and PM10) and carrying them down to the ground level along with water.
 ASG makes a canopy effect and works like rain to bring down the suspended particles wafting (moving) in the
atmosphere. The water spray can go up to a height of 150 feet and spew water 30-100 litres per minute.
→ Concern:
 Environmentalists say these ASG devices have their impact only for a limited time. Their effect is also restricted
to a certain area or space when the spray operation is undertaken. It’s a temporary measure for quick relief, not
a long-lasting solution.
 D Saha, a scientist at CPCB said this system can’t be applied in an area like Delhi, and that it can only work in a
confined area like a stadium and not in open areas.
 Every ASG uses 40 to 250 litres of bacteria-free water per minute, and thus some feel it’s a waste when we weigh
its benefits.
→ Significance:
 While containing air pollution in cities, it also helps in controlling industrial dust in mining, grinding, coal, and
stone crushing. Recently, the ASG devices were also used after the demolition of the Noida twin towers.
 By installing ASGs at select locations, dust can be curbed from dispersing into the air.
 WHO Global Air Pollution Standards:
Page 459 of 719
 → It limits annual emission of:
 PM2.5
 PM10
 O3
 NO2
 SO2
 CO
 …
→ As of now, countries follow 2005 WHO Global Air Pollution Standards.
 WHO Air Quality Database:
→ What:
 It compiles data on ground measurements of annual mean concentrations of particulate matter (PM)
and nitrogen dioxide (NO2).
 This database is updated regularly every 2-3 years.
 Data compiled in this database is used as input to derive SDG Indicator, Air quality in cities, for which
WHO is custodial agency.
 5th WHO air quality database – largest of its kind – covers over 6000 cities / human settlements, mostly
cities, in 117 countries, and indicates where air pollution levels and related health risks are higher.
→ 2022 WHO Air Quality Database:
 It shows that almost entire global population (99%) breathes air that exceeds WHO’s air quality limits.
 WHO for 1st time has taken ground measurements of annual mean concentrations of nitrogen dioxide
(NO2).
 It also includes measurements of Particulate Matter (PM) with diameters equal or smaller than 10 μm
(PM10) or 2.5 μm (PM2.5).
 Its findings have prompted WHO to highlight importance of curbing fossil fuel use and taking other
tangible steps to reduce air pollution levels.
 Finding:
• According to this report air quality is poorest in Eastern Mediterranean and SE Asia regions, followed by
Africa.
• Highest concentrations of Nitrogen dioxide (NO2) were found in eastern Mediterranean region.
• In low- and middle- income countries, air quality in less than 1% of cities complies with WHO recommended
thresholds.
 2022 update of 2017 Lancet Commission on Pollution and Health:
→ India specific findings:
 Air pollution was responsible for 16.7 lakh deaths in India in 2019, or 17.8% of all deaths in india in
2019. This is largest number of air-pollution-related deaths of any country.
 9.8 lakh were caused by PM2.5 pollution, and another 6.1 lakh by household air pollution.
 Pollution sources associated with extreme poverty (such as indoor air pollution, water pollution): This
number has reduced but, this reduction is offset by increased deaths attributable to industrial
pollution (such as ambient air pollution, chemical pollution).
 Worst affected places: Air pollution is most severe in Indo-Gangetic Plain. This area contains New Delhi
and many of most polluted cities.
 Causes: Burning of biomass in households was single largest cause of air pollution deaths in India,
followed by coal combustion and crop burning.
 Lead: 27.5 crore children are estimated to have blood lead concentrations.
 Economic losses due to modern forms of pollution have increased as proportion of GDP between 20 00
and 2019 in India. It amounts to 1% of GDP.
→ Global findings:
 Globally, air pollution alone contributes to 66.7 lakh deaths.
 Overall, pollution was responsible for estimated 90 lakh deaths in 2019 (equivalent to 1 in 6 deaths
worldwide).
 More than 80 crore children are estimated to have blood lead concentrations. Factors responsible are
rising ambient air pollution, rising chemical pollution, ageing populations and increased numbers of
people exposed to pollution.
 Global cost of fossil fuel air pollution is estimated to be about USD 8 billion per day.
 Pusa Decomposer:
→ What:
 microbial solution [mixture of 7 fungi that produce enzymesto digest paddy straw ]
 bio-decomposer that converts stubble into manure
 developed by Indian Agricultural Research Institute (IARI), commonly known as PUSA Institute [PUSA
Institute is under ICAR].
Page 460 of 719
 → Feature:
 decomposes crop residue, including paddy straw, and turns it into manure in about 25 days.
→ Significance:
 can be used when paddy is harvested and wheat is sown i.e. practicab le.
 stubble burning solution
 converts stubble into manure and compost
 Improves fertility and productivity of soil
 lesser fertilizer is reqd. in future.
 Efficient, effective, cheaper [successfully decomposes up to 80% of straw in given area]
 eco-friendly
 solution to prevent stubble burning - disposal of stubble without stubble burning.
 CO, CH4, O3, SO2 – are all released into atmosphere due to burning of crop / biomass residue.
 National Air quality Resource Framework of India (NARFI):
→ It will help decision-makers in government and private sectors to address air pollution issues in different climatic
zones of India. It was developed by: National Institute of Advanced Studies (NIAS), Bengaluru with support from office
of Principal Scientific Adviser to GOI.
 “Air Quality and Health in Cities” report:
→ One report which is published by US-based research organisation Health Effects Institute (HEI). Its 2022 report
findings are:
 Delhi has highest PM 2.5 globally and had ‘annual exposure level’ of 110 micrograms per cubic metre
(µg/m³) of PM2.5 (WHO recommendation is should not exceed 5 µg/m3). Kolkata came 2 nd with 84
µg/m³ of PM2.5.
 Shanghai leads list of cities most polluted due to NO2.
 Trend of exposure:
• Exposure to PM2.5 pollution tended to be higher in cities located in low- and middle-income countries.
• NO2: Exposure to NO2 was found to be higher across cities in high-income as well as low- and middle-
income. Reason: NO2 is produced mainly from burning of fuels mostly in older vehicles, power plants,
industrial facilities and residential cooking and heating. As city residents tend to live closer to busy roads
with dense traffic, they are often exposed to higher NO2 pollution than residents of rural areas.
 Impact: In 2019, 7 million deaths linked to PM2.5 exposure occurred.
 WHO Global Air Quality Guidelines:
→ They aim to save millions of lives from air pollution. These guidelines recommend air quality levels for 6 pollutants –
Particulate Matter (PM2.5, PM10), Ozone (O₃), Nitrogen Dioxide (NO₂), Sulfur Dioxide (SO₂), Carbon Monoxide (CO).
 International Day of Clean Air for blue skies [2019]:
→ It is designated by UNGA on 7 September to strengthen international cooperation in improving air quality and
reducing air pollution.
 Graded Response Action Plan (GRAP) [2017]:
→ What:
 GRAP is one set of emergency measures that kick in to prevent further deterioration of air quality once it reaches
certain threshold.
→ Background:
 It is based on one plan that was submitted by CPCB in 2016. GRAP was 1st notified in 2017 by MoEFCC.
→ Feature:
 CAQM relies on air quality and meteorological forecasts by Indian Institute of Tropical Meteorology (IITM) and
IMD.
 Stages:
• Stage 1 of GRAP is activated when AQI is in ‘poor’ category (201 to 300).
• 2nd, 3rd and 4th stages will be activated 3 days ahead of AQI reaching ‘very poor’ category (301 to 400),
‘severe’ category (401 to 450) and ‘severe +’ category (above 450) respectively.
Glossary:
 Non-attainment city:
→ Cities that fell short of National Ambient Air Quality Standards (NAAQS) for over 5 years]
Question:
 In context of WHO Air Quality Guidelines:
→ 24-hour mean of PM2.5 should not exceed 15 ug/m3 and annual mean of PM2.5 should not exceed 5 ug/m3.
→ Excessive ozone in air can trigger asthma.
As per new guidelines recommended air quality levels by WHO (revised after 16 years), 24-hour mean of PM2.5 should
not exceed 15 ug/m3 and annual mean of PM2.5 should not exceed 5 ug/m3. Highest levels of ozone pollution occur
during periods of sunny weather and not during unpleasant weather. PM 2.5 can penetrate lung barrier and PM 10 can
only lodge inside lungs. Excessive ozone in air can cause breathing problems, trigger asthma, reduce lung function and
cause lung diseases.

Page 461 of 719

  Factors responsible for exposure to benzene pollution are - Automobile exhaust, Tobacco smoke, Wood burning, using
varnished wooden furniture, using products made of polyurethane, etc.
Mains Link:
 What is a graded response action plan (GRAP)? Discuss the effectiveness of such plans in solving the issue of air
pollution in cities like Delhi. (250 words)
 How stubble burning in the states of Punjab and Haryana affects the air quality of Delhi? Discuss.

EXTINCTION
News:
 2021:
→ Evironmental activist - Disha Ravi arrested in c/w online toolkit related to 2020-21 Indian farmers’ protest.
 2022:
→ New research says ongoing 6 th mass extinction may be one of most serious environmental threats to
civilisation.This new research says earth was once home to about 2 million known species. However, since
1500, about 13% of said known species may have been lost (about 2.5 lakh different species).
→ Activists of Extinction Rebellion are protesting in many formats.
→ Stanford University warns of imminent mass annihilation of marine species similar to Permian extinction
(250 million years ago) that wiped out most lives in oceans.
→ Australia plans to halt loss of any more species and end its status as "mammal extinction capital of world".
About:
 Mass Extinction / Extinction Event / Biotic Crisis:
→ What:
 widespread and rapid decrease in biodiversity on Earth.
 substantial increase in degree of extinction or when Earth loses more than 3/4th of its species in geologically
short period of time.
 So far, during entire history of Earth, there have been 5 mass extinctions (in last 450 million years).
→ Feature:
 sharp change in diversity and abundance of multicellular organisms.
 It occurs when rate of extinction increases with respect to rate of speciation.
→ Reason:
 catastrophic alterations to environment like - massive volcanic eruptions, depletion of oceanic oxygen,
collision with asteroid.
→ Impact:
 Said 5 mass extinctions led to destruction of about 95% of species of plants, animals, microorganism s
that existed earlier.
 After each mass extinction, it took millions of years to regain species comparable to those that existed
before extinction event.
 loss in crop pollination
 loss in water purification.
 If extincted species has specific function in ecosystem, loss can lead to consequences for other species
by impacting food chain.
 will worsen in coming decades because resulting genetic and cultural variability will change entire
ecosystems.
 Its contribution to human welfare may be lost.
→ Big Five mass extinctions / Big 5 mass extinctions:
 1st mass extinction:
• during Ordovician
• 440 million years ago
• 85% of all species
 2nd mass extinction:
• During Devonian
• 374 million years ago
• 75% of all species
 3rd mass extinction:
• It occurred during Permian Era i.e., 250 million years ago. [During Permian era, land masses collided to form
supercontinent Pangaea. This supercontinent was arid; only few parts received rainfall round year.
However, large Panthalassic Ocean, which covered much of Earth, was home to many marine species].
• This Permian extinction (“Great Dying”) was caused by global warming that left ocean animals unable to
breathe. Roughly 96% of marine species and 70% of land species went extinct. This global warming was
caused by Volcanic eruption i.e., series of volcanic eruptions occurred in central Siberia, injecting massive
amounts of GHG into atmosphere.
Page 462 of 719
 • This Permian extinction was largest extinction and about 95% of all species went extinct.
 4th mass extinction:
• Jurassic
• 200 million years ago
• 80% of all species
 5th mass extinction:
• Cretaceous
• 145 million years ago
• 76% of all species
→ Sixth mass extinction / 6th mass extinction:
 What:
• It is referred to as Anthropocene extinction which is ongoing extinction event of species during present era
(known as Holocene Epoch) due to human activity.
• most serious environmental problem because loss of species will be permanent.
 Cause:
• Mankind’s over-exploitation / misuse of natural resources, fragmentation / loss, natural habitats,
destruction of ecosystems, pollution and global climate change.
 Why humans are responsible?
• Humanity’s one unprecedented threat to many living organisms is humans’ growing numbers.
• Loss of species has been occurring since human ancestors developed agriculture over 11,000 years ago.
Since then, human population has increased from about 1 million to 7.7 billion.
 Changes:
• About 400 vertebrate species went extinct in last century. These extinctions would have taken over 10,000
years in normal course of evolution.
• Many vertebrate species have declining populations.
• Large mammal species lost many of their geographic range in last 100 years.
• Many of species currently endangered (EN) or on brink of extinction are being reduced by legal and illegal
wildlife trade.
• Many mammal species relatively safe 2 decades ago are now endangered like - cheetahs, lions, giraffes,
giant pandas, Sumatran rhinoceros, etc.
• About ½ of animals that once shared our planet are no longer here. This loss is described as “massive erosion
of greatest biological diversity in history of Earth”.
 Vulnerable regions:
• Tropical regions - highest number of declining species. In South Asia, SE Asia, large-bodied mammal species
lost about 4/5thof their historical ranges.
• Temperate zones - fewer species are disappearing, but number is high.
→ Concern now:
 Earth is undergoing similar phase of warming: Studies predict 2 -10 degree C warming lead to many
species getting extinct while other species may migrate from tr opics into polar waters.
 Ocean importance: Oceans are planet’s largest ecosystem accounting for 95% of all spaces available
for life and hosting 90% of planet’s total species.
 Ocean accommodating more heat: Deep oceans are warming up. Ocean heat content is energy
accumulated by ocean. Atmosphere has low heat capacity compared to ocean water, which can
accommodate 1000 times more heat. So, most of heat from GHG is moving into ocean. And now, Ocean
heat content reached record high in 2021.
 Extinction Rebellion (XR) [2018]:
→ What:
 global environmental movement
 global movement seeking to “rebel”, and asks groups to “self-organise”, without need for anyone’s permission,
to come up with collective action plans as long as they adhere to group’s core principles and values.
 It is decentralised, international, politically non-partisan movement using non-violent direct action and civil
disobedience to persuade governments to act justly on Climate and Ecological Emergency.
→ Genesis:
 Launched in UK in 2018 as response to one report by UN IPCC.
→ Aim:
 using non-violent civil disobedience to compel government action to avoid tipping points in: climate system;
biodiversity loss; risk of social and ecological collapse.
→ 3 core demands:
 It wants governments around world to: “Tell the Truth”; “Act Now”; “Go Beyond Politics” to tackle climate and
ecological emergency that world is facing.

Page 463 of 719

 → It also wants to rally support worldwide around common sense of urgency to tackle: climate breakdown and ongoing
6th mass extinction.
→ It used circled hourglass - known as extinction symbol - to serve as warning that time is rapidly running out for many
species.
→ Its activities so far:
 XR group had announced “Declaration of Rebellion” at launch in 2018, involving public act of civil disobedience
in London, demanding that government reduce carbon emission to zero by 2025.
 Eventual plan was to coordinate actions in other countries and to engage in “International Rebellion” in 2019.
 XR global websitestates that movement is “strictly non-violent”, and that they are “reluctant law-breakers”.
 In 2019, Greta Thunberg, teenage Swedish climate activist, lent her support to XR group by speaking to its
members in London.
→ India &XR:
 XR movement claims to have been inspired by 15 major civil disobedience movements around world, including,
Women’s Suffrage, Arab Spring, India’s struggle for Independence.
 XR refers to Mahatma Gandhi’s Salt March in 1930.
 XR’s website says there are 19 groups in India, including in Mumbai, Pune, Delhi, Hyderabad, Bengaluru, Kolkata,
Chennai.
Note:
 There are disagreements as to what constitutes "major" extinction event, and data chosen to measure past diversity.
Question:
 Potential sites for carbon sequestration are: Abandoned and uneconomic coal seams; Depleted oil and gas reservoirs
Subterranean deep saline formations.
Mains Link:
 According to recent research, a sixth mass extinction in Earth’s history is underway and is more severe than previously
feared. Discuss the magnitude, causes and remedial measures needed to halt the extinction. (15M)

CO-OPERATIVE SOCIETY (Articles 243ZH-243ZT) (Part IXB)

(GS2, GS3)
News:
 2021:
→ New ‘Ministry of Cooperation’ has been created.
→ Supreme Court upheld validity of 97th Constitutional Amendment Act, 2011 but strucks down Part IXB of Constitution
[Co-operative Societies], inserted by it related to cooperative societies.
 Reason:
• Supreme Court says Parliament cannot enact laws with regard to cooperative societies because it
is State subject.
 Arguments:
•
{for} {against}
Union argues that provision does not take States argues that provision encroached into
away powers of States to enact laws with exclusive domain of States to enact laws with
regard to cooperatives. regard to cooperatives.
Union argues that provision is to bring
uniformity in management of cooperative
societies in India.
 Remedy:
• Supreme Court says if Union wants to achieve uniformity, then only way available is under Article
252 (Power of Parliament to legislate for 2 or more States by consent and adoption of such legislation by
any other State).
 Current status:
• Now, Part IXB of Constitution is operative only for multi-State co-operative societies, both within
States and Union territories.
 Way Forward:
• Subject of cooperative societies is in State list. Thus, it belongs wholly and exclusively to State
legislatures to legislate upon.Any change on laws of cooperative societies by Parliament, i.e.
changing Lists in 7th Schedule, would require ratification by at least 1/2th of State legislatures as
per Article 368.
 2022:
→ Cooperatives have been onboarded on GeM portal, thus allowing them to procure like other government
agencies. Until now, cooperatives were purchasing from open market.
→ GOI announces constitution of committee for drafting of National Cooperative Policy document to

Page 464 of 719

 strengthen co-operative movement in India.
→ Cooperation Minister Amit Shah says that Amul will be merged with 5 other cooperative societies to form
a Multi-State Cooperative Society (MSCS). [Significance: MSCS will ensure the export of the products after
its certification so that profit can go directly into the bank accounts of the farmers].
→ Union Cabinet approves amendments to Multi-State Co-operative Societies Act, 2022 to bring transparency
in the sector and reform the electoral process. The amendments have been brought in to improve the ease
of doing business.
Constitution:
 Article 19 (Protection of certain rights regarding freedom of speech, etc) :
→ All citizens shall have right:
 …
 to form associations or unions or co-operative societies.
 …
→ …
 Article 43B (Promotion of co-operative societies):
→ state shall endeavour to promote voluntary formation, autonomous functioning, democratic control,
professional management of co-operative societies.
 Part IXB (Co-operative societies) – Article 243ZH-243ZT.
About:
 What:
→ autonomous association of persons united voluntarily to meet their common economic, social, cultural needs and
aspirations through jointly-owned enterprise. It is voluntary association of individuals having common needs who
join hands for common economic interests, based on principle of voluntary and open membership, autonomy to
members and community concerns.
Cooperatives are people-centred enterprises owned, controlled and run by and for their members to
realise their common economic, social, and cultural needs and aspirations.
 Definition:
→ Constitution Article 243ZH (Part IXB – Co-operative Societies) defines co-operative society as society registered or
deemed to be registered under any law relating to co-operative societies for time being in force in any State.
→ Constitution Article 243ZH (Part IXB – Co-operative Societies) defines multi-State co-operative society as society with
objects not confined to one State and registered or deemed to be registered under any law relating to co-operative
societies for time being in force.
 Constitutional:
→ Words “co-operative societies” were added in Article 19 (fundamental right).
→ New Article 43B was added in Directive Principles of State Policy (Part IV) regarding promotion of cooperative
societies.
→ As part of Article 171, Governor can nominate person having special knowledge or practical experience in co-
operative movement to State Legislative Council.
→ Added new Part IXB regarding cooperatives working in India. [now struck down]
→ Co-operative societies is under ‘State list’ in 7th schedule.
 History:
→ 1st credit cooperative society was formed in Banking in 1903. Cooperative got legal status with enactment of Co-
operative Credit Societies Act, 1904, which was replaced later by Co-operative Societies Act, 1912.
 Feature:
→ democratically owned by their members, with each member having 1 vote in electing board of directors.
→ balance between profitability need and needs of members and wider interest of community.
 Government initiatives:
→ Multi-State Cooperative Societies Act, 2002.
→ National Policy on Cooperatives, 2002: to provide support for promotion and development of cooperatives as
autonomous, independent and democratic organizations so that they can play their due role in socio-economic
development of country. This existing National Policy on Cooperatives was formulated in 2002 with objectives of
facilitating all round development of cooperatives and providing necessary support, encouragement and assistance
to them, so as to ensure that cooperatives work as autonomous, self-reliant and democratically managed institutions
accountable to their members and make significant contribution to Indian economy.
→ Ministry of Cooperation [2021]:
 Aim:
• strengthening cooperative movement in India
 Roles / Function:
• provide separate administrative, legal, policy framework for strengthening cooperative movement in India.
help deepen cooperatives as true people-based movement reaching up to grassroots. streamline processes

Page 465 of 719

 for cooperatives [for ease of doing business]. development of multi-state cooperatives (MSCS). To realize
vision of ‘Sahkar se Samriddhi’ (Prosperity through Cooperation).
 Status:
→ India has around 5 lakh Cooperative societies (around 29 crore members) under various categories - agro-
processing, dairying, fisheries, etc.
Note:
 Co-operative Societies Act, 1912:
→ Act to amend Law relating to Co-operative Societies. WHEREAS it is proper further to facilitate formation
of Co-operative Societies for promotion of thrift and self -help among agriculturists, artisans and persons
of limited means, and for that purpose to amend law relating to Co -operative Societies.
 Constitution (97th Amendment) Act, 2011:
→ What:
 management of co-operative societies in India.
→ Provisions:
 In Part III of Constitution, in Article 19, words “or co-operative societies” shall be inserted. [upheld in
2021]
 In Part IV of Constitution, following Article shall be inserted as: [upheld in 2021]
• “43B. Promotion of co-operative societies. — state shall endeavour to promote voluntary formation,
autonomous functioning, democratic control, professional management of co-operative societies.”
 In Constitution, Part IXB (Co-operative Societies) shall be inserted. [struck down in 2021]
Value Addition:
 2012 - International Year of Cooperatives (by UNGA)
 Main types of Cooperative Societies:
→ Consumers’ Co-operative Societies, Producers’ Co-operative Societies, Co-operative Marketing Societies, Co-
operative Housing Societies, Co-operative Credit Societies, Co-operative Farming Societies.
Mains Link:
 Write a note on the history of cooperative movement in India.
 Discuss the impact of latest Supreme Court order on cooperative societies.

LIVESTOCK
News:
 2021:
→ World Organisation for Animal Health (OIE), WHO, UNEP say halt sale of live wild mammals in food markets to
prevent emergence of new diseases such as Covid-19. Why: Animals, particularly wild animals, are source of most
emerging infectious diseases in humans - novel viruses etc.
 2022:
→ Haryana authorities ban inter-district and inter-State transportation of wheat fodder.
→ Gujarat introduces Bill to regulate stray cattle in urban areas.
 Aim:
• to regulate stray cattle in urban areas
 Feature:
• mandatory to obtain licence from authority (Assembly, municipal corporation or municipality) to keep cattle
which include buffaloes, cows, their calves and heifers, bulls, bullocks, goats, sheep and donkeys. [Licence
is to ensure that owners have sufficient space for cows]. Any cattle outside licensed cattle-sheds will be
impounded. State government can notify entire or part of urban area as prohibited zone for cattle.
 Need:
• Almost all major cities and towns have been grappling with stray cattle menace. Over past years, Rajkot
Municipal Corporation (RMC) has impounded 72,000 cattle heads straying on city roads. Besides loss of
human lives and injuries in accidents involving cattle on city roads. dheavy financial cost also.
→ Accusing Karnataka Government of creating fear psychosis among farmers using Karnataka Prevention of Slaughter
and Preservation of Cattle Act, 2020, one convention of dairy farmers demands that this legislation be scrapped in
their interest.
→ Assam Cattle Preservation Act, 2021, cow protection law that Assam enforced about 1 year ago, has led to acute beef
crisis in Meghalaya, leading to closure of its main cattle market due to non-availability of animal for consumption.
[Various pressure groups in Assam had held rally against this Assam’s Act, stating that this Assam’s law was assault
on farm economy in name of religion.
→ According to one report of World Animal Protection – “Climate change and cruelty: revealing true impact of factory
farming” – released in 2022, factory farming of animal products for human consumption is fueling climate change.
→ Cooperation Minister Amit Shah says that Amul will be merged with 5 other cooperative societies to form
a Multi-State Cooperative Society (MSCS).
→ Sandeep Sharma (a scientist and now CEO of Neat Meats) says that in some months, it would be possible
to have a lab-grown meat burger. [Neat Meats is among a handful of Indian companies that are employing
Page 466 of 719
 advances in cell biology and protein synthesis to solve a global challenge: how to ensure that a rising world
population gets better, cheaper protein from fewer animals and diminishing cultivable land ]. [This means,
Indian start-ups are working on to tap potential of lab-grown meat. They are employing advances in cell
biology and protein synthesis to solve a global challenge of getting better, cheaper protein from fewer
animals].
→ There is a sudden increase of celebrity interest in 'plant-based' meat and dairy.
→ In a major breakthrough in creating immunity in cattle against infectious diseases including mastitis, researchers of
University of Trans-Disciplinary Health Sciences and Technology (TDU), Bengaluru successfully validate the
immunomodulation ability (modulation i.e. regulatory adjustment of immune system) of a natural phytochemical
compound with curcumin as the active ingredient.
Constitution:
 Article 48 (Organisation of agriculture and animal husbandry):
→ state shall endeavour to organise agriculture and animal husbandry on modern and scientific lines and shall, in
particular, take steps for preserving and improving breeds, and prohibiting slaughter, of cows and calves and other
milch and draught cattle.
About:
 What:
→ part of Agriculture sector. milk and animal husbandry. Livestock and Animal Husbandry - Statel list under
7th schedule.
 Status:
→ India has livestock population of 1.6 billion and approximately 280 million farmers rely on livestock and
related industries for livelihood.
→ India’s annual per capita consumption of fish and chicken is at 6 kg and 4.5 kg respectively, as against only
700-800 gm for mutton.
 Law on cattle:
→ Need:
 There is rise of illegal cattle smuggling along India -Bangladesh border despite deployment of adequate
security forces. According to Union government, B SF seized 476,035 head of cattle between 2016 and
2020 along Indo-Bangla border.
→ Challenges:
 Assam shares 263 km of border with Bangladesh, both in land and in riverine. In Assam, there are many
exit points along porous India-Bangladesh border that facilitate illicit cattle smuggling. Smuggling also
happens through WB and Meghalaya which also share border with Bangladesh. Some years ago, BSF
had identified 65 cattle corridors along Indo-Bangla border and had recommended certain measures
to stop cattle smuggling. Assam police often claim that Assam’s law doesn’t allow them to stop
someone from transporting cattle to another State. If arrested, smugglers can claim that these are
personal cattle.
→ Fact:
 Prohibition of cow slaughter is also one of DPSP contained in Article 48.
 Dairy industry:
→ India’s dairy industry is massive and it is by far India’s largest agricultural product. India’s farmers earn
more from dairy than wheat and rice put together. Dairy farming in India functions on small margins.
→ India has the potential to export its milk and milk products to nations like Bhutan, Nepal, Bangladesh, Sri
Lanka.
→ India is the top milk producer and has the highest cattle population in the world. Uttar Pradesh is the
highest milk-producing State in India (about 18% of total).
 Cow-Based Economy:
→ Cow has been integral part of rural India. Indian cow breeds possess genetic capacity that produces better
quality milk. Milk so produced contains higher level of Conjugated Linoleic Acid (CLA) which is anti -
carcinogenic. Cow urine can be used as bio-fertilizer which helps in increasing crop production with
reduced costs.
 Animal Health:
→ Issue:
 Risk of Zoonotic disease (may cause estimated annual loss of USD 12 billion to Indian economy).
Around 9,580 instances of Zoonotic disease outbreaks from 2000 to 2010. Health policies has largely
been human-centric.
→ Initiative:
 Department of Animal Husbandry and Dairying (DAHD) has set up one dedicated ‘One Health Unit’ in
collaboration with Gates Foundation. One Health is one approach that recognizes that health of people
is closely connected to health of animals and our shared environment. National Digital Livestock
Mission (NDLM) is helping create Animal Pandemic preparedness. Empowered Committee for Animal
Health (ECAH) to streamline animal health regulatory ecosystem in India.
Page 467 of 719
 Factory Farm:
→ What:
 Factory farms, also known as Concentrated Animal Feeding Operations (CAFO), are one modern industrial
method of raising farmed animals, who are collectively known in industry parlance as livestock. At its core,
factory farming is one form of intensive agriculture designed to maximize profits using as few resources as
possible. On factory farms, large numbers of animals are confined in small spaces, which often means keeping
animals indoors for duration of their lives. Factory farming refers to intensive livestock production that
maximises output at lowest cost.
→ Usage:
 Factory farming is primary way that USA and many other countries produce popular animal products like
hamburgers, cheese, eggs.
→ Issue:
 According to one report of World Animal Protection – “Climate change and cruelty: revealing true impact of
factory farming” – released in 2022, factory farming of animal products for human consumption is fueling climate
change. And, across major hot spots, annual consumption of chicken alone creates same climate change impact
as keeping 29 million cars on road for 1 year.
→ Way Forward:
 World Animal Protection asked governments in world to stop giving approval for new factory farms for next 10
years. It called for reducing animal production by at least 50% by 2040 and insisted on introducing compulsory
minimum welfare standards for animals.
 Meat alternative / Meat substitute / Plant-based meat / Fake meat:
→ What:
 A meat alternative is a food product made from vegetarian or vegan ingredients, eaten as a
replacement for meat. Meat alternatives typically approximate qualities of specific types of meat, such
as mouthfeel, flavor, appearance, or chemical characteristics. Plant- and fungus-based substitutes are
frequently made with soy (eg. tofu, tempeh, textured vegetable protein), but may also be made from
wheat gluten as in seitan, pea protein as in the Beyond Burger, or mycoprotein as in Quorn.
“Plant-based” refers to products that bio-mimic or replicate meat, seafood, eggs, and milk
derived from animals — by looking, smelling, and tasting like them.
→ History:
 Meat substitution has a long history. Tofu was invented in China as early as 200 BCE, and in the Middle
Ages, chopped nuts and grapes were used as a substitute for mincemeat. Since 2010s, startup
companies such as Impossible Foods and Beyond Meat have popularized pre-made plant-based
substitutes for ground beef, patties, and vegan chicken nuggets as commercial products.
→ Feature:
 Meat alternatives are typically consumed as a source of dietary protein by vegetarians, vegans, and
people following religious and cultural dietary laws. However, global demand for sustainable diets has
also increased their popularity among non-vegetarians and flexitarians seeking to reduce the
environmental impact of meat production.
→ Process of making:
 Plant-based meat can be produced using various things utilizing plant proteins or soy proteins. The
challenge lies in replicating muscle tissue that plants don’t have. As for plant-based dairy, the main
products are milk from oats, almonds, soybean, coconut, and rice. Among these, oat milk is considered
the closest to regular milk.
→ Lab-grown / cultured meat vs plant-based meat:
 Plant-based meat is made from plant sources such as soy, pea protein, while cultured meat is grown
directly from cells in a laboratory.
→ Status:
 In 2022, Sandeep Sharma (a scientist and now CEO of Neat Meats) said that in some months, it would
be possible to have a lab-grown meat burger.
 In 2022, there was a sudden increase of celebrity interest in 'plant-based' meat and dairy.
 Globally, retail sales of plant-based animal product alternatives in the US stood at USD 7.4 billion in
2021 (has grown from USD 4.8 billion in 2018).
 Scope in India: Probably not much, at least in dairy.
→ Initiative:
 Indian start-ups are working on to tap potential of lab-grown meat. They are employing advances in
cell biology and protein synthesis to solve a global challenge of getting better, cheaper protein from
fewer animals. Example - Neat Meats (one Indian food startup) is among a handful of Indian companies
that are employing advances in cell biology and protein synthesis to solve a global challenge: how to
ensure that a rising world population gets better, cheaper protein from fewer animals and diminishing
cultivable land].

Page 468 of 719

 → Challenge:
 Meat alternative industry faces hurdles like dealing with consumer mistrust, resistance from traditional
meat producers.
→ Significance:
 Plant-based meat offer alternatives to traditional meat products that could feed a lot more people,
reduce the threat of zoonotic diseases, and mitigate the environmental impact of meat consumption.
 Significance:
→ Animal Husbandry is source of reliable alternative income for farmers, Diary Industry (USD 160bn
economy), Meat Industry (USD 50bn economy). Many farmers depend upon animal husbandry for their
livelihood. supports livelihood of maximum of rural populat ion. India - highest livestock owner in world.
According to Livestock Census, total Livestock population in India has increased.
Note:
 Mastitis in dairy cattle:
→ What:
 Mastitis in bovine is called Bovine mastitis. It is the persistent, inflammatory reaction of the udder tissue due to
physical trauma or microorganisms infections. Bovine mastitis is an inflammation of the mammary gland caused
from trauma or an infection, leading to abnormal and decreased milk production. [Mastitis is inflammation of
the breast or udder, usually associated with breastfeeding].
 Bovine Mastitis is infection / inflammation of udder. potentially fatal mammary gland infection. common
ailment in dairy animals.
→ Cause:
 by microorganisms ranging from virus, mycoplasma, fungus, bacteria. Physical injury to mammary
region, poor hygiene, trauma.
→ Symptom:
 Inflammation of the udder into a red-hard mass with pain, milk yield totally stops or is severely restricted, milk
produced contains blood clots and has a foul smell.
→ Remedy:
 No vaccination is available against mastitis.
 Anti-inflammatory and antibiotic treatment is used as applicable.
 Prevention and control of mastitis require consistency in sanitizing the cow barn facilities.
 proper milking procedure.
 segregation of infected animals.
 Treatment of the disease is carried out by penicillin injection.
→ Impact:
 affects farm productivity due to fall in milk quality, thus impacting income-generating activities.
Causes significant economic losses to dairy industry. Most costly disease affecting dairy cattle in world.
 Economic loss: Economic loss due to mastitis in India exceeds Rs. 13000 crores annually.
→ Concern:
 Mastitis is a potentially fatal mammary gland infection.
 Bovine Mastitis is the most common disease in dairy cattle in USA and worldwide.
 Bovine Mastitis is also the most costly disease to the dairy industry.
 Mastitis in cows is one of the most common diseases plaguing the dairy industry.
 Fodder / provender:
→ What:
 Any agricultural foodstuff used specifically to feed domesticated livestock, such as cattle, rabbits,
sheep, horses, chickens and pigs. It refers particularly to food given to animals (including plants cut
and carried to them), rather than that which they forage for themselves (called forage). Fodder
includes hay, straw, silage, compressed and pelleted feeds, oils and mixed rations, and sprouted grains
and legumes (such as bean sprouts, fresh malt, or spent malt). Most animal feed is from plants, but
some manufacturers add ingredients to processed feeds that are of animal origin.
→ Initiative:
 Haryana:
• In 2022, Haryana authorities banned inter-district and inter-State transportation of wheat fodder.
 Reason:
o There may be shortage of fodder for animals in district if same is sent out from that district.
Situation is likely to worsen in future in absence of rains. More farmers opting for mustard crop in
place of wheat in southern Haryana. There is lower production of wheat because of early onset of
summer coupled with exceptional rise in mercury this year in 2022. Because of geopolitical tensions
amid 2022 Russia-Ukraine war, perception is building that wheat prices would increase in near
future. Haryana authorities want to meet local needs of fodder before allowing same for other
States.

Page 469 of 719

  Criticisms:
o This decision is drawing criticism from farmer groups and Opposition. Farmer groups say, Haryana
authorities are not allowing farmers to earn profit by selling their fodder at higher prices when they
are already hit by low production of wheat this year in 2022.
 Karnataka Prevention of Slaughter and Preservation of Cattle Act, 2020:
→ Farmers’ demands:
 In 2022, accusing Karnataka Government of creating fear psychosis among farmers using this
legislation, one convention of dairy farmers demanded that this legislation be scrapped in their
interest. They demand that Karnataka government should buy infertile cows from farmers at market
rates till it withdraws this legislation.
→ Provisions:
 Police officers ranked sub-inspector and above or competent authority will have power to search
premises and seize cattle and materials used or intended to use to commit offence. Such seizures will
then be reported before Sub Divisional Magistrate without unreasonable delay. [This is one
controversial provision]. It is cognizable offence, violators can attract some years of imprisonment.
Penalty can range from Rs. 50,000 to Rs. 10 lakh.
→ Concerns:
 Police were harassing farmers by using provisions of this legislation. Wh ile farmers are under watch
by banning cow slaughter, sale and export of beef by corporates is not banned. Farmers are banned
from selling their cows to slaughter houses even if they were infertile. This results in more number of
farmers, particularly dairy farmers, quitting agriculture and allied activities. Even transport of cattle
had become difficult as farmers needed to take permission from various authorities concerned even
for it.
→ Impact:
 Dairy industry / sector will take largest hit from this legislation. India’s dairy industry is massive and it
is by far India’s largest agricultural product. India’s farmers earn more from dairy than wheat and rice
put together. Problem with this legislation is that slaughter is integral to dairy industry’s eco nomic
functioning. Dairy farming in India functions on small margins. As result, upkeep of unproductive
animals would throw their bottom lines out of alignment.
 World Organisation for Animal Health (OIE) [1924]:
→ What:
 formerly known as Office International des Epizooties (OIE). Intergovernmental org. Created to fight animal
diseases at global level.
→ Aim:
 coordination, support and promotion of animal disease control. i.e. control epizootic (related to animal)
diseases. prevent their spread. improvement of animal health worldwide.
 World Animal Protection [1981]:
→ formerly World Society for Protection of Animals (WSPA). It is international non-profit animal rights organization. Its
vision is - world where animal rights matter and animal cruelty has ended. This charity has regional hubs in: Africa,
Asia, Europe, Latin America and North America, and offices in 14 countries. Its headquarters is in London.
Value Addition:
 WTO Agreement on Application of Sanitary and Phytosanitary Measures recognises OIE as international standard setting
organisation for animal health and zoonotic diseases.
 Terrestrial Animal Health Code (TAHC) of OIE:
→ World Organisation for Animal Health (OIE) Terrestrial Animal Health Code (TAHC) implements standards of
worldwide animal health and welfare and public health from veterinary point of view. TAHC includes standardized
international trade in terrestrial biological specimens – mammals, birds etc. African Swine Fever (ASF) - one disease
listed in OIE TAHC.
 Rashtriya Gokul Mission [2014]:
→ What:
 Mission to conserve and develop indigenous bovine breeds, under National Programme for Bovine
Breeding and Dairy Development (NPBBDD).
→ Objective:
 Development of indigenous breeds. Conservation of indigenous breeds. Undertake breed
improvement programme for indigenous cattle breeds [to improve genetic makeup, to increase stock].
Enhance milk production and productivity. Upgrade nondescript cattle using elite indigenous breeds -
Gir, Sahiwal, Rathi, Deoni, Tharparkar, Red Sindhi. Distribute di sease free high genetic merit bulls for
natural service.
→ Implementation:
 Department of Animal Husbandry and Dairying (under Ministry of Animal Husbandry, Dairying and
Fisheries) is implementing RGM for development and conservation of indigenous bovine breeds since
December 2014.
Page 470 of 719
  implemented through Livestock Development Boards of State Implementing Agency (SIA’s LDB’s). State
GausevaAyogs are mandated to sponsor proposals to SIA’s (LDB’s) and monitor implementation of
sponsored proposal. Participating Agencies: ICAR, Universities, Colleges, NGO’s, Cooperative Societies,
Gaushalas.
→ Funding:
 All the components of the scheme will be implemented on 100% grant-in-aid basis except the
components of:
• accelerated breed improvement programme under the component subsidy of Rs 5000 per IVF pregnancy
will be made available to participating farmers as GoI share;
• promoting sex sorted semen under the component subsidy upto 50% of the cost of sex sorted semen will
be made available to participating farmers; and
• establishment of breed multiplication farm under the component subsidy upto 50% of the capital cost
maximum upto Rs.2.00 crore of the project will be made available to entrepreneur.
→ Gokul Gram:
 What:
• integrated cattle development centers. established under RashtriyaGokul Mission. to develop indigenous
breeds including some nondescript breeds.
 Place of establishment:
• Native breeding land. Near metropolitan cities for housing urban cattle.
 Objective:
• Promote indigenous cattle rearing and conservation in scientific manner. Propagate high genetic merit bulls
of indigenous breeds. Optimize modern Farm Management practices. Promote Common Resource
Management. Utilize animal waste - Cow Dung, Cow Urine - in economical way.
 Feature:
• self-sustaining and will generate economic resources from sale of: milk, organic manure, vermi-compost,
urine distillates, electricity from bio gas for in-house consumption, animal products. will also function as in-
situ training centre for farmers, breeders. centres for development of Indigenous Breeds. high genetic
breeding stock [for supply to farmers]. Gokul Gram will also have capacity to maintain about 1000 animals.
in-house fodder production [to provide nutritional requirements to animals]
 Rashtriya Kamdhenu Aayog [2019]:
→ high powered permanent apex advisory body. mandated to help Union Government to develop
programmes for conservation, sustainable development, genetic upgradation of indigenous breeds of
cows. under Ministry of Fisheries, Animal Husbandry and Dairying. i ntegral part of RashtriyaGokul Mission.
Mains Link:
 Discuss why there is a need to halt the sale of live wild mammals in food markets to prevent the emergence of new
diseases such as COVID-19.
 Discuss the potential of India’s dairy sector.
 Write a note on RashtriyaGokul Mission.
 Discuss the rationale behind and implications of anti slaughter laws.

MOON MISSION / LUNAR MISSION / MISSION TO MOON / MISSIONS TO MOON

News:
 2019:
→ Chandrayaan 2 got lost after it hard landed on dark side of Moon [failed to make soft-landing]. Though, it
remains active in form of its orbiter hovering over Moon].
 2020:
→ ISRO pays tribute to Dr. Vikram Sarabhai by announcing that Chandrayaan 2 orbiter has captured images
of Sarabhai crater, of Moon.
→ Chinese spacecraft Chang’e-5 carrying lunar rocks and soil began its journey back to Earth. [1 st country to
successfully retrieve lunar samples since 1970s]
→ Chang’e-5 successfully landed in Mongolia. [China only 3rd country to have retrieved lunar samples after
US, Soviet Union].
 2021:
→ NASA chose SpaceX to build lander for its Artemis programme and this lander is based on SpaceX Starship.
→ Prototype of futuristic Starship rocket developed by Elon Musk’s SpaceX company, was launched and
successfully landed, pointing towards new era in space exploration for NASA.
→ Chandrayaan-2, hovering over Moon, finds new developments on hot outermost layer of Sun (Solar
Corona). These include finding of abundances of magnesium, aluminium, silicon. And microflares were
observed, providing new insights about coronal mass heating.
→ NEA Scout will be one of payloads on Artemis I.
→ NASA announced that it will launch VIPER mission in 2023.

Page 471 of 719

 → Chandrayaan-2 mission have gathered new information about Moon and its environment.
→ NASA choses landing site for VIPER mission. [on Nobile crater, near lunar south pole].
 2022:
→ Government informs Lok Sabha that ISRO is set to launch Chandrayaan-3 in August 2022.
→ NASA launches CAPSTONE.
→ ISRO maps out the global distribution of sodium on the Moon’s surface. ISRO used the CLASS instrument
(Chandrayaan-2 Large Area Soft X-ray Spectrometer) carried by the 2nd Indian Moon mission, Chandrayaan-2. That
is, Chandrayaan-2 finds that there are sodium atoms that are weakly bound to the lunar surface. [When compared
to Earth, the moon is significantly depleted of volatile elements such as sodium. Sodium is the only element apart
from potassium that can be observed through telescopes in the lunar atmosphere (its exosphere)].
 Significance:
• This new map of sodium would enable understanding of the Moon’s surface-exosphere connection. It can
also be used as a tracer of the volatile history of the moon.
About:
 Moon Exploration History:
→ In 1959, Soviet Union’s uncrewed Luna 1 and Luna 2 became 1strover to visit Moon.
→ USA sent 3 classes of robotic missions between 1961 and 1968.
→ In 1969, USA sent Apollo 11 mission to Moon in which American astronauts walked on surface of Moon.
→ In 1990s, USA resumed lunar exploration with robotic missions Clementine, 1994 and Lunar Prospector, 1998.
→ In 2009, USA began new series of robotic lunar missions with launch of Lunar Reconnaissance Orbiter (LRO), 2009
and Lunar Crater Observation and Sensing Satellite (LCROSS), 2009.
→ In 2011, NASA began Artemis, 2017.
→ In 2012, Gravity Recovery and Interior Laboratory (GRAIL) spacecraft studied Moon’s gravity.
→ Also, European Space Agency, Japan, China, India sent missions to explore Moon.
→ China landed 2 rovers on Moon’s surface, which includes 1st-ever landing on Moon’s far side in 2019.
 ARTEMIS [2017]:
→ What:
 Acceleration, Reconnection, Turbulence and Electrodynamics of Moon’s Interaction with Sun.
 NASA led international human spaceflight program to Moon.
 NASA’s next mission to Moon.
→ Objective:
 To measure what happens when Sun’s radiation hits our rocky moon, where there is no magnetic field to protect
it.
 exploration of Moon, including crewed and robotic exploration of lunar surface.
 to establish sustainable human presence on surface of Moon by 2028.
 Find and use water, critical resources needed for long-term exploration.
 Investigate Moon’s mysteries and learn more about our home planet, universe.
 Learn how to live and operate on surface of another celestial body (moon).
 Prove technologies we need before sending astronauts on Mars missions.
→ Mission details:
 NASA’s powerful new rocket [Space Launch System (SLS)], will send astronauts aboard Orion spacecraft to lunar
orbit.
 Astronauts will dock Orion at Gateway and transfer to one human landing system for expeditions to surface of
Moon.
 Astronauts will return to orbital outpost to board Orion again before returning safely to Earth.
→ Consists of:
 Artemis I:
• to be launched in 2022
• uncrewed test flight around Moon
• test deep space exploration systems
 Artemis II:
• to be launched in 2024
• crewed flyby mission around Moon
• lunar flyby test and return to Earth.
• test deep space exploration systems
 Artemis III:
• to be launched in 2025
• crewed mission to be landed on Moon.
• 1st crewed lunar landing mission since Apollo, 1972.
→ Significance:

Page 472 of 719

  If successful, it will be 1st crewed lunar mission since Apollo program, 1972.
 Chandrayaan-2 [2019]:
→ What:
 India’s 2nd mission to Moon
 Also, ISRO used it to study Sun too.
→ Objective:
 exploring south pole of Moon.
 to demonstrate ability to soft-land on lunar surface
 operate robotic rover on surface.
 Study Moon’s exosphere, moon surface, sub-surface of moon.
→ Component:
 Orbiter of Moon
 Vikram (after Vikram Sarabhai) – lander
 Pragyan (wisdom) – rover
 Note: All components equipped with scientific instruments to study moon.
→ Present:
 In 2019, Chandrayaan 2 was lost after it hard landed on dark side of Moon. But, it remains active in form of its
orbiter hovering over Moon.
→ Relevancy:
 Despite 2019 failure, Chandrayaan-2 mission’s orbiter and other parts have been functioning normally,
gathering information.
 Recently, ISRO released information gathered so far:
• Presence of water molecules on moon:
 Chandrayaan-2mission has given most precise information, till date, about presence of H2O molecules
on Moon.
• Presence of Minor elements:
 Chromium, Manganese, Sodium are detected for 1st time.
 This finding may help understand magmatic evolution on Moon; nebular conditions; and planetary
differentiation.
• Information about solar flares:
 Microflares outside active region are observed for 1st time
 This finding may help understand mechanism behind - heating of solar corona [open problem for many
decades].
• Exploration:
 Exploration of permanently shadowed regions, craters, boulders underneath regolith, loose deposit
comprising top surface
 This finding may help scientists to zero in on future landing, drilling sites, human missions.
 Chang’e-5 Probe [2020]:
→ What:
 unmanned spacecraft
 named after Chinese mythical moon goddess.
 China’s Moon mission.
→ Objectives:
 Retrieval of lunar samples - rocks and soil.
→ Composition:
 orbiter, ascender, lander, returner.
→ Significance:
 Return of moon’s surface sample to Earth
 unmanned mission
 docking in lunar orbit
→ Findings:
 mare basalts [volcanic rocks on Moon from ancient eruptions of lava on Moon].
 Presence of exotic chemical compositions in rocks [from other parts of lunar surface or space rocks that impacted
Moon’s surface].
 glassy droplets [from now extinct volcanic vents - ‘Rima Mairan’ and ‘Rima Sharp’]
 Chandrayaan 3:
→ What:
 planned mission
 repeat / successor of Chandrayaan-2 mission [will only include lander, rover similar to that of Chandrayaan-2,
but will not have orbiter].
 It will likely attempt another soft-landing on lunar surface
Page 473 of 719
  less costlier than Chandrayaan-2 mission
 Viper Mission:
→ What:
 Volatiles Investigating Polar Exploration Rover
 lunar rover / mobile robot
 1st resource mapping mission on any other celestial body.
 by NASA
→ Objectives:
 To explore moon’s south pole region.
 prospecting for lunar resources in permanently shadowed areas in lunar south pole region, especially by
mapping distribution and concentration of water ice.
 to understand if it is possible for human life to sustain on moon, by using resources available on moon
 Help create lunar resource maps.
 Evaluate concentration of water, other potential resources on moon’s surface.
→ Function:
 VIPER will search for lunar crater of ice – which could provide drinking water, air, rocket fuel needed for future
manned missions to Moon.
→ Significance:
 NASA VIPER’s findings will inform about future landing sites for NASA’s Artemis programmeby helping to
determine locations where water, other resources can be harvested so as to sustain humans over extended stays
on moon.
 CAPSTONE [2022]:
→ What:
 Cislunar Autonomous Positioning System Technology Operations and Navigation Experiment
 It is one lunar orbiter that will test and verify calculated orbital stability planned for Lunar Gateway space station.
This spacecraft is one CubeSat that will also test navigation system that will measure its position relative to
NASA's Lunar Reconnaissance Orbiter (LRO) without relying on ground stations (autonomous navigation
software). It will fly around Moon.
 It is microwave oven-sized CubeSat weighing just 25 kg.
→ Purpose:
 It is NASA's newly launched satellite that will test unique lunar orbit that will be used by future missions. It is
designed to test unique, elliptical lunar orbit known as Near-rectilinear halo orbit (NRHO) which is significantly
elongated, and is located at one precise balance point in gravities of Earth and Moon. This offers stability for
long-term missions like Lunar Gateway.
→ Significance:
 If tested successfully, CAPSTONE software will allow future spacecraft to determine their location without having
to rely exclusively on Earth-based tracking.
 Why study moon?
→ Moon is closest cosmic body at which space discovery can be attempted and documented.
→ Moon mission is also promising test bed to demonstrate technologies required for deep-space missions.
→ Moon provides best linkage to Earth’s early history.
→ Moon offers undisturbed historical record of inner Solar system environment.
→ Why exploration target Moon’s South Pole (Lunar South Pole)?
 Lunar South pole’s surface area remains in shadow which is much larger than that at North Pole.
 There could be possibility of presence of water in permanently shadowed areas around it.
 South Pole region has craters that are cold traps and contain fossil record of early Solar System.
Note:
 Near-Earth Asteroid (NEA) Scout:
→ What:
 small spacecraft.
 to fly by and collect data from near-Earth asteroid.
 NASA’s 1st interplanetary mission using solar sail propulsion.
→ Significance:
 It will capture images of near-Earth asteroid, to study about NEA.
 develop strategies for reducing potential damage that may be caused by NEA in event of impact.
 Even before Chandrayaan-2, below missions have revealed information regarding presence of water on moon:
→ Chandrayaan-1
→ Clementine mission (NASA)
→ Lunar Prospector mission (NASA)
 SpaceX Starship:
→ fully reusable, two-stage-to-orbit super heavy lift launch vehicle
Page 474 of 719
 → under development by SpaceX company, USA
→ It consists of booster stage named Super Heavy; and 2nd stage named Starship.
→ Unusual for traditional launch vehicle’s 2nd stage, Starship’s 2nd stage is designed for long duration cargo; and
passenger carrying spacecraft.
Value Addition:
 In 1969, Neil Armstrong along with Edwin “Buzz” Aldrin became 1 st human to step on Moon as part of Apollo 11 mission.
 Solar Cruiser:
→ NASA’s solar sail mission
→ to test large solar sail at artificial orbit between Earth and Sun
→ Solar sails are spacecraft that use large, thin sails to reflect sunlight, giving them a gentle push and unlimited fuel, to
reach unique orbits and perhaps one day visit other stars
→ Solar Cruiser’s sail will be largest ever test in space.
Mains Link:
 Discuss the significance of Chandrayaan-2 mission.
 Write a note on NASA’s Artemis program.

ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT (OECD) [1961]

News:
 2022:
→ OECD reports that:
 Russian invasion of Ukraine could reduce global growth rate by 1% this year and increase inflation by 2.5%.
 Ukrainewar’s impact on EU could be high because of its high dependence on Russia’s energy imports.
 OECD countries through increased government spending could lessen impact of inflation.
→ OECD creates a new global tax transparency framework - Crypto-Asset Reporting Framework (CARF) - for the
automatic exchange of information related to crypto assets between countries.
About:
 What:
→ intergovernmental economic organisationfounded to stimulate economic progress and world trade.
→ forum of countries describing themselves as committed to democracy and market economy, providing platform to
compare policy experiences, seek answers to common problems, identify good practices and coordinate domestic
and international policies of its members.
→ OECD is official UN observer.
→ headquarters - Paris, France
 Objective:
→ To foster economic development and cooperation and fight poverty through the promotion of economic stability.
 Origin:
→ In 1948, Organisation for European Economic Co-operation (OEEC)was established to help administer Marshall Plan
(which was rejected by Soviet Union and its satellite states). This would be achieved by allocating USA financial aid
and implementing economic programs for reconstruction of Europe after World War II.In 1961, OEEC was reformed
into OECD and membership was extended to non-European states.
 Feature:
→ Majority of OECD members are high-income economies with very high Human Development Index (HDI) and are
regarded as developed countries.
→ OECD member countries collectively comprised about 62% of global nominal GDP, about 42% of global GDP at
purchasing power parity.
→ committed to democracy and market economy.
→ It compares policy experiences, seek answers to common problems, identify good practices and coordinate domestic
and international policies of its members.
 Members:
→ 38 member countries.
 Structure:
→ OECD Council:
 provides direction and guidance to work of OECD.
 Each member country is represented.
→ OECD Substantive Committees:
 Oversees all work on each theme (publications, task forces, conferences, etc)
→ OECD Secretariat:
 led by Secretary-General
 provides support to Standing and Substantive Committees.
 Funding:
→ OECD is funded by contributions from member countries at varying rates.

Page 475 of 719

  Mechanism:
→ It works through consensus to develop policy recommendations and other “soft law” instruments to
encourage policy reform in member countries.
 Significance:
→ OECD is recognised as highly influential publisher of mostly economic data through publications, annual evaluations,
rankings of member countries.
 India:
→ India is not an OECD member but has had a cooperation program since 1997. key partner of OECD.
Value Addition:
 Green Growth:
→ It means fostering economic growth and development, while ensuring natural assets continue to provide
resources and environmental services on which our well -being relies.
→ OECD is helping to guide green and sustainable growth.

GEO-SPATIAL DATA / GEOSPATIAL DATA

News:
 2021:
→ Govt. liberalises Geospatial data policy.
 2022:
→ At the inaugural of the 2 nd UN World Geospatial Information Congress (UNWGIC) in Hyderabad, PM Modi
says in India, technology is a tool for inclusion and not exclusion.
About:
 What:
→ Data / information about objects, events, or phenomena that have location on earth‘s surface. Location may be:
 static - road, earthquake event
 dynamic - moving vehicle, moving pedestrian, spread of infectious disease.
→ Geographic data and information / geospatial data and information / Georeferenced data and information / Geodata
and geoinformation is defined as data and information having an implicit or explicit association with a location
relative to Earth (a geographic location or geographic position).
 Component:
→ Geospatial data consist:
 location information
 attribute / characteristic information
 time etc.
 Application:
→ information of public interest - roads, localities, rail lines, water bodies, public amenities etc.
→ Daily life:
 food delivery apps – Zomato etc.
 e-commerce – Amazon etc.
 weather apps.
 Geo-spatial technology:
→ What:
 Emerging technique to study real earth geographic information using Geographical Information System (GIS),
Remote Sensing (RS), other ground information from various devices and instruments. Geospatial technology
uses tools like GPS, GIS, Remote Sensing, etc. for geographic mapping and analysis.
→ Example:
 Global positioning systems [GPS]
 geographic information systems (GIS):
• GIS is one type of database containing geographic data (descriptions of phenomena for which location is
relevant) combined with software tools for managing, analyzing, and visualizing those data.
 Remote Sensing
 canopy reflectance
 light detection and ranging technologies (LiDARs)
 aerial photography
→ Usage:
 for geographic mapping and analysis
 These tools capture spatial information about objects, events, phenomena (indexed to their geographical
location on earth, geotag). Location data may be Static or Dynamic.
 Static location data include position of road, earthquake event, malnutrition among children in particular region.
 Dynamic location data include data related to moving vehicle or pedestrian, spread of infectious disease etc.
 This technology may be used to create intelligent maps to help identify spatial patterns in large volumes of data.
Page 476 of 719
  PM Gati Shakti Master Plan, Digital Ocean platform, etc. are being powered by geospatial technology. This tech
is also being used in schemes like SVAMITVA.
→ Significance:
 This technology facilitates decision making based on importance and priority of scarce resources.
 India’s geospatial economy:
→ India’s geospatial economy is expected to cross Rs. 63,100 crores by 2025 at a growth rate of 12.8%.
→ There is employment opportunities for youth as companies like Swiggy, Amazon use it to conduct their delivery
operations smoothly.
→ Make in India allows Indian companies to use NavIC in Apps.
→ Crisis management like in COVID Vaccination and flood control.
→ Land records management.
Value Addition:
 Geospatial Energy Map of India [2021]:
→ What:
 comprehensive Geographic Information System (GIS) Energy Map of India
 It shows spatial and non-spatial data of:
• conventional power plants (thermal, hydro)
• renewable energy power plants
• coal mines
• petroleum refineries
• solar energy resource potential
• wind energy resource potential
• other energy related assets of India.
 developed by NITI Aayog and ISRO.
 GIS map provides holistic picture of all energy resources of India.
→ Aim:
 to provide inputs for formulating and evaluating policies
 assisting Energy Ministries and Departments in policy formulation
 encourage private sector participation in energy sector.
→ Function:
 identify and locate all primary and secondary sources of energy
 their transportation / transmission networks
→ Features:
 unique effort aimed at integrating energy data scattered across multiple organizations and to present it in
consolidated, visually appealing graphical manner.
 It uses latest advancements in web-GIS technology and open-source software to make it interactive and user
friendly.
 It will be useful in planning and making investment decisions.
 It will also aid in disaster management using available energy assets.
→ Significance:
 GIS-mapping of energy assets will ensure real-time and integrated planning of energy sector of India [India has
large geographical distribution and interdependence]
 advantageous to all concerned stakeholders
 accelerating policy-making process.
Mains Link:
 Discuss the applications of geo- spatial data.

SUPPLY CHAIN
News:
 2020:
→ India and Australia have signed historic agreement - Mutual Logistics Support Agreement (MLSA), to allow access
to military bases for logistics support.
→ India and US signed last foundational agreement - Basic Exchange and Cooperation Agreement for Geo-Spatial
Cooperation (BECA).
 2021:
→ India to conclude bilateral logistics agreement with Russia - Reciprocal Exchange of Logistics Agreement (RELOS).
India and UK agreement is in final stages of conclusion.
→ Japan, India & Australia formally launches Supply Chain Resilience Initiative (SCRI).
 2022:
→ Union Minister of Commerce and Industry Shri Piyush Goyal talks about local supply chains at WEF Davos meet
(2022), in Switzerland. He says Indian industry should strengthen domestic supply chains by sourcing supplies locally
Page 477 of 719
 and we should not excessively depend on international supply chains and should ask businesses to procure goods
locally “whenever there’s opportunity”.
→ PM Modi is set to lay foundation stone for Multi-Modal Logistics Park in Chennai.
→ GOI extends concession period for multi-modal logistics parks (MMLPs) scheme from 30 to 45 years, to attract more
long-term investment into India’s infrastructure.
→ Partnership of 18 economies, including India, US, EU unveiled one 4-point roadmap for building collective, long-term
resilient supply chains, including steps to counter risks arising from supply dependencies and vulnerabilities.
→ National Highways Logistics Management Limited (NHLML) (one SPV of NHAI), Inland Waterways Authority of India
(IWAI) and Rail Vikas Nigam Limited (RVNL) (one wholly owned PSU under Ministry of Railways) sign one tripartite
agreement for swift development of modern Multi Modal Logistics Parks (MMLP) under Bharatmala Pariyojana
across India with objective to centralize freight consolidation and reduce logistics cost from 14% to less than 10% of
GDP at par with International Standards; to ensure that cargo is swapped / shifted from and to Waterways, Dedicated
Freight Corridors & Road Transport; to ensure swift, efficient, economical and environmentally friendly logistics
movement; and to empower and energise economies of scale via PM Gati Shakti.
→ To clear trade bottlenecks, PM unveils National Logistics Policy (2022): PM Modi (GOI) unveils National Logistics
Policy and set goal to trim India’s logistics costs from as much as 13-14% of GDP to single digit over next few years.
National Logistics Policy aims to ensure seamless movement of goods and services across India and cut elevated
logistics costs, often considered biggest structural bottleneck for both external and internal trade in India.
→ Ministry of Commerce and Industry releases report - Logistics Ease Across Different States 2022 / LEADS 2022. [Assam
is among the 15 States and UTs categorised as achievers in the logistics index chart 2022. The index is an indicator of
the efficiency of logistical services necessary for promoting exports and economic growth].
→ Minister for Commerce and Industry Shri Piyush Goyal says PM GatiShakti National Master Plan has the potential to
save over Rs. 10 Lakh Crore annually by improving logistics efficiency.
About:
 What:
→ In commerce, supply chain refers to network of organizations, people, activities, information, and resources involved
in delivering product or service to consumer. Supply chain activities involve transformation of natural resources, raw
materials, and components into finished product and delivering same to end customer. In sophisticated supply chain
systems, used products may re-enter supply chain at any point where residual value is recyclable. Supply chains link
value chains. Suppliers in supply chain are often ranked by "tier", with 1 st-tier suppliers supplying directly to client,
2nd-tier suppliers supplying to 1st tier, and so on.
 Local supply chain:
→ What:
 Local supply chain implies having regional suppliers and manufacturers in area very close to one’s main location
say in India in case of India. During coronavirus, small businesses were hit hard with economic impact and being
cut off from their foreign suppliers.
 Logistics:
→ What:
 Logistics is generally detailed organization and implementation of complex operation. In general business sense,
logistics is management of flow of things between point of origin and point of consumption to meet
requirements of customers or corporations. Resources managed in logistics may include tangible goods such as
materials, equipment, supplies, food and other consumable items. In India, logistics sector is accorded
“infrastructure” status in 2017, facilitating availability of debt on easier terms and access to External Commercial
Borrowings (ECB). India’s logistics costs are at 14% (world average 7-8%). As per World Bank’s 2018 Logistics
Performance Index, India ranks 44 out of 160 countries.
Logistics is the management of the flow of things between the point of origin and the point of
consumption to meet the requirements of customers or corporations. It is the overall process of managing how
resources are acquired, stored and transported to a final destination.
→ Elements of Indian Logistic Sector:
 High-Tech industry. Increasingly shifted to centre of value creation. Physical geography matters less with fall in
transportation costs. Economic geography matters more with economies of scale in production. Price of speed
has fallen dramatically, with decline in air transport costs. Value of trade is growing much faster than its weight.
Containerization has redefined whole transport business.
→ Multi-Modal Logistics Parks (MMLP) in India:
 What:
• MMLP is officially defined as freight-handling facility with minimum area of 100 acres, with various modes
of transport access, mechanized warehouses, specialized storage solutions such as cold storage, facilities
for mechanized material handling and inter-modal transfer container terminals, and bulk and break-bulk
cargo terminals. It is one key policy initiative of Government of India, led by National Highways Logistics
Management Limited under Ministry of Road Transport and Highways (MoRTH) and National Highways
Authority of India (NHAI), to develop Multi-Modal Logistics Parks in hub-and-spoke model.
 Objective:
Page 478 of 719
 • To improve India's freight logistics sector by lowering overall freight costs and time, cutting warehousing
costs, reducing vehicular pollution and congestion, improving tracking and traceability of consignments
through infrastructural, procedural, and information technology interventions.
 Need:
• Since, in 2017, India had comparatively high logistics costs, 13% of total price of goods compared with 8%
in other major economies and average 72% higher cost than China of exporting / importing container in
India. To make India globally competitive by reducing these costs and time, MoRTH is developing multi-
modal logistics parks at selected locations in India under its Logistics Efficiency Enhancement Program
(LEEP).
 Feature:
• Logistics parks will also provide value-added services such as customs clearance with bonded storage yards,
quarantine zones, testing facilities, and warehousing management services. Provisions will also be made for
late-stage manufacturing activities such as kitting and final assembly, grading, sorting, labelling, and
packaging activities, re-working, and returns management.
 Functions:
• MMLPs serve below key functions: Freight aggregation and distribution; Multimodal freight transport,
integrated storage, and warehousing; Information technology support; Value-added services.
 Status:
• India’s 1st MMLP is at Jogighopa in Assam. As of 2021, 35 MMLPs are identified by MoRTH. Among those
Bangalore, Chennai, Guwahati, and Nagpur are under implementation, and rest are in pre-planning and
Detailed Project Report (DPR) is yet to be prepared. GOI has planned to build 35 such mega freight-and-
transport hubs under its flagship Bharatmala scheme, aiming to smoothen freight mobility, improve
efficiency and reduce logistics costs.
 Significance:
• Development of MMLPs at strategic locations is envisaged as key policy measure to rationalize cost of
logistics in India and improve its competitiveness.
→ Logistics Agreement:
 What:
• administrative arrangements facilitating access to military facilities for exchange of fuel and provisions.
administrative framework through which partnering countries can enjoy ease of access to use each other’s
military facilities - ports, bases, military installations. On reciprocal basis, it facilitates replenishment of fuel,
rations, spare parts, berthing, maintenance for each other’s warships, military aircraft, troops during port
visits and joint exercises.
 Significance:
• Saves enormous time. frees up need for constant paperwork when one military obtains assistance on
matters like refueling, berthing, use of aviation infrastructure, etc. simplifies logistical support. increases
operational turnaround of military when operating away. Navy’s operational turnaround has increased.
Navy’s inter-operability on high seas has increased.
 India: India signed logistic agreements with below countries:
• USA:
 General Security of Military Information Agreement (GSOMIA):
o promoting interoperability. foundation for future US arms sales to India. Also signed - Industrial
Security Annex (ISA) (one extension to GSOMIA).
 Logistics Exchange Memorandum of Agreement (LEMOA):
o India-specific version of LSA. India signed it in 2016. gives access, to both countries, to designated
military facilities on either side for refuelling and replenishment. will not involve stationing of US
troops on Indian soil. Nor will India extend support if US goes to war with friendly country. good
for US forces’ re-balancing in Asia-Pacific. Indian forces rarely operate beyond its shores but access
to Djibouti & Diego Garcia could be useful.
 Communications Compatibility and Security Agreement (COMCASA):
o India-specific version of CISMOA. USA to supply India its proprietary encrypted communications
equipment and systems, allowing secured peacetime and wartime communications between high-
level military leaders of both sides. enables seamless communication with USA about Indian
aircraft and ships, having US-made equipment. Concern: India fears that US would be able to track
and snoop on Indian warships / aircrafts etc.
 Basic Exchange and Cooperation Agreement for Geo-Spatial Cooperation (BECA):
o allows India to use US expertise on geospatial intelligence. enhance military accuracy of automated
hardware systems and weapons like cruise, ballistic missiles, drones.
o Concern: USA says BECA will help India with advanced satellite and topographical data. But, India
has its own satallites and thus unwilling for US sensors to be positioned on Indian soil.
Note: But these agreements do not obligate both countries to provide / service particular requirement.
• France; South Korea; Japan; Singapore;
Page 479 of 719
 • Australia:
 Mutual Logistics Support Agreement (MLSA):
o What: reciprocal access to military logistics facilities (food, water, fuel, spare parts, etc). useful
during joint military exercises, peacekeeping operations, Humanitarian Assistance and Disaster
Relief (HADR) operations, deployments of military platforms, any other demanding situations.
improving interoperability between security forces of India and Australia.
o Significance: Important in light of India and Australia’s limited naval capabilities. scarcity of
resources puts limitations on any country’s ability to project power in distant waters, leaving its
far-off assets at mercy of other actors. China factor.
→ Initiative:
 National Logistics Policy (2022).
→ Status:
 As per World Bank’s 2018 Logistics Performance Index, India ranks 44 out of 160 countries.
 According to Dept. of Commerce, Min. of Commerce’s Logistics Ease Across Different States (LEADS) 2021 index,
Gujarat tops in logistics in India.
→ Benefit of good logistics:
 Improves trade competitiveness. ease of doing business. economic growth.
 Resilient supply chain:
→ Resilient supply chain means having capability to resist or even avoid impact of supply chain disruption – and ability
to quickly recover from disruption.
→ Method: Multisourcing; Nearshoring; Platform, product or plant harmonization; ecosystem partnerships; Inventory
and capacity buffers; manufacturing network diversification.
 Threats:
→ Geopolitics (e.g. domination of China on global supply chain), Wars (e.g. Russian oil to EU), Pandemic, Extreme
climate events (e.g. heatwaves), Natural Disasters.
 Initiatives:
→ Supply Chain Resilience Initiative (SCRI) (by India, Japan, Australia) to counter China’s dominance in Indo-pacific.
→ List of government schemes launched to develop and encourage entrepreneurship in India and promote local
business:
 AtmaNirbhar Bharat; SAMRIDH Scheme; Startup India Seed Fund; Startup India Initiative; Startup Leadership
Program; ASPIRE; Pradhan Mantri Mudra Yojana (PMMY); Qualcomm Semiconductor Mentorship Program
(QSMP); Ministry of Skill Development and Entrepreneurship; ATAL Innovation Mission; eBiz Portal; Stand Up
India Scheme.
→ National Logistics Policy (2022).
→ Logistics Division in Dept. of Commerce has been created.
→ PM Gati Shakti Scheme.
→ Bharatmala Project (building about 84,000 km of new highways).
→ Sagarmala Project (unlock potential of India’s 7,500 km coastline, and 14,500 km of navigable waterways).
→ Railways Freight corridors.
Note:
 Foundational Agreements of USA:
→ General Security of Military Information Agreement (GSOMIA):
 protect any shared classified information / technology
→ Logistics Support Agreement (LSA):
 logistic support – refueling, berthing facilities for each other’s warships, aircrafts.
→ Communications and Information Security Memorandum of Agreement (CISMOA):
 technology enabler. help transfer high-tech avionics, encrypted communication & electronic systems. boost
interoperability and secrecy.
→ Basic Exchange and Cooperation Agreement for Geo Spatial Intelligence (BECA):
 exchange of geospatial information for both military and civilian use. targeting and navigation information from
US systems. More accurate GPS. Missiles navigation etc.
 Supply Chain Resilience Initiative (SCRI) [2021]:
→ What:
 Initiative of Japan, India, Australia so as to make supply chain resilient in Indo-Pacific region.
→ Why:
 To counter China’s dominance of supply chain in Indo-Pacific region
→ Aim:
 Attain strong, sustainable, balanced and inclusive growth in Indo-pacific region.
→ Measures:
 practices on supply chain resilience. diversification of supply chains. utilization of digital technology.
diversification of trade and investment.
Page 480 of 719
 → Significance:
 To reduce dependency on China (important amid Covid-19 pandemic, growing tension in Indo-pacific, south
China sea). To build upon existing bilateral frameworks like: ASEAN-Japan Economic Resilience Action Plan; and
Indo-Japan Industrial Competitiveness Partnership. To attract FDI.
 RELOS agreement [yet to be signed]:
→ What:
 Reciprocal Exchange of Logistics Agreement. military cooperation between India and Russia.
→ Aim:
 Interoperability. sharing of logistics.
→ Feature:
 It would grant access to Russian naval port facilities in Arctic. Russian naval ships, aircraft can access Indian ports,
bases.
→ Significance:
 important step forward in military sphere. Observer Research Foundation (ORF) (based in Delhi) says RELOS will
help India expand its military reach, especially maritime outreach and influence in various regions strategically
important to India. Of 3 services, Indian Navy (most outgoing force) will be mostly benefited via enhanced
operational turnaround, interoperability on high seas by relying on infrastructure, assistance of partner
countries. India is looking to set up Arctic station. India and Russia are exploring enhanced energy cooperation
in Arctic region. India’s presence in Arctic region will act as strategic counterweight to China’s strategic behavior
with China and Russia sharing synergy in Arctic.
 Logistics Performance Index:
→ What:
 LPI is one interactive benchmarking tool created by World Bank to help countries identify challenges
and opportunities they face in their performance on trade logistics and what they can do to improve
their performance. Biennial.
→ Feature:
 LPI is weighted average of country scores on 6 key dimensions: customs performance, infrastructure
quality, ease of arranging shipments, logistics services quality, consignments tracking and tracing,
timeliness of shipments. This measure indicates relative ease and efficiency with which products can
be moved into and inside country.
→ Logistics Performance Index 2018:
 Germany, Sweden - most efficient and highest ranked LPI countries. As per this World Bank’s 2018
Logistics Performance Index, India ranks 44 out of 160 countries.
 National Logistics Policy (2022):
→ What:
 To clear trade bottlenecks, in 2022 PM unveiled National Logistics Policy (2022). NLP 2022 sets goal to trim
India’s logistics costs from as much as 13-14% of GDP to single digit over next few years. NLP aims to ensure
seamless movement of goods and services across India and cut elevated logistics costs, often considered biggest
structural bottleneck for both external and internal trade in India. It aims of promoting seamless movement of
goods and enhancing competitiveness of logistics industry.
→ Origin:
 NLP was announced in Budget 2022-23.
→ Need:
 Logistics cost in India (about 13-14% of GDP) is high as compared to other developed economies (8%). India’s
logistics sector is highly defragmented and very complex. This sector provides employment to more than 22
million people and is expected to grow at rate of 10.5% over next 5 years. Logistics is also backbone of India’s
international trade and will help in diversification of not only India’s export basket but also of products and
countries.
→ Objective:
 Reducing costs for logistics sector to 10% in 5 years. Develop skills among youth and create employment
opportunities. Promote seamless movement of goods and enhance competitiveness of industry across India.
Focus on some key areas like process re-engineering, digitization, multi-modal transport.
→ Feature:
 This new logistics policy has 4 critical features:
• Integration of Digital System (IDS): Under IDS, 30 different systems /data of 7 departments (such as road
transport, railways, customs, aviation, commerce departments) are integrated.
• Unified Logistics Interface Platform (ULIP): ULIP will lead to improving shorter and smooth cargo movement.
It will also enable information exchange on real-time basis in confidential manner. [ULIP was created with
help from National Industrial Corridor Development Corporation Ltd.].
• Ease of Logistics (ELOG): ELOG will simplify rules and ease logistics business.

Page 481 of 719

 • System Improvement Group (SIG): SIG will monitor all logistics-related projects regularly and try to tackle
all obstacles.
Mains Link:
 A push towards logistics, prioritizing government measures to reduce India’s extremely high logistics costs, plethora of
regulations, poor connectivity and distribution challenges is the current need of the hour. Elucidate. (15M)

FINANCIAL INCLUSION
News:
 2021:
→ RBI unveils Financial Inclusion Index.
 2022:
→ Finance ministry data reveals that deposits in bank accounts opened under Pradhan Mantri Jan -Dhan Yojana
(PMJDY) crossed Rs 1.5 lakh crore.
→ Finance Minister Nirmala Sitharaman reiterates her Budget announcement on setting up 75 digital banking
units in 75 districts of India in 2022. [This is to take forward government’s agenda of digital financial
inclusion.
→ Wb releases Global Findex Database 2021.
→ One article in new written by David Malpass (President of World Bank Group) on financial inclusion.
→ NITI Aayog calls for setting up Digital Banks (DB).
→ PMJDY completes 8 years of successful implementation.
→ PM Modi dedicates 75 digital banking units to India, taking forward an announcement that was made in
the 2022-23 Union Budget by FM Nirmala Sitharaman. Speaking virtually at the event, PM Modi said that
the digital banking units will “further financial inclusion” and “significantly improve banking experience
for the citizens”. [In the Budget 2022-23, the FM Sitharaman had announced 75 DBUs to mark 75 years of
Indian independence].
About:
 What:
→ WB defines Financial Inclusion as means that individuals and businesses have access to useful and
affordable financial products and services that meet their needs – transactions, payments, savings, credit
and insurance – delivered in responsible and sustainable way.
→ Financial inclusion refers to efforts to make financial products and services accessib le and affordable to
all individuals and businesses, regardless of their personal net worth or company size. Financial inclusion
strives to remove barriers that exclude people from participating in financial sector and using these
services to improve their lives. It is also called inclusive finance.
→ Financial inclusion is defined as availability and equality of opportunities to access financial services. It
refers to process by which individuals and businesses can access appropriate, affordable, and timely
financial products and services. These include banking, loan, equity, and insurance products. Financial
inclusion efforts typically target those who are unbanked and underbanked, and directs sustainable
financial services to them. Financial inclusion is un derstood to go beyond merely opening bank account. It
is possible for banked individuals to be excluded from financial services. Having more inclusive financial
systems has been linked to stronger and more sustainable economic growth and development and th us
achieving financial inclusion has become priority for many countries across globe.
 Benefits:
→ Easier, cheaper, and safer for people to receive wages from employers, and send remittances to family members.
→ Mobile money accounts can better handle high-volume, small-denomination transactions.
→ Women empowerment: Individual accounts also give women more privacy, security, and control over their money.
→ Reduce leakage and delay in government transfers: It benefits directly people through their Aadhaar seeded bank
accounts. For example – MGNREGA has been attached to Jan Dhan-Aadhaar-Mobile (JAM) platform, which aims to
prevent leakages and delays and is right step in this direction.
→ Government of Andhra Pradesh launched one smart-card program for MGNREGS and social security pensions where
payments were delivered to bank accounts linked with biometric smart cards has resulted in faster, less corrupt
payment process.
→ It enhances financial resilience (ability to deal with unexpected financial event): Financial access facilitates day-to-
day living and helps families and businesses plan for everything from long-term goals to unexpected emergencies.
→ Against corruption: It helps to increase transparency as money flows from government’s budget to public agencies
to citizens.
 Digital Banking:
→ What:
 Digital banking is part of broader context for move to online banking, where banking services are
delivered over internet. Shift from traditional banking to digital banking is gradual and remains
ongoing, and is constituted by differing degrees of banking service digitization. Digital Banking means

Page 482 of 719

 banking done through digital platform, doing away with all paperwork like cheques, pay -in slips,
Demand Drafts,etc.
→ Feature:
 Digital banking involves high levels of process automation and web -based services and may include
Application Programming Interfaces (API) enabling cross -institutional service composition to deliver
banking products and provide transactions.
 It provides ability for users to access financial data through desktop, mobile, ATM services.
→ Digital Banking Unit (DBU):
 What:
• It is specialised fixed point business unit or hub housing certain minimum digital infrastructure for delivering
digital banking products and services as well as servicing existing financial products and services digitally in
self-service mode at any time such as ATM, access to internet banking, digital account opening etc. Simply
put, digital banking involves taking all traditional banking activity online — doing away with paperwork like
cheques, pay-in slips, demand drafts and so on. DBU is joint initiative of RBI, Indian Banks’ Association and
participating banks.
 Need:
• Given rapid rise of digital banking, digital payments, FinTech innovation, it is critical to develop digital
infrastructure to support digital banking, which has enormous potential.
 Feature:
• Totally paperless.
• Hassle free account opening through eKYC / Video KYC.
• 24 x 7 cash deposit and withdrawal.
• RBI allows commercial banks (other than RRBs, payment banks, local area banks) with past digital banking
experience are permitted to open DBUs.
• As per RBI, DBUs will be treated as banking outlets.
• Services provided by DBUs:
 As per RBI, each DBU must offer certain minimum digital banking products and services. Such products
should be on both liabilities and assets side of balance sheet of digital banking segment.
 Services include savings bank accounts under various schemes, current accounts, fixed deposits,
recurring deposit accounts, digital kit for customers, mobile banking, Internet banking, debit cards,
credit cards, mass transit system cards etc.
 Benefit:
• Neo-banks / digital banks excel at product innovation and offer far better digital solutions, compared to
conventional banks. It will further provide 24X7 banking, paperless banking and ensure digital literacy.
• DBU will help banks themselves which are now looking to reduce physical footprint with fewer brick and
mortar branches, with ‘light’ banking approach.
• It will open up rural market for service providers
• It will help in providing boost to credit flow in rural market for banking service.
• It will be cheaper to establish than new branch, and can provide better customer experience aided by
technology.
• It may be branded as new-age banks that can help provide personalised finance management tools to new
consumers.
• Digi banking units require lesser staff, with cheaper maintenance due to technological tools and hence can
be high-yield units for parent bank.
• It can encourage more financial literacy and favourable outlook towards digital banking – which is need of
hour.
 RBI Guidelines for DBUs:
• Permission to open DBUs is given to scheduled commercial banks (SCB) that have past digital banking
experience.
• SCB can open DBUs in Tier 1 to Tier 6 centres without taking permission from RBI.
• DBUs opened by SCBs will be treated as Banking Outlets.
• Each DBU must be housed distinctly, with separate provisions for exit and entry.
• DBUs must be separate from existing Banking Outlet with proper formats provided appropriately for digital
banking users.
• Each DBU must be headed by senior and experienced executive of that SCB bank who can be designated as
DBU’s Chief Operating Officer (COO).
 Concern:
• Only 27% of our population is digitally literate, with a lack of good connectivity infrastructure. Also, they
lack independent existence and are in a partnership with NBFCs and scheduled banks.
 Significance:
• DBUs will also act as digital financial literacy centres.
Page 483 of 719
  Initiative:
→ Pradhan Mantri Jan Dhan Yojana; Digital Bank; India Stack; Aadhaar; UPI; extending microcredit facilities to street
vendors through PM-SVANIDHI; ‘open banking’ through Account Aggregator (AA) regulatory framework.
 Case studies:
→ Successful example – Kenya’s M-Pesa, allows users with or without bank accounts to transfer and make payments
through basic mobile phone is one example of digital financial inclusion success story which now accounts for 20%
of Kenya’s GDP and improved per capita consumption and lifted 2% of Kenyan households out of poverty.
 Significance:
→ WB considers Financial Inclusion as one enabler for 7 of 17 SDGs.
→ WB Group considers financial inclusion key enabler to reduce extreme poverty and boost shared
prosperity.
 Way Forward:
→ Broader inclusion; Customer-centered product innovation; Financial capability; Strong consumer protection; Better
financial infrastructure; More & interoperable access points; Enabling legal & regulatory frameworks; Public & private
sector commitment; Open & balanced playing field.
→ Suggestions given by David Malpass (President of World Bank Group) in 2022:
 Create favourable operating and policy environment: E.g. enable interoperability of systems (e.g. UPI), access to
mobile-phone system for banking, Consumer protections and stable regulations.
 Establishing digital-identification systems: Eg. Aadhar in India.
 Promote digitalization of payments: This will also promote formal-sector employment without making
compliance excessively burdensome.
 Inclusion: Gender gap in financial access has narrowed, but it still exists. Women, along with poor, are more
likely to lack form of personal identification or mobile phone, to live far from bank branch, and to need support
to open and use financial account.
→ David Malpass (President of World Bank Group) says expanding people’s access to finance, reducing cost of digital
transactions, and channeling wage payments and social transfers through financial accounts will be vital to mitigating
development setbacks resulting from ongoing turbulence.
Note:
 Jan Dhan Yojana / National Mission for Financial Inclusion [2014]:
→ What:
 National Mission for Financial Inclusion to ensure access to financial services, namely: Banking, savings,
deposits, remittance, credit, insurance, pension in affordable manner. It is one central sector scheme
under Min. of Finance.
→ Objectives:
 To ensure access of financial products & services at affordable cost.
 Use of technology to lower cost & widen reach.
→ Feature:
 Banking unbanked: Opening of basic savings bank deposit (BSBD) account with minimal paperwork,
relaxed KYC, e-KYC, account opening in camp mode, zero balance, zero charges.
 Securing unsecured: Issuance of Indigenous Debit cards, with free accident insurance coverage.
 Funding unfunded: Other financial products - micro-insurance, overdraft for consumption, micro-pension,
micro-credit.
 Focus shift from Every Household to Every Unbanked Adult.
→ Phase I (Pillars):
 Universal access to banking services for all households:
 Overdraft facility (OD): Basic savings bank accounts with overdraft facility (OD) to every household.
 Financial Literacy Program: At village level, promoting savings, use of ATMs, getting ready for credit,
availing insurance, availing pensions, using basic mobile phones for banking.
 Expansion of DBT to PMJDY accounts.
 Insurance: RuPay debit card with Rs. 1 lakh accident insurance.
 RuPay Kisan Card.
→ Phase II:
 Credit Guarantee Fund for Coverage of Defaults in Overdraft Accounts.
 Micro insurance to all
 Pension scheme for unorganised sector (like Swavlamban) through Business Correspondents.
→ Significance:
 Households are targeted as unit instead of villages.
 Both rural and urban areas are covered.
 Emphasis on Digital Financial Inclusion.
→ Performance:
 No. of total PMJDY accounts >44 crore.
Page 484 of 719
  Around 50 crore Jan Dhan accounts are in rural, semi-urban bank branches.
 Around 20 crore account holders are women.
 Benefits like scholarships, subsidies, pensions, COVID relief funds are credited to bank accounts, including
Jan Dhan Accounts, through DBT.
 As of 2022, more than 46 Cr beneficiaries banked i.e. increased financial inclusion; more than 67% of
PMJDY account in rural and semi-urban areas i.e. increased financial penetration; 56% account holders
are women i.e. increased women empowerment; benefits like scholarships, subsidies, pensions, COVID
relief funds are credited to bank accounts i.e. increased DBT.
 Financial Inclusion Index (FI-Index) [2021]:
→ Released by RBI to capture extent of financial inclusion in India.
→ It will be annually.
→ Components: details of banking; details of investments; details of insurance; details of postal; details of
pension sector.
→ 0 – 100 [0 represents complete financial exclusion, 100 indicates complete financial inclusion]
→ Parameters: Access, Usage, Quality.
→ no base year.
 Global Findex Database [2011]:
→ Released by WB.
→ Financial inclusion is one cornerstone of development, and since 2011, Global Findex Database has been definitive
source of data on global access to financial services from payments to savings and borrowing.
→ Global Findex Database 2021:
 2021 edition, based on nationally representative surveys of over 125,000 adults in 123 economies during COVID-
19 pandemic, contains updated indicators on access to and use of formal and informal financial services and
digital payments eg., cards, ATMs, mobile phones, internet, and offers insights into behaviors that enable
financial resilience. These data also identify gaps in access to and usage of financial services by women and poor
adults.
 Global specific findings:
• Account ownership: Globally, in 2021, 76% of adults had account at bank or regulated institution such as
credit union, microfinance institution, or mobile money service provider.
• Women empowerment: Mobile money has become important enabler of financial inclusion — especially
for women e.g., in Sub-Saharan Africa.
• High financial stress: Despite promising growth in account ownership and use, about 1/2th of adults in
developing economies are worried about at least one area of financial stress e.g., emergency fund for
health.
• Low financial literacy: About 2/3rd of unbanked adults said that if they opened account (excluding mobile
money) at financial institution, they could not use it without help.
 India-specific findings:
• Low access to formal banking in India and there is lack of trust.
• Aadhar contributed to account ownership in about 80% of adults.
• Drop-in fraud and leakage: Transitioning from cash to biometric smart cards has reduced leakage by 47% in
pension payments.
Glossary:
 Neo bank:
→ “Neo” means new. These are new-age banks without any physical location, and present entirely online. They provide
digital, mobile-1st financial solutions for payments, money transfers, lending, and more.
Question:
 Facility / facilities beneficiaries can get from services of Business Correspondent (Bank Saathi) in branchless areas are:
→ It enables beneficiaries to draw their subsidies and social security benefits in their villages.
→ It enables beneficiaries in rural areas to make deposits and withdrawals.
Mains Link:
 Financial inclusion is increasingly being recognized as a key driver of economic growth and poverty alleviation the world
over. Discuss the efforts being made by India in this direction. (250 Words)
 The establishment of ‘Payment Banks’ is being allowed in India to promote financial inclusion. Which of the following
statements is/are correct in this context? (UPSC CSE 2016)
 India still has a long way to go to bridge the gender gap in access and use of financial services. Comment (250 Words)

INTELLECTUAL PROPERTY (IP)

News:
 2020:
→ Intellectual Property Appellate Board (IPAB) rejects plea from Red Bull, manufacturer of energy drink, for removal of
one trademark registered in name of Dr. Reddy’s Laboratories Limited.

Page 485 of 719

 → Black rice of Manipur (Chak-Hao).
→ India moves EU for GI tag for Basmati rice.
 Basmati Rice: India is world’s largest exporter of basmati rice. India, Pakistan – only exporters of basmati rice in
world.
→ Pakistan files case in EU against India's move to get Basmati rice registered as its product in EU.
→ India asks WTO to waive certain conditions of Trade Related Aspects of Intellectual Property Rights (TRIPS)
Agreement, 1995 that could delay / prevent timely access to affordable medicines to combat COVID-19.
→ Co-authored by India and South Africa, one proposal is taken up at WTO negotiations, to “temporarily waive”
intellectual property rights (IPR) held, by primarily Western countries, on vaccines, therapeutics, diagnostics for
Covid-19.
→ CPI(M) ask central government to issue compulsory licences for manufacturing affordable generic version
of Remdesivir.
 Need for:
• Gilead Sciences’ anti-viral drug Remdesivir has shown efficacy in treating COVID-19 patients.
• USA has book entire stock of Remdesivir from Gilead.
• Thus, it will not be available for rest of world.
• Besides, Gilead, by virtue of its patent monopoly, is asking world to pay high cost.
→ This above mentioned temporary IPR waiver proposal at WTO gets updated, with representation from many low–
and middle–income countries — with omission of China — to expand scope of waiver to “all health products and
technologies”.
 2021:
→ Covid-19 drug – Remdesivir’s patent issue i.e. alleged patent violations between USA and Russia because of which
Russia may not send Remdesivir to India.
→ Saying extraordinary circumstances need extraordinary measures, USA announces support for waiving intellectual
property protection for COVID-19 vaccines. US will pursue “text-based negotiations” on said IP waiver at WTO.
 Text-based negotiation:
• Exchange of texts among negotiators with their preferred wording and then reaching consensus.
• long-drawn affair.
 Significance / Implications:
• IP waiver for COVID-19 vaccines may ramp up production of COVID vaccines with emergency use
authorisations (EUA) — such as COVID vaccines developed by Pfizer, Moderna, AstraZeneca, Novavax,
Johnson & Johnson , Bharat Biotech, on larger scale in middle-income countries.
• Most production is currently concentrated in high-income countries; production by middle-income
countries has been happening through licensing or technology transfer agreements.
→ South Africa, 1st time in world, granted patent to one AI system (DABUS [Device for Autonomous Bootstrapping of
Unified Sentience]).
 Issue:
• Patent given to AI system and not human being.
• Ideas, for purposes of patents, require element of “mental conception” — something of which only human
mind is capable and not AI.
• Inventorship comes with rights, which AI is not legally capable of possessing.
→ WIPO releases Global Innovation Index 2021 rankings. India climbs two spots. Switzerland tops.
→ One company files application seeking Geographical Indication (GI) tag for Arunachal Pradesh Apatani
textile product.
 2022:
→ India runs risk of being excluded from 2020 temporary IPR waiver proposal at WTO, which was co-authored by India
and South Africa.
 Issue:
• Small group of WTO members are discussing suggestions to exclude drug manufacturers in India and China
— two major, global suppliers of medicine — from expected waivers to IPR obligations that result from
TRIPS which WTO members are committed to uphold.
• Also, manufacturers want to “limit” any benefits of waiver only to African countries, and not pave way for
Indian manufacturers who, with their large production capacities, would easily compete with Western
competitors.
 What weakened India’s global campaign?
• Indian government failed to get Indian pharmaceutical industry on board. Many Indian pharmaceutical
bodies are not in favor of said waiver, thus hurting India’s global campaign.
• During entire Covid pandemic, India rarely made use of existing flexibilities under Indian Patents Act, 1970
like compulsory licences (CL), which are consistent with TRIPS agreement, to increase supply of Covid-19
medical products despite being encouraged by judiciary to do so.

Page 486 of 719

 • TRIPS waiver at WTO is only enabling framework. Member countries need to amend their domestic IP laws
to implement said waiver. Yet, India did not proactively develop national strategy to implement TRIPS
waiver as and when it was adopted. This would have fortified India’s position internationally and also would
have acted as pressure point to influence negotiations.
 Why low- and middle-countries want IPR waived for Covid-19 vaccines? / Impact if IPR is waived for Covid-19
vaccines:
• IP waiver might open up space for production of Covid vaccines with emergency use authorisations (EUA)
— such as those Covid vaccines developed by Pfizer, Moderna, AstraZeneca, Novavax, Johnson & Johnson,
Bharat Biotech — on larger scale in middle-income countries. [Most production is currently concentrated in
high-income countries; production by middle-income countries has been happening through licensing or
technology transfer agreements].
 Arguments against waiver:
• Waiving of IPR will neither lead to increased production of vaccines nor lead to practical solutions to fight
Covid virus because IP is not barrier.
• Waiving of IPR could impact patient safety by opening doors for counterfeit vaccines to enter supply chain.
 Way Forward:
• Our top most priority should be to address supply side constraints, including IP barriers, augment
manufacturing of vaccines, therapeutics, diagnostics, essential for treatment, prevention, control of Covid
pandemic.
→ In India, for 1st time in last 11 years, number of domestic patent filing surpasses number of international patent filing
at Indian patent office. This means of total patent applications filed, majority were filed by Indian applicants against
non-Indian applicants.
→ Group of NGOs write to PM Modi, urging him to “proactively engage” with draught proposal at WTO-TRIPS in Geneva
to waive intellectual property rights (IPR) governing COVID vaccines, drugs, and diagnostics, which are mostly
controlled by companies in West.
 Background: In 2020, at WTO’s TRIPS Council, India and South Africa proposed that WTO do away with certain
provisions of TRIPS Agreement for duration of Covid pandemic to facilitate access to technologies necessary for
production of vaccines and medicines.
→ EAC to PM (PMEAC) recommends period within which patent applications are open to challenge by public be
restricted to mere 6 months from date of its publication.
 Background: In 2005, lawmakers amended Indian patent law to ensure that Indian patent office did not grant
monopolies on old science or for compounds already in public domain. This prevented drug corporations from
indulging in “evergreening”, one common abusive patenting practice aimed at obtaining separate patent
monopolies relating to same medicine.
→ White Onion, grown in Alibag / Alibaug, Maharastra, gets GI tags. [Alibagh, MH is known for growing white onion
using traditional method and utilizing geo-climatic conditions for unique taste, flavour, shape.]
→ NIPAM achieves target of training 1 million students on IP awareness. 3662 Educational Institutions in 28 States and
7 UTs covered.
→ At Valedictory Session of National Intellectual Property Conference 2022, Union Minister Shri Piyush Goyal
addressing on 'Strengthening IP Ecosystem for catalysing the growth of Knowledge Economy' expresses his desire to
have open house dialogue with the IP Fraternity by the office of Controller General of Patents, Designs and Trade
Marks (CGPDTM) and address their concerns, grievances and facilitate the discussion on the changes required into
the IP Ecosystem.
About:
 What:
→ Intellectual property (IP) is category of property that includes intangible creations of human intellect, primarily:
Copyrights, patents, trademarks.
→ IP also includes other types of rights trade secrets, publicity rights, moral rights, rights against unfair competition etc.
→ governed by TRIPS Agreement [1995] that allows countries to grant Compulsory License, though with some
conditions.
→ WIPO [1967] promotes and protects intellectual property (IP) across world.
→ In India, IP is governed by Patent Act, 1970.
→ IP refers to creations of the mind, such as inventions; literary and artistic works; designs; and symbols, names and
images.
 History:
→ In 17th and 18th centuries, modern concept of intellectual property (IP) developed in England.
→ In 19th century, term "intellectual property" began to be used.
→ In 20th century, intellectual property became common in majority of world's legal systems.
 Types (many types are there, some are given below):
→ Copyright:
 Copyright gives creator / inventor exclusive right to it, though usually for limited time.

Page 487 of 719

  Copyright may apply to wide range of creative; intellectual; or artistic forms / works.
 Copyright does not cover ideas and information themselves, copyright covers only form / manner in which ideas
/ information are expressed.
→ Patent:
 Right granted by government to inventor that gives owner / inventor right to exclude others from: making, using,
selling, importing said invention for limited period of time.
 powerful intellectual property right (IPR) i.e. exclusive monopoly granted by government to inventor for limited,
pre-specified time.
 It provides enforceable legal right to prevent others from copying said invention.
 Types:
• Process patent:
 Patent is granted for particular manufacturing process, and not for product itself.
 Any other person can produce that same product through some other process.
 Implication: There will be more than one producer for same product because of possibility of different
process for manufacturing that same product.
• Product patent:
 Exclusive right given to original inventor of product i.e. product is patented.
 no other manufacturer can provide that same product through same or any other process.
 Implication: There will be no competitor for that inventor / producer because it is product that is
patented.
 Process patent vs Product patent:
• Product patent system gives higher level of protection to inventor because there will be no other producer
of that product.
• WTO’s TRIPs, 1995 follows product patent system.
• Patent Act, 1970, India complies with WTO’s TRIPs, 1995 provisions and follows only product patents.
→ Trademark:
 Trademark is recognizable: sign; design; or expression which distinguishes products / services of particular trader
from similar products / services of other traders. That is, it is visual symbol - word signature, name, device, label,
numerals, combination of colours - used by one trader / enterprise on goods / services / articles of commerce -
to distinguish it from other similar goods / services originating from different trader / enterprise.
 In India, trademark is governed by Indian Trademarks Act, 1999
→ Trade secret etc:
 Trade secret is: formula, practice, process, design, instrument, pattern; or compilation of information which is
not generally known, by which business obtains advantage over competitors, customers.
 No formal government protection is granted but each business can take measures to guard its own trade secrets
 Example: Formula of Coca-Cola soft drinks is trade secret for Coca-Cola.
 Intellectual Property Rights (IPR):
→ Intellectual property rights (IPR) include:
 Patent
 Copyright
 industrial design right
 trademarks
 plant variety right
 trade dress
 Geographical indication (GI): Gi is one form of Intellectual Property Right (IPR). GI is governed by Agreement on
Trade-Related Aspects of Intellectual Property Rights (TRIPS), 1995 of WTO. In India, GI is governed by
Geographical Indications of Goods (Registration and Protection) Act, 1999.
 trade secret (in some jurisdictions).
 World Intellectual Property Organization (WIPO) [1967]:
→ What:
 among 15 specialized agencies of UN
 estd. by 1967 WIPO Convention.
 Geneva, Switzerland
 Parent org - UNESC
→ Aim:
 to promote and protect intellectual property (IP) across world, by cooperating with countries, international
organizations.
→ Member:
 <Most contries>, India, …
 India:
→ Patent system:
Page 488 of 719
  History:
• Before 1970s, India adopted product patenting.
• In 1970s, India changed to process patenting. It enabled India to become significant producer of generic
drugs at global scale. It allowed companies like Cipla, India to provide Africa with anti-HIV drugs in 1990s.
• But, due to obligations under TRIPS Agreement, 1995, India amended Patent Act, 1970 and switch to
product patents system.
 Patents Act, 1970, India:
• After expiration of 3 years from date of grant of patent, any person interested may file application to
Controller General of Patents, Designs and Trade Marks (Controller of Patents) requesting for grant of
compulsory licence on patent on below grounds:
 that reasonable requirements of public with respect to patented invention have not been met;
 that patented invention is not available to public at reasonably affordable price; or
 that patented invention is not used / available in territory of India.
• compulsory licenses can also be issued suo-motu by Controller of Patents as per Central government’s
notification in case of: national emergency; extreme urgency; public non-commercial use.
 Intellectual Property Appellate Board (IPAB) [2003]:
• What:
 constituted by Indian Government
 to hear and resolve appeals against decisions of Registrar under Indian Trademarks Act, 1999 and
Geographical Indications of Goods (Registration and Protection) Act, 1999.
 IPAB is authorized to hear and adjudicate appeals from most of decisions, orders, directions made by
Patent Controller under Patents Act, 1970.
• Organization:
 Each Bench of IPAB includes Judicial Member and Technical Member.
 qualifications for appointment as technical member are mentioned in Indian Trademarks Act, 1999 and
Patents Act, 1970.
→ Issue:
 India lacks strict enforcement; piracy is rampant; patent processing is cumbersome; lacks a grievance redressal
mechanism (after the Intellectual Property Appellate Board was abolished).
→ Status:
 India stands at 40th out of 130 countries in the Global Innovation Index 2022. GOI wants to bring it within the
rank 10 countries.
→ Initiative:
 National Intellectual Property Rights Policy / IPR Policy [2016]. Start-Ups Intellectual Property Protection (SIPP)
Scheme. Patent Facilitation Programme (PFP); KAPILA scheme (funds for colleges / universities for filing patents).
Note:
 National Intellectual Property Rights Policy / IPR Policy [2016]:
→ It gives institutional mechanism for implementation of IPR. CIPAM (Cell for IPR promotion and
Management) is implementation agency.
 Evergreening:
→ What:
 It is any of various legal, business, and technological strategies by which producers (often pharmaceutical
companies) extend lifetime of their patents that are about to expire in order to retain revenues from them.
Often this practice includes taking out new patents (for example over associated delivery systems or new
pharmaceutical mixtures), or by buying out or frustrating competitors, for longer periods of time than would
normally be permissible under law. Robin Feldman, one law professor at UC Hastings and leading researcher in
intellectual property and patents, defines evergreening as artificially extending life of patent or other exclusivity
by obtaining additional protections to extend monopoly period.
 It is one corporate, legal, business, and technological strategy for extending / elongating term of granted patent
in jurisdiction that is about to expire, in order to retain royalties from them, by taking out new patents.
→ India:
 In India, Patents Act, 1970 (amended in 2005) does not allow patents to be granted to inventions involving new
forms of known substance unless it differs significantly in properties with regard to efficacy. This means that
Indian Patents Act does not allow evergreening of patents.
 Geographical Indication (GI):
→ What:
 name / sign / status used on products that corresponds to specific geographical location / origin.
 GI tag is given primarily to: natural; agricultural; or manufactured product (handicraft, industrial) originating
from definite geographical territory.
→ Feature:
 form of Intellectual Property Right (IPR).

Page 489 of 719

  GI is governed by Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), 1994 of WTO, to
which India is party.
 Laws require that before applying for registration of any product in international market, it has to be protected
under geographical indication (GI) laws of that country.
 In India, GI is governed by Geographical Indications of Goods (Registration and Protection) Act, 1999.
→ Characteristic:
 assurance of quality; distinctiveness; place of origin.
→ Security / Benefit:
 Other producers can not misuse its name, to market similar products.
 authenticity of product
→ Registered proprietor (owner / holder) of GI:
 Association of persons, producers, organisation or legal authority.
 Register of Geographical Indication.
→ Validity:
 10 years. Renewal - 10 years each.
→ GI Authority:
 International level:
• covered as component of Intellectual Property Rights (IPR), under Paris Convention for Protection of
Industrial Property, 1883.
• also governed by WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), 1994.
 India:
• by Geographical Indications of Goods (Registration and Protection) Act, 1999. Darjeeling tea - 1st GI tagged
product in India.
→ Significance:
 Typically, GI tag conveys assurance of quality, distinctiveness, which is essentially attributable to place of its
origin.
 Creativity Machine:
→ Creativity machine can process and critically analyse data, learning from it.
→ Said process is known as machine learning.
→ Once machine learning is occurred, machine is able to autonomously create without human intervention.
 GI tag vs Trademark:
→
{GI Tag} {Trademark}
Conveys that product is produced in certain place
sign used by enterprise to distinguish its goods,
and has certain characteristics due to that place of
services from those of other enterprises.
production.
GI tag can be used by all producers who make their
right to exclude others from using that trademark
products, with shared distinct qualities, in that
place.
 Apatani weave:
→ made by Apatani tribe of Arunachal.
→ woven fabric
→ known for its geometric patterns, zigzag patterns, angular designs.
→ Apatani tribe predominantly weaves shawls, jackets.
→ Apatani tribe use leaves and plant resources for organic dyeing of cotton yarns in their traditional ways.
→ And only women folk are engaged in weaving.
 TRIPS Agreement [1995]:
→ Intro:
 WTO is governing body for international trade. One important agreement of WTO is TRIPS, which deals about
protection of Intellectual Property Rights (IPRs) across countries.
→ What:
 Agreement on Trade-Related Aspects of Intellectual Property Rights.
 international legal agreement between all member nations of WTO.
 It establishes minimum standards for regulation by national governments of different forms of intellectual
property (IP), as applied to nationals of other WTO member nations.
 TRIPS is administered by WTO.
→ Feature:
 It requires all its signatory countries to enact domestic laws.
 It guarantees minimum standards of IP protection. This legal consistency enables innovators to monetise their
intellectual property in many countries.

Page 490 of 719

  In 2001, WTO signed Doha Declaration, which clarified that in public health emergency, governments could
compel companies to license their patents to manufacturers, even if they did not think offered price was
acceptable. This provision, commonly referred to as “compulsory licensing”, was already built into TRIPS
Agreement and this 2001 Doha declaration only clarified its usage.
 It allows countries to grant Compulsory License, though with some conditions.
→ Minimum standards:
 TRIPS Agreement sets minimum standards in international rules governing patents – pharmaceuticals patent,
medicines patent etc.
 Member countries have to enact necessary legal framework by including TRIPS minimum regulations.
 TRIPS standards include: minimum patent period of 20 years; product patents; protection to pharmaceutical test
data from ‘unfair commercial use’; ….
 TRIPS Plus:
→ Background:
 Developed countries are not happy about TRIPS provisions.
 They demand higher protection to intellectual property rights (IPR) including inventions.
 These higher levels of protection norms are named as - TRIPS Plus.
 Developed countries own most of technologies and patents, and therefore they are using various international
forums to pressurize higher level of protection for intellectual property (IP).
 Over last few decades, developed countries are creating Free Trade Agreements (FTA) to give higher level of
protection to IPRs.
 Often these FTAs are outside WTO framework and hence they can give higher level of protection to IPRs there.
→ What:
 TRIPs Plus are higher level of protection norms demanded by developed countries that are not prescribed by
TRIPs regime of WTO.
 TRIPS Plus is not formally related to TRIPS.
 TRIPS Plus indicates that these requirements go beyond minimum standards imposed by TRIPS.
 Many developing countries who are members of FTAs are under pressure to enact these tougher conditions in
their domestic patent laws.
 Developing countries have concerns over higher level of protection demanded by developed world. Developing
countries fear that once such levels of protection are given, it will: reduce competition; and lead to price rise of
medicines, affecting health security in poor countries.
→ Example:
 One example for advanced norms under TRIPs Plus is protection demanded by developed countries for data
exclusivity.
 Data Exclusivity:
• Protection of clinical test data submitted to regulatory agency to prove safety, quality and efficacy of new
drug, and preventing generic drug manufacturers from relying on this data in their own applications.
• Data exclusivity will stop generic drug manufactures of developing countries from using these data while
applying for licenses.
• Demand for protecting exclusive data that have high commercial value is one major demand from
developed world which doesn’t usually come under TRIPS.
→ India’s stand on TRIPS Plus:
 India objects higher level of protection (TRIPS Plus) than provided by TRIPS.
 Concern: TRIPS Plus will restrict India’s generics drugs manufactures. TRIPS Plus will prevent Indian firms from
obtaining high technology at affordable prices. And thus, TRIPS Plus will reduce exports of India.
 India’s opposition to TRIPS Plus is reflected in FTA negotiation with Japan, EU who demand TRIPS Plus level of
protection in CEPA.
 National Intellectual Property Awareness Mission (NIPAM) [2021]:
→ Flagship program to impart IP awareness and basic training, launched as part of “Azadi Ka Amrit Mahotsav''
celebrations. This program is being implemented by Intellectual Property Office, Office of Controller
General of Patents, Designs and Trade Marks (CGPDTM), Ministry of Commerce and Industry. It imparts IP
awareness and basic training for students (class 8 to 12) to inculcate spirit of creativity and innovations.
 Compulsory License:
→ What:
 Compulsory license is generally defined as government’s authorization permitting 3rd party to: make; use; or
sell patented invention without consent of that concerned patent owner.
 Compulsory license provides that owner of patent or copyright licenses use of their rights against payment either
set by law or determined through some form of adjudication or arbitration. In essence, under compulsory
license, individual or company seeking to use another's intellectual property can do so without seeking rights
holder's consent, and pays rights holder set fee for that license. This is exception to general rule under

Page 491 of 719

 intellectual property laws that IP owner enjoys exclusive rights that it may license – or decline to license – to
others.
 CL is grant of permission by government to entities to use, manufacture, import or sell patented invention
without patent owner’s consent. In India, Patents Act, 1970 deals with CL.
 CL is permitted under WTO’s TRIPS (IPR) Agreement provided conditions such as ‘national emergencies, other
circumstances of extreme urgency and anti-competitive practices’ are fulfilled.
→ Governed by:
 TRIPS Agreement [1995]
 Patents Act, 1970 [India]:
• After expiration of 3 years from date of grant of patent, any person interested may file application to
Controller General of Patents, Designs and Trade Marks (Controller of Patents) requesting for grant of
compulsory licence on patent on below grounds:
 that reasonable requirements of public with respect to patented invention have not been met;
 that patented invention is not available to public at reasonably affordable price; or
 that patented invention is not used / available in territory of India.
• compulsory licenses can also be issued suo-motu by Controller of Patents as per Central government’s
notification in case of: national emergency; extreme urgency; public non-commercial use.
→ Issue:
 Compulsory licensing is hugely debated issue.
 Developing countries favour compulsory licensing because of unavailability and unaffordability of medicines.
 Developed countries - Europe, USA - are opposing compulsory licensing, saying it would discourage innovation
by pharmaceutical companies.
Mains Link:
 Evaluate the provisions of the Intellectual Property Rights (IPR) Policy in India. What are the challenges being faced by it?
Suggest measures needed to ensure transparency and enhance protection of the same.
 What is a Geographical Indication (GI) tag? Discuss it’s significance.
 Discuss the need for compulsory Licensing.
 Write a note on compulsory Licensing.

INDIAN RAILWAYS
News:
 2022:
→ Under India-Bangladesh Railways Contract, Bangladesh railways will procure 420 broad-gauge wagons from India.
This project is being implemented with joint funding of Government of Bangladesh and ADB under ADB’s Rolling
Stock Operation Improvement Project.
→ PM Modi would dedicate to nation 4 railway projects. They are:
 75 km long Madurai Theni (Railway Gauge Conversion Project) (in TN)
 30km long 3rd railway line between Tambaram-Chengalpattu (in TN)
 115km long Ennore-Chengalpattu section (in TN)
 271km long Tiruvallur (TN)-Bengaluru (Karnataka) section of one natural gas pipeline.
→ Norms eased for use of Railway land for cargo, schools & hospitals: Railway land can now be used to set up solar
plants, sewage and water treatment facilities at Re 1 per square meter per annum for 35 years and hospitals through
PPP and schools with Kendriya Vidyalaya Sangathan for Re 1 per square meter per annum for up to 60 years. GOI
now makes it simpler and cheaper for various entities to set up range of infrastructure on Railway land on long-term
lease. These include cargo-related enterprises, public utilities, renewable energy projects and even schools.
→ In collaboration with ISRO, Indian Railways will develop Real-Time Train Information System / RTIS system for real-
time tracking of train.
→ Lighter than its predecessors, but with more freight-carrying capacity, the Indian Railways’ 1st indigenously
manufactured aluminium goods train rake was flagged off from Bhubaneswar in Odisha.
→ Special Campaign 2.0 - Ministry of Railways holds 7000 cleanliness drives; to switch over to completely paperless
working from 1st November 2022: In line with the philosophy of Special Campaign 2.0, the Ministry of Railways sets
a wide target for itself. It is on a cleanliness mission and has taken up all 7337 stations for the Cleanliness Campaign.
A special emphasis has been laid on mechanized cleaning of railway stations. A special focus has been given to the
cleanliness of trains and stations. One such effort by Bangalore Railway Station was appreciated by Prime Minister
Narendra Modi. Additionally, public grievances are also monitored through the ‘Rail Madad portal’.
 Background:
• Inspired by the speech of PM Modi on 15th August 2021, GOI launched the Special Campaign in 2021 and
focused on cleanliness all around. Excited by the success of this special campaign, GOI again launched its
sequel in 2022 as ‘Special Campaign 2.0’ with increased targets and scope to further promote cleanliness
and good governance in all spheres of working through improved work culture.
About:
 What:
Page 492 of 719
 → One statutory body under ownership of Ministry of Railways, Government of India that operates India's national
railway system.
→ It manages 4th largest national railway system in world by size, with total route length of 67,956 km as of 2021. 52,247
km or 80% of all its broad-gauge routes are electrified with electric traction.
 Feature:
→ Indian railways is world’s 4th largest rail network in world.
→ Indian railways employ more than 1.3 million people.
→ It transports more than 90% of coal that provides 50% of India’s power requirement.
→ 100% FDI is allowed in Indian railways infrastructure sector. According to Department for Promotion of Industry and
Internal Trade, for railways and associated sectors, FDI inflows stood at USD 1.23 billion as of 2021.
 Train rake:
→ A rake in a train is a line of coupled passenger coaches, freight wagons, or railcars (excluding the locomotive) that
typically move together. One rake can have around 40 to 58 wagons attached to it.
→ They are usually made of steel. But, Aluminium rakes have the following advantages:
 Lighter, more speed, lower energy consumption and higher freight-carrying capacity. Lower CO2 footprint.
Recyclable 100%.
→ In 2022, lighter than its predecessors, but with more freight-carrying capacity, the Indian Railways’ 1st indigenously
manufactured aluminium goods train rake was flagged off from Bhubaneswar in Odisha. Its advantages are – cost
effective, energy efficient, indigenously developed, 181 tonnes lighter than existing steel rakes, higher payload,
safter and superior crash absorption capability.
 Initiative:
→ Rising passenger & freight traffic.
→ Increasing urbanization, rising incomes (both rural and urban), growing industrialization across India along with
private sector participation.
→ Increasing freight traffic.
→ Growing industrialization across India
→ Dedicated Freight Corridor
→ Diamond Quadrilateral.
→ Connecting major metros and growth centers of India.
Note:
 Dedicated Freight Corridor (DFC):
→ What:
 DFC is high speed and high capacity railway corridor that is exclusively meant for transportation of freight, i.e.,
goods and commodities.
 Under 11 Five Year Plan of India (2007–12), Ministry of Railways started constructing Dedicated Freight Corridor
(DFC) in two long routes, namely Eastern freight corridor and Western freight corridor. Eastern Dedicated Freight
Corridor stretched from Punjab to West Bengal and Western Dedicated Freight Corridor from Mumbai
(Maharashtra) to Uttar Pradesh.
→ Need:
 Indian Railways witnessed higher freight volumes without substantial investment in infrastructure, increased
load, reduction of turn-around time of rolling stock.
→ Focus:
 Upgrading of transportation technology
 increase in productivity
 reduction in unit transportation cost
→ Feature:
 DFC involves integration of better infrastructure and state of art technology.
 high-capacity, high-speed dedicated freight corridors
 DFC consists of 2 arms:
• Eastern Dedicated Freight Corridor (EDFC):
 under-construction broad gauge freight corridor in India. It will run between Ludhiana in Punjab and
West Bengal via Khurja in UP. It is implemented by Dedicated Freight Corridor Corporation of India
(DFCCIL).
 It will cover distance of 1,839 km.
 It starts in Ludhiana, Punjab and ends in West Bengal.
 EDFC route has coal mines, thermal power plants, and industrial cities.
 EDFC route covers Punjab, Haryana, UP, Bihar, Jharkhand, West Bengal.
 It is funded majorly by World Bank.
• Western Dedicated Freight Corridor (WDFC):

Page 493 of 719

  1,504 km long, under-construction broad gauge freight corridor in India. It will connect Jawaharlal
Nehru Port in Mumbai, MH and Dadri in UP. It is being built by Dedicated Freight Corridor Corporation
of India Limited (DFCCIL).
 WDFC is from Jawaharlal Nehru Port Trust in Mumbai to Dadri in UP, touching all major ports along
way.
 WDFC covers Maharashtra, Haryana, Rajasthan, Gujarat, Uttar Pradesh.
 It is funded by Japan International Cooperation Agency.
Connecting Link for Eastern and Western Arm is under construction between Dadri (UP) and Khurja (UP).
→ Implementation:
 Dedicated Freight Corridor Corporation of India Limited (DFCCIL) is designated by Government of India as 'Special
Purpose Vehicle', and is created to undertake planning & development, mobilisation of financial resources and
construction, maintenance and operation of Dedicated Freight Corridors. DFCCIL is registered as company under
Companies Act, 1956. It is subsidiary of Indian Railways.
 Golden Quadrilateral Freight Corridor (GQFC):
→ What:
 GQFC has 6 DFCs, 2 are being implemented and funding for remaining 4 was approved in 2018.
 Rail tracks linking 4 largest metropolitan cities of Delhi, Mumbai, Chennai, Kolkata and 2 diagonals
North-South Dedicated Freight Corridor (Delhi-Chennai) and East-West Dedicated Freight Corridor
(Kolkata-Mumbai) are called Golden Quadrilateral (GQFC).
 These 6 DFCs carry 55% of Indian Railway's freight traffic over a total 10,122 km route length.
→ Need:
 Surging requirement for power generation requiring heavy coal movement, booming infrastructure
construction and growing international trade.
→ Benefit:
 Carbon emission reduction from DFCs will help DFCCIL claim carbon credits.
 Diamond Quadrilateral:
→ Project of Indian railways to establish high -speed rail network in India. It is network of high-speed rail
→ It will connect 4 mega cities of India, viz. Delhi, Mumbai, Kolkata, Chennai, similar to Golden Quadrilateral
highway system.
Mains Link:
 Discuss how the development of railway infrastructure will create jobs and boost the economy with examples.

FOREIGN EXCHANGE RESERVES / FOREX RESERVES / FX RESERVES

News:
 2020:
→ During Covid-19 pandemic, despite economy slowdown, India’s Forex reserves rose.
 Reason:
• rare current-account surplus
• Rise in investment - Foreign Portfolio Investments (FPI), FDIs - in Indian stock markets.
• Fall in crude oil prices.
• Fall in outgoing overseas remittances
• Fall in foreign travels.
 2021:
→ India becomes world’s 4th largest Forex reserves holder, surpassing Russia.
 2022:
→ India’s forex reserves drops below USD 600 billion, plunging by from 2021, when forex reserves stood at all-time high
of USD 642 billion.
 Reason:
• Fall in dollar value of assets held as reserves by RBI.
• Appreciation of US dollar: Demand for dollars remained high as 2022 Russia-Ukraine war led to spike in oil
and commodity prices.
• Capital outflows by FPIs: FPIs pulled out USD 21.43 billion since 2021 as US Federal Reserve started
monetary policy tightening and interest rate hikes.
• Effect of gold prices: Decline in gold prices.
 Impact on rupee:
• Indian rupee fell to all-time low against US dollar, breaking through 77 rupees to 1 dollar threshold and
trading at 77.63.
• If rupee continues to fall, RBI will be forced to interfere in forex market by selling dollars from its forex
reserves.
• If RBI prioritises maintaining amount of foreign exchange reserves, rupee could depreciate.
→ RBI says India's FX reserves declined to USD 553.1 billion in September, lowest since 2020.

Page 494 of 719

  Reason behind decline: Low FII / FDI due to tightening monetary policy world over; RBI intervention in currency
markets to stabilize rupee.
→ India's forex reserves have tumbled (fall suddenly in amount) by about USD 110 billion from a peak of USD 642 billion
in September 2021.
 Reason:
• Fall in the value of holdings in dollars and other currencies. RBI's intervention in the currency market to
protect the rupee (For example – to defend the rupee, RBI sold a net USD 43.15 billion worth of dollars since
the start of 2022).
 Analysis:
• Analysts say RBI's 2013 playbook to buffer the domestic currency against steep declines and rebuild foreign
exchange reserves is unlikely to prove fruitful in the current 2022 crisis because economic fundamentals are
vastly different. Swapping Foreign Currency Non-Resident Account (FCNR) deposits at a concessional rate,
the RBI’s 2013 playbook, might not be as effective this time around, including for reasons like a narrower
US-IN rate spread and less aggressive rate hikes in this cycle versus back in 2013.
 Impact:
• Widening CAD which is expected to stay above 3% of GDP for the current fiscal year FY2022-23.
• Volatile capital flows, economists expect the Balance of payments to be -ve, depleting reserves further.
• While reserves at current levels are adequate to cover more than 8 months of imports, a fall below 8 months
of import cover (about USD 500 billion) could start catching the market’s attention.
 What is RBI doing about it?
• The RBI announced measures to liberalise foreign exchange inflows, including giving foreign investors access
to a larger portion of government debt and banks wider room to raise more deposits from non-residents.
 What measures need to be taken:
• Focussing on strengthening structural macro buffers.
• In the past, floating sovereign bonds, like the Resurgent India bonds (RIBs) and India Millennium Deposit
Bonds (IMDs) helped to boost forex reserves.
About:
 What:
→ Cash and other reserve assets such as gold held by central bank or other monetary authority that are primarily
available to balance payments of country, to influence foreign exchange rate of its currency, and to maintain
confidence in financial markets. Reserves are held in one or more reserve currencies, nowadays mostly US dollar and
to lesser extent Euro.
→ External assets in form of:
 gold
 IMF’s Special Drawing Rights (SDRs)
 Foreign Currency Assets (FCA):
• capital inflows to capital markets
• FDI
• External Commercial Borrowings (ECB)
• reserves in IMF
accumulated by India, though controlled by RBI.
 Component:
→ FCA (biggest component)
→ Gold reserve (2nd biggest component)
→ SDR
→ Reserve Tranche in IMF
 Feature:
→ Forex reserves assets can comprise banknotes, deposits and government securities of reserve currency, such as
bonds and T-Bills.
→ Some countries hold part of their reserves in gold, and special drawing rights (SDR).
→ Often, for convenience, cash or securities of reserve currency are retained by central bank and "holdings" of foreign
country are tagged or otherwise identified as belonging to other country without them actually leaving vault of that
central bank. From time to time they may be physically moved to home or another country.
→ Normally, interest is not paid on foreign cash reserves, nor on gold holdings, but central bank usually earns interest
on government securities. Central bank may, however, profit from depreciation of foreign currency or incur loss on
its appreciation. Central bank also incurs opportunity costs from holding reserve assets (especially cash holdings) and
from their storage, security costs, etc.
 IMF Forex ranking:
→ China - largest
→ Japan
→ Switzerland
Page 495 of 719
 → India
 Significance:
→ confidence in monetary policy
→ confidence in exchange rate management
→ comfort to government and RBI in managing India’s external and internal financial issues.
→ negates external vulnerability
→ absorb shocks during monetary crisis.
→ Strengthens rupee against US dollar.
→ confidence to markets that India can meet its external obligations.
→ backing of domestic currency (rupee) by external assets.
→ reserve for national disasters / emergencies
→ As last resort, borrowings from IMF, cover import bills of country – esp. oil import bills etc.
 India:
→ Since 1991, on average, India’s Forex reserves has been increasing.
→ Custody:
 RBI Act, 1934 provides legal framework for holding reserves.
 FCA:
• Majority of FCA is held in securities like T-Bills of foreign countries (mainly US).
• Some FCA is deposited in foreign central banks.
• Rest FCA is deposited in commercial banks abroad.
 Gold:
• Majority of gold, in tonnes, is held overseas in Bank of England and Bank for International Settlements
• Remaining gold is held domestically.
Glossary:
 Foreign Currency Non-Resident (FCNR) FD Account:
→ FCNR is a fixed deposit held in foreign currency. It is an investment option for NRI / PIO / OCIs looking to
retain their money in foreign currency for good r eturns.
Mains Link:
 Discuss how rising forex reserves are beneficial for India’s economy.

AGRICULTURE / AGRICULTURAL
News:
 2019:
→ PepsiCo (food company) sues some Indian farmers in Gujarat for cultivating one potato variety (FC5),
having lower moisture content required to make snacks like potato chips.
→ One farmers’ rights activist, petitioned Protection of Plant Varieties and Farmers Rights (PPVFR) Authority
for revocation of intellectual protection (IP) granted to PepsiCo’s said potato variety (FC5), saying that
India’s rules do not allow patent on seed varieties.
 2020:
→ Ministry of Agriculture declares Lakshadweep UT as fully organic.
→ Union Cabinet approves new pan India scheme called - Agriculture Infrastructure Fund (AIF).
→ Dept. of Agriculture to use drones (remote sensing technology), over crop fields, for crop yield estimation of rice and
wheat.
→ Union Minister for Power and MNRE reviewed implementation of PM-KUSUM Scheme.
 2021:
→ Budget 2021-22 allocates fund for Agriculture Infrastructure Fund (AIF).
→ India in top 10 list of agri produce exporters [as per 2021 WTO report].
→ Agriculture Infrastructure Fund (AIF) has given major boost to strengthening of PACS – lifelines of village-
level credit systems.
→ Protection of Plant Varieties and Farmers Rights Authority revokes Plant Variety Protection (PVP)
certificate granted to PepsiCo India Holding (PIH) on one potato variety (FL -2027).
→ NCRB releases report on Suicides among farm workers.
→ Prime Minister announces repeal of 3 contentious farm laws.
→ Centre approves and launches Central Sector Scheme of “Formation and Promotion of 10,000 Farmer
Producer Organizations (FPOs)” to form and promote 10,000 new FPOs till 2027 -28 with total budgetary
outlay of Rs. 6865 Cr.
 2022:
→ Congress manifesto for UP polls promises waiver of farm loans and a subquota for most backward classes
(MBCs) within other backward classes (OBC) quota to ensure maximum benefits, if voted to power.
→ Punjab Government is promoting cultivation of green manure. Punjab government is providing subsidy on
seed.
Page 496 of 719
→ One report by UNFAO and EBRD (European Bank for Reconstruction and Development), highlights need for
decarbonizing agrifood systems. Also, this report says Agrifood companies’ efforts to achieve carbon
neutrality have been uneven.
→ Centre is working on digital ‘stack’ of agricultural datasets, with its core as land records.
→ One SBI study released in 2022 reveals that only 50% of intended beneficiaries of farm loan waiver schemes
announced by 9 States since 2014 benefitted (actual debt write -off benefits) due to rejection of their
claims, limited or little fiscal space to meet promises and change in governments in subsequent years.
 Reason: Rejection of their claims by State governments; Limited or little fiscal space to meet promises;
Change in policies and in governments in subsequent years;
This SBI study also says average income of farmers grew only by 1.3 -1.7 times during 2017-18 and 2021-
22. Kisan Credit card and MSP have been instrumental in benefiting farmers. SHG have around 10% NPA
across India.
→ Pradhan Mantri Fasal Bima Yojana (PMFBY) has successfully entered its 7 th year of implementation with upcoming
Kharif 2022 season, completing 6 years of its implementation since its announcement in 2016. As part of this PMFBY
celebration, Govt. launches ‘Meri Policy Mere Hath’ in all implementing States.
→ 11th installment of PM Kisan Samman Nidhi, worth over Rs. 20,000 crores, transferred to more than 10 crore farmers.
→ National Dairy Development Board (NDDB) (one statutory body under National Dairy Development Board
Act, 1987 / NDDB Act 1987) launches one company (MRIDA ltd.) to work on manure management.
→ Ministry of Agriculture & Farmers’ Welfare launches 11 th Agriculture Census 2021-22.
→ In boost to farm sector, Union Cabinet approves restoring interest subvention on short-term agriculture
loans for all financial institutions that will ensure steady availa bility of credit for agriculture sector and
support lending institutions amid rising interest rates.
→ Department of fertilizers, MoCF institutes one dedicated officer known as ‘fertilizer flying squad’ to check
any diversion, black marketing or adulteration of fertilizers.
→ Ministry of Chemicals and Fertilizers announces that it will implement One Nation One Fertiliser by
introducing one single brand for fertilisers and logo under fertiliser subsidy scheme named Pradhan Mantri
Bhartiya Jan Urvarak Pariyojana (PMBJP). To bring about uniformity in fertiliser brands across India, GOI
issues order directing all companies to sell their products under one single brand name of ‘Bharat’. [Govt
wants all bags of subsidised fertiliser to prominently say 'Bharat' and mention subsidy scheme. But this
might disincentivise manufacturers, and scheme's political fallout remains to be seen].
→ Nearly 600 farmers in Maharashtra’s Marathwada region have died by suicide in 20 22, according to its
taluka offices.
→ As per data of Agriculture Ministry, there is 5.62% decrease in area covered in paddy cultivation in 2022
compared to previous year. As of now, paddy is cultivated in nearly 384 lakh hectares of area. Reason:
Higher input cost particularly increase in prices of fertilisers and scarcity of water. Also, there has been
decrease in cultivation of Pulses, Oilseeds; but cultivation of Sugarcane, Cotton increased.
→ Ashok Gulati (Indian agricultural economist and former chairman of CACP) writes that precision farming
needs to be promoted to get more output with less exploitation of natural resources. He further writes
that in India, we have culture of free power, free water, almost 80 to 90% subsidy on urea, and so on but
one critical factor that is needed is political economy of policies. He also emphasizes need to promote
natural farming / organic farming.
→ India hosts 9th Session of Governing Body of International Treaty on Plant Genetic Resources for Food and Agriculture.
→ In order to reduce use of chemical fertilisers by incentivising States, GOI plans to introduce one new scheme – PM
PRANAM.
→ Ministry of Food Processing launches one convergence portal between Agriculture Infrastructure Fund (AIF), Pradhan
Mantri Formalisation of Micro Food Processing Enterprises (PMFME) scheme, and PM Kisan SAMPADA Yojana
(PMKSY). This convergence portal of these GOI's 3 flagship schemes will help micro units engaged in food processing.
This convergence portal will allow beneficiaries of these 3 schemes to avail facilities hassle-free, and beneficiaries
will also get additional benefit of interest subvention at 3%.
→ FSG (one global nonprofit consulting firm) releases one Agritech report – “What’s next for Indian agri-tech?”.
→ MGNREGS will fund work to reverse desertification of land across States. This employment scheme will
work in tandem with Pradhan Mantri Krishi Sinchayee Yojana to help take up treatment of about 30% more
land than feasible with current scheme size. With limited funds to deal with big task of restoring degraded
land and reversing desertification in India, GOI is now planning to bring convergence between MGNREGS
and Pradhan Mantri Krishi Sinchayee Yojana (PMKSY).
→ Under proposed 'Bharat Krishi Satellite' programme of GOI, ISRO proposes dedicated satellites for
supporting India’s agriculture sector. [A minimum of 2 satellites will be needed for adequate coverage of
India’s agricultural area. Currently used satellites for agriculture are - Resourcesat (for crop production
forecast), Cartosat (topographic mapping), RISAT (weather imaging)].
→ PM Modi launches - Pradhan Mantri Bharatiya Jan Urvarak Pariyojana / One Nation One Fertiliser - a new
scheme for farmers under which companies must market all subsidised fertilisers under a single brand
'Bharat'.
Page 497 of 719
 → PM Modi inaugurates PM Kisan Samman Sammelan 2022. PM Modi also inaugurates 600 Pradhan Mantri
Kisan Samruddhi Kendras (PMKSK) under the Ministry of Chemicals & Fertilisers. PM Modi also releases the
12 th instalment amount of Rs. 16,000 crores under Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) through
Direct Benefit Transfer (DBT). PM Modi also inaugurates the Agri Startup Conclave and Exhibition. PM Modi
also launches ‘Indian Edge’, an e-magazine on fertiliser.
About:
 Law:
→ Agriculture is State subject.
 Status [India]:
→ struggling industry. There are many dimensions of present agrarian crisis in India. Growth: According to
Economic Survey [2021-22], agriculture and allied sectors grew at +ve growth rate of 3.6% during 2020-21.
→ Agricultural Produce:
 As per 2021 WTO report on trends in world agricultural trade:
• India entered top 10 list of countries exporting agricultural produce. India is 3rd largest cotton exporter.
India is 4th largest cotton importer. India lagged behind in value-added contribution to world agri exports.
 Natural farming:
→ What:
 developed by Fukuoka. also called Fukuoka Method, natural way of farming, Do-Nothing Farming. This system
is based on recognition of complexity of living organisms that shape ecosystem and deliberately exploiting it.
farming not just as means of producing food but as aesthetic and spiritual approach to life,ultimate goal of which
was cultivation and perfection of human beings.
Natural Farming is one chemical-free and traditional farming method. It is considered agro-ecology-
based diversified farming system which integrates crops, trees and livestock with functional biodiversity.
Natural farming is one ecological farming approach established by Masanobu Fukuoka (1913–2008).
Fukuoka, one Japanese farmer and philosopher, introduced term in his 1975 book “One-Straw Revolution”. This
title refers not to lack of effort, but to avoidance of manufactured inputs and equipment. Natural farming is
related to fertility farming, organic farming, sustainable agriculture, agroecology, agroforestry, eco-agriculture,
permaculture, but is distinguished from biodynamic agriculture.
→ 4 principles:
 human cultivation of soil, plowing or tilling are unnecessary. prepared fertilizers are unnecessary. weeding is
unnecessary. Instead, only minimal weed suppression with minimal disturbance should be used. applications of
pesticides, herbicides are unnecessary.
→ Concern:
 One ICAR research in India shows upon adoption of natural farming, yield goes down for major staple crops like
wheat and rice by as much as 30 to 50%. But yields recover back to normal levels after some time.
 Climate-smart agriculture (CSA) / Climate resilient agriculture:
→ What:
 It is an integrated approach to managing landscapes to help adapt agricultural methods, livestock and crops to
the effects of climate change and, where possible, counteract it by reducing GHG emissions from agriculture, at
the same time taking into account the growing world population to ensure food security. Thus, the emphasis is
not simply on carbon farming or sustainable agriculture, but also on increasing agricultural productivity.
→ Feature:
 CSA has 3 pillars: increasing agricultural productivity and incomes; adapting and building resilience to climate
change; and reducing or removing GHG emissions from agriculture.
 CSA lists different actions to counter the future challenges for crops and plants.
 With respect to rising temperatures and heat stress, e.g. CSA recommends the production of heat tolerant crop
varieties, mulching, water management, shade house, boundary trees and appropriate housing and spacing for
cattle.
 Organic Farming / Ecological farming / Biological farming:
→ What:
 Agricultural method that uses organic inputs – bio-fertilizers, bio-pest control – made from either animal or plant
waste.
Organic farming is one agricultural system that uses fertilizers of organic origin such as compost
manure, green manure, bone meal and places emphasis on techniques such as crop rotation and companion
planting.
→ Background:
 It originated in 20th century in reaction to rapidly changing farming practices.
→ Components:
 Vermicompost, Manures, Green leaf manures, Biofertilizers, Animal husbandry, Biological management, Crop
rotation.
→ Feature:

Page 498 of 719

  Biological pest control, mixed cropping and fostering of insect predators are encouraged.
 Organic standards are designed to allow use of naturally-occurring substances while prohibiting or strictly
limiting synthetic substances. For instance, naturally-occurring pesticides such as pyrethrin are permitted, while
synthetic fertilizers and pesticides are generally prohibited. Synthetic substances that are allowed include, for
example, copper sulfate, elemental sulfur and Ivermectin.
 Genetically modified organisms, nanomaterials, human sewage sludge, plant growth regulators, hormones, and
antibiotic use in livestock husbandry are prohibited.
 Organic farming advocates claim advantages in sustainability, openness, self-sufficiency, autonomy and
independence, health, food security, and food safety.
→ Significance:
 agro-ecosystem health. does not use chemicals. safer food choices. environment-friendly agriculture.
Biodiversity. biological cycles. soil biological activity.
→ India:
 Largest number of organic farmers in world. Top 10 in world in terms of area under organic farming. Sikkim –
1st State in world to become fully organic.
 NE India:
• traditionally been organic. consumption of chemicals is lesser than rest of India.
 Tribal and island territories continue their organic uses.
 Major organic exports - Sesame, soybean, tea, medicinal plants, rice, pulses.
→ Initiative:
 Mission Organic Value Chain Development (MOVCD) for NE India.
 Paramparagat Krishi Vikas Yojana (PKVY).
 National Program for Organic Production (NPOP).
→ Fact:
 ½ of total Certified organic agriculture area is in Australia.
 Conservation agriculture (CA):
→ What:
 UNFAO defines it as one farming system that promotes minimum soil disturbance (i.e. no -till farming),
maintenance of permanent soil cover, and diversification of plant species. It enhances biodiversity and
natural biological processes above and below ground surface, which contribute to increased water and
nutrient use efficiency and to improved and sustained crop production.
→ Feature:
 It promotes utilization of green manures / cover crops to produce residue cover.
 It does not associate with monoculture and plantation crops.
 Adopting minimum tillage.
 Using crop residues to cover soil surface.
 Adopting spatial and temporal crop sequencing / crop rotations.
 Precision agriculture (PA):
→ One farming management concept based on observing, measuring and responding to inte r and intra-field
variability in crops. 1 st conceptual work on PA and practical applications go back in 1980s. Goal of precision
agriculture research is to define decision support system (DSS) for whole farm management with goal of
optimizing returns on inputs while preserving resources.
 Agrifood systems:
→ What:
 Agrifood systems encompass primary production of food and non -food agricultural products, as well
as in food storage, aggregation, post-harvest handling, transportation, processing, distribution,
marketing, disposal and consumption. Within agrifood systems, food systems comprise all food
products that originate from crop and livestock production, forestry, fisheries and aquaculture, and
from other sources such as synthetic biology, and that are intended for human consumption.
→ Components:
 Agrifood systems have 3 main components: primary production, food distribution, household
consumption.
→ Status:
 Global agrifood systems account for 21-37% of total anthropogenic GHG emissions. Global ag rifood
systems are affected by global warming via changing rainfall patterns, supply chain disruptions.
→ Initiatives:
 Agrifood companies have been putting efforts to achieve carbon neutrality. However, one report by
UNFAO and EBRD says that Agrifood companies’ efforts to achieve carbon neutrality have been
uneven. Reasons are:
• Governance of standards and processes: This is one common terminology surrounding carbon neutrality
and which is still lacking. Knowledge, data and tools gaps at several levels. Costs: Costs of becoming carbon
Page 499 of 719
 neutral can be relatively high for smaller farmers and companies. Engaging smaller players: While some
companies are engaging SMEs and smallholder farmers in carbon neutrality efforts, so far wide-scale
engagement has been minimal.
→ Recommendation for greener agrifood system:
 Strategically target carbon neutrality via decarbonization policies, Nationally Determined
Contributions. Improve and standardize tools via simplification and harmonization of databas e and
standards for carbon accounting. Directly support Agrifood companies, farmers to decarbonize.
Awareness and education on carbon neutrality. Promote sound governance mechanisms to guide low -
carbon investment and private sector compliance.
 Manure:
→ What:
 Organic matter that is used as organic fertilizer in agriculture.
→ Feature:
 Most manure consists of animal feces; other sources include compost and green manure. Manures
contribute to fertility of soil by adding organic matter and nutrients, such as nitro gen, that are utilised
by bacteria, fungi, other organisms in soil. Higher organisms then feed on bacteria, fungi in chain of
life that comprises soil food web.
→ Green manure:
 What:
• In agriculture, green manure is crop specifically produced to be incorporated into soil while still green.
Typically, green manure's biomass is incorporated with plow or disk, as is often done with (brown) manure.
 Goal:
• To add organic matter to soil for its benefits. To add nitrogen to soil.
 Example:
• There are 3 main varieties of green manure: Dhaincha, Cowpea, Sunhemp. Some crops such as summer
moong, mash pulses, guar act as green manure.
 Usage:
• Green manuring is often used with legume crops to add nitrogen to soil for crops, especially in organic
farming, but is also used in conventional farming. Green manure are normally incorporated back into soil,
either directly, or after removal and composting. Green manure varieties are incorporated into soil when
crop is 42-56 days old.
 Benefits:
• Green manure maintains soil fertility and structure. Helps in enhancing organic matter in soil. Meets
deficiency of micronutrients. Reduces consumption of inorganic fertilisers. It is good alternative to organic
manure. It conserves nutrients, adds nitrogen and stabilises soil structure. It decomposes rapidly and
liberates large quantities of CO2 and weak acids, which act on insoluble soil minerals to release nutrients
for plant growth. It contains dry matter, which also contains phosphorus, potassium, zinc, copper, iron,
manganese, nitrogen.
 Punjab:
• Importance of green manure in Punjab:
 Punjab’s per hectare fertiliser consumption is one of highest in India and is also higher than national
average. Green manure can curtail this fertiliser consumption to large extent by 25 to 30% and can save
huge input cost for farmers. Regular use of chemical fertilisers such as urea, diammonium phosphate
(DAP) lead to deficiencies of micronutrients like iron, zinc, especially in soils where rice is cultivated and
thus affecting productivity. PH level of soil in several parts of Punjab is more than 8 %. Green manure
helps maintain it.
→ Manure management:
 What:
• Manure management refers to capture, storage, treatment, and utilization of animal manures in
environmentally sustainable manner.
 Benefits:
• Lower cost of fertilizers (by producing bio -slurry), increases income from milch animals, lowers
Greenhouse emissions (by generating biogas which can be substitute for LPG).
 Initiative:
• Gobar Dhan scheme (energy from cattle waste); SuDhan (one trademark to provide common
identity to dung-based organic fertilizers); Capital Investment Subsidy Scheme (CISS) of National
Mission for Sustainable Agriculture (NMSA): Production of organic manure from bio -waste.
 Improvements in agriculture sector [as of 2021] [India]:
→ record production of certain major agricultural produce. rise in exports. India has caught up with global
levels of fertilizer use. Initiatives like eNAM are helping integrate farmers’ produce directly with market.
 Farmer:

Page 500 of 719

 → Status:
 Monthly income: Estimated average monthly income per agricultural household as obtained from NSS 77th
round (2018-19) was calculated as Rs.10,218/-.
→ Women Farmers:
 Initiative:
• In order to familiarize women with latest techniques in agriculture and allied sectors, trainings are being
imparted to women farmers under many schemes of Ministry of Agriculture & Farmers Welfare, Ministry of
Rural Development.Guidelines of many beneficiary-oriented schemes of Min. of Agriculture & Farmers
Welfare provide that States and other Implementing Agencies should provide atleast 30% expenditure on
women farmers. National Food Security Mission [2017]. Mahila Kisan Sashaktikaran Pariyojana (MKSP)
[2011]. National Mission on Edible Oil-Oil Palm (NMEO-OP) [2021]. National Mission for Sustainable
Agriculture (NMSA) [2010]. Sub-Mission on Seeds and Planting Materials. Sub-Mission on Agricultural
Mechanization. Mission for Integrated Development of Horticulture.
 Need for promotion of women farmer:
• Agriculture support system in India strengthens exclusion of women from their entitlements as agriculture
workers and cultivators. Rural women form most productive work force in economy of majority of
developing nations including India. More than 80% of rural women are engaged in agriculture activities for
their livelihoods. About 20% of farm livelihoods are female headed due to widowhood, desertion, or male
emigration. Most of women-headed households are not able to access extension services, farmers support
institutions and production assets like seed, water, credit, subsidy etc. As agricultural workers, women are
paid lower wage than men.
→ Concern:
 Farmer suicides:
• Causes: There is no consensus on what main causes might be but studies show suicide victims are motivated
by more than 1 cause. However, primary reason is inability to repay loans. Bankruptcy / indebtedness.
problems in families. crop failure. Illness. alcohol / substance abuse.
→ Initiative:
 Mahila Kisan Sashaktikaran Pariyojana (MKSP) [2011], PM-KUSUM Scheme [2019], PM Kisan Maan Dhan Yojana,
Soil Health Card (SHC) Scheme, Pradhan Mantri Fasal Bima Yojana (PMFBY) [2016], Biotech-Kisan [2017], PM-
Kisan Samman Nidhi [2018], increase in MSP, Agro-forestry through ‘Har Medh Par Ped’ for additional income,
National Bamboo Mission, PM Annadata Aay Sanrakshan Abhiyan (PM-AASHA) for ensuring remunerative prices
for produce, Formation and promotion of 10,000 FPOs, National Mission for Sustainable Agriculture (NMSA) etc.
 Seed:
→ Law (India):
 Protection of Plant Varieties and Farmers’ Rights Act, 2001.
 According to Indian Patents Act, 1970, Plant varieties are not eligible to be patented in India. According
to Indian Patents Act, 1970, biological process to create seed cannot be patented in India.
 Farm loan waiver [India]:
→ Background:
 To help farm sector, State governments have time and again announced loan waiver schemes.
 Example:
• In 2008-09, then UPA government at Centre had announced loan waiver scheme for entire country.
In recent past, Madhya Pradesh, Chhattisgarh, etc have also a nnounced similar loan waiver
schemes. In every State election during last few years, loan waiver promise was made by one political party
or another. In 2022, Congress manifesto for UP polls promises waiver of farm loans and a subquota
for most backward classes (MBCs) within other backward classes (OBC) quota to ensure maximum
benefits, if voted to power.
→ Drawback:
 Farm loan waiver covers only tiny fraction of farmers. Loan waiver as concept excludes most of farm households
in dire need of relief and includes some who do not deserve such loan waiver relief on economic grounds. Farm
loan waiver provides only partial relief to indebted farmers because about 1/2 of institutional borrowing of
cultivator is for non-farm purposes. In many cases, one household has multiple loans - either from different
sources or in name of different family members - which entitles it to multiple loan waiving. Loan waiving excludes
agricultural labourers who are even weaker, financially, than cultivators. Loan waiving severely erodes credit
culture, with dire long-run consequences to banking business. Loan waiving is prone to serious exclusion and
inclusion errors, as evidenced by Comptroller and Auditor General’s (CAG) findings in 2008 Agricultural Debt
Waiver and Debt Relief Scheme. Loan waiving schemes have serious implications for other developmental
expenditure, having much larger multiplier effect on economy.
→ RBI observations:
 RBI says loan waivers not only inhibit investment in farm sector but also put pressure on fiscal of concern States.
RBI repeatedly argued that loan waivers have hurt credit culture, and stressed budgets of waiving State or
Central government.
Page 501 of 719
 → Way Forward:
 Proper identification:
• For providing immediate relief to needy farmers, more inclusive alternative approach should be to identify
vulnerable farmers based on certain criteria and give equal amount as financial relief to vulnerable and
distressed families.
 Enhance non-farm income:
• Sustainable solution to indebtedness and agrarian distress should be to raise income from agricultural
activities and enhance access to non-farm sources of income. Low scale of farms means that some
cultivators should move from agriculture to non-farm jobs.
 Public funding and support:
• Improved technology, expansion of irrigation coverage, crop diversification towards high-value crops are
appropriate measures for raising productivity and farmers’ income. All these require more public funding
and support.
 Agriculture Census in India:
→ What:
 Agriculture Census forms part of broader system of collection of Agricultural Statistics in India. It is
large-scale statistical operation for collection of requisite data and derivation of quantitative
information about structural characteristics of agriculture in India. Through Agriculture Census, basic
data on important aspects of agricultural economy of operational holdings in India is collected. This
census is part of UNFAO World Census of Agriculture and has been conducted every 5 years from 1970-
71. Basic unit of data collection in Agriculture Census is operational holding.
→ Operational holding:
 It is defined as all land which is used wholly or partly for agricultural production and is operated as
one technical unit by one person alone or with others without regard to title, legal form, size or
location. It is taken as statistical unit for data collection in Agriculture Census. Unlike FAO’s definition,
Indian operational holding doesn’t include holdings under livestock, poultry, fishing, etc.
→ 11 th Agriculture Census in India 2021-22:
 Unique feature: Data collection will be conducted on smartphones and tablets. Use of digital land
records like land title records and survey reports.
 Aim: It will provide updated information number and area of operational ho ldings, their size, class-
wise distribution, land use, tenancy and cropping pattern, etc.
 World Census of Agriculture (WCA) [1950]:
→ It is statistical operation for collecting, processing and disseminating data on structure of agriculture,
covering whole or significant part of any country. Started by UNFAO. FAO’s definition of operational
holding includes holdings under livestock, poultry, fishing, etc.
 Fertilizer / Fertiliser:
→ What:
 It is any material of natural or synthetic origin that is applied to soil o r to plant tissues to supply plant
nutrients. Fertilizers may be distinct from liming materials or other non -nutrient soil amendments.
Many sources of fertilizer exist, both natural and industrially produced. For most modern agricultural
practices, fertilization focuses on 3 main macro nutrients: Nitrogen (N), Phosphorus (P), Potassium (K)
with occasional addition of supplements like rock dust for micronutrients. Farmers apply these
fertilizers in variety of ways: through dry or pelletized or liquid application processes, using large
agricultural equipment or hand-tool methods.
→ Status:
 On fertilizer use and subsidy:
• Total requirement of 4 fertilisers — Urea, Di-ammonium Phosphate (DAP), Muriate of potash (MOP), and
Nitrogen, Phosphorus and Potassium (NPKS) — increased by 21% between 2017-18 and 2021-22.
• Subsidy burden on chemical fertilisers is expected to increase to Rs. 2.25 lakh crore in 2022-23, which is 39%
higher than 2021-22’s figure of Rs. 1.62 lakh crore.
• Kharif season (June-October) accounts for nearly ½ of year’s production of foodgrains, 1/3 rd of pulses,
approximately 2/3rd of oilseeds. So, sizable amount of fertiliser is required for this Kharif season.
→ Organic fertilizer:
 What:
• They are fertilizers that are naturally produced. Fertilizers are materials that can be added to soil or plants,
in order to provide nutrients and sustain growth. Typical organic fertilizers include all animal waste including
meat processing waste, manure, slurry, and guano; plus plant based fertilizers such as compost; and
biosolids. Inorganic "organic fertilizers" include minerals and ash. The organic-mess refers to the Principles
of Organic Agriculture, which determines whether a fertilizer can be used for commercial organic
agriculture, not whether the fertilizer consists of organic compounds.
• Organic fertilisers are derived from animal products and plant residues.

Page 502 of 719

  Type:
• Bio-fertiliser:
 They are composed of living microorganisms attached to solid or liquid carriers and are useful for
cultivable land, as these microorganisms help in increasing the productivity of soil and / or crops.
In India at present, bio-fertiliser production is just over 110,000 tonnes (carrier-based 79,000
tonnes and liquid-based 30,000 tonnes).
• Organic manure:
 It refers to partially decomposed organic matter like digestate from a biogas plant, compost and
vermicompost, which provides nutrients to the soil / crops and improves yield.
In India at present, organic manure production is about 34 million tonnes, composed of
farmyard manure, city compost and vermicompost, among others].
 Potentials of India:
• India produces > 150,000 tonnes of municipal solid waste (MSW) [Based on estimated MSW generation data
from National Solid Waste Association of India and CPCB]. Considering collection efficiency of 80% and
organic part of MSW to be 50%, total organic waste generated per day in India comes to around 65,000
tonnes per day. Even if 1/2th of this is diverted to the biogas industry, GOI can leverage this by reduction in
import of fossils and fertilisers].
• Biogas / gobar gas plants produces biogas, and organic fertilisers. There is also great value in the organic
fertiliser also known as digestate, which is the biogas plant's effluent. [Digestate can provide organic carbon
to the continuously depleting soil, apart from its standard nutrition value].
 Status:
• The popularity of organic farming has grown in the domestic market in recent years. The market size for
Indian organic packaged food is expected to grow at a rate of 17% and cross Rs. 871 million by 2021. The
significant rise of organic farming sector is linked to growing awareness about the harmful effects of
synthetic fertiliser on soil, rising health concerns, expanding urban population base, increased consumer
expenditure on food goods.
• India is the largest importer of fertilizer, 2nd largest fertilizer-consuming country (after China) and 3rd largest
producer of it (the largest producer is China).
 Issue:
• Low penetration: In India, the proportion of organic fertilisers of the overall fertiliser consumption was only
0.34% for 2019-20.
 Initiative:
• SATAT scheme.
 Way Forward:
• With the promotion of biogas production, GOI can reap the benefits of its bi-product — fertiliser.
• With the right policy interventions, India can become the hub of organic fertiliser production. GOI has
announced schemes worth crores for various sectors. Similar steps need to be undertaken for the organic
fertiliser industry, as India has the potential to become the hub of organic fertiliser production in the world.
• Bio-compressed natural gas (bio-CNG) and solid organic manure or digestate can be produced in large
quantities under SATAT programme.
• Because organic manure can be improved with the use of bio fertilisers to meet nutrient requirements, both
bio fertilizers and organic manure have the potential to eliminate the usage of synthetic fertilisers
completely.
→ Issue:
 About 10 lakh tonnes (worth around 6000 cr) of agriculture -grade urea (despite need for coating) is
getting diverted for industrial use every year. Subsidized urea is getting diverted mainly to industries.
Agriculture-grade urea is neem-coated while technical-grade urea is not. Neem-coating is removed
through some chemical process and then urea is used for industrial purposes.
 Deficit: India’s annual domestic demand for urea is around 350 lakh tonnes, of which 260 lakh tonnes
are locally produced while remaining is imported.
 Subsidy: GOI’s annual fertiliser subsidy bill is likely to be around Rs 2.5 lakh crore during this fiscal
because of high international prices.
 Huge requirement for industries: There is annual requirement of around 13 -14 lakh tonnes of
technical-grade urea for industrial usage, of which only 1.5 lakh tonnes are produced in India.
 Uses of Urea: It is used in various industries such as resin / glue, plywood, crockery, moulding powder,
cattle feed, dairy and industrial mining explosives.
 Pests and diseases have developed resistance to existing pestic ide applications, and thus requiring
stronger, more toxic responses every passing year.
 When every measure to stop pests fails, it’s extremely toxic weapon of last resort. It also affects brain
development in humans, particularly children.
→ Initiative:

Page 503 of 719

  PM PRANAM. Pradhan Mantri Bharatiya Jan Urvarak Pariyojana / One Nation One Fertiliser.
 PM Kisan Samman Sammelan 2022.
 Pradan Mantri Kisan Samruddhi Kendras. PM Modi in 2022 pledged to convert 3.5 Lakh fertiliser retail shops
into Pradan Mantri Kisan Samruddhi Kendras in a phased manner; to cater to a wide variety of needs of the
farmers
 PM-KISAN Funds.
→ Achievement:
 As of 2022, more than 70 lakh hectare land has been brought under micro irrigation in the last 7-8 years.
 As of 2022, more than 1.75 crore farmers and 2.5 lakh traders have been linked with e-NAM. Transactions
through e-NAM have exceeded Rs. 2 lakh crore.
→ Way Forward:
 More and more startups in agriculture sector is good for the Agriculture sector and rural economy.
 The need of the hour is to adopt technology-based modern farming techniques.
 Considering genetic altering impact on human body and biodiversity loss, reduction in pesticide usage should
have become national priority long ago.
 4 interventions that will reduce farm chemical input usage by 1/3 rd:
• Business model of farm chemical input industry must transform to become one service industry i.e. apart
from selling farm chemicals, services like spraying onto farms which will ensure lesser input application.
In India, shopkeepers sell farm chemical inputs from multiple companies, and their business model —
like any other business — rewards shopkeepers with higher margins for increasing sales. Shopkeepers also
nudge farmers to buy what they may not necessarily need. But, when one is selling poisonous substances,
these practices are disgusting. Individual farmers cannot afford good quality precision spraying equipment
and this leads to wrong application and excess usage.
One way could be: To offset these issues, 10% of farm chemical input sales of each seller could be in
form of services (spray on farms). Each following year, seller would mandatorily increase services by
additional 10%, till business model had become one of services contracted, and not of farm chemical inputs
sold.
• Shopkeepers should report each sale of farm chemicals to government in real time. In 2021, in Punjab, one
interface was developed for this purpose.
• One mandatory QR code on each farm chemical package: Bayer (world’s largest seed and pesticide
company) started to print QR code on every pesticide package. It is one excellent idea that will allow each
farm input package used on farm to be traceable to factory floor.
These measures will allow for better-targeted farm advisory and grievance redressal. Lack of real-time
quality data inhibits transparency and accountability, making reduction of chemical use difficult.
• One independent regulator: Safety data generated by farm chemical industry is practically taken at face
value when regulatory approval is given. But volunteerism is no substitute for regulation. Basic tenets of
law dictate that regulators have to be independent. Horrifyingly, however, in case of farm chemical inputs,
same officials and departments that advocate their use also regulate trade. This adds to misgovernance and
other attendant problems. To ensure independent regulatory authority, Union Cabinet Secretary should
order that regulation of farm chemicals be transferred to health ministry.
 Agricultural technology / Agrotechnology / Agtech / Agritech / Agrotech:
→ What:
 It is use of technology in agriculture, horticulture, and aquaculture with aim of improving yield,
efficiency, and profitability. Agricultural technology can be products, services or applications derived
from agriculture that improve various input / output pr ocesses. Advances in agricultural science,
agronomy, and agricultural engineering have led to applied developments in agricultural technology.
→ Benefit:
 Higher crop productivity. Efficiency in farm inputs. Reduced impact on natural ecosystems. Efficient
produce & waste management. Benefit for all.
 Seed quality enhancing: HYV seeds and GE seeds (BT Cotton etc) lead to efficient use of pesticides,
water, etc. and can increase yields.
 Efficiency in farm inputs:
• On water: Drip irrigation technology, use of sensors for moisture control, sprinklers for irrigation.
• On fertilizers and pesticides: Fertilizer sensors, drones for spraying pesticides.
• On efficient input data - Kisan Suvidha portal, PM-Kisan.
• On electricity: Solar-powered water pumps.
• On labour: Mechanization of harvest led to improved labour productivity.
• On harvest management: PUSA Biodecomposer - for dealing with stubble / crop residue. Agricultural waste
is used as input for bioethical production.
→ Status of India’s agricultural technology sector:

Page 504 of 719

  Currently, it is estimated that there are about 600 to 700 agri-tech startups in India operating at different levels
of agri-value chains. Many of them use AI, ML, IoT, etc, to unlock potential of big data for greater resource use
efficiency, transparency and inclusiveness. Eg. Ninjacart (one Indian fresh produce supply chain company),
DeHaat (one Indian agriculture company), Crofarm (Otipy).
 According to one Agritech report – “What’s next for Indian agri-tech?” - released by FSG (one global nonprofit
consulting firm) in 2022, Agri-tech startups are driving India’s agri-tech innovations and investment story with
significant private equity inflows. And , areas of focus are market linkages, agri-fintech, farm management
software, remote sensing and advisory, and farm automation. And, technology has irreversibly disrupted
traditional agricultural value chain – from how farmers access information and inputs to how they grow and sell
their produce.
→ Significance:
 As per agricultural expert, Ashok Gulati, Agritech startups can steer shift from government-controlled
agricultural markets towards more demand-driven digital markets.
 Ninjacart reduced wastage to 4% compared to up to 25% in traditional chains through demand-driven harvest
schedule.
 DeHaat has enabled up to 50% increase in farmers’ income as result of savings in input costs, increased farm
productivity, and better price discovery.
 Agristack:
→ What:
 Digital ‘stack’ comprising agricultural datasets.
 collection of technologies, digital databases proposed by Central Government focusing on India’s
farmers, agricultural sector.
 digital repository
→ Aim:
 To primarily tackle issues such as poor access to credit, wastage in agricultural supply chain.
→ Need:
 At present, majority of farmers across India are small and marginal farmers with limited access to
advanced technologies, formal credit that can help improve output and fetch better prices.
→ Features:
 Under AgriStack, government aims to provide required data sets of farmers’ personal info rmation to
Microsoft to develop farmer interface for smart and well -organized agriculture.
 It will aid precise targeting of subsidies, services, policies.
 Under this programme, each farmer of India will get one Farmers’ ID (FID), linked to land records to
uniquely identify them. [India has 140 million operational farm -land holdings].
 Under this programmes, new proposed digital farming technologies, services include sensors to
monitor cattle, drones to analyse soil, drones to apply pesticide. These may signi ficantly improve farm
yields, boost farmers’ incomes.
→ Issues:
 Agriculture has become latest sector getting boost of ‘ techno solutionism’ by government.But it has,
since then, also become latest sector to enter whole debate about data privacy, surveillance.Since
signing of MoUs, many concerns related to sharing farmers’ data with private companies are raised.
 It has raised serious concerns about information asymmetry, data privacy, consent, profiling of farmers,
mismanaged land records, corporatization of agriculture.
 It implies commercialization of agriculture extension activities as they will shift into digital, private sphere.
 This project is implemented in absence of data protection legislation.
 It might end up where private data processing entities may know more about farmer’s land than farmer himself.
 Without safeguards, private entities would be able to exploit farmers’ data to whatever extent they wish to.
 This information asymmetry, tilted towards technology companies, might further exploit farmers, especially
small and marginal ones.
 This centralised stack will use old and inaccurate land records; farmers’ personal and financial details without
strong data protection law; and rural areas have low level of digital literacy.
 Issues [India]:
→ There are problems with current farming methods such as:
 Degradation of land (almost 30%). Depletion of Groundwater. Polluted air e.g., stubble burning. Extreme
weather events. Ecological imbalance i.e. pace of human population growth has not been in line with earth’s
carrying capacity.
→ low crop yield. monsoon dependency. low share of exports in global markets. lag in farm mechanization.
burden of loans. Disguised unemployment on farms remains high. Fragmentation of land holdings has left many
farmers with farms that are too small to be remunerative. Low access to credit, irrigation & technology. 1/10thof our
farmers are landless. Landless farmers use rented land, but inadequacies of land-leasing mechanisms make it difficult

Page 505 of 719

 for them to raise production. Most of suicides occurr in areas of cash crops (cotton, sugarcane) which is high input,
high output gambling, not based on principle of sustained and resilient high yield.
→ Farmer suicides:
 Causes:
• There is no consensus on what main causes might be but studies show suicide victims are motivated by
more than 1 cause. However, primary reason is inability to repay loans. Bankruptcy / indebtedness.
problems in families. crop failure. Illness. alcohol / substance abuse.
• Activists have blamed government policies as well as lack of financial help from legal sources to be cause of
deaths. Farmers need money on time during sowing season. However, banks often delay payments due to
lengthy procedures, forcing farmers to opt for private loans as alternative for immediate investment
requirements. Though such practices are illegal, farmers have no option other than seeking money from
moneylenders and interest rates charged on these private loans are extremely high. Lenders charge up to
60% interest over loan amount.
→ Irrigation reaches less than half of India’s overall farmland. More than 60% of our farmers are susceptible
to rainfall anomalies. Rain-fed farming yields are typically less than those of irrigated farmland. Fertilizer
use is neither efficient nor environmentally sustainable. Both add to cost of cultivation. Farmers are now
using patented seeds to get high yield. Cutting role of intermediaries is still lagging behind.
 Initiative [Global]:
→ International Treaty on Plant Genetic Resources for Food and Agriculture (2001).
 Initiative [India]:
→ In 2022, PM Modi said that GOI tackled the black marketing of urea by coating it with 100% neem, and that GOI
worked hard to restart India's 6 largest urea factories, which were closed for years.
→ GOI increased in Budget for agriculture.
→ “Prime Minister Krishi Sinchayee Yojana”.
→ National Agriculture Market (E-Nam) [2016]:
 What:
• online trading platform i.e. enam.gov.in. for agriculture produce
 Aim:
• help farmers, traders, buyers with online trading. better price mechanism via smooth marketing.
 Implementing agency:
• Small Farmers Agribusiness Consortium (SFAC) under Ministry of Agriculture and Farmers’ Welfare,
Government of India.
 Advantage:
• For farmer: More options for sale. Access to markets. Warehouse-based sales and thus no need to transport
his produce to mandi. For trader: Local trader in mandi / market can access larger national market for
secondary trading. Participate directly in trading at local mandi / market level and thereby reducing
intermediate costs.
→ Agriculture Infrastructure Fund (AIF) [2020]:
 What:
• medium–long term debt financing facility for investment in viable projects for - post-harvest
management infrastructure; and community farming assets - through interest subvention and
credit guarantee. one important scheme in Budget 2021-22. pan India. Central Sector Scheme.
Duration is from FY2020 to FY2032 (about 13 years). under Ministry of Agriculture & Farmers
Welfare.
 Objective:
• Creating post-harvest management infrastructure through credit guarantee support and 3% interest
subvention.
 Feature:
• Banks and financial institutions will provide loans with interest subvention; and credit guarantee
coverage under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE). Loan
target areas: cold storage, sorting, grading units, assaying units, silos, …
• Provide debt financing facility for post-harvest management infrastructure and community farming assets.
• Corpus of Rs. 1 lakh crore for FPOs, SHGs, PACS, Startups, Agri-entrepreneurs, for other farm processing-
based activities.
• Interest subvention of 3% per annum up to Rs. 2 crore for max. period of 7 years.
• Moratorium for repayment from 6 months up to 2 years.
 Eligibility:
• Farmers; State Agencies/APMCs; National Federation of Cooperatives; State Federations of
Cooperatives; FPO; Agri-entrepreneurs; PACS; Marketing Cooperative Societies; Multipurpose
Cooperative Societies; SHGs; Joint Liability Groups (JLG); Public -Private Partnership Projects;
Multipurpose Cooperative Societies; Startups; ….

Page 506 of 719

  Management:
• AIF will be managed / monitored through online Management Information System (MIS) platform.
Monitoring Committees at National, State, District levels will be set up for real -time monitoring
and effective feed-back.
 Way Forward:
→ Ashok Gulati (Indian agricultural economist and former chairman of CACP) wrote that precision farming
needs to be promoted to get more output with less exploitation of natural resources. He further wrote
that in India, we have culture of free power, free water, almost 80 to 90% subsidy on urea, and so on but
one critical factor that is needed is political economy of policies. He also emphasized need to promote
natural farming / organic farming.
→ Focus on precision farming as it can give India “more from less”.
→ Focus on organic farming (Sikkim was declared organic State).
→ Focus on natural farming. Example - Arth Ganga initiated major programme on natural farming along
Ganga, 5 km on each side of its banks. Many States like Andhra Pradesh are also scaling up natural farming.
→ Focus on emerging technologies: Geographical Information System (GIS), Artificial Intelligence a nd
Machine Learning (AIML) can use enormous data and bring about precision in farming.
→ Reduction of subsidies: Government’s heavy subsidy (80 to 90% subsidy on urea) can be significantly
reduced. It will also help prevent water pollution due to overuse of fertilizers.
→ 2004 Swaminathan Commission recommended that to address growing farmer suicides, provide affordable
health insurance at primary health centres in rural areas. Extension of national rural health mission to
suicide-prone areas. Restructuring of microfinance policies, covering all crops by insurance and social
security net for support. Give farmers MSP at 50% profit above cost of production classified as C2 by
Commission for Agricultural Costs and Prices (CACP). Magic wand of loan waiver can offer temporary relief,
but long-term solutions will be required to solve farmer distress. There are many dimensions of present
agrarian crisis in India and therefore, solution needs to be comprehensive by taking into consideration all
factors. Both short- and long-term measures are required to address numerous problems associated with
agrarian crisis.
→ India needs proper policy decision with better and more scientific evidence if India wants to avoid Sri
Lanka-like fiasco.
Note:
 SATAT scheme:
→ GOI scheme to promote Organic Fertiliser industry. Under this scheme, > 5,000 projects have been targeted
across India. It was estimated that 50 million tonnes per annum of solid organic manure / digestate will be
generated in India once these projects are installed – which could be used for production of Organic
Fertiliser.
 “Prime Minister Krishi Sinchayee Yojana” / Pradhan Mantri Krishi Sinchai Yojana / PMKSY:
→ What:
 One national mission to improve farm productivity and ensure better utilization of resources in India.
→ Objective:
 To achieve convergence of investments in irrigation at field level.
 Expand cultivable area under assured irrigation
 Improve on-farm water use efficiency to reduce wastage of water
 Enhance adoption of precision-irrigation and other water saving technologies (More crop per drop)
 Enhance recharge of aquifers and introduce sustainable water conservation practices by exploring
feasibility of reusing treated municipal waste water for peri -urban agriculture
 Attract greater private investment in precision irrigation system.
→ Feature:
 Work done under PMKSY:
• Ridge area treatment; Drainage line treatment; Soil and moisture conservation; Rainwater harvesting;
Nursery raising; Afforestation; Horticulture and pasture development.
 Modified Interest Subvention Scheme (MISS):
→ What:
 In order to ensure that farmers have to pay minimal interest rate to bank, GOI had introduced Interest
Subvention Scheme (ISS), now renamed as MISS, to provide short term credit to farmers at subsidized
interest rates.
It is one form of waiver of some % of interest from total interest that one has to pay on loan
taken from financial institutions. Eg., if banks provide loans on 8.5% interest rate to farmers. And if
government provides interest subvention of 1.5%. Then farmers have to pay only 7% interest rate to
bank. Difference will be paid by government as subsidy.
→ Feature:

Page 507 of 719

  Under this scheme, short term agriculture loan upto Rs. 3 lakh is available to farmers engaged in
Agriculture and other allied activities including Anima l Husbandry, Dairying, Poultry, fisheries etc. at
rate of 7% per annum and additional 3% subvention is also given to farmers for prompt and timely
repayment of loans. Therefore, if farmer repays his loan on time, he gets credit at rate of 4% p.a. This
support, given through financial institutions, is 100% funded by Centre, and is also 2 nd largest scheme
of Department of Agriculture and Farmers’ Welfare as per budget outlay and coverage of beneficiaries.
Nodal agency: NABARD, and RBI.
→ Fact:
 Other schemes for interest subvention: Kisan Credit Card, Agri Market Infrastructure Fund (provide
subsidized loans to State, UT), PM Fasal Bima Yojana.
 Farmers Producer Organisation (FPO):
→ What:
 It is one type of PO where members are farmers. Small Farmers’ Agribusiness Consortium (SFAC) is providing
support for promotion of FPOs. PO is generic name for organization of producers of any produce, e.g.,
agricultural, non-farm products, artisan products, etc. FPOs are voluntary organizations controlled by their
farmer-members who actively participate in setting their policies and making decisions.
→ Feature:
 FPOs are open to all persons able to use their services and willing to accept responsibilities of membership,
without gender, social, racial, political or religious discrimination. FPOs operatives provide education and
training for their farmer-members, elected representatives, managers, and employees so that they can
contribute effectively to development of their FPOs.
→ Performance:
 FPOs in Gujarat, Maharashtra, Madhya Pradesh, Rajasthan and some other States have shown encouraging
results and have been able to realize higher returns for their produce. For example, tribal women in Pali district
of Rajasthan formed one producer company and they are getting higher prices for Custard Apple.
 Meri Policy Mere Hath [2022]:
→ doorstep distribution drive / campaign to deliver crop insurance policies to farmers. to ensure all farmers
are well aware and equipped with all information on their policies, land records, process of claim and
grievance redressal under PMFBY. part of Pradhan Mantri Fasal Bima Yojana(PMFBY). launched by Centre in
all PMFBY implementing States. aimed at motivating all farmers in India to insure their crops. Under this
program, every farmer who has taken insurance under PMFBY will get policy documents at their doorstep.
→ Significance:
 It empowers farmers through crop insurance awareness and by bringing insurance policy to their doorsteps. It
will also help in increasing direct communication between farmers and insurance companies.
 Rythu Bandhu scheme [Telangana] [2018]:
→ What:
 Farmer’s Investment Support Scheme (FISS). Telangana government’s DBT scheme for farmers. welfare program
to support farmer’s investment for 2 crops per year. Provides Rs 5000 per acre, per season (at beginning of crop-
sowing) – to support farm investment twice per year, for both –Rabi and Kharif seasons.
→ Objective:
 to break vicious cycle of rural indebtedness. to incentivise Telangana’s farmers for their day to day work.
→ Eligibility:
 farmer should be resident of Telangana and must own farming land. small and marginal farmers [commercial
farmers are excluded]. farmers who till rented land are excluded.
→ Criticism:
 it ignores landless farmers or tenant farmers.
→ Status:
 Total funds disbursed under this is around Rs 50,000 crore.
→ Significance:
 initial investment needs taken care of. Not to fall farmers into debt trap, breaks cycle of rural indebtedness.
Instills confidence in farmers, enhances productivity & income.
 1st nationwide farm loan waiver was implemented by V.P Singh led government in 1990.
 G33:
→ What:
 Friends of Special Products in Agriculture. coalition of developing countries in regard to agriculture
→ History:
 In 2001, G33 members coordinated during Doha Round of WTO negotiations.
→ Feature:
 G33 group has defensive concerns regarding agriculture in relation to WTO negotiations. G33 seeks to limit
degree of market opening required of developing countries.
→ Demand:

Page 508 of 719

  G33 group supports creation of special products exemption, which would allow developing countries to exempt
certain products from tariff reductions. G33 group supports creation of special safeguard mechanism which
would permit tariff increases in response to import increase. In global rules of agriculture, include foodgrain
procurement from farmers at MSP & their distribution at subsidized rates to poor. And, this should not be
counted as trade distorting subsidies.
→ India: member.
 2021 WTO report on world agricultural trade:
→ Agricultural Produce ranking: EU (top), USA (2 nd ), Brazil, China, India (9 th ). India entered top 10 list of
countries exporting agricultural produce. India is 3rd largest cotton exporter. India is 4th largest cotton
importer. India lagged behind in value-added contribution to world agri exports
 2021 NCRB report on Suicides among farm workers:
→ Suicide by agricultural labourers increases. About 10,000 farmers died by suicide in 2020. Suicide worst –
Maharashtra.
 Mahila Kisan Sashaktikaran Pariyojana (MKSP) [2011]:
→ What:
 launched by Ministry of Rural Development. specific for women farmer. recognizes identity of “Mahila” as
“Kisan”. to improve present status of women in Agriculture. to enhance opportunities available to empower
women in Agriculture. to build capacity of women in agro-ecologically sustainable practices. To empower
women by making systematic investments to enhance their participation and productivity, as also create
sustainable livelihoods of rural women. sub scheme of Deendayal Antyodaya Yojana – National Rural Livelihoods
Mission (DAY-NRLM).
→ Implementation:
 This program is implemented in project mode through State Rural Livelihoods Mission (SRLM) as Project
Implementing Agencies.
→ Funding:
 60:40. 90:10 for North Eastern States.
→ Focus:
 Capacity building to adopt sustainable climate resilient agro-ecology and eventually create pool of skilled
community professionals.
 PM-Kisan Samman Nidhi [2018]:
→ What:
 Central Sector scheme with 100% funding from Government of India.
→ Feature:
 Under this scheme, income support of 6,000/- per year in 3 equal installments will be provided to all land holding
farmer families. Definition of family for this scheme is husband, wife and minor children. [In 2019, criteria of
combined land holding / ownership of upto 2 hectares has been removed]. State Government and UT
administration will identify farmer families which are eligible for support as per this scheme guidelines. Fund will
be directly transferred to bank accounts of beneficiaries. There are various Exclusion Categories for this scheme.
→ Scheme Exclusion:
 Beneificiaries of higher economic status shall not be elligible for benefit under this scheme, such as: All
Institutional Land holders; Wealthy farmers like - Income Tax payers; professionals like - Doctors, Engineers,
Lawyers, Chartered Accountants etc; some categories of pensioners. …
→ States’ similar programmes:
 Bhavantar Bhugtan Yojana - MP. Rythu Bandhu scheme - Telangana. Krushak Assistance for Livelihood and
Income Augmentation (KALIA)- Odisha.
→ PM-KISAN vs Rythu Bandhu:
 Rythu Bandhu: based on anticipated input expenditure for each acre of land. no restriction on number of acres
owned by farmer. PM-KISAN: provides support only to family and not to farm units.
 Biotech-Kisan [2017]:
→ What:
 Biotech-Krishi Innovation Science Application Network. scientist-farmer partnership scheme for agriculture
innovation. farmer-centric scheme / programme for farmers. developed by and with farmers under Department
of Biotechnology, Ministry of Science and Technology.
→ Aim:
 understand local problems of farmers and provide scientific solutions to those problems. connect science
laboratories with farmers to find out innovative solutions and technologies to be applied at farm level.
→ Significance:
 pan-India program. stimulates entrepreneurship and innovation in farmers and empowers women
farmers. identifies and promotes local farm leadership in both genders, so as to develop science-based farming
besides facilitating transfer of knowledge to farmers.
 Pradhan Mantri Fasal Bima Yojana (PMFBY) [2016]:

Page 509 of 719

 → What:
 Central government’s flagship crop insurance scheme. insures farm losses against unwanted weather events.
Farmers pay 1.5-2% of premium while rest are borne by centre and State government. Central scheme
implemented by State agriculture departments as per central guidelines. administered by Ministry of Agriculture
and Farmers Welfare.
→ Objective:
 Provide insurance coverage and financial support to farmers. stabilise income of farmers. reduce premium
burden on farmers. settlement of crop assurance claim. adopt innovative and modern agricultural practices.
flow of credit to agriculture sector.
→ Feature:
 It is in line with One Nation – One Scheme theme i.e. it merged schemes of: National Agricultural Insurance
Scheme (NAIS), Modified National Agricultural Insurance Scheme (MNAIS). PMFBY includes Restructured
Weather Based Crop Insurance Scheme (RWBCIS).
 National Crop Insurance Portal (NCIP) is only source of enrolment for PMFBY, on which farmer applications from
various designated sources including banks / financial institutions are entered.
→ Coverage:
 all Food crops. all Oilseed crops. Horticultural crops. Commercial crops.
→ Premium [to be paid by farmers]:
 2% - for all Kharif crops. 1.5% - for all rabi crops. 5% - for annual commercial and horticultural crops.
→ PMFBY 2.0 (overhauled PMFBY):
 Completely Voluntary: Enrolmentis completely voluntary for all farmers. Limit to Central Subsidy: Cap on
Centre’s premium subsidy. More Flexibility to States: flexibility to States / UTs to implement PMFBY. Penalising
Pendency: If States do not release their share in time, they would not be allowed to participate in next season.
ICE Activities: Mandatory for Insurance companies to spend part of premium collected on: Information activities,
Communication activities, Education activities.
→ Performance [as of now]:
 PMFBY scheme has insured about 30 crore farmer applications. About INR 95,000 crores claims have been paid
as against INR 20,000 crore farmers’ share.
→ Criticism:
 Since beginning, farmers, especially from Maharashtra, have criticised PMFBY scheme for many reasons. One of
main arguments is that PMFBY helps insurance companies more than farmers.Farm leaders claim insurance
companies have made large gains at behest of public exchequer, farmers. Delayed payouts, denial of claims are
other common complaints against insurance companies. Insurance companies were also blamed for not
conducting enough crop cutting experiments (CCE), which measure total loss experienced by farmers.
→ Similar crop insurance schemes of States:
 Some States opted out of PMFBY because they felt that claims paid out by insurance companies are much lesser
than gross premium (GP) collected by them. This has implications for government finances because farmers’
contribution to GP is very small i.e. it is States and Centre that spend substantial sums on premium subsidies.
That is, lower claims than premium paid. Thus, those States started their own crop insurance schemes: Bihar
Rajya Fasal Sahayata Yojana (BRFSY) [Bihar], Bangla Shashya Bima (BSB) [West Bengal], YSR Free Crop Insurance
Scheme [Andhra Pradesh]. Gujarat, Telangana, Jharkhand also opted out of PMFBY scheme.
 Soil Health Card (SHC) Scheme:
→ What:
 SHC is handed over to farmer for each of his holdings. Launched by Ministry of Agriculture and Farmers’ Welfare.
→ Objective:
 Soil nutrient status of farmer’s holding is provided to him. Advise farmer on: dosage of fertilizers, soil
amendments, to maintain soil health in long run.
→ Feature:
 Soil Testing Labs – at village level. skill development. employment generation
→ Cooperation:
 youth having agriculture education. Women SHGs. FPOs etc.
→ Significance:
 Analysis of soil composition. Soil remedial steps for improvement of soil nutrients. Creation of jobs for agrarian
youth.
→ SHC:
 What:
• Card having printed report about status of soil with respect to 12 parameters.
 Feature:
• Contains status of soil with respect to 12 parameters, some are: Macro nutrients: Nitrogen (N), Phosphorus
(P), Potassium (K); Micro nutrients: Iron (Fe), Zinc (Zn), Manganese (Mn), Copper (Cu); Physical parameters:
pH, Organic Carbon (OC); Secondary nutrients: Sulphur (S).
Page 510 of 719
  Benefit:
• fertilizer recommendations. organic manure recommendations.
 PM-KUSUM Scheme [2019]:
→ What:
 Pradhan Mantri Kisan Urja Suraksha evem Utthan Mahabhiyan Scheme. initiative of Ministry of New and
Renewable Energy (MNRE). scheme for farmers for installation of: solar pumps, grid connected solar, renewable
power plants.
→ Objective:
 to provide financial security and water security to farmers. to add solar and renewable capacity.
→ Features:
 Solar water pumps will be distributed amongst farmers - grid as well as non-grid pumps. Pumps will be installed
where grid is available (including rural) along with solarisation of existing pumps with central subsidiy, State
subsidy and farmer’s contribution. It will include feeder level solarisation. Pumps will be installed off-grid to aid
irrigation needs of farmers in rural. Farmers can sell surplus solar power generated off-grid to DISCOMS to earn
income.
→ Implementation:
 MNRE’s State Nodal Agencies (SNA) will coordinate with States/ UTs, Discoms, farmers
→ Benefits:
 provides day-time reliable source of power for irrigation activities. increases farmers income. Stable and
continuous source of income to rural landowners by utilisation their dry/uncultivable land. In case solar power
projects are set up in cultivated fields, farmers can continue to grow crops because solar panels will be installed
above minimum height. Save expenditure on buying diesel for running diesel pumps. Prevention of pollution
from running diesel pumps. reliable source of irrigation through solar pumps.
 3 Farm laws 2020 (repealed):
→ What:
 Farmers Produce Trade and Commerce (Promotion and Facilitation) Act, 2020:
• To allow trade in agricultural produce outside existing APMC mandis.
 Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020:
• To provide framework for contract farming.
 Essential Commodities (Amendment) Act, 2020:
• To remove commodities such as cereals, pulses, oilseeds, edible oils, onion, potato from list of essential
commodities.
 “Formation and Promotion of 10,000 Farmer Producer Organizations (FPOs)” [2021]:
→ What:
 GOI one Central Sector Scheme to form and promote 10,000 new FPOs till 2027 -28. Under this scheme,
formation and promotion of FPO is based on Produce Cluster Area approach and specialized
commodity-based approach. While adopting cluster-based approach, formation of FPOs will be
focussed on “One District One Product” for development of product specialization.
→ Significance:
 It will leverage economies of scale, reduction of cost of production and enhancing farmers’ incomes
thus playing major role towards increasing income of farmers.
 Protection of Plant Varieties and Farmers’ Rights Act, 2001:
→ What:
 PPV&FR Act, 2001. legislation enacted by adopting sui generis system. It is in conformity with International Union
for Protection of New Varieties of Plants (UPOV) [1961]. It recognizes contributions of both - commercial plant
breeders, and farmers - in plant breeding activity. It also provides to implement TRIPs to support specific socio-
economic interests of all stakeholders - private, public sectors, research institutions, resource-constrained
farmers.
→ Objectives:
 To establish effective system for protection of plant varieties, rights of farmers, rights of plant breeders. To
establish effective system to encourage development of new varieties of plants. To stimulate investment for
research and development both in public & private sector for development of new plant varieties. Facilitate
growth of seed industry in India [ensuring availability of high-quality seeds, planting material to farmers].
→ Feature:
 Rights:
• Breeders’ Rights:
 Breeders will have exclusive rights to produce, sell, market, distribute, import or export protected
variety.
 Breeder can appoint agent / licensee and may exercise for civil remedy in case of infringement of rights.
• Researchers’ Rights:

Page 511 of 719

  Researchers can use any of registered variety under this PPV&FR Act, 2001 for conducting experiment
or research.
• Farmers’ Rights:
 Farmer who evolved or developed new variety is entitled for registration and protection.
 Farmer can save, use, sow, re-sow, exchange, share or sell his farm produce including seed of variety
protected under this PPV&FR Act, 2001.
 But, farmer shall not be entitled to sell branded seed of variety protected under this PPV&FR Act, 2001.
 Farmers are eligible for recognition and rewards for conservation of Plant Genetic Resources of land
races and wild relatives of economic plants
 Compensation to farmers for non-performance of variety.
 Farmers shall not be liable to pay any fee in any proceeding before PPVFR Authority or Registrar or
Tribunal or High Court under this Act.
 International Treaty on Plant Genetic Resources for Food and Agriculture (ITPGRFA) (2001):
→ What:
 It is also known as International Seed Treaty or Plant Treaty. It is one comprehensive international agreement in
harmony with Convention on Biological Diversity, which aims at guaranteeing food security through
conservation, exchange and sustainable use of world's plant genetic resources for food and agriculture (PGRFA),
fair and equitable benefit sharing arising from its use, as well as recognition of farmers' rights.
→ Aim:
 Recognizes contribution of farmers to diversity of crops. Provides access to plant genetic materials. Ensures
sharing of benefits. Enables sharing of 64 of our most important crops through easily accessible global pool of
genetic resources.
→ Feature:
 It is one major legally binding international agreement to conserve, use and manage plant genetic resources. It
was adopted by UNFAO in 2001.
→ India:
 India is party to it.
 One Nation One Fertiliser:
→ What:
 It is one scheme of GOI under which fertilisers should be sold under one single brand name of “Bharat”
irrespective of manufacturer company. It is a scheme to ensure affordable quality fertiliser of Bharat
brand to the farmers.
→ Why:
 To bring about uniformity in fertiliser brands across India.
→ Government’s argument for introducing this scheme:
 MRP of urea is currently fixed by government, which compensates companies for higher cost of manufacturing
or imports incurred by them. Companies cannot avail subsidy if they sell at MRPs higher than indicated by
government. Through Fertiliser (Movement Control) Order, 1973, government also decides where they can sell.
 When government is spending vast sums of money on fertiliser subsidies, deciding where and at what price
companies can sell, Govt. would want to take credit and send that message to farmers.
→ Drawbacks:
 It will disincentivize fertiliser companies from undertaking marketing and brand promotion activities.
 Currently, in case of any bag or batch of fertilisers not meeting required standards, blame is put on company.
But now, that may be passed on fully to government.
→ Status:
 In 2022, Ministry of Chemicals and Fertilizers announced that it will implement One Nation One
Fertiliser by introducing one single brand for fertilisers and logo under fertiliser subsidy scheme named
Pradhan Mantri Bhartiya Janurvarak Pariyojana (PMBJP). And GOI issued order:
• directing all companies to sell their products under one single brand name of ‘Bharat’.
• that all fertiliser bags, whether containing urea or di-ammonium phosphate (DAP) or muriate of potash
(MOP) or NPK will sport brand name ‘Bharat Urea’, ‘Bharat DAP’, ‘Bharat MOP’, ‘Bharat NPK’ irrespective of
company / manufacturers (private or public).
• that single brand name and logo of Pradhan Mantri Bhartiya Janurvarak Pariyojana (PMBJP) will have to be
displayed on bag. [because central government grants subsidies annually to fertiliser companies under
PMBJP].
 In 2022, GOI launched Bharat Urea Bag.
 PM Promotion of Alternate Nutrients for Agriculture Management Yojana (PM PRANAM):
→ What:
 GOI plans to introduce this scheme to reduce use of chemical fertilisers in India by incentivising States. GOI
proposed this PM PRANAM scheme during National Conference on Agriculture for Rabi Campaign - 2022. This
scheme is in line with GOI’s focus on promoting balanced use of fertilisers or alternative fertilisers. This proposed

Page 512 of 719

 scheme intends to reduce subsidy burden on chemical fertilisers, which is expected to increase to Rs. 2.25 lakh
crore in 2022-23, which is 39% higher than 2021-22’s figure of Rs. 1.62 lakh crore.
→ Feature:
 No separate budget: This scheme will not have separate budget and will be financed by “savings of existing
fertiliser subsidy” under schemes run by Department of Fertilisers.
 50% subsidy savings will be passed on as grant to State that saves money. 70% of grant provided under this
scheme can be used for asset creation (adoption of alternate fertilisers at village, block, and district levels). 30%
grant money can be used for incentivising farmers, panchayats, FPOs, SHGs that are involved in reduction of
fertiliser use and awareness generation.
 GOI will compare State’s increase or reduction in urea in particular year, to its average consumption of urea
during last 3 years. Data available on Integrated Fertilizer Management System (iFMS) - Fertiliser Ministry’s
dashboard, will be used for this purpose.
 “What’s next for Indian agri-tech?” [one Agritech report]:
→ One Agritech report released by FSG (one global nonprofit consulting firm) in 2022.
→ Finding:
 Agri-tech startups are driving India’s agri-tech innovations and investment story with significant private equity
inflows.
 Areas of focus are market linkages, agri-fintech, farm management software, remote sensing and advisory, and
farm automation.
 Technology has irreversibly disrupted traditional agricultural value chain – from how farmers access information
and inputs to how they grow and sell their produce.
 Pradhan Mantri Bharatiya Jan Urvarak Pariyojana / One Nation One Fertiliser Scheme [2022]:
→ What:
 A new scheme for farmers under which companies mus t market all subsidised fertilisers under a single
brand 'Bharat'. It was launched in 2022 by PM Modi.
→ Why:
 The rationale is that since fertilizers of a particular category must meet the nutrient -content
specifications of the Fertilizer Control Order (FCO), there is no product differentiation among different
brands for each type of fertilizer.
 Brand preferences by farmers have resulted in fertilizer-supply delays to farmers and an extra burden
on the exchequer due to increased freight subsidies needing to be paid for the long -distance crisscross
movement of fertilizers.
→ Feature:
 Under it, fertilizer companies must market all subsidised fertilisers under a single brand ‘Bharat’.
 Under this scheme, India will have a common bag design across India like Bharat urea, Bharat DAP,
Bharat MOP, Bharat NPK, and so on.
→ Drawbacks:
 It will disincentivise fertiliser companies from undertaking marketing and brand promotion activities.
 Blame on government: Currently, in case of any bag or batch of fertilisers not meeting the required
standards, the blame is put on the company. But now, that may be passed on fully to the government .
 PM Kisan Samman Sammelan 2022:
→ It was inaugurated by PM Modi in 2022. Kisan Sammelan is a means to make the lives of farmers easier, boost their
capability and promote advanced agricultural techniques.
 Pradan Mantri Sammridhi Kendra [2022]:
→ In 2022, PM Modi inaugurated more than 600 Pradan Mantri Sammridhi Kendras. These Kendras are sales centres
for fertilizer, and also a mechanism for establishing a deep bond with the farmers of India.
 Indian Agricultural Research Institute (IARI):
→ IARI, commonly known as the Pusa Institute, is India's national institute for agricultural research, education and
extension. The name Pusa Institute is derived from the fact that the institute was originally located in Pusa, Bihar as
the Imperial Institute of Agricultural Research in 1911. It was then renamed as the Imperial Agricultural Research
Institute in 1919 and following a major earthquake in Pusa, it was relocated to Delhi in 1936. The current institute in
Delhi is financed and administered by the Indian Council of Agricultural Research (ICAR). The IARI was responsible for
the research leading to the "Green Revolution in India" of the 1970s.
Value Addition:
 Producer Organisation (PO):
→ PO is one legal entity formed by primary producers, viz. farmers, milk producers, fishermen, weavers, rural
artisans, craftsmen. PO can be producer company, cooperative society or any other legal form which
provides for sharing of profits / benefits among members. In some forms like producer companies,
institutions of primary producers can also become member of PO.
 India observes - Crop Insurance Week.
 International Day of Rural Women:

Page 513 of 719

 → celebrated on October 15. every year. This day is dedicated to millions of women living in remote, rural
places. celebrates achievements and contributions of these rural women towards rural development and
agriculture.
 Weather Based Crop Insurance Scheme (WBCIS):
→ to mitigate hardship of insured farmers against likelihood of financial loss on account of anticipated cr op
loss resulting from adverse conditions of weather parameters like rainfall, temperature, frost, humidity
etc. India launched Restructured Weather Based Crop Insurance Scheme (RWBCIS), 2016.
 Swaminathan Commission [2004]:
→ What:
 National Commission on Farmers (NCF). MS Swaminathan – chairman.
→ Aim:
 To come up with system for sustainability in farming system, make it more profitable, cost competitive in farm
commodities. recommend measures for credit and other marketing steps.
→ Its observations:
 Farmers need assured access to and control over basic resources of farming. These include land, water,
fertilizers, pesticides, credit, crop insurance. Knowledge of farming technology and markets is also key. Farmers’
concerns and other agriculture-related issues must be implemented in concurrent list, to make it high priority
for both States and central governments.
→ Recommendations:
 Distribute ceiling-surplus and wasteland among farmers. prevent non-agricultural use of farmland. secure
grazing rights, seasonal forest access to forest tribals. Establish National Land Use Advisory Service, which would
link land use decisions with ecological and marketing factors of season and geography-specific basis. Reform
irrigation resources and its distribution among farmers. Use rainwater harvesting, water level recharging to
increase water supply. Spread outreach of institutional credit by reducing crop loan interest rates. provide
moratorium on debt recovery, agricultural risk fund, separate Kisan Credit Card for women farmers. To address
growing farmer suicides, provide affordable health insurance at primary health centres in rural areas. Extension
of national rural health mission to suicide-prone areas. Restructuring of microfinance policies, covering all crops
by insurance and social security net for support. Give farmers MSP at 50% profit above cost of production
classified as C2 by Commission for Agricultural Costs and Prices (CACP).
 Asymmetric shock:
→ When something unexpected happens that affects one economy (or part of economy) more than rest. This
can create big problems for policymakers if they are trying to set macroeconomic policy that works for
both - area affected by shock and unaffected area. For instance, some economic areas may be oil exporters
and thus highly dependent on price of oil, but other areas are not. If oil price decreases, oil -dependent
area would benefit from policies designed to boost demand that might be unsuited to needs of rest of
economy. This may be constant problem for those responsible for se tting interest rate.
 Garnishment / wage garnishment:
→ Condition / situation when money is legally withheld from one party and sent to another party. legal
process that instructs 3rd party to deduct payments directly from debtor’s wage or bank account. Typic ally,
3rd party is debtor’s employer and is known as garnishee.
Glossary:
 Agroecology:
→ Agroecology is sustainable farming that works with nature. It is one academic discipline that studies
ecological processes applied to agricultural production systems. Bringing ecological principles to bear can
suggest new management approaches in agroecosystems. Term is often used imprecisely, as term can be
used as science, movement, or agricultural practice. Agroecologists study variety of agroecosystems. Field
of agroecology is not associated with any one particular method of farming, whether it be organ ic,
regenerative, integrated, or industrial, intensive or extensive, although some use this name specifically for
alternative agriculture.
Question:
 Accelerated Irrigation Benefits Programme (AIBP) was launched in 1996 as central assistance programme, with aim to
accelerate creation of irrigation potential. Command Area Development (CAD) programme was initiated in 1974-75 with
view to bridging gap between potential created and its utilisation and optimising agricultural productivity through better
management of land and water use in command areas served by selected major and medium irrigation projects.
 In India after its liberalization of economic policies in 1991, share of agriculture in GDP decreased, share of India’s exports
in world trade increased, FDI inflows increased, India’s foreign exchange reserves increased enormously.
 Share of agriculture in GDP increased to 19.9% in 2020-21 from 17.8% in 2019-20. Last time contribution of agriculture
sector to GDP was at 20% was in 2003-04. India is world's largest producer of milk, jute, spice. China is world's largest
producer of tea, rice - India comes 2nd in both.
 Account for the use of chemical pesticides, insecticides and fertilizers in Indian agriculture and its impact on human
health. 10M
Mains Link:
Page 514 of 719
  Discuss the role of technology in agrarian change in India. (10M)
 Discuss the Fertilizer woes in Indian agriculture. Do you think Indian farmers can reduce urea use by half by 2022?
Comment.
 Sikkim is the first ‘Organic State’ in India. What are the ecological and economical benefits of an Organic State? (UPSC
Mains 2018)
 Discuss the Fertilizer woes in Indian agriculture. Do you think Indian farmers can reduce urea use by half by 2022?
Comment.
 Discuss the concerns associated with the implementation of AgriStack.

INTERNATIONAL SOLAR ALLIANCE (ISA) [2015]

News:
 2020:
→ FICCI and ISA organize 1 st World Solar Technology Summit.
 2021:
→ Meeting of ISA general assembly held.
 Agenda:
• operationalisation of OSOWOG initiative (One Sun, One World, One Grid)
• partnership with Global Energy Alliance (GEA) [to scale up technical and financial support to LDCs and Small
Island Developing States (SIDS)].
→ USA joins ISA.
→ UNGA confers Observer Status to ISA.
 Significance:
• India says this UN decision would provide for cooperation between ISA and UN that would benefit global
energy growth and development.
 2022:
→ Nepal becoms 105th country to sign Framework Agreement of ISA – agreement to join ISA.
→ In his capacity as the President, International Solar Alliance, Shri Raj Kumar Singh, Minister of Power and New &
Renewable Energy, India inaugurates 5th Assembly of ISA. [India holds the office of the President of the ISA Assembly
(India was re-elected to the office of the President of the ISA Assembly), with the France as Co-President].
→ ISA assembly approves the ‘Solar Facility’, a payment guarantee mechanism which is expected to stimulate
investments into solar through 2 financial components - Solar Payment Guarantee Fund and Solar Insurance Fund.
About:
 What:
→ ISA is an alliance of 123 signatory countries, most being sunshine countries, which lie either completely or partly
between the Tropic of Cancer and the Tropic of Capricorn. ISA is a treaty-based inter-governmental organization.
Countries that do not fall within the Tropics can join the alliance and enjoy all benefits as other members, with the
exception of voting rights.
→ coalition of solar resource rich countries (most being sunshine countries) lying fully or partially between
Tropic of Cancer and Tropic of Capricorn to specifically address energy needs by harnessing solar energy
→ alliance of about 120 countries initiated by India, to mobilise efforts against climate chan ge through
deployment of solar energy solutions
→ launched jointly by India and France
→ India-led
→ ISA is an international organisation with 110 Member and Signatory countries.
 Estd:
→ Paris Declaration [2015] establishes ISA as alliance dedicated to promotion of solar energy among its
member countries. This initiative was 1st proposed by Indian PM Modi in a speech in 2015 at Wembley Stadium,
United Kingdom, in which he referred to sunshine countries as Suryaputra ("Sons of the Sun"). ISA initiative was
launched by Modi at the India Africa Summit, and a meeting of member countries ahead of the 2015 United
Nations Climate Change Conference in Paris in 2015. The framework agreement of the International Solar
Alliance opened for signatures in Marrakesh, Morocco, in 2016.
 Secretariat:
→ Gurugram, Haryana.
 Need:
→ Solar is key source of affordable and reliable energy.
→ conservation of environment
 Goal:
→ Primary objective is to work for efficient consumption of solar energy to reduce dependence on fossil fuels.
→ ISA’s mission is to unlock USD 1 trillion of investments in solar by 2030 while reducing the cost of the
technology and its financing.
→ target of 1 TW (1000 GW) of solar energy by 2030.

Page 515 of 719

 → Mobilisation of investment of about USD 1000 billion into solar energy by 2030.
→ enable full ecosystem for availability and development of technology, economic resources, development
of storage technology, mass manufacturing, mass innovation
 Membership:
→ All members of UN can join.
 ISA Assembly:
→ apex decision-making body of ISA, where each Member Country is represented.
→ It meets annually at the ministerial level at the ISA’s seat.
→ main decision-making body of ISA
→ decides on administrative, financial and program -related issues.
→ each ISA member country is represented in it.
→ meets annually
→ headquartered - Gurugram, India
 Function:
→ ISA brings together countries with rich solar potential to create global demand, thereby reducing prices
through bulk purchase
→ facilitating deployment of existing solar technologies
→ promoting collaborative solar R&D
→ capacity building.
→ It works with governments to improve energy access and security worldwide and promote solar power as
a sustainable way to transition to a carbon -neutral future.
→ It promotes the use of solar energy in the Agriculture, Health, Transport and Power Generation sectors.
→ ISA member countries are driving change by enacting policies and regulations, sharing best practices,
agreeing on common standards, and mobilising inv estments. Through this work, ISA has identified and
designed and tested new business models for solar projects; supported governments to make their energy
legislation and policies solar-friendly through Ease of Doing Solar analytics and advisory; pooled de mand
for solar technology from different countries; and drove down costs; improved access to finance by
reducing the risks and making the sector more attractive to private investment; increased access to solar
training, data and insights for solar engineers and energy policymakers.
→ ISA is partnering with multilateral development banks (MDBs), development financial institutions (DFIs),
private and public sector organisations, civil society, and other international institutions to deploy cost -
effective and transformational solutions through solar energy, especially in the least Developed Countries
(LDCs) and the Small Island Developing States (SIDS).
 Feature:
→ action-oriented organisation
→ ensuring availability and access to cheap and improved solar technology
→ increasing % of solar energy in countries’ national energy mix
→ encouraging innovation
→ ensuring funding for solar projects
→ developing regulations
 6 Programs:
→ Solar Applications for Agricultural Use
→ Affordable Finance at Scale
→ Mini Grids
→ Solar Rooftops
→ Solar E-mobility & Storage
→ Large-Scale Solar Parks.
 Significance:
→ Reduced cost of technology would enable ambitious solar energy programmes.
→ Solar is key source of affordable and reliable energy.
→ towards achieving universal energy access goal (SDG 7).
→ Conservation of environment.
 Achievement:
→ ISA now has formed projects in Bhutan, Papua New Guinea, Senegal which shows impact that India and
France make together in these 3 countries.
→ Important projects under ISA: One Sun One World One Grid (OSOWOG); Solar Technology Application
Resource Centres (STAR-C).
 India:
→ With the signing and ratification of the ISA Framework Agreement by 15 countries in 2017, ISA became the
1 st international intergovernmental organisation to be headquartered in India .
→ India has target of installing 100 GW of solar by 2022 and 300 GW of solar by 2030.
Page 516 of 719
 → India’s contribution to ISA:
 India contributes millions of USD to corpus fund of ISA.
 Indian Renewable Energy Development Agency (IREDA) Limited and Solar Energy Corporation of India (SECI)
contributed funds.
 India keeps 5 acres of land in Gurgaon to house headquarters of ISA.
→ In 2018, India at 1st International Solar Alliance Summit / ISA summit made 10-point action plan for clean
energy / solar energy:
 Ensuring that cheap and improved solar technology is easily available.
 Increasing % of solar energy in countries’ national energy mix.
 Encouraging innovation for development of solutions to problems / challenges.
 Ensuring concessional and risk-free funding for solar projects.
 Developing regulatory aspects and norms to speed up adoption of solar technologies, solutions
 Consultancy support for bankable solar projects in developing nations.
 Ensuring efforts to propagate solar revolution stress on partnerships and assimilation
 Ensuring creation of network of centres of excellence that takes into account local circumstances and factors.
 Ensuring solar energy policies are seen in context of development that will help in achieving SDGs
 Making ISA secretariat strong and professional body.
Note:
 OSOWOG:
→ What:
 One Sun, One World, One Grid
 Green Grids Initiative
 framework for facilitating global cooperation / global ecosystem of interconnected renewable
energy resources that can be easily shared.
 by ISA
 global green energy grid, primarily focusing on solar and wind energy.
 taken up under technical assistance program of World Bank.
→ Origin:
 announced during COP26 by India and UK to tap solar energy and have it travel seamlessly across borders.
→ Objective:
 build global consensus about sharing solar resources among countries of West Asia and South-East Asia.
→ Vision:
 “The Sun Never Sets” (constant at some geographical location, globally, at any given point of time.)
→ Signficance:
 access clean energy at all places.
 need to store energy would be lessen
 viability of solar projects will increase.
 This integration would lead to reduced project costs, higher efficiencies, increased asset utilization for all
participating entities.
 This plan will require only incremental investment because it will not require parallel grid infrastructure due to
working with existing grids.
 attracting investments in renewable energy sources
 economic benefits
 It will allow national renewable energy management centers in India to grow as regional and global management
centers.
 One Sun Declaration:
→ OSOWOG announcement was accompanied by “One Sun Declaration”
→ It states that realising vision of One Sun One World One Grid through interconnected green grids can be
transformational, enabling all of us to meet targets of Paris Agreement to prevent dangerous climate change, to
accelerate clean energy transition, and to achieve SDGs.
→ This declaration is endorsed by many ISA member countries.
 World Solar Technology Summit (WSTS) [2020]:
→ 2020 World Solar Technology Summit (WSTS):
 1st WSTS, organised by FICCI with ISA.
 During this summit, ISA signed 4 agreements, signalling its intent to focus on key areas of solar energy sector.
They are:
• Partnership agreement between Union Ministry of Renewable Energy, World Bank and ISA on One Sun, One
World, One Grid (OSOWOG).
• Partnership between Global Green Growth Institute and ISA on promotion of million solar pumps.
• Memorandum of Understanding between International Institute for Refrigeration, Paris and ISA.
• Partnership agreements on implementation of 47 projects between ISA and NTPC.
Page 517 of 719
  ISA also launched its technology journal - Solar Compass 360.
Mains Link:
 Write a note on One World, One Sun, One Grid initiative.
 Discuss the significance of OSOWOG initiative.

POLLUTION CONTROL
News:
 2022:
→ Centre for Policy Research (a public policy Indian think tank) releases a new series of papers looking into
the institutional structure and capacity of 10 State Pollution Control Boards and 10 Pollution Control
Committees.
About:
 Pollution control in India:
→ Constitutional:
 Article 48A (Protection and improvement of environment and safeguarding of forests and wild life) says that the
state shall endeavour to protect and improve the environment and to safeguard the forests and wild life of the
country.
 Article 51A(g) (Fundamental duties) says that it shall be the duty of every citizen of India to protect and improve
the natural environment including forests, lakes, rivers and wild life, and to have compassion for living creatures;
 Right to a healthy environment is part of Article 21 (Protection of life and personal liberty).
→ Pollution control boards in India:
 History:
• Pollution control boards are established as statutory bodies with powers under Air Act, 1981, Water Act,
1974 and Environmental Protection Act, 1986.
 Why we need efficient pollution control boards:
• North Gangetic belts have one of the most polluted cities and rivers. Of the top 30 polluted cities, 9 lie in
the north Gangetic belt. Yamuna, Damodar and Suvarna Rekha have been marked as biologically dead rivers,
with pollution indicators over 5 times the prescribed limits.
• High fragmentation of industries lacking the ability to monitor pollution control themselves.
• With rapid economic development and a focus on industry-led growth, pollution control becomes non-
negotiable.
• SDG-6 (Sustainable management of water and sanitation), SDG-9 (Sustainable industrialization), SDG-11
(Sustainable cities).
 Issue:
• Subpar performance of pollution control boards in India. Reasons:
 High vacancy rates: With 40% overall vacancies, the situation is particularly dire in Jharkhand, Haryana
and Bihar where vacancies can be over 75%.
 Issues with administration: Lack of full-time administrators creates low efficiency in performance. 53%
of the members are part of polluting agencies themselves (local bodies, industries and PSU) creating a
potential conflict of interest. Frequent leadership transfers create exceptionally low office terms, and
it hinders the development and implementation of long-term plans.
 Low technical expertise: Technical experts constitute less than 7% of member strength (as compared
to the statutory mandate of 50%).
 Poor multi-sectoral coordination.
 Lack of detailed procedure, and quasi-judicial nature creates long-term litigation period.
 Way Forward:
• Methods to improve performance:
 Financial autonomy: By using the polluter pays concept, agencies must give bank guarantees, which can
be forfeited in cases of non-compliance. It can form a significant portion of revenue for SPCBs.
 Fixed terms for top administrators to improve the separation of legislative and executive.
 A detailed procedure, uniform standards and legislation to reduce litigations.
 Specialized recruitment to improve the technical strengths and improve oversight.
 Capacity building of all stakeholders to improve coordination.
 Conclusion:
→ Pollution control is central to ensuring sustainable economic growth without impacting the ecosystems
negatively. Pollution control agencies must not only focus on reducing negative linkages but also aid the
development of positive ones.
Mains link
 Pollution control agencies have failed to live up to their mandate s. Comment. Also, suggest some measures to
improve their performance.

Page 518 of 719

 DISASTER
News:
 2020:
→ Disaster Management Act, 2005 was invoked for 1st time since its enactment after Tsunami, 2004.
→ Under DM Act, 2005, Union Home Ministry issues lockdown orders.
→ Central government includes COVID-19 outbreak as “Notified Disaster” under DM Act, 2005.
 Notified Disaster: Any disaster notified by central govt. (Union Home Ministry) under Disaster
Management Act, 2005
→ Supreme Court held that States are empowered under Disaster Management Act, 2005 to override University Grants
Commission (UGC) exam guidelines in order to protect human lives amid COVID-19 pandemic.
 2021:
→ Invoking Disaster Management Act, 2005, Centre orders States that all liquid Oxygens should be made available to
government and should be used for medical purposes only, with some exception sectors like pharmaceutical, nuclear
energy etc.
→ Union Home Ministry released data on fatalities caused by hydro-meteorological calamities.
 2022:
→ Ministry of Panchayati Raj (MoPR) releases Disaster Management Plan of Ministry of Panchayati Raj (DMP-MoPR).
→ Since March 2020, MHA has been issuing orders and guidelines for containment of Covid-19 under Section 10
Disaster Management Act, 2005.
→ CDRI in partnership with United States Agency for International Development (USAID) commences ICDRI 2022. Heads
of states from CDRI member countries including India attend this conference.
→ GOI approves categorization of CDRI as ‘International Organization’ and signing of Headquarters Agreement (HQA)
with CDRI for granting it exemptions, immunities and privileges under United Nations (Privileges & Immunities) Act,
1947 (Indian Parliament’s Act to give effect to Convection on Privileges and immunities of UN).
 Importance: This move will provide CDRI independent and international legal persona so that it can efficiently
and effectively carry out its functions internationally. This will help CDRI in deputing experts to other countries;
deploying funds globally; making available technical expertise to assist countries; and leveraging international
engagement to foster disaster-resilient infrastructure.
→ UNDRR releases Global Assessment Report on Disaster Risk Reduction 2022 (GAR2022).
→ UNDRR organizes Global Platform for Disaster Risk Reduction, 2022 (GP 2022) (7th session) in Bali, Indonesia, in which
it was highlighted that indigenous peoples’ understanding of disaster risk uses enormous dataset – traditional
knowledge and folklore reaching back many generations. [8th session of Gp will take place in Switzerland in 2025.]
→ Sustainable Ecological & Environmental Development Society (SEEDS), South Asia’s foremost non-profit organisation
working in field of disaster risk reduction and climate change is awarded UN Sasakawa Award 2022 for Disaster Risk
Reduction at 7th Session of Global Platform for Disaster Risk Reduction (GPDRR) 2022 in Bali, Indonesia. One of 3
awardee this 2022 year is Rajib Shaw (Professor at one university in Japan): He has championed multi-hazard
community-based disaster risk reduction in 6 Asian countries, and his work has led to establishment of village-level
community-based working groups.
→ Department of Chemicals and Petro-chemicals (Ministry of Chemicals and Fertilisers) signs MoU with ILO on
International Chemical Safety Cards (ICSC).
→ CDRI accorded independent & international legal entity tag: India signs Headquarter Agreement with CDRI, thereby
according status of one independent and international legal entity to CDRI. This pact will enable CDRI to pursue
functions internationally with all rights, immunities, and privileges, as per United Nations (Privileges and Immunities)
Act, 1947 (Indian Parliament’s Act to give effect to Convection on Privileges and immunities of UN).
→ Post-Disaster Needs Assessment (PDNA) conducted in India: An international framework for assessing losses and
damages in the aftermath of a disaster is now being used to evaluate the financial and social cost of local disasters
in 8 Indian States. The framework helps get recovery and reconstruction efforts right following a disaster. Post-
Disaster Needs Assessment (PDNA) is being done simultaneously in Assam, Himachal Pradesh, Gujarat, Karnataka,
Jharkhand, Maharashtra, Odisha, Meghalaya.
Constitution:
 Concurrent List:
→ Legal basis of DM Act, 2005 is present in Concurrent List of 7 th Schedule of Constitution: Social security
and social insurance; Prevention of extension from one State to another of infectious or contagious
diseases or pests affecting men, animals or plants.
About:
 Chemical accident / Chemical disaster:
→ What:
 Chemical accident is unintentional release of one or more chemical hazard substances which could harm human
health and environment. Such events include fires, explosions, leakages or release of toxic or hazardous
materials that can cause people illness, injury, or disability. Chemical accident can be caused by natural disaster,
or accidental human error, or deliberate move to cause chaos and destructions for personal gain. While chemical
Page 519 of 719
 accidents may occur whenever toxic materials are stored, transported or used, most severe are industrial
accidents, involving major chemical manufacturing and storage facilities.
→ Status of Chemical Disaster Risk in India:
 India witnessed world’s worst chemical (industrial) disaster “Bhopal Gas Tragedy” in year 1984. Bhopal Gas
tragedy was most devastating chemical accident in history, where over 2500 people died due to accidental
release of toxic gas Methyl Iso Cyanate (MIC). Such accidents are significant in terms of injuries, pain, suffering,
loss of lives, damage to property and environment. India continued to witness series of chemical accidents even
after Bhopal had demonstrated vulnerability of India. Only in last decade, 130 significant chemical accidents
reported in India, which resulted into 259 deaths and 563 number of major injured. There are about 1861 Major
Accident Hazard (MAH) units, spread across 298 districts and 25 States & 3 Union Territories, in all zones of India.
Besides, there are thousands of registered and hazardous factories (below MAH criteria) and un-organized
sectors dealing with numerous range of hazardous material posing serious and complex levels of disaster risks.
 As per NDMA, over 130 chemical disasters have taken place in recent past (E.g. Vishakhapatnam disaster
involving benzimidazole; Neyveli boiler disaster, in TN)
→ Initiatives:
 Comprehensive legal / institutional framework exists in India. Number of regulations covering safety in
transportation, liability, insurance and compensations have been enacted in India. Relevant provisions on
chemical disaster management, prevailing in India are: Explosives Act, 1884; Petroleum Act, 1934; Factories Act,
1948; Insecticides Act, 1968; Environment Protection Act, 1986; Motor Vehicles Act, 1988; Public Liability
Insurance Act, 1991; Disaster Management Act, 2005. GOI has further reinforced legal framework on chemical
safety and management of chemical accidents by enacting rules such as MSIHC Rules, EPPR Rules, SMPV Rules,
CMV Rules, Gas Cylinder Rules, Hazardous Waste Rules, Dock Workers Rules. NDMA of India came out with very
specific guidelines on Chemical Disaster Management. Environment Relief Fund (ERF) (under Public Liability
Insurance Act, 1991) to provide relief to victims.
→ Way Forward:
 ILO suggestions: One list of hazardous chemicals and flammable gases should be established, each having
specific quantity.
 Supreme Court (in MC Mehta case, 1986) gave doctrine of absolute liability (meaning factory will be responsible
for giving full compensation in case of disaster whether it was their fault or not).
 Under Environment Protection Act, 1986: Manufacture, Storage and Import of Hazardous Chemicals Rules, 1989;
Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008 for regulating
hazardous substances.
 Hydro-meteorological calamities:
→ flash floods; Cloudburst: Extreme amount of precipitation in short period of time, sometimes accompanied by hail
and thunder, which is capable of creating flood conditions. Cloudbursts can quickly dump large amounts of water;
landslides.
 Disaster Resilience:
→ What:
 Ability of individuals, communities, organisations and states to adapt to and recover from hazards, shocks or
stresses without compromising long-term prospects for development. According to Hyogo Framework for Action
(UNISDR, 2005), disaster resilience is determined by degree to which individuals, communities and public and
private organisations are capable of organising themselves to learn from past disasters and reduce their risks to
future ones, at international, regional, national and local levels.
→ Disaster Resilient Infrastructure:
 Need:
• Sendai Framework on Disaster Risk Reduction (SFDRR) [2015-30] highlights role of improved disaster
resilience of infrastructure as cornerstone for sustainable development. SFDRR includes 4 specific targets
related to loss reduction. They are: Reduce global disaster mortality; Reduce number of affected people;
Reduce direct disaster economic loss; Reduce disaster damage to critical infrastructure.
→ Initiative:
 CDRI [2019]; International Conference on Disaster Resilient Infrastructure (ICDRI).
 Post-Disaster:
→ Assess disaster:
 Post-Disaster Needs Assessment (PDNA):
• What:
 PDNA is a framework that helps get recovery and reconstruction efforts right following a disaster. PDNA
is an international framework for assessing losses and damages in the aftermath of a disaster. National
Disaster Management Authority (NDMA) is the national overseer of PDNAs in India.
Professor Santhosh Kumar of the National Institute of Disaster Management (NIDM) says in
comparison to an ordinary assessment, in a PDNA, the damage to infrastructure and how it impacts the
stock of the economy at the macro-economic level is calculated 1st. He further says this includes a
calculation of the disaster’s impact on GDP, balance of payment, and fiscal budget, and secondly, how
Page 520 of 719
 this affects the flow of revenue to multiple sectors is evaluated. For example, the number of farmers’
income affected per damaged acre of land and the livelihoods lost. Overall, a quantitative assessment
is additionally done on the social and environmental impact of the disaster.
The Indian PDNA manual of 2019 says that PDNA is not a replacement for the current Relief
Memorandum used by States but instead, PDNA adds a recovery and resilience component to disaster
management. That is, Manual Post Disaster Needs Assessment India (Volume - I), published by National
Institute of Disaster Management (NIDM) in 2019, mentions that this methodology (PDNA) should not
be seen as a replacement or substitute for the existing approach which States use for the development
of the Relief Memorandum, and instead should be noted that the methodology (PDNA) treats recovery
and reconstruction following a disaster while building resilience to future events, as a separate and
additional area of disaster management.
PDNA is an internationally accepted methodology for determining the physical damages,
economic losses, and costs of meeting recovery needs after a natural disaster through a government-
led process. E.g. a number of farmers’ income affected per damaged acre of land and livelihoods lost is
calculated.
• Methodology:
 Establishment of PDNA assessment team.
 Training / orientation on PDNA.
 Data collection and validation, draft sectoral reports.
 Consolidation and analysis of sector effects, impact and needs.
 Formulating the recovery strategy.
 Resource mobilization and implementation mechanism.
• Usage:
 PDNA was 1st adopted during the Kerala floods of 2018 and again during the cyclone in Odisha in 2019.
However, until now in 2022, the PDNA assessment was only limited to massive disasters that required
international funding from the World Bank, the Asian Development Bank and the UN, because State
capacities were compromised due to the scale of the disasters. In 2022, PDNA is now being used to
evaluate the financial and social cost of local disasters in 8 Indian States. PDNA is being done
simultaneously in Assam, Himachal Pradesh, Gujarat, Karnataka, Jharkhand, Maharashtra, Odisha,
Meghalaya.
• Funding:
 In India, PDNA will be a State government led activity and funds required should be sourced from the
State with contributions from national ministries.
• Implementation:
 State Revenue / Disaster Management Department will be responsible for the overall organization and
conduct of PDNA. [State Disaster Management Authorities opine that PDNA makes more sense for
States that are flood and cyclone prone whereas droughts should be taken care of by agriculture and
irrigation departments].
• th
15 Finance Commission provision:
 The 15th finance commission report of 2021, for the 1st time, made a provision for recovery and
reconstruction in the national disaster management budget, which is at the core of the PDNA.
• Concern:
 State Disaster Management Authorities’ reaction to PDNAs?
 Sekhar Lukose Kuriakose (a Member Secretary of Kerala State Disaster Management Authority) says
PDNA is a very broad document and a wish list. As PDNA aims to encourage building back better,
sometimes it can have too much idealism. For instance, a civil engineer may want to build bridges
resilient enough for Modified Mercalli Intensity 6 level earthquakes when the region could only be
prone to MMI4 earthquakes.
 GD Tripathi (chief executive officer at Assam Disaster Management Department) says PDNA may not
make a difference in funding as the government will only follow the norms of assistance when
dispersing funds.
 PDNA seems to be not suitable in case of drought disaster, because as a drought is a slow onset disaster
evolving over months or even years, its effects are reduced better through mitigation and
preparedness. [When it comes to drought, the agriculture department, water and irrigation
department must work out strategies for mitigation. PDNA over the impact of droughts is not needed
from the perspective of the disaster department].
• Status:
 Globally, of the 55 PDNAs conducted worldwide since 2008, only 2 droughts — one in Malawi and the
other Marshall Islands in 2016 — were of slow-onset disasters.
 Now the Disaster Management Authorities in India are working towards applying PDNA for all disasters
in India. PDNA is now being done simultaneously in 8 States Assam, Himachal Pradesh, Gujarat,
Karnataka, Jharkhand, Maharashtra, Odisha, Meghalaya.

Page 521 of 719

 • Significance:
 PDNA makes more sense for States that are flood and cyclone prone.
 Helps get recovery and rehabilitation right after a disaster. It adds a recovery and resilience component
to disaster management.
 PDNA aims to encourage building back better.
 PDNA is a holistic recovery programme that promotes equity and inclusion.
• Way Forward:
 In the wake of the recent increase in the frequency of natural disasters due to various reasons like
Global warming, PDNA is a good step forward. But the provision of adequate finances and adequate
training of authorities to carry out PDNA should be taken care of for effective implementation.
 Status:
• An international framework for assessing losses and damages in the aftermath of a disaster is now being
used to evaluate the financial and social cost of local disasters in 8 Indian States. The framework helps get
recovery and reconstruction efforts right following a disaster. Post-Disaster Needs Assessment (PDNA) is
being done simultaneously in Assam, Himachal Pradesh, Gujarat, Karnataka, Jharkhand, Maharashtra,
Odisha, Meghalaya.
 Initiative:
→ UN Office for Disaster Risk Reduction (UNDRR); Global Platform for Disaster Risk Reduction; Hyogo Framework
for Action (HFA) [2005-15]; Sendai Framework for Disaster Risk Reduction (2015 –30).
→ Post-Disaster Needs Assessment (PDNA).
→ Policies / initiatives of India:
 India is signatory to Sendai Framework for Disaster Risk Reduction 2015-30. India is party to International
Strategy for Disaster Reduction (ISDR) of UN. Disaster Management Act, 2005. National Disaster Management
Plan (NDMP) defines roles and responsibilities of stakeholders - Central Ministries/ Departments, State
Governments, UT Administrations, District Authorities, local self governments. National Disaster Management
Services (NDMS) of NDMA. Landslide Risk Mitigation Scheme (LRMS) of NDMA.
→ UNDRR 5 Disaster risk-reduction strategies:
 These below 5 indigenous practices have used traditional knowledge, alongside modern techniques, to help
manage disaster risk. These 5 are:
• Cultural burning:
 Ancient Australian aboriginal techniques to reduce bushfire risk include cultural burning techniques
known as “mosaic burns”. Controlled fires in small areas burn at relatively low temperatures, reducing
undergrowth and dead wood while preserving larger trees and allowing wildlife to escape. These
controlled burnoffs reduce risk of wildfires, and, if they do occur, limit their destructiveness.
• Natural flood management:
 In Nepal and on Tibetan Plateau, communities use age-old traditional forecasting and flood-prevention
methods to limit risks of seasonal flooding. These include planting flood-resistant crops and digging
drainage ditches and moats.
Community-based early warning systems use environmental indicators to identify patterns
associated with onset of flooding. Observations of changes in cloud shapes, rainfall patterns, fauna
activity, wind velocity, star positions and temperatures help anticipate floods and trigger preparations
to minimize their impacts. Locals then take preparatory measures, moving their possessions, livestock
and living areas to higher ground, and stockpiling essentials. In aftermath of floods, traditional remedies
– like using green coconut milk to treat diarrhea, cholera, dysentery – help with recovery, alongside any
modern medical treatments that might be available.
• Resilient sustainable recovery:
 In New Zealand, its traditional Maori knowledge was incorporated into its disaster resilience planning.
Locals worked with NZ government to map environmental and cultural assets, and ensure holistic
recovery. This mapping of traditional heritage areas helped ensure environmental restoration,
biodiversity and future sustainability.
Longer-term outcomes include development of heritage risk models that map risks to
traditional assets and creation of heritage risk alerts that categorize graduated outcomes in terms of
risk exposure.
• Community-based early warning
 Maori traditional knowledge is also used in to integrate community-based early warning systems for
volcanic activity at Mount Ruapehu, NZ, based on observation of changes in flora and animal behaviour,
alongside digital sensors. This approach combines traditional cultural knowledge with modern
techniques, to preserve both traditional cultural values, and physical environmental assets.
Systemic approach to understanding connection between communities and ecosystems is
increasingly being understood within wider political systems.
• Safe areas:

Page 522 of 719

  In Sulawesi, Indonesia, Kailli communities have passed on historical knowledge to provide deeper
understanding of natural hazards. Local language describes range of hazards and their causes: tsunamis,
earthquakes, ground liquefaction resulting from earthquakes. Folksongs recount past experiences of
disasters, and pass on lessons learnt from predecessors. Villages include safe areas, which have always
been used as refuges during seismic events.
 Disaster Management Act, 2005 / DM Act, 2005:
→ What:
 Act to provide for effective management of disasters.
→ Genesis:
 2004 Indian Ocean Tsunami
→ Objective:
 Management of disasters; prevention of danger or threat of any disaster; mitigation or reduction of risk of any
disaster or its severity or consequences; capacity-building; preparedness to deal with any disaster; prompt
response to any threatening disaster situation or disaster; assessing severity or magnitude of effects of any
disaster; evacuation, rescue and relief; rehabilitation and reconstruction.
→ Legality:
 Legal basis of DM Act, 2005 is in aforementioned Concurrent List of Constitution.
→ Function:
 In case of disaster, priority of all authorities under Disaster Management Act, 2005 is to immediately combat
disaster and contain it to save human life. It calls for establishment of National Disaster Management Authority
(NDMA), with Prime Minister as chairperson. It calls Central Government to constitute National Executive
Committee (NEC) to assist NDMA. All State Governments are mandated to establish State Disaster Management
Authority (SDMA).
→ Provision:
 Disaster:
• According to Disaster Management Act, 2005, disaster is defined as catastrophe, mishap (unlucky incident),
calamity or grave occurrence in any areaarising from natural or man made causes, or by accident or
negligencewhich results in substantial loss of life or human suffering or damage to, and destruction of,
property, or damage to, or degradation of, environment,and is of such nature or magnitude as to be beyond
handling capacity of community of that affected area.
 Disaster management:
• According to Disaster Management Act, 2005, disaster managemet is defined as continuous and integrated
process of planning, organizing, coordinating, implementing measures which are necessary or practical for
prevention of danger or threat of any disaster; mitigation or reduction of risk of any disaster or its severity
or consequences; capacity-building; preparedness to deal with any disaster; prompt response to any
threatening disaster situation or disaster; assessing severity or magnitude of effects of any disaster;
evacuation, rescue and relief; rehabilitation and reconstruction.
 National Disaster Management Authority (NDMA):
• DM Act, 2005 mandates (shall) Central Government to establish NDMA. Chairperson – Prime Minister (PM).
• Advisory committee: DM Act, 2005 says NDMA may constitute advisory committee consisting of experts in
field of disaster management, to make recommendations on different aspects of disaster management.
• National Executive Committee (NEC):
 DM Act, 2005 mandates Central Government to constitute NEC to assist NDMA, in performing its
functions.
 Chairperson - Secretary to Government of India in charge of Ministry or Department of Central
Government having administrative control of disaster management (<-Secretary of Union Home
Ministry)
• National plan: DM Act, 2005 mandates NEC to prepare National Plan for disaster management for whole of
country and it shall be approved by NDMA
 State Disaster Management Authority (SDMA):
• DM Act, 2005 mandates every State Government to establish SDMA.
• Chairperson:
 Chief Minister (CM) – for States, UT with legislature except Delhi. Lieutenant Governor (LG) – for Union
territory of Delhi [Chief Minister is vice-chairperson]. Lieutenant Governor (LG) or Administrator – for
UT without legislature.
• Advisory committee:
 DM Act, 2005 says SDMA may constitute advisory committee consisting of experts in field of disaster
management. to make recommendations on different aspects of disaster management.
• State Executive Committee (SEC):
 DM Act, 2005 mandates every State Government to constitute SEC to assist SDMA in performing its
functions. Chairperson – Chief Secretary to State Government

Page 523 of 719

 •State Disaster Management Plan: DM Act, 2005 mandates SEC to prepare State Plan for disaster
management for that State, under guidelines issued by NDMA and it shall be approved by SDMA
 District Disaster Management Authority (DDMA):
• DM Act, 2005 mandates every State Government to establish DDMA for every district in respective State.
Chairperson - Collector / District Magistrate / Deputy Commissioner. Advisory committee: DM Act, 2005
says DDMA may constitute advisory committee consisting of experts in field of disaster management, to
make recommendations on different aspects of disaster management. District Plan: DM Act, 2005 mandates
DDMA to prepare District Plan for disaster management for that District, in line with National Plan and State
Plan, and it shall be approved by SDMA.
 National Institute of Disaster Management (NIDM):
• DM Act, 2005 mandates Central Government to constitute NIDM. Training, study course, programmes
related to disaster management
 National Disaster Response Force (NDRF):
• DM Act, 2005 says NDRF shall be constituted. to response to disaster or disaster situation. General
superintendence, direction and control shall be exercised by NDMA.
 National Disaster Response Fund (NDRF):
• DM Act, 2005 says Central Government may constitute NDRF. for funding any threatening disaster or
disaster situation. Funding: by appropriation by Parliament by law; by any grant from any person or
institution for purpose of disaster management.
 National Disaster Mitigation Fund (NDMF):
• DM Act, 2005 says Central Government may constitute NDMF. for funding projects exclusively for purpose
of mitigation. Funding: by appropriation by Parliament by law;
 Funds in States:
• DM Act, 2005 mandates every State Government to constitute State Disaster Response Fund (SDRF); State
Disaster Mitigation Fund (SDMF); District Disaster Response Fund (DDRF); District Disaster Mitigation Fund
(DDMF).
 Bar of jurisdiction of court:
• Except Supreme Court and High Courts, no other courts shall have jurisdiction to entertain any suit or
proceeding in respect of anything done, action taken, orders made, direction, instruction or guidelines
issued by Central Government, NDMA, State Government, SDMA, DDMA in pursuance of any power
conferred by, or in relation to its functions, by this NMDA Act, 2005.
→ Powers of Centre under DM Act, 2005:
 DM Act, 2005 bestows extensive authority on Central Government and NDMA. Central Government,
irrespective of any law in force, can issue any directions to any authority anywhere in India to facilitate
or assist in disaster management. Importantly, any such directions issued by Central Government and
NDMA must be followed by Union Ministries, State Governments and SDMA. DM Act, 2005
authorises NDMA’s chairperson - Prime Minister to take decisions to deal with it, including reliefs,
measures. Powers of PM and CMs are same under DM law, except in case of Delhi, where Lieutenant-
Governor has power.
→ Powers of States under DM Act, 2005:
 Under DM Act, 2005 States are empowered to take action to prevent deaths due to natural calamities.
States and district authorities can frame their own rules on basis of broad guidelines issued by Ministry
of Home Affairs. Chief Minister may also invoke special powers under DM law for dealing with disaster.
→ Organisations related to Disaster Management:
 NDMA; National Disaster Management Plan (NDMP); SDMA; DDMA.
→ Relevance in Covid-19 pandemic:
 Covid-19 is 1st pan India biological disaster being handled by legal and constitutional institutions of
country. Covid-19 lockdowns has been imposed under Disaster Management Act, 2005. Under DM Act,
2005, States and district authorities can frame their own rules on basis of broad guidelines issued by
Union Home Ministry.
 National Disaster Management Authority (NDMA) [2006]:
→ What:
 apex statutory body for Disaster Management in India. NDMA is mandated to lay down policies, plans and
guidelines for Disaster Management. India envisions the development of an ethos of Prevention, Mitigation,
Preparedness and Response.
→ Functions:
 lay down policies, plans and guidelines for Disaster Management [to ensure timely and effective response to
disasters]. Approve National Plan. Approve plans prepared by Ministries or Departments of Government of India
in accordance with National Plan. Lay down guidelines to be followed by State Authorities in drawing up State
Plan. Lay down guidelines to be followed by Ministries or Departments of Government of India for prevention
of disaster or mitigation of its effects in their development plans and projects. Coordinate enforcement and

Page 524 of 719

 implementation of policy and plans for disaster management. Recommend provision of funds for purpose of
mitigation. Provide support to other countries affected by major disasters as may be determined by Central
Government. Take measures for prevention of disaster, or mitigation, or preparedness and capacity building for
dealing with threatening disaster situations or disasters. Lay down broad policies and guidelines for functioning
of National Institute of Disaster Management.
Note:
 UN Office for Disaster Risk Reduction (UNDRR) [1999]:
→ What:
 UNDRR was created in 1999 to ensure implementation of International Strategy for Disaster Reduction (General
Assembly (GA) resolution) UNDRR (formerly UNISDR – UN International Strategy for Disaster Risk Reduction) is
part of UN Secretariat and it supports implementation & review of Sendai Framework for Disaster Risk Reduction
adopted by 3rd UN World Conference on Disaster Risk Reduction in 2015 in Sendai, Japan.
→ Vision:
 UNDRR’s vision is anchored on 4 priorities for action set out in Sendai Framework.
→ Composition:
 UNDRR is led by one UN Special Representative of Secretary-General for Disaster Risk Reduction (SRSG) and has
over 100 staff located in its headquarters in Geneva, Switzerland, 5 regional offices (Africa: Nairobi, Americas:
Panama City, Arab States: Cairo, Asia-Pacific: Bangkok, Europe: Brussels) and other field presences in Addis
Ababa (Ethiopia), Almaty, Bonn, Incheon, Kobe, New York-UN Headquarters, Rio de Janeiro and Suva.
→ Function:
 UNDRR coordinates international efforts in Disaster Risk Reduction (DRR) and it reports on implementation of
Sendai Framework for Disaster Risk Reduction. It convenes biennial Global Platform on Disaster Risk Reduction.
→ Significance:
 UNDRR brings governments, partners and communities together to reduce disaster risk and losses to ensure
safer, more sustainable future. UNDRR is UN focal point for disaster risk reduction. UNDRR oversees
implementation of Sendai Framework 2015-2030, supporting countries in its implementation, monitoring and
sharing what works in reducing existing risk and preventing creation of new risk.
 National Cyclone Risk Mitigation Project (NCRMP):
→ Aim:
 address cyclone risks in country. undertake suitable structural / non-structural measures to mitigate effects of
cyclones in coastal States and Union Territories (UTs) of India.
→ Implementation:
 by National Disaster Management Authority (NDMA) under Ministry of Home Affairs. in coordination with
respective State governments and National Institute for Disaster Management (NIDM).
→ assisted by World Bank. It has identified cyclone prone States and UTs.
→ Categories of States:
 Category I (Higher vulnerability States):
• West Bengal, Odisha, Andhra Pradesh, Tamil Nadu, Gujarat.
 Category II (Lower vulnerability States):
• Maharashtra, Goa, Kerala, Karnataka, Puducherry, Lakshadweep, Daman and Diu, Andaman and Nicobar
Islands.
→ Components:
 Early warning dissemination systems. Inclusion of local communities to respond to disasters. Access to
emergency shelter. Evacuation. Protection against wind storms, flooding, storm surge. Capacity at central, state
and local levels.
 Hyogo Framework for Action (HFA) [2005-15]:
→ Global blueprint for disaster risk reduction efforts between 2005 and 2015.
 Sendai Framework for Disaster Risk Reduction (2015–30):
→ What:
 It is one international document that was adopted by UN member states in 2015 at World Conference on
Disaster Risk Reduction held in Sendai, Japan, and endorsed by UNGA in 2015 itself. It is successor agreement to
Hyogo Framework for Action (2005–15), which had been most encompassing international accord to date on
disaster risk reduction. Sendai Framework is one 15-year voluntary people-centred approach to disaster risk
reduction, succeeding 2005-15 framework. Sendai Framework was 1st major agreement of post-2015
development agenda and provides Member States with concrete actions to protect development gains from risk
of disaster.
 India – member of it.
→ 4 Priority areas:
 Sendai Framework sets 4 specific priorities for action: Understanding disaster risk; Strengthening disaster risk
governance to manage disaster risk; Investing in disaster risk reduction for resilience; Enhancing disaster

Page 525 of 719

 preparedness for effective response, and to "Building Back Better" in recovery, rehabilitation and
reconstruction.
→ Feature:
 Sendai Framework recognizes that state has primary role to reduce disaster risk but that responsibility should
be shared with other stakeholders including local government, private sector and other stakeholders. UNDRR is
tasked to support implementation, follow-up and review of Sendai Framework.
→ Significance:
 Sendai Framework works hand in hand with other 2030 Agenda agreements, including Paris Agreement on
Climate Change, Addis Ababa Action Agenda on Financing for Development [2015], New Urban Agenda, and
ultimately 17 SDGs.
 Section 10 Disaster Management Act, 2005:
→ It deals with powers and functions of National Executive Committee. This section empowers National
Executive Committee to lay down guidelines for or give directions to, concerned Ministries or D epartments
of Government of India, State Governments and State Authorities regarding measures to be taken by them
in response to any threatening disaster situation or disaster.
 Coalition for Disaster Resilient Infrastructure (CDRI) [2019]:
→ What:
 CDRI is India-led and India HQ international coalition. Partnership of national governments, UN agencies and
programmes, multilateral development banks and financing mechanisms, private sector, and knowledge
institutions that aims to promote resilience of new and existing infrastructure systems to climate and disaster
risks in support of sustainable development. International coalition of countries, UN agencies, multilateral
development banks, private sector, and academic institutions, that aims to promote disaster-resiliant
infrastructure. platform where knowledge is generated and exchanged on different aspects of disaster and
climate resilience of infrastructure.
Launched by Indian PM Modi at 2019 UN Climate Action Summit in 2019. [Modi termed CDRI as
practical approach and roadmap towards climate change mitigation]. CDRI Secretariat - New Delhi, India. It is
international organization (since 2022).
→ Objective:
 To promote research and knowledge sharing in fields of infrastructure risk management, standards, financing,
and recovery mechanisms. to achieve substantial changes in member countries' policy frameworks and future
infrastructure investments, along with major decrease in economic losses suffered due to disasters.
 It promotes resilience of infrastructure systems to climate and disaster risks.
→ Function:
 rapid development of resilient infrastructure to respond to SDGs of expanding universal access to basic services,
enabling prosperity and decent work. developing disaster-resilience in ecological, social, and economic
infrastructure. create mechanism to assist countries to upgrade their capacities and practices, with regard to
infrastructure development.
 It works at intersection of Sendai Framework for DRR (2015-2030) and 2015 Paris Climate Agreement.
→ Members:
 India, Germany, Italy, Japan, Australia, USA, Some organisations, …
→ India:
 Importance for India: CDRI is 2ndinternational collaboration set up by India in climate change sphere (other
being ISA). CDRI is India-led and India HQ international coalition.
→ International Conference on Disaster Resilient Infrastructure (ICDRI):
 What:
• annual conference of CDRI. It brings together member countries, organizations and institutions to
strengthen global discourse on disaster and climate resilient infrastructure.
→ Infrastructure for Resilient Island States (IRIS) initiative [2021]:
 What:
• launched by India for developing infrastructure of small island nations (SIDS) vulnerable to climate change.
IRIS is part of CDRI [2019]. This new initiative is result of cooperation between India, U.K., Australia, Fiji,
Jamaica, Mauritius, ...
 Need:
• SIDS face biggest threat among countries from climate change. SIDS are highly vulnerable to sea-level rise,
storm surge, coastal destruction. SIDS contribute to about 1% of global greenhouse gas emissions, and yet
SIDS are among worst impacted of climate change. Agricultural production, fisheries, related sectors are
declining in SIDS due to climate changes, threatening livelihoods and economic growth. Extreme weather
created by climate change is destroying SIDS land, real estate, infrastructure, with economically catastrophic
effects.
 Focus:
• building capacity, pilot projects.

Page 526 of 719

 2021 Home Ministry data on fatalities caused by hydro-meteorological calamities:
→ In India, thousands lost their lives over past years. West Bengal - highest deaths. Over past years, West
Bengal had 4 tropical cyclones: Fani – 2019; Bulbul – 2019; Amphan – 2020; Yaas - 2021. Cloudbursts – one
reason. common in Himalayan States, Western Ghats, Konkan areas. Highest State Disaster Response Funds
allocated to Maharashtra.
 2022 Disaster Management Plan of Ministry of Panchayati Raj (DMP-MoPR):
→ What:
 released by Ministry of Panchayati Raj (MoPR)
→ Areas covered under this plan:
 Institutional arrangement for Disaster Management. Hazard Risk, Vulnerability, Capacity Analysis. Coherence of
Disaster Risk Management across Resilient Development and Climate Change Action. Disaster Specific
Preventive and Mitigation Measures-Responsibility Framework. Mainstreaming of Community Based Disaster
Management Plan of Villages and Panchayats.
→ Highlights:
 It aims to develop culture of disaster resilience at grassroots level among Panchayats and Rural Local Bodies. It
seeks to establish framework to align disaster management measures in rural areas to that of NDMA. Under this
Plan, every Indian village would have “Village Disaster Management Plan” and every Panchayat would have their
Disaster Management Plan. All stakeholders including PRIs, elected representatives, functionaries of Panchayats
etc. would participate in planning, implementation, monitoring, evaluation of this plan.
→ Need for Panchayati Level Plans:
 Panchayat-level, village-level Disaster Management Plans to mitigate challenges in event of disaster form
foundational level. Panchayati Raj Institution (PRI) (representative body of people) is most appropriate
institution from village to district level in view of its proximity; universal coverage; enlisting people’s
participation on institutionalised basis; and their close involvement will be able to make people more prepared
for countering natural disasters as well as involve them in all possible preventive and protective activities so that
impact of disasters are mitigated and people are able to save their lives and property.
 Global Platform for Disaster Risk Reduction (GP):
→ What:
 It is one global multi-stakeholder forum as well as avenue, held biennially, to share knowledge and discuss latest
developments and trends in reducing disaster risk. UNGA recognizes Global Platform as critical mechanism to
review progress on implementation of Sendai Framework for Disaster Risk Reduction 2015-30. At this Platform,
governments, UN system and all stakeholders get together to identify ways to further accelerate
implementation of Sendai Framework.
Since 2007, 7 sessions of Global Platforms have taken place, including 2022 session. Outcomes are
recognized by UNGA as contribution to deliberations of High-Level Political Forum on Sustainable Development
(HLPF), held each year and thus, contributing to risk-informed implementation and monitoring of 2030 Agenda
for Sustainable Development.
 It is one platform to assess implementation of Sendai Framework for DRR (2015-2030)
→ Global Platform 2022 / GP 2022:
 What:
• 7th session of Global Platform (GP2022) was organized and convened by UNDRR in Bali, Indonesia, hosted
by Indonesia.
 Importance:
• GP 2022 takes place at critical time: 7 years from adoption of Sendai Framework and just over 2 years since
start of COVID-19 pandemic. This global crisis has exposed how underlying vulnerabilities and inequities
have catastrophic consequences for most exposed across world. Prevention and risk reduction agenda are
essential if we are to achieve sustainable future for all.
GP2022 is one wake-up call to improve preventative measures and stop spiral of increasing disaster
impact and risk.
 Outcomes:
• Recommendations for scaling up action on disaster risk action: It calls for action, also known as Bali Agenda
for Resilience (BAR). BAR captures way forward in 7 points:
 Reconfigure Risk Governance: To ensure that risk management is one shared responsibility across
sectors, systems, scales, borders.
 Legislated DRR Public Finance: To weigh cost of disasters against investments in resilience, with
legislated budgetary targets and tracking.
 Meeting Climate Ambition: To scale up DRR to raise and achieve climate ambition, to accelerate
comprehensive disaster and climate risk management.
 "Nothing about us without us.": One participatory and human rights-based approach, with leadership
of women and young professionals.
 Universal early warning coverage: End-to-end people-centred early warning value chain, with multi-
hazard approaches.
Page 527 of 719
  Build back better, greener, equitable: Post-COVID recovery as one opportunity to reset development
pathway towards greener and more resilient future.
 Strengthen Midterm Review: To understand challenges and obstacles, and possible course corrections
to accelerate Sendai implementation.
 UN Sasakawa Award for Disaster Risk Reduction [1986]:
→ What:
 UN Sasakawa Award for Disaster Risk Reduction is awarded to individual or institution that has made
active efforts to reduce disaster risk in their community and advocates for disaster risk reduction. It
recognizes excellence in reducing disaster risk for more inclusive and sustainable world leaving no one
behind. Sasakawa Award focuses on promotion of inclusive and resilient approaches in disaster risk
reduction, reflecting centrality of inclusiveness and resilience in Sendai Framework. Winners of
Sasakawa Award receive prize, in most cases accompani ed by grant. Amount of grant shall be
determined on case-by-case basis.
UN Sasakawa Award will recognize selected candidates (individuals, groups, organizations,
local authorities, etc.) through one award accompanied by grant. Award promotes importance of more
people-centered preventive approach to disaster risk, as well as inclusive and accessible disaster risk
reduction practices, in line with Sendai Framework.
UN Sasakawa Award for Disaster Risk Reduction is one global award established in 1986 by
founding Chairman of Nippon Foundation, Mr Ryoichi Sasakawa for recognising excellence in reducing
disaster risk.
It honours practices and efforts made by institutions, individuals and groups that have best
contributed to building resilience through multi -hazard approach. It focuses on promotion of inclusive
and resilient approaches in disaster risk reduction.
→ Background:
 Together with WHO Sasakawa Health Prize and UNEP Sasakawa Environment Prize, UN Sasakawa
Award for Disaster Risk Reduction is one of 3 prestigious prizes established in 1986 by founding
Chairman of Nippon Foundation, Mr. Ryoichi Sasakawa.
→ 2022 UN Sasakawa Award:
 It will honor practices and efforts made by institutions, individuals and groups that have best contributed to
building resilience through multi-hazard approach. Theme - Building resilience through multi-hazard approach.
 International Chemical Safety Cards (ICSC):
→ ICSCs are data sheets intended to provide essential safety and health information on chemicals in clear and concise
way. Primary aim of these Cards is to promote safe use of chemicals in workplace. Main target users are workers and
those responsible for occupational safety and health. ICSCs project is one common undertaking between ILO and
WHO, with cooperation of European Commission.
Mains Link:
 Discuss the need for Disaster risk reduction in India. What are the challenges involved and explain the global efforts in
this direction? (250 words)
 How important is vulnerability and risk assessment for pre-disaster management? As an administrator, what are key
areas that you would focus Ina disaster management? (2013)

FINANCIAL ACTION TASK FORCE (FATF) [1989]

News:
 2018:
→ FATF puts Pakistan in grey list.
 2020:
→ Mauritius put in FATF grey list (money laundering route for FPIs due to Mauritius limited regulatory
oversight).
→ Pakistan put in Enhanced Follow-Up.
 2021:
→ FATF refuses to take Pakistan out of Grey List because it had failed to take appropriate action against UN -
designated terrorists - 26/11 accused Hafiz Saeed, JeM chief Masood Azhar etc. Pakistan will continue to be
on “Grey List” of FATF as it needs to further demonstrate that action is being taken against UN -designated
terrorists like India’s most wanted Hafiz Saeed, Masood Azhar, and grou ps led by them.
→ FATF adds Turkey, Jordan, Mali in its grey list.
→ FATF moved Mauritius out of FATF grey list.
 Impact on India: RBI may lift curbs on ownership and control by entities in Mauritius investing in Indian NBFCs,
Indian payment companies. Indian non-banking and other financial services companies may now receive FDI
from funds and vehicles incorporated by international investors in Mauritius. This may lead to higher investment
to India from Mauritius. Now, there would be less scrutiny by custodian banks on ‘beneficial ownership’ (BO) of
Mauritius vehicles coming in as FPI and FDI.
 2022:
Page 528 of 719
 → FATF meeting starts in Paris and will announce whether Pakistan is to be retained in grey list, or list of
countries under increased monitoring.
→ USA ramps up efforts to bring India on board with sanctions on Russia and sends another senior official to discuss
India’s oil purchases and plans to use rupee-ruble payment mechanism to circumvent sanctions against Russia.
 Issue: India is heavily dependent on oil imports, bulk of which comes from Middle East, Africa, Europe, North
America, South America, SE Asia. Russia’s oil-related exports to India are only about USD 1 billion. Russia is keen
to scale this up even as US has announced ban on oil imports from Russia and UK has adopted more gradual
reduction (2022 Ukraine War). This offers opportunity for lucrative supply deal with 2nd largest oil exporter
(Russia) after Saudi Arabia. Rupee-Ruble payment system is crucial for bilateral non-oil trade as this would allow
Indian exporters to be paid in rupees.
→ China places ‘technical hold’ on joint proposal by India and USA to designate Abdul Rehman Makki (brother-in-law
of Hafiz Saeed, founder of Lashkar-e-Toiba) under UNSC Resolution 1267. [This shows China’s double standards on
terrorism and related activities]. [In this context, proposal to designate Makki helps India remind world that Pakistan
may get off FATF, but its concerns about terrorism emanating from Pakistan remain].
→ 4 years after it was placed on the “grey list” and penalised with severe financial strictures by FATF, Pakistan now wins
a major reprieve, as FATF (international watchdog on terror financing and money laundering) agrees to remove
Pakistan’s name from the list of countries under “increased monitoring”. FATF says Pakistan has completed 2 action
plans comprising a 34-point tasklist in the period since 2018, and has welcomed Pakistan’s significant progress in its
Anti-Money Laundering / Combating the Financing of Terrorism (AML/CFT) mechanisms. [Pakistan is not member of
FATF].
 Practical benefits to Pakistan:
• Receive a reputational boost and get a clean bill of health from the international community on terrorist
financing.
• Increase in overseas investment in Pakistan.
About:
 What:
→ Intergovernmental organisation founded in 1989 on initiative of G7 to develop policies to combat money
laundering. In 2001, its mandate was expanded to include terrorism financing.
→ Policy-making body to develop policies to combat money laundering.
→ multilateral financial watchdog.
→ Secretariat - at OECD headquarters, Paris.
 History:
→ FATF was formed by 1989 G7 Summit in Paris to combat the growing problem of money laundering. The
mandate of the organisation was expanded in 2001 to include terrorist financing following the September 11
2001 terror attacks. In 2012, it added efforts to counter the financing of the proliferation of weapons of mass
destruction.
 Objectives:
→ Bring about nationals’ legislative and regulatory reforms.
→ set standards
→ promote effective implementation of legal, regulatory and operational measures.
 Roles and functions:
→ Combat money laundering: Studying money laundering trends, monitoring legislative, financial and law
enforcement activities taken at the national and international level, reporting on compliance, and issuing
recommendations and standards to combat money laundering.
→ Combat terrorist financing.
→ Combat financing of proliferation of weapons of mass destruction.
→ Combat other related threats to international financial system.
→ FATF assesses strength of country’s anti-money laundering and anti-terror financing frameworks.
→ FATF sets standards and promote effective implementation of legal, regulat ory and operational measures for
combating money laundering, terrorist financing and other related threats to integrity of international
financial system.
→ FATF Plenary which is decision making body of FATF meets 3 times per year.
 Composition:
→ 37 member jurisdictions (representing major financial centres of world):
 Australia, Brazil, Canada, China, France, Germany, Hong Kong, India, Israel, Japan, Russian Federation, Saudi
Arabia, Singapore, South Korea, UK, United States, ….
→ 2 regional organisations:
 European Commission, Gulf Cooperation Council (GCC)
→ observers
→ associate members
 Lists:

Page 529 of 719

 → Grey List / Increased monitoring list / Monitored Jurisdictions:
 List having safe haven countries for terror funding and money laundering. That is, if countries fail to prevent
international money laundering and terrorist financing, then they shall be placed on this list.
 This serves as warning to these countries that they may enter blacklist.
 Example, as of 2022: Pakistan, Iceland, Yemen, Syria.
→ Dark Grey / Warning:
 one essential stage between Grey list and Black list
 issuance of strong warning, so that country concerned gets one last chance to improve.
→ Black List / High Risk:
 Non-Cooperative Countries or Territories (NCCT): List of non-cooperative countries in global effort to combat
money laundering and financing of terrorism
 These countries support terror funding and money laundering activities.
 FATF revises blacklist regularly - adding or deleting entries.
 Countries in this Black List are put under harsh economic sanctions and greater scrutiny of financial transactions.
Only North Korea, Iran are currently included in black list.
 Example, as of 2022: Iran, North Korea.
 Punishments:
→ Economic sanctions from IMF, World Bank, ADB.
→ Hard to get loans from IMF, World Bank, ADB and other countries.
→ Reduction in international trade.
→ International boycott.
 Measures asked of grey / black listed countries:
→ terror financing investigation
→ prosecution of leaders and commanders of UN-designated terrorist groups and their associates
 India:
→ Member of FATF
→ Member of Asia Pacific Group (APG) of FATF
→ Member of Eurasian Group (EAG) of FATF
Note:
 Enhanced Follow-Up:
→ One list related to FATF
 FATF-style regional bodies (FSRB):
→ 8 FSRBs have been established
→ for purpose of disseminating International standards on combating money laundering, financing of
terrorism & proliferation (FATF Recommendations) throughout world.
→ main task is to set up systems for combating money laundering, financing of terrorism and proliferation in
their respective regions.
→ FSRBs conduct evaluations of member states and make recommendations for their improvement.
→ They are:
 Asia / Pacific Group on combating money laundering (APG):
• FATF style regional inter-governmental (international) body to implement international standards against:
money laundering, financing of terrorism, financing proliferation of weapons of mass destruction.
 Eurasian Group (EAG)
 …
Value Addition:
 India backs Mauritius over its claim on disputed Chagos islands (home to Diego Garci a — key military base of
UK and US in Indian Ocean) in Indian Ocean.
 Egmont Group:
→ international organization that facilitates cooperation and intelligence sharing between national Financial
Intelligence Units (FIUs) to investigate and prevent money launde ring and terrorist financing.
→ National FIUs collect information on suspicious or unusual financial activity and are responsible for
processing and analyzing information received.
→ FIUs are normally not law enforcement agencies themselves, findings are share d with appropriate law
enforcement or prosecution bodies.
→ headquartered - Toronto, Ontario, Canada.
→ India is party to it.
Mains Link:
 Discuss the role of Financial Action Task Force in combating money laundering and terror financing. (15M)

HATE SPEECH
News:
Page 530 of 719
  2017:
→ T.K. Viswanathan committee (cybercrimes [especially online hate speech]) submitted its report to Home Ministry.
 2021:
→ Committee for Reforms in Criminal Laws (Srikrishna Deva Rao Committee) is expected to submit report, that will
standardise definition of Hate Speech for 1st time.
 Need:
• No clear definition of what constitutes “hate speech” in Indian Penal Code (IPC), 1860.
→ Events occurred that targeted political, social, economic exclusion of Muslims through rallies and hate speeches.
 2022:
→ Supreme Court agrees to hear petitions asking for legal action to be taken against organisers of / speakers at
“Hardwar Dharma Sansad”.
→ RS Chairman M. Venkaiah Naidu says that hate speech should not be made against any community, be it minority or
majority.
 Background:
• Concerns are raised over argeted political, social, economic exclusion of Muslims through rallies and hate
speeches. Journalists too were attacked.
→ ECI in Supreme Court says that due to lack of specific law against hate speech and rumour mongering during polls, it
has to resort to IPC and RPA, 1951 to ensure that members of political parties do not make statements which can
create disharmony among sections of society: ECI in one affidavit says that in absence of any specific law governing
hate speech and rumour mongering during elections, it employs various provisions of IPC and RPA, 1951 to ensure
that members of political parties or even other persons do not make statements to effect of creating disharmony
between different sections of society. [Law Commission did not make any recommendations to Parliament to curb
hate speech].
→ Supreme Court condemns hate speech aired on TV: Supreme Court wonders why government continues to remain
mute spectator to hatred promoted in electronic media. Supreme Court says role of TV anchors is critical in
monitoring that their shows do not descend into hate speech.
→ I&B Ministry blocks 45 videos from 10 YouTube channels: Based on inputs from intelligence agencies, IB Ministry
issues directions, using Section 69A IT Act, 2000, for blocking videos under Information Technology (Intermediary
Guidelines and Digital Media Ethics Code) Rules 2021. IB Ministry said - content included fake news and morphed
videos with intent to spread hatred among religious communities. Examples include false claims such as government
has taken away religious rights of certain communities; violent threats against religious communities; declaration of
civil war in India, etc. Such videos were found to have potential to cause communal disharmony and disrupt public
order in India.
→ UN Secretary-General Antonio Guterres says nurture diversity by condemning hate speech unequivocally. Mr.
Guterres says that diversity is a richness that makes India stronger; says concrete actions should be taken in support
of the rights and freedoms of journalists, activists, students and academics: Making a strong pitch for the protection
of human rights and pluralism in India, UN Secretary-General Antonio Guterres urges Indians to condemn hate
speech and says India's global role will benefit if "concrete actions" are taken in support of the "rights and freedoms
of journalists, human rights activists, students and academics.
→ Supreme Court, in interim directions, directed the police chiefs of Delhi, Uttar Pradesh and Uttarakhand to take
“immediate” suo motu action against any hate speech, by lodging criminal cases without waiting for formal
complaints. [Apex court warned authorities that any hesitation to act in accordance with this direction will be viewed
as contempt of court and that appropriate action shall be taken against the erring officers].
About:
 What:
→ In common language, “hate speech” refers to offensive discourse targeting group or individual based on inherent
characteristics (such as race, religion, gender) and that may threaten social peace. There is no universal definition of
hate speech under international human rights law. Concept is still widely disputed, especially in relation to freedom
of opinion and expression, non-discrimination and equality.
To provide unified framework for UN to address this issue globally, UN Strategy and Plan of Action on Hate
Speech defines hate speech as any kind of communication in speech, writing or behaviour, that attacks or uses
pejorative or discriminatory language with reference to person or group on basis of who they are, in other words,
based on their religion, ethnicity, nationality, race, colour, descent, gender or other identity factor.
Incitement to hatred, usually against marginalized groups because of their religious belief, sexual orientation,
gender etc. But, no clear definition of what constitutes “hate speech” in Indian Penal Code (IPC), 1860.
Though, recently, Bureau of Police Research and Development, Min. of Home Affairs has defined hate speech as
“language that critisizes unfairly, insults, threatens or targets individuals based on their identity and other traits
(sexual orientation, disability, religion etc.)”. Hate Speech also means process of pushing marginalised groups out of
social, economic, political spheres of society by spreading hate propaganda and encouraging discrimination.
 Law:
→ India does not have a formal legal framework for dealing with hate speech, but a set of provisions of the
IPC, loosely defining hate speech, are invoked. For example – Section 295A IPC.
Page 531 of 719
 → Article 19 laid reasonable restrictions on right to freedom to speech and expression in interests of:
 sovereignty and integrity of India; security of state; friendly relations with foreign states; public order; decency
or morality; in relation to contempt of court; in relation to defamation; in relation to incitement to offence.
→ IPC:
 Section 153A IPC (Promoting enmity between different groups on grounds of religion, race, place of
birth, residence, language, etc., and doing acts prejudicial to maintenance of harmony).
 Section 153B IPC (Imputations, assertions prejudicial to national -integration).
 Section 295A IPC (Deliberate and malicious acts, intended to outrage religious feelings of any class by
insulting its religion or religious beliefs): It deals with punishing acts which deliberately or with
malicious intention outrage religious feelings of class of persons.
 Section 505 IPC (Statements conducing to public mischief).
→ RPA, 1951:
 Section 123(3A), and Section 125 RPA, 1951 bar promotion of animosity on grounds of race, religion,
community, caste, or language in reference to elections and include it under corrupt electoral
practices.
 [ECI uses both IPC and RPA, 1951 to charge candidates of political parties].
 Hate speech during election times could be viewed as violation of RPA, 1951 under corrupt practices
and electoral offences.
 Factors / causes:
→ Primary reason for the propagation of hate speech by individuals is that they believe in stereotypes that are ingrained
in their minds. These stereotypes lead them to believe that class or group of persons are inferior to them and as such
cannot have same rights as them.
→ Sticking to particular ideology without caring for rights to co-exist peacefully.
 Criteria to identify hate speech:
→ Incitement to offence. Extremity of speech. Status of author of speech. Status of victims of speech.
Potentiality of speech. Context of speech.
 Hate speech and media:
→ In 2022, Supreme Court condemned hate speech aired on TV. Supreme Court wondered why government
continues to remain mute spectator to hatred promoted in electronic media. Supreme Court said role of TV
anchors was critical in monitoring that their shows did not descend into hate speech. Expressing its anguish
and displeasure over hate speeches via debates on TV channels, Supreme Court called “visual media” “chief
medium of hate speech” and questioned government why it is standing by as mute witness when all this is
happening and treating it as one trivial matter (not important). Supreme Court underlined that hate drives
TRPs, drives profit basically going against media ethics and said it will consider laying down some guidelines
which will hold field until legislature comes up with law on matter. Supreme Court p ointed out that hate
speech can be in different forms and its spread through visual media can have devastating effect.
 Issue:
→ Need for standard definition:
 Legally, criminal sections should be invoked only when hate speech leads to violence or disturbance of law and
order. However, currently even merely criticising someone is being termed as hate speech. This is happening
because of no proper definition of Hate Speech.
→ In 2022, ECI, in one affidavit addressed to Supreme Court, said that in absence of any specific law governing
hate speech and rumour mongering during elections, it employed various provisions of IPC and RPA, 1951
to ensure that members of political parties or even other persons do not make statements to effect o f
creating disharmony between different sections of society.
→ Law Commission did not make any recommendations to Parliament to curb hate speech.
→ In 2021, UN Secretary General Mr. Guterres said that social media provides global megaphone for hate.
→ Effect [Need to curb hate speech]:
 Hate speech threatens 2 key doctrines of democracy: Equal dignity to all; Public good of inclusiveness.
 Law Commission:
• Its 267th report said hate speech has potential to provoke individuals and society to commit: Terrorism,
Genocide, ethnic cleansing.
 Internal Security: Ex. 2013 Muzaffarnagar riots.
 Extremism.
 Mob lynching.
 Misinformation and disinformation: Ex. 2020 Delhi Riots.
 At its most harmful, hate speech is widely recognized as precursor to ethnic cleansing.
 Initiative:
→ UN launched United Nations Strategy and Plan of Action on Hate Speech
→ Social media companies - Facebook, Google, Twitter etc. - are working to curb fake news on their platforms
in India.

Page 532 of 719

 → ECI’s measures taken under Model Code of Conduct to ensure that political parties do not make statements that
could create disharmony between different sections of society :
 Issuing advisories cautioning candidates.
 Prohibiting them from campaigning for specified period of time.
 Initiation of criminal complaint under IPC and RPA, 1951 in case of repeat offenders.
 Way Forward:
→ ECI may tie up with tech companies to address fake news in c/w elections.
→ Educating end-users.
→ Government should bring out Hate Speech policy framework.
→ Imposing hefty fines (like in Germany) on social media companies when they persistently fail to remove
illegal contents from their sites.
→ Some experts argue that special provisions is required, because IPC is not enough to deal with hate speech,
rumour mongering.
→ Public authorities must be held accountable for negligence of duty and also for non -compliance with
court’s orders by not taking action to prevent vigilante groups from inciting c ommunal disharmony and
spreading hate against citizens of India and taking laws into their own hands.
 Committee:
→ Bezbaruah committee [2014]:
 It was constituted in 2014 in wake of series of racial attacks on persons belonging to NE India.
 It proposes to insert two stricter anti-racial discrimination provisions in IPC.
→ T.K. Viswanathan committee [2017]:
 On cybercrimes, especially online hate speech
 It recommends stricter laws to curb online hate speech and use of cyberspace to spread hatred and incitement.
 It proposes inserting sections in IPC for incitement to commit offence on grounds of religion, race, caste or
community, sex, gender identity, sexual orientation, place of birth, residence, language, disability or tribe.
 Judiciary:
→ In 2020 Amish Devgun judgment, Supreme Court linked hate speech to violation of unity and fraternity and
breach of human dignity, which constitutes essential feature of right to life and liberty under Article 21.
→ In 2022, Supreme Court condemned hate speech aired on TV.
→ Supreme Court rulings on IPC Section 295A:
 In Ramji Lal Modi vs The State of U.P. (1957), Supreme Court upheld the 295A IPC law on the grounds that it was
brought in to preserve “public order”.
 In Sri Baragur Ramachandrappa & Ors vs State of Karnataka (2007), Supreme Court adopting a pragmatic
approach ordered that public order supersedes the individual interest of free speech.
Note:
 Public order is an exemption to the fundamental right to freedom of speech and expression and the right to religion
recognised by the Constitution.
 Diversity:
→ What:
 It means collective differences, that is, differences which mark off one group of people from another. These
differences may be of any sort: biological, religious, linguistic etc. Diversity means a variety of races, religions,
languages, castes, and cultures.
→ How to enrich Indian diversity?
 Practising the values of Gandhi.
 Securing and upholding the rights and dignity of all people, especially the most vulnerable.
 Taking concrete action for inclusion.
 Recognising the enormous value and contributions of multicultural, multi-religious and multi-ethnic societies.
 Condemning hate speech unequivocally.
 Suggestions by UN Secretary-General Guterres for India:
• India should continue to speak up for peace. India should expand its global leadership. India should align its
development and its foreign policy with the SDGs and 2015 Paris Agreement. India should find innovative
solutions to today’s global crises.
Mains Link:
 Hate speech poses complex challenges to freedom of speech and expression along with spreading hatred. Do
you think curbing hate speech in visual media through legislation would be effective? 10M

BANK / BANKING IN INDIA

News:
 2020:
→ Internal Working Group (IWG) of RBI recommends to allow large corporate / industrial houses to be
promoters of private banks (banking licences to large corporate / business groups / industrial houses).

Page 533 of 719

 2021:
→ 2021 Budget proposes to privatise 2 PSU banks.
→ RBI keeps above said Internal recommendation in suspension.
→ RBI allows Payments Bank, Small Finance Bank (SFB) to conduct Govt. agency business, provided that bank
should not be under PCA framework or moratorium].
 Implication: Payments Bank, Small Finance Bank (SFB) can now participate in government, corporations issued
Request for Proposals (RFP), primary auctions, fixed-rate repos, variable rate repos, reverse repos, MSF.
Payments Bank, Small Finance Bank (SFB) would now be eligible to partner in government-run financial inclusion
schemes.
 2022:
→ RBI releases its list of D-SIBs in 2021. [SBI, ICICI Bank, HDFC Bank].
→ RBI includes Airtel Payments Bank Ltd. in 2 nd Schedule to Reserve Bank of India Act, 1934. [Thereby, Airtel
payments bank gets scheduled bank status and is now scheduled bank.]
 Implication: Airtel payments bank can now take part for government-issued Requests for Proposals
(RFP), primary auctions, undertake both Central and State Government business.
→ All India Bank Employees Association carries out strike insisting that recruitment of workers be increased,
among other demands.
→ India Post Payments Bank (IPPB) announces launch of Fincluvation.
→ Union cabinet approves Rs. 820 crore financial support for IPPB.
→ Minister of Cooperation Amit Shah (Ministry of Cooperation) says that cooperative banks w ill not be given
2 nd -grade treatment but they should adopt modern and transparent banking methods to stay in
competition. He said that cooperatives should give way to younger people in management roles and
engage professionals to run day-to-day affairs.
→ Cabinet approves digitisation of 63,000 PACS.
→ As Congress marks 53rd anniversary of PM Indira Gandhi nationalising 14 banks, bank nationalization was
in news - whether it was masterstroke or policy failure. [Currently, GOI is on way to bring legislative
changes to privatise PSBs (denationalization of Banks)].
→ Big bang privatisation of banks can be harmful: RBI article
→ ‘State-owned lenders have eye not only on profit, but financial inclusion too; balance sheets suggest they
also weathered COVID storm well’
→ One RBI bulletin in 2022 warns that big-bang privatisation of PSBs can do more harm than good and asks
government to take careful approach on this issue. This RBI bulletin also says that while private sector
banks (PVBs) are more efficient in profit maximisation, their public sector counterparts (PSBs) have done
better in promoting financial inclusion. This bulletin also says that gradual approach to privatisation
adopted by government could ensure that void was not created in fulfilling social object ive of financial
inclusion and monetary transmission. This bulletin also says that PSBs had played key role in catalysing
financial investments in low-carbon industries, thereby promoting green transition in countries such as
Brazil, China, Germany, Japan, and in EU.
→ In Union Budget 2021-22, GOI announced its decision to privatise 2 PSBs. Some authors in newspapers
argue that government should privatize all PSBs except SBI.
→ FM Nirmala Sitharaman launches EASE 5.0 'Common reforms agenda' for PSBs: Enhanced Access and
Service Excellence-EASE has evolved over 4 annual editions from FY19 to FY22 and has catalyzed reforms
in diverse areas in Public Sector Banks.
→ Global cybersecurity firm Kaspersky warns of increase in cyberattacks on Android and iOS devices in As ia
Pacific (APAC) region.
→ RBI Fraud Registry to check banking frauds: With intent of improving consumer protection amid cases of
digital frauds, RBI is in discussions to set up one fraud registry to create one database of fraudulent
websites, phones and various methods used by fraudsters. Payment system participants will be provided
access to this registry for near-real time fraud monitoring. Aggregated fraud data will be published to
educate customers on emerging risks.
→ Automation impacts lower-level jobs in banks; ATM usage, mobile and online transactions, and fewer new
bank branches have led to reduced recruitment: Finance Ministry asks heads of public sector banks (PSBs)
for plan to improve employee count. Business Line (newspaper) reported that vacancies announced for
clerical posts had significantly decreased in year 2022, and it also showed declining interest in bank jobs,
with increasingly fewer candidates registering for recruitment / selection programmes. [Earlier, All India
Bank Employees Association had carried out strike insisting that recruitment of workers be increased,
among other demands].
→ Union Cooperation Minister Amit Shah says that PACS will be set up in all panchayats of India over next 5
years to boost activities such as marketing of dairy products. He also says people of NE India will benefit
great deal from this.

Page 534 of 719

 → For significantly improving “our understanding of role of banks in economy, particularly during financial crises,”
Nobel Prize in Economics for 2022 is awarded to 3 American economists: Ben S Bernanke, Douglas W Diamond, and
Philip H Dybvig.
 Douglas W Diamond and Philip H Dybvig offered one solution to banking crisis. Banks, by acting as intermediaries
that accept deposits from many savers, can allow depositors to access their money when they wish, while also
offering long-term loans to borrowers. Bank runs can be prevented if govt. provides deposit insurance and acts
as one lender of last resort to banks.
 Ben S Bernanke analysed Great Depression of 1930s, worst economic crisis in modern history. Among other
things, he showed how bank runs were a decisive factor in Great Depression 1930s crisis becoming so deep and
prolonged.
→ RBI puts Dhanlaxmi Bank under observation due to decreasing CRAR of the Bank.
About:
 Evolution:
→ India's independence marked end of regime of Laissez-faire for Indian banking. GOI initiated measures to
play active role in economic life of nation, and GOI’s Industrial Policy Resolution 1948 envisaged mixed
economy. This resulted in greater involvement of state in different segments of economy including
banking, finance. Major steps to regulate banking included:
 RBI, India's central banking authority, was established in 1935, and was nationalized in 1949 under terms of
Reserve Bank (Transfer to Public Ownership) Act, 1948;
 Banking Regulation Act, 1949 was enacted which empowered RBI to regulate, control, and inspect banks in India.
Banking Regulation Act, 1949 also provided that no new bank or branch of existing bank could be opened
without license from RBI, and no two banks could have common directors.
→ Nationalisation in 1969:
 Intro:
• Despite provisions, control and regulations of RBI, banks in India except SBI, remain owned and operated
by private persons. By 1960s, Indian banking industry had become one important tool to facilitate
development of Indian economy. Indira Gandhi led GOI issued Banking Companies (Acquisition and Transfer
of Undertakings) Ordinance, 1969 and nationalized 14 largest commercial banks. These banks contained
85% of bank deposits in India. Within two weeks of issue of ordinance, Parliament enacted Banking
Companies (Acquisition and Transfer of Undertakings) Act, 1969.
 Aim of bank nationalization of 1969: Government aimed to take away the control from a few private players and
expand the banking coverage to rural India so that sectors such as agriculture and small industries could get
better credit facilities, thus creating a new class of entrepreneurs.
 Factors:
• Two wars (China 1962, Pakistan 1965) and two successive years of drought had put pressure on public
finances.
• 3-year plan holiday and slowdown in growth affected aggregate demand as public investment was reduced.
• Need to control private monopolies and equal distribution of wealth.
• Need to mobilize savings to develop agriculture and small industries.
• To reduce regional imbalance to curb urban-rural divide.
• Between 1951-68, agriculture had received < 2% of credit disbursed by commercial banks.
→ Nationalisation in 1980:
 2nd round of nationalizations of some more commercial banks followed in 1980. Stated reason for nationalization
was to give government more control of credit delivery. With this 2nd round of nationalizations, GOI controlled
around 91% of banking business of India.
→ Liberalisation in 1990s:
 In early 1990s, then GOI embarked on policy of liberalisation, licensing small number of private banks. These
came to be known as New Generation tech-savvy banks, e.g. Global Trust Bank. This move – along with rapid
growth in economy of India – revitalised banking sector in India, which has seen rapid growth with strong
contribution from all 3 sectors of banks, namely, government banks, private banks, foreign banks.
Next stage for Indian banking has been set up, with proposed relaxation of norms for FDI. All foreign
investors in banks may be given voting rights.
→ PSB Amalgamations in 2000s and 2010s:
 SBI: SBI merged with its associate banks; BOB merger; PNB merger; Canara Bank merger, etc.
→ Rescue of private and co-operative banks (2020s):
 Yes bank; Lakshmi Vilas Bank etc.
 Classification:
→ Currently, Indian banking sector is broadly classified into below bank, and they are all under RBI:
 Scheduled Banks; and
• What: All banks included in 2 nd Schedule to Reserve Bank of India Act, 1934 are Scheduled Banks.
• Component: These Scheduled Banks comprise:

Page 535 of 719

  Commercial Banks / Scheduled Commercial Banks:
o PSBs (SBI etc.), Private Sector Banks, Foreign Sector Banks, RRBs.
 Co-operative Banks / Scheduled Co-operative Banks:
o Component: Scheduled Co-operative Banks consist of:
✓ Scheduled State Co-operative Banks; and
✓ Scheduled Urban Cooperative Banks.
 Non-Scheduled Banks.
→ In the bank group-wise classification, IDBI Bank Ltd. is included in the category of other public sector bank.
 Nationalization of Bank / Bank Nationalization:
→ What:
 In India, banks which were previously functioning under private sector were transferred to public sector by Act
of nationalization and thus nationalized banks came into existence.
→ Reasons:
 For Social Welfare; For Developing Banking Habits; For Expansion of Banking Sector; For Controlling Private
Monopolies; To Reduce Regional Imbalance; For Prioritizing Sector Lending.
→ Bank nationalisation: Blunder or masterstroke?
 Background:
• Post-1967 period saw series of radical economic policies such as nationalization of 14 biggest commercial
banks (1969), insurance (1972), coal industry (1973), effort to nationalize wholesale wheat trade (1973),
takeover of ‘sick’ companies, etc. Now, according to many economists, long-term impact of these decisions
is being felt, in terms of looming banking crisis, inefficient coal sector, and poor insurance penetration
(3.76% in 2019; one of lowest in world).
 Arguments:
•
{1970s Nationalization was bad move because of {Nationalization did help Indian economy as it led to}
below -ve impacts it led to.}
Emergence of structural features that bred Higher penetration of no. of banks in rural areas
inefficiency: Strategy of nationalization together and underdeveloped sectors. Liberal credit
with import-substitution-industrialization (ISI) and availability by banks led to India’s growth process,
‘Licence Quota Raj’ stifled entrepreneurship and particularly during Green revolution. Credit to rural
innovation. Nationalization led to lesser areas increased. Both rural bank deposit
competition between public sector and private mobilization and rural credit increased significantly
sectors, this has again led to bureaucratic attitude after 1969 nationalization.
in functioning of PSUs, Lack of initiatives and
responsibility, populist pressures, irresponsible
trade unionism, red-tapism, etc.
India lost out on ‘internationalization of Priority-sector lending: Setting aside 40% of banks’
production’: India’s policy of nationalization and net bank credit for agriculture, MSME, education,
‘protectionist’ inward-looking economy’ failed to housing, “weaker” sections.
take advantage of globalization that created East
Asian miracle economies. Implication of it was that
India’s export shrank from 2.4% (1948) to 0.42 in
1980.
Erosion of fiscal prudence: Government Domestic saving: Rates of domestic savings and
expenditure kept rising due to proliferation of investment increased rapidly.
subsidies and grants, salary increases with no
relationship to efficiency or output, overstaffing,
and other ‘populist measures. Because of lack of
performance audit, finance from public banks and
PSUs failed to accomplish large public interest.
Currently, NPA crisis is considered legacy of Removed monopoly of private sector in some
nationalization of banks of 1970s and 80s: sectors such as coal: After nationalization of coal
Government ownership and political interference industry in India, India never witnessed demand-
reduced accountability of banks. Also, nationalized supply gap until 1991.
banks are either operating under losses or
experiencing falling dividends. Insurance sector is
facing issues of low penetration (only 3.76% of
overall insurance penetration in India), public
sector monopoly, low non-life insurance, and poor
financial health of public sector insurers.
Government has still not been able to close down

Page 536 of 719

 all nationalized ‘sick’ PSUs, thus draining taxpayer’s
money.
Nayak Committee report (2014): Public sector banks Investment in Government Securities: There has
have poor financial position, selection process been significant increase in investment of banks in
compromised and non-transparent, high NPAs, government and other approved securities in recent
board governance weak. years.
Economic Survey review of bank nationalization Balance of payment situation improved considerably
(2020): Every rupee of taxpayer money invested in after nationalization as green revolution led to
PSBs fetches market value of just 71 paise (in reduction in food and other imports.
contrast private sector banks fetches market value
of Rs 3.70).
Issue of “phone banking”: Public sector bank officials Soared employment opportunities: Huge expansion
can be forced to extend loans when such loans don’t of PSUs created job opportunities, giving
make economic sense. employment to vast number of educated youths.
Economic survey 2020 pointed out that PSBs enjoy Success of “JAM Trinity”: JAM stands for Jan-Dhan,
less strategic and operating freedom because of Aadhaar and Mobile number. This initiative would
majority government ownership. have been non-starter had there been only private
banks and no PSBs in India.
 Conclusion:
• Thus, conceptually nationalization was one good idea as it pushed for redistribution of wealth, job creation,
and financial inclusion. However, efforts should have been taken to improve efficiency and make PSUs
competitive as was done by China.
 Privatization of PSU Banks:
→ What:
 Transfer of ownership, property or business from government (PSBs) to private sector banks. Government
ceases to be owner of entity or business.
[Privatization is considered to bring more efficiency and objectivity to company, something that
government company is not concerned about. India went for privatization in historic reforms budget of 1991,
also known as ‘New Economic Policy or LPG policy’].
→ Background:
 Bank Nationalisation: In 1960s, PM Indira Gandhi govt. nationalized some largest private banks. Aim was to align
banking sector with socialistic approach of government. SBI was nationalised in 1955.
→ Need:
 Issues in PSU Banks: high NPA; high stressed assets; Sub-standard financial position of PSU banks; Low profits;
Low market capitalization; After Covid-19 pandemic, government would again need to inject equity into weak
PSU Banks.
→ Arguments for privatization:
 Private sector banks are far more efficient, far more productive and far less corrupt than PSBs. Private banks had
greater contribution towards extending loans. They also had higher % of contribution to getting deposits from
savers. Private banks added more branches and created new jobs while PSBs saw declines on both counts.
Sometimes PSBs have been disproportionately guilty of fraud.
→ Arguments against privatization:
 In one RBI paper titled “Privatization of Public Sector Banks: An Alternate Perspective”, big bang approach of
privatization of these public sector or government-owned banks may do more harm than good.
 Rural reach: While private banks dominate metropolitan areas, it is PSBs that operate branches in rural India.
PSBs provide more ATMs in rural India.
 Social relevance: Private sector banks accounted for just 1.3 crores of total of almost 46 crore beneficiaries of
PM Jan Dhan Yojana.
 PSB is better in financial inclusion: On profit maximization, Private banks are more efficient but when objective
is financial inclusion — PSBs are better.
 Infrastructure finance: PSBs have lion’s share in these lendings.
 PSBs are also more effective in monetary policy transmission, aiding counter-cyclical monetary policy (steps
taken by RBI that go against direction of economic or business cycle) actions to gain traction.
 One author’s view published in one RBI bulletin in 2022 [views expressed in it were of authors and do not
represent that of RBI]:
• This RBI bulletin in 2022 warned that big-bang privatisation of PSBs can do more harm than good
and asked government to take careful approach on this issue. This RBI bulletin also said that while
private sector banks (PVBs) are more efficient in profit maximisation, their public sector
counterparts (PSBs) have done better in promoting financial inclusion. This bulletin also said that
gradual approach to privatisation adopted by government could ensure that void was not created
in fulfilling social objective of financial inclusion and monetary transmission. This bulletin also said

Page 537 of 719

 that PSBs had played key role in catalysing financial investments in low -carbon industries, thereby
promoting green transition in countries such as Brazil, China, Germany, Japan, and in EU.
• Said RBI bulletin in 2022 warns that big-bang privatisation of PSBs can do more harm than good
and asks government to take careful approach on this issue. This RBI bulletin also says that while
private sector banks (PVBs) are more efficient in profit maximisation, their public sector
counterparts (PSBs) have done better in promoting financial inclusion. This bulletin also says that
gradual approach to privatisation adopted by government could ensure that void was not created
in fulfilling social objective of financial inclusion and monetary transmission. This bulletin also says
that PSBs had played key role in catalysing financial investments in low -carbon industries, thereby
promoting green transition in countries such as Brazil, China, Germany, Japan, and in EU.
• Said RBI bulletin in 2022 said that evidence suggested that PSBs were not entirely guided by profit
maximisation goal alone and have integrated desirable financial inclusion goals in their objective function
unlike private sector banks.
• Said RBI bulletin in 2022 also talked about countercyclical role of PSB lending i.e. in recent years, these
PSBs have also gained greater market confidence. Despite criticism of weak balance sheets, data suggests
that they weathered COVID-19 pandemic shock remarkably well.
• It also said that recent mega mergers of PSBs have resulted in consolidation of this sector, creating stronger
and more robust and competitive banks. In 2020, government merged 10 nationalised banks into 4 large
lenders, thereby bringing down number of PSBs to 12. There were 27 state-run lenders in 2017. United Bank
of India and Oriental Bank of Commerce were merged with Punjab National Bank; Syndicate Bank was
amalgamated with Canara Bank; Allahabad Bank was amalgamated with Indian Bank; and Andhra Bank and
Corporation Bank were consolidated with Union Bank of India. In 1 st 3-way merger, Dena Bank and Vijaya
Bank were merged with Bank of Baroda in 2019. Prior to this, government had merged 5 associate banks of
SBI and Bharatiya Mahila Bank with State Bank of India.
• It also pointed out that establishment of NARCL would help in cleaning up legacy burden of bad loans from
PSBs’ balance sheets.
• It also pointed out that recently constituted NABFiD would provide alternative channel of infrastructure
funding, thus reducing asset liability mismatch concerns of PSBs.
• Overall, this bulletin said, these reforms were likely to help strengthen PSBs further.
• Thus, it said that against backdrop of these findings, big bang approach of privatisation of these PSBs may
do more harm than good.
→ Initiative taken by Government:
 Amalgamation / merger of PSU banks. Capital injection e.g. recent recapitalisation bonds. governance reforms.
→ Implication:
 Only few State-owned PSU banks would remain. Effective and Efficiency in management, control, operation etc.
Free up government.
→ Way Forward:
 One RBI bulletin in 2022 warned that big-bang privatisation of PSBs can do more harm than good and
asked government to take careful approach on this issue. This bulletin also said that gradual approach
to privatisation adopted by government could ensure that void was not created in fulfilling social
objective of financial inclusion and monetary transmission.
 Many committees proposed to bring down government stake in PSU banks to below 51%: Narasimham
Committee, 1990s suggested about 33%; P.J. Nayak Committee, 2010s suggested about 50%.
 Private ownership alone does not automatically generate economic gains in developing economies’ and more
cautious and nuanced evaluation of privatization is required.
 Arguments against corporate owning banks:
→ Allowing large corporates to open their own banks is basic conflict of interest. It may lead to “connected
lending”. Conflicted structure of ownership: Former RBI Governor Raghuram Rajan observed that it would
be foolish to replace poor governance under present structure of public sector / government-owned banks with
highly conflicted structure of ownership by industrial houses. Historically, RBI is of view that ideal ownership
status of banks should promote balance between efficiency, equity and financial stability. There is risk
when there is greater play of private banks. Example - global financial crisis 2008. Usually, government -
owned banking system are more financially stable [because of trust in government as institution].
 Mobile Banking:
→ What:
 Mobile banking is one service provided by bank or other financial institution that allows its customers
to conduct financial transactions remotely using mobile device such as smartphone or tablet. Unlike
related internet banking it uses software, usually called app, provided by that financial institution.
Mobile banking is usually available on 24-hour basis. Some financial institutions have restrictions on
which accounts may be accessed through mobile banking, as well as limit on amount that can be
transacted. Mobile banking is dependent on availability of internet or data connection to mobile
device.
Page 538 of 719
 Mobile banking differs from mobile payments, which involves use of mobile device to pay for
goods or services either at point of sale or remotely, analogously to use of debit or credit card to effect
Electronic funds transfer at point of sale (EFTPOS) payment.
→ Status of Mobile banking in India:
 26% of Indian adults have digital bank account and is expected to hit 39% by 2023 and 46% by 2027.
 According to one 2020 Statista survey of 5000 odd households across 25 States in India, 2/3 rd of
respondents said they had smartphone.
→ Issue:
 Mobile banking Trojans.
 Cyber threat to mobile banking: Lack of adequate cybersecurity and lack of talent in banking could
potentially lead to further rise in cyberattacks on user devices. As cash transactions become thing of
past, increasing number of people’s interactions with their bank or bank accounts ha ppen through
their smartphones. [According to one 2020 Statista survey of 5000 odd households across 25 States in
India, 2/3 rd of respondents said they had smartphone]. In 2022, Global cybersecurity firm Kaspersky
warned of increase in cyberattacks on Android and iOS devices in Asia Pacific (APAC) region.
Example - Anubis mobile banking trojan virus has been targeting Android users since 2017.
Roaming Mantis is another prolific malware / smishing targeting mobile banking users. BianLian
Malware is one Android banking trojan 1 st seen in 2018 as one dropper (one malicious app that
contains additional malicious app(s) within its payload) for Android malware and i t evolved to
bypassing security protocols within official Google Play store).
 Interoperability: Countries are trying to make payments from one platform to other interoperable
which is also increasing problems. Example – China ordered its internet companies to offer their rival
firms link and payment services on their platforms. India’s one new law demands all licensed mobile
payment platforms to be capable of providing interoperability between wallets.
→ Way forward:
 Careful and extremely cautious when using mobile device to make payments. Usual digital hygiene
practices like keeping phone up-to-date and rebooting regularly. Users should ensure they use their
phones for banking only when device is connected to secure VPN. iOS 16 users can turn on Lockdown
Mode as it limits device’s functionality and protects it from any potential malware.
 Bank run / Run on bank:
→ What:
 Bank run occurs when many clients withdraw their money from a bank, because they believe the bank may cease
to function in the near future. In other words, it is when, in a fractional-reserve banking system (where banks
normally only keep a small proportion of their assets as cash), numerous customers withdraw cash from deposit
accounts with a financial institution at the same time because they believe that the financial institution is, or
might become, insolvent; they keep the cash or transfer it into other assets, such as government bonds, precious
metals or gemstones.
When they transfer funds to another institution, it may be characterized as a capital flight. As a bank
run progresses, it may become a self-fulfilling prophecy: as more people withdraw cash, the likelihood of default
increases, triggering further withdrawals. This can destabilize the bank to the point where it runs out of cash
and thus faces sudden bankruptcy.
A bank run occurs when a large number of customers of a bank or other financial institution withdraw
their deposits simultaneously over concerns of the bank's solvency. As more people withdraw their funds, the
probability of default increases, prompting more people to withdraw their deposits. In extreme cases, the bank's
reserves may not be sufficient to cover the withdrawals.
→ Measure:
 To combat a bank run, a bank may limit how much cash each customer may withdraw, suspend withdrawals
altogether, or promptly acquire more cash from other banks or from the central bank.
 2022 Noble winners - Douglas W Diamond and Philip H Dybvig say that Bank runs can be prevented if govt.
provides deposit insurance and acts as one lender of last resort to banks. [Ex. India provides Rs. 5 Lakh deposit
insurance].
 Issue:
→ Automation has impacted lower-level jobs in banks. ATM usage, mobile and online transactions, and fewer
new bank branches have led to reduced recruit ment. Finance Ministry asked heads of public sector banks
(PSBs) for plan to improve employee count. Business Line (newspaper) reported that vacancies announced
for clerical posts had significantly decreased in year 2022, and it also showed declining inter est in bank
jobs, with increasingly fewer candidates registering for recruitment / selection programmes. All India Bank
Employees Association carried out strike insisting that recruitment of workers be increased, among other
demands. These strikes and news reports together show that problem of declining manpower has reached
inflection point. In fact, cutback on hirings is more noticeable among clerks and sub -staff, while number
of officers has remained constant. This trend was observed in both PSBs and priv ate sector banks (PVBs).
However, it is worth noting that number of officers in PVBs is 3 times higher than in PSBs.
Page 539 of 719
Note:
 Scheduled Bank:
→ What:
 banks included in 2nd Schedule of Reserve Bank of India Act, 1934.
→ Benefits:
 Scheduled bank enjoys 2 types of principal facilities: It becomes eligible for debts/loans at bank rate from RBI;
and It automatically acquires membership of clearing house.
 Co-Operative Bank / Cooperative Bank:
→ What:
 Cooperative banking is retail and commercial banking organized on cooperative basis. Cooperative
banking institutions take deposits and lend money in most parts of world. Cooperative banking
includes:
• retail banking - carried out by credit unions, mutual savings banks, building societies, cooperatives;
• commercial banking services - provided by mutual organizations (such as cooperative federations) to
cooperative businesses.
 In India, Co-operative Banks are small financial institutions that offer lending fac ilities to small
businesses in both urban and non-urban regions. Co-operative bank is one financial entity which
belongs to its members, who are at same time owners and customers of this bank.
→ Laws:
 In India, Co-operative Banks are monitored and regulated by RBI and come under Banking Regulations
Act, 1949 as well as Banking laws (Application to Co-operative Societies) Act, 1965. In 1965, via this
Banking laws (Application to Co-operative Societies) Act, 1965, certain provisions of Banking Regulation Act,
1949 were made applicable to co-operative banks which gave RBI some powers to regulate co -
operative banks. This was done to protect interests of depositors and extend deposit insurance
coverage to co-operative banks. In Banking Regulation Act, 1949, "Co-operative Bank" means Central
Co-operative Bank, State Co-operative Bank, and primary Co-operative Bank.
→ Governance:
 Co-operative Banks are registered under Cooperative Societies Act of State concerned (say Manipur
Cooperative Societies Act, 1976) or Multi-State Cooperative Societies Act, 2002. Co-operative Banks
are governed under Banking Regulations Act, 1949 and Banking Laws (Cooperative Societies) Act, 1955.
→ Types:
 Central Co-operative Banks:
• Central co-operative banks are organized and operated at district level and can be of 2 types:
 Co-operative Banking Union: Its members are co-operative societies only.
 Mixed control Co-operative Bank: Its members can be co-operative societies, individuals.
• Central co-operative banks lend money mainly to affiliated primary societies with typical loan tenure lending
between 1 to 3 years.
 State Co-operative Banks (SCB):
• State Co-operative Banks are organized and operated at district level and are at top of hierarchy in co-
operative credit structure. With help of SCBs, RBI funds co-operative institutions. SCBs also get loans at
interest rate of 1% to 2% lower than standard bank rate.
 Primary Co-operative Banks:
• Primary Co-operative Banks offer credit services in urban and semi-urban regions. Thus, they are not
considered agricultural credit societies. Primary Co-operative Banks receive concessional refinance services
from RBI, IDBI from time to time for them to offer housing loans and other types of loans that can be used
by small businesses.
 Land Development Banks:
• Land development banks are divided into 3 tiers which are: central, State, primary. These offer credit
services to farmers for developmental purposes. They were earlier regulated by RBI and State governments,
however, this responsibility is transferred to NABARD.
→ Cooperative Credit Institutions:
 Rural Cooperative Credit Institutions:
• <Short term structure>:
 State Cooperative Bank; District Central Cooperative Bank; PACS.
• <Long term structure>:
 State Cooperative Agriculture & Rural Development Banks; Primary Cooperative Agriculture and Rural
Development Banks.
 Urban Cooperative Banks.
→ Features:
 Co-operative Banks are customer owned: Co-operative bank members are both customer and owner
of bank. Democratic in nature: Co-operative members also own it and they democratically elect board

Page 540 of 719

 of directors. Members usually have equal voting rights, (as per principle of one person, one vot e).
Profit distribution: Part of profit, benefits or surplus is usually allocated to constitute reserves and
part of this profit can also be distributed to co -operative members. Co-operative Banks play important
role in financial inclusion of unbanked rura l masses.
 Based on lending type, Co-operative Banks can also be classified as:
• Agricultural Credit Institutions:
 Here, State Co-operative Banks (Apex Bank), Central Co-operative Banks (Central Unions), and
Primary Credit Societies (cover towns, villages) provide short-term credit needs, whereas Land
Development Banks provide long-term credit needs.
• Non-Agricultural Institutions.
→ Status:
 As per RBI, as of 2019, there are 1,544 urban co -operative banks, and 96,248 rural co-operative banks
in India.
→ Performance:
 One 2013 ILO report concluded that cooperative banks outperformed their competitors during
financial crisis of 2007–08.
→ Need for modernization of cooperative banks:
 Negligible participation: There were about 195 cooperative banks which were more than 100 years
old. Despite this, role of Urban Cooperative Banks (UCB) is negligible in total banking sector in terms
of deposit and advance payment. UCBs account for only 3.25% of total bank deposits and 2.69% of
total advances in India.
 Symmetric development of Urban cooperative: There are 1,534 UCB, and 54 scheduled UCB but their
development is uneven. Symmetric development of cooperative banks will help sustain competition in
future.
 Need to look after small and marginal sections: Urban State Cooperative Banks need to be
strengthened for upliftment of small and marginal sections, and to make them participants in process
of development and stakeholder in India’s economy.
→ Significance:
 Co-operative Banks are important for small businesses as these banks have around 67% penetration
in villages, and account for 46% of net funding for rural businesses through support f or processing,
housing, warehousing, transport, dairy, etc.
→ Way Forward:
 Adopt modern and transparent banking methods to stay in competition e.g. computerization of accounting
process. Engage younger people in management roles. Engage professionals to run day-to-day affairs. Treating
UCB equally in government policies in respect of taxation, Banking Regulation Act, 1949 or RBI’s norms.
Undertake institutional reforms like transparency in recruitment and implementation of robust accounting
system, which is necessary for their growth. Responsibility lies with cooperative sector: It is cooperatives’
responsibility to establish trustworthiness and earn people’s faith as well as win confidence of RBI and
government.
 Small Finance Bank (SFB):
→ What:
 banks that provide financial services to India’s underserved and unbanked areas. [Example - small business units,
small and marginal farmers, micro and small industries, unorganised sector entities]. one type of niche banks in
India. registered as public limited company under Companies Act, 2013.
→ Aim:
 financial inclusion to sections of economy not being served by other banks.
→ Estd:
 based on Nachiket Mor committee on financial inclusion.
→ Feature:
 can accept deposits of any amount; can lend but focus should be on small lend ing; Can finance small
business units, small and marginal farmers, micro and small industries, unorganised sector entities;
Can provide remittances; Can provide credit cards; can engage in all basic banking activities (lending,
accepting deposits, etc) [like commercial banks]; cannot extend big loans; cannot float subsidiaries;
cannot trade in high-tech products; Can distribute products – mutual fund, insurance, pension.
 Accrediting agency bank:
→ Choice / power of accrediting agency bank for any particular government agency business lies solely with
Centre / State governments.
 Payments Bank / Payment Bank:
→ What:
 New model of banks, conceptualised by RBI (based on 2013 Nachiket Mor Committee), which cannot
issue credit. Bharti Airtel set up India's 1st payments bank (Airtel Payments Bank).

Page 541 of 719

 → Need:
 established to promote financial inclusion by offering - small savings accounts; and payments /
remittance services - to migratory labour workforce, low-income households, small enterprises,
unorganised sector entities, etc.
→ Aim:
 financial inclusion
→ Feature:
 cannot issue loans and credit cards; Cannot lend in any form; can accept restricted deposit [currently Rs. 2 lakh
per customer]; Current account and savings account can be operated; Can provide remittance services; can issue
ATM cards, debit cards; can provide online or mobile banking; Can distribute products – mutual fund, insurance,
3rd-party loan.
 Airtel Payments Bank:
→ subsidiary company of Bharti Airtel. One Indian payments bank. headquarters - New Delhi. In 2022, it was
granted scheduled bank status by RBI under 2 nd schedule of RBI Act, 1934. among fastest-growing digital
banks in India, with base of 115 million users. It offers digital solutions through “Airtel Thanks app” and
retail network. It is in profit.
 India Post Payments Bank (IPPB) [2018]:
→ What:
 One division of India Post which is under ownership of Department of Post, which is one department under
Ministry of Communications, Government of India. payments bank of Indian postal department which works
through network of post offices and nearly 4 lakh postmen.
→ Vision:
 To build most accessible, affordable, trusted bank for common man in India.
→ Mandate:
 To remove barriers for unbanked and under-banked and reach last mile.
→ Feature:
 It is governed by RBI. This bank has more than 5 crore customers. 100% equity owned by Government of India.
IPPB is committed to providing boost to less cash economy and contribute to vision of Digital India.
 Domestic Systemically Important Banks (D-SIBs):
→ What:
 ‘too big to fail’. economic importance. national importance.
→ Origin:
 adopted in aftermath of 2008 financial crisis where collapse of many systematically important banks
in world further fueled financial downturn.
→ Classification:
 RBI finalizes D-SIBs after considering factors like size, complexity, lack of substitutability,
interconnectedness. RBI classifies D-SIBs into 5 buckets according to their importance to Indian
economy. D-SIB bank needs to have assets > 2% of national GDP.
→ Regulations:
 D-SIB should maintain higher risk-weighted assets as tier-I equity.
→ Feature:
 banks enjoy certain advantages in funding. banks have different policy measures regarding systemic risks, moral
hazard issues. In events of distress, government supports D-SIBs.
→ Status:
 SBI, ICICI Bank, HDFC Bank.
→ Significance:
 D-SIBs are important for India’s economy. If D-SIB fails, it would lead to disruption of India’s overall economy.
→ Fact:
 Financial Stability Board (FSB) [2009] in consultation with Basel Committee on Banking Supervision (BCBS) and
national authorities, identifies Global Systemically Important Banks (G-SIBs) since 2011.
 Banking laws (Application to Co-operative Societies) Act, 1965:
→ Act that amended Reserve Bank of India Act, 1934 and erstwhile Banking Companies Act, 1949 (Banking
Regulation Act, 1949) for purpose of regulating banking business of certain cooperative societies.
→ This Act made certain provisions of Banking Regulation Act, 1949 applicable to co-operative banks. This
gave RBI some powers to regulate co-operative banks. This was done to protect interests of depositors and
extend deposit insurance coverage to these banks.
 Primary Agricultural Credit Society (PACS):
→ What:
 PACS is basic unit and smallest co-operative credit institution in India. It works on grassroots level (gram
panchayat, village level). It is village-level institution that works directly with rural residents. It encourages

Page 542 of 719

 agriculturists to save, accepts deposits from them, makes loans to deserving borrowers, and collects
repayments.
→ Feature:
 PACS are lowest unit in 3-tier structure, other two being - State Cooperative Bank, District Central Cooperative
Bank (DCCB).
 It is one village-level institution that works directly with rural residents. It encourages agriculturists to save,
accepts deposits from them, makes loans to deserving borrowers, and collects repayments.
→ Digitization of PACS:
 In 2022, Cabinet approved digitisation of 63,000 PACS. Its benefits:
• Computerisation will bring transparency and link all credit societies to one common accounting system.
• Each PACS will get around Rs. 4 lakh to upgrade its capacity and even old accounting records will be digitised
and linked to cloud-based software.
• Service delivery: DBT, Interest Subvention Scheme (ISS), Crop Insurance Scheme (PMFBY), and inputs like
fertilizers and seeds could be taken up.
[State Cooperative Bank and District Central Cooperative Bank (DCCB) have already been automated by NABARD
and brought on Core Banking Software (CBS)].
→ Status:
 GOI (Min. of Cooperation) plans to amend model bye-laws that would govern PACS in respective States
(Cooperative is State subject).
 Parliament to amend Multi-State Co-operative Societies Act, 2002.
 GOI plans to set up one National University for Cooperative Management (National Cooperative University).
 In 2022, Union Cooperation Minister Amit Shah said that PACS will be set up in all panchayats of India
over next 5 years to boost activities such as marketing of dairy products. He also said people of NE
India will benefit great deal from this.
 In 2022, Union Cooperation Minister Amit Shah said there were only 65,000 active PACS;
→ Significance:
 PACS account for 41% (3.01 crore farmers) of Kisan Credit Card (KCC) loans given by all entities in India.
 PACS promote farming and dairy activities at grassroots level.
 PACS will carry out activities like sale of gas and petrol and storage and marketing of dairy and farm products
with aim to alleviate poverty and empower women.
→ Fact:
 Manipur has about 90 PACS.
 State Cooperative Banks and District Central Cooperative Banks (DCCB) have already been automated by
NABARD and brought on Common Banking Software (CBS).
 Urban Co-operative Banks (UCB):
→ RBI appointed committee categorised Urban Co-operative Banks (UCB) into 4 tiers for regulatory purposes:
 Tier 1 (having deposits up to Rs. 100 crore)
 Tier 2 (deposits between Rs. 100 crore and Rs. 1,000 crore)
 Tier 3 (deposits between Rs. 1,000 crore and Rs. 10,000 crore)
 Tier 4 (deposits more than Rs. 10,000 crore)
→ For UCBs minimum CRAR could vary from 9% to 15% and Tier-4 UCBs has to follow Basel III prescribed norms.
 Regional Rural Banks (RRBs) [1975]:
→ What:
 RRBs are government owned scheduled commercial banks of India that operate at regional level in different
States of India. RRBs are under ownership of Ministry of Finance. They were created to serve rural areas with
basic banking and financial services. However, RRBs also have urban branches. It was formed under Regional
Rural Banks Act, 1976 [recommended by Narasimha Working Group (1975)], for providing credit in rural areas.
→ Example:
 1st RRB “Prathama Grameen Bank” [1975].
→ Feature:
 Area of operation is limited to area notified by GOI covering, and it covers one or more districts in State. RRBs
perform various functions such as providing banking facilities to rural and semi-urban areas, carrying out
government operations like disbursement of wages of MGNREGA workers and distribution of pensions,
providing para-banking facilities like locker facilities, debit and credit cards, mobile banking, internet banking,
and UPI services. Ownership: Central Government (50%), Concerned State Govt. (15%), Sponsor Bank (35%). RRB
follows priority sector lending. Unique thing: RRBs combine characteristics of cooperative in terms of familiarity
with rural problems and commercial bank in terms of its professionalism and ability to mobilise financial
resources. RRBs are to maintain CRAR of minimum of 9% (at par with commercial banks).
→ Issue:
 Most of RRBs are in loss, poor management practices, NPA is increasing and lacks unity of command (being
controlled by govt. as well as sponsor banks such as NABARD, RBI).
Page 543 of 719
 → Significance:
 RRBs provide banking to rural masses, support weaker sections (through credits), direct finance to cooperative
societies and SHGs, reduce regional imbalances and increase rural employment generation.
 Mobile banking Trojan:
→ It is one of most dangerous species in malware world. It steals money from mobile users’ bank accounts. Mobile
banking Trojans are dangerous malware that can steal money from mobile users’ bank accounts by disguising
malicious application as legitimate app to lure unsuspecting people into installing malware. [Trojan is malicious code
or software that looks legitimate but can take control of our device, including smartphones]. Perpetrators infect
device through legitimate-looking and high-ranking malicious apps on Google Play, smishing (phishing messages sent
through SMS).
 EASE Reforms for Public Sector Banks [2018]:
→ What:
 It is Enhanced Access and Service Excellence. EASENext is called CLEAN & SMART Banking for Aspiring India
and was launched by FM Nirmala Sitharaman in 2022. EASENext reforms is for state run lenders (PSBs).
EASENext would comprise 2 major initiatives: EASE 5.0 (common PSB reforms agenda); and Bank
specific 3-year strategic roadmap.
EASE is one reform agenda for PSBs for CLEAN & SMART Banking. Stages are: Ease 1.0
(resolution of NPA); Ease 2.0 (Responsible banking, financial inclusion, digitalization); Ease 3.0 (Dial -
loan, Credit@click, PSBloansin59minutes.com); Ease 4.0 (24X7 banking, focus on north-east, bad
banks), and now EASE 5.0 (common PSB reforms agenda).
→ Feature:
 PSB’s performance are reviewed under EASENext reforms (currently Ease 5.0) by Finance Ministry.
 Nodal Agency: Indian Bank’s Association (IBA).
→ Fact:
 Here, CLEAN Banking means – Clean credit, Leveraging data, Ensuring accountability, Action against defaulters,
NPA recovery; and SMART Banking means – Speedy, Multi-channel reach, Accessible & affordable; Responsive,
Technologically enchanced.
Glossary:
 Universal Banking:
→ system in which banks provide wide variety of financial services: investment services / banking, commercial banking,
development banking, insurance, merchant banking, mutual funds, housing finance etc.
 Connected Lending:
→ situation in which bank's controlling owner extends loans of inferior quality at lower interest rates to
himself or his connected parties. situation where promoter of bank is also borrower and, thus, it is possible
for promoter to channel depositors’ money into his own ventures. India: Connected Lending has been
happening for long time in India. Recent episodes in ICICI Bank, Yes Bank, DHFL etc. were all examples of
connected lending. So-called ever-greening of loans is often starting point of Connected lending.
 Ever-greening of loans:
→ one loan after another is extended to enable borrower to pay back previous loan
 Nationalization / Nationalisation / Collectivization:
→ It is process of transforming privately-owned assets into public assets by bringing them under public ownership of
national government or state. Nationalization usually refers to private assets or to assets owned by lower levels of
government (such as municipalities) being transferred to state. Nationalization contrasts with privatization and with
demutualization. When previously nationalized assets are privatized and subsequently returned to public ownership
at later stage, they are said to have undergone renationalization. Industries often subject to nationalization include
commanding heights of economy - telecommunications, electric power, fossil fuels, railways, airlines, iron ore,
media, postal services, banks, water - though, in many jurisdictions, many such entities have no history of private
ownership.
→ It is process in which government of country or state takes control of specific company or industry.
Question:
 Payments bank is like any other bank but operates on smaller scale without involving any credit risk. In simple
words, it can carry out most banking operations but can’t advance loans (cannot lend) or issue credit cards.
 Urban Cooperative Banks (UCB) in India are supervised and regulated by RBI. UCB can issue equity shares and preference
shares. UCB were brought under purview of Banking Regulation Act, 1949 through Amendment in 1966.
 One of most important functions of District Central Cooperative Banks (DCCBs) is to provide funds to PACS.
 In India, which of following have highest share in disbursement of credit to agriculture and allied activities?
→ Commercial Banks; Cooperative Banks; RRBs; Microfinance Institutions
Answer: Commercial banks (Commercial banks is around 60%, Cooperative banks is around 30%).
 Basic aim of Lead Bank Scheme is that individual banks should adopt particular districts for intensive development. Lead
Bank Scheme, introduced in year 1969, envisages assignment of lead roles to individual banks for districts allotted to
them.

Page 544 of 719

  Reasons for Privatization of Banks are - Degrading Financial Position of Public Sector Banks, etc. Many of PSB’s have higher
levels of stressed assets than private banks, and also lag latter on profitability, market capitalization and dividend
payment record. Privatization of public sector banks will set ball rolling for long-term project that envisages only handful
of state-owned banks, with rest either consolidated with strong banks or privatized. Private sector banks concentrate on
more affluent sections of population and metropolitan / urban areas, leading to financial exclusion of weaker sections of
society, particularly in rural areas.
Mains Link:
 Bank nationalisation: Blunder or masterstroke? What were the factors that led to the nationalisation of banks? Examine
its impact on economic development and job creation. (15M)
 Co-operative banks in India form the backbone for the delivery of credit to rural areas. However, for cooperative banks
to be regulated and supervised better, RBI needs to ramp up its supervisory capacity. Elucidate. (15M)
 Analyse the role of Cooperative societies as an economic driver toward national development. (10M)

NON-PERFORMING ASSET (NPA)

News:
 2002:
→ RBI introduces PCA framework for scheduled commercial banks.
 2021:
→ Budget 2021-22 proposes to set up bad bank.
→ RBI takes IDBI Bank Ltd. out of its PCA list.
→ RBI issues revised PCA framework for banks to enable supervisory intervention at “appropriate time” and also act as
tool for effective market discipline.
→ RBI sets up committee headed by Sudarshan Sen to review ARCs.
→ Lenders – banks, FIs – decide to transfer bad loan accounts – about Rs. 2 trillion - to proposed National Asset
Reconstruction Company Ltd. (NARCL), aiding cleanup of their balance sheets.
→ Government sets up new entities to acquire stressed assets from banks and then sell them in market.
→ To make NARCL-IDRCL structure work, GOI okays use of X crores to be used as government guarantee.
→ RBI introduces PCA framework for Non-Banking Financial Companies (NBFCs).
 Reason:
• 4 big finance firms — IL&FS, DHFL, SREI, Reliance Capital — collected public funds through fixed deposits,
non-convertible debentures and they collapsed in recent years, despite tight monitoring in financial sector.
Said 4 firms collectively owe about Rs 1 lakh crore to investors.
 2022:
→ NARCL will pick up 1 st set of NPAs in 2022.
→ RBI puts Dhanlaxmi Bank under observation due to decreasing CRAR of the Bank. [As NPA increases →
asset quality decreases → Risks Weighted Assets increase → and so Bank would need to increase their
CRAR to maintain the confidence of the market. In Dhanlaxmi bank, NPA increased b ut CRAR decreased.
Hence RBI took it under its direct observation].
About:
 What:
→ NPA refers to classification for loans or advances that are in default or in arrears. Loan is in arrears when
principal or interest payments are late or missed. Loan is in default when lender considers loan agreement
to be broken and debtor is unable to meet his obligations.
→ Non-Performing Loan (NPL) is bank loan that is subject to late repayment or is unlik ely to be repaid by
borrower in full. NPL represent major challenge for banking sector, as it reduces profitability of banks, and
is often presented as preventing banks from lending more to businesses and consumers, which in turn
slows down economic growth (although this theory is disputed).
→ Banks and other financial institutions are required to classify debts owned by them into following 4
categories:
 Standard debt
 Sub-standard debt
 Doubtful debt
 Loss debt.
Out of said 4 categories, NPA would be either sub-standard, doubtful or loss asset.
 Term:
→ In most cases, debt is classified as NPA when loan payments have not been made for minimum period of
90 days (RBI defines NPA as any advance or loan that is overdue for more than 90 days. Asset becomes
NPA when it ceases to generate income for bank).
→ Gross NPA (GNPA) are sum of all loans that have been defaulted by individuals who have acquired loans
from that financial institution.
→ Net NPA (NNPA) = GNPA - provisions made by bank. That is, NNPA is exact value of NP A after bank has
made specific provision for it.
Page 545 of 719
 Background:
→ As per Indian Economy by Ramesh Singh, to solve crisis of high NPAs, RBI introduced many schemes over
years:
 Flexible Refinancing of Infrastructure (5/25 scheme)
 Asset Reconstruction Companies (ARC)
 Strategic Debt Restructuring (SDR)
 Asset Quality Review (AQR)
 Scheme for Sustainable Structuring of Stressed Assets (S4A)
But these conventional measures have not brought desired relief to banks and thus Government is setting
up less conventional remedy like Bad Bank.
 Status:
→ The Indian banking system faced a significant challenge after 2011 with an increasing quantum of NPAs. By late 2000s,
NPAs (as a % of gross advances) had decreased to < 3.5%. The downward trend, however, did not continue as NPAs
began to rise in 2011 and peaked at 11.18% in 2018. As expected, this rise occurred with the deterioration of the
balance sheets of non-financial firms, and this twin balance sheet crisis contributed significantly to the deceleration
of growth in the late 2010s.
 Reason behind rise in NPA during period of 2011 -18:
• Poor management and governance issues stemming from government ownership of PSBs.
• Higher exposure to commodity-sensitive markets such as iron and steel, and textiles.
• Difference in the Business model. Eg. PSBs have to cater to rural and poor segments as well.
• Fall in international commodity prices, thereby reducing the revenue of many Indian firms.
Thus, a large proportion of NPAs arose because of external ori gin shocks, which have nothing to do
with management and governance issues in PSBs only.
 Measure:
→ Below models of Bad Bank can be used to decrease NPA of bank:
 On-balance-sheet guarantee:
• In this model, stressed bank gets loss guarantee from government for its bad assets. But, said bad
loans remain on balance sheet of bank. It means while bank gets confident about its bad assets, it
is still not in position to start fresh lending. This is simple and less expensive format and can be
implemented quickly. But this model is not fit in India.
 Internal restructuring unit:
• This model is like creating bad bank inside stressed bank itself. Bank puts its bad debts in separate
unit inside its own financial structure and set up separate management team to handle its bad
assets. This helps bank increase transparency (because information about bad loan becomes
public) and boosts confidence among shareholders. It however fails to enable bank to restart fresh
lending. This model is also not suitable for India.
 Special-purpose entity:
• In this model, bad loans are offloaded from balance sheet of bank and securitized into fund that
is sold off to financial investors. In case of India, said securitized bad loans can be run through
sector-specific Special Purpose Vehicle (SPV). In India, this model is useful because NPAs are
concentrated in some sectors like Infrastructure, metals. It involves market for pricing of
securitized bad assets and thus Public Sector Banks (PSB) will attract less blame. As balance sheet
of bank becomes clean, it can start fresh lending.
 Bad-bank spin-off:
• This is most familiar model used in world. In this model, stressed bank shifts its bad loans to one
separate banking body (bad bank). This allows transfer of risk of bad loans to bad bank and thereby
making stressed bank viable to start fresh lending. This model looks most suitable for India, but
this model is expensive. Public Sector Asset Rehabilitation Agency (PARA) suggested by Economic
Survey 2016-17 falls under this model.
 Way Forward:
→ Creation of separate body in line of PARA as suggested by Economic Survey 2016-17. But, set up of bad bank will
only address problem of stressed bank’s bad debt and may make it fi t to restart lending. But this will not
solve cause of investment lending problem in economy because some big corporates are unfit and are in
loss. This means India needs to leverage both stressed banks and corporate entities.
 Asset Reconstruction Company (ARC):
→ What:
 specialized financial institution that buys NPAs from banks and financial institutions (FI) so that banks
/ FIs can clean up their balance sheets.
 ARCs are registered under RBI (RBI has power to regulate ARCs).
 ARC is one special type of financial institution that buys debtors of bank at mutually agreed value and
attempts to recover debts or associated securities by itself. ARCs are registered under RBI and

Page 546 of 719

 regulated under Securitisation and Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 (SARFAESI Act, 2002). ARCs take over portion of debts of bank that qualify to be
recognised as NPA. Thus ARCs are engaged in business of asset reconstruction or securitisation or
both. All rights that were held by lender (bank) in respect of that debt would be transferred to ARC.
Required funds to purchase such debts can be raised from Qualified Buyers.
 ARCs are in business of acquiring assets and attempts to reconstruct these assets over time to find
potential buyers.
→ Background:
 Banks are financial institutions that are engaged principally in business of money lending and money
borrowing. Customer base of banking sector is very large and there is also substantial risk involved in
lending money. While bank always has option of taking legal action on defaulting borrowers, it is not
always economically feasible to do so. Bank sometimes decides to just cut its losses, clean up its
balance sheet and keep business moving towards better avenues. This is where Asset Reconstruction
Company (ARC) comes in.
 Concept of ARCs has been around for many years in India.
→ Aim:
 Main intention of acquiring debts / NPAs is to ultimately realise debts owed.
→ Legal basis:
 Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 /
SARFAESI, Act 2002: This Act helps reconstruction of bad assets (NPAs) without intervention of courts.
→ Example:
 In India, oldest ARC is Asset Reconstruction Company India Ltd. (Arcil). In fact, Arcil (private company) is also
owned by some financial institutions including SBI, IDBI Bank, ICICI Bank (ICICI), Punjab National Bank (PNB),
Avenue India Resurgence Pte.
→ Need:
 Total stress in India’s banking system is about Rs 15 lakh crores.
 Banks burdened with stressed assets and limited capital face difficulty in managing NPAs.
 Government can provide only limited capital.
 Thus, bad bank model can help both government and banks.
→ Capital:
 SARFAESI Act, 2002 says ARC should have minimum fund of Rs. 2 crores. In 2017, RBI raised this amount
to Rs. 100 crores Also, ARCs should maintain Capital Adequacy Ratio (CAR) of 15% of its risk weighted
assets.
→ Function:
 buying of stressed assets from banks / FIs.
 resolution of stressed assets – including under IBC, 2016.
→ Working Mechanism:
 Banks offer financial assistance to borrowers and in return borrowers provide security for such financial
assistance.
 When that becomes NPA, banks transfer bad debts / NPA to ARC and in return, ARC purchases such NPA.
 ARC then sells security receipts of such NPA to Qualified Buyer.
→ Process of Asset Reconstruction:
 Main intention of acquiring debts / NPAs is to ultimately realise debts owed. However, this process is not simple
one. ARCs have following options in this regard:
• Change or takeover of management of business of borrower. Sale or lease of such business.
• Rescheduling payment of debts – offering alternative schemes, arrangements for payment.
• Enforcing security interest offered in accordance with law.
• Taking possession of assets offered as security.
• Converting portion of debt into shares.
→ Debt type that ARC can take over:
 ARC can take over only secured debts which have been classified as NPA. In case debentures / bonds remain
unpaid, beneficiary of securities is required to give notice of some days before it qualifies to be taken over.
→ Significance:
 ARCs help banks to concentrate in normal banking activities.
 Instead of going after defaulters by wasting their time and effort, banks can sell bad assets (NPAs) to ARCs at
mutually agreed value.
 Bad Bank:
→ What:
 Bad bank is one corporate structure which isolates illiquid and high risk assets (typically n on-
performing loans) held by bank or financial organisation, or perhaps group of banks or financial
organisations.
Page 547 of 719
  It is bank that buys bad loans and other asset holdings of another Financial Institution (FI).
 Entity holding NPA sells these holdings to bad bank at market price.
 By transferring such NPA to bad bank, original FI clears its balance sheet via write -downs.
 Bad bank then sells taken-over stressed loans from banks, to Alternative Investment Funds (AIF).
→ What it does?
 Bank Bank buys or takes over bad loans of bank (while good loans are left with bank itself). Bad bank
will absorb existing stock of NPAs of banks and will attempt resolution through professional approach.
→ Example:
 NARCL-IDRCL structure is new bad bank of India.
→ Aim:
 Improvement of banking sector health i.e., to improve health of country’s banking sector.
 Resolve NPA problem.
 To help banking system get rid of existing stock of problematic loans.
→ Need:
 Total stress in India’s banking system is about Rs 15 lakh crores.
 Bad loan:
• Huge drag on economy.
• Drain on banks’profits. Thus, banks are left with less capital to fund credit-growth.
 Banks burdened with stressed assets and limited capital face difficulty in managing NPAs.
 Government can provide only limited capital.
 Thus, bad bank model can help both government and banks.
→ Bad Bank’s Model:
 On-balance-sheet guarantee:
 Internal restructuring unit:
 Special-purpose entity:
 Bad-bank spin-off:
→ Govt.’s mechanism:
 Overview:
• National Asset Reconstruction Company Limited (NARCL) will acquire stressed assets from commercial
banks by making offer (cash + security receipts) to said banks. Here, private sector ARCs may also be allowed
to outbid NARCL. And then, another entity called - India Debt Resolution Company Ltd (IDRCL)will then sell
these stressed assets in market.
 Working mechanism:
• 15% cash payment would be made to banks and rest 85% will be given as security receipts.
• Once NARCL and IDRC finally resolves stressed asset, said balance 85% would be given to banks.
• If bad bank (NARCL-IDRC) is unable to sell bad loan (stressed asset), or sells it at loss, then government
guarantee will be invoked. And, difference between what commercial bank was supposed to get and what
bad bank was able to raise will be paid from government guarantee fund
→ Arguments:

{Merits} {Demerits}
Clearing-off balance sheets of banks / FIs by Write down (haircut):
transferring bad loans, bad bank helps them focus Bad loan is sold at market price < carrying book
on their core business activities i.e. lending value - is loss to original FI that will impact P&L
(Profit & Loss) sheet
Bad bank may solve coordination problem Bad Bank concept is simple but its
because debts would be centralised in one agency implementation and design can be complicated.
RBI signalled in favour of setting up Bad Bank but
it also highlighted concerns designing Bad Bank.
Speedier settlements with borrowers (debtors)
Can take more stringent enforcement action
against debtors
Bad bank can raise money from investors other than
from Government
Government-backed receipts (NARCL- IDRCL) can buy
and sell big stressed assets.
Value locked in stressed assets is realised and comes
back to commercial banks. Then, commercial banks
use it as growth capital. This will make banking system
more robust.
→ Significance:
Page 548 of 719
 
After taking over or buying of its bad loans by Bad Bank, bank is left with good loans and this does not
contaminate its good assets.
 After selling its bad loans to Bad Bank, bank becomes financially viable and c an restart its lending
process.
→ Way forward:
 K.V. Kamath Committee said many sectors are having NPA. Therefore, setting up bad bank is important.
Note:
 Bank for International Settlements (BIS) [1930]:
→ What:
 BIS is an international financial institution owned by central banks that "fosters international monetary
and financial cooperation and serves as a bank for central banks. It is based in Basel, Switzerland, with
representative offices in Hong Kong and Mexico City. Founded in 1930, BIS is t he oldest global financial
institution and operates under the auspices of international law.
→ Objective:
 BIS aims to foster co-operation among central banks with a common goal of financial stability and
common standards of banking regulations.
→ Function:
 The BIS carries out its work through its meetings, programmes and through the Basel Process – hosting
international groups pursuing global financial stability and facilitating their interaction.
 It also provides banking services, but only to central banks an d other international organizations.
 It encourages international monetary and financial cooperation.
 It serves as bank for central banks.
→ Basel Norms:
 What:
• Every 2 months BIS hosts a meeting of the governor and senior officials of central banks of member
countries. Member nations are in the committee [Basel Committee on Banking Supervision (BCBS)]. Basel
guidelines refer to broad supervisory standards formulated by this group of central banks (BCBS).
The set of agreement by the BCBS, which mainly focuses on risks to banks and the financial system are
called Basel accord. The purpose of the Basel accord is to ensure that financial institutions have enough
capital on account to meet obligations and absorb unexpected losses.
India accepted Basel accords for the banking system. In fact, on a few parameters the RBI has prescribed
stringent norms as compared to the norms prescribed by BCBS.
 Basel I:
• In 1988, BCBS introduced capital measurement system called Basel capital accord, also called as Basel 1. It
focused almost entirely on credit risk. It defined capital and structure of risk weights for banks. The
minimum capital requirement was fixed at 8% of risk weighted assets (RWA). [RWA means assets with
different risk profiles. For example, an asset backed by collateral would carry lesser risks as compared to
personal loans, which have no collateral. India adopted Basel 1 guidelines in 1999].
 Basel II:
• In 2004, Basel II guidelines were published by BCBS, which were considered to be the refined and reformed
versions of Basel I accord. The guidelines were based on 3 parameters, which the committee calls it as
pillars:
 Capital Adequacy Requirements: Banks should maintain a minimum capital adequacy requirement of
8% of risk assets.
 Supervisory Review: Banks are needed to develop and use better risk management techniques in
monitoring and managing all the 3 types of risks that a bank faces, viz. credit risk, market risk, and
operational risk.
 Market Discipline: This need increased disclosure requirements. Banks need to mandatorily disclose
their CAR, risk exposure, etc to the central bank.
• Basel II norms in India and overseas are yet to be fully implemented.
 Basel III:
• In 2010, Basel III guidelines were released. These guidelines were introduced in response to the financial
crisis of 2008. [A need was felt to further strengthen the system as banks in the developed economies were
under-capitalized, over-leveraged and had a greater reliance on short-term funding. Also the quantity and
quality of capital under Basel II were deemed insufficient to contain any further risk]. Basel III norms aim at
making most banking activities such as their trading book activities more capital-intensive. The guidelines
aim to promote a more resilient banking system by focusing on 4 vital banking parameters viz. capital,
leverage, funding, and liquidity.
→ India:
 member.
 Basel Committee on Banking Supervision (BCBS) [1974]:

Page 549 of 719

 → BCBS is a committee of banking supervisory authorities that was established by the central bank governors
of the Group of Ten (G10) countries in 1974. As of 2019, the BCBS has 45 members from 28 jurisdictions,
consisting of central banks and authorities with responsibility of banking regulation.
 National Asset Reconstruction Company Ltd. (NARCL) [2022]:
→ What:
 proposed bad bank announced in Budget 2021-22.
 bad bank to house bad loans for taking over stressed assets of lenders (commercial banks).
 It is created in collaboration with both public sector banks and private sector banks.
 It is majority-owned by state-owned banks.
 NARCL will be assisted by India Debt Resolution Company Ltd (IDRCL)
 NARCL has already been incorporated under Companies Act, 2013.
→ Need:
 Total stress in India’s banking system is about Rs 15 lakh crores. Banks burdened with stressed assets and limited
capital face difficulty in managing NPAs. Government can provide only limited capital. Thus, bad bank model can
help both government and banks.
→ Structure / component:
 NARCL will have:
• Asset Reconstruction Company (ARC).
• Asset Management Company (AMC).
→ Concern:
 Initial capital burden will be on banks, mainly PSBs.
→ Significance:
 Many PSBs have in past shied away from transferring NPAs to private ARCs fearing investigations in later stages.
It being Govt. ARC, NARCL bad bank will likely see more participation from PSBs and PSBs will feel safe to do
business with this govt. company.
 Individual banks must sell their stressed assets to ARCs and this process gets stuck because ARCs typically seek
steep discount on loans and thus valuation comes as hurdle. With this proposed bad bank (NARCL), valuation
issue is unlikely to come up because this is government initiative.
 Smaller ARCs do not have ability to do cash deals with respect to big accounts. Hence, banks are often stuck with
these accounts or are forced to move to NCLT court where chances of resolution are relatively less and process
is time-consuming. As against this, this government-backed ARC (NARCL) will have deep pockets (money) to buy
out big accounts and thus free up banks from carrying these accounts on their books.
 Even for existing ARCs, this bad bank (NARCL) is unlikely to be bad news. Once industry bad loans are aggregated
in one entity (NARCL), existing ARCs can negotiate deals with that bad bank (NARCL). Currently, with respect to
consortium loans, ARCs will have to wait for approval from multiple lenders before deal is concluded. This causes
unnecessary delays and cost overruns.
 Being government initiative (NARCL), RBI is likely to extend certain rule relaxations.
 India Debt Resolution Company Ltd (IDRCL):
→ IDRCL would manage ARC-acquired assets.
→ IDRCL will then try to raise their value for final resolution.
→ IDRCL will then sell ARC-acquired stressed assets in market.
→ majority-owned by private banks

NARCL Existing ARC
will have public sector character [idea is started by majority ownership is likely to be with state-owned
government] banks
valuation issue is likely to not occur [since this is typically seeks steep discount on loans
government initiative]
will have high fund to buy out big accounts / loans
[government-backed ARC].

Bad Bank ARC
Idea being floated which basically says that all NPA’s
of all PSB’s be transferred to one new bank called
bad bank. Bad bank’s only function will be to recover,
rephase, or convert NPAs to performing assets. In
this way, all PSB’s will pass their burden to one single
entity
 In 2020, Supreme Court held that cooperative banks involved in activities related to banking are covered within meaning
of ‘banking company’ and Parliament has legislative competence to provide for procedure for recovery of loan under
SARFAESI Act, 2002.

Page 550 of 719

 Asset Reconstruction
→ It is acquisition of any right or interest of any bank or financial institution in loans, advances granted,
debentures, bonds, guarantees or any other credit facility extended by banks for purpose of its realisation.
Such loans, advances, bonds, guarantees and other credit facilities are together known by term – ‘financial
assistance’.
 Securitisation:
→ It is acquisition of financial assets either by way of issuing security receipts to Qualified Buyers or any
other means. Such security receipts would represent undivided interest in financial assets.
 Liquidity Coverage Ratio (LCR):
→ LCR refers to the proportion of highly liquid assets held by financial institutions, to ensure their ongoing
ability to meet short-term obligations. This ratio is essentially a generic stress test that aims to anticipate
market-wide shocks and make sure that financial institutions possess suitable capital preservation, to ride
out any short-term liquidity disruptions, that may plague the market.
→ To be on safe side, LCR should be > or = 1. It means a bank has enough high -quality liquid assets (cash,
gold etc) to survive a high-stress scenario of cash outflow (the bank run) for at least 30 days or more.
 Qualified Buyers (QB):
→ Qualified Buyers include Financial Institutions, Insurance companies, Banks, State Financial Corporation s,
State Industrial Development Corporations, trustee, or ARCs registered under SARFAESI and Asset
Management Companies registered under SEBI that invest on behalf of mutual funds, pension funds, FIIs,
etc. Qualified Buyers (QBs) are only persons from whom ARC can raise funds.
 ‘Scheme for Sustainable Structuring of Stressed Assets (S4A)’:
→ It is one scheme of RBI for reworking financial structure of big corporate entities facing genuine difficulties.
 Prompt Corrective Action Framework / PCA Framework [2002]:
→ What:
 framework (rules) introduced by RBI to enable supervisory intervention at appropriate time and require
supervised entity to initiate and implement remedial measures in timely manner, to restore its financial health.
 structured early-intervention mechanism for banks that become under capitalised due to poor asset quality, or
vulnerable due to loss of profitability.
→ Aim:
 early-intervention mechanism (banks under this list are being watched by RBI)
 Check problem of Non-Performing Assets (NPAs) in Indian banking sector.
→ Feature:
 Under PCA, all commercial banks are monitored for asset quality and capital sufficiency. Accordingly, they are
classified into 3 risk categories (the higher the number, higher the risk).
 All commercial banks and Non-deposit taking NBFCs are covered under the PCA norms of RBI.
 NABARD sets PCA norms for Regional Rural Banks.
 Exit from PCA norms is possible only if no breach is detected in 4 consecutive quarterly audit statements.
 banks with weak financial assets / under-capitalised / poor asset quality / NPA / bad loans / -ve return on assets
/ non-profitabilityetc.are put under it.
 There are 3 risk thresholds.
 Restrictions on banks:
• mandatory restrictions:
 on dividend distribution / remittance of profits
 on branch expansion
 on directors’ compensation
• discretionary restrictions:
 on lending
 on deposit
 on issuance of guarantees
 on capital expenditure
 operating costs.
→ Invokement:
 PCA is invoked when certain risk thresholds, set by RBI, are breached.
 Its some parameters are:
• CRAR
• NPA
→ Bank’s perspective when PCA is triggered:
 Banks are allowed neither to renew / access costly deposits nor increase their fee-based incomes.
 Banks have to take actions to reduce NPAs and contain generation of fresh NPAs.
 Banks are not allowed to enter into new businesses.
 Banks are restricted to borrow from interbank market.

Page 551 of 719

 → 2021 revised PCA framework:
 Key areas for monitoring:
• Capital
• asset quality
• leverage.
 Indicators:
• CRAR / Common Equity Tier I Ratio
• Net NPA Ratio
• Tier I Leverage Ratio
 Capital to Risk (Weighted) Assets Ratio (CRAR) / Capital Adequacy Ratio (CAR):
→ What:
 ratio of bank’s capital to its risk. measure of amount of bank’s core capital. expressed as % of its risk-weighted
asset. decided by central banks / bank regulators to prevent commercial banks from taking excess leverage and
becoming insolvent.
 CRAR measures a bank’s financial stability by measuring its available capital as a % of its risk-weighted credit
exposure.
→ Aim:
 protect depositors
 promote stability financial systems around world
 promote efficiency of financial systems around world
→ Target:
 Basel III norms specify CAR of 8%. However, as per RBI norms, Indian scheduled commercial banks are required
to maintain CAR of 9%.
→ Measurement:
 2 types of capital are measured:
• Tier I capital, which can absorb losses without bank being required to cease trading
• Tier II capital, which can absorb losses in event of winding-up [lesser degree of protection to depositors].
→ Significance:
 National regulators track bank's CAR to ensure that bank can absorb reasonable amount of loss and complies
with statutory Capital requirements.
Value Addition:
 In 2020, Supreme Court held that:
→ meaning of ‘banking’ cannot be confined to particular definition, as given in Banking Regulation (BR) Act,
1949.
→ Word ‘banking’ has been incorporated in List I (Union List) of Constitution.
→ Therefore, cooperative banks come under category of banks, as defined in SARFAESI Act, 2002.
Question:
 Capital conversion buffer and Countercyclical buffer are terms often seen in the context of Bank of International
Settlement.
 RBI can apply Prompt corrective action when Capital to risk-weighted asset ratio of a bank falls below 9%.
Mains Link:
 Discuss the significance of PCA framework.
 Discuss the need for having a PCA Framework for NBFCs.
 Enumerate the steps taken so far to expedite and enable the resolution of NPAs in India. Critically analyse the potential
of National Asset Reconstruction Company Ltd (NARCL) as the “Bad Bank” in addressing the issue of NPAs.
 How far can financial inclusion help in containing the high level of NPAs of banks in India? Substantiate your views with
two examples. (200 words)

REAL ESTATE
News:
 2021:
→ Centre and JK UT government decide to open local real estate to all citizens of India.
 Reason:
• To attract investments from real estate companies.
 2022:
→ NAREDCO forms a NAREDCO Finance Committee (NFC) on the sidelines of NAREDCO 24th Annual General Meeting to
enable developers easy access to funds based on merit and viability of the projects.
 Significance:
• The newly-formed Committee will focus on project financing, which would fulfil the practical requirements
of construction by adhering to the construction cycle.

Page 552 of 719

 • The NFC has been formed to help the industry and developers infuse liquidity into the system and help the
consumers too with ready-to-move-in projects.
About:
 What:
→ Real estate is property consisting of land, buildings on land, land’s natural resources - crops, minerals,
water. Real estate is different from personal property (not permanently attached to land) like - vehicles,
boats, jewellery, furniture, tools, rolling stock of farm etc. In terms of law, real is in relation to land
property and is different from personal property while estate means the "interest" a person has in that
land property.
Note:
 Any citizen of India can buy non-agriculture land in Jammu and Kashmir.
 Real Estate Investment Trust (REIT):
→ What:
 ReIT is one company that owns and typically operates income -producing real estate or related assets.
These may include office buildings, shopping malls, apartments, hotels, resorts, self -storage facilities,
warehouses, and mortgages or loans.
→ Cycle:
 Investors -> REITs (capital used to buy and manage) -> real estate (growth and rental income) -> Profits
-> Investors (dividends).
 National Real Estate Development Council (NAREDCO) [1998]:
→ It is a real estate organization and a self-regulatory body under the aegis of Min. of Housing and Urban
Affairs. NAREDCO is an apex body formed under MoHUA.

INFRASTRUCTURE
News:
 2020:
→ Union govt. fund infusion in NIIF as part of Aatmanirbhar Bharat Abhiyaan.
 2021:
→ Parliament passes Bill to set up National Bank for Financing Infrastructure and Development (NaBFID).
→ Infrastructure plan / scheme announced by GOI.
→ PM Gati Shakti launched.
→ Infrastructure Investment Trust (InvIT) of NHAI in news.
 2022:
→ PM Modi invites Nordic companies to invest in Blue Economy sector, including Sagarmala project and asked
sovereign wealth funds of Nordic countries to invest in India.
→ Ministry of Communications launches “GatiShakti Sanchar” portal.
→ GOI declares IT resources of ICICI Bank, HDFC Bank, UPI managing entity NPCI as ‘critical information infrastructure’.
This implies that any harm to them can have impact on national security and any unauthorised person accessing
these resources may be jailed for up to 10 years.
→ Union Education Secretary urges incorporating study of PM Gati Shakti scheme in academic programs.
→ Minister for Commerce and Industry Shri Piyush Goyal says PM GatiShakti National Master Plan has the potential to
save over Rs. 10 Lakh Crore annually by improving logistics efficiency.
→ The excitement around the recent bond offer from the National Highways Infra Trust (NHAI InvIT) [infrastructure
investment trust sponsored by National Highway Authority of India (NHAI)] has led to a lot of curiosity about InvITs.
GOI too is increasingly using the InvIT route to monetise assets held by government entities, and bring in broad-
based public shareholding.
About:
 Critical Infrastructure:
→ Critical infrastructure describes physical and cyber systems and assets that are so vital to country that
their incapacity or destruction would have huge impact on our physical or economic security or public
health or safety.
→ In 2022, GOI declared IT resources of ICICI Bank, HDFC Bank, UPI managing entity NPCI as ‘critical
information infrastructure’. This implies that any harm to them can have impact on national security and
any unauthorised person accessing these resources may be jailed for up to 10 years.
 Industrial Corridor:
→ What:
 corridor consisting of multi-modal transport services passing through many States.
 Industrial corridors offer effective integration between industry and infrastructure, leading to overall economic
and social development.
 Infrastructures allocated to specific geographical area, with intent to stimulate industrial development.
→ Infrastructure:

Page 553 of 719

  High-speed transportation network – rail, road.
 State-of-art ports.
 Modern airports international / national.
 Special economic regions/industrial areas.
 Logistic parks/transhipment hubs.
 Industrial knowledge parks.
 Townships/real estate.
→ Significance:
 Enhanced connectivity of industrial hubs with hinterland and ports will particularly help increase the
participation of Indian manufacturing in global production networks and global value chains, thereby creating
jobs along the corridor.
→ Industrial corridors of India:
 Delhi Mumbai Industrial Corridor (DMIC)
 Bengaluru Mumbai Industrial Corridor (BMIC)
 Chennai Bengaluru Industrial Corridor (CBIC)
 East Coast Economic Corridor (ECEC)
 Amritsar Kolkata Industrial Corridor (AKIC)
 ……
 Note: Aforementioned industrial corridor projects will be implemented via National Industrial Corridor
Development and Implementation Trust (NICDIT), 2016, under Min. of Commerce & Industry.
 Status of projects in India:
→ Many times, projects have faced overruns, leading to significant cost escalations.
→ Absence of coordination and collaboration among agencies has been major challenge to time bound
infrastructure project implementation in India.
→ As per Ministry of Statistics and Programme Implementation (MoSPI), about 1,500 Union Government
projects under implementation (valued at about Rs. 20 lakh crores) had run into cost overrun, largely
because of their delays.
→ Reason for delays:
 underestimation of original project cost
 spiralling land acquisition cost
 delays in environment, forest and wildlife clearances
 industrial licensing permission
 road crossing of pipelines / transmission lines
 shifting of utilities
 delays in tie-up of project financing
 delays in finalisation of detailed engineering, etc.
 bottlenecks at State Government level - land acquisition, removal of encroachments, relief and rehabilitation
planning and implementation, non-timely issuance of no objection certificate, necessary power and water
supply, work order related issues.
 Digital infrastructure:
→ Initiative:
 Digital India mission [2015], Provident Fund, Passports, Driving Licenses, Crossing tolls, checking land records etc
all have been transformed with modular applications built on Aadhaar, UPI, and India Stack.
→ Limitations of public digital infrastructure:
 Low availability and affordability: It is well established that digital infrastructure should be designed based on
principles of availability, affordability, value, and trust.
 Current digital ecosystem is not interconnected as design and technical integration is required to make them
conversant and interoperable.
 Validation of data is becoming complex: Information has to travel across multiple systems to complete
interaction and rely on private databases, which makes validation of data more complex as network grows,
driving up costs and creating inefficiencies.
→ Solutions:
 Web 3.0.
→ Way Forward:
 Auto verification using Blockchain: Blockchain -based infrastructure can provide attributes without
need of trusting any particular actor to verify ledger’s history. Blockchain records could be visible,
compiled, and audited by regulators in real-time.
 Gati Shakti / PM Gati Shakti / National Infrastructure Master Plan / National Master Plan [2020]:
→ What:
 National Master Plan for infrastructure development / National Master Plan for Multi-modal Connectivity /
National Master Plan for infrastructure development.
Page 554 of 719
  digital platform that connects many ministries for integrated planning and coordinated implementation of
infrastructure connectivity projects. Example of ministries are Roads and Highways, Railways, Shipping,
Petroleum and Gas, Power, Telecom, Aviation, ….
 It will lay foundation of holistic Infrastructure and will provide multimodal connectivity infrastr ucture
to various economic zones.
 This plan will coordinate planning and execution of infrastructure projects to bring down logistics
costs.
→ Aim:
 boost multimodal connectivity
 reduce logistics costs.
 ensure holistic planning and execution of infrastructure projects.
→ 6 Pillars of PM Gati Shakti:
 PM Gati Shakti is based on 6 pillars:
• Comprehensiveness: It will include all existing and planned initiatives of various Ministries and Departments
with one centralized portal. Each and every Department will now have visibility of each other's activities
providing critical data while planning & execution of projects in comprehensive manner.
• Prioritization: Through this, different Departments will be able to prioritize their projects through cross-
sectoral interactions.
• Optimization: National Master Plan will assist different ministries in planning for projects after identification
of critical gaps. For transportation of goods from one place to another, plan will help in selecting most
optimum route in terms of time and cost.
• Synchronization: Individual Ministries and Departments often work in silos. There is lack of coordination in
planning and implementation of project resulting in delays. PM Gati Shakti will help in synchronizing
activities of each department, as well as of different layers of governance, in holistic manner by ensuring
coordination of work between them.
• Analytical: Plan will provide entire data at one place with GIS based spatial planning and analytical tools
having 200+ layers, enabling better visibility to executing agency.
• Dynamic: All Ministries and Departments will now be able to visualize, review and monitor progress of cross-
sectoral projects, through GIS platform, as satellite imagery will give on-ground progress periodically and
progress of projects will be updated on regular basis on portal. It will help in identifying vital interventions
for enhancing and updating master plan.
→ Feature:
 Integrated planning: Gati will ensure integrated planning and implementation of infrastructure
projects in next 4 years, with focus on expediting works on ground, saving costs and creating jobs.
 Subsuming NIP: Gati Shakti scheme will subsume National Infrastructure Pipeline (NIP) [2019].
 Creation of corridors: Gati aims to have 11 industrial corridors and 2 new defence corridors.
 Connectivity: Under Gati, 4G connectivity will be extended to all villages. Addition of 17,000 km of gas
pipeline network.
 Integrated approach: Gati intends to bring together 16 infrastructure -related Ministries.
 Gati Shakti Digital Platform: This Gati digital platform involves creation of one common umbrella
platform through which infrastructure projects can be planned and implemented in efficacious manner
by way of coordination between various ministries / departments on real-time basis.
 Gati Shakti involves geospatial mapping of everything in India, different layers of maps which talk to
each other, leading to integrated planning, with better optimization of time and cost.
 Increase in shipping cargo capacity at ports
 Increase in cargo movement on all National Waterways
 Increase in cargo movement on Ganga R.
 It will cover infrastructure projects, of many Ministries of Union and State Governments, like
Bharatmala, Sagarmala, inland waterways, dry / land ports , UDAN (Ude Desh ka Aam Nagarik), …
 …
→ Need:
 Poor infrastructure planning: Example, newly-built roads being dug up by water department to lay pipes. This
has badly affected road infrastructure and movement in India.
 Logistics costs: Logistics costs in India are about 13-14% of GDP (as against about 7-8% of GDP in developed
economies). High logistics costs impact cost structures within economy, and also make it more expensive for
exporters to ship merchandise to buyers.
→ Services:
 PM Gati Shakti portal will offer: geospatial data about existing infrastructure - roads, highways,
railways, toll plazas; and geographic information about forests, rivers, district boundaries - to aid in
planning and obtaining clearances.

Page 555 of 719

  PM Gati Shakti portal will also allow various government departments to track, in real time, progress
of various projects, especially those with multi -sectoral and multi-regional impact.
→ Significance:
 Gati Shakti involves geospatial mapping of everything in India, different layers of maps which t alk to
each other, leading to integrated planning, with better optimization of time and cost.
 each and every department will now have visibility of each other’s activities, providing critical data
while planning and execution of projects in comprehensive m anner
 different govt. departments will be able to prioritise their projects through cross –sectoral interactions
 boost last-mile connectivity
 bringing down logistics costs with integrated planning and reducing implementation overlaps
 new employment opportunities for youths.
 raise global profile of local manufacturers
 make local manufacturers compete with their counterparts worldwide.
 possibilities of future economic zones.
 Gati Shakti is expected to revolutionise planning of infrastructure and logistic development projects
and implementation in India.
 Gati Shakti will bridge huge differences between macro planning and micro implementation.
 Step towards achieving India’s USD 5 trillion Economy goal.
→ Gatishakti Sanchar Portal [2022] (Its detail in Prelims note).
 National Infrastructure Pipeline (NIP):
→ What:
 provide world-class infrastructure, improve quality of life of citizens, attract investments.
 crucial for attaining $5 trillion economy by FY 2025.
 Economic and social infrastructure projects.
 Infrastructure Investment Trust (Invit):
→ What:
 InvITs are investment instruments that work like mutual funds and are regulated by SEBI. Typically, such vehicle
is designed to pool money (small sums) from several investors to be invested in income-generating assets.
 InvIT model is Collective Investment Scheme which enables direct investment of money from individual,
institutional investors in infrastructure projects to earn returns. similar to mutual fund. regulated by SEBI.
 institutions similar to mutual funds
 it pools investment from many investors and invest them into completed and revenue-generating infrastructure
projects, thereby creating returns for investor.
 Infrastructure Investment Trust model
 Collective Investment Scheme which enables direct investment of money from individual, institutional
investors in infrastructure projects to earn returns.
 InvIT is in-between vehicle that has features of stocks, bonds and mutual funds. It is a pooled investment vehicle
like a mutual fund but applicable to the Infrastructure sector. While mutual funds invest the sum received in
financial securities, an InvIT invests the same in real infrastructure assets like roads, power plants, transmission
lines, pipelines etc. They are regulated under SEBI (Infrastructure Investment Trusts) Regulations, 2014 and
Indian Trusts Act, 1882.
→ Regulation:
 regulated by SEBI via SEBI (Infrastructure Investment Trusts) Regulations, 2014
 Indian Trusts Act, 1882.
→ Structure:
 Trustee: It inspects performance of InvIT.
 Sponsor: Promoters of company that set up InvIT.
 Investment Manager: It supervises assets and investments of InvIT.
 Project Manager: It executes project.
→ Working mechanism:
 InvITs list on the stock market / stock exchange to raise money to acquire a portfolio of infrastructure assets
that are already running and generating regular cash flows.
→ Benefits to investors:
 InvITs enable investors to buy small portion of units being sold.
 Because of completed and operational projects with positive cash flow, risks are low.
 favourable tax norms (exemption on dividend income, less capital gains tax).
 InvITs are an in-between vehicle that have features of stocks, bonds and mutual funds.
 Investors in an InvIT become part owners of its operating assets such as toll roads or power transmission lines,
while in a stock IPO, they get to part-own the underlying business.
→ Status:

Page 556 of 719

  GOI is increasingly using the InvIT route to monetise assets held by government entities, and bring in broad-
based public shareholding.
→ Way Forward:
 In 2021, in relation to National Monetisation Pipeline (NMP) [2021], NITI AYOG recommended that
InviTs should be included under Insolvency and Bankruptcy Code (IBC), 2016:
• Bring such instruments (InvITs) under IBC 2016 to provide greater comfort to investors. IBC provision of
recourse will bring in comfort to investors. And, it would help lenders access faster and effective debt
restructuring and resolution option.
• [Presently, InvITs are not considered ‘legal persons’ in India, hence IBC regulations are not applicable for
InvIT loans. Hence, lenders do not have existing process for recourse to project assets. This reduces
investment from potential investors. Though, investments are protected under SARFAESI Act, 2002,
Recovery of Debts and Bankruptcy Act, 1993].
 National Investment and Infrastructure Fund (NIIF) [2015]:
→ What:
 India’s 1st infrastructure specific investment fund or sovereign wealth fund
 investment fund for funding commercially viable: greenfield project, brownfield project, stalled infrastructure
project.
→ Objective:
 maximize economic impact mainly through infrastructure investment in commercially viable projects, both
greenfield and brownfield.
→ Investment mandate:
 Energy, Transportation, Housing, Water, waste management, infrastructure-related sectors.
→ NIIF Funds:
 Registered as Alternate Investment Fund (AIF) with SEBI.
 Types:
• Master Fund:
 infrastructure fund
 for investing in core infrastructure sectors - roads, ports, airports, power etc.
• Fund of Funds:
 Managed by fund managers
 focus on: Green Infrastructure, Housing, Infrastructure services
• Strategic Investment Fund:
 registered as Alternative Investment Fund (AIF) Category II under SEBI
 for investing in equity markets etc.
→ NIIF Investors:
 Abu Dhabi Investment Authority (ADIA) -> 1st ever international investor in NIIF Master Fund.
 Government of India holds 49% share in NIIF.
 Domestic investors: ICICI Bank, HDFC Bank, Axis Bank etc.
 Asian Infrastructure Investment Bank (AIIB).
 Initiative:
→ Sagarmala Programme / Sagarmala project / Sagar Mala [2015] [for port led development.].
 Way Forward:
→ Gati Shakti is viewed as solution because it is expected to revolutionise planning of infrastructure and
logistic development projects and implementation in India.
→ Gati Shakti will bridge huge differences between macro planning and micro implementation.
Note:
 National Industrial Corridor Development Programme (NICDP):
→ What:
 NICDP is India's most ambitious infrastructure programme aiming to develop futuristic industrial cities in India /
new industrial cities as "Smart Cities" and converging next generation technologies across infrastructure sectors
which can compete with best manufacturing and investment destinations in world. Same will create
employment opportunities and economic growth leading to overall socio-economic development.
 NICDP is under vision of PM Gati Shakti. National Industrial Corridor Development Corporation (NICDC) is one
special purpose vehicle (SPV) under Department for Promotion of Industry and Internal Trade (DPIIT) (Ministry
of Commerce and Industry).
→ Feature:
 GOI is developing various industrial corridor projects as part of NICDP.
 While developing Delhi Mumbai Industrial Corridor (DMIC) project, Western Dedicated Freight Corridor has been
considered as transportation backbone while Eastern Dedicated Freight Corridor has been considered as
backbone for Amritsar Kolkata Industrial Corridor (AKIC) project. For other industrial corridor projects like
Chennai Bengaluru Industrial Corridor (CBIC) and Bengaluru Mumbai Industrial Corridor (BMIC), NH-4 has been

Page 557 of 719

 considered as backbone. For East Coast Economic Corridor (ECEC), NH-5 which is part of Golden Quadrilateral,
Kolkata–Chennai rail route has been considered as transport backbone. Proposed North-South East-West and
East Coast Dedicated Freight Corridors will further supplement existing transportation backbone for
corresponding industrial corridors.
 National Bank for Financing Infrastructure and Development (NaBFID):
→ What:
 one Development Finance Institution (DFI)
 national bank for funding infrastructure and development activity.
 with corpus of ₹20,000 crore.
 wholly owned by Government, initially but would be lowered to 25%.
 Eminent person - chairperson.
→ Need:
 for funding ambitious NIP.
 enhance credit rating of projects.
 funding of projects where others are not willing to enter because of risks involved.
Value Addition:
 Infrastructure (industrial, transportation):
→ International airports
→ Major Ports
→ Dedicated Freight Corridors
→ National Investment & Manufacturing Zones (NIMZ):
 started in 2019
 Zone / policy that focuses on industrial growth through collaboration with local State governments.
 NIMZ policy focuses on industrial corridors.
→ Industrial Corridors.
 Real Estate Investment Trust (REIT):
→ What:
 ReIT is one company that owns and typically operates income -producing real estate or related assets.
These may include office buildings, shopping malls, apartments, hotels, resorts, self -storage facilities,
warehouses, and mortgages or loans.
→ Cycle:
 Investors -> REITs (capital used to buy and manage) -> real estate (growth and rental income) -> Profits
-> Investors (dividends).
 REIT vs InvIT:
→
{REIT} {InvIT}
It is like mutual fund that invests in real estate. It is like mutual fund, which enables direct
investment of small amounts of money from
possible individual / institutional investors in
infrastructure to earn small portion of income as
return.
you own share of property, and so appropriate InvITs can be treated as modified version of
share of income from it will come to you, after REITs designed to suit specific circumstances of
deducting appropriate share of expenses. infrastructure sector.
It’s like group of people pooling their money similar to REIT but invest in infrastructure projects
together and buying real estate except that it’s on – roads, highways - which take some time to
large scale and is regulated. generate steady cash flows.
Mains Link:
 Discuss the need for and significance of Industrial corridors.
 Discuss about the significance of Gati Shakti project.
 Discuss the significance and features of NIP.
 Discuss the significance of NIIF in the context infrastructure development in India.
 Discuss the significance of the Sagarmala Project.

SUGAR
News:
 2022:
→ Government notifies that sugar exports will be restricted, or allowed only with permission, until further orders.
 Changes:
• Restricted Category: Sugar has moved from ‘open category’, which requires no government intervention,
to ‘restricted’ category.

Page 558 of 719

 • Specific permission: Export of sugar is allowed only with specific permission from Directorate of Sugar,
Department of Food and Public Distribution (DFPD), Ministry of Consumer Affairs, Food & Public
Distribution.
• Re-exports of refined sugar, made from raw sugar imported under Advance Authorisation Scheme, may not
require prior permission.
 Reason:
• To maintain domestic availability and price stability of sugar.
• Exports, if allowed, can lead to supply constraints for some months in next season. If there is scarcity of
back-up stocks during this period then prices can escalate in domestic market.
• To Curb inflation: India’s retail inflation has been above RBI’s tolerance band for some month, and is likely
to continue in coming months too.
 Impact:
• Curbs on exports may further flame global food prices.
• Export restrictions will make more surplus sweetener (sugar) accessible for domestic ethanol production,
which is primary government aim as per National Biofuel Policy.
→ In 2021-22, Maharashtra overtook UP to regain its position as India’s top sugar producer.
→ Centre raises fair prices / Fair and Remunerative Price (FRP) for sugarcane harvest.
→ India emerges world's 2nd largest exporter of sugar: India has emerged as world's largest producer and consumer of
sugar as well as world's 2nd largest exporter of sugar. In Sugar Season 2021-22 (Oct-Sep), record of more than 5000
Lakh Metric Tons (LMT) sugarcane was produced in India out of which about 3574 LMT of sugarcane was crushed by
sugar mills to produce about 394 LMT of sugar (Sucrose). Out of this, 35 LMT sugar was diverted to ethanol
production and 359 LMT sugar was produced by sugar mills. Ministry of Consumer Affairs, Food & Public Distribution
says Sugar season 2021-22 is one watershed season for Indian Sugar Sector, during which India recorded highest
sugar exports of over 109 LMT.
 Reasons behind high sugar production:
• High international prices of sugar.
• Supportive Central and State government policies: Diversion of sugar to ethanol and exports led to unlocking
of value chain of whole sugar industry as well as improved financial conditions of sugar mills leading to more
optional mills.
→ Sugarcane production in India shifting from South to North: According to 2022 National Statistical Office
(NSO) report, 6 sugarcane-producing northern Indian States see a 42% increase in their output value
between 2011 and 2020 while that of 5 States from the south declined 32.4% during the same period.
About:
 Sugarcane:
→ Temperature: Between 21-27°C with hot and humid climate.
→ Rainfall: Around 75-100 cm.
→ Soil Type: Deep rich loamy soil.
→ Top sugarcane producing States: UP > MH > Karnataka > TN > Bihar.
→ India is 2nd largest producer of sugarcane, after Brazil.
 Sugar exporter:
→ Brazil, Thailand, India are world’s top sugar exporters.
 India’s sugar Industry:
→ Raw material – Sugarcane.
→ In 2021, Sugar mills surpassed their export target. It made easier for them to pay sugarcane farmers and reducing
arrears.
→ Government is encouraging diversion of excess sugar towards ethanol production, exporting.
→ In last few years, sugar export increased.
→ Growth in sugar export is due to: demand for Indian sugar in global market; and assistance of centre to increase sugar
exports.
→ Areas:
 India’s sugar industry is broadly divided into 2 major areas of production:
• Uttar Pradesh, Bihar, Haryana, Punjab in north; and
• Maharashtra, Karnataka, Tamil Nadu, Andhra Pradesh in south. Due to tropical climate in South India, it has
higher sucrose content giving higher yield per unit area as compared to north India.
→ Sugar Pricing Policy:
 under concurrent list 7th schedule.
 Price of sugar are market driven & depends on demand & supply of sugar. However, in 2018, concept
of Minimum Selling Price of sugar was introduced to protect interests of farmers. Thus, sugar industry can get
atleast minimum cost of production of sugar, so as to enable sugar industry to pay cane prices to farmers.
 Under Essential Commodities Act, 1955, government notified Sugar Price (Control) Order, 2018:
• Government fixes MSP of sugar.
Page 559 of 719
 • While fixing MSP of sugar, govt. considers FRP of sugarcane, minimum conversion cost of mills.
 States:
• State Advised Prices (SAP) are announced by key sugarcane producing States. And, SAPs are generally higher
than FRP.
→ Concern:
 Despite this impressive growth, arrears are major issue for sugarcane farmers in India.
 Low yield compared to other parts of world. low sugar recovery rate. high production cost. low and delayed
remuneration for farmers.
→ Initiative:
 In order to regulate sugar industry, C. Rangarajan Committee (2012) recommended several reforms such as
abolition of quantitative controls on export and import of sugar.
→ Significance:
 Labour-intensive sector. Has multiple by-products. Important for biofuel.
 India:
→ Status:
 In 2022, India emerged as world's 2nd largest exporter of sugar.
 India is world's largest producer and consumer of sugar.
 In Sugar Season 2021-22 (Oct-Sep), record of more than 5000 Lakh Metric Tons (LMT) sugarcane was produced
in India out of which about 3574 LMT of sugarcane was crushed by sugar mills to produce about 394 LMT of
sugar (Sucrose). Out of this, 35 LMT sugar was diverted to ethanol production and 359 LMT sugar was produced
by sugar mills.
 According to 2022 National Statistical Office (NSO) report, 6 sugarcane-producing northern Indian
States see a 42% increase in their output value between 2011 and 2020 while that of 5 States from the
south declined 32.4% during the same period.
This northward shift in sugarcane production is on account of larger irrigated area in the region
and higher State Advisory Price (SAP) over and above the Centre’s Fair and Remunerative Price (FRP)
being offered in the north, especially by Uttar Pradesh.
Northern States like Uttar Pradesh have been consistently offering higher SAP for sugarcane over the
past decade. Southern States, including Karnataka and Tamil Nadu, have moved away from SAP and adopted
the revenue sharing model. But they are not able to realise a remunerative price as the mills have been reporting
precarious financial situations. Moreover, southern States are diverting their water to other high value crops.
Although Maharashtra is the leading sugar producer in India, Uttar Pradesh has the highest sugarcane
output value in India.
Uttar Pradesh alone accounts for around 83% of the output value among the 6 northern States and its
output value grew 43.9% from Rs. 24,860 crore to Rs. 35,770 crore over the decade, as the sucrose levels in the
sugarcane produced in UP continue to increase.
Barring Karnataka, which saw a marginal increase of 0.9% in the output value, other sugarcane-
producing southern States like Telangana and Maharashtra also saw their output value decline by nearly 50%
and 27%, respectively.
Data sourced from RBI shows total sugarcane production in the 5 southern States has come down from
181.35 million tonnes (mt) to 130.65 mt during the 2011-2020 period while the production in the 6 northern
States has increased from 161.7 mt to 222.51 mt.
→ Fact:
 Sugarcane is raw material of sugar industry.
 India is 2nd largest exporter of sugar after Brazil.
 In 2021, Sugar mills surpassed their export target. It made easier for them to pay sugarcane farmers and reducing
arrears.
 Government is encouraging diversion of excess sugar towards ethanol production, exporting.
 In last few years, sugar export increased.
 Growth in sugar export is due to:
• demand for Indian sugar in global market
• assistance of centre to increase sugar exports.
→ Sugar Producing States [india]:
 Maharashtra - 1st
 Uttar Pradesh – 2nd
 Karanataka
 …
→ Concern:
 Despite this impressive growth, arrears are major issue for sugarcane farmers in India.
Note:
 Fair and Remunerative Price (FRP):

Page 560 of 719

 → What:
 minimum price [Statutory Minimum Price (SMP)] at which sugarcane is to be purchased by sugar mills from
sugarcane farmers. FRP is basically MSP for sugarcane. Other crops have MSP but for sugarcane, govt. came up
with FRP. FRP is fixed by govt. but paid by sugar mills to sugarcane farmers. Reason is, because of weight-losing
property of sugarcane, sugarcane must reach sugar mills within stipulated time period. So, govt. procurement
via MSP would not be viable solution in case of sugarcane. Hence, MSP was replaced by FRP in case of sugarcane.
FRP is price declared by government, which mills are legally bound to pay to farmers for cane procured from
them.
 However, States determine their own State Advisory Price (SAP) which is generally higher than the Centre’s FRP.
→ Feature:
 Central government (CCEA, chaired by PM) announces FRP, determined on recommendation of CACP.
 FRP is based on recovery of sugar from sugarcane. Sugar recovery is ratio between sugar produced versus cane
crushed, expressed as %. Higher sugar recovery, higher is FRP, and higher is sugar produced.
 FRP is based on 2012 Rangarajan Committee report on sugarcane industry.
 payment of FRP across India is governed by Sugarcane Control order, 1966, issued under Essential Commodities
Act, 1955, which mandates payment within 14 days of date of delivery of cane.
 FRP is fixed by central govt. but paid by sugar mills to sugarcane farmers.
 Delays in payment (mills to farmers) can attract interest up to 15% per annum, and sugar commissioner can
recover unpaid FRP as dues in revenue recovery by attaching properties of mills.
→ Significance:
 Assured payment is one of major reasons why cane is popular crop with farmers.
 Delays in payment can attract interest up to 15% per annum, and sugar commissioner can recover unpaid FRP
as dues in revenue recovery by attaching properties of sugar mills.
Value Addition:
 Agriculture Infrastructure Development Cess:
→ This cess will be used for specified purpose i.e. to improve agricultural infrastructure in India:
 by enhancing production
 by protecting agriculture sector from undue competition
 by enhancing agricultural output competently.

RICE / PADDY
News:
 2022:
→ Centre says it will stop purchase of excess parboiled rice. [Demand for parboiled rice has come down in
recent years].
→ Punjab government announces incentive (rupees) for farmers opting for Direct Seeding of Rice (DSR).
→ While overall crop coverage has risen since 2021, that of rice is down. Deficient rainfall in UP, Bihar; and
drying up of nurseries are among reasons. SW monsoon’s revival has resulted in total area sown under
kharif crops not only recovering, but even surpassing 2021’s coverage, however, paddy (rice) acreage is
down from 2021’s. That is, India has witnessed shortfall in rice acreage while overall crop coverage has
risen.
→ Despite incentives, why is DSR technique not gaining ground in Punjab? Punjab government had announced
Rs 1,500 per acre incentive to farmers for adopting DSR method. But they are returning to traditional
method of puddled transplanting of rice in majority of paddy area.
→ GOI has been supplying fortified rice for 1 year now. [GOI in 2021 announced Fortified Rice would be used
in every scheme of Government throughout India by 2024 in phased manner].
→ Improving rice yield with additional gene: Adding 2 nd copy of one of its own genes boosted yield of one
Chinese rice variety by up to 40%. It boosted grain yields and shortened growth duration of rice.
 Study: When 2 nd copy of one single gene (called OsDREB1C) is added to rice, it improved
photosynthesis and nitrogen use, speed up flowering and absorbed nitrogen more efficiently —
offering larger and more abundant grains. It was done using Gene Modulation (process of temporarily
altering gene expression levels without making heritable changes to underlying ce llular DNA).
 Benefit for India in adopting this practice of Rice gene modulation:
• It added same gene again, and not any foreign one. It is genetic modulation and not genetic modification
(GM) or transgenic plant i.e. carrying elements from another donor and thus it reduces risk related to GM
or transgenic crops. For example, BT cotton involves transfer of gene from bacterium called Bacillus
thurigiensis (BT) to be transferred to normal cotton.
• No regulation on Gene Modification: India has exempted crops with certain kinds of genetic modifications
from regulations previously imposed on commercialisation of all genetically modified crops.
• It will reduce -ve impact of ‘Green Revolution’.

Page 561 of 719

 → India bans broken rice export: India, world’s largest exporter of rice, bans exports of broken rice, amid 6%
reduction in paddy acreage in ongoing Kharif season and increase in rice prices. India also imposes 20%
duty on exports of various grades of rice [such as rice in husk ( paddy or rough), husked (brown rice), semi-
milled or wholly-milled rice), except basmati. [Weak monsoon has led to reduction in paddy acreage this
Kharif season].
 Reason for ban:
• There has been lower rice production this year in 2022 due to deficient rainfall in some areas. High food
inflation. For use in Ethanol blending: In Ethanol Supply Year (ESY) 2018-19, GOI allowed FCI to sell surplus
rice to ethanol plants for fuel production. Broken rice was also used as Poultry feed.
→ With winter approaching and instances of stubble burning in Punjab and Haryana rising, Environment Ministry
announces a Rs. 50 crore scheme to incentivise industrialists and entrepreneurs to set up paddy straw pelletisation
and torrefaction plants. MoEFCC releases CPCB Guidelines for grant of one-time financial support for promoting
establishment of paddy straw based pelletisation and torrefaction plants. These plants, once set up, would utilise a
sizeable portion of the unmanaged paddy straw and help address the issue of crop residue burning and the resultant
air pollution.
 Need:
• Every year, over 27 million tonnes of paddy straw is generated in Punjab and Haryana, many of which are
usually burnt which adds to air pollution.
 Benefit:
• Paddy straw made into pellets or torrefied can be mixed along with coal in thermal power plants. This saves
coal as well as reduces carbon emissions. It will reduce straw burning and improve AQI in NCR, Punjab,
Haryana. Employment generation. Energy security.
→ 5 new varieties of seeds of Basmati rice, developed by Indian Agricultural Research Institute (IARI) in 2020 and 2021,
are all set to bring revolutionary changes in the way Basmati rice is cultivated in India. IARI developed these 5 seeds
in 2020 and 2021, which are now ready to be used in fields after all trials; these paddy seeds can resist diseases and
herbicides. 3 of the 5 varieties can resist 2 common diseases of paddy (one bacterial and one fungal). The other 2
varieties can save 35% of water as the method of Direct Seeding of Rice (DSR) can be used to raise them. These 2
seeds are resistant to herbicides too, helping the farmers control weeds more efficiently.
About:
 Broken rice:
→ It is fragments of rice grains, broken in field, during drying, during transport, or during milling. Mechanical
separators are used to separate broken grains from whole grains and sort them by size. Broken rice is
fragmented, not defective; so there is nothing wrong with it. It is as nutritious as equivalent quantity of
unbroken rice (i.e. if all germ and bran remains, it is as nutritious as brown rice; if none remains, it is only
as nutritious as white rice). Broken rice has long history - Ibn Baṭṭuṭa mentions rice grains in area of Mali
in 1350, presumably made of African rice.
 Basmati:
→ What:
 It is a variety of long, slender-grained aromatic rice which is traditionally grown in India, Pakistan, and
Nepal. As of 2019, India accounted for 65% of the international trade in basmati rice, while Pakistan
accounted for the remaining 35%. Many countries use domestically grown basmati rice crops;
however, basmati is geographically exclusive to certain districts of India and Pakistan .
→ Feature:
 Criteria:
• According to APEDA (Indian Government agency), a rice variety is eligible to be called basmati if it
has a minimum average precooked milled rice length of 6.61 mm and average precooked milled
rice breadth of up to 2 mm, among other parameters.
 Basmati is known for its mouthfeel, aroma, and length of the grain when cooked and tasted.
→ Basmati rice production in India:
 India is known for its Basmati rice, with 7 States — Jammu and Kashmir, Himachal Pradesh, Punjab,
Haryana, Delhi, Uttar Pradesh and Uttarakhand — earmarked for geographical indication (GI).
 Basmati has a market abroad and brings about Rs. 30,000 crores in foreign exchange every year.
 While 75% of the export is to West Asian countries, EU countries also import Indian Basmati. However,
recently, the export to EU countries faced certain hurdles due to the increase in the pesticide residue
levels in the rice from India.
 Feature:
→ Temperature: 22-32 degree C (high humidity)
→ Rainfall: around 150 – 300 cm.
→ Soil: Deep clayey and loamy soil.
 Paddy cultivation:
→ Conditions required:

Page 562 of 719

  Temperature: 22-32 degree C (high humidity); Rainfall: around 150 -300 cm; Soil type: Deep clayey,
loamy soil.
→ Process:
 Farmers 1 st sow paddy seeds in nurseries. These seedlings are then uprooted and replanted 25-35 days
later in main field. Nursery sowing generally happens before monsoon rains. For 1 st 3 weeks or so after
transplanting, water depth has to be maintained at 4 -5 cm, in order to control weed growth in early
stage of paddy crop.
→ Methods of Rice cultivation:
 Transplantation: Seeds are 1 st shown in nursery and seedlings are transplanted to main field.
 Drilling Method: Seeds are put in soil which has been drilled.
 System of Rice intensification: It is farming methodology aimed at increasing yield of rice produced in
farming. It is low-water, labour-intensive method that uses younger seedlings singly spaced and
typically hand weeded with special tools. It is also called Madagascar method of rice cultivation as it
was 1 st developed there. It promises to save 15 to 20% of ground water, and improve rice productivity,
which is almost at stagnant point now. Experts said that it gives equal to or more productive than
conventional rice cultivation, with less water, less seed and less chemicals. Net effect is substantial
reduction in investments in external inputs. SRI is suitable in all types of soil including less fertile soil
as in such soil number of seedlings can be increased to double.
 Direct Seeding of Rice (DSR):
→ What:
 In DSR, pre-germinated seeds are directly drilled into field by tractor -powered machine. There is no
nursery preparation or transplantation involved in this method. Farmers have to only level their land
and give one pre-sowing irrigation. Direct seeding or direct sowing just means that we start planting seeds
in garden, rather than buying small plants or starting seeds indoors earlier and transplanting them outside. It is
water-saving method of sowing paddy. Seeds are directly drilled into fields in this method. This saves
groundwater, as opposed to traditional water-intensive method, under which rice seedlings are transplanted
from nursery to waterlogged fields. DSR aims to sow short-duration and high-yield varieties. DSR is done through
DSR machines which are used for planting seeds of rice directly into fields.
→ DSR vs conventional methods:
 In transplanting paddy, farmers prepare nurseries where paddy seeds are 1st sown and raised into young plants.
Nursery seed bed is 5-10% of area to be transplanted. Seedlings are then uprooted and replanted 25-35 days
later in wet field covered with water.
→ Advantage:
 Water savings: 1st irrigation (apart from pre-sowing) under DSR is necessary only 21 days after sowing. This is
unlike in transplanted paddy, where watering has to be done practically daily to ensure submerged / flooded
conditions in 1st three weeks. Less Labour required. Reduced CH4 emissions due to shorter flooding period and
decreased soil disturbance compared to transplanting rice seedlings. Easier and faster showing. Water use
efficiency. Labor use efficiency. Suitable for crop intensification. More profitable. Maintain better soil physical
properties. Decreases GHG emissions. Higher or comparable grain yield.
→ Limitations:
 Non-availability of herbicides. Seed requirement for DSR is also higher. Laser land levelling is compulsory in DSR.
This is not so in transplanting. Sowing needs to be done timely so that plants have come out properly before
monsoon rains arrive.
→ Punjab:
 Case: In 2022, Punjab government announced incentive (Rs 1,500 per acre) to farmers for adopting
DSR method. Reason: To save groundwater - 15% to 20% of groundwater could be saved by adopting
DSR. However, despite these incentives, DSR technique is not gaining ground in Punjab. Farmers are
returning to traditional method of puddled transplanting of rice in majority of paddy areas.
 Reasons for decline in DSR:
• Lack of power and adequate water: There were erratic power cuts. Also, canal water was not available in
adequate amount during sowing time of DSR.
• Varied results: Results of DSR depend on farmer to farmer and soil types. Some farmers are getting more
yield from this method, while some are getting less.
• Light soils are bad and heavy soils are good for DSR.
• Lack of technical know-how: Majority of farmers in Punjab are still not much well-versed in technique and
after facing huge losses in wheat yield in 2022, they prefer assured traditional method, instead of
experimental DSR.
• Need for weedicide: Though DSR does not need labour, it needs several sprays of weedicides to control
weeds. In traditional agriculture, flood irrigation acts as weedicide.
• Low incentive: Many farmers complain that losses due to adoption of DSR are over Rs. 6000 per acre, but
incentive with DSR sowing is just Rs 1,500 per acre.

Page 563 of 719

  What should be done?
• Experts say DSR won’t help much in saving Punjab’s water: While traditional methods take around 5,000
litres to grow 1 kg of rice, with 15% to 20% water saving DSR will take around 4,000 to 4,200 litres which is
also huge.
• Haryana Model to save water: Punjab Government should adopt Haryana government model to save
groundwater wherein Haryana government under its scheme “Mera Pani Meri Virasat” is offering Rs 7,000
per acre (along with insurance cover) to farmers who will avoid paddy crop and adopt other alternative
crops like fruit, vegetables.
 Top rice producing countries:
→ China, India, Indonesia, Bangladesh, …. That is, Top 10 producing rice countries are mostly in South Asia,
and SE Asia and Brazil.
 Top rice exporting countries:
→ India, Thailand, Pakistan, Vietnam, United States.
 Parboiled rice / converted rice / easy-cook rice:
→ What:
 rice partially boiled in husk. rice partially boiled at paddy stage, before milling. After passing through these
stages, paddy goes for milling. Parboiling of rice is not new practice, and has been followed in India since ancient
times.
→ Procedure:
 3 basic steps of parboiling are soaking, steaming, drying. These steps make rice easier to process by hand, while
also boosting its nutritional profile, changing its texture, and making it more resistant to weevils (insects). This
treatment is practiced in many parts of world.
→ Disadvantages:
 Rice becomes darker and may smell unpleasant due to prolonged soaking. Setting up parboiling rice milling unit
requires higher investment than raw rice milling unit.
→ Significance:
 Parboiling drives nutrients, especially thiamin, from bran to endosperm, and hence parboiled white rice is mostly
nutritionally similar to brown rice. Parboiling makes rice tougher. This reduces chances of rice kernel breaking
during milling. Parboiling also increases nutrient value of rice. Parboiled rice has higher resistance to insects,
fungi.
→ Producer [India]:
 Telangana, AP are major producers.
 India:
→ Paddy cultivation:
 Paddy cultivation takes place across wider geography, unlike wheat which is grown only in some States north of
Vindhyas. Also, rice is both Kharif (monsoon) and rabi (winter-spring) season crop. So, losses in one area or
season can potentially be recouped from other.
→ Status:
 Rice is one of chief grains of India. Rice is India’s largest agricultural crop (accounting for over 40% of total
foodgrain output). India has largest area in world under rice cultivation. India is world's 2nd-largest producer of
rice. India is among top 2 largest exporter of rice in world (around 40% of world’s export). India is world’s
largest exporter of rice (approx. 18.75 million metric tons exported to over 150 countries during year
2021-22).
→ Top rice producing States:
 WB, UP, Punjab, .. That is, rice is mostly grown in India in Punjab, Gangetic plains, Eastern India, Western ghats,
Eastern ghats.
→ Rice export:
 Basmati rice: India is leading exporter of Basmati Rice to global market. Indian States with highest areas of
Basmati rice under production are JK, HP, Punjab, Haryana, Delhi, Uttarakhand, UP. Basmati rice is major
ingredient in Biriyani, Ghee Rice in India.
 Non-Basmati rice: Any rice other than Basmati. India also exports Non-Basmati rice. Main export destinations
are Nepal, Benin, Senegal, Bangladesh, Guinea.
 In descending order, China, Senegal, Vietnam, Djibouti, Indonesia are biggest importers of India’s broken rice.
Hence, these countries would be impacted in of any export ban by India.
Note:
 Aus, Aman, Boro: These 3 paddy crops are grown in Assam, WB, Odisha in 1 single year.
 Rice Fortification:
→ What:
 increasing content of essential micronutrient – vitamins, minerals, trace elements - in rice. One example of Food
Fortification. Rice fortification is process of adding Fortified Rice Kernels (FRK) containing micronutrients such as

Page 564 of 719

 – Iron, Vitamin B12, Folic Acid - in ratio of 1:100 (i.e. 1 part micronutrients and 100 parts rice) at time of milling.
As per FSSAI norms, 1 kg fortified rice will contain iron, folic acid and Vitamin B-12.
→ Fortified rice contains:
 Vitamin A, Vitamin B1, Vitamin B2, Vitamin B3, Vitamin B6, Vitamin B12, Folic Acid, Iron, Zinc etc.
→ Need:
 Rice is world’s most important staple food. Regular milled rice is low in micronutrients. Regular milled rice
primarily contains carbohydrate. India has high levels of malnutrition, anaemia among women, children. India
ranks low on Global Hunger Index (GHI).
→ Benefits: Fortification of rice is cost-effective and complementary strategy to increase vitamin and mineral content
in diets. This will help in fighting high levels of malnutrition in India.
→ Issue: Evidence of benefits of fortification are inconclusive; it could lead to ‘hypervitaminosis’ (high level of vitamins);
dietary diversity is much better alternative to fortification.
→ Odisha Model:
 Iron-fortified rice blended with ordinary rice to boost midday meals.
→ Significance:
 According to Food Ministry, fortification of rice is cost-effective and complementary strategy to increase vitamin
and mineral content in diets.
Value Addition:
 No-till farming / Zero tillage / Direct drilling:
→ What:
 One agricultural technique for growing crops or pasture without disturbing soil through tillage. No-till farming
decreases amount of soil erosion tillage causes in certain soils, especially in sandy and dry soils on sloping terrain.
→ Feature:
 While conventional no-tillage systems use herbicides to control weeds, organic systems use combination of
strategies, such as planting cover crops as mulch to suppress weeds.
→ 3 Methods:
 Sod seeding: It is when crops are sown with seeding machinery into sod produced by applying herbicides on
cover crop (killing that vegetation). Direct seeding: it is when crops are sown through residue of previous crop.
Surface seeding: It is when crops are left on surface of soil; on flatlands, this requires no machinery and minimal
labor.
→ Benefit:
 This farming decreases amount of soil erosion tillage causes in certain soils, especially in sandy and dry soils on
sloping terrain; Increase in amount of water that infiltrates into soil; Soil retention of organic matter; Nutrient
cycling. It may increase amount and variety of life in and on soil.
→ Trend:
 Tillage is dominant in agriculture today, but no-till methods may have success in some contexts. In some cases
minimum tillage or "low-till" methods combine till and no-till methods. For example, some approaches may use
shallow cultivation (i.e. using disc harrow) but no plowing or use strip tillage.
Glossary:
 Pelletizing:
→ It is the process of compressing or molding a material into the shape of a pellet. A wide range of different materials
are pelletized including chemicals, iron ore, animal compound feed, plastics, waste materials, and more. The process
is considered an excellent option for the storage and transport of said materials. The technology is widely used in the
powder metallurgy engineering and medicine industries.
→ Pelletizing of rice is the process of compressing or molding rice straw into the shape of a pellet.
 Torrefaction:
→ Torrefaction of biomass, e.g., wood or grain, is a mild form of pyrolysis at temperatures typically between 200 and
320°C. Torrefaction changes biomass properties to provide a better fuel quality for combustion and gasification
applications. Torrefaction produces a relatively dry product, which reduces or eliminates its potential for organic
decomposition. Torrefaction combined with densification creates an energy-dense fuel carrier. Torrefaction makes
the material undergo Maillard reactions. Torrefied biomass can be used as an energy carrier or as a feedstock used
in the production of bio-based fuels and chemicals.
Biomass can be an important energy source. However, there exists a large diversity of potential biomass sources,
each with its own unique characteristics. To create efficient biomass-to-energy chains, torrefaction of biomass,
combined with densification (pelletisation or briquetting), is a promising step towards overcoming the logistical
challenges in developing large-scale sustainable energy solutions, by making it easier to transport and store. Pellets
or briquettes have higher density, contain less moisture, and are more stable in storage than the biomass they are
derived from.
Torrefaction is a thermal pre-treatment technology. It produces a solid biofuel product that has superior
handling, milling and co-firing capabilities compared to other biomass fuels. Torrefaction is costlier but it can deliver
a product whose energy content is much higher and can substitute for more coal in a power plant.
Question:
Page 565 of 719
  Sowing of wheat is possible without burning residue of previous crops e.g. using happy seeders. Without need for nursery
of rice saplings (transplantation), direct planting (DRS) of paddy seeds in wet soil is possible. Carbon sequestration in soil
is possible.
 Lower Gangetic plain is characterised by humid climate with high temperature throughout year, and thus pairs of crops
of Paddy and Jute is most suitable for this region.
 Among following crops, which one is most important anthropogenic source of both methane and nitrous oxide? – Cotton,
Rice, Sugarcane, Wheat.
→ Ans: Rice. Irrigated rice or paddy crop cultivation has been identified as one of leading global agricultural sources of
anthropogenic methane (CH4) emissions. It has been estimated that global rice production is responsible for 11% of
total anthropogenic CH4 emissions. Irrigated rice fields are major source of methane from rice fields. Although
irrigated rice comprises only 50% of harvested rice area, it produces 70% of rice harvested.
Mains Link:
 What is/are the advantage/advantages of zero tillage in agriculture? (UPSC 2020)

PETROL / DIESEL / OIL / PETROLEUM / CRUDE

News:
 2021:
→ Retail prices of automobile fuels reached record high across India in February 2021.
→ OPEC+ to not increase supply in awaiting for recovery in demand amid Covid-19 pandemic. Thus, crude prices rose.
→ India is working to persuade oil exporting countries to moderate increasing oil prices and warned that high prices
would push India to tap alternative import sources – from Iran etc.
 Impact on India:
• OPEC nations have traditionally been India’s principal oil source.
• OPEC and its allies (OPEC+) ignored India’s call for easing supply curbs, that had led to India tapping newer
sources to diversify India’s crude oil imports.
• As result, OPEC’s share in India’s oil imports has dropped to about half in early 2021.
→ OPEC and its allies (OPEC+) are expected to discuss possible easing of supply cuts, amid rebound in global demand.
→ UNEP says use of leaded petrol eradicated from globe.
→ USA makes unusual request to some of largest oil-consuming nations, including China, India, Japan to consider
releasing crude stocks in coordinated effort to reduce global energy prices. [Because OPEC and its allies rejected
repeated requests to increase production.]
→ India to release 5 million barrels of crude oil from its emergency stockpile in sync with USA, China, Japan, other major
economies to cool oil prices. [1st time ever that India is releasing stocks for such purposes].
→ China (world’s largest crude importer) is un-willing to release oil from its reserves on request from USA, while OPEC
producers are not increasing production of oil.]
 2022:
→ Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman gives “positive assessment” to their
cooperation on OPEC+ producers group to stabilize world oil market.
 Background:
• Saudi Arabia, other major Persian Gulf oil producers have so far resisted U.S. calls to increase output as
prices have surged amid crisis in Ukraine and concerns about possible sanctions on Russian exports.
→ USA ramps up efforts to bring India on board with sanctions on Russia and sends another senior official to discuss
India’s oil purchases and plans to use rupee-ruble payment mechanism to circumvent sanctions against Russia.
 Issue: India is heavily dependent on oil imports, bulk of which comes from Middle East, Africa, Europe, North
America, South America, SE Asia. Russia’s oil-related exports to India are only about USD 1 billion. Russia is keen
to scale this up even as US has announced ban on oil imports from Russia and UK has adopted more gradual
reduction (2022 Ukraine War). This offers opportunity for lucrative supply deal with 2nd largest oil exporter
(Russia) after Saudi Arabia. Rupee-Ruble payment system is crucial for bilateral non-oil trade as this would allow
Indian exporters to be paid in rupees.
→ G7 decided in 2022 G7 summit in Germany to explore far-reaching steps to cap Russia’s income from oil sales that
are financing 2022 Ukraine war.
 Implications of ban on Russian oil:
• It would force Russia to find other markets for oil sale.
• It may cause Russia loss of revenue.
• It will hurt Russia’s economy.
→ Reacting to OPEC+’s decision to cut oil production, White House says US President Joe Biden is “disappointed”, calling
decision “shortsighted”.
 Reason for oil cut:
• Fear of Recession: 2 million-barrel-per-day (BPD) cut from OPEC+ could spur recovery in oil prices that have
dropped to about USD 90 from USD 120 three months ago.
• Rising US interest rates means less investment available.

Page 566 of 719

 • Stronger Dollars means less return for petroleum-producing countries.
 Impact:
• It would become costlier for petroleum-dependent countries including India. Fear of rising inflation. BOP
crisis may escalate for import-dependent countries with low foreign exchanges e.g. Sri Lanka. However, real
impact of large cut would be smaller, given that some of OPEC+ members are failing to reach their output
quotas.
 Opposition to oil cut:
• USA because US will have midterm congressional election and Joe Biden wanted US gasoline prices to be
low.
• Import-dependent developing and developed countries want oil prices to be low to sustain economic
recovery.
→ Netherlands govt. to close gas field hit by earthquakes despite energy crisis: The Dutch government has doubled
down on its commitment to close Europe's largest natural gas field, the Groningen gas field. [The move comes as
Europe is scrambling to replace Russian fossil fuels following Moscow's conflict with Ukraine, and European
governments are funding massive public support measures to help households and businesses with skyrocketing
energy bills].
About:
 Retail oil price and crude oil price (linkage):
→ In theory, retail petrol and diesel prices are linked to global crude oil prices i.e. de-controlled. That is, if crude oil
prices fall, retails oil prices also come down, and vice versa.
 Implication of oil price rise:
→ On Oil Marketing Companies (OMCs) and consumers:
 On paper, OMCs are free to set prices for petrol and diesel based on international prices. But if govt. increases
central levies (excise duty) then it means that: consumer has not benefited from low international oil prices; and
urban population is more impacted than rural population. [though, weak monsoon may lead to rural India being
hit because farmers are forced to rely more on diesel-powered irrigation.]
 Consumers will face lower living standards. Consumers may find and switch to alternatives.
→ Rise in cost-push inflation.
→ Increase in CAD.
→ Likely to cause economic growth to slowdown.
→ Firms may cut back on investment.
→ Firms will seek to develop alternatives to oil.
 Concerns when supply / production is reduced:
→ As one of largest crude-consuming countries, India is concerned that reduction of crude production / supply by
producing countries will: hurt consumption-led recovery; and hurt consumers, especially in India’s price-sensitive
market.
 Strategic Petroleum Reserve (SPR) (India):
→ What:
 huge stockpiles of crude oil to deal with any crude oil-related crisis - risk of supply disruption from natural
disasters, war, other calamities. strategic in nature. crude oil stored will be used during oil shortage event.
construction of Strategic Crude Oil Storage facilities is being managed by Indian Strategic Petroleum Reserves
Limited (ISPRL)
→ Need:
 During 1990s Gulf war in West Asia, India was in major energy crisis. At that time, India’s oil reserves were
adequate for only 3 days. Though India managed to prevent energy crisis then, threat of energy disruption
continues till today.
 To address energy insecurity
 Today, Indian energy consumption is increasing.
 Oil can be bought and stored in large quantity when global oil price is low. It solves storage problem and saves
foreign exchange reserves.
→ Initiative:
 Indian Strategic Petroleum Reserves Ltd. (ISPRL), which has constructed 3 strategic petroleum reserves (SPR) at
- Padur, Karnataka [under construction]; Mangaluru, Karnataka; Visakhapatnam, Andhra Pradesh; Chandikhol,
Odisha [under construction].
→ Oil Stock:
 India stores about 5 million tonne or about 38 million barrels of crude oil in underground caverns at said 3
locations on east and west coast. Thus, about 22 days of oil consumption will be made available by ISPRL.
 Around February 2021 (India):
→ Global crude oil prices have been falling since February 2021 but retail petrol and diesel prices have not been falling
and instead it is on record high because:
 Govt. hiked excise duty to boost govt. revenues.

Page 567 of 719

 Crude oil prices rising in March 2021 (World / India):
→ Crude oil prices collapsed in 2020 because of COVID-19 pandemic and thus, crude oil demand fell down. But in March
2021, economies have started opening up – travels etc, factory output has picked up. Thus, global demand has
improved and crude oil prices have been recovering.
→ Controlled production (Supply) of crude oil: It has created crude oil demand to rise and thus boosting crude oil prices.
Ex. Saudi Arabia voluntarily cutting its daily production.
 Challenges being faced by India around June 2021:
→ Retail prices for petrol are crossing Rs. 100/- per litre in several States.
→ International oil prices have risen because of: consumption recovery (demand increase); and supplies low.
→ Inflationary pressures because of high oil prices.
→ Strategic petroleum reserves (SPR) are about to get exhausted.
→ India’s oil demand has also risen.
→ Note: Key reason for record high petrol and diesel prices is increased central and State taxes on petrol and diesel.
 Oil found in:
→ Oil reserves are found all over world. Top oil producing countries: United States, Saudi Arabia, Iran, Russia, China.
 Oil / Gas field and Earthquake:
→ Oil or Gas exploration can cause earthquakes: How:
 Oil or Gas exploration uses hydraulic fracturing to enhance energy extraction which can cause earthquake.
 Water flooding through injection wells causes pore pressure in hydrocarbon reservoirs to increase, and often
leading to induced seismicity.
 Fluid extraction from hydrocarbon reservoirs causes an increase in net effective stresses, which, when supported
by the geomechanics of the rock, may lead to the development of new faults and fractures. [Earthquakes caused
by fluid extraction need not happen at every place that sees extraction. The geomechanical properties of the
rock in question determine outcomes].
 Oil and US Dollar:
→ The U.S. dollar is the standard currency used to pay for oil globally, prompted by an agreement between the US and
Saudi Arabia in 1945. Countries that buy crude oil and those that produce it exchange Dollar in a system called the
petrodollar system.
→ Petrodollar System:
 The petrodollar system refers to the global practice of trading oil for US dollars. Oil-importing countries pay oil-
producing countries in dollars, which is why this arrangement is referred to as the petrodollar trade. The system
originated from an agreement where it was agreed that the US would provide weapons to Saudi Arabia, and in
return, Saudi Arabia would carry out crude oil sales in USD. Following this, the petrodollar system was
established and, today, applies to members of OPEC, Middle Eastern countries, and other nations that export
oil.
→ Petrodollar Recycling:
 In 1979, the United States and Saudi Arabia negotiated the United States-Saudi Arabian Joint Commission on
Economic Cooperation. They agreed to use U.S. dollars for oil contracts. The U.S. dollars would be recycled back
to USA through contracts with U.S. companies. These US companies improve Saudi infrastructure through
technology transfer.
 India and oil:
→ India’s own production has been below 700,000 barrels per day for long time.
→ ISPRL constructed 3 strategic petroleum reserves in huge underground rock caverns at Visakhapatnam, Mangaluru
and Padur.
→ Indian Oil imports:
 India is world’s 3rd-largest consumer of crude with 5.35 million barrels per day (mbpd), behind USA (largest),
China.
 India imports nearly 85% of its total crude oil consumption every year.
 India relies on West Asian supplies to meet over 3/5th of its demand.
 In 2022, Russia became India's top oil supplier, edging past traditionally dominant suppliers Saudi Arabia and
Iraq.
→ Implications of high oil prices for India:
 Increased import bill:
• Crude has a share of 30-33% in total imports and any hike in prices increases the import bill, thus negatively
affecting India’s CAD and increasing India’s fuel subsidies. [A CAD indicates that a country is importing more
than it is exporting].
 Inflation:
• Any increase in Crude Oil prices directly increases Inflation (unless subsidised by government).
 Inflation in imports:
• With a weaker Indian currency, all imported items will be more expensive in rupees, forcing the RBI to take
further action. However, RBI’s measure will lead to a decrease in India’s forex reserves.

Page 568 of 719

  Industries:
• User industries of oil like chemicals, plastics, fertilisers will face a problem again. Higher input costs will put
pressure on profit margins and any pass-through will be inflationary.
 States and Centre’s tax revenues:
• State governments will be better off as their VAT collections would increase automatically with an increase
in Oil prices. However, the Centre may not gain as the excise duty is a fixed rate e.g. Rs. 3.4 Per litre.
 Bond yields:
• Bond yields move up every time oil prices rise while stock markets turn volatile normally in the downward
direction. As a consequence, economic uncertainty will intensify once again. [The yield of a bond is the
interest rate investors earn when they buy the bond].
 Issue:
→ The problem with rising oil prices and a declining rupee is that these are external to the Indian system over which
there is little control. The RBI’s intervention and protection of Indian currency have their limitations. Thus, these
issues have to be responded to as they cannot be controlled by India.
 Way Forward:
→ India needs to reduce its dependence on imported oil (e.g. use of renewables, use of bio-fuels).
→ India should increase its export capacity to reduce any impact on its currency.
→ India should go for increased use of the Indian Rupee for International trade.
Note:
 Indian Strategic Petroleum Reserves Ltd. (ISPRL):
→ Special-purpose vehicle (SPV). wholly owned subsidiary of Oil Industry Development Board (OIDB), under Ministry of
Petroleum and Natural Gas (MoPNG). Indian company responsible for maintaining India's strategic petroleum
reserves (SPR).
 Organization of Petroleum Exporting Countries (OPEC) [1960]:
→ What:
 OPEC is one permanent intergovernmental organization of 13 countries. Founded in 1960 in Baghdad (Iraq) by
1st 5 members (Iran, Iraq, Kuwait, Saudi Arabia, Venezuela). headquartered in Vienna, Austria, although Austria
is not OPEC member state.
→ Objective:
 co-ordinate and unify petroleum policies. secure fair and stable prices for petroleum producers. efficient,
economic and regular supply of petroleum to consuming nations. To manage supply of oil, set price of oil in
world market, and avoid fluctuations that might affect economies of both producing and purchasing countries.
→ Feature:
 Membership is open to any country that is substantial exporter of oil and shares its ideals.
 Founder Members: Venezuela. Saudi Arabia. Iran. Iraq. Kuwait.
→ Significance:
 Estimated 44% of global oil production. 81.5% of world's proven oil reserves. OPEC is one major influencer on
global oil prices that were previously determined by so-called "Seven Sisters" grouping of multinational oil
companies.
 OPEC share in world crude oil reserves:
• about 80%.
• OPEC proven crude oil reserves (descending): Venezuela -> largest, Saudi Arabia, Iran, Iraq, Kuwait, …..
→ OPEC+:
 Alliance of crude producing countries who are undertaking corrections in supply in oil markets since 2017.
 OPEC + OPEC allies.
 Ex.: Azerbaijan, Bahrain, Oman, Russia, Kazakhstan.
 Leaded Petrol:
→ Harmful effects:
 Lead exposure have serious consequences for health of children – brain, nervous system - coma, convulsions,
even death, mental retardation, behavioral disorders, long-term effects on health.
 During pregnancy, impacts fetus.
 In adults - long-term harm, high blood pressure, kidney damage.
→ India banned leaded petrol in 2000.
 No Oil Producing and Exporting Cartels (NOPEC):
→ US bill to pressure OPEC+ oil group. If NOPEC is signed into law, US attorney general would gain option to sue oil
cartel or its members, such as Saudi Arabia, in federal court. NOPEC is intended to protect US consumers and
businesses from engineered oil spikes.
 Groningen Gas field:
→ The Groningen field has been a vital source of natural gas and income for the Netherlands since the 1960s. But
earthquakes and tremors linked to gas extraction in the field have been a source of stress and misery for local
residents, prompting the Dutch government to announce that the field would be shut down by the end of 2024.
Page 569 of 719
 Local residents in and around Groningen have been dealing with the fall-out of tremors and earthquakes for decades
- 1,470 earthquakes were recorded from 1986 to 2018.
Value Addition:
 Strategic Petroleum Reserve (SPR):
→ Global strategic petroleum reserves (GSPR) are crude oil inventories (or stockpiles) held by government of particular
country, or by private industry, to safeguard economy and help maintain national security during energy crisis.
→ Strategic reserves are intended to be used to cover short-term supply disruptions.
 Brent crude oil:
→ Blended oil (mix of brent, forties, oseberg and ekofisk) drilled from below North Sea.
→ It is refined into diesel fuel and gasoline.
→ In trading, Brent is one of benchmarks for oil in wider market like Europe, Middle East, Africa.
 WTI oil:
→ West Texas Intermediate oil
→ US crude with IG
→ blend of several oils drilled and processed in USA.
→ It is used for gasoline refining.
→ In trading world, WTI is primarily benchmark for US oil market.
Mains Link:
 To address energy insecurity, the government of India had mooted the concept of strategic petroleum reserves in 1998.
At present the demand for the same is growing stronger with each passing day. Discuss why such reserve is needed.
 How groups, such as OPEC, influence oil prices across the world? Discuss.
 Write a note on India’s Plan on strategic Petroleum reserves.
 Policymakers have little control over the dollar and crude oil. It is impossible to take a ca ll on how these prices
will move. Explain.

EXCHANGE RATE, CURRENCY

News:
 2021:
→ USA puts India under watch list for currency manipulators.
 2022:
→ US Federal Reserve announces most aggressive interest rate increase in almost 30 years, raising benchmark
borrowing rate by 0.75 % points / 75 basis points to bring down inflation to its target rate of 2% from current 9%.
However, there is fear that such as move may lead to USA going into recession and thus impacting India and world.
[Analysts believe that, over long run, rupee is likely to continue to depreciate against dollar given significant
differences in long run inflation between India and U.S. At moment, as U.S. Federal Reserve raises rates to tackle
historically high inflation in USA, other countries and emerging markets in particular will be forced to raise their own
interest rates to avoid disruptive capital outflows and to protect their currencies. RBI too has been trying to rein in
domestic consumer price inflation by raising rates and tightening liquidity. As interest rates rise across globe, threat
of global recession also rises as economies readjust to tighter monetary conditions].
→ Indian rupee hits all time low against US dollar weakening past 79 ru pees to 1 dollar mark and selling as
low as 79.05 against USD dollar. Many analysts expect rupee to weaken further in coming months and
move past 80 rupees to dollar mark. In fact, IMF expects rupee to weaken past 94 rupees to 1 dollar mark
by FY29.
→ Indian rupee breached psychologically significant exchange rate level of 80 to 1 US dollar.
 Why are rupee-dollar exchange rate and forex reserves falling?
• As investors are pulling money out of Indian market, there is fall in forex reserve and also less dollar in Indian
market would mean, value of dollar against rupee would increase. Thereby depreciating rupee.
• India has capital account surplus but CAD. [RBI keeps monitoring BOP every week and keeps intervening in
such manner which ensures that rupee’s exchange rate does not fluctuate too much].
→ India's largest lender State Bank of India says that RBI should make a conscious effort to internationalise the rupee
given that the 2022 Russia-Ukraine war and the disruptions to payments caused by it is a good opportunity to insist
on export settlement in rupee.
→ Impossible trinity - trilemma has come under focus recently as US Federal Reserve has been raising interest rates to
fight rising prices.
→ FM Nirmala Sitharaman says that the Indian rupee is holding ground at a time when US dollar has strengthened,
asserting that the fundamentals of India’s economy is strong and the inflation is low compared to other parts of the
world.
 US dollar is strengthening because of greater fiscal tightening in USA, rising US interest rates, instability triggered
by 2022 Russia-Ukraine war. Impact of strengthening of US dollar on India is that India’s forex reserve is at 2
year low due to increased import bill, increased CAD. However, not only the Indian rupee, but other global
currencies have depreciated too against US dollar and the Indian rupee has performed better compared to other
currencies.
Page 570 of 719
 → T. Rabi Sankar, an RBI deputy governor roots for internationalisation of rupee and also supports for taking up
unavoidable risks if India is to progress to be an economic superpower. He says there are many advantages to
internationalisation of rupee but, at the same time, there are risks associated with it which are unavoidable if India
wants to become an economic power.
→ The rupee’s dollar value has only 2 of 4 determinants in its favour and will need more flexibility to ease other
pressures. The currencies of most major economies have lost ground against the US dollar over the past year. The
rupee is no exception. Only 4 of the 34 currencies tracked by The Economist every week have appreciated against
the US dollar since October 2021 — those issued by Russia, Brazil, Mexico, and Peru. The Indian rupee depreciated
by more than 10%.
About:
 Background:
→ In floating exchange rate system, market forces (based on demand and supply of currency) determine value
of that currency. Currencies appreciate or depreciate against each other for variety of reasons, including
government policy, interest rates, trade balances, business cycles. Currency ap preciation discourages
country’s export activity as its products and services become costlier to buy.
 RBI’s aim:
→ Aim of RBI’s policy is to allow rupee to find its natural value in market but without undue volatility or
causing unnecessary panic among investors.
 Exchange rate:
→ What:
 In finance, exchange rate is rate at which one currency will be exchanged for another currency. Currencies are
most commonly national currencies, but may be sub-national as in case of Hong Kong or supra-national as in
case of euro.
→ Rupee exchange rate:
 Rupee’s exchange rate vis-a-vis dollar is essentially number of rupees one needs to buy for 1 USD. This is one
important metric to buy not just US goods but also other goods and services (say crude oil) trade which happens
in US dollars.
 International currency:
→ An international currency is one that is freely available to nonresidents, essentially to settle cross -border
transactions. It is an expression of external credibility in the currency as well as in the economy. All truly
international currencies belong to large, advanced economies. Their use for international transactions
confers substantial economic privileges to the host countries.
 Currency Depreciation:
→ What:
 Currency depreciation is fall in value of currency in floating exchange rate system. Rupee depreciation
means that rupee has become less valuable with respect to US dollar. It means that rupee is now
weaker than what it used to be earlier. For example: USD 1 used to equal to R s. 70, now USD 1 is equal
to Rs. 77, implying that rupee has depreciated relative to dollar i.e. it takes more rupees to purchase
1 dollar.
Currency depreciation can increase a country’s export activity as its products and services
become cheaper to buy. However, currency depreciation in one country can spread to other countries.
→ Depreciation of Indian Rupee:
 Factors that affect rupee depreciation:
• Structure of trade: India being the net importer of commodities, in 2022, the price of its import basket has
risen more than the price of its export basket, or a -ve terms-of-trade shock. This has led to more dollars
going out and thus currency depreciating.
• State of Current Account Balance: Countries that have current account surplus are less likely to experience
a sudden outflow of foreign money. India has a wide CAD right now (of about USD 120bn in 2022).
• Foreign exchange reserves: As the currency depreciates, RBI has to pump more dollars into the market to
stabilize it. This reduces the forex reserve.
• Borrowing: Since external debt has to be paid in dollars, it means dollars will go out of the country with
higher external debt. Thus depreciating currency further. Indian government borrowed close to USD 10bn
from multi-lateral agencies in FY21.
 General principles of the extent of currency depreciation:
• The extent a currency has depreciated against the US dollar is dependent on 4 factors:
 structure of its trade;
 state of its current account balance;
 availability of foreign exchange reserves to intervene in the market as well as the readiness to do so;
 extent of borrowing in international rather than domestic currencies.
 Impact: Depreciation in rupee is double-edged sword for RBI:
•
{Positive} {Negative}
Page 571 of 719
 Weaker rupee should theoretically give boost to It poses risk of imported inflation, and may make it
India’s exports. But in environment of uncertainty difficult for RBI to maintain interest rates at record
and weak global demand, fall in external value of low for longer.
rupee may not translate into higher exports.
Export of goods and services to other countries, India meets more than 2/3rd of its domestic oil
become cheaper. requirements through imports.
India is also one of top importers of edible oils.
Weaker currency will further escalate imported
edible oil prices and lead to higher food inflation.
Importing goods and services becomes costlier.
Weakening rupee hurts foreign investors, who
came looking for good return, as well as Indians,
who have loans abroad.
Weakening rupee makes oil imports costlier.
• Under normal circumstances, rupee depreciation is good for CAD because it leads to higher exports. But at
present in 2022, India is already facing high inflation and continued depreciation may be making matters
worse. Costlier imports (because of weaker rupee) add to cost-push inflation and bump up domestic
inflationary process.
 Should India’s policymakers prevent rupee fall?
• Experts say it is neither wise nor possible for RBI to prevent rupee from falling indefinitely. Defending rupee
will simply result in India exhausting its forex reserves over time because global investors have much bigger
financial power. Most analysts believe that better strategy is to let rupee depreciate and act as natural shock
absorber to adverse terms of trade.
 Remedy:
• RBI (which is in charge of monetary policy) should focus on containing inflation, as it is legally mandated to
do, and GOI (which is in charge of fiscal policy) should contain its borrowings.
• RBI usually instructs State run banks to sell US dollars in order to offer some support to rupee.
• In 2022, amid 30-year record high interest rate by US Fed, India took below steps to arrest rupee slide
against dollar:
 India eased rules for foreign investors to invest in Indian debt instruments.
 RBI temporarily removed CRR, SLR and interest rate cap on interest rate on NRE deposits. RBI eased
norms governing Foreign Currency Non-Resident Bank [FCNR(B)] and Non-resident External (NRE)
deposits. Banks will be able to offer higher returns to NRIs on their deposits. This will increase NRI
investment and thus help reduce slide of Indian rupee. This RBI’ easing of norms may arrest outflows
from NRE accounts.
 2022 Instance:
• In 2022, the rupee’s dollar value had only 2 of 4 determinants in its favour (mentioned above). The
currencies of most major economies had lost ground against the US dollar over the past year. The rupee
was no exception. The extent Indian currency depreciated against the US dollar in 2022 is dependent on
said 4 factors and explained as follows:
 Structure of India’s trade: 1st, a lot depends on whether a country is a net exporter or importer of
commodities. The former group has benefitted from rising energy prices while the latter has had to
bear costs. India falls squarely in the 2nd category. The price of India’s imports basket has risen more
than the price of its exports basket, or a -ve terms-of-trade shock.
[This factor is less favourable to India because of India being a net commodity importer].
 State of India’s current account balance: 2nd, partly linked to the 1st point is the current account balance
of a country. Countries with current account surpluses have less reason to worry about a sudden
withdrawal of foreign capital from their shores. India has a wide CAD right now in 2022, as the domestic
investment rate is higher than the domestic savings rate.
[This factor is also less favourable to India because of India has wide CAD].
 Availability of foreign exchange reserves to intervene in the market as well as the readiness to do so:
3rd, most emerging-market economies have learnt the hard lessons of previous episodes of economic
stress to build up a stock of precautionary savings in the form of foreign exchange reserves to deal with
sudden balance-of-payment shocks. India is one such country. Rich economies have less reason to do
so because they print global reserve currencies as well as have privileged access to the US printing press
through swap agreements.
[This factor is in favour of India because of its sizable stock of foreign exchange reserves].
 Extent of borrowing in international rather than domestic currencies: 4th, countries in which most of
the public debt is held by local investors have less reason to worry than countries in which the
proportion of dollar debt is higher. On this front, India has been very conservative. The Indian
government does not borrow abroad, and has provided foreign investors only limited access to its rupee
debt. However, Indian companies do borrow abroad.
Page 572 of 719
 [This factor is also in favour of India because of low levels of dollar debt].

{Condition} {Impact} {Industries benefited}
Rupee appreciates Export expensive, import cheaper Industry with high imported inputs
like engineering, drugs & pharma,
petro & petro products, gems &
jewellery.
Rupee depreciates Export cheaper, import expensive IT, textiles & textile products,
automobile, hotels & tourism, etc.
 Way Forward:
• In 2022, India still has adequate foreign exchange reserves in terms of standard metrics such as import
cover, foreign debt that is due within a year and the stock of broad money. However, the substantial fall in
the foreign exchange hoard in effect means that the exchange rate will have to play a bigger role in economic
adjustment.
• RBI could also use interest rates to defend the Indian rupee. However, a central bank (RBI) with a formal
inflation-targeting mandate should ideally use interest rates only to manage domestic demand and not the
exchange rate. Using one policy instrument to target 2 policy goals is never a good idea.
 Determination of rupee’s value:
→ Value of any currency is determined by demand for that currency as well as its supply. When supply of
currency increases, its value drops. In wider economy, central banks determine supply of currencies, while
demand for currencies depends on amount of goods and services produced in that economy.
In forex market, supply of rupee is determined by demand for imports and various foreign assets. So,
if there is high demand to import oil, it can lead to increase in supply of rupees in forex market and cause
rupee’s value to drop. And, demand for rupees in forex market depends on foreign demand for Indian
exports and other domestic assets.
When there is great enthusiasm among foreign investors to invest in India, it can lead to increase in
supply of dollars in forex market which in turn causes rupee’s value to rise against dollar.
 Internationalization of rupee:
→ What:
 Internationalisation of rupee means adopting full capital account convertibility. Capital account tracks
movement of capital between 2 countries via investments and loans.
A fully convertible capital account means that there is no restriction on the amount of rupees one can
convert into foreign currency to buy an asset overseas. Similarly, there are no restraints on overseas investors
to bring in dollars or acquire assets in India.
Internationalisation of the rupee is a process that involves increasing use of the local currency in cross-
border transactions. It involves promoting the rupee for import and export trade and then other current account
transactions followed by its use in capital account transactions.
→ Need:
 Excessive dependence on dollars combined with global inflation and economic crises has led to the depreciation
of the rupee to an all-time low. If the rupee is internationalized, India would not have to depend on US Dollars
for its trade.
→ Argument:

{Pros} {Cons}
Greater internationalization of rupee can lower Greater internationalization of rupee will complicate
transaction costs of cross-border trade and the conduct of monetary policy. It will limit India’s
investment operations by mitigating exchange rate ability to create a monetary policy specific to its local
risk. economic demand. The Indian economy will become
more susceptible to international economic
fluctuations. [Managed currency was utilized to
protect Indian economy from damages during the
economic crises of 1980 and 2008. It may not be the
case anymore].
Internationalization of rupee will ease foreign trade, Internationalization of rupee will make exchange rate
aid capital flows. stability a challenge.
Internationalization of rupee will mitigate exchange Internationalization of rupee could lead to
rate risks. uncontrolled capital flows.
Internationalization of rupee will reduce dependence Internationalization of rupee could make domestic
on FX reserves. It reduces the need for holding financial markets volatile.
foreign exchange reserves. [While reserves help
manage exchange rate volatility and project external
stability, they impose a cost on Indian economy. This
Page 573 of 719
 cost represents a transfer of income from India to
other countries. Reducing the requirement of
reserves would save some of this loss of income].
Internationalisation of rupee would reduce Hot money: Complete internationalization of rupee
dependence on foreign currency and that makes will expand the risk of hot currency (highly prone to
India less vulnerable to external shocks. Use of Rupee sudden outflows) to capital assets. Eg., east Asian
in cross-border transactions mitigates currency risk crisis in 1997.
for Indian business. Also, as the use of Rupee
becomes significant, the bargaining power of Indian
business would improve adding weight to the Indian
economy, enhancing India’s global stature and
respect.
In 2022, T. Rabi Sankar, an RBI deputy governor In 2022, T. Rabi Sankar, an RBI deputy governor
flagged India as a capital deficient country, and flagged India as a capital deficient country, and
therefore it needed foreign capital to fund its growth. therefore it needed foreign capital to fund its growth.
He further said if a substantial portion of its trade was He further said if a substantial portion of its trade was
in Rupee, non-residents would hold Rupee balances in Rupee, non-residents would hold Rupee balances
in India which would be used to acquire Indian assets. in India which would be used to acquire Indian assets.
However, large holdings of such financial assets could
heighten vulnerability to external shocks, and thus
managing which would necessitate more effective
policy tools.
It will improve the demand for the rupee in
international trade, and thus will appreciate currency
value.
Exchange rate volatility: Rupee-denominated
payments can help reduce price volatility associated
with dollars.
Making significant savings in Indian foreign reserves.
Circumvent sanctions: Improving acceptance and
trade in rupees can help India to diversify its trade
basket by circumventing restrictions and sanctions
imposed by the west.
Improve India’s standing as a global economic power.
→ Required steps for internationalization of rupee:
 Opening of rupee to complete capital account convertibility.
 Frame policies cautiously and test them in the Regulatory sandbox environment. Bilateral and multilateral trade
agreements can be used to test the viability of internationalized rupee e.g. using the Vostro account for Rupee
trade with Russia and Iran.
 Improvements in financial fundamentals and steps to improve sovereign credit ratings.
→ Status:
 In 2022, T. Rabi Sankar, an RBI deputy governor rooted for internationalisation of rupee and also supported for
taking up unavoidable risks if India was to progress to be an economic superpower.
 Currently, while the dollar accounts for 88% of international trade, Rupee accounts for < 1.7% of global trade.
 India currently has full convertibility of the rupee in current accounts such as for exports and imports. However,
India’s capital account convertibility is not full. There are ceilings on government and corporate debt, external
commercial borrowings and equity.
 RBI has allowed domestic traders to settle their import-export bills in rupee.
→ Way Forward:
 In 2022, T. Rabi Sankar, an RBI deputy governor said what India needed to do was calibrate its moves to the
evolving size of the domestic economy, particularly the size of the external sector and to its appetite for risk in
framing policy for external trade and capital flows. He says there are many advantages to internationalisation of
rupee but, at the same time, there are risks associated with it which are unavoidable if India wants to become
an economic power.
Note:
 NRI Account:
→ What:
 NRI account is account that NRI or PIO person can open with financial institution like bank. NRI account can be
current account, savings account, or deposits account. These accounts are governed or regulated by RBI FEMA
Regulation and Income Tax Act of India. Non-Resident Indian account / NRI can be opened by NRI or PIO with
any authorized bank in India. In India, there are 3 types of NRI accounts, namely - NRE account, NRO account,
FCNR account.
Page 574 of 719
→ Purpose:
 Saving or investing income that NRIs earn abroad or are earning in India.
→ Type:
 NRE account:
• Non-Resident External (NRE)
• This account is for saving or depositing earnings from abroad in India in Indian denomination.
• NRE Account is bank account for NRIs to deposit their earnings from abroad in Indian rupee. This rupee-
denominated account can be savings account, current account, fixed deposit account and recurring deposit
account. NRE account can be opened individually or jointly. However, joint account can be opened only with
another NRI.
• NRIs can open NRE account – introduced in 1970 — with funds remitted to India through bank abroad. This
is repatriable account and transfer from another NRE account or FCNR(B) account is also permitted.
 NRO account:
• Non-Resident Ordinary (NRO)
• It is for saving and managing Indian earnings in India in Indian denomination.
• NRO account is one of types of NRI account, which is useful for managing income that NRI is still earning in
India. Income can be in form of interest, dividend, rent, etc. NRO account facilitates money transfer abroad.
In this account, one can deposit money in Indian or foreign currency. However, withdrawals happen only in
Indian currency. Also, NRO accounts can be used for investing in India, for example, in mutual funds, shares
etc.
• NRO accounts may be opened / maintained in form of savings, recurring or fixed deposit accounts. These
are Rupee accounts opened for purpose of depositing income earned in India. These accounts can be held
jointly with NRI / resident Indians.
 FCNR account:
• Foreign Currency Non -Resident (FCNR)
• It is for depositing or saving foreign currency earnings in any of 9 currencies allowed by RBI.
• FCNR account is term account that allows NRIs to deposit money in any of 9 currencies currently allowed by
RBI. 9 currencies that this account accepts deposits are USD, GBP, AUD, SGD, CAD, CHF, HKD, EUR, JPY.
FCNR(B) account is term deposit account and not savings account. It allows NRI to deposit their money in
desired currency. Also, deposits made should be income from NRIs country of residence. One can also
transfer funds from NRE account to FCNR (B) account while opening.
• FCNR account is one term deposit account that can be maintained by NRIs and PIOs in foreign currency.
Thus, FCNRs are not savings accounts but fixed deposit accounts.
→ Type based on trading and investing purposes:
 Portfolio Investment Scheme (PIS) account:
• NRI investors who want to trade in the secondary market in India can do so under RBIs Portfolio Investment
Scheme (PIS)
 Non-Portfolio Investment Scheme (Non-PIS) account.
• For investors, who want to sell shares of IPO or shares they purchased when they were residents can do so
through Non-PIS accounts. They can also invest in mutual funds through Non-PIS accounts.
→ Difference between NRO, NRE, FCNR accounts:
 NRE account is bank account opened in India in name of NRI, to park his foreign earnings; whereas, NRO account
is bank account opened in India in name of NRI, to manage income earned by him in India. These incomes include
rent, dividend, pension, interest, etc.

{Basis of difference} {NRE} {NRO} {FCNR}
Purpose NRE account is for NRO Account is for FCNR account is for
depositing income depositing income that depositing earnings in
earned outside India in one earns in India. foreign currency in
India. Indian account.
Deposit Currency Foreign Currency Indian Rupee USD, GBP, AUD, SGD,
CAD, CHF, HKD, EUR, JPY
Withdrawal Currency Indian Rupee Indian Rupee Foreign Currency
Taxation in India Not taxable in India 30% tax rate applicable Not taxable in India
Exchange Rate Risk NRE account has foreign No foreign exchange risk No foreign exchange risk
exchange risk due to
currency fluctuations
Repairability Deposits and interest Deposits made in this Deposits and interest
earned on them are fully account are repatriable earned on them are fully
repatriable. to that NRI’s country of repatriable.

Page 575 of 719

 residence with certain
limits.
Joint Account with NRI Permitted Allowed Permitted
Joint Account with Indian Not Permitted Permitted Not Permitted
Resident
Types of Accounts Current Account, Savings Current Account, Savings Term deposits only
Account, Recurring, Account, Recurring,
Fixed Deposits Fixed Deposits
Loan against deposit Loan is given in Indian Available, in Indian Available, in foreign
Rupees. rupees. currency, however with
certain restrictions.
 US Currency Watch List:
→ In 2021, USA put India under watch list for currency manipulators.
→ India’s concerns against US Currency Watch List: Intrusion into policy space of central banks around world to meet
their mandates. It is mandate of central bank to provide stability in currency and thus central banks buy and sell
foreign currencies.
 Currency manipulation:
→ According to US Treasury department, currency manipulation means when countries deliberately influence exchange
rate between their currency and US dollar to gain unfair competitive advantage in international trade.
→ Impact: Trade surplus.
 Impossible trinity / Impossible trilemma / Unholy Trinity:
→ What:
 Impossible trinity is one concept in international economics which states that it is impossible to have all 3 of
following at same time:
• fixed foreign exchange rate;
• free capital movement (absence of capital controls);
• independent monetary policy.
→ Origin:
 It is both hypothesis based on uncovered interest rate parity condition, and finding from empirical studies where
governments that have tried to simultaneously pursue all 3 goals have failed. This concept was developed
independently by both John Marcus Fleming in 1962 and Robert Alexander Mundell between 1960 and 1963.
→ Example:
 Historically in advanced economies, periods pre-1914 and 1970–2014 were characterized by stable foreign
exchange rates and free capital movement, whereas monetary autonomy was limited. Periods 1914–1924 and
1950–1969 had restrictions on capital movement (e.g. capital controls), but exchange rate stability and
monetary autonomy were present.
Glossary:
 Hot money:
→ In economics, hot money is the flow of funds (or capital) from one country to another in order to earn a
short-term profit on interest rate differences and/or anticipated exchange rate shifts. These speculative
capital flows are called "hot money" because they can move very quickly in and out of markets, potentially
leading to market instability.
Question:
 FDI includes Foreign currency convertible bonds; Foreign institutional investment with certain conditions; Global
depository receipts. Non-resident external deposits / Non-Resident External (NRE) account is one rupee-dominated
account opened by NRI to facilitate deposit of foreign currency earnings. NRE is not FDI.
Mains Link:
 Why are countries increasing their interest rates? What are the ways in which the RBI has tried to cushion the fall of the
rupee? (200 Words, 10 Marks)
 What is the depreciation of the Indian rupee? Examine the factors behind its recent depreciation and its impact on the
economy in general.
 The falling value of the rupee will lead to several problems in the Indian economy. Examine the causes of the problem
and suggest steps to deal with this challenge? (250 words)
 What do you understand by Capital Account Convertibility (CAA)? There is a debate going on about whether India should
go for full CAA or for partial CAA. Examine the advantages and disadvantages of both full and partial CAA. Based on this
examination, suggest whether India should go for full CAA or not. (15M)

SATELLITE
News:
 2020:
→ ISRO launches EOS-01.

Page 576 of 719

 → ISRO placed CMS-01 communication satellite, on board PSLV-C50, into Geosynchronous Transfer Orbit
(GTO).
 2021:
→ Sattellite carrier PSLV-C51 successfully launched by ISRO’s commercial arm, NewSpace India Ltd (NSIL).
→ EOS-03 launch onboard GSLV-F10 fails.
→ NASA launches Landsat 9.
 2022:
→ ISRO’s Small Satellite Launch Vehicle (SSLV) is likely to have its maiden development flight in 2022.
→ ISRO successfully launches EOS-04, INSPIREsat-1, INS-2TD satellites onboard PSLV.
→ Jio forms joint-venture with SES S.A. (Luxembourg-based) to deliver satellite broadband services across
India.
→ ISRO ready for maiden flight of its mini rocket launcher – Small Satellite Launch Vehicle (SSLV).
→ GSAT-7B satellite gets acceptance of necessity from Defence Ministry.
→ National-level Failure Analysis Committee (FAC) find that 2021 EOS-03 mission onboard GSLV-F10 failed due
to deviation in performance of cryogenic upper stage (CUS) of launch vehicle.
→ SpaceX launches one rocket carrying 53 satellites for Starlink internet constellation from Cali fornia onboard
Falcon 9 rocket. [SpaceX has already launched more than 2,500 Starlink satellites to date but plans to
increase many more].
→ NewSpace India Limited (NSIL) launches GSAT-24 in its 1 st “demand-driven” communication satellite mission
post space sector reforms, leasing entire capacity on board to Direct -to-Home (DTH) service provider Tata
Play.
→ ISRO successfully launches PSLV Orbital Experimental Module (POEM).
→ GOi says India’s satellite-based navigation system, NavIC, is as good as GPS of USA in terms of position
accuracy and availability in its service region.
→ ISRO launches maiden flight of its SSLV-D1 (Small Satellite Launch Vehicle) from Satish Dhawan Space
Centre, in Sriharikota. SSLV-D1 rocket placed satellites into 356 km x 76 km elliptical orbit instead of 356
km circular orbit. Satellites are no longer usable as ISRO took to Twitter to inform that SSLV -D1 rocket had
placed satellites into in wrong orbit therefore rendering it un -useable.
→ India's 1 st commercial satellite broadband service: Hughes Communications India (HCI) Ltd. in collaboration
with ISRO launches its 1 st high throughput satellite (HTS) broadband internet service in India. From NE India
to remote parts of Leh and Ladakh, this company, using ISRO's Ku-band capacity of GSAT-11 and GSAT-29
satellites, promises to deliver high-speed satellite broadband services to remote locations across India.
[Through HTS technology, this company is already providing assistance to Indian Army, and paramilitary
forces patrolling LAC and other remote border outposts.].
→ ISRO Chairman S. Somanath says ISRO is developing a Next-Gen Launch Vehicle (NGLV), which will one day
replace operational systems like PSLV.
→ Under proposed 'Bharat Krishi Satellite' programme of GOI, ISRO proposes dedicated satellites for
supporting India’s agriculture sector. [A minimum of 2 satellites will be needed for adequate coverage of
India’s agricultural area. Currently used satellites for agriculture are - Resourcesat (for crop production
forecast), Cartosat (topographic mapping), RISAT (weather imaging)].
→ ISRO's heaviest rocket LVM3 (earlier called GSLV Mk III) launches British start-up OneWeb's 36 broadband satellites
from the spaceport in Andhra Pradesh's Sriharikota, marking LVM3 launcher's entry into the global commercial
launch service market. [India's Bharti Enterprises is a major investor and shareholder in OneWeb].
→ ISRO Chairman S. Somanath says ISRO is working on a series of improvements to the NavIC, or India’s equivalent of
the Global Positioning System (GPS), so that more people are motivated to install it and use it. Plans are also afoot
to make its reach global rather than circumscribe it to India and a limited territory around it.
About:
 Satellite Orbit / Orbit of Satellite [Types]:
→ Low Earth Orbit (LEO):
 100 – 1500 km
 Polar Orbit: Pole to pole orbit around Earth. Inclination of 90 degrees.
 …
→ Medium Earth Orbit (MEO):
 5000 – 20,000 km
→ Geosynchonous Orbit (GSO):
 Earth-centered orbit with orbital period equal to Earth's rotation on its axis (one sidereal day)
 Feature:
• Usually, circular. Around 36000 km.
 Type:
• Geostationary Orbit (GEO):
 GSO that coincides with Earth equotorial plane.

Page 577 of 719

  Feature: circular GSO
• ..
→ Sun-synchronous orbit (SSO):
 It means sync with Sun.
 satellites that need constant amount of sunlight for its services are placed in SSO. Why:
• Satellites that take pictures of Earth would work best in bright sunlight
• Satellites that measure longwave radiations would work best in complete darkness.
→ Highly Elliptical Orbit (HEO):
 Transfer Orbit (TO):
• What:
 elliptical orbit used to transfer between 2 circular orbits of different radiiaround central body in
same plane
• Geosynchronous / Geostationary Transfer Orbit (GTO):
 Satellite destined for GSO or GEO is usually put first into GTO by its launch vehicle using launch vehicle's
high-thrust engines. Then satellite moves from GTO into GSO or GEO using its own engines - usually
very efficient but low-thrust engine.
• Significance:
 GTO can be used to transfer satellite to GEO
→ Lagrange points (L-points).
 Types:
→ Lower Earth Orbit (LEO) satellite:
 LEO satellites are positioned at altitude of 500-1,200 km.
 LEO is densely populated with thousands of satellites in operation today, primarily addressing science, imaging,
low-bandwidth telecommunications needs.
 Hundreds of LEO satellites are needed to provide coverage to larger area on earth.
 LEO satellites are smaller and are cheaper to launch than GEOs or MEOs.
 LEO satellites have risks. Example - 2022 Starlink incident (geomagnetic storm) in which its satellites fell out of
orbit as result of solar flare.
 Polar Satellite:
• What:
 Satellite that revolves around Earth in near polar orbit. Ex. IRS Satellites.
• Feature:
 orbital period is around 90 mins
 scans / sees every part of Earth as Earth rotates underneath it.
• Usage:
 Remote sensing, Resource mapping, measuring O3 concentrations in stratosphere, measuring
temperatures in atmosphere.
→ Medium Earth Orbit (MEO) satellite:
 MEO satellites are positioned at altitudes of 5,000-20,000km.
 MEO has historically been used for GPS and other navigation applications.
→ Geosynchonous (GSO) satellite:
 What:
• Satellite that revolves around Earth in GSO. When satellites are about 36,000 km from Earth’s surface, they
enter what is called high Earth orbit. Here, it orbits in sync with Earth’s rotation, creating impression that
satellite is stationary over one single longitude. Such satellite is said to be geosynchronous.Geosynchronous
satellites have sweet spot over equator that allows them to stay over one spot on Earth.
 Feature
• Synchronization with Earth: Earth rotation period = satellite revolution (orbital) period. That is, time taken
by Earth to rotate on its owe axis and that by satellite to orbit Earth is same. Thus, by Kepler’s Planetary Law,
distance should be around36000 km.
 Significance:
• For observer on Earth's surface, GSO satellite returns to same position in sky after period of one sidereal
day.
 Usage:
• Communication.
 Type:
• Geostationary (GEO) satellite:
 What:
o Satellite that revolves around Earth in GEO.
o GEO satellites match rotation of Earth as they travel, and so remain above same point on ground.
 Feature:
Page 578 of 719
 o 36,000 km
o GEO satellites are positioned at altitude of 36,000 km. Altitude of satellite is directly proportional
to area of earth that it covers. Therefore, higher satellite is positioned, larger area that it covers.
o GEO satellites provide larger coverage and therefore only 3 satellites can cover whole earth.
 Significance:
o For observer on Earth's surface, GEO satellite stays roughly in same position in sky at all times.
 Usage:
o Hundreds of GEO satellites are in orbit today, traditionally delivering services like weather data,
broadcast TV, low-speed data communication.
o observe almost full hemisphere of Earth thus it can study large scale phenomenon: hurricanes,
cyclone etc.
o Communication: Communications satellites are often placed in GEO so that antennas on Earth that
communicate with them do not have to move and can be pointed permanently at fixed location in
sky where they appear.
 Disadvantage:
o They are very far away and thus have poor resolution
o Difficult to monitor activities near Earth poles.
 Note:
o All geostationary (GEO) satellites are geosynchronous (GSO) satellites. But, not all geosynchronous
satellites are geostationary satellites.
→ Sun-synchronous (SSO) satellite:
 pass over section of Earth at same time of day (local solar time). To achieve this, satellite shifts its orbit by
principle of gravity. [Gravity at equator (due to bulge) > gravity at poles].
 Polar-orbiting satellites have sweet spot that allows them to stay in one place. This orbit is Sun-synchronous
orbit, which means that whenever and wherever satellite crosses equator, local solar time on ground is always
same.
 Usage:
• Satellites that take pictures of Earth.
• Satellites that measure longwave radiations.
 High-throughput satellite (HTS):
→ What:
 One communications satellite that provides more throughput than classic FSS satellite (at least twice, though
usually by factor of 20 or more) for same amount of allocated orbital spectrum, thus significantly reducing cost-
per-bit. HTS differs from conventional satellite in sense that it increases capacity when using same amount of
orbital spectrum while simultaneously reducing cost per bit.
 Space-based communications networks / Satellite Internet:
→ Challenge in India:
 Currently, satellite communications / satellite internet are used only by corporates and institutions, trans-
continental communications, and connecting remote areas.
→ Benefits:
 Satellite internet will be essential for broadband inclusion in remote areas and sparsely populated locations
where terrestrial networks have not reached.
→ Many Indian and international companies are betting on satellite communications as next step to provide internet
connectivity. This includes:
 StarLink (SpaceX):
• satellite internet constellation operated by SpaceX.
• Network of thousands of satellites. Under Starlink project, SpaceX company intends to evolve into
constellation of nearly 12,000 satellites.
• It operates in LEO, which is increasingly getting crowded.
• about 1,900 Starlink satellites.
• could make internet 40 times faster.
• It is SpaceX’s project to build broadband network with cluster of orbiting spacecrafts.
• Starlink network is one of many ongoing efforts to start beaming data signals from space.
• Aim is to provide low-cost and reliable space-based Internet services to world.
• Elon Musk-led Starlink primarily has satellites in low earth orbit (LEO).
 OneWeb:
• of Sunil Bharti Mittal
• OneWeb primarily has satellites in low earth orbit (LEO).
 Project Kuiper (Amazon)
 US satellite maker Hughes Communications
 Jio - SES S.S. satellite broadband service:

Page 579 of 719

 • Jio satellite broadband service
• joint-venture between Jio and SES S.A. (Luxembourg-based) to deliver satellite broadband services across
India.
• It will use multi-orbit space networks that is combination of geostationary equatorial orbit (GEO) and
medium earth orbit (MEO) satellite constellations capable of delivering multi-gigabit links and capacity to
enterprises, mobile backhaul, retail customers across India and neighbouring regions.
• SES primarily has satellites in GEO and MEO
 …
→ Why use low earth orbit (LEO) instead of geostationary orbit:
 Geostationary satellite:
• Geostationary orbit is located at about 36,000 km over Earth’s surface, directly above Equator.
Geostationary satellites in this orbit complete one revolution of Earth in same time that earth rotates once
on its axis. Hence, to observer on earth ground, geostationary satellite appears stationary.
 Advantages of geostationary satellite:
• Signals from geostationary orbit can cover large part of Earth. Signals from one geostationary satellite can
cover roughly 1/3rd of earth. Thus, 3 or 4 geostationary satellites would be enough to cover entire Earth.
• Also, because geostationary satellites appear to be stationary, it is easier to link to them.
 Then, why geostationary satellite is not used for satellite communication:
• geostationary satellite gives rise to high time lag (latency) — between user seeking data on earth and server
sending that data from geostationary satellite.
• Longer distance that needs to be covered, greater is time lag (latency).
 Solution to this problem:
• Satellite in lower orbit from Earth’s surface (LEO), can bring down latency to roughly time it takes for
terrestrial systems to transfer data.
→ Low Earth Orbit (LEO) Satellite Internet:
 Benefits:
• LEO satellites are positioned nearer to earth, compared to stationary orbit satellites. Since LEO satellites
orbit closer to earth, they are able to provide: stronger signals and faster speeds.
• Since signals travel faster through space than fibre-optic cables, LEO satellite-based internet has potential
to rival existing ground-based internet networks.
• LEO satellites are smaller and are cheaper to launch than GEOs or MEOs.
 Challenges:
• LEO satellite travels at high speed and completes full circuit of Earth in 90-120 minutes. Therefore, individual
LEO satellites can only make direct contact with land transmitter for short period of time and thus requiring
many LEO satellite fleets and consequently, significant capital investment.
• Because of their lower height, LEO sat signals cover relatively small area. Thus, many LEO satellites are
needed in order to reach signals to every part of earth.
 Potential:
• LEO satellite broadband is preferable in areas that cannot be reached by fibre and spectrum services.
Therefore, LEO satellites’ internet target market will be rural and military units operating away from urban
areas.
 Criticisms:
• Regulation:
 Most LEO satellites projects are run by private companies. Therefore, regulation is challenge especially
considering high number of nations that contribute to individual projects.
 Complicated regulatory framework because stakeholders in these companies are from various
countries, and thus difficult to receive requisite licences to operate in each country.
• Sometimes, LEO satellites can be seen in night skies and reflect sunlight to earth. This creates difficulties for
astronomers, who watches sky at night, creating unwanted images.
• LEO satellites can interrupt frequency of other satellites orbiting above them.
• Increased space debris. Hundreds of LEO satellites are needed to provide coverage to larger area on earth.
• Potential to damage spacecraft or collide with other satellites, especially space junks.
• LEO satellites have risks. Example – 2022 Starlink incident (geomagnetic storm) in which its satellites fell out
of orbit as result of solar flare.
 LANDSAT [1970s]:
→ What:
 Landsat series / missions / Landsat program is longest-running program / mission for acquisition of satellite
imagery of Earth.
 by NASA
 Satellites to take images of Earth.
→ Names:
Page 580 of 719
  Landsat 1 [1970s]
 …
 Landsat 9 [2021]:
• Earth monitoring satellite.
• by NASA.
• among most technologically advanced satellite.
• It can see more colour shades with greater depths (measuring different wavelengths of light reflected off
Earth’s surface), helping scientists capture more details about our ever-changing planet.
→ Significance:
 Landsat satellites have collected images of our planet – earth’s surface etc. They helped understand how land
usage has changed over decades.
 In 2008, it was decided that all Landsat images will be free and publicly available. This helped researchers,
farmers, policy analysts, glaciologists, seismologists.
 Landsat images are used to study health of forests, coral reefs, monitor water quality, melting glaciers.
 Landsat help monitor climate change:
• If forest is affected by drought, it will be seen in Landsat images and can help researchers decode areas at
risk.
• During wildfire, Landsat images will capture smokes and help study extent of burning.
• Satellite images can help knowing sites for replanting.
• Landsat images can help identify water bodies affected by potentially harmful algal blooms.
 Navigation Satellite System Constellation:
→ India – NAVIC (regional); US – GPS (Worldwide); China – Beidou; Russia – GLONASS; EU - Galileo
 India:
→ Navigation with Indian Constellation (NavIC) [2013]:
 What:
• Indian Regional Navigation Satellite System (IRNSS), with an operational name of NavIC is an autonomous
regional satellite navigation system that provides accurate real-time positioning and timing services.
• earlier known as Indian Regional Navigation Satellite System (IRNSS) developed by ISRO. Constellation of
Navigation Satellite System of India. Independent. Regional. NavIC is India’s regional navigation satellite
system similar to US GPS operationalized.
• NavIC is India’s equivalent of the Global Positioning System (GPS).
• NavIC is a constellation of 7 satellites that is akin to the American GPS, the European Galileo and the Russian
GLONASS, and can be used to track location. The 1st of these satellites (IRNSS-1A) were launched in 2013
and the latest in 2018. There are plans to expand the NavIC system by increasing its constellation size from
7 to 11.
 Aim:
• To provide reliable position, navigation and timing services over India and its neighbourhood. To provide
position information in: Indian region; and 1500 km around Indian mainland.
 Composition:
• 7 satellites in orbit:
 3 satellites: Geostationary over Indian Ocean i.e. stationary in sky over that region.
 4 satellites: Geosynchronous over Indian Ocean i.e. appearing at same point in sky at same time every
day.
 Feature:
• It covers India and a region extending 1,500 km around it, with plans for further extension.
• Its extended service area lies between the primary service area and a rectangle area enclosed by the 30th
parallel south to the 50th parallel north and the 30th meridian east to the 130th meridian east, 1,500–6,000
km beyond borders.
• The system currently consists of a constellation of 8 satellites, with 2 additional satellites on ground as
stand-by.
• The constellation is in orbit as of 2018.
• NavIC will provide 2 levels of service, the "standard positioning service", which will be open for civilian use,
and a "restricted service" (an encrypted one) for authorised users (including the military).
• It provides accurate domestic navigation services to 1500km radius over sub-continent.
• NavIC can help in navigation on land, air, sea and also in disaster management.
• NavIC satellites are placed at higher orbit than GPS of USA. NavIC satellites are placed in geostationary orbit
(GEO) & geosynchronous orbit (GSO) with altitude of about 36,000 km. GPS satellites are placed in medium
earth orbit (MEO) with altitude of about 20,000 km.
• NavIC uses dual frequency bands, which improves accuracy of dual frequency receivers by enabling them to
correct atmospheric errors through simultaneous use of 2 frequencies. It helps in better reliability and
availability because signal from either frequency can serve positioning requirement equally well.
Page 581 of 719
 •Services provided:
 Standard Positioning Service (SPS): Provided to all users.
 Restricted Service (RS): It is encrypted service and only to authorised users.
 Application:
• Navigation: Terrestrial (visual and voice navigation for drivers, hikers, travellers etc); Aerial; Marine; Disaster
Management; Vehicle tracking; mobile phones – messaging etc; Precise Timing; Mapping.
• Terrestrial, aerial and marine navigation. Disaster management. Vehicle tracking and fleet management
(especially for mining and transportation sector). Integration with mobile phones. Precise timing (as for
ATMs and power grids). Mapping and geodetic data capture.
• NavIC-based trackers are compulsory on commercial vehicles in India and some consumer mobile phones
with support for it and have been available since 2020.
 Status:
• In 2022, ISRO Chairman S. Somanath says ISRO is working on a series of improvements to the NavIC, or
India’s equivalent of the Global Positioning System (GPS), so that more people are motivated to install it
and use it. And that, plans are also afoot to make its reach global rather than circumscribe it to India and a
limited territory around it.
• Though available for use in mainland India as well as a range of 1,500 km around it, it isn’t in wide regular
use in India primarily because mobile phones haven’t been made compatible to process its signals. GOI has
been pressing manufacturers to add compatibility and has set a deadline of January 2023 but media reports
suggest this is unlikely before 2025.
• Currently, NavIC satellites orbit the earth in a geostationary or geosynchronous (GEO) orbit or about 36,000
km from earth.
 Significance of indigenous navigation system:
• India as net security provider. assurance policies e.g. US GPS denial during Kargil War. disasters
management - tsunami in Indian Ocean region.
→ CMS-01:
 communication satellite
 launched by ISRO
 on board PSLV-C50
 services in extended C Band of frequency spectrum.
 Coverage: Indian mainland, Andaman & Nicobar, Lakshadweep islands.
 lifeline of about 7 years.
→ CMS-02:
 Formerly known as GSAT-24 which is one 24-Ku band communication satellite weighing 4180 kg with pan-India
coverage for meeting DTH application needs.
 CMS-02 is one Indian Communication Satellite built by ISRO. It is funded, owned and operated by New Space
India Limited. Entire capacity onboard CMS-02 satellite will be leased to Tata Play. CMS-02 is ''1st demand driven
mission'' undertaken by NSIL, that is, it will increase functionality as more customers require its use.
→ EOS-Series (India):
 What:
• Earth Observation Satellites (EOS) of India
 Kinds:
• EOS-01:
 Radar Imaging Satellite (RISAT)
 will work together with RISAT-2B, RISAT-2BR1.
• EOS-03:
 1st state-of-art agile Earth Observation Satellite which would have been placed in geo-synchronous orbit
around Earth.
 geo-imaging satellite for earth observation.
 capable of imaging whole country (India)
 geostationary satellite.
 real-time imaging and monitoring of natural disasters, waterbodies, crops, forest cover changes etc.
 Its launched in 2021 failed.
• EOS-04 [2022]:
 Radar Imaging Satellite
 It will provide high quality images under all weather conditions for applications like Agriculture, Forestry
& Plantations, Soil Moisture & Hydrology, Flood mapping.
 launched onboard PSLV-C52 / EOS-04 Mission [2022]
 injected successfully into sun-synchronous polar orbit of 529 km.
 It will collect earth observation data in C-Band and it will complement / supplement data from
Resourcesat, Cartosat, RISAT-2B series.

Page 582 of 719

 • RESOURCESAT - 2, 2A
• CARTOSAT - 1, 2, 2A, 2B
• RISAT – 1, 2
• OCEANSAT – 2
• Megha-Tropiques
• SARAL
• SCATSAT – 1
• INSAT - 3DR, 3D
• ...
 Usage:
• Land and forest mapping and monitoring.
• mapping of resources - water, minerals, fishes.
• monitoring of water bodies, crops, vegetation condition, forest cover changes
• weather and climate observations
• real-time monitoring of natural disasters – floods, cyclones
• soil assessment.
• Geo-spatial contour mapping.
→ INS-2TD [2022]:
 technology demonstrator satellite
 from ISRO
 precursor to India-Bhutan Joint Satellite (INS-2B).
 launched onboard PSLV-C52 / EOS-04 Mission [2022]
 injected successfully into sun-synchronous polar orbit of 529 km.
 It has thermal imaging camera.
 It will collect data about land surface temperature, water surface temperature of wetlands / lakes, mapping /
delineation of vegetation (crops, forest), thermal inertia (day, night).
→ INSPIREsat-1 [2022]:
 student satellite
 to collect data about ionosphere dynamics and sun’s coronal heating processes.
 launched by ISRO onboard PSLV-C52 / EOS-04 Mission [2022]
 developed by / from Indian Institute of Space Science & Technology (IIST), Kerala.
 injected successfully into sun-synchronous polar orbit of 529 km.
→ GSAT series:
 India's (ISRO) indigenously developed (Geosynchronous Satellite) communications satellites, used for digital
audio, data and video broadcasting. As of 2018, 20 GSAT satellites of ISRO have been launched out of which 14
satellites are in service. Example - GSAT-6, GSAT-7, GSAT-7A (which is military satellite), GSAT-24 (now known
as CMS-02) etc.
 These are India’s indigenously developed communications satellites, used for digital audio, data and video
broadcasting.
 GSAT-24:
• now known as CMS-02. It is one 24-Ku band communication satellite weighing 4180 kg with pan-India
coverage for meeting DTH application needs.
• CMS-02 (formerly known as GSAT-24) is one Indian Communication Satellite built by ISRO. It is funded,
owned and operated by New Space India Limited. Entire capacity onboard CMS-02 satellite will be leased
to Tata Play. CMS-02 is ''1st demand driven mission'' undertaken by NSIL, that is, it will increase functionality
as more customers require its use.
→ Military Satellite [India]:
 GSAT-7 series:
• advanced satellites developed by ISRO to meet communication needs of India’s defence services.
• GSAT-7 / INSAT-4F [2013]:
 also called Rukmini
 India’s 1stmilitary satellite
 multi-band military communications satellite
 developed by ISRO.
 Indian Navy is user of this communication spacecraft.
 It provides services for military communication needs, including low bit voice rate to high bit rate data
facilities, multi-band communications.
 It will enable Indian navy to extend its blue water capabilities and stop relying on foreign satellites like
Inmarsat (UK), which provide communication services to its ships.
• GSAT-7A [2018]:
 advanced military communications satellite
Page 583 of 719
  meant primarily for Indian Air Force (IAF) with Indian Army using 30% of its capacity.
 helps in boosting connectivity between ground radar stations, airbases and airborne early warning and
control aircraft (AEW&C) of IAF.
• GSAT-7B:
 dedicated satellite for Indian Army.
 It would help Indian Army enhance its surveillance in border areas.
 It will primarily fulfil communication needs of Indian Army.
 This means that Indian Army’s vast array of radio communication equipment could come under one
single platform.
→ Present status:
 India currently has 53 operational satellites in space, of which 21 are earth observation ones and another 21 are
communication-based.
 Satellite Launch Vehicle (SLV):
→ What:
 small-lift launch vehicle project started in early 1970s by ISRO to develop technology to launch satellites.
 India has 2 operational launchers – Polar Satellite Launch Vehicle (PSLV), Geosynchronous Satellite Launch
Vehicle (GSLV).
→ India:
 Types:
• Augmented Satellite Launch Vehicle (ASLV)
• Satellite Launch Vehicle (SLV):
 It was a small-lift launch vehicle project started in the early 1970s by ISRO to develop the technology
needed to launch satellites. SLV was intended to reach a height of 400 kilometres and carry a payload
of 40 kg.
• Polar Satellite Launch Vehicle (PSLV):
 What:
o launch system of ISRO.
o indigenously-developed
o ISRO’s work-horse
 Feature:
o category of medium-lift launchers
o PSLV can launch satellites weighing in range of 1000 kg.
o It takes 70 days to integrate PSLV.
o 3rd generation launch vehicle of India.
o 1st Indian launch vehicle to be equipped with liquid stages.
 Why:
o PSLV was developed to launch low-Earth Orbit (LEO) satellites into polar & sun synchronous orbits.
 Orbits capable:
o Polar Sun Synchronous Orbit (SSO)
o Low Earth Orbit (LEO)
o Geo Synchronous Transfer Orbit (GTO)
 All operations of PSLV are from Satish Dhawan Space Center, Sriharikota, Odisha.
 Significance:
o PSLV has proved its versatility by launching geosynchronous, lunar, interplanetary spacecraft
successfully.
 PSLV Orbital Experimental Module (POEM) [2022]:
o POEM is one platform that will help perform in-orbit experiments using final (4th stage), and
otherwise discarded, stage of PSLV. [PSLV is one 4-stage rocket where 1st 3 spent stages fall back
into ocean, and final stage (PS4) — after launching satellite into orbit — ends up as space junk]. In
PSLV-C53, this final stage / 4th stage is being utilized as “stabilised platform” to perform
experiments. It is 1st time that PS4 stage would orbit earth as one stabilised platform. [ISRO 1st
demonstrated capability of using PS4 as orbital platform in 2019 with PSLV-C44 mission that
injected Microsat-R and Kalamsat-V2 satellites into their designated orbits. 4th stage in that mission
was kept alive as orbital platform for space-based experiments.]
o Payload: POEM is carrying 6 payloads, including 2 from Digantara (Indian space start-up) and
Dhruva Space (Indian space start-up).
o Significance: Inclusion of public-private partnerships, less space debris problem.
o Background: In 2022, PSLV-C53 launcher carried DS-EO satellite into LEO. PSLV-C53 is 2nd dedicated
commercial mission of NewSpace India Limited (NSIL). This mission proposes to demonstrate
utilization of spent upper stage of launch vehicle as stabilized platform for scientific payloads
subsequent to separation of satellites (POEM). PSLV-C53 injected DS-EO satellite into orbit (DS-EO

Page 584 of 719

 carries one Electro-Optic, multi-spectral payload that will provide full color images for land
classification, and serving Humanitarian Assistance and Disaster Relief needs).
• Geosynchronous Satellite Launch Vehicle (GSLV)
 What:
o GSLV Rocket expands to geosynchronous satellite launch vehicle.
o GSLV Mark III is 3-stage heavy lift launch vehicle developed by ISRO. (2 solid strap-ons, 1 core liquid
booster, 1 cryogenic upper stage)
 Feature:
o To launch satellites in orbits that are synchronous with Earth’s orbit.
o Satellites can weigh up to 2,500 kg and are 1st launched into transfer orbits.
o In its 3rd and final stage, GSLV uses indigenously developed cryogenic upper stage.
 Why:
o GSLV was developed to launch heavier INSAT class of geosynchronous satellites into orbit.
• Small Satellite Launch Vehicle (SSLV):
 What:
o SSLV is one small-lift launch vehicle developed by ISRO with payload capacity to deliver 500 kg to
LEO (500 km) or 300 kg to Sun-synchronous orbit (500 km) for launching small satellites, with
capability to support multiple orbital drop-offs. Indigenous. mini-rocket-launcher specially
designed to carry smaller commercial satellites into low-earth orbit (LEO) from 200-2,000 km
above Earth’s surface. ISRO Chairman Somanath himself is credited with design and development
of SSLV during his time as director of Vikram Sarabhai Space Centre (Kerala) in 2018. SSLV is
smallest vehicle aimed at launching small satellites into Earth’s low orbits.
 Objective:
o Launch of small satellites into low earth orbits (LEO).
 Feature:
o It is 3-stage all-solid vehicle with capacity to launch 500kg satellite into 500 km LEO and 300kg into
Sun-synchronous Orbit. It can carry satellites weighing up to 500 kg to low earth orbit (LEO).
smallest vehicle at 110-ton mass at ISRO. It will take only 72 hours to integrate. Only 6 people will
be required to do said job. Cost will be only around Rs 30 crore. Designed to bolster agency’s
partnership with private sector for launch of commercial satellites. SSLV is made keeping low cost,
low turnaround time in mind with launch-on-demand flexibility under minimal infrastructure
requirements. new launch rocket of ISRO.
 Need:
o Launch of small satellites into low earth orbits (LEO) has become significant in recent years because
of need of small satellites by developing countries, private corporations, universities.
o About 15 to 20 SSLVs would be required every year to meet India’s demand alone.
o Launch of small satellites has until now been dependent on ‘piggy-back’ rides with big satellite
launches on ISRO’s PSLV.
 Significance:
o Low cost, with low turn-around time, flexibility in accommodating multiple satellites, launch on-
demand feasibility, minimal launch infrastructure requirements, etc. It is best suited for launching
multiple micro-satellites at one time. It will support multiple orbital drop-offs.
 Fact:
o NSIL will mass-produce and manufacture SSLV and more powerful PSLV in partnership with private
sector in India through technology transfers.
• Reusable Launch Vehicle-Technology Demonstrator (RLV-TD):
• Next-Gen Launch Vehicle (NGLV):
 In 2022, ISRO Chairman S. Somanath said ISRO was developing a Next-Gen Launch Vehicle (NGLV),
which will one day replace operational systems like PSLV.
 Feature:
o 3 Stage, reusable heavy lift vehicle. Use semi-cryogenic propulsion for booster stages. 10-tonne
payload capability to GTO. Cost efficient. Simple, robust design allowing bulk manufacturing.
 Potential uses:
o Launching communication. Deep space missions. Future human space flight and cargo missions.
ISRO is intending to develop a business model for NGLV to launch commercial as well as national.

PSLV GSLV
Low-Earth Orbit (LEO) satellites into polar orbits Heavier INSAT class of geosynchronous satellites
and sun synchronous orbits (SSO) (GSO) into GSO / GEO orbit.
But, versatile by launching geosynchronous (GSO), uses indigenously developed cryogenicengines.
lunar and interplanetary spacecraft also.
Note:

Page 585 of 719

  NewSpace India Limited (NSIL) [2019]:
→ commercial arm of ISRO and one PSU of Government of India, set up by Department of Space, and under
Department of Space (DoS) itself. estd. under Company Act 2013. for commercial tie -ups with global space
market and manage technology transfer from ISRO to Indian industries.
→ Objective: To scale up industry participation in Indian space programmes.
→ It has responsibility to build, launch, own & operate satellites and provide services to its committed customer.
 ISTRAC:
→ Isro’s Telemetry Tracking and Command Network
→ comprehensive global network of ground stations to provide Telemetry, Tracking and Command (TTC)
support to satellite and launch vehicle missions. These facilities are grouped under ISRO Telemetry,
Tracking and Command Network (ISTRAC)
→ established by ISRO
→ located in Bengaluru

Radar imaging Optical instrument
unaffected by weather, cloud, fog, lack of sunlight
produces high-quality images in all conditions and at
all times
 Indian National Space Promotion and Authorization Center (IN-SPACe):
→ It is one nodal agency appointed by Department of Space, which can authorize non -government entity to
use ISRO’s infrastructure and resources, including ISRO’s launch facilities.
 Launch Vehicle Mark-3 (LVM 3):
→ What:
 It was previously referred to as the Geosynchronous Satellite Launch Vehicle Mark III (GSLV Mk3). It is
a 3-stage medium-lift launch vehicle developed by ISRO. Primarily designed to launch communication
satellites into geostationary orbit, it is also due to launch crewed missions under the Indian Human
Spaceflight Programme [2007].
ISRO changed the name of GSLV Mk3 to LVM 3 in 2022 after the successful launch of LVM3-
M2 mission in 2022. The rename was done to remove any ambiguity on the ability of the vehi cle to
put payloads in a particular orbit.
→ Feature:
 LVM3 is ISRO's heaviest rocket.
 It is 43.5 metre long.
 It weighs around 644 tonne.
 GSLV Mk III has a higher payload capacity than its predecessor, GSLV Mk II.
 It is capable of launching a 4-tonne class of satellites into a GTO.
 It can carry satellites up to 8,000 kg into LEO.
 It is a 3-stage vehicle with 2 solid motor strap-ons, 1 liquid propellant core stage and 1 cryogenic stage.
 OneWeb [2012]:
→ It is legally called Network Access Associates Ltd. It is a communications company that aims to build
broadband satellite Internet services. The company is headquartered in London. The company was
formerly known as WorldVu Satellites Ltd. OneWeb company is a global communications company working
to deliver broadband satellite internet services worldwide, and launches satellites.
As of 2021, Indian multinational company Bharti Global, France-based satellite service provider
Eutelsat and the Government of the UK were the company's largest shareholders.
OneWeb primarily has satellites in low earth orbit (LEO).
Value Addition:
 Anti-satellite weapons (ASAT):
→ space weapons designed to incapacitate or destroy satellites for strategic or tacticalpurposes.
→ Many nations possess operational ASAT systems.
→ No ASAT system has yet been utilised in warfare
→ Some countries - China, India, Russia, United States - successfully shot down their own satellites to
demonstrate their ASAT capabilities.
→ ASATs have also been used to remove decommissioned satellites.
→ India:
 Mission Shakti [2019]:
• joint programme of DRDO, ISRO.
• entire effort is indigenous
• As part of Mission Shakti, one anti-satellite (A-SAT) weapon was launched and targeted one
decommissioned Indian satellite.
• Significance:

Page 586 of 719

  India is only 4th country to acquire such specialised and modern capability
 Only US, Russia, China, India have ASAT capability to hit live target in space.
Question:
 PSLVs launch satellites useful for Earth resources monitoring whereas GSLVs are designed mainly to launch
communication satellites. Satellites launched by GSLV, not by PSLV appear to remain permanently fixed in the same
position in the sky due to their geosynchronous nature. GSLV Mk lll is a 3 staged launch vehicle with two 2 solid strap on
motors, 1 liquid core stage and a high thrust cryogenic upper stage.
Mains Link:
 Highlight some of the future planned missions of ISRO, along with its usefulness, that will help harness space technology
for national development. (15M)

TAX
News:
 2021:
→ Share of cess and surcharge in Gross Tax Revenue (GTR) of Centre increased in 2020-21, leading to 15th Finance
Commission (FC) recommending:
 higher grant-in-aid;
 lower tax devolution,
to States.
→ Centre ordered State welfare boards for building and other construction workers (BOCW) not to distribute household
and other articles to workers and instead to transfer monetary assistance into their bank accounts.
→ Union government appoints interim chief of CBDT.
→ Government introduced Taxation Laws (Amendment) Bill, 2021 in Lok Sabha. [to stop retrospectiv e tax]
→ Centre accepts Cairn’s offer on retrospective tax. Thus, centre govt. will now issue tax refunds to Cairn.
This may end said retrospective tax dispute. [India’s above amendment to taxation laws nullifies tax
originally levied against Cairn in 2016. This amendment allows refund of tax which was collected from
Cairn.]
→ Cairn Energy withdraws lawsuits filed against Indian government and its entities overseas.
→ Seychelles’ Tax Inspectors Without Borders (TIWB) programme launched in partnership with India:
 This programme is 6th TIWB programme that India has supported by providing Tax Expert.
 India in collaboration with UNDP and TIWB Secretariat aims to aid Seychelles in strengthening its tax
administration by transferring technical know-how and skills to its tax auditors, and through sharing of best audit
practices.
 2022:
→ Delhi government introduced “New Delhi Excise Policy 2021-22” in 2021, in order to ensure complete withdrawal of
Delhi government from liquor business and handing over licences to private sector. Until this policy was introduced,
liquor business in Delhi was state-controlled entity with no private players. Now, there is controversy over this Delhi
Liquor Policy.
→ GOI slaps windfall tax on domestic crude oil producers, imposing export duties on petrol, diesel and
Aviation Turbine Fuel (ATF), and hikes import duty on gold in efforts to reduce pressure on Indian rupee,
to rein in CAD, and to increase domestic supply of petroleum products. [ Domestic producers sell crude oil to
domestic refineries at international parity prices which is higher, thus making windfall gains. Example, ONGC
reported bumper profits in 2022 when international prices soared to near 14-year high due to 2022 Ukraine war].
→ FM Nirmala Sitharaman defends windfall tax imposed by Centre on domestic crude oil producers, saying
that it was not one ad hoc move but was done after full consultation with industry. [Central government
had introduced one windfall profit tax on domestic crude oil production]. This windfall tax is one way to
rein in “phenomenal profits” made by some oil refiners in India who chose to export fuel to reap benefits
of skyrocketing global prices while affecting domestic supplies. [Example - Domestic producers, such as
ONGC who reported bumper profits, sell crude oil to domestic refineries at international parity prices, thus
making windfall gains]. [Also, UN chief Antonio Guterres had urged all governments to tax these excessive
profits and use those funds to support most vulnerable people through thes e difficult times meaning
caused by 2022 Ukraine war].
→ Under the faceless tax regime i.e. Faceless Assessment Scheme i.e. E-assessment Scheme, 2019,
information about high-value transactions of taxpayers is received by the tax department which is then
used to issue notices under section 148 Income Tax Act, 1961. Recently, 1000s of such notices were issued
and taxpayers had to pay tax, interest and penalty.
About:
 What:
→ A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or
legal entity) by a governmental organization in order to fund government spending and various public
expenditures (regional, local, or national).

Page 587 of 719

 → Taxes are mandatory contributions levied on individuals or corporations by a government entity —whether
local, regional, or national. Tax revenues finance government activities, including public works and services
such as roads and schools, or programs such as Social Security and Medicare.
In economics, taxes fall on whoever pays the burden of the tax, whether this is the entity being taxed,
such as a business, or the end consumers of the business’s goods.
 History:
→ The 1 st known taxation took place in Ancient Egypt around 3000–2800 BC.
 Direct Tax:
→ Direct tax is paid directly by the individual or entity to the Central / State government.
→ Example – Income tax, Corporation tax, Capital Gains Tax, Profession tax, Property tax, road tax, stamp
duty.
 Indirect Tax:
→ Indirect tax is paid by one individual / entity to government and subsequently the tax burden is passed on
to a different individual / entity.
→ Example – GST, VAT, Customs duty, Excise duty, Securities Transaction Tax, Dividend Distribution Tax, Sales
Tax.
 Tax compliance:
→ Tax compliance refers to policy actions and individual behaviour aimed at ensuring that taxpayers are
paying the right amount of tax at the right time and securing the correct tax allowances and tax reliefs.
 Sovereign right to taxation:
→ What:
 In India, Indian Constitution gives government right to levy taxes on individuals and organisations.
 But, Constitution makes it clear that no one has right to levy or charge taxes except by authority of law.
 Any tax being charged has to be backed by law passed by legislature.
 Retrospective Taxation:
→ What:
 It allows country to pass rule on taxing certain products, items or services or deals and charge companies from
time behind date on which law is passed.
→ India:
 retrospective tax law was introduced through Finance Act, 2012 after Vodafone won case in Supreme Court
against IT department’s demand of tax dues.
 Retrospective tax law became necessary after Supreme Court ruled in 2012 that gains arising from indirect
transfer of Indian assets were not taxable under existing laws.
 Retrospective tax was also applied to Cairn and demanded tax dues from Cairn, when it was exiting from Cairn
India Ltd in 2014.
→ Arguments:

{for} {against}
to correct any anomalies in their taxation hurts companies that had knowingly or
policies that have, in past, allowed companies to unknowingly interpreted tax rules differently.
take advantage of such loopholes.
→ Benefit of scrapping retrospective tax:
 clear and predictable taxation law and intent is presented to companies [which are expected to structure their
assets accordingly].
 clarity for deals between companies of countries where these are not covered under any tax treaty benefits.
 Companies will gain by withdrawing litigation, arbitration
 refund of any taxes to companies.
 Cess:
→ What:
 form of tax levied / collected by government for development / welfare of particular service / sector.
 charged over and above direct or indirect taxes.
→ Feature:
 Cess is levied on tax payable and not on taxable income. [i.e. for taxpayer, cess is equivalent to surcharge on tax]
 Cess collected for particular purpose cannot be used for / diverted to other purposes.
 not permanent source of revenue for government i.e. meant to raise revenue for temporary need.
 discontinued when purpose levying is fulfilled.
 Currently, cess collected by Centre are not part of tax devolution.
 may initially go to CFI but should be transferred to designated reserve funds meant for that particular service.
→ Examples:
 Education Cess, Swachh Bharat Cess, Krishi Kalyan Cess.
 Surcharge:
Page 588 of 719
 → additional charge / tax levied on existing tax.
→ usually permanent in nature.
→ Mechanism:
 Surcharge is levied as % on income tax payable.
 If no tax is due for financial year, then no surcharge is levied.
→ Surcharge revenue earned is solely retained by Centre and is not shared with States.
→ goes into CFI.
→ Currently, cess and surcharge collected by Centre are not part of tax devolution.
 Tax vs Surcharge vs Cess:
→
{Tax} {Surcharge} {Cess}
additional charge / tax levied on charged over and above existing
existing tax tax.
usually permanent in nature. Temporary in nature
All taxes go to CFI. All surcharges go to CFI. may initially go to CFI but should be
transferred to designated reserve
funds.
Can be used by govt. for any has to be used for purpose, for
purpose. which it was collected.
If cess collected in particular year
goes unspent, it cannot be allocated
for other purposes. Instead, amount
gets carried over to next year and
shall only be used for purpose /
cause it was meant for.
 Excise Duty:
→ What:
 Excise Duty is type of tax charged on goods produced within India. Excise duty is one form of indirect tax that is
levied by GOI for production, sale, or license of certain goods. Excise duty charges are also collected by State
governments for alcohol, and narcotics. Excise duty is one kind of indirect tax charged on sale of certain products.
Customer does not pay excise duty directly to authorities, but it is added to cost of product by producer or
merchant and then passed on to consumer by way of increased prices. Excise Duty Act, 1944 governs regulations
related to excise duty in India and this tax is administered by Central Board of Excise and Customs.
 Excise or excise tax (sometimes called excise duty) is type of tax charged on goods produced within India (as
opposed to customs duties, charged on goods from outside India). It is tax on production or sale of good.
→ How is excise duty levied and collected?
 Excise duty is indirect tax levied by government on goods manufactured within India. Excise duty tax amount is
included in final selling price of item. As excise duty is tax on manufacture of goods, goods do not have to be
sold for excise duty to be collected.
→ Who levies excise duty on liquor?
 Excise duty on liquor is levied by respective State governments in India. State excise duty on alcohol is 2nd or 3rd
largest contributor to own tax revenue of States. It accounts for 10-15% of tax receipts for majority of States.
Licences to sell alcohol, fines and confiscation of alcoholic products also add to exchequer of States.
→ Status:
 Excise duty has been replaced by GST.
 Windfall Tax:
→ What:
 Windfall tax is one higher tax rate on profits that result from sudden windfall gain to particular
company or industry, often as result of geo -political disturbance, war or natural disaster that creates
unusual spikes in demand and / or interruptions to supply.
 It is higher tax rate on sudden big profits levied on particular company or industry.
 US Congressional Research Service (CRS) defines windfall tax as one unearned, unanticipated gain in
income through no additional effort or expense.
→ History:
 Historically, taxes on windfall profits have been imposed as result of opportunistic 'price gouging' or
'profiteering', whether real or perceived. Notable instances of sudden and dramatic increases in oil
industry profits that provoked such taxes around world include 1970's OPEC oil embargo, Persian Gulf
wars and 2022 global economic sanctions imposed on Russia in response to its invasion of Ukraine.
→ Countries:
 In 2022, besides India, UK, Italy, Germany have either already imposed windfall profit tax or are
contemplating doing so. Countries are levying windfall taxes now because prices of oil, gas, and coal

Page 589 of 719

 have seen sharp increases. Rising prices meant huge and record profits for energy companies while
resulting in hefty gas and electricity bills for household bills in major and smaller economies.
 Income Tax:
→ Income Tax Act:
 The 1 st Income Tax Act was introduced in India in 1860 by Sir James Wilson. The 1 st post Independence
IT Act was passed in 1961.
 Rationalization of tax:
→ Example:
 E-assessment Scheme, 2019 in case of direct taxes.
 GST in case of indirect taxes.
 Initiative:
→ The Income-tax Act, 1961.
→ GST.
→ E-assessment Scheme, 2019.
Note:
 The Income-tax Act, 1961:
→ It is the charging statute of Income Tax in India. It provides for levy, administration, collection and recovery of Income
Tax. Though it has witnessed several amendments, it can be said that no amendment in the tax laws brought an end
to the corruption within the tax department until the Narendra Modi government came to power and introduced
the faceless tax regime.
 Central Board of Direct Taxes (CBDT) [1963]:
→ What:
 statutory body
 established under Central Board of Revenue Act, 1963.
 India’s official FATF unit.
 administered by Department of Revenue, Ministry of Finance.
 Tax Inspectors Without Borders (TIWB) Programme:
→ What:
 joint initiative of UNDP; and OECD.
→ Objective:
 to enable sharing of tax audit knowledge and skills with tax administrations in developing countries.
→ How:
 through targeted, real time “learning by doing” approach.
→ Focus:
 promoting hands-on assistance by sending Experts to build audit and audit-related skills pertaining to specific
international tax matters
 development of general audit skills within developing tax administrations.
 E-assessment Scheme, 2019:
→ What:
 It is a faceless tax regime scheme i.e. Faceless Assessment Scheme of Income Tax Department, Min. of
Finance, GOI notified in 2019 by Min. of Finance in exercise of powers conferred on it by Income Tax
Act, 1961.
 It is the faceless regime for direct taxes. The scheme lays down the procedure to carry out a faceless
assessment through electronic mode.
→ Objective:
 Promoting an efficient and effective tax administration, minimizing physical interface, increasing
accountability and introducing team-based assessments.
→ Focus area:
 Faceless Assessment Scheme focuses on:
• No human interface; Eased compliance for taxpayers; Efficiency and transparency; Quality of
assessment improved; Fast-tracking of disposal of disputes and cases; Specialization in
functionality.
→ Features:
 National E-Assessment Center (NEAC) will be acting as a nodal agency and a single point of contact
and facilitator of all interaction between the taxpayer and the Income -tax authorities.
 Regional E-Assessment Centers (REAC): Assessment proceedings will be carried out by REAC agency
with support from various units such as the Assessment Unit, Verification Unit, Technical Unit, Review
Unit.
 All written submissions to the income tax authorities will happen through virtual and digital means.
 Proceedings before the Dispute Resolution Panel (DRP) would also become faceless as provisioned by
this faceless assessment scheme.
Page 590 of 719
  Under this scheme, personal appearances for hearing are prohibited or not required.
 The tax authorities lay down standards, procedures, and processes, with approval from CBDT.
→ Significance:
 The faceless Assessment Scheme is one of the biggest Direct Tax reforms in India. It is based on
principles of efficiency, transparency, and accountability.
 Under this faceless tax regime, information about high-value transactions of taxpayers is received by
the tax department which is then used to issue notices under section 148 (Issue of notice where
income has escaped assessment) of Income Tax Act, 1961. In 2022, 1000s of such notices were issued
and taxpayers had to pay tax, interest and penalty.
 Though IT Act, 1961 has witnessed several amendments, it can be said that no amendment in the tax laws
brought an end to the corruption within the tax department until the Narendra Modi government came to power
and introduced the faceless tax regime.
 This faceless tax assessment system has put everything online — from the filing of returns to the assessment
orders. It has even done away with the need for huge storage facilities for the records of taxpayers. [The only 2
departments in Income Tax department, Min. of Finance that are required to physically interact with taxpayers
are the investigation wing and international taxation].
→ Achievement:
 Earlier before introduction of this faceless tax regime, corruption in the tax department, which used to be a
major cause of concern for every taxpayer who suffered at the hands of dishonest tax officials, was prevalent.
But now because of this faceless tax regime, corruption in the tax department has decreased significantly.
 Because of it, tax compliance has increased.
 Now because of this scheme, there is no personal interaction with tax officers and thus has significantly reduced
instances of harassment.
 Under this faceless tax regime, information about high-value transactions of taxpayers is received by
the tax department which is then used to issue notices under section 148 (Issue of notice where
income has escaped assessment) of Income Tax Act, 1961. In 2022, 1000s of such notices were issued
and taxpayers had to pay tax, interest and penalty. This is set to enhance tax compliance as taxpayers will
know that it is not possible to hide high-value transactions and they should disclose such transactions while filing
their returns.
 An important aspect of the faceless tax regime is that even the 1st appellate authority — the Commissioner of
Income-Tax appeal (CIT appeal) — is now faceless, leaving no room for corruption. In the past, dishonest
taxpayers allegedly used to manage appellate orders during the CIT appeal.
→ Way Forward:
 In international taxation, non-residents (NRI) are required to approach the international taxation department of
Income Tax Dept., Min. of Finance for tax clearance on the sale of property. The procedure remains
cumbersome, with individuals required to submit a long list of documents. This area needs to be addressed and
GOI should take steps to reduce the harassment of NRI taxpayers.
 Taxation Laws (Amendment) Bill, 2021:
→ Aim:
 Amends Income Tax Act, 1961, Finance Act, 2012.
 Prevents income tax department from raising tax demands retrospectively.
→ Implications:
 No tax demand shall be raised in future on basis of retrospective amendment for any indirect transfer of Indian
assets.
 Refund be paid out.
→ Eligibility:
 To be eligible, concerned taxpayers must drop all pending cases against government and promise not to make
any demands for damages or costs.
→ Significance:
 to end long-pending disputes with foreign firms - Vodafone Plc. etc.
 investor-friendly
 to end messy litigation and arbitration – Cairn [Cairn company claiming India’s overseas assets].
Value Addition:
 Better Life Index:
→ developed by OECD
→ compare well-being across countries, based on essential topics - material living conditions, quality of life
→ It says there is more to life than numbers of GDP and economic statistics.
 Income Tax Appellate Tribunal (ITAT) [1941]:
→ known as ‘Mother Tribunal’.
→ statutory body
→ deals with income tax matters.

Page 591 of 719

 → functions under Department of Legal Affairs, Ministry of Law and Justice. It is kept away from any kind of control by
Ministry of Finance [to ensure highest degree of independence].
→ its orders are final. But, its orders can be appealed, on substantial questions of law, before High Court.
→ Note:
 e-dwar:
• e-filing portal of Income Tax Appellate Tribunal (ITAT)
 Sovereignty:
→ Act of sovereign power is one which cannot be prevented or declared invalid by any other power
recognised by Constitution of state.
 Marginal Tax rate:
→ tax rate one pays on additional income.
→ progressive taxation
→ to tax individuals based upon their earnings [low-income earners taxed at lower rate and higher-income
earners taxed higher].
 Flat Tax:
→ taxation system in which government taxes all income at same % regardless of earnings.
→ There are no special deductions or credits. Rather, each person pays set % on all income. Thus, it is
regressive tax.
→ lower-income people pay effectively same rate as higher-income earners.
→ same tax rate is applied to every taxpayer regardless of their income bracket.
Mains Link:
 Discuss the issues associated with retrospective taxation in India.
 What are Cess and Surcharge? Why they are imposed? Discuss their significance.
 What is Cess? How is it different from a surcharge? Discuss.

ECONOMY [specific]
News:
 2022:
→ India surpasses UK to become 5 th largest economy in World. According to Bloomberg Report, India
outpaced England during 2021.
→ According to one paper by Exim Bank of India, India's creative economy comprising arts and crafts, audio
and video arts and design among others accounted for exports of goods and services worth USD 121 billion
in 2019. This research paper mapped untapped export potential of India's creative economy.
→ Fitch Ratings forecasts its India’s economic growth (GDP) for FY 2022-23 to 7% due to global economic
slowdown, elevated inflation, tighter monetary policy. This global ratings agency expects Indian economy
to grow 6.7% in FY 2023-24, due to European gas crisis, high inflation, sharp acceleration in pace of global
monetary policy tightening.
→ S&P (global rating agency) says India is not so coupled with global economy, and so recession is unlikely in
India. It says even though USA and Euro zone are headed to recession, India is unlikely to face impact given
"not so coupled" nature of its economy with global economy. S&P says Indian economy is lot decoupled
from global economy than we normally think of, given its lar ge domestic demand, even though India is net
importer of energy. But because India has enough forex reserves on one hand and India’s companies have
managed to maintain healthy balance sheets. S&P further says in fact, India was never coupled fully with
global economy and so is relatively independent of global markets.
→ IMF publishes 2 nd World Economic Outlook in year 2022. The central message of IMF’s World Economic
Outlook is that 'the worst is yet to come'. India has cause for concern.
→ Many economists warn that Europe may be headed for a Doom loop.
→ An IMF official (Anne-Marie Gulde) says with downgrades in growth forecasts from June 2022, and a slowdown
predicted in 2023, a growth rate of FY23-24 of 6.1% for India is “still a bright spot”.
→ As per an RBI paper released in 2022 (RBI October Bulletin), India’s “green gross domestic product" has turned a
corner in the 21st century by growing faster than traditional GDP as India took measures to cut carbon emissions,
improve resource use efficiency and boost clean energy capacity.
About:
 Status of Indian economy:
→ India has mixed economy. Half of workers rely on agriculture. Cost of living is lower than in USA. Indian middle class
is bigger than USA middle class. India is attractive country for outsourcing, such as call centers. Bollywood contributes
billions to India’s GDP.
→ In 2022, an IMF official (Anne-Marie Gulde) said with downgrades in growth forecasts from June 2022, and a
slowdown predicted in 2023, a growth rate of FY23-24 of 6.1% for India was “still a bright spot”. At the relevant time
in 2022, Indian economy was facing a mix of cyclical and structural challenges:

Page 592 of 719

  Cyclical challenges: Slow-down in private consumption (it contributes 60% in GDP); declining rural and urban
wages; decline in savings (from 32% in 2011 to 29% in 2019-20); decline in gross fixed capital formation (from
34% in 2011 to 30% in 2019-20); high NPAs in the banking sector (nearly 7% in 2022).
 Structural challenges: Sluggish agricultural sector growth (around 3%); Suboptimal skill of Human Resources
(only 5% of our workforce is formally trained); 4 labour codes have still not been implemented uniformly; and
transitional effects of big-ticket reforms – demonetization, GST.
 Indian economy integration into world economy:
→ Indian economy is not fully integrated into world economy due to partial capital account convertibility, managed
currency rate, and trade restrictions.
 Advantages of Indian Economy:
→ Large domestic demand. Enough forex reserves. Healthy fiscal balance sheets of Indian companies.
 Economic Growth:
→ Economic Growth can be defined as increase or improvement in inflation -adjusted market value of goods
and services produced by economy over certain period of time. Statisticians conventionally measure such
growth as the percent rate of increase in the real GDP.
 Liberalization / Liberalisation:
→ It is one broad term that refers to practice of making laws, systems, or opinions less severe, usually in
sense of eliminating certain government regulations or restrictions. Term is used most often in relation to
economics, where it refers to economic liberalization, removal or reduction of restrictions placed upon
economic activity.
→ Economic liberalization / Economic liberalization:
 What:
• It is lessening of government regulations and restrictions in economy in exchange for greater
participation by private entities. In short it is removal of controls to encourage economic
development. It means loosening of government controls.
 Issue:
• No doubt we need more capital and better integration with world markets. But IMF -WB holy trinity
of structural land, labour and other market-opening reforms harms many domestic citizens and,
beyond point, runs into severe resistance that imposes large political costs. Now by 2022,
Liberalisation has reached point of diminishing returns.
• Recently in 2022, some experts suggested liberalization situations such as:
 Privatisation of banks - However, with improvements in PSB governance and risk-based lending profiles,
NPA ratios have fallen and therefore no need for privatization.
 Rupee should be completely market-determined - However, fall in exchange rate of rupee from about
Rs. 8 in 1990s to about Rs. 80 currently in 2022 has not brought about sustained rise in exports. And
therefore argument that Rupee should be completely market-determined is not fully justified.
 Way Forward:
• Focus on digital aspects, where India has comparative advant age. Supply chain diversification
away from China. Moving to net-zero economy and harnessing green initiatives as source of
investment and innovation. Developing skills and capabilities. Improving employability.
Augmenting infrastructure. Reducing logistics and other business costs through better Centre-
State coordination. Enhancing quality of governance. Improve data use and privacy, functioning of
courts and police.
 Creative economy:
→ What:
 John Howkins popularized term “creative economy” in 2001, and mean t arts, cultural goods and
services, toys and games, research and development.
→ Status:
 India ranks 6 th globally with respect to top international box office markets by revenue.
 According to one paper in 2022 by Exim Bank of India, India's creative economy comprising arts and
crafts, audio and video arts and design among others accounted for exports of goods and services
worth USD 121 billion in 2019. This research paper mapped untapped export potential of India's
creative economy.
→ Way Forward for sustained ‘Creative Economy’:
 Defining and mapping creative industries in India. Funds to finance creative industries. Focusing on
joint programmes. Addressing issue of copyrights. Promoting MSMEs and local artisans. Establishing
creative districts and hubs. Forming specialized institution for creative industries. Several countries
such as Australia, France made dedicated institutions or ministries for ‘Creative Economy’.
 Gross Domestic Product (GDP):
→ Nominal GDP includes inflation.
→ Real GDP does not count for inflation.
→ Current prices are those indicated at given moment in time, and said to be in nominal value.
Page 593 of 719
 → Constant prices are in real value, i.e. corrected for changes in prices in relation to baseline or reference
datum.
→ Criticism:
 A common criticism of GDP calculation is that it ignores cost of degradation of environment and, so,
is short-sighted in its approach.
 Green Gross Domestic Product / Green GDP / GGDP:
→ What:
 It is an index of economic growth with the environmental consequences of that growth factored into a country's
conventional GDP. Green GDP monetizes the loss of biodiversity, and accounts for costs caused by climate
change. Some environmental experts prefer physical indicators (such as "waste per capita" or "carbon dioxide
emissions per year").
 Green GDP adjusts the conventionally calculated GDP for the environmental costs of economic growth.
 Green GDP is a term used generally for expressing GDP after adjusting for environmental damage. This concept
was introduced by China by publishing its 1st green GDP data for the year 2004 in 2006.
 Green GDP is a monetization of the loss of biodiversity caused by climate change. It is calculated by subtracting
resource depletion, and environmental degradation from the traditional GDP figure.
→ Background:
 UN 1st proposed the idea of green GDP in 1993. However, it failed to catch on as countries such as US, China,
Norway, Australia and Canada, which flirted with the idea, were spooked by the fact that the ‘environmentally-
adjusted’ GDP numbers were far lower than the conventional GDP figures. This was because the formula only
focused on deducting the cost of the depletion of natural resources.
Therefore, more recently, the statistical arm of the UN has been experimenting with a new kind of
green GDP — one that includes both the positives (such as measures to protect the environment) and the
negatives.
→ Feature:
 Green GDP is < GDP if economic growth is not eco-friendly.
→ India:
 Calculation:
• The green GDP formula starts with annual GDP at 2015 prices, from which it subtracts various damage costs
to the environment each year while adding the expenditure by the government on environmental
protection.
 India’s GDP growth has made switch to eco-friendly path. As per an RBI paper released in 2022, India’s “green
gross domestic product" has turned a corner in the 21st century by growing faster than traditional GDP as India
took measures to cut carbon emissions, improve resource use efficiency and boost clean energy capacity.
 According to Mint newspaper, calculated based on RBI October Bulletin 2022 (written by RBI staffs and does not
reflect RBI’s views), from 1970s to 1990s, growth rate of India’s traditional GDP was > Green GDP growth rate,
implying that the growth in this period was more damaging to the environment. However, from 2000s to 2010s,
Green GDP growth rate was > traditional GDP growth rate. That is, while traditional GDP accelerated at an annual
average pace of 6.27% and 6.61% in the 2000s and 2010s, the “green GDP" rose 6.34% and 6.71%, respectively.
Green GDP was around 6% lower in 2019. At the turn of the millennium, it was lower by around 8%. A
smaller deficit now means India has been able to cut down on environmental losses.
However, a finer look shows that green growth slowed in the years before the Covid pandemic as the
normal GDP growth also slowed. Green GDP peaked at 8.51% in 2016 and dropped to 3.99% in 2019.
India’s trajectory of green GDP has displayed an upward movement with visible improvements,
particularly since 2012.
In the years after independence, as India focused on gaining an economic foothold, GDP growth often
came at the cost of environmental damage. This is reflected in the green-GDP to conventional-GDP ratio’s
downward trend through the 1970s, 1980s and 1990s.
→ Significance:
 Since 2009, India’s green GDP ratio (green-GDP to conventional-GDP ratio) has mostly seen an upward trend,
indicating a greater emphasis on maintaining a healthier balance between India’s growth aspirations and
environmental protection.
 Green GDP is very helpful for managing economies as well as resources.
 Green GDP is an indicator of not only how a country is prepared for sustainable economic development but also
the Waste Per Capita or Carbon Dioxide emissions growth / decline.
→ Way Forward:
 RBI October Bulletin 2022 (though written by RBI staffs and does not reflect RBI’s views) suggested that a
dedicated in-house group be formed in the Ministry of Environment, Forest and Climate Change to provide data
(such as measures taken to protect the environment) periodically.
 India’s economy at 75 years of Independence:

Page 594 of 719

 → Background: At time of Independence, newborn nation was highly impoverished, thanks to centuries of colonial
exploitation. It was critically dependent on foreign aid for food and forex and had average life expectancy of only 32
years. Level of illiteracy was very high.
→ Status:
 3rd largest economy (PPP): India is today 3rd largest economy in terms of purchasing power parity, and in terms
of nominal exchange rate of dollar, India is 6th largest economy.
 Growth rate: It has grown at average rate of 7% per annum for past 40 years, growing from size of USD 189
billion in 1980 to nearly USD 3 trillion today. This growth rate is about 2% lower than that of China over same
period but represents higher rate of return when compared with investment rate of GDP.
 Foreign exchange: It holds 5th largest stock of foreign exchange and is net lender to IMF, far cry from having to
go with begging bowl to IMF on brink of forex bankruptcy in 1991.
 Extreme Poverty: Level of extreme poverty is down sharply from nearly 50% to possibly single digit, and life
expectancy has more than doubled since 1947.
 BOP surplus: India is rare Asian country with persistent CAD, as imports always exceed exports. And yet, foreign
investors pour investment, leading to consistent balance of payment currency surplus for India.
 Strong fundamentals of economy: Foreign investor is confident that even with twin deficits (fiscal and external),
growth of India’s economy, driven by demography and dynamism, can pay for these deficits.
 Strong democracy: India’s robust democracy stands in sharp contrast to authoritarian regime of China. Many
large countries such as USSR broke up into smaller splinters meanwhile. India has witnessed largely bloodless
and peaceful transfer of power — 16 times — something that other former colonial, developing countries can
only envy.
 High exports: India’s trade to GDP ratio, one indicator of its openness is higher than USA. India is now one of
world’s leading exporters of software and one outsourcing powerhouse.
 High remittances: Indian workers send nearly 100 billion dollars of inbound remittance, which strengthens Indian
economy. In indirect way, it is like India’s labour export income.
 Proliferation of unicorns (valued highly by equity investors), exponential growth of e-commerce and digital
payments, and widening industrial base.
 Consistent growth in agriculture.
→ Challenges:
 Unemployment remains huge challenge, as youth still scramble for government jobs. Government disclosed in
Parliament in 2022 that 220 million Indians had applied for just 7 lakh government jobs in past 7 years.
 Labour force participation rate is low, alarmingly so for women. Job creation is priority number one, even as
nearly 70% of industrial jobs are vulnerable to becoming extinct, because of automation, robotics.
 High level of hunger: Despite PDS, India’s ranking in Global Hunger Index is low, signifying lopsided distribution
of economic growth.
 Inequality in income, wealth, and access to quality education and health facilities is widening.
 India was late to adopt free market economy: India was more inward-looking and influenced, by Soviet planning
model of development. One could argue that it should have been abandoned much earlier than when we
actually did. But it did pay dividends in terms of infrastructure and green revolution. It just stayed longer than it
needed to.
 Late on capitalizing on export-led growth: India also missed bus, unlike her East Asian neighbours, on capitalising
on labour-intensive export-led growth. But after shock of 1991, Indian economy opened up dramatically.
→ Conclusion:
 To generate 10 million jobs annually, we need lakhs of new enterprises to be born. That calls for ease of doing
business, especially in areas such as dispute resolution and contract enforcement. Judicial reform is as urgent as
job creation. India is fastest-growing large economy, proud of its democratic foundations, but much work
remains to be done.
 Challenges to India’s growth and sustainability:
→ Rising inequality. Low labour force participation (esp. for women). Growth has not matched job creation
(jobless growth). Rising geopolitical and climate change issues.
 Global Economy / World Economy:

 Way Forward:
→ In 2022, IMF suggested that India should choose fiscal policy, monetary policy carefully to support ‘bright
spot’ growth forecast. IMF further suggested some reforms to India, such as:
 Restrain high level of debt and provide government fiscal support in a targeted and time-bound manner.
 Follow tight monetary policy.
 Implement structural reforms. E.g. manufacturing sector reforms, doing away with labour market rigidities etc.
→ “Competitiveness Roadmap for India@100”, released by Economic Advisory Council to Prime Minister (EAC-
PM) in 2022, aims to enable India to become high-income country by 2047 using sector and region-specific
policies based on 4S principle:

Page 595 of 719

  Shared Prosperity: Opportunities should be shared across every section of society;
 Social Prosperity: Economic Growth should match social development;
 Sustainable Prosperity: Eeconomic progress should be environmentally sustainable;
 Solid Prosperity: Economic system should be resilient to shocks.
And its recommended to achieve these 4S principle via:
 Structural Transformation 2.0: Creating new jobs using sector-specific and region-specific initiatives (e.g. PLI for
different sectors, Mega food parks for different regions).
 Convergence of programs and initiatives (including public-private participation).
 Reduce social and institutional barriers for citizens (Eg. reducing discrimination in jobs, increasing safety for
women, ease travelling experiences such as women given free transport in Delhi DTC buses).
 Enable competition in market (e.g. greater competition in e-commerce is profitable for citizens).
→ Reduce inequality between States: In next 20 years, 6 States in South and West India will account for almost
35% of GDP growth but only 5% of population growth because economic complexity breeds higher wages.
→ Reduce inequality between cities: Hyderabad has higher GDP than Odisha and 4 times that of JK.
→ Reduce inequality between different sectors: Software — one oasis of high firm productivity — employs only
8% of our labour force but generates 8% of GDP. While agriculture has 42% of our labour force but only
generates 16% of GDP. China raised its per capita income 80 times in 40 years by moving 700 million people
from farm to non-farm employment.
→ Reduce huge difference between firms: India’s largest and smallest manufa cturing companies have 24 times
difference in productivity. States that replace deals with rules by reducing regulatory cholesterol will attract
high-paying jobs.
→ Increasing Soft skills: Wages are higher for using minds than muscles. States with high popul ations of residents
with skills in demand will attract more high-paying jobs.
→ Empower mayors in relation to devolution of funds, functions, and functionaries.
→ Creating supply that will attract demand (providing skills to workers in advance for manufacturin g boom just
like South India did for software with its 1980s engineering college deregulation).
→ Formalisation: State governments generate more than 75% of India’s 67,000 plus compliances, 6,700 plus
filings, and 26,410 employer criminal provisions.
→ Rational HR in Civil Services like not punishing good performers by promoting bad performers.
→ Digitise: Set one 12-month target for paperless and cashless for all citizen interfaces by leveraging India’s
unique stack of digital public goods.
Note:
 Credit Rating Agency (CRA) / Ratings service:
→ One company that assigns credit ratings, which rate debtor's ability to pay back debt by making timely
principal and interest payments and likelihood of default. This agency may rate creditworthiness of issuers
of debt obligations, of debt instruments, and in some cases, of servicers of underlying debt, but not of
individual consumers.
Rating agencies assess creditworthiness or potential of equity, debt or country. Their reports are read
by investors to make informed decision on whether or not to invest in particular country or companies in
that geography. Lowered rating of country can potentially cause panic selling or offloading of investment
by foreign investor.
3 prominent rating agencies are - S&P Global Ratings, Moody's Investors Service, Fitch Ratings.
 Doom Loop:
→ A doom loop describes a situation in which one -ve action or factor triggers another, which in turn triggers
another -ve action or causes the 1 st -ve factor to worsen, continuing the cycle. It is equival ent to a vicious
cycle in which a downward trend becomes self-reinforcing. The term was popularized in the 2001
management book Good to Great by Jim Collins.
In economics, a doom loop describes a situation in which one -ve economic condition creates a 2 nd -ve
condition, which in turn creates a 3 rd -ve condition or reinforces the 1 st , resulting in a self-reinforcing
downward spiral.
The doom loop is the circle of vulnerability where a country’s banking system can be severely hurt by
volatility in the economy. A country is at risk of a doom loop when a shock to one part of its economic
system is amplified by its effect on another.
 World Economic Outlook:
→ IMF report on world economy. IMF publishes 2 WEOs each year (in April and October) as well as 2 updates
(January and July). WEO is a comprehensive report published twice a year by IMF. It includes IMF's
estimates and forecasts for global output growth and inflation as well as for real GDP growth, consumer
prices, current account balances and unemployment in IMF's 190 member countries, grouped by region
and development status. WEO also includes several chapters on selected pressing economic issues.
It is a survey by IMF. It analyses and predicts global economic developments during the near and
medium term.
→ 2 nd World Economic Outlook report in year 2022:
Page 596 of 719
  Its central message is that the worst is yet to come. India has cause for concern.
 Finding:
• More than a 1/3rd of the global economy will contract in 2022 or in 2023. 3 largest economies —USA, EU,
and China — will continue to stall. Increasing price pressures remain the most immediate threat to current
and future prosperity by squeezing real incomes and undermining macroeconomic stability.
• IMF has sharply cut the forecast for global growth — from 6.0% in 2021 to 3.2% in 2022 and 2.7% in 2023.
[Barring the global financial crisis of 2008 and the sharp fall immediately after the Covid pandemic in 2020,
this is the weakest growth profile for the world since 2001].
 Reason:
• 2022 Russian invasion of Ukraine. Cost-of-living crisis caused by persistent and broadening inflation
pressures. Slowdown in China. [Global inflation is expected to peak at 9.5% in late 2022].
 Impact:
• Overall, 2022’s shocks will re-open economic wounds that were only partially healed post-pandemic. In
short, the worst is yet to come and, for many people, 2023 will feel like a recession.
 On India:
• At 1st glance, India appears better placed. India’s GDP growth rate is better and inflation is not as high. But
these metrics hide that in absolute terms, India is barely out of the contraction suffered in 2020, that it was
home to the most people (5.6 crore, according to World Bank) pushed below poverty in 2020 or that crores
are unemployed.
• The threat to India comes from at least 4 sources:
 higher crude oil and fertiliser prices will spike domestic inflation;
 global slowdown will hurt exports, dragging down domestic growth and worsening the trade deficit;
 strong dollar will put pressure on rupee’s exchange rate, which will likely result in reducing our forex
reserves and reducing our capacity to import goods when the going gets tougher.
 Also, given the low demand among most Indians, GOI might be forced to spend more towards providing
basic relief in the form of food and fertiliser subsidies. This will worsen the government’s financial
health.
 Kuznets curve:
→ What:
 Kuznets curve expresses a hypothesis advanced by economist Simon Kuznets in the 1950s and 1960s. According
to this hypothesis, as an economy develops, market forces 1st increase and then decrease economic inequality.
Kuznets hypothesize that industrializing nations experience a rise and subsequent decline in economic
inequality, characterized as an inverted "U" — the “Kuznets curve”.
→

→ His explanation:
 He thought economic inequality would increase as rural labor migrated to the cities, keeping wages down as
workers competed for jobs. And, according to him, social mobility increases again once a certain level of income
was reached in “modern” industrialized economies, as the welfare state takes hold.
→ Contradiction:
 The Kuznets curve appeared to be consistent with experience at the time it was proposed. However, since the
1960s, inequality has risen in the US and other developed countries. That is, since Kuznets postulated this theory
in the 1970s, income inequality has increased in advanced developed countries — although inequality has
declined in fast-growing East Asian countries.
→ Environmental Kuznets Curve:
 It is a hypothesized relationship between environmental quality and economic development. It says various
indicators of environmental degradation tend to get worse as modern economic growth occurs until average
income reaches a certain point over the course of development.
That is, environmental indicators deteriorate as an economy industrializes until a turning point is
reached. The indicators then begin improving again with the aid of new technology and more money that is
funneled back to society to improve the environment.

Page 597 of 719

  The Environmental Kuznets Curve suggests that economic development initially leads to a deterioration in the
environment, but after a certain level of economic growth, a society begins to improve its relationship with the
environment and levels of environmental degradation reduces.


 Significance:
• From a very simplistic viewpoint, Environmental Kuznets Curve can suggest that economic growth is good
for the environment. Environmental Kuznets Curve suggests, in sum, that "the solution to pollution is
economic growth."
Question:
 With reference to Indian economy after 1991 economic liberalization, in rural areas, growth in non-farm economy
increased. Growth rate in rural employment decreased. After LPG reforms of 1991, it is inevitable that rural / agriculture
workforce would start shifting towards urban / non-Agri sectors. Steady transition to urbanization over years is leading
to decline in rural share of population, workforce and GDP of country.
 Economic growth in country X will occur if there is capital formation in X. Capital Formation is defined as that part of
country’s current output and imports which is not consumed or exported during accounting period but is set aside as
addition to its stock of capital goods. It shows growing economy.
 In India after its liberalization of economic policies in 1991, share of agriculture in GDP decreased, share of India’s exports
in world trade increased, FDI inflows increased, India’s foreign exchange reserves increased enormously.
Mains Link:
 Evaluate the performance of the Indian economy in the last 75years since Indian independence. Has it been able to live
up to the initial expectations? (250 Words).
 “ Economic growth is a precondition for inclusive growth”, Do you agree? Analyse. (250 Words)
 Assess India’s 1991 liberalisation reforms and the lessons it offers in contemporary times. (10M)

COAST
News:
 2021:
→ MoEFCC begins Beach Environment & Aesthetics Management Services (BEAMS) [to pursue Sustainable
Development of coastal regions of India].
 2022:
→ MoES says Bengal coast faces most erosion. 34% of India’s coastline is under erosion. WB has suffered worst (60.5%
of its coast is threatened by erosion).
→ CAG tables audit report on conservation of coastal ecosystems in Parliament.
→ 2 more beaches (Minicoy Thundi beach and Kadmat beach), both in Lakshadweep, have been accorded the ‘Blue
Flag’ tag, putting them in an elite list of the world’s cleanest and most eco-friendly “beaches, marinas and sustainable
boating tourism operators”.

Page 598 of 719

About:
 Coastal Erosion:
→ What:
 Coastal erosion is loss or displacement of land, or long-term removal of sediment and rocks along coastline due
to action of waves, currents, tides, wind-driven water, waterborne ice, or other impacts of storms. process by
which local sea-level rise, strong wave action, and coastal flooding wear down or carry away rocks, soils, and /
or sands along coast. Landward retreat of shoreline can be measured and described over timely scale of tides,
seasons, other short-term cyclic processes. Coastal Erosion is process by which local sea-level rise, strong wave
action, and coastal flooding wear down or carry away rocks, soils, and / or sands along coast.
→ Cause:
 Coastal erosion may be caused by hydraulic action, abrasion, impact and corrosion by wind and water, other
forces, natural or unnatural.
→ 4 Process:
 Corrosion, Abrasion, hydraulic action, attrition.
→ Remedy:
 Coastal erosion structures - Seawalls, revetments, bulkheads, groins, breakwaters - may reduce erosion in short
term. Beach nourishment (reducing depth of sea along shore) is one permanent solution.
 Case study: Under Kerala government’s Coastal conservation project, tetrapod-based seawall has been
implemented in Kerela’s Ernakulam district. Conventional seawall of Chellanam village, Kerala failed to check
sea ingress which resulted in massive ruin and destruction. Now, due to tetrapod-based seawall, stretches that
were most vulnerable to sea erosion have remained by and large safe.
→ Initiative:
 Agency: National Centre for Coastal Research (NCCR) (under MoES) is monitoring India’s shorelines since 1990.
 Integrated Coastal Zone Management Plan (ICZM).
 National Centre for Sustainable Coastal Management (NCSCM): To research areas of CZM including coastal
resources and environment.
 15th FC [recommendation]:
• Create one National Disaster Risk Management Fund (NDRMF) and State Disaster Risk Management Fund
(SDRMF) comprising Mitigation Fund at National and State-levels (NDMF/SDMF). Create Response Fund at
National and State level (NDRF/SDRF). NDMA may develop suitable norms for mitigation measures to
prevent erosion. Both Union and State Governments should develop policy to deal with extensive
displacement of people caused by coastal and river erosion.
 Coastal Vulnerability Index (CVI) map:
• Indian National Centre for Ocean Information Services (INCOIS) prepared and published atlas of Coastal
Vulnerability Index (CVI) maps for entire coastline of India using data on sea level rise, coastal slope,
shoreline change rate, coastal elevation, coastal geomorphology, tidal range, significant wave height.
→ In 2022, Ministry of Earth Sciences said that of 6,907.18 km long Indian coastline of mainland:
 Bengal coast faces most erosion. about 34% is under varying degrees of erosion. 26% of coastline is of
accumulating nature, and remaining 40% is in stable state. West Bengal suffered erosion along its 60.5% of coast
over period from 1990 to 2018. This is followed by Kerala. Tamil Nadu suffered erosion along its 42.7% of coast.
Gujarat, with India’s longest coastline of 1,945.60 km, suffered erosion along its 27.06% of coast. UT Puducherry
suffered erosion in about 56.2% of its coast.
→ Impact:
 Destruction of biodiversity and habitat, loss of fertile land, loss of tourism, etc.
 Coastal areas:
→ Conservation of Coastal areas is governed under Environmental Protection Act, 1986. Coastal Regulation Zone (CRZ)
Notification 2019, classifies coastal area into different zones to manage infrastructure activities and regulate them.
3 institutions responsible for implementation of CRZ are:
 National Coastal Zone Management Authority (NCZMA) at Centre.
 State / Union Territory Coastal Zone Management Authorities (SCZMAs / UTCZMAs) in every coastal State and
Union Territory.
 District Level Committees (DLCs) in every district.
These 3 bodies examine if:
 CRZ clearances granted by government are as per procedure.
 Project developers once given go-ahead are complying with conditions.
 Project development objectives under Integrated Coastal Zone Management (ICZM) Programme are successful.
→ Coastal Zone Regulations:
 CRZ I – Ecologically Sensitive Areas.
 CRZ II – Urban (developed) areas up to shoreline of coast.
 CRZ III – Rural and urban areas which fall outside CRZ I and CRZ II.
 CRZ IV – Aquatic areas up to territorial limits.

Page 599 of 719

Note:
 Blue Flag Certification [1985]:
→ What:
 globally recognised eco-label status / trademark / programme. awarded to beaches / marinas / sustainable
boating tourism operator. awarded by international agency, Foundation for Environment Education
(FEE), Denmark based on 33 stringent criteria.
 It is an elite list of the world’s cleanest and most eco-friendly “beaches, marinas and sustainable boating tourism
operators”.
 It is a certificate awarded by the prestigious international programme of cleanliness and environmental
sustainability run by the global nonprofit Foundation for Environmental Education [1981].
→ Feature:
 Its certification is awarded by an international jury comprising members of UNEP, UN World Tourism
Organisation, and IUCN, besides FEE.
 It was started in France in 1985.
→ Blue Flag beach:
 It is an eco-tourism model. Its features include clean and hygienic bathing water – water quality standards.
Facilities / amenities - waste disposal, disabled- friendly, first aid equipment. safe and healthy environment.
sustainable development of area.
 It is awarded annually.
→ Significance:
 Neat and clean beaches are indicator that coastal environment is in good health. Blue Flag certification is global
recognition of conservation and sustainable development efforts.
 It is regarded as a coveted eco-label.
→ World:
 Spain tops list.
→ India:
 MoEFCC implements it. Chandrabhaga beach of Konark coast in Odisha is India’s 1st. India is in league of 50
“Blue Flag” countries.
 As of 2022, India has 12 such 'blue' beaches:
• Shivrajpur beach (Gujarat), Ghoghla beach (Diu), Kasarkod beach (Karnataka), Padubidri beach (Karnataka),
Kappad beach (Kerala), Rushikonda beach (Andhra Pradesh), Golden beach (Odisha), Radhanagar beach
(Andaman and Nicobar), Kovalam beach (Tamil Nadu), Eden beach (Puducherry), Minicoy Thundi Beach
(Lakshadweep), Kadmat Beach (Lakshadweep).
 Integrated Coastal Zone Management (ICZM):
→ What:
 World Bank assisted project. National Centre for Sustainable Coastal Management (NCSCM), Chennai will
provide scientific and technical inputs. highly praised & flagship program of Ministry of Environment, Forest and
Climate Change (MoEFCC). Integrated Coastal Zone Management ICZM Plan ensures optimum suitable use of
coastal natural resources.
→ Origin:
 ICZM concept was born during Earth Summit of Rio de Janeiro.
→ Aim:
 to improve livelihood of coastal communities and conserve coastal ecosystem. protect and conserve coastal and
marine ecosystems through holistic management of resources.
→ Beach Environment & Aesthetics Management Services (BEAMS):
 What:
• one initiative under Integrated Coastal Zone Management (ICZM) approach. by MoEF&CC. for sustainable
development of coastal regions of India.
 Objective:
• To reduce pollution in coastal waters. Promote sustainable development of beach facilities. Protect &
conserve coastal ecosystems & natural resources. Seriously challenge local authorities & stakeholders to
achieve and maintain high standards of cleanliness. Hygiene & safety for beachgoers in accordance with
coastal environment & regulations.
 CAG audit report on conservation of coastal ecosystems [2022]:
→ Below are findings of performance audits of Conservation of Coastal Ecosystems from 2015-20:
 National Coastal Zone Management Authority (NCZMA) is still functioning as ad-hoc body. Thus, impacting
consistency in coastal conservation.
 Delay or non-existent State / UT Coastal Zone Management Authorities (SCZMA): Eg., Karnataka has still not
constituted it while Goa, West Bengal, Odisha have delayed its reconstitution. In Andhra Pradesh, District Level
Committees were not even established.

Page 600 of 719

  Several projects approved despite EIA report highlighted inconsistency: Incidences of illegal construction
activities (reducing coastal space) and effluent discharges from local bodies, industries and aquaculture farms.
Other issues in EIA: non-accredited consultants preparing EIA, using outdated data, and not evaluating
environmental impacts of project.
 Expert Appraisal Committees not being present during project deliberations. Members of EAC were fewer than
1/2th of total strength during deliberations.
 State-level issues: States haven’t yet prepared Integrated Management Plan for critically vulnerable coastal
areas. Tamil Nadu didn’t have strategy in place to conserve Gulf of Mannar Islands. Goa: there was no system
for monitoring coral reefs and no management plans to conserve turtle nesting sites.
→ Recommendations:
 NCZMA and SCZMA be made permanent. Proper ecological evaluation before granting clearances. Preparing
detailed map and management plan for coral reefs, turtle nesting sites etc.
Value Addition:
 SDG 14:
→ Conserve and sustainably use oceans, seas and marine resources.
Question:
 Blue carbon - Carbon captured by oceans and coastal ecosystems.
 Two important rivers- one with its sources in Jharkhand (and Known by a different name in Odisha, and another, with its
source in Odisha- merge at a place only a short distance from the coast of the Bay of Bengal before flowing into the sea.
This is an important site of wildlife and biodiversity and a protected area. This place is none other than – Bhitarkanika.
Mains Link:
 Critically examine Coastal Regulation Zone rules from the perspective of environmental and distributive justice.
Discuss. (15M)

TELECOMMUNICATION
News:
 2005:
→ Government’s (Department of Telecom) definition of AGR calculation challenged by firms / companies. [Govt. says
AGR includes all revenues while companies argue that it includes only revenue from core services].
 2015:
→ Telecom Disputes Settlement and Appellate Tribunal (TDSAT) rules that companies / firms’ definition of AGR is
correct.
 2019:
→ Supreme Court sets aside TDSAT’s judgment saying government’s definition is correct. And, orders telecom firms to
pay AGR dues.
→ Department of Telecom asks TRAI to furnish its recommendations on strategies of National Digital Communications
Policy 2018.
 2020:
→ Supreme Court gives telecom companies 10 years’ time to pay their Adjusted Gross Revenue (AGR) dues to
government.
→ Also, Supreme Court said National Company Law Tribunal (NCLT) should decide whether or not spectrum can be sold
under IBC 2016.
→ TRAI recommends that new National Numbering Plan (NNP) be issued so that uniquely identifiable number can be
provided to every subscriber in India.
→ UK proposes 5G Club.
 2021:
→ Union Cabinet approves crucial relief package for cash-strapped telecom firms.
→ Bollywood actor Juhi Chawla moves Delhi High Court seeking scientific study on any adverse effects of radio-
frequency radiation emitted by cellular telecommunications using 5G technology on health, life, organ or limb of
adult or child, or to flora and fauna before its official rollout in India.
→ In testing, Vodafone Idea (Vi) claimed to have achieved 5G data speed of 3.7 Gbps on mmWave spectrum band.
 2022:
→ Department of Telecommunications (DoT) (Min. of Com.) says Gurugram, Bengaluru, Kolkata, Mumbai, Chandigarh,
Delhi, Jamnagar, Ahmadabad, Chennai, Hyderabad, Lucknow, Pune, Gandhi Nagar would first get 5G services in 2022.
→ Department of Telecommunications (DoT) invites Expression of Interest (EoI) for “5G Vertical Engagement and
Partnership Program (VEPP)” initiative to build strong collaboration partnerships across 5G Use-case ecosystem
stakeholders.
→ Minister of Communications, Shri Ashwini Vaishnaw, says that commercial rollout of 5G services could be expected
in 2022 itself. Government is confident of resolving issues related to high spectrum pricing with industry.
→ Short for Open Radio Access Network (Open RAN), is critical to 5G deployment. In India, Open RAN architecture is
essential but also fraught with challenges.

Page 601 of 719

 → Prime Minister Narendra Modi open India’s 1st 5G testbed, to allow start-ups and industrial companies to test their
products locally, eliminating reliance on international facilities. Modi added that India’s own 5G standard, 5Gi, is
source of great pride for India and that it will play significant role in delivering 5G technology to India’s villages.
→ Cabinet clears way for auction of 5G spectrum.
→ Centre for Development of Telematics (C-DOT) will develop end-to-end 5G RAN products in collaboration with Galore
Networks (one Indian Private company).
→ GOI releases amendment in Indian Telegraph Right of Way Rules, 2016 to facilitate faster and easier deployment of
Telecom Infrastructure and also launches one new 5G RoW application 'form’ on GatiShakti Sanchar Portal to enable
faster 5G roll-out in India.
→ Reliance Jio (India’s largest telecom company) says it will launch its 5G services on one “standalone” 5G architecture,
against “non-standalone” approach that other operators are betting on. Also, Reliance Jio announces that it will
launch its 5G services in Delhi, Mumbai, Kolkata, Chennai in later 2022, with aim to expand and cover entire India by
2023.
→ In bid to do away with British-era laws governing telecom sector, Department of Telecommunications (DoT) issues
draft Indian Telecommunication Bill, 2022. It aims to bring in sweeping changes to how telecom sector is governed,
primarily by giving Centre more powers in several areas to do so.
→ DGCA raises concern over 5G rollout: As India’s telecom operators prepare for rollout of 5G services, country’s
aviation safety regulator DGCA writes to telecom department flagging concerns over likely interference of 5G C-Band
spectrum with aircraft radio altimeters. Primary concern of DGCA emerges from fact that these altimeters as well as
part of 5G telecom services operate in C-Band. For telecom service providers, C-Band presents sweet spot for rolling
out 5G services, ensuring coverage as well as high bandwidth, resulting in faster internet speeds. For aircraft
operations, use of altimeters in C-band ensures highly precise measurements of plane’s altitude.
→ GOI is pushing tech giants to make smartphones compatible with India’s NavIC navigation system. [Companies are
now worried that it will increase hardware and software costs]. [Russia sought to mandate inclusion of its own
GLONASS system in smartphones sold locally to reduce reliance on GPS. China’s Beidou was completed in 2020, and
over 94% of China-made smartphones have Beidou support].
→ Department of Telecommunications (DoT) makes it mandatory for mobile phone manufacturers to register
International Mobile Equipment Identity (IMEI) of all handsets made in India with government. Importers, too, will
have to register with government IMEI number of each phone before importing it.
→ PM Narendra Modi launches first phase of 5G services in 13 cities
→ At inauguration days of India's biggest technology festival - India Mobile Congress (IMC) 2022, PM Modi launches 1st
phase of 5G services in 13 cities across India.
 Importance:
• PM called this 5G services launch “revolution”: New India – India is no longer just consumer of technology
but contributor to its development too.
• At time of launch of 2G, 3G, and 4G services, India was dependent on other countries. But with 5G, India is
setting foot in new historical era and is leading globally.
→ At its ongoing 90th General Assembly in Delhi, The Interpol unveils the 1st-ever ‘metaverse’ specifically designed for
law enforcement worldwide.
→ Interpol launches 1st-ever metaverse for law enforcement worldwide: At its ongoing 90th General Assembly in Delhi,
The Interpol unveils the 1st-ever ‘metaverse’ specifically designed for law enforcement worldwide.
About:
 Mobile Network Generations:
→ What:
 1G (1st generation):
• 1980s. Analog voice. Human-human early mobile phones.
 2G (2nd generation):
• 1990s. Digital voice. low speed data, voice, some texts. Ex. CDMA.
 3G (3rd generation):
• 2000s. Mobile Broadband. High speed data, internet access. Ex. impoved CDMA
 4G (4th generation):
• 2010s. Faster / better 3G. IP-based network, high speed internet, streaming, apps. Ex. 4G LTE Volte.
 5G (5th generation):
• 2020s. Interconnected devices, sensors and systems. For govts., businesses, consumers.
 History [India]:
→ Under National Telecom Policy, 1994, telecom sector was liberalized. After which, licenses were issued to companies
in return for fixed license fee. However, in 1999, government gave option to licensees to migrate to revenue sharing
fee model so as to provide relief from highly fixed license fee. Under this revenue sharing fee model, mobile
telephone operators were mandated to share X percentage of their Adjusted Gross Revenue (AGR) with government
as annual License Fee (LF) and Spectrum Usage Charges (SUC). License agreements between Department of
Telecommunications (DoT) and telecom companies define gross revenues of telecom companies.

Page 602 of 719

 Spectrum:
→ What:
 It is one condition that is not limited to specific set of values but can vary, without gaps, across continuum. Word
was 1st used scientifically in optics to describe rainbow of colors in visible light after passing through prism. As
scientific understanding of light advanced, it came to apply to entire electromagnetic spectrum. It thereby
became mapping of range of magnitudes (wavelengths) to range of qualities, which are perceived "colors of
rainbow" and other properties which correspond to wavelengths that lie outside of visible light spectrum.
Energy travels in form of waves known as electromagnetic waves. These waves differ from each other
in terms of frequencies. This whole range of frequencies is called spectrum. In telecommunication like TV, radio,
GPRS, radio waves of different wavelengths are used.
Mobile phones use 2 technologies based on different parts of radio spectrum — GSM and CDMA. Most
of radio spectrum is reserved in countries for defence. Rest is available for public use. But following increase in
number of phone users and new services, countries started auctioning frequencies to telecom companies.
 Spectrum refers to the invisible radio frequencies that wireless signals travel over. Devices such as cell phones
and wireline telephones require signals to connect from one end to another. These signals are carried on
airwaves (medium of radio waves), which must be sent at designated frequencies to avoid any kind of
interference. All these airwaves are sold for a certain period of time, after which their validity lapses, which is
generally set at 20 years in India. GOI owns all the publicly available assets within the geographical boundaries
of India, which also include airwaves.
→ Spectrum policy in India:
 India liberalized the telecom sector in 1981. India had initially adopted first-cum first licence policy during the
initial days of mobile telephony. However, the 2G scam (2007) led to the replacement of the previous policy with
the open auction of spectrum (which began in 1994).
 Spectrum Auction [India]:
• What:
 process in which government uses auction system to sell rights to transmit signals over specific bands
of electromagnetic spectrum and to assign scarce spectrum resources.
• Background:
 Communication devices – cellphones, wireline telephones etc. - require signals. These signals are
carried on airwaves, sent at designated frequencies to avoid interference.
• How:
 Union government owns all publicly available assets, including airwaves, within geographical
boundaries of India. As cellphone, wireline telephone and internet users increase, there is need to
provide more space for signals. Union govt. sells these assets (airwaves), via DoT auctions (via TRAI), to
companies willing to set up infrastructure to transport these waves from one end to another. These
airwaves are called spectrum, which is subdivided into bands with different frequencies. Spectrum are
sold for period of time, after which validity lapses, generally 20 years [changed to 30 years in 2021].
• Govt. Aim:
 market-determined price. efficient use of spectrum. Avoid hoarding. Competition. maximise revenue.
• Likely bidder for spectrum in India:
 private telecom players -Reliance Jio, Bharti Airtel etc. foreign companies - branch in India or registered
as Indian company or tied up with Indian company.
• Auction of 5G spectrum:
 Status: In 2022, Cabinet cleared way for auction of 5G spectrum.
 Benefits:
o Newer avenues: 5G auction and steps outlined for bidding would open up newer avenues for
deeper penetration, access and rich user experience; Option of surrender: Operators would have
flexibility to surrender spectrum after 10 years without any liabilities; Wider choices: Wide
availability of spectrum across all bands will help potential bidders to opt for spectrum bands and
quantum as per their strategy; Benefits from captive 5G networks: Captive networks would drive
digital transformation, augment industry efficiencies and lead to greater economic benefits;
Millimetre-waveband: Auction of millimetre-waveband, would not only help unlock ‘true’ potential
of 5G but would also help strategically manage costs for operators.
 Existing issues concerning the spectrum policy of India:
• Digital divide: Effective access to the spectrum has remained a significant barrier.
• Huge potential but with technical limitations: Spectrum having the characteristics of a public good is also an
inexhaustible resource. But while spectrum per se is not depletable, there are technical limitations to its
optimum utilization at a given point in time.
• High cost of spectrum acquisition: Since 2010, GOI has consistently used auctions for spectrum allocation,
and this has increased government revenues but private companies have increased the rate of mobile
telephony to recoup the cost.

Page 603 of 719

 • High reserve price: This has often led to low off-take of available spectrum and thus revenue loss for the
government. According to one estimate, spectrum cost in India is amongst the most expensive in the world.
• Inequity: Commercialization of the spectrum has resulted in some areas being underserved or unserved
affecting quality and quantity.
 Achievement:
• Despite the recognised failure, India has billion-plus mobile subscribers, and 800 million internet users and
hosts the 2nd-largest telecommunications network in the world.
 Way Forward:
• Active promotion of the idea of ‘niche operators’: The draft Indian Telecommunication Bill, 2022
incorporates practical provisions on the spectrum such as - use it, share it or lose it – an awaited policy that,
however, needs innovative support to be successful.
• Correcting the cost of spectrum and promoting investment in underserved areas.
• Adopting innovative methods. Eg. Canada has initiated consultations on a non-competitive local licensing
framework to facilitate broadband connectivity in rural areas.
• Promoting transparency: GOI should build an ecosystem that inspires trust so that transparency in the
assignment can be secured at a reasonable price for operators with strict service obligations.
• Enhancing healthy competition.
• Solving digital divide. The vision of “Digital India” can never be realised if affordable broadband connectivity
remains only within the reach of a few.
 5G Technology:
→ What:
 next generation of mobile broadband that would replace / augment current 4G LTE connection. Operate in
millimeter wave (mmWave) spectrum (30-300 GHz) [advantage of sending large data at very high speeds].
→ Feature / benefit:
 Operate in millimeter wave (mmWave) spectrum (30-300 GHz). exponentially faster download speed.
exponentially faster upload speed. Reduced latency. Operates in 3 bands - low, mid, high frequency spectrum.
[High-band spectrum offers highest speed of all 3 bands, but has extremely limited coverage and signal
penetration strength.]. Gbps. ultra-low latency [good for Internet of Things (IoT), AI]. massive capacity [thus can
minimize impact of load increase]. uniform user experience.
 5G network will allow for much faster Internet speeds and lower latency compared to 4G. Peak speeds could
touch 10 Gbps, compared to 100 Mbps for 4G. While 4G latency is 10-100 millisecond, on 5G it is expected to be
under 1 millisecond.
→ Different modes of 5G networks:
 5G networks are deployed mainly on 2 modes: standalone and non-standalone. Both architectures have their
advantages and disadvantages:
• In standalone mode, which Jio has chosen, 5G network operates with dedicated equipment and runs parallel
to existing 4G network i.e. end to end it is 5G and 5G at both base station and in core. Its advantages are
standalone mode provides access to full 5G capabilities and new network functionalities such as slicing that
provides greater flexibility to operators to efficiently use their spectrum holdings. Its disadvantage are it is
costly and will require software updates on existing smartphones to work.
• In non-standalone mode, 5G network is supported by 4G core infrastructure i.e. 5G at base station but in
core network it is still 4G. Its advantages are initial cost and time taken to roll out services through this track
is significantly less than standalone networks and can work on most smartphones. Its disadvantage are
operators eventually will have to go for Standalone mode as traffic increases.
→ Principle:
 5G is based on Orthogonal Frequency-Division Multiplexing (OFDM): Reduction in interference because of
modulation of digital signal across several different channels; wider bandwidth technologies – sub-6 GHz,
millimeter wave.
→ Usage:
 Interconnected devices, sensors and systems. For govts., businesses, consumers.
→ Potential health risks from 5G:
 Researchers conducted till date show no adverse health effects by exposure to wireless technologies. Tissue
heating. As frequency increases, there is less penetration into body tissues. As frequency increases, absorption
of energy becomes more confined to surface of body (skin, eye etc). No consequences to public health are
expected, provided overall exposure remains below international guidelines.
 [On issues associated with 5G, Bollywood actor Juhi Chawla moved Delhi High Court seeking scientific study on
any adverse effects of radio-frequency radiation emitted by cellular telecommunications using 5G technology on
health, life, organ or limb of adult or child, or to flora and fauna before its official rollout in India].
 [Provided that overall exposure remains below international guidelines, no consequences for public health are
anticipated].
→ Significance:

Page 604 of 719

 India’s National Digital Communications Policy, 2018 states that 5G technology, cloud computing, Internet of
Things (IoT), data analytics etc. will accelerate and deepen its digital engagement and provide new opportunities.
 5G technology will provide seamless coverage, high data rate, low latency, and highly reliable. It will increase
energy efficiency, spectrum efficiency and network efficiency.
 5G as technology multiplier: 5G is much more than next generation of technology. It actually unlocks potential
of other technologies like AI, IOT, Robotics, Blockchain, Metaverse.
 5G will help in real-time monitoring of disasters, precision agriculture, and minimising role of humans in
dangerous industrial operations such as in deep mines, and offshore activities.
 Education: 5G facilitate education by bringing teachers closer to students (through effective virtual classes),
obliviating physical distance between them.
 Safety: Ex - Safety of workers in under-construction tunnel of Delhi Metro through creation of Digital Twin of
that tunnel.
→ Countries working on 5G technology:
 US, China, India, UK etc.
→ Global efforts:
 International Electromagnetic Fields (EMF) Project, 1996: established by WHO; investigates health impact of
exposure to electric and magnetic fields.
 International exposure guidelines on electromagnetic fields : 2 international bodies - Institute of Electrical
and Electronics Engineers, 1963; International Commission on Non-Ionizing Radiation Protection (ICNIRP), 1992
- provides exposure guidelines on electromagnetic fields [includes 5G frequencies]. Currently, many countries
adhere to said guidelines.
→ 5G in India:
 Status:
• 5G is yet to take off in India and India has taken its own time to figure out aspects for it. While many other
countries have had 5G for while or have started with their 5G, Indian government is yet to auction spectrum
that will be used for 5G network. New reports suggest India is hoping to incorporate locally designed 5Gi
network, which has been developed by IIT Hyderabad and IIT Madras. So it is possible Indian government is
looking for answers that convince them that using 5Gi network will be more beneficial in India, rather than
going for global standard 5G setup.
 Initiative:
• Centre said auction of 5G spectrum would take place in early 2022. But, experts say it could be delayed as
telecom service providers are yet to complete their trials and test various aspects. Private telecom players:
Reliance Jio, Bharti Airtel, Vodafone Idea are bidding for 5G spectrum allocation. Reliance Jio to launch
indigenously built 5G network for India. TRAI is in final stages of stakeholder consultations, and is likely to
submit its recommendations to DoT in 2022. Private Telecom companies in progress regarding rollout of 5G
– conducting trials, testing speeds, building indigenous 5G networks, etc. 5G Vertical Engagement and
Partnership Program (VEPP) [2022].
• National Digital Communications Policy 2018 emphasis on integration of digital ecosystem (including 5G)
with economic and societal growth.
 Need:
• Data consumption: Tremondous rise, India is 2nd biggest smartphone market in world; Low fibre
penetration; Industry 4.0 / 4th Industrial Revolution; Smart City Mission.
 Challenges:
• Procedural Delays: India’s telecom sector is greatly affected by procedural delays and their multiple issues;
Affordability of Spectrum: Many countries around world already rolled out 5G connectivity to its users but,
in India, 5G spectrum is yet to be allocated. High price of spectrum; Last-mile Connectivity: Providing last-
mile broadband connectivity to rural homes are challenging in India because India lacks optical fiber
infrastructure and Greenfield deployment; Affordable 5G Devices: On consumer front, affordable 5G
devices are yet to take their place in market; Lack of capital with Bharti Airtel and Vodafone Idea.
 Way ahead:
• Create positive environment for 5G launch in India. Govt. needs to sort out telecom financial crisis.
Streamline spectrum policy - employment, technology, investment etc.
• Focus area for India should be - price of 5G device, digital connectivity, cost of data, idea of digital 1 st.
 Conclusion:
• National Digital Communications Policy 2018: 5G technology, Cloud computing, Internet of Things (IoT),
Data Analytics; India cannot afford missing out on 5G.
 5Gi:
→ What:
 5Gi is basically Made in India 5G standard created through joint collaboration between IIT Hyderabad
and IIT Madras (Chennai). This network standard has already got nod from International
Telecommunication Union (ITU). 5Gi will reportedly operate on same bands and spectrum as regular

Page 605 of 719

 5G network. In fact, many say that 5Gi uses millimeter wave technology to provide high-speed internet
connectivity. locally designed / homegrown 5G network. India’s 5G Radio Interface Technology. It is
locally designed telecommunication network by IIT Hyderabad, IIT Ma dras and Centre of Excellence in
Wireless Technology. It will be alternative to global 5G standards.
→ Feature:
 5Gi offers more range at lower frequency, which is opposite of 5G. 5G works between 700 MHz to
52,000 MHz bands and sacrifices on range. Theoretically, 5Gi can work with lower-end spectrum bands,
which would make it more cost-effective.
→ Benefit:
 5Gi standard will allow telcos in India to widen 5G connectivity net to villages. cost -effective
technology, which can be beneficial if implemented at large scale by operators in India. Rural network
has always lagged behind urban setup, but 5Gi can make sure there is no lag between advancement of
5Gi in cities like Delhi, Mumbai, Chennai, and rural parts of India. 5Gi promises fast internet
connectivity. It also helps in improving mobile coverage.
→ Challenges:
 News about 5Gi will definitely have come as shock to telecom operators in India. After all, they spent
millions on upgrading their network to offer 5G connectivity. And now, out of blue, India is conside ring
switching to 5Gi, local standard. So, eventually, if India decides to go with 5Gi as its default network
standard, this could become problematic for telcos. Their existing setup will have to be re-engineered
to support 5Gi standard. And that will cost them lot of money once again. Telecom body in India claims
that 5Gi cannot work with global 5G standard that is based on 3GPP technology. Moving from 5G to
5Gi will be cost-intensive and most likely make local bands incompatible with global network. If 5Gi
does come, chances are these phones will not be compatible with local bands for 5G. People will have
to consider buying new 5Gi phone. Unless technology allow 5G and 5Gi to work in tandem, people
could be in difficult situation in near future.
 Radio Access Network (RAN):
→ What:
 RAN is major component of wireless telecommunications system that connects individual devices to
other parts of network through radio link. RAN links user equipment, such as cellphone, computer or
any remotely controlled machine, over fiber or wireless bac khaul connection. That link goes to core
network (CN), which manages subscriber information, location etc. RAN is radio element of cellular
network. Cellular network is made up of land areas called cells. One Cell is served by at least 1 radio
transceiver, although standard is typically 3 for cell sites. RANs have evolved from 1 st generation (1G)
to 5 th generation (5G) of cellular networking.
→ Feature:
 It is part of mobile telecommunication system. It implements radio access technology. Conceptually,
it resides between device such as mobile phone, computer, or any remotely controlled machine and
provides connection with its core network (CN). RAN functionality is typically provided by silicon chip
residing in both core network as well as user equipment.
→ RAN elements:
 One RAN is made up of 3 essential elements - Antennas: They convert electrical signals into radio waves;
Radios: They transform digital information into signals that can be sent wirelessly and ensure that transmissions
are in correct frequency bands with right power levels; Baseband units (BBUs): They provide signal processing
functions that make wireless communication possible. BBU processing detects errors, secures wireless signal
and ensures that wireless resources are used effectively.
→ Open Radio Access Network / Open RAN / O-RAN:
 What:
• O-RAN is totally disaggregated approach to deploying mobile fronthaul and midhaul networks built entirely
on cloud native principles. O-RAN is evolution of Next Generation RAN (NG-RAN) architecture, 1st introduced
by GSMA’s 3GPP. It is one key part of mobile network system that uses cellular radio connections to link
individual devices to other parts of network.
 Feature:
• It comprises antennae, which transmits and receives signals to and from our smartphones or other
compatible devices. Signal is then digitised in RAN-base station and connected to network. O-RAN uses
software to make hardware manufactured by different companies work together.
 Advantages:
• Open environment expands ecosystem, and provides more Options to Operators. It will boost new
opportunities for Indian entities to enter into network equipment market. It is expected to make 5G more
flexible and cost-efficient. Open RAN architecture allows for separation or disaggregation, between
hardware and software with open interfaces.
→ Open RAN vs traditional RAN:

Page 606 of 719

  In traditional set-up, RAN is provided as integrated platform of both hardware and software. Therefore, it is
difficult to mix vendors for radio and baseband unit, and in most cases, they come from same supplier. Idea of
Open RAN is to change this, and enable operators to mix and match components.
 Challenges [India]:
→ CAG criticized that Spectrum allocation in India is conducted on ad hoc basis (2012-2021); and spectrum allocated to
government is not optimally used.
→ AGR issue triggered panic in banking industry [because telecom sector is highly leveraged (used borrowed capital
from banks)]. Example - Vodafone Idea has lots of debt. Mutual fund industry has also given lots of loan to Vodafone
Idea. spectrum auction / allocation; high price of spectrum; low optical fibre penetration across India.
→ Dispute between DoT and mobile operators: Issue is mainly on definition of AGR:
 DoT says AGR includes all revenues from both telecom and non-telecom services.
 Companies say AGR should include just revenue earned from core services (telecom) and not dividend, interest
income, profit on sale of any investment or fixed assets.
 How did financial condition of telcos deteriorate [India]:
→ It started with differing legal interpretation of AGR. In 1999, government decided to shift from fixed fee to revenue-
sharing model for telecom sector. Telecom players would pay X percentage of their AGR, earned from telecom and
non-telecom revenues, as licence and spectrum fee. In 2003, DoT raised demand for AGR payments. DoT said all
revenues earned by telcos as dividend from subsidiaries, interest on investments etc. (revenue from non-telcos
services) would be included for calculation of AGR. Telcos approached TDSAT. TDSAT rejected government’s
contention. Centre moved Supreme Court. In 2012, Supreme Court cancelled telecom licences in 2G scam case, after
which spectrum is now allocated through auctions. In 2019, Supreme Court holds that DoT’s definition of AGR is
correct, and that telcos must pay AGR, interest, penalty on non-payment.
 Initiative:
→ Telecom Regulatory Authority of India (TRAI) Act, 1997 [India].
→ National Digital Communications Policy 2018 [India].
→ National Numbering Plan (NNP) [India].
→ 2021 relief package for telecom (<-telecom reforms):
 Feature:
• Moratorium on payments: Postpone payment of statutory dues by telecom companies.
• 100% FDI through automatic route: This liberalisation makes it easier for telcos to find global investors.
• Rationalisation of Adjusted Gross Revenue (AGR): All non-telecom revenue is removed from AGR
• Rationalisation of spectrum ecosystem: Fixed calendar for auctions; No need for bank guarantees.
• Reducing Spectrum Usage Charges (SUC): Telcos are allowed to hold spectrum for 30 years (instead of earlier
20 years).
 Importance:
• It will provide much needed relaxation to telecom companies - Vodafone Idea, Reliance Jio, Bharti Airtel. It
will protect and generate employment opportunities, promote healthy competition, protect consumers
interests, infuse liquidity, encourage investment, reduce regulatory burden on Telecom Service Providers
(TSPs). It will make cash-strapped telcos firm to improve its business and clear dues in future.
 Way ahead:
→ Create positive environment for 5G launch in India. Govt. needs to sort out telecom financial crisis. Streamline
spectrum policy - employment, technology, investment etc.
Note:
 Telecom Regulatory Authority of India (TRAI) Act, 1997 [India]:
→ Telecom Regulatory Authority of India (TRAI):
 What:
• TRAI is a regulatory body set up by the Government of India under Telecom Regulatory Authority of India
Act, 1997. It is the regulator of the telecommunications sector in India.
• statutory body. by Telecom Regulatory Authority of India (TRAI) Act, 1997. regulator of telecommunications
sector and its tariffs in India.
 Mission:
• To create and nurture conditions for growth of telecommunications in India to enable India to have leading
role in emerging global information society.
 Functions:
• To regulate telecom services, including fixation / revision of tariffs for telecom services which were earlier
vested in GOI.
• Provide fair and transparent environment that promotes level playing field and facilitates fair competition
in the market.
• To issue orders and directions on various subjects such as tariffs, quality of service, interconnections, DTH
services and mobile number portability.
• TRAI fixes or revises tariffs for telecom services in India.

Page 607 of 719

 • Tariffs. Interconnections. quality of service. Direct To Home (DTH) services. mobile number portability.
 Composition:
• Chairperson + max. of 2 full-time members + max. of 2 part-time members. appointed by Central
Government. 3 years or 65 years.
→ Telecom Disputes Settlement and Appellate Tribunal (TDSAT) [2000]:
 What:
• TRAI Act, 1997 was amended by an ordinance, effective from 2000, establishing a Telecom Disputes
Settlement and Appellate Tribunal to take over the adjudicatory and disputes functions from TRAI.
• by Telecom Regulatory Authority of India (TRAI) Act, 1997. to take over adjudicatory and disputes functions
from TRAI.
 Aim:
• bring in functional clarity in telecommunication sector. strengthen regulatory framework in
telecommunication sector. strengthen disputes settlement mechanism in telecommunication sector.
protect interests of service providers and consumers of telecom sector.
 Composition:
• Chairperson + 2 Members. Judge / retired judge of Supreme Court or Chief Justice / retired of High Court –
Chairperson. appointed by Central Government.
 Function:
• adjudicate disputes. dispose of appeals.
 Jurisdiction:
• matters that lay before Cyber Appellate Tribunal. matters that lay before Airport Economic Regulatory
Authority Appellate Tribunal. Telecom. Broadcasting. IT and Airport tariff matters under TRAI Act, 1997,
Information Technology Act, 2008, Airport Economic Regulatory Authority of India Act, 2008. original +
appellate jurisdiction in regard to Telecom, Broadcasting and Airport tariff matters. appellate jurisdiction in
regard to cyber matters.
 National Digital Communications Policy 2018 [India]:
→ What:
 customer focused and application driven policy for Indian Telecom Sector
→ Need:
 Present world has entered era of modern technological advancements in Telecom Sector such as 5G, loT, M2M
etc. That is, to address modern needs of digital communications sector in India.
→ Focus:
 5G technology. Cloud computing. Internet of Things (IoT). Data Analytics.
→ Objectives:
 Broadband for all; Creating four million additional jobs in the Digital Communications sector; Enhancing the
contribution of the Digital Communications sector to 8% of India's GDP from ~ 6% in 2017; Propelling India to
the Top 50 Nations in the ICT Development Index of ITU from 134 in 2017; Enhancing India's contribution to
Global Value Chains; Ensuring Digital Sovereignty.
→ Vision:
 To fulfil the information and communication needs of citizens and enterprises through the establishment of a
ubiquitous, resilient, secure, accessible and affordable Digital Communications Infrastructure and Services; and
in the process, support India’s transition to a digitally empowered economy and society.
→ Missions:
 Connect India: Creating Robust Digital Communications Infrastructure To promote Broadband for All as a tool
for socio-economic development, while ensuring service quality and environmental sustainability.
 Propel India: Enabling Next Generation Technologies and Services through Investments, Innovation and IPR
generation To harness the power of emerging digital technologies, including 5G, AI, IoT, Cloud and Big Data to
enable provision of future ready products and services; and to catalyse the fourth industrial revolution (Industry
4.0) by promoting Investments, Innovation and IPR.
 Secure India: Ensuring Sovereignty, Safety and Security of Digital Communications To secure the interests of
citizens and safeguard the digital sovereignty of India with a focus on ensuring individual autonomy and choice,
data ownership, privacy and security; while recognizing data as a crucial economic resource.
 Features:
• Provide universal broadband connectivity at 50 Mbps to every citizen; Provide 1 Gbps connectivity to all
Gram Panchayats by 2020 and 10 Gbps by 2022; Ensure connectivity to all uncovered areas; Attract
investments of USD 100 billion in the Digital Communications Sector; Train one million manpower for
building New Age Skill; Expand IoT ecosystem to 5 billion connected devices; Establish a comprehensive data
protection regime for digital communications that safeguards the privacy, autonomy and choice of
individuals; Facilitate India's effective participation in the global digital economy; Enforce accountability
through appropriate institutional mechanisms to assure citizens of safe; Secure digital communications
infrastructure and services.

Page 608 of 719

  Strategy:
• Establishment of a National Digital Grid by creating a National Fibre Authority; Establishing Common Service
Ducts and utility corridors in all new city and highway road projects; Creating a collaborative institutional
mechanism between Centre, States and Local Bodies for Common Rights of Way, standardization of costs
and timelines; Removal of barriers to approvals; Facilitating development of Open Access Next Generation
Networks.
 National Numbering Plan (NNP) [India]:
→ NNP governs management of numbering resources. Department of Telecom (Ministry of Communications)
administers numbers for fixed and mobile networks based on International Telecommunication Union (ITU)’s
Telecommunication Standardization recommendations. Telecom Regulatory Authority of India (TRAI) recommended
that automated allocation of numbering resources should be done by using number management system software
to speed up allocation process. TRAI also recommended: switching to 11-digit mobile number; reallocation of mobile
numbering resources surrendered by operators who have shut shop; prefixing zero for all mobile calls made from
fixed line.
 Adjusted Gross Revenue (AGR):
→ What:
 spectrum usage fee and licensing fee that telecom operators are charged by Department of Telecommunications
(DoT).
→ Calculation / Contention:
 As per DoT, AGR charges are calculated based on all revenues earned by telecom. It includes non-telecom related
sources - deposit interests, asset sales etc. Telcos (Telecom companies) argue that AGR should include only
revenues generated from telecom (core) services.
 5G Vertical Engagement and Partnership Program (VEPP) [2022]:
→ What:
 Initiative to access to new opportunities and facilitation in untapped 5G ecosystem. under DoT, Min.
of Com.
→ Objective:
 To build strong collaboration partnerships across 5G Use-case ecosystem stakeholders so as to address
User/Vertical Industry needs.
→ Feature:
 Under it, DoT will facilitate necessary approvals, regulatory clearances to enable use case prototyping,
pilots, demos, trials at user or vertical industry premises. Under it, DoT will also facilitate access to
experimental spectrum, access to testbeds and engagement with academia, other ministries for
necessary regulatory policies and pilots.
→ Significance:
 It can trigger multiplier effect to try & finetune 5G digital solutions in respective economic verticals.
 Tissue heating:
→ Tissue heating is mechanism of interaction between radio frequencies and human body. Radio frequency
exposures from current technologies result in negligible temperature rise in human body.
 Industry 4.0 / 4th Industrial Revolution:
→ AI, Machine Learning (ML), Internet of Things (IoT), Edge Computing.
 LTE (Long-Term Evolution):
→ 4th-generation (4G) wireless standard that provides increased network c apacity and speed for cellphones
and other cellular devices compared with 3rd -generation (3G) technology].
 Orthogonal Frequency-Division Multiplexing (OFDM):
→ In telecommunications, OFDM is type of digital transmission and method of encoding digital data on
multiple carrier frequencies. OFDM is basis for / used in popular wideband digital communications: digital
television, audio broadcasting, DSL internet access, wireless networks, power line networks, 4G / 5G
mobile communications.
 5G CLUB:
→ What:
 Proposed, by UK, 10 democratic countries i.e D10 club of democracies.
→ Members:
 G7, South Korea, India, Australia.
→ Need:
 security concerns related to Chinese telecom giants – Huawei etc.
→ Aim:
 alternative suppliers of 5G equipment and related technologies. Avoid rely ing on China – Huawei etc.
 Millimeter wave (MM wave) / millimeter band:
→ Band of spectrum with wavelengths between 10 millimeters (30 GHz) and 1 millimeter (300 GHz). It is also known as
extremely high frequency (EHF) band by ITU.

Page 609 of 719

  Centre for Development of Telematics (C-DOT) [1984]:
→ One Indian Government owned telecommunications technology development centre. It is one autonomous telecom
R&D centre and registered society under Societies Registration Act, 1860. It designs and develops digital exchanges,
intelligent computer software applications. It has offices in Delhi, Bangalore, Kolkata.
 International Mobile Equipment Identity (IMEI):
→ One numeric identifier, usually unique, for 3GPP and iDEN mobile phones, as well as some satellite phones. It is
usually found printed inside battery compartment of phone but can also be displayed on-screen on most phones.
GSM networks use IMEI number to identify valid devices, and can stop stolen phone from accessing network.
Devices without SIM card slot or eSIM capability usually don't have IMEI code. Dual SIM enabled phones will
have 2 IMEI numbers.
IMEI is one unique 15-digit number that is used to identify device on mobile network, acting like phone’s unique
identity.
Phones with dual-SIM option have 2 IMEI numbers, one for each SIM. IMEI number can help network providers
track down device in case it gets stolen or is lost. Once such loss or theft is reported, carriers can deny device access
to cellular network even with new SIM card.
→ In 2022, Department of Telecommunications (DoT) (GOI) made it mandatory for mobile phone manufacturers to
register International Mobile Equipment Identity (IMEI) – 15-digit numbers that uniquely identify each mobile device
– of all handsets made in India with government. Importers, too, will have to register with government IMEI number
of each phone before importing it.
 Metaverse:
→ What:
 In science fiction, the "metaverse" is a hypothetical iteration of the Internet as a single, universal, and immersive
virtual world that is facilitated by the use of virtual reality (VR) and augmented reality (AR) headsets. In colloquial
usage, a "metaverse" is a network of 3D virtual worlds focused on social connection.
Metaverse development is often linked to advancing virtual reality technology due to the increasing
demands for immersion. Recent interest in metaverse development is influenced by Web3, a concept for a
decentralized iteration of the internet. Web3 and metaverse have been used as buzzwords to exaggerate the
development progress of various related technologies and projects for public relations purposes.
It is an extension of our real world into the digital realm providing an immersive multi-user experience
for anyone accessing it around the globe. Accessing this virtual world requires the Internet and digital devices.
The technology behind this is called Augmented Reality (AR) and Virtual Reality (VR).
→ Origin:
 The term "metaverse" originated in the 1992 science fiction novel Snow Crash as a portmanteau of "meta" and
"universe".
→ Concern:
 Information privacy, user addiction, and user safety are concerns within the metaverse, stemming from
challenges facing the social media and video game industries as a whole.
 Indian Telecommunication Bill, 2022 [draft]:
→ In 2022, GOI released the draft Indian Telecommunication Bill, 2022, seeking to replace the colonial era Indian
Telegraph Act, 1885.
→ Highlight:
 Updated and consolidated various laws: This draft bill 2022 is an attempt by the Department of
Telecommunication to update the extant regulatory framework and consolidate various legislations presently
governing the telecommunication landscape in India.
 Repealed old legislations: It looks to repeal 3 legislations i.e. the Indian Telegraph Act, 1885, the Indian Wireless
Telegraphy Act, 1933 and the Telegraph Wires (Unlawful Possession) Act, 1950.
 Introduced technological advancements: This new regulatory framework aims to bring the law at par with
technological advancements and remove obsolete provisions from the colonial era laws.
Question:
 With reference to street lighting, Sodium lamps produce light at 360 degrees but it is not so in case of LED lamps.
Spectrum of visible light from sodium lamps is almost monochromatic while LED lamps offer significant colour advantages
in street lighting. Sodium vapour bulbs contain metals that are evaporated into inert gas within glass casing while LEDs
are solid-state technology. Difference is that sodium vapour lights were most efficient technology of 1970s while LEDs
are modern-day equivalent and have more life span.
 With reference to Visible Light Communication (VLC) technology, VLC uses electromagnetic spectrum wavelengths 375
to 780 nm. VLC can transmit large amounts of data faster than Bluetooth. VLC has no electromagnetic interference. Visible
light communication is short-range data communications variant which uses visible light between 400 and 800 THz. VLC
is subset of optical wireless communications technologies. VLC technology uses fluorescent lamps to transmit signals at
10 kbit/s or LEDs for up to 500 Mbit/s over short distances.
 In India, Independent regulators in sectors like telecommunications, insurance, electricity, etc. are reviewed by Ad Hoc
Committees set up by the Parliament, Parliamentary Department-Related Standing Committees. In India, there are 24
Department Related Standing Committees that review the working of regulators within their respective departments. Ad
Page 610 of 719
 Hoc Committees set up by the Parliament may examine the working of regulators. [The role of the Finance Commission
and NITI Aayog is advisory in nature and they do not review independent regulators].
Mains Link:
 Discuss the advantages that 5G technology holds as compared to previous mobile technology. (10M)
 Spectrum auction in India has turned into a buyer’s market. Discuss.

CRIME
News:
 2020:
→ NCRB releases report on accidental deaths. [This report says registered suicide, accidental deaths increase across
India].
 2021:
→ NCRB releases data on offences against state.
→ Karnataka is planning to recruit scene of crime officers (SOC officers).
 Importance: 1st time in India that dedicated officials will be deployed for crime scene evidence collection
 2022:
→ GOI is planning to make forensic investigation compulsory in all cases where offence attracts punishment of 6 years
or more.
 Need: Home Ministry has called for establishment of one independent Directorate of Prosecution and one
independent Directorate of Forensic Science in each State / UT through proposed comprehensive amendments
to IPC, CrPC, Indian Evidence Act.
→ One Mumbai court uses report of one Directorate of Forensic Science Laboratory (DFSL), Mumbai for ‘gait analysis’
(1st time in India), to sentence one man for rape and murder. Gait test helped establish identity of accused in Mumbai
rape-murder case.
→ NCRB releases “Crime in India” report 2021. This report says Nagaland recorded highest rate of crimes under
‘extortion and blackmailing’.
→ NCRB releases Accidental Deaths & Suicides in India (ADSI) report 2021.
→ Delhi Police becomes 1st force to make collection of forensic evidence mandatory. This rule will be followed in all
crimes punishable by more than 6 years.
→ Delhi Police becomes 1st police force in India to make collection of forensic evidence mandatory in crimes punishable
by more than 6 years. Its purpose is to take conviction rate higher and integrate criminal justice system with forensic
science investigation.
→ NCRB releases “Prison Statistics India 2021”.
→ Uniform policy on law and order: Union Home Minister Amit Shah says that States should have a uniform law and
order policy as certain crimes such as cross-border terrorism and cybercrimes transcend regional and international
boundaries. He also says that by 2024, to counter terror activities, each State would have a NIA office as NIA agency
had been given “extra territorial jurisdiction” and additional powers to confiscate property in terror-related cases.
He also calls for centralisation of data on terror and other crimes.
→ Addressing the 1st Chintan Shivir (brainstorming session) of State Home Ministers and top police officers, Prime
Minister Narendra Modi suggest the idea of “One Nation, One Uniform” for Indian police forces. [Modi's 'One Nation,
One Uniform' suggestion is in line with his broader attempt to introduce a uniform set of policies across India]. He
also says police should be equipped to face not only those Naxals who hold a gun but also those who wield a pen
and mislead the youth by exploiting their emotions, and further says such forces who get “international support”
should not be allowed to take roots as they are detrimental to the unity of India.
About:
 Law and Order / Law & Order:
→ Law:
 Ministry of Home Affairs (MHA) can intervene in matters concerning national security, and the Ministry from
time to time sent advisories to States.
 Public order, Police are in State List. “Law and order” is falls under State’s jurisdiction.
→ Initiative:
 India has different agencies for different functions related to law and order like police, NIA (entrusted to
maintain a national terror database), ED (maintains dataset on financial crimes), Narcotics Control Bureau (NCB)
(database on narco crimes), NATGRID (datasets of agencies on a common platform).
→ Way Forward:
 In 2022, Union Home Minister Amit Shah said that States should have a uniform law and order policy as certain
crimes such as cross-border terrorism and cybercrimes transcend regional and international boundaries.
 In 2022, Union Home Minister Amit Shah said that by 2024, to counter terror activities, each State would have
a NIA office as NIA agency was given “extra territorial jurisdiction” and additional powers to confiscate property
in terror-related cases.
 In 2022, Union Home Minister Amit Shah called for centralisation of data on terror and other crimes by following
the principle of “one data, one entry”.
Page 611 of 719
  In 2022, Union Home Minister Amit Shah said amendments would be presented in Parliament about revamping
the IPC and CrPC.
 Police:
→ What:
 coercive arm of state, often in direct contact with ordinary citizens.
→ Constitution:
 Under 7th schedule, police is State subject.
→ Statute:
 Police Act, 1861 (of Parliament). Present Indian police system is largely based on this Police Act, 1861.
→ Police uniform:
 Who decides on uniforms for the police?
• Law and order are part of State subject. Both ‘Public order’ and the ‘Police’ are placed in List II (State List)
of the 7th Schedule of the Constitution. Thus each State has the liberty to decide on the uniform.
• There is variation in uniform. While police personnel in India are often associated with the colour khaki,
their uniforms do differ in varying degrees in different regions.
→ Atrocities by Police:
 Concern:
• Atrocities by Police have emerged as human rights concern:
 It violates Fundamental Rights of citizen:
o Article 19 (Fundamental Right to Freedom).
o Article 20: Adopting 3rd-degree tortures and methods to extract information from accused is in
clear violation of Article 20.
o Article 21: Custodial violence is against fundamental right to life and dignity. [UP has highest
custodial death]
o Article 22: Right to counselis also fundamental right under Article 22. Custodial violence violates it.
 It violates Universal Declaration of Human Rights:
o No one shall be subjected to torture or cruel, inhuman, or degrading treatment or punishment.
 It violates ‘Rule of Law’:
As per National Police Commission Report, most arrests made by police were unnecessary.
 It violates “safety of people” is supreme law.
→ Issues:
 Atrocities by Police.
 Over-burdened police force:
• Vacancy: Law Commission found that one reason behind poor conviction is poor quality of investigations.
 Poor police infrastructure:
• CAG audits found shortages in weaponry with State police forces.
• Shortage of vehicles.
 Lack of accountability:
• nexus between politicians and police.
• 2nd Administrative Reforms Commission (ARC), 2007 reported that political executive (ministers) have
misused power and have used police forces for personal and political reasons.
• Hence, experts have recommended that scope of political executive’s control over police must be limited.
 Police-public relations:
• Police requires confidence, cooperation and support of community to prevent crime and disorder e.g.
informers, witnesses etc.
 Poor training
 Corruption
 Police Act, 1861 is one colonial Law.
 Recent example:
• 2020 Vikas Dubey case in UP.
→ Impact of issues in Police:
 It can be fatal to democratic society —collapse of rule of law.
 poor conviction
 Lose of credibility, confidence, trust in eyes of public.
 Increase in crimes.
→ Police Reforms:
 Before Independence:
• IPC 1860 uses police as weapon of repression and strengthen hold British had over India. Prevention (and
detection) of crime was never their priority. Most of constabulary was illiterate and not paid even ‘living
wage’.
• Fraser commission reforms (1902-03) were not accepted.
Page 612 of 719
 After Independence there have been numerous changes:
• For women:
 Check social evil of dowry: Dowry Prohibition Act, 1961 was passed. Section 498A IPC (Husband or
relative of husband of a woman subjecting her to cruelty) and Section 304B IPC (Dowry death) and
along with certain amendments in Indian Evidence Act, 1872. Custodial torture and sexual harassment
of women have been held to be violations of fundamental rights.
• For children:
 Definition of rape has been widened and offences related to sexual assault made tougher. POCSO Act,
2012, and Juvenile Justice (Care and Protection of Children) Act, 2015 have been enacted.
• For business:
 Ease of doing business: Electronic documents and signatures have been given legal sanctity to facilitate
online transactions and check cybercrime under Information Technology Act, 2000.
• Against discrimination:
 Scheduled Caste and Scheduled Tribe (Prevention of Atrocities) Act,1989 was enacted. Reading down
Section 377 IPC - relief to LGBTQ+ community.
• Against terrorism:
 NIA was constituted in 2008 (after deadly 26/11 terror attacks in Mumbai) to investigate and prosecute
offences affecting national security.
• For Individual:
 Right to privacy has been recognised as fundamental right. Section 124A IPC (Sedition) is under scrutiny
of Supreme Court.
• Institutional changes:
 Move towards inquisitorial system: Attempt to blend some elements of inquisitorial system into
(prevalent) adversarial system by making judicial inquiry into custodial death and custodial rape
mandatory.
 Introduction of police commissionerate system (Kolkata, Mumbai, Hyderabad, Chennai, Lucknow,
Noida).
 Reformation rather than retribution: Probation of Offenders Act, 1958 was enacted.
 Power to arrest having been curtailed, use of handcuffs restrained.
 Presence of lawyer permitted during interrogation.
 CCTV cameras installed in police stations.
 Human rights bodies are allowed to keep constant eye.
 Limitations of reforms / Issues:
• Police continue to be haunted by allegations of being brute force. Trust deficit does not appear to have
bridged. Supreme Court guidelines in Prakash Singh case (2006) is not implementation properly. Despite
‘Police’ being State subject, no State government has given due attention to police reforms so far. Directive
of separating investigation from law and order is not implemented by States and Union Territories in true
spirit. No State or UT has adopted Model Police Act drafted.
 Expert bodies on police reforms:
• National Police Commission, 1977-81
• Ribeiro Committee, 1998
• Padmanabhaiah Committee, 2000
• Malimath Committee, 2002-03
• Police Act Drafting Committee, 2005
• 2nd Administrative Reforms Commission, 2007
• Police Act Drafting Committee II, 2015
• Central Government also reviewed Model Police Act, 2006 and accordingly, one draft Model Police Bill, 2015
was prepared.
 Role of judiciary:
• As always, judiciary is source of hope and action for police reforms.
• Supreme Court in its landmark judgment of Prakash Singh vs Union of India (2006), gave below directions
to Central govt. and State govts. to make structural changes in police, to insulate police from external
pressures and to make police accountable to people:
 National Security Commission (NSC)
 State Security Commission (SSC)
 Police Establishment Board (PEB)
 Police Complaints Authority (PCA)
 Fixation of minimum tenure
 Separation of roles between investigation and law & order
• Judiciary had also advised for use of:
 “scientific” police investigations
 video recording of investigations
Page 613 of 719
  techniques such as Narcoanalysis etc., with video recording.
 Closed-Circuit Television (CCTV) cameras inside police stations.
 SMART policing:
• Strict & Sensitive
• Modern & Mobile
• Alert & Accountable
• Reliable & Responsive
• Techno-savvy & Trained
 Way Forward:
• Additional funding and training. Improving soft skills and ensuring investigation in impartial manner.
Unwanted and mechanical arrests need to be stopped. More offences can be made bailable and more
brought under ambit of compounding to lighten burden on jails. Use of technology and forensic techniques
must be encouraged to enhance quality of evidence. Specialised wings need to be established to deal with
newer types of crime.
→ Conclusion:
 Police should be accountable only for their constitutional goal of establishing rule of law.
 Offences against state:
→ It includes cases booked under: sedition; Unlawful Activities (Prevention) Act (UAPA), 1967; Official Secrets Act, 1923;
damage to public property; accusation, assertions prejudicial to national integration.
 Gait:
→ What:
 Gait is defined as manner of walking or moving on foot.
→ Gait analysis:
 What:
• Technique in podiatry medical care and treatment of foot, which is used to evaluate and diagnose conditions
that affect walking and posture.
• Gait analysis is systematic study of animal locomotion, more specifically study of human motion, using eye
and brain of observers, augmented by instrumentation for measuring body movements, body mechanics,
and activity of muscles.
• Gait analysis is process where person’s manner of walking is compared with CCTV camera footage of him.
 Feature:
• This study encompasses quantification (introduction and analysis of measurable parameters of gaits), as
well as interpretation, i.e. drawing various conclusions about animal (health, age, size, weight, speed etc.)
from its gait pattern.
 Usage:
• Gait analysis is used to assess and treat individuals with conditions affecting their ability to walk.
• It is also commonly used in sports biomechanics to help athletes run more efficiently and to identify posture-
related or movement-related problems in people with injuries.
• Gait analysis techniques are now borrowed by forensic sciences experts to identify suspects in criminal
cases.
 Forensic science / criminalistics:
→ What:
 It is application of science to criminal and civil laws, mainly — on criminal side — during criminal investigation,
as governed by legal standards of admissible evidence and criminal procedure. Forensic science is broad field
that includes; DNA analysis, fingerprint analysis, blood stain pattern analysis, firearms examination and ballistics,
tool mark analysis, serology, toxicology, hair and fiber analysis, entomology, questioned documents,
anthropology, odontology, pathology, epidemiology, footwear and tire tread analysis, drug chemistry, paint and
glass analysis, digital audio video and photo analysis.
 Forensic Investigation: It is act of utilizing science to establish facts or evidence which is to be used for crime-
based trials or proceedings.
→ How:
 Forensic scientists collect, preserve, and analyze scientific evidence during course of investigation. While some
forensic scientists travel to scene of crime to collect evidence themselves, others occupy laboratory role,
performing analysis on objects brought to them by other individuals. Still others are involved in analysis of
financial, banking, or other numerical data for use in financial crime investigation, and can be employed as
consultants from private firms, academia, or as government employees.
 In addition to their laboratory role, forensic scientists testify as expert witnesses in both criminal and civil cases
and can work for either prosecution or defense.
→ Forensic Evidence:

Page 614 of 719

  Any evidence which can make investigators identify criminal easily amounts. Some major categories of forensic
evidence are DNA, fingerprints, bloodstain pattern analysis. Forensic evidence is useful in helping solve most
violent and brutal of cases, as well as completely non-violent cases related to crimes such as fraud, hacking.
 Initiative:
→ NCRB. Cri-MAC portal.
Note:
 National Crime Records Bureau (NCRB) [1986]:
→ What:
 Indian government agency responsible for collecting and analysing crime data as defined by Indian Penal Code
(IPC) and Special and Local Laws (SLL).
 headquartered - New Delhi
 Director is IPS officer
 under Ministry of Home Affairs (MHA)
 NCRB brings out annual comprehensive statistics of crime across India – “Crime in India” report - serves as crucial
tool in understanding law and order situation across India.
→ Origin:
 based on recommendations of National Police Commission (1977-81) and MHA’s Task Force (1985).
→ Function:
 to function as repository of information on crime and criminals [to assist investigators in linking crime to
perpetrators].
 collecting and analysing crime data as defined by Indian Penal Code (IPC) and Special and Local Laws (SLL).
 NCRB looks after CCTNS and Central Finger Print Bureau.
→ Reports / publication:
 Accidental Deaths & Suicides in India (ADSI) report [1967]:
• Data for report is collected by State Crime Records Bureaux (SCRBx) from District Crime Records Bureaux
(DCRBx) and sent to NCRB at end of year under reference. Data from mega-cities (cities having population
of 10 lakh or more as per latest census) is also collected separately.
• It is published year wise.
 “Crime in India”:
• It contains data on crime against women, offences against state etc.
 Prison Statistics India.
 Finger Prints in India.
 Cri-MAC [2020]:
→ Central government’s online platform, run by NCRB, meant to share information and coordinate action among law
enforcement agencies on serious criminal incidents, including human trafficking.
→ Issues: Several States have not updated and reported 0 alerts on Cri-Mac.
 Scene of Crime Officer [Karnataka]:
→ Who:
 Crime scene officer, specialists of forensic science, identification, collection, preservation of evidence at scene
of crime.
 Central Forensic Science Laboratory (CFSL):
→ What:
 One wing of Ministry of Home Affairs, which fulfills forensic requirements in India. There are 7 central forensic
laboratories in India at - Hyderabad, Kolkata, Chandigarh, New Delhi, Guwahati, Bhopal, Pune.
→ Locations:
 CFSL Hyderabad: It is one centre of excellence in chemical sciences.
 CFSL Kolkata: It is oldest laboratory in India and in biological sciences.
 CFSL Chandigarh: It is in physical sciences.
 CFSL New Delhi: It comes under CBI, Delhi and investigates cases on its behalf, whereas other laboratories are
under control of Directorate of Forensic Science Services (DFSS) of Ministry of Home Affairs.
→ Function:
 To provide scientific opinion on different types of evidential material referred to by investigating agencies and
help judiciary.
→ Significance:
 Their reports were used in many high-profile cases, including 1993 serial bomb blasts in Bombay, cases related
to 2006 train blasts, 2011 serial blasts in Mumbai.
 These are used specially in murder, rape cases etc.

 “Prison Statistics India”:

→ Report released by NCRB.
→ PSI 2021:
Page 615 of 719
  Finding:
• India has many overcrowded prisons (over 130% occupancy). Undertrials are 77%. About 67% of inmates
belong to SC, ST, OBC communities. Highest number of UTPs: UP > Bihar > MH. Most prisons, including in
Delhi, don’t have separate facilities for transgender.
Value Addition:
 Crime scene evidence collection system already exists in developed countries.
 In 1961, in London, 1st crime scene officer post was created.
Mains Link:
 Throw a light on suicide rates in India based on the recent report published by the NCRB and suggest ways to minimise
these numbers.
 Examine the causes of high rate of road accidents in India in comparison to other countries. (15M)

UNLAWFUL ACTIVITIES (PREVENTION) ACT, 1967 / UAPA, 1967

News:
 2021:
→ Delhi High Court lays down some important principles of UAPA Act, 1967.
 Implication:
• Delhi High Court has raised bar for State to book individual for terrorism under UAPA, 1967.
• Delhi High Court points out alleged misuse of UAPA, 1967 against individuals in cases that do not
necessarily fall in category of “terrorism” cases.
• Delhi High Court’s caution is significant given sharp increase in States’ use of UAPA, 1967 like:
 tribals in Chhattisgarh
 people using social media in JK
 journalists in Manipur etc.
→ In accordance with Union government’s policy of zero tolerance against terrorism, ban under UAPA may be
imposed on secessionist group - Hurriyat Conference which has been spearheading separatist movement in
Jammu & Kashmir for decades.
→ NCRB releases data on offences against state.
→ Office of United Nations High Commissioner for Human Rights expressed its concerns over ongoing use of Unlawful
Activities (Prevention) Act, 1967 throughout India and said situation as ‘worrying’.
 Office of United Nations High Commissioner for Human Rights says Jammu & Kashmir has highest number of
cases registered under UAPAacross India.
 It also flagged concerns regarding Journalists put under detention for exercising their right to freedom of
expression.
 However, it does acknowledge Government’s efforts to counter terrorism, promote development in JK region.
But, also cautioned that such restrictive measures can result in human rights violations, tensions, discontent.
→ Former Supreme Court judge R. Nariman calls Unlawful Activities (Prevention) Act, 1967 draconian
legislation that requires to be scrutinised by apex court. Nariman also urged top court to strike down
offensive parts of Unlawful Activities (Prevention) Act, 1967 (UAPA).
→ Students in Srinagar who led celebrations (singing Pakistan’s anthem on premises of Indian institution) of
Pakistan’s victory over India in 2021 T20 World Cup cricket match charged under Unlawful Activities
(Prevention) Act, 1967.
→ Some lawyers and journalists in Tripura booked under UAPA in c/w targeted violence in Tripura.
→ Union Home Ministry reports to Lok Sabha that about 55% of people arrested in India under Unlawful
Activities (Prevention) Act, 1967 are below 30 years of age. [Uttar Pradesh accounted for highest arres ts].
 2022:
→ Supreme Court pulls up Tripura Police and Tripura government for repeated notices under UAPA sent to
journalists, activists, people who tweeted on alleged violence in Tripura State.
→ One Sessions Court in Delhi denies bail to one accused persons namely Khalid, chargesheeted under UAPA,
as part of 2020 Delhi riots cases.
→ One Special NIA court sentences Yasin Malik (Kashmiri separatist leader and former militant who advocates
separation of Kashmir from both India and Pakistan) to life imprisonment in one terror funding case. NIA court
charged him to life term under Unlawful Activities (Prevention) Act, 1967 and under Section 121 IPC and also imposed
fine of Rs. 10 lakh.
→ Amnesty International says journalists, activists continue to be targeted in J&K. Amnesty International says it had
recorded at least 60 instances of crackdowns on journalists and human rights defenders in Jammu and Kashmir since
revocation of special status of erstwhile JK State in 2019. In one report titled “We are being punished by law: 3 years
since abrogation of Article 370 in Jammu & Kashmir”, Amnesty International documents interrogations, travel bans,
and detentions of journalists and human rights defenders. This report reviewed 1,346 cases on website of Jammu
and Kashmir High Court. In continuing pattern, they have been arrested under one law, granted bail by court, and
then re-arrested almost immediately under UAPA, 1967.

Page 616 of 719

 → Addressing the 1st Chintan Shivir (brainstorming session) of State Home Ministers and top police officers, Prime
Minister Narendra Modi says that Central laws such as the UAPA has given an impetus (encouragement) to the
system in a decisive fight against terrorism.
About:
 What:
→ Act to provide for more effective prevention of certain unlawful activities of individuals and associations,
and for dealing with terrorist activities. anti-terror law. It is one Parliamentary law of India that gives powers
to GOI to deal with activities directed against integrity and sovereignty of India.
 Aim:
→ prevention of unlawful activities associations in India.
 Provisions:
→ assigns absolute power to central government in declaring activity, any association as unlawful.
→ list of offences:
 terrorist act
 secession and cession of territory.
→ can declare unlawful both:
 Organizations
 individuals
→ can ban unlawful organizations.
→ can designate individuals as terrorists [by 2019 amendment]
→ both Indian and foreign nationals can be charged.
→ has jurisdiction even if crime is committed on foreign land, outside India.
→ investigating agency can file charge sheet in maximum 180 days after arrests and duration can be extended
further after intimating court.
→ highest punishments - death penalty, life imprisonment.
 Judiciary:
→ 1994 Supreme Court Vishnu Thakur Judgment:
 Every terrorist may be criminal but every criminal cannot be labelled terrorist.
 Terrorist activity is that which travels beyond capacity of law enforcement agencies under ordinary
penal law.
→ 2021 Delhi High Court:
 “Terrorist Act” should not be used lightly.
 Terrorist acts are not equal to usual law & order problem.
 “Terrorist Act” shall not be casually applied to cases falling within conventional offences under IPC.
 Criticisms:
→ UAPA gives absolute and sweeping powers to GOI to arrest individuals indulging in activity it considers
unlawful.
→ Courts are bound to give stringent punishment under UAPA evenif offence is not serious.
→ Critics point to 2019 Crime in India Report by NCRB, which says only about 2% of total cases registered
under UAPA, 1967 in last 4 to 5 years are given convictions by Trial Courts.
→ Critics argue about vague and wide definition given to what amounts to “unlawful activity” under UAPA.
This definition gives free hand to State to crush dissent and free speech with threat of UAPA.
→ Critics argue Anticipatory Bail (AB) is barred under UAPA and possibility of bail is less.
→ civil society argues UAPA is against constitutional freedom to dissent, rule of law, fair trial.
→ Vague definition of terrorist act.
→ Denial of bail.
→ Pendency of trials.
→ State overreach.
→ Undermines federalism.
→ misuse and abuse.
→ Could brand political opponents and civil society activists as terrorists.
→ unrestricted powers to investigating agencies.
→ against the federal structure, given that ‘Police’ is state subject.
 Way Forward:
→ Anti-terror laws should not be used as tool to silence critics of government.
→ committee may be set up.
→ check of arbitrariness through Judicial review.
 Fact:
→ For prosecuting accused under Unlawful Activities (Prevention) Act, 1967 and certain other scheduled
offenses, NIA seeks sanction of Central Government.
Note:
Page 617 of 719
  2019 UAPA amendment:
→ Director General of NIA is empowered to grant approval of seizure or attachment of property when case is
investigated by NIA.
→ Officers of NIA, of rank of Inspector or above, is empowered to investigate cases of terrorism in addition to those
conducted by DSP or ACP or above rank officer in State.
→ Individual can be designated as terrorist.
 Section 121 IPC (Waging, or attempting to wage war, or abetting waging of war, against Government of India):
→ Whoever, wages war against Government of India, or attempts to wage such war, or abets waging of such war, shall
be punished with death, or imprisonment for life and shall also be liable to fine.
 Offences against state:
→ It includes cases booked under:
 sedition
 Unlawful Activities (Prevention) Act (UAPA), 1967
 Official Secrets Act, 1923
 damage to public property
 accusation, assertions prejudicial to national integration.
Value Addition:
 UN Convention against Transnational Organized Crime:
→ main international instrument in fight against transnational organized crime.
Mains link:
 The National Investigation Agency (NIA) has been at forefront to investigate and prosecute offenses under UAPA. What
are the impediments in its effective functioning?
 Do you agree that the Unlawful Activities (Prevention) Amendment Act could prove catastrophic for fundamental rights?
Is sacrificing liberty for national security justified? Discuss and provide for your opinion.

MICRO, SMALL AND MEDIUM ENTERPRISE (MSME) / UDYAM

News:
 2021:
→ Ministry of Corporate Affairs expands turnover and borrowing thresholds for Small and Medium sized
Companies (SMC).
 Significance: This move would promote ease of doing business for SMC firms.
 2022:
→ Ministry of MSME says:
 Maharashtra tops in number of MSME owned by entrepreneurs from Scheduled Castes.
 Proportion of enterprises owned by Scheduled Caste entrepreneurs in overall national tally of MSMEs is 6%.
→ Union Cabinet approves about Rs. 6,000 crore World Bank assisted programme - “Raising and Accelerating
MSME Performance” (RAMP).
→ PM Modi participates in 'Udyami Bharat' programme and launches 'Raising and Accelerating MSME
Performance' (RAMP) scheme, 'Capacity Building of First-Time MSME Exporters' (CBFTE) scheme and new
features of 'Prime Minister's Employment Generation Programme' (PMEGP).
→ Finance Minister Nirmala Sitharaman says GOI would take adequate measures to clear pending dues to
MSMEs and would ensure that the central government departments and CPSEs make payments to the
MSMEs in 90 days.
→ Centre directs 36% of defaulter CPSEs to join TReDS platform: Finance Ministry directs 92 operating central
public sector enterprises (CPSEs) that have not onboarded the Trade Receivables Discounting System
(TReDS) despite the government’s mandate to do so. [GOI mandated in 2017 that all CPSEs get registered
on the TReDS]. [Last month, Finance Minister Nirmala Sitharaman said GOI would take adequate measures
to clear pending dues to MSMEs and would ensure that the central government departments and CPSEs
make payments to the MSMEs in 90 days].
About:
 What:
→ under MoMSME.
 Fact:
→ India has about 63.4 million MSME units throughout geographical expanse of country.
→ MSME is included in Priority Sector.
→ One function of Software Technology Parks of India (STPI) is to promote MSMEs in field of IT / ITES.
→ MSME sector is included in Atmanirbhar Bharat Abhiyan (Self-Reliant India Mission).
→ ECLGS, 2020 provides credit to different sectors, especially MSMEs.
→ MSMEs is included in Production Linked Incentive (PLI) Scheme.
→ NITI Aayog and Mastercard’s 2021 report on Digitally Inclusive Bharat has provision for digitizing
registration and compliance processes of MSMEs so as to enable growth of MSMEs.

Page 618 of 719

 → Maharashtra – tops India’s list in number of MSME owned by entrepreneurs from SC with as many as
96,805 enterprises
 Classification:
→ Basic criteria is on investment in plant, machinery, equipment, turnover.
→
Micro Small Medium
Investment in Plant and Machinery Investment in Plant and Machinery Investment in Plant and Machinery
or Equipment: or Equipment: or Equipment:
Not more than Rs.1 crore and Not more than Rs.10 crore and Not more than Rs.50 crore and
Annual Turnover ; not more than Rs. Annual Turnover ; not more than Rs. Annual Turnover ; not more than Rs.
5 crore 50 crore 250 crore
 MSME registration in India:
→ MSME registration / Udyam registrationis pre-requisite for any MSME to avail itself of concessions or
benefits from Central and State governments.
→ Registration can be filed online based on self-declaration. [Uploading of documents, papers, certificate as
proof is not necessary].
→ Champions Control Room across India are responsible for facilitating entr epreneurs in registration.
 MSME share in India:
→ India has about 6.3 crore MSMEs
→ 20% of India’s MSMEs are based out of rural areas.
 Initiative:
→ MUDRA Yojana
→ ECLGS
→ Scheme of Fund for Regeneration of Traditional Industries (SFURTI)
→ National MSME Awards:
→ Raising and Accelerating MSME Performance (RAMP) [2022]:
→ Capacity Building of First-Time MSME Exporters (CBFTE) scheme [2022]:
→ Trade Receivables Discounting System (TReDS).
 Significance:
→ MSMEs are backbone of Indian economy.
→ India’s MSMEs have always played vital role in Indian economy.
→ India’s MSMEs contribute 24.63% to GDP of India.
→ India’s MSMEs also provide employment to large sections of society about 120 million Indians.
→ India’s MSME sector is critical source of livelihood and provides ne arly 110 million jobs.
→ India’s MSMEs contribute around 6.11% of manufacturing GDP.
→ India’s MSMEs contribute around 45% of overall exports from India.
→ 20% of India’s MSMEs are based out of rural areas, which indicates deployment of significant rural
workforce in MSME sector.
 Way Forward:
→ If MSME segment kicks off, overall manufacturing sector will get boost, which will benefit ‘Make in India’ scheme.
Manufacturing policy of India should target labour-intensive firms - informal sector, MSMEs etc.
Note:
 National MSME Awards:
→ These awards are recognition of contributions of MSMEs, States / UTs, aspirational districts and banks for their
outstanding performance in growth and development of India's dynamic MSME sector.
 Raising and Accelerating MSME Performance (RAMP) [2022]:
→ What:
 RAMP aims to scale up implementation capacity and coverage of MSMEs in States, with impact enhancement of
existing MSME schemes. It will complement Aatmanirbhar Bharat Abhiyan by fostering innovation, encouraging
ideation, incubating new business and entrepreneurship by developing quality standards, improving practices
and processes, enhancing market access, deploying technological tools and Industry 4.0 to make MSMEs
competitive and self-reliant.
 World Bank assisted Central Sector Scheme.
 formulated and proposed by Government of India
 launched to support various Resilience and Recovery Interventions of MSME Enterprises, for strengthening
MSMEs.
→ Background:
 Recommended by U K Sinha Committee, KV Kamath Committee, Economic Advisory Council to Prime Minister
(PMEAC).
→ Objective:
 improving access to market and credit
Page 619 of 719
  strengthening institutions and governance at Centre and State
 improving Centre-State linkages and partnerships
 addressing issues of delayed payments and greening of MSMEs.
→ Need:
 40% of MSMEs in India lack access to finance.
→ Function:
 building Min. of MSME’s capacity at national level
 scale up implementation capacity and MSME coverage in States.
 Act as ‘’Policy Provider’’ through enhanced capacity for evidence-based policy and program design, to enable
delivery of more effective and cost-efficient MSME interventions to improve competitiveness and business
sustainability.
 Act as “Knowledge Provider” through bench-marking, sharing and demonstrating best practices/success stories
by leveraging international experiences.
 Act as “Technology Provider” by providing access to high-end technology resulting in digital and technological
transformation of MSMEs through state of art AI, Data Analytics, Internet of things (IoT), Machine Learning etc.
→ Significance:
 RAMP programme with impact across India directly or indirectly and will benefit almost all million enterprises
that qualify as MSMEs.
 Capacity Building of First-Time MSME Exporters (CBFTE) scheme [2022]:
→ It aims to encourage MSMEs to offer products and services of international standards for global market. This will
enhance participation of Indian MSMEs in global value chain and help them realise their export potential.
 Trade Receivables Discounting System (TReDS):
→ What:
 TReDS is an electronic platform for facilitating the financing / discounting of trade receivables of MSMEs through
multiple financiers. These receivables can be due from corporates and other buyers, including Government
Departments and Public Sector Undertakings (PSUs).
 TReDS is a payment system authorised under Payment and Settlement Systems Act, 2007. It is a platform for
uploading, accepting, discounting, trading and settling invoices / bills of MSMEs and facilitating both receivables
as well as payables factoring (reverse factoring).
 It is a platform for setting up and operating the institutional mechanism for facilitating the financing of trade
receivables of MSMEs from corporate and other buyers, including Government Departments and Public Sector
Undertakings (PSUs), through multiple financiers.
 TReDS is an institutional mechanism set up to facilitate the discounting of invoices for MSMEs from CPSE and
corporate buyers through multiple financiers.
→ Background:
 MSMEs play an important role in the economic fabric of India. The sector had been facing constraints in obtaining
adequate finance, particularly in terms of their ability to convert their trade receivables into liquid funds. To
address this pan-India issue, setting up of and operating TReDS was conceptualised.
→ Purpose:
 MSME receives order but payment for the order is made only on delivery of the order. Meanwhile, they need
capital to produce the order. Also, delayed payments by the public (CPSEs) and private organizations result in a
shortage of working capital for the MSMEs in their regular business operations. That’s where TReDs comes in.
Through this, MSMEs get instant short-term capital but at a discounted rate based on the invoices.
→ Feature:
 MSME sellers, corporate and other buyers, including Government Departments and PSUs, and financiers (banks,
NBFC-Factors and other financial institutions, as permitted) are direct participants in the TReDS and all
transactions processed under this system are '"without recourse" to MSMEs.
 Only MSMEs can participate as sellers in TReDS.
 Corporates, Government Departments, PSUs and any other entity can participate as buyers in TReDS.
 Banks, NBFC - Factors and other financial institutions as permitted by RBI, can participate as financiers in TReDS.
 There are currently 3 TReDS based portals: RXIL (Receivables Exchange of India Ltd.), M1Xchange, and
Invoicemart.
→ How does it work?
 Invoice discounting is the working principle of TReDS. This involves 3 participants — MSME supplier, corporate
/ CPSE buyer, and financier. The process is as follows:
• Apply: MSME lists trade receivables invoices (capital due from corporate) on TReDS based portal.
• Transfer: A corporate / listed financier on TReDS platform acquires the invoice at a discounted rate via
competitive bidding.
• Payment: MSME receives immediate capital at some discount on the invoice. Financier gets the right to
collect on the full invoice amount at maturity.
Glossary:
Page 620 of 719
  Central Public Sector Enterprises (CPSE):
→ CPSEs are those companies in which the direct holding of GOI or other CPSEs is 51% or more. Department
of Public Enterprises (Ministry of Finance) is the nodal agency for policies relating to CPSEs.
Mains Link:
 What is the potential of India’s MSME sector? Discuss the challenges and concerns associated with the growth of MSME
sector in India.

UNITED NATIONS ENVIRONMENT PROGRAMME (UNEP) [1972]

News:
 2021:
→ UNEP says use of leaded petrol eradicated from globe.
→ UNEP latest Production Gap Report reveals that many top fossil fuel producing countries, including India, are not
prepared to meet requirements of 2015 Paris Climate Agreement.
 2022:
→ UNEP is celebrating its 50th anniversary in 2022.
→ UNEP releases its latest Frontiers report.
→ One resolution at 2022 UN Environment Assembly (UNEA) held in Nairobi, hosted by UNEP, seeks to end plastic
pollution and create one international legally binding agreement by 2024.
 Significance:
• This resolution will be related to marine ecosystems also, and will include both binding and voluntary
approaches from member states.
• This development is considered most important environmental deal since 2015 Paris Agreement.
→ 50th anniversary of Stockholm conference observed.
→ UNEP, along with Reef-World Foundation (UK-based charity), launches Green Fins Hub, one global digital platform
aiming to boost sustainable marine tourism. Green Fins Hub will help diving and snorkelling operators worldwide to
make simple, cost-efficient changes to their daily practices by utilising tried and tested solutions. It would also help
them keep track of their annual improvements and communicate with their communities and customers.
→ According to Emissions Gap Report 2022, current pledges by countries for reducing GHG emissions would still leave
the world warmer by 2.4-2.6 degrees celsius by the end of the century. This report finds that the international
community is falling far short of the Paris goals, with no credible pathway to 1.5°C in place. And that only an urgent
system-wide transformation can avoid climate disaster.
About:
 What:
→ leading global environmental authority that sets global environmental agenda, promotes coherent implementation
of environmental dimension of sustainable development within UN system, and serves as authoritative advocate for
global environment.
→ leading global voice on environment.
→ Headquarter - Nairobi, Kenya
→ following landmark 1972 UN Conference on Human Environment (Stockholm Conference).
→ Created to monitor state of environment, inform policy making with science and coordinate responses to world’s
environmental challenges.
 Aim:
→ to provide leadership
→ encourage partnership
→ inspiring, informing, enabling nations, peoples to improve their quality of life without compromising that of future
generations.
 Focus areas:
→ climate change
→ disasters and conflicts
→ ecosystem management
→ environmental governance,
→ chemicals and waste
→ resource efficiency
→ environment under review
 Funding:
→ by voluntary contributions of its members
 Functions:
→ UNEP hosts secretariats of many critical multilateral environmental agreements and research bodies (bringing
together nations and environmental community):
 Convention on Biological Diversity (CBD)
 Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES)

Page 621 of 719

  Minamata Convention on Mercury
 Basel Convention, Rotterdam Convention and Stockholm Convention
 Vienna Convention for Protection of Ozone Layer and Montreal Protocol
 Convention on Migratory Species (CMS)
 Carpathian Convention
 Bamako Convention
 Tehran Convention
 Reports:
→ Emission Gap Report
→ Global Environment Outlook
→ Frontiers
→ Invest into Healthy Planet
→ ….
 Campaigns:
→ Beat Pollution
→ UN75
→ World Environment Day
→ Wild for Life
→ ….
 Milestones and timeline (UNEP’s history and how UNEP helped shape 5 decades of environmental milestones):
→ 1973: Leaders sign Convention for Prevention of Pollution from Ships (MARPOL). This treaty imposes strict rules on
shipping industry, helping to prevent spills and pollution from routine operations. This treaty is administered by the
nternational Maritime Organization (IMO), which would become key partner in UNEP efforts to prevent marine
pollution.
→ 1973: States adopt Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) -
cornerstone of international conservation efforts. This accord would come to regulate, and in some cases ban, trade
of more animals and plants, including some of planet’s most endangered species. CITES became UNEP-administered
multilateral environmental agreement in 1984.
→ 1974: World Environment Day makes its debut. World celebrates 1 st World Environment Day organized by UNEP.
Since then, commemorated annually, WED has been raising awareness about critical environmental issues, and
galvanizing action and commitment from member states.
→ 1974: Regional Seas Programme established. This programme, once described as one of "crown jewels" of
environmental diplomacy, brings neighbouring countries together to reduce ocean pollution and protect marine life.
Today, more than 143 states participate in 13 regional seas programmes, which stretch from Mediterranean to
Caribbean to South Pacific. This programme coordinates action to protect marine biodiversity, by providing platform
to strengthen regional dialogue and partnerships. It also helps enhance science-based decision making on marine
and coastal issues.
→ 1976: Governments adopt Convention for Protection of Mediterranean Sea Against Pollution (Barcelona
Convention). This Barcelona Convention was amended later and renamed as Convention for Protection of Marine
Environment and Coastal Region of Mediterranean.
→ 1979: States adopt Convention on Migratory Species (Bonn Convention). This accord provides global platform for
conservation of migratory animals and their habitats. It would come to protect more than 600 creatures, from great
white sharks to monarch butterflies.
→ 1980: World Conservation Strategy launched. This document is among 1 st to define concept of sustainable
development, idea that needs of today shouldn’t compromise needs of future generations. This concept would come
to underpin much of work of UN. This strategy is partnership between UNEP, IUCN, WWF.
→ 1982: UNEP adopts Montevideo Programme. This programme would set priorities for global environmental
lawmaking and lead to major agreements, including Basel, Stockholm and Rotterdam conventions, and Montreal
Protocol. It supports 120 governments in developing environmental legislation.
→ 1988: UNEP and World Meteorological Organization (WMO) launches Intergovernmental Panel on Climate Change
(IPCC). IPCC aims to provide governments with scientific information that they can use to develop climate policies.
→ 1991: UNEP, UNDP, World Bank establish Global Environment Facility (GEF). GEF will help tackle planet’s most
pressing environmental problems.
→ 1997: UNEP releases 1st Global Environment Outlook, holds Earth Summit+5. Global Environment Outlook presents
clear assessment of state of environment and outlines biggest challenges facing planet. As well, 5 years after meeting
in 1992 Rio, Member States review state of environment at Earth Summit+5 in New York.
→ 2005: UNEP launches Champions of Earth. This is UN’s highest environmental honour that recognizes outstanding
leaders from government, civil society, private sector whose actions have transformative impact on environment.
→ 2008: UNEP becomes carbon-neutral. UNEP announces to reduce emissions by 3% every year and commits to buying
carbon credits to compensate for its remaining emissions in order to achieve carbon neutrality.

Page 622 of 719

 → 2010: UNEP releases 1st Emissions Gap Report. This is landmark science-based assessment that charts gap between
countries’ pledges on greenhouse gas emissions and reductions required to deliver global temperature increase of
below 2˚C by end of this century.
→ 2014: Officials unite for 1st UN Environment Assembly (UNEA) wich is bi-annual event, convened by UNEP. UNEA has
since become world's highest-level decision-making body on environment, with universal membership of all 193
Member States.
→ 2016: UNEP unveils Frontiers Report. This report identifies emerging environmental issues and emphasizes link
between human and planetary health, providing recommendations on how critical environmental problems can be
addressed through innovation and policy interventions. In 2016 itself, it identifies zoonotic diseases as emerging
issue of global concern, 4 years ahead of COVID-19 pandemic.
→ 2019: UNEP launches inaugural Environmental Rule of Law report. 1st global assessment of its kind, this report offers
framework for addressing gap between environmental laws and their application. This report is seen as key to
achieving SDGs.
→ 2021: UNEP releases Making Peace with Nature Report. This report offers scientific blueprint on how to tackle triple
planetary crises of:
 climate change
 biodiversity loss
 pollution.
→ 2022: UNEP@50 anniversary event. In March, 2022, Member States and other stakeholders will commemorate
UNEP’s 50th anniversary. This event will provide opportunity to strengthen UNEP organization by positioning it at
forefront of revamped global multilateral environmental system.
→ 2022: Stockhom+50 international meeting. In Jun, 2022, leaders will come together in Sweden for “Stockholm+50
gathering. This event will commemorate 50 years since 1972 UN Conference on Human Environment.
 Achievements:
→ UNEP works closely with its 193 Member States, other stakeholders to galvanize worldwide commitments and
coordinated action to address many of world’s most pressing environmental challenges.
→ UNEP played leading role as docking station for 15 multilateral environmental agreements.
 Environment Assembly / UN Environment Assembly / UNEA [2012]:
→ UNEP's governing body.
→ world’s highest-level decision-making body on environment.
→ currently has 193 UN members.
→ meets every two years.
→ Functions to advance global environmental governance.
→ created in 2012, during UN Conference on Sustainable Development / RIO+20.
Note:
 Frontiers [2016]:
→ report released by UNEP
→ annual
→ draws attention to emerging issues of environmental concern.
→ 2022 Frontiers:
 Focus areas:
• Urban noise pollution
• Wildfires
• phenological shifts.
These 3 topics highlight urgent need to address triple planetary crisis (climate change, pollution, biodiversity
loss).
 Highlight:
• Dhaka- noisiest city in world, followed by Moradabad (in Uttar Pradesh).
• 5 Indian cities are among noisiest cities of world –Asansol (WB), Jaipur, Kolkata, New Delhi, Moradabad
(UP).
• Irbid (in Jordan) - world’s quietest city, followed by Lyon (in France), Madrid (Spain).
• Wildfires are predicted to worsen in coming years and decades due to rising concentrations of atmospheric
greenhouse gases (GHG). Wild land-urban interface, where there has been rapid expansion of cities towards
forest areas in many regions, is area where wildfire risks are most. For example, rising fires in California,
United States.
• Lightning: with rising forest fires, world is very likely to see more frequent incidences of lightning.Fire-
induced thunderstorms are new danger posed by rising wildfires. Fire-induced thunderstorms contribute to
more dangerous conditions for fires on ground.
• Noise pollution in cities is growing hazard to public health. For example - wnwanted, prolonged, high-level
sounds from road traffic, railways, leisure activities impair human health and well-being.

Page 623 of 719

 • Phenological shifts occur when species shift timing of life cycle stages in response to changing
environmental conditions altered by climate change. Concern is that interacting species in ecosystem do
not always shift timing in same direction or at same rate.These phenological shifts are increasingly disturbed
by climate change, and thus pushing plants and animals out of synch with their natural rhythms and leading
to mismatches, such as when plants shift life cycle stages faster than herbivores.
 Recommendations:
• Increase vegetation in urban environments.
• Provide soundscape planning.
• Noise barriers along highways or railways.
• Preventive approach by engaging vulnerable groups.
• Appreciating and adopting indigenous fire management techniques.
• Focus on long-range weather forecasting and remote-sensing capabilities like satellites.
• Increase ecological connectivity through habitat corridors.
• Promoting genetic diversity and increasing chances of successful adaptation.
 Phenology:
→ study of periodic events in biological life cycles and how these are influenced by seasonal and interannual variations
in climate, habitat factors (like elevation).
→ timing of recurring life cycle stages, driven by environmental forces, and how, within ecosystem, interacting species
respond to changing conditions. That is, plants and animals in terrestrial, aquatic and marine ecosystems use
temperature, day-length or rainfall as cues for when to unfold leaf, flower, bear fruit, breed, nestle, pollinate, migrate
or transform in other ways.
 United Nations Conference on Human Environment [1972] / 1972 Stockholm Conference:
→ What:
 This Conference was held in Stockholm, Sweden in 1972.
 It was 1 st such worldwide convergence on planetary environment, with theme ‘Only One Earth’.
 It is also known as Swedish Initiative because in 1968 Sweden 1 st proposed idea of Stockholm
conference.
→ Feature:
 Its 3 dimensions were:
• Countries agreeing not to harm each other’s environment or areas beyond national jurisdiction.
• One action plan to study threat to Earth’s environment.
• Establishment of one international body called United Nations Environment Programme (UNEP) to bring in
cooperation among countries.
→ Significance and outcomes:
 It resulted in Stockholm Declaration which contained principles and one Action Plan containing
recommendations for environmental policy.
 Until 1972, no country had Environment Ministry. Example, Norwegian delegates returned from this
conference to set up Ministry for Environment.
 India set up its Ministry of Environment and Forest in 1985.
 UNEP was created as result of this Stockholm conference.
 World Environment Day (WED) [1972]:
→ What:
 WED is celebrated annually on 5 June and is UN's principal vehicle for encouraging awareness and
action for protection of environment.
 WED is one global platform for public outreach, with participation from over 143 countries annually.
 It is one platform for raising awareness on environmen tal issues as marine pollution, overpopulation,
global warming, sustainable development and wildlife crime.
 Each year, WED program provides one theme and forum for businesses, non -government
organizations, communities, governments and celebrities to advoca te environmental causes.
→ Origin:
 UN Stockholm Conference on Human Environment [1972].
→ 2021 World Environment Day:
 2021 Theme: ‘Reimagine. Recreate. Restore.’
 Emissions Gap Report:
→ It is released by UNEP. In 2010, UNEP released its 1st Emissions Gap Report. This is landmark science-based
assessment that charts gap between countries’ pledges on GHG emissions and reductions required to deliver global
temperature increase of below 2˚C by end of this century.
→ Emissions Gap Report 2022:
 It is an overview of the difference between where GHG emissions are predicted to be in 2030 and where they
should be to avert the worst impacts of climate change.

Page 624 of 719

  It provides an overview of, Emissions Gap, the difference between where GHG emissions are predicted to be in
2030 and where they should be to avert the worst impacts of climate change.
 This 2022 report shows that updated national pledges since COP26 – held in 2021 in Glasgow, UK – make a
negligible difference to predicted 2030 emissions and that we are far from the Paris Agreement goal of limiting
global warming to well below 2°C, preferably 1.5°C. Policies currently in place point to a 2.8°C temperature rise
by the end of the century. Implementation of the current pledges will only reduce this to a 2.4 - 2.6°C
temperature rise by the end of the century, for conditional and unconditional pledges respectively.
 This 2022 report finds that only an urgent system-wide transformation can deliver the enormous cuts needed
to limit GHG emissions by 2030: 45% compared with projections based on policies currently in place to get on
track to 1.5°C and 30% for 2°C.
This 2022 report provides an in-depth exploration of how to deliver this transformation, looking at the
required actions in the electricity supply, industry, transport and buildings sectors, and the food and financial
systems.
 Finding:
• The top 7 emitters (China, EU27, India, Indonesia, Brazil, Russia, USA) plus international transport accounted
for 55% of global GHG emissions in 2020.
• Collectively, G20 members are responsible for 75% of global GHG emissions.
• World average per capita GHG emissions: US at 14 tCO2e, followed by Russia, China, Brazil, Indonesia, EU.
India remains far below the world average at 4 tCO2e.
• The updated pledges by countries (NDC) under the Paris Agreement only reduce the projected GHG
emissions by 1% by 2030.
• Current pledges by countries for reducing GHG emissions would still leave the world warmer by 2.4-2.6
degrees celsius by the end of the century.
This will increase the frequency and intensity of extreme weather events, which have already led to
catastrophies. The effect of even 1.1°C warming has been devastating for economies. It would also mean
that many of the climate-tipping elements, essential atmospheric, oceanic and ecosystems responsible for
maintaining life on Earth would cross their tipping points and push the planet into a never-before-seen
environment.
• Updated pledges by countries (NDCs) under 2015 Paris Agreement, only reduced the projected GHG
emissions by 1% by 2030 which is roughly equivalent to 0.5 gigatonnes of CO2.
This is when a 45% reduction is required for the world to limit global warming to 1.5°C above pre-
industrial levels (generally considered to be between 1850 and 1900).
• Climate pledges since the Glasgow COP26 in 2021 have shaved off only less than 1% of projected emissions
till 2030. Whereas we actually need emissions to be slashed by 1/2th by this decade.
• This lack of ambition in reducing GHG emissions means that both the temperature targets under the Paris
Agreement — 2°C and the ambitious 1.5°C — will likely be exceeded by 2100. The planet will be warmer by
2.6°C by the end of the century even if all the current unconditional NDCs, where countries do not need
financial and technical support from other countries, are taken into account. On the other hand, if the
current conditional NDCs, which need external support, are considered, there is a chance of limiting the
warming to 2.4°C.
• Under the best-case scenario in which all the unconditional NDCs and other additional net zero
commitments by countries are fulfilled, there is a chance of limiting the warming to 1.8°C, still above 0.3°C
above the ambitious Paris target. However, the 1.8°C scenario is currently outside the realm of possibility
because of the lack of cohesion between current emissions, short-term NDC targets, and long-term net-zero
targets.
 Recommendation:
• Urgent sector and system-wide transformations — in the electricity supply, industry, transport and buildings
sectors and the food and financial systems — would help to avoid climate disaster.
Mains link
 Throw light on the UNEP’s significance and its role in environmental conservation efforts.

CLIMATE CRISIS / CLIMATE CHANGE / GLOBAL WARMING

News:
 2020:
→ Microsoft announces that it aims to become carbon negative by 2030 and that by 2050, it plans to remove from
atmosphere all carbon that it has emitted since it was founded in 1975. [This is one significant commitment from one
individual company, and it underscores potential for approaches using negative emissions, or carbon dioxide
removal, to play important role in meeting international climate goals].
 2021:
→ Min. of Science & Technology releases National climate vulnerability assessment report .
→ Independent charitable organisation Oxfam said net zero carbon targets that many countries have
announced may be dangerous distraction from priority of cutting carbon emissions.
Page 625 of 719
  Arguments of Oxfam:
• If challenge of climate change is tackled only by way of planting more trees, then about millions of hectares
of new forests would be required to remove world’s excess carbon emissions by year 2050.
• net zero is land-hungry
• It could force many fold rise in global food prices, more hunger while allowing rich nations and corporates
to continue dirty business as usual.
→ UN IPCC releases1 st part of 6 th Assessment Report / sixth Assessment Report on Climate Change.
→ China launches its national carbon emissions trading market / Emissions Trading Scheme (ETS) and
becomes world’s largest emissions trading system, overtaking Emissions T rading Scheme (ETS) of EU.
→ World Bank releases updated “Groundswell” report.
→ UNEP latest Production Gap Report reveals that many top fossil fuel producing countries, including India, are not
prepared to meet requirements of 2015 Paris Climate Agreement.
→ International Air Transport Association (IATA) approved resolution for global air transport industry to
achieve net-zero carbon emissions by 2050. [This commitment will align with Paris Agreement 2015 goal
for global warming not to exceed 1.5°C].
→ In effort to battle climate change, PM Modi made 5-point (Panchamrit) announcements at ongoing COP26
summit in Glasgow, Scotland. [Here at COP26, PM Modi also proposes one global initiative – LiFE
Movement].
→ Germanwatch, New Climate Institute, Climate Action Network released latet - Climate Change Performance
Index.
→ India, Russia block proposal that would have allowed UNSC to deliberate on climate -related issues.
 Reason: India says India is 2nd to none when it comes to climate action and climate justice. But UNSC is not place
to discuss either issue. In fact, attempt to do so appears to be motivated by desire to evade responsibility in
appropriate forum and divert world’s attention from unwillingness to deliver where it counts.
 Way Forward:
• UN already has specialized agency (UNFCCC) for discussing all matters related to climate change.
• Parties to UNFCCC — about 190 countries — meet several times every year to work on global approach to
combat climate change.
• It is UNFCCC that has given rise to 2015 Paris Agreement, and its predecessor 1997 Kyoto Protocol
(international instrument designed to respond to climate change crisis).
 2022:
→ Govt. informs Lok Sabha that under National Adaptation Fund for Climate Change (NAFCC), many projects
were sanctioned in many States and UTs.
→ Global Environment Facility (GEF) was in news.
→ UN IPCC releases 2 nd part of 6 th Assessment Report / sixth Assessment Report on Climate Change.
→ UN IPCC releases 3 rd part of 6 th Assessment Report / sixth Assessment Report on Climate Change.
→ NITI Aayog launches State Energy and Climate Index (SECI).
→ Pennsylvania becomes 1 st major fossil fuel-producing State in US to adopt carbon pricing policy to address
climate change. It joins States where coal, oil, natural gas power plants must buy credits for every ton of
carbon dioxide they emit.
→ WMO releases Global Annual to Decadal Climate Update report.
→ Usage of term ‘carbon bombs’ picked up after investigative project of “The Guardian” newspaper. This
project reports plans of countries and private companies all over world to engage in 195 ‘carbon bomb’.
→ 2022 Environmental Performance Index released. This report has placed India at bottom rank – 180 th and
India has rejected this report.
→ At virtual meeting of Major Economies Forum on Energy and Climate (MEF), Union Minister calls upon
members of MEF to launch one global movement on LIFE i.e., Lifestyle for Environment. [2022 MEF meeting
was aimed at galvanising actions (both developed and developing countries) that are to strengthen energy
security and tackle climate crisis and thereby building momentum for COP27].
→ One report by UNFAO and EBRD (European Bank for Reconstruction and Development), highlights need for
decarbonizing agrifood systems. Also, this report says Agrifood companies’ efforts to achieve carbon
neutrality have been uneven.
→ Congo, home to one of largest old-growth rainforests on Earth, is auctioning off vast amounts of peatland
and rainforest in push to become new destination for oil investments. Threats: These Oil and gas blocks,
extend into Virunga National Park, world’s most important gorilla sanctuary, as well as tropical p eatlands
that store vast amounts of carbon, keeping it out of atmosphere and from contributing to global warming.
→ Union Cabinet, chaired by PM, approves (i.e. India has ratified) India’s climate pledges made by PM
Narendra Modi in Glasgow in 2021 to accelerate India’s reliance on renewable energy to power economy
and be effectively fossil fuel-free by 2070. However approved pledges are fewer than those PM Modi
committed to. (Background: In effort to battle climate change, PM Modi made 5-point (Panchamrit)
announcements at COP26 summit in Glasgow, Scotland in 2021).

Page 626 of 719

 Also, Union Cabinet approves one update to India’s Nationally Determined Contribution (NDC), which
is formal communication to UN, spelling out steps to be taken by India towards keeping global
temperatures from rising beyond 2°C by end of this century. However, India’s updated NDC does not
include all promises made at COP26.
→ USA Senate approves one Bill titled Inflation Reduction Act, 2022. It has special focus on climate,
healthcare, tax provisions to address inflation. This Bill marks largest American investment aimed toward
making US leader in clean energy. It includes packages billions of dollar for clean energy transition. [This
bill is scaled-down version of USA President Biden’s Build Back Better Act (BBBA), which failed to get
approval from US Senate.].
→ According to ‘Getting India to Net Zero’ report, released by former Australian Prime Minister Kevin Rudd,
investment required will be USD 13.5 trillion if target is to be met by 2050 and USD 10.1 trillion from now
if it is to achieve its net-zero emissions target by 2070.
→ India updates its NDC to tackle climate crisis: India formally updates its NDC to fight climate change,
confirming to UN apex body that it will reduce emissions intensity of its GDP by 45% from 2005 levels by
year 2030, and to install capacity for non-fossil fuel-based power sources equivalent to India’s 50%
requirement by 2030. India formally submitted its updated Intended NDC target to UNFCCC.
→ According to one report by USA National Oceanic and Atmospheric Administration (NOAA), GHG and sea
levels touched new highs in 2021. This NOAA Report says that amount of GHG in atmosphere was 414.7
parts per million in 2021, which is 2.3 parts higher than in 2020.
→ Norway is building world’s 1 st open access Carbon Capture and Storage (CSS) where one emitter can deliver
captured carbon for storage.
→ According to one report of World Animal Protection – “Climate change and cruelty: revealing true impact of factory
farming” – released in 2022, factory farming of animal products for human consumption is fueling climate change.
→ Pakistan floods: Pakistan wants rich countries that have contributed most to climate change, to pay damages to
poorer nations. [Climate reparation argument has been made repeatedly, but remains difficult to implement].
→ Scientists sound alarm as number of climate tipping elements rises: While some tipping points may have been crossed
or are close to being crossed, more would be crossed as planet warms, says one study.
→ PM launches ‘LiFE Movement’ for Adoption of Environment - Conscious Lifestyle on occasion of World Environment
Day (5th June).
→ WMO releases “United in Science 2022” report. [WMO is spearheading one drive to ensure Early Warnings for All in
next 5 years].
→ Carbon Tracker (one non-profit think tank i.e climate campaigner) launches “Global Registry of Fossil Fuels”.
→ One study published in the journal Science says earth may have already passed through 5 dangerous tipping points
due to the 1.1°C of global heating caused by humanity to date.
→ With aim to facilitate eco-friendly events and designed to evaluate events’ sustainability performance, Gulf
Organisation for Research & Development (GORD), UNFCCC secretariat, and UNEP develop one online Green Events
Tool (GET). This platform was 1st introduced at UNCCC COP26 in Glasgow, Scotland in 2021.
→ While the world is worried about restricting global warming to within 1.5 degree or 2 degree Celsius, a new study
has found that even the current level of average global temperatures — about 1.1 degree Celsius higher than
preindustrial times — is enough to trigger catastrophic changes in several climatic systems. The study, published
recently in journal Science, has warned that the thresholds for many of these systems could be crossed at the current
levels of warming, setting off self-perpetuating changes that could put living beings at serious risk. [Steams flow down
the Tien Shan range (on border between China, Kazakhstan and Kyrgyzstan) and on where the Tuyuksu glacier in
Kazakhstan is melting rapidly. This is happening around the world].
→ UN Chief Antonio Guterres is on a 3-day visit to India, during which he will attend an event relating to the Mission
LiFE with PM Modi.
→ PM Modi launches Mission LiFE (Lifestyle for Environment) in the presence of UN Secretary General, Antonio
Guterres with PM Modi: PM Modi, in the presence of UN Secretary-General Antonio Guterres, launches ‘Mission
LiFE’ (Lifestyle for Environment), a new initiative for sustainable and healthy lifestyle, at the Statue of Unity in Gujarat.
Listing climate change and global warming as the main challenges before the world and mankind, PM Modi
underlined that Mission LiFE makes the fight against climate change democratic with the contribution of everyone in
per own capacity.
→ According to report – “Climate Transparency Report 2022” - India suffered an income loss of USD 159 billion i.e. 5.4%
of its GDP, in the service, manufacturing, agriculture, and construction sectors due to extreme heat in 2021. And
that, between 2016–21, extreme events triggered by climate change caused damage to crops in over 36 million
hectares, and a USD 3.75 billion loss for farmers in India.
→ Climate change amplifying health impacts of multiple crises: Ahead of 2022 UN Climate Change Conference (COP27),
a major new report (The Lancet report) has said that the continued dependence on fossil fuels is compounding the
health impacts of the multiple crises the world is facing — including the fallouts of the Covid-19 pandemic, 2022 war
in Ukraine, the cost of living crisis, and climate change. [UN Climate Change Conferences are yearly conferences held
in the framework of the UNFCCC].

Page 627 of 719

 → A new report released by UNFCCC (UNFCCC’s synthesis report 2022) in 2022 says the NDC pledged by countries to
arrest climate change are insufficient.
→ According to the report - Global Investment Trends Monitor, No. 43 - published by UNCTAD in 2022, the number of
climate mitigation and adaptation investment projects declined 7% and 12% respectively from January 2022 through
September 2022, as the world grapples with an economic slowdown. That, in stark contrast to the growth seen in
2021, investments shrank across industries, especially those that play a major role in tackling climate change.
The UNCTAD report analysts says: The gap between mitigation and adaptation financing was huge this year
2022. The funding was also lopsided, with the developing world losing out i.e. as much as 2/3rd of the international
project finance deals and greenfield investments in renewables went to developed economies. More than 1/2th the
investment projects on renewable energy (over 700) were in Europe in the 1st 3 quarters of 2022. North America and
developing Asia attracted about 200 projects each, while Latin America and the Caribbean and Africa had about 150
and 100 respectively. The global economic downturn has also affected fossil-fuel based energy generation and
extraction projects, which reduced 16% during the 1 st 3 quarters of 2022. The number of greenfield projects shrank
10% in the 1st 3 quarters of 2022 but grew in value due to some big-ticket announcements in electricity and gas
supply. But the fund distribution was uneven in the developing world - Latin America and developing Asia maintained
previous upward FDI momentum, while flows to Africa nearly dried up completely.
→ According to Emissions Gap Report 2022, current pledges by countries for reducing GHG emissions would still leave
the world warmer by 2.4-2.6 degrees celsius by the end of the century. This report finds that the international
community is falling far short of the Paris goals, with no credible pathway to 1.5°C in place. And that only an urgent
system-wide transformation can avoid climate disaster.
About:
 2021 landmark draft report, by UN Climate science advisers:
→ Climate change will fundamentally reshape life on Earth in coming decades, even if humans can tame
planet-warming GHG emissions.
→ Concern:
 Dangerous thresholds are closer than once thought.
 consequences from decades of uncontrolled carbon pollution are unavoidable in short term.
→ Impact:
 Species extinction
 more widespread disease
 unliveable heat
 ecosystem collapse
 cities menaced by rising seas.
 other devastating climate impacts are accelerating
 Food insecurity: Millions are likely to face chronic hunger by 2050. Millions could experience extreme
poverty within one decade, if inequality is allowed to deepen.
 In 2050s, coastal cities will be at risk from floods, storm surges made more deadly by rising seas.
 Water scarcity: Millions in urban areas will be exposed to water scarcity from severe droughts.
 Climate change becomes global challenge:
→ Last two decades had warmest years on record.
→ Extreme weather events - forest fires, heatwaves, floods - are becoming more frequent in Europe etc.
→ Scientists warn that without urgent action, global warming is likely to exceed 2°C above pre -industrial
levels by 2060, and could even reach 5°C by end of 21 st century. Such rise will have devastating impact on
nature, bringing irreversible changes to ecosystems and consequent loss of biodiversity.
→ Higher temperatures
→ intensified weather events
→ huge costs for economy
→ hamper countries’ ability to produce food.
→ Global cost of air pollution from fossil fuels is high. India is estimated to bear cost of USD 150 billion from
air pollution caused by fossil fuels.
→ Climate migration: Poor people will be forced to move due to slow-onset climate change impacts of -
decreasing productivity, Shortage of water, Rising sea level.
 Net-Zero / Net Zero / carbon-neutrality / carbon neutrality:
→ What:
 Carbon neutrality (Net zero) means that any CO2 released into atmosphere from human activity is balanced by
equivalent amount being removed.
 Carbon neutrality is one state of net-zero CO2 emissions. This can be achieved by balancing emissions of CO2
with its removal (often through carbon offsetting) or by eliminating emissions from society (transition to "post-
carbon economy").
 Net-zero means country’s emissions are compensated by absorption and removal of GHG from atmosphere.
 Net-zero does not mean that country will bring down its emissions to zero (gross-zero).

Page 628 of 719

  Net-zero formulation does not assign any emission reduction targets on any country.
→ Carbon Negative:
 What:
• It means removal of more CO2 from atmosphere than emitted CO2. It is one step farther than Carbon
Neutrality.
→ Carbon dioxide removal (CDR) / Negative CO2 emissions:
 What:
• One process in which CO2 gas is removed from atmosphere and sequestered for long periods of time.
• CDR and GGR methods are also known as Negative Emissions Technologies (NET), and may be cheaper than
preventing some agricultural GHG emissions.
 Net negative emissions: Meeting ambitious international climate goals may require global CO2 emissions to fall
below 0 in 2nd half of this century, achieving what is known as Net negative emissions.
→ Greenhouse gas removal (GGR) / Negative greenhouse gas emissions:
 What:
• One process in which GHGs are removed from atmosphere by deliberate human activities, i.e., in addition
to removal that would occur via natural carbon cycle or atmospheric chemistry processes.
• CDR and GGR methods are also known as Negative Emissions Technologies (NET), and may be cheaper than
preventing some agricultural GHG emissions.
→ How:
 Absorption of emissions can be achieved by creating carbon sinks – forests etc.
 Removal of gases from atmosphere can be achieved by futuristic technologies - carbon capture, carbon storage
etc.
 Afforestation, reforestation, forest management
 Soil management
 Bioenergy with Carbon Capture and Storage (BECCS)
 Direct air carbon capture and storage (DACCS)
 Enhanced weathering (crushed minerals bind CO2 chemically)
 Ocean fertilization (by adding Iron and other nutrients)
→ Countries committed to net-zero:
 USA, UK, EU (“Fit for 55” plan), China, New Zealand.
 Even Microsoft, in 2020, announced that it aims to become carbon negative by 2030 and that by 2050, it plans
to remove from atmosphere all carbon that it has emitted since it was founded in 1975. This is one significant
commitment from one individual company, and it underscores potential for approaches using negative
emissions, or carbon dioxide removal, to play important role in meeting international climate goals.
→ Global campaign / call for net-zero:
 For last 2 years, active global campaign has been going on to get onboard every country to agree to net-zero
goal for 2050. Said campaign argues that global carbon neutrality by 2050 is only way to achieve Paris Agreement
target - keeping planet’s temperature to below 2°C, compared to pre-industrial times.
→ Net-zero and 2015 Paris Agreement:
 Net-zero goal is not included in 2015 Paris Agreement document of UNFCCC.
 Paris Agreement only requires every signatory party to take best climate action it can. Countries need to set
climate action targets for themselves, and achieved them (NDC).
→ India &Net-zero:
 India does not agree on net-zero:
• India argues that instead of parallel discussion on net-zero targets outside of Paris Agreement framework,
countries must focus on delivering on what they have already promised.
• India says committing to net-zero target will require retiring coal plants, fossil fuel and even then, it will not
guarantee that temp. rise will be below 1.5 degree C.
• India says future net-zero promises are hollow because countries responsible for climate crisis have not
delivered on previous promises.
• India argues that countries targetting net-zero will continue to pollute beyond their fair share.
 But, in 2021, COP26 glasgow summit, PM Modi said that India will achieve net zero emissions by 2070.
 India’s challenges to achieve net-zero:
• Achieving net-zero means significant cuts to fossil fuel use that could affect development of India.
• Over next 2 to 3 decades, India’s emissions are likely to grow (because of push for higher economic growth
in order to pull millions of Indian people out of poverty).
• No amount of afforestation / reforestation would be able to compensate for aforesaid emissions.
• Currently, most carbon removal technologies are either unreliable or expensive.
 Climate reparation:
→ What:

Page 629 of 719

  It refer to call for money to be paid by Global North to Global South as one means of addressing historical
contributions that Global North has made (and continues to make) toward climate change. Principle is that
demand for compensation for loss and damage from climate disasters is one extension of universally
acknowledged “Polluter Pays” principle (polluter liable for paying for remedial action and compensating victims).
→ Example:
 Pakistan floods: in 2022, Pakistan said that it wants rich countries that have contributed most to climate change,
to pay damages to poorer nations including Pakistan. [Climate reparation argument has been made repeatedly,
but remains difficult to implement].
→ Global Norms:
 UNFCCC in 1994 explicitly acknowledged that rich countries must provide both finance and technology to
developing nations to help them tackle climate change. Under this, USD 100 billion amount, rich countries
agreed to provide every year to developing world. But this is not yet fulfilled.
 Warsaw International Mechanism for Loss and Damages (2013) was 1st formal acknowledgement of need to
compensate developing countries struck by climate disasters.
→ Limitations:
 Reluctance from developed countries, difficulty in estimating quantum of loss and damage, no mandatory global
consensus.
→ Conclusion:
 On face of it, Pakistan’s and other developing world’s demand for reparations have very low chance of getting
fulfilled eventhough principles being invoked are fairly well-established in environmental jurisprudence.
 Impact of Climate change on health:
→ Affects plant and animal growth.
→ Air quality. Food and water security. Disease. Extreme heat and weather. Social impacts.
→ In 2022, ahead of 2022 UN Climate Change Conference (COP27), a major report (The Lancet report) said that the
continued dependence on fossil fuels wsa compounding the health impacts of the multiple crises the world was
facing — including the fallouts of the Covid-19 pandemic, 2022 war in Ukraine, the cost of living crisis, and climate
change.
 Key highlights of the Lancet report published in 2022:
• Impact on vulnerable populations: Elderly and children under 1 year of age – are at acute risk of heat stress,
heat stroke, and other adverse physical and mental health.
• Wildfires: Drier and hotter weather is making conditions increasingly suitable for the start and spread of
wildfires, putting people’s health and safety at risk.
• Spread of diseases: Climate change is affecting the distribution and transmission of many infectious
diseases, including vector-borne, food-borne, and waterborne diseases. The climatic suitability for the
transmission of dengue increased by about 11% for Aedes aegypti and 12% for Aedes albopictus from 1951–
60 to 2012–21.
• Food insecurity: On average, 29% more of the global land area was affected by extreme drought annually
between 2012–21, than between 1951–60.
• On India specific:
 Decrease in growth season: The duration of the growing season for maize decreased by 2%, compared
to a 1981-2010 baseline, while rice and winter wheat each decreased by 1%.
 Increased heat wave events.
 Increase in heat-related deaths: From 2000-04 to 2017-21, heat-related deaths increased by 55% in
India.
 Loss of labour hours.
 Vector-borne diseases.
→ Way Forward:
 Adapting heat action plans in each city. For instance, the Ahmedabad heat action plan that has shown mortality
can be reduced should be adapted everywhere.
 Focus on achieving Paris goal: A failure to tackle climate change would see heat extremes escalate even more
dangerously.
 Specific programmes such as shock responsive protection schemes, social assistance programmes for inability
to work and lost wages due to heat and expanded workplace protections – are some practical solutions.
 Focus on preventive measures like enhancement of green spaces (strategic planting and less pruning of trees to
provide more shade). Healthy and green urban redesign will promote physical activity and deliver more friendly,
liveable cities.
 Burning of dirty fuels needs to be minimised as soon as possible to reduce the accompanying health impacts.
 Issue:
→ In India, poor, already surviving on margins, are severely impacted by extreme weather events. They are
1 st victims of climate change — though they have not contributed to stock of GHG in atmosphere.

Page 630 of 719

 → CO2 has long residence time in atmosphere and so, what is emitted in past has accumulated and will
“force” temperatures to rise. Also, CO2 is linked to way world runs economy — fossil fuels (coal or gas)
are still determinants of growth.
→ Sum of NDCs is inadequate: Studies show that even if all NDC targets are fulfilled, it would take world
towards minimum of 3°C temperature rise or more.
→ Today’s technology is unprepared to deal with the climate challenge.
→ Ignores forest economies: Tech-centric mitigation conversations leave forest economies and their
conservation.
→ Rising temperatures are causing large-scale changes in the climatic systems. It has also intensified the
Glacial melt, thinning of Arctic ice, and rise in sea levels.
→ According to an IPCC assessment report, with the current level of efforts, the world is on the path to
becoming more than 2 degrees warmer by the year 2100.
→ Threats to permafrost: The softening or melting of permafrost layers is already releasing some carbon into
the atmosphere. Permafrost layers hold as much as 1,700 billion tonnes of carbon, mainly in the form of
CO2 and CH4. [In comparison, the global emissions of carbon in a year are in the range of 40 billion tonnes].
→ In 2021, a report of UNEP estimated that the climate adaptation costs in the developing world amounts to
around USD 70 billion annually.
 Challenges ahead:
→ UNFCCC’s synthesis report 2022 says the NDC pledged by countries to arrest climate change are insufficient.
→ As of now, human activities have already caused global temperatures to rise by about 1 degree Celsius
above pre-industrial levels.
→ Currently, countries’ emissions targets are not in line with limiting global warming to under 1.5 degrees.
→ Global cost of air pollution from fossil fuels is high. India is estimated to bear cost of USD 150 billion from
air pollution caused by fossil fuels.
→ Backtracking on climate pledge:
 At climate summit, Congo endorsed one 10-year agreement to protect its rainforest, part of vast Congo Basin,
which is 2nd in size only to Amazon. However, in 2022, Congo, home to one of largest old-growth rainforests on
Earth, was auctioning off vast amounts of peatland and rainforest in push to become new destination for oil
investments. Threats: These oil and gas blocks, extend into Virunga National Park, world’s most important gorilla
sanctuary, as well as tropical peatlands that store vast amounts of carbon, keeping it out of atmosphere and
from contributing to global warming.
 Norway, one leading advocate of saving forests, is increasing oil production with plans for more offshore drilling
[exacerbated by Russian oil cut amid 2022 Ukraine war].
 USA President Joe Biden, who pledged early in his term to wean world from fossil fuels, travelled to Saudi Arabia
where he raised need for more oil production.
 Global initiative:
→ Countries adopt different approaches to address climate change:
 Social Cost of Carbon:
• Less direct approach. This approach calculates future climate damages to justify tougher
restrictions on polluting industries.
• This approach attempts to capture value of all climate damage, centuries into future.
• Social cost of carbon guides policy in practice.
• USA adopts this approach.
 Carbon Pricing approach:
• Carbon pricing reflects how much companies are willing to pay today for limited amount of
emission credits offered at auction.
• Carbon pricing represents policy in practice.
• Countries like Canada adopts Carbon Pricing approach. Canada imposes fuel charges on individuals
and also makes big polluters pay for emissions. Canada is one of 27 nations with some kind of
carbon tax.
→ USA: In 2022, USA Senate approved one Bill titled Inflation Reduction Act, 2022. It has special focus on climate,
healthcare, tax provisions to address inflation. This Bill marks largest American investment aimed toward making US
leader in clean energy. It includes packages billions of dollar for clean energy transition. [This bill is scaled-down
version of USA President Biden’s Build Back Better Act (BBBA), which failed to get approval from US Senate.].
→ Japan: “Invest in Kisida” - in 2022, Japan announced its ‘Invest in Kisida’ plan which aims for USD 1.1 trillion
investment to bolster Japanese economy. As part of this plan, Japan aims to transition to clean energy and achieve
46% reduction in GHG emissions by 2030.
→ EU: For its members, EU has binding climate and energy targets by 2030. Fit for 55 - In 2021, EU proposed ‘Fit
for 55’ plan to reduce emissions by 55% by 2030. This plan is expected to become law soon.
 Status:

Page 631 of 719

 → According to “Climate Transparency Report 2022”, G20 countries (responsible for over 3/4th of global emissions) are
not doing enough to mitigate global warming. That, 6 G20 countries (including India) have not signed the Global
Methane Pledge [2021]. And that, earth’s global surface temperature has increased by around 1°C compared with
the average in 1850–1900.
 India:
→ India, after US and China, is world’s 3rd biggest emitter of GHG, but its per capita emission is very low.
→ Emissions:
 India is already doing its part and that India’s per capita carbon emissions are 60% lower than global average.
→ Commitment:
 India’s ambitious renewable energy target of 450 GW by 2030.
 Despite its development challenges, India has taken many bold steps on clean energy, energy efficiency,
afforestation, biodiversity.
 India is among few countries whose NDCs are 2°C compatible.
 India commits to reducing the emission intensity of GDP by 2030 to 45% below its 2005 level, compared with
the previous target of 33-35%.
 India also commits to achieving 50% electricity generation capacity from non-fossil fuel sources by 2030, which
is 10% more than its previous target.
 Net-zero by 2070.
 Mission LiFE.
→ Emphasis:
 ISA (global initiatives); CDRI.
→ Initiatives to fight Climate Change:
 NCAP
 National Adaptation Fund for Climate Change (NAFCC) [2015]
 Bharat Stage-VI (BS-VI) emission norms
 Pradhan Mantri Ujjwala Yojana
 UJALA scheme
 SBM
 National Action Plan on Climate Change (NAPCC)
 ISA
 National Climate Vulnerability Assessment Report
 2015 FAME Scheme for E-mobility as part of National Mission for Electric Mobility
 Atal Mission for Rejuvenation & Urban Transformation (AMRUT) for Smart Cities.
 Share of renewable energy in India’s energy mix has increased.
→ India’s stand:
 India maintains that India will cut down use of fossil fuel but only gradually because it cannot
compromise on development [now primarily reliant on coal].
 India says countries should follow core principle of ‘common but differentiated responsibility’ that
requires developed countries, who are responsible for climate crisis, to take on deeper cuts and pay
developing countries for environmental damage (rising temperature) and finance their transition to
clean energy sources.
→ Challenges for India:
 Technology constrains
 financial constrains
 Inadequate shift of policies from grey to green economy. Example - over dependence on fossil fuels,
inefficient power grid infrastructure etc.
 Lack of synergy amongst various institutions in India.
 Achieving net-zero means significant cuts to fossil fuel use that could affect development of India.
 Over next 2 to 3 decades, India’s emissions are likely to grow (because of push for higher economic
growth in order to pull millions of Indian people out of poverty).
 No amount of afforestation / reforestation would be able to compensate for aforesaid emissions.
 Currently, most carbon removal technologies are either unreliable or expensive.
→ Way Forward for India:
 renewable first approach
 Create synergies amongst various Indian institutions and other countries. Example – OSOWOG
 Decarbonize emission-intensive sectors like - heavy industries, Iron and Steel.
 Need more carbon sinks (areas that store carbon) like forests, oceans, wetlands.
 Inclusion of local people in safeguarding environment
 Get sufficient resources towards climate adaptation. Example - Climate Finance Leadership Initiative
(CFLI) launched by India and UK.
 Ecosystem-based approach in implementing policies. Exmaple - FAME India scheme.
Page 632 of 719
 Reduce emphasis on domestic exploration.
Increase productivity.
Increase strategic reserves.
Restructure and reorganize public sector petroleum companies.
Avoid thinking in isolation.
To reach its targets, India should update its Nationally Determined Contributions (NDCs). India should
plan sector wise and should decarbonise electricity, transport sector. India should figure out how to
transition our coal sector. India should ramp up legal and institutional framework of climate change.
 Way Forward:
→ According to Emissions Gap Report 2022 released by UNEP, urgent sector and system-wide transformations
— in the electricity supply, industry, transport and buildings sectors and the food and financial systems —
would help to avoid climate disaster.
→ In 2022, Inger Andersen, executive director of UNEP, suggested to reform the global economy and almost 1/2th GHG
emissions by 2030. Even if we don’t meet our 2030 goals, we must strive to get as close as possible to 1.5°C, he
added. This means setting up the foundations of a net-zero future that will allow us to bring down temperature
overshoots and deliver many other social and environmental benefits — like clean air, green jobs and universal
energy access, he added.
→ End the toxic dependency on fossil fuels and rich countries should pay up their fair-share of finance to enable a just
and equitable transition to sustainable energy and food systems.
→ Forest-led mitigation effort. Why we need forest-led mitigation effort?
 Forests absorb a net 6 billion metric tonnes of CO2 per year.
 Study found that forests’ biophysical aspects have a tendency to cool the earth by an additional 0.5%.
 The conservation of forests, along with other nature -based solutions, can provide up to 37% of the
emissions reductions needed to tackle climate change.
 Scientists have stated that naturally preserved forests are 40% more effective than planted ones.
 Green infrastructure (salt marshes, mangroves) is 2 -5 times cheaper.
 Technology, at best, can assist us, not lead us, on the pathway to a sustainable, regener ative and
equitable world. Forest led should be the go to.
→ Preserving earth’s cyclical processes by protecting terrestrial ecosystems and natural sinks and
transformative agricultural practices under the leadership of indigenous people and local communitie s.
→ Reinvent economic growth model so that growth is low -carbon, sustainable and yet affordable i.e. Future
actions must accept reality of climate equity and use it to drive economic growth.
→ Developed nations fulfill their previous commitments like annual USD 100 billion to developing countries
for mitigating impacts of climate change, facilitating technology transfer, carbon credit markets.
→ Principles of Equity and Common but Differentiated Responsibilities and Respective Capabilities (CBDR -RC)
be respected.
→ Sustainable modes of living being practised in certain traditional communities should be made part of
school curricula.
→ Lessons from India’s efforts (JJM, Swach Bharat mission, mission ujwala) should be popularized globally.
→ Focus should be on climate adaptation as much as mitigation.
→ Cut GHG emissions.
→ Achieve 2015 Paris Climate Agreement.
→ To limit global warming below 1.5°C and to prevent irreversible damage from climate change, world needs to
collectively be on track.
→ And should aim to cut emissions, with most cuts by biggest emitters.
→ All countries – in particular major economies – should do their part to put world on 1.5 degrees Celsius limit on
warming.
→ We must let science drive our action.
→ World leaders, private sector, individuals should act together with urgency and do everything it takes to protect our
planet and our future.
→ According to new study (published in journal – “Nature”):
 Global oil & gas production should decline by 3% per year until 2050 so as to reach target set by 2015 Paris
Climate Agreement.
 Current fossil fuel extractions are not conducive to meeting targets of 2015 Paris Climate Agreement.
 Many regions in world have already reached their peak fossil fuel production. And that, any increase in fossil
fuel production will have to be offset by decline elsewhere, if 2015 Paris Climate Agreement goal wants to be
achieved.
Note:
 UNFCCC’s synthesis report:
→ What:

Page 633 of 719

  UNFCCC’s synthesis report is an annual summary of climate commitments made by countries and their impact
on global GHG emissions. These commitments — known as Nationally Determined Contributions — were made
by countries who signed on to the 2015 Paris Agreement to address climate change.
→ UNFCCC’s synthesis report 2022:
 Finding:
• This report says the NDC pledged by countries to arrest climate change are insufficient.
• Cumulative CO2 emissions in 2020-30, based on the latest NDCs, would likely use up 86% of the remaining
carbon budget. That is, at the current pace, 86% of the carbon budget for the 1.5°C threshold of warming
could be depleted by 2030.
• Marginal progress has been made over the past year 2021. The emission levels resulting from a hypothetical
implementation of the latest NDCs are about 5% lower in 2030, compared to this report’s previous edition.
• For the countries that have made their pledges more ambitious recently, the total GHG emissions will be
about 10 per cent lower in 2030 than their previous NDCs. [Updated NDCs are manifestations of 2015 Paris
Agreement’s ‘ratcheting mechanism’ — wherein countries must revise their pledges to be more ambitious
every 5 years].
• Cumulative CO2 emissions in 2020–30, based on the latest NDCs, would likely use up 86% of the remaining
carbon budget.
• Full implementation of all latest NDCs (including all conditional elements) is estimated to lead to a 3.6 (0.7-
6.6)% emission reduction by 2030 relative to the 2019 level. [Conditional elements refer to NDC targets that
are subject to the availability of financial, technical and other forms of support — mainly in the case of
developing countries. For example, India has made one of its new NDC targets conditional. India will switch
50% of its total power capacity to non-fossil sources by 2030. This pledge depends on the “transfer of
technology and low-cost international finance, including Green Climate Fund (GCF)].
 Congo Basin:
→ It is Earth’s 2nd Green Lung. Congo Basin rainforest covers about 240 million hectares across 8 nations. Crucial to
climate, it absorbs same annual amount of carbon as Africa emitted from fossil-fuel use each year in 2010s. This
forest supports hundreds of millions of people across Africa. At heart of Congo basin, is world’s largest tropical
peatland, one vast carbon store spanning 14 million hectares.
 Environmental Performance Index (EPI):
→ This report is prepared by Yale Centre for Environmental Law & Policy; and Centre for International Earth Science
Information Network Earth Institute, Columbia University.
→ EPI provides data-driven summary of state of sustainability around world.
→ It ranks 180 countries on 40 performance indicators including climate change, environmental public health,
biodiversity, etc.
→ It offers scorecard that highlights leaders and laggards in environmental performance.
→ It also provides practical guidance for countries that aspire to move toward sustainable future.
→ 2022 Environmental Performance Index:
 Highlight:
• Top 5 countries: Denmark, UK, Finland, Malta, Sweden.
• India is ranked at bottom in list of 180 countries (180th rank).
• Lowest scores go to India, then Myanmar, Vietnam, Bangladesh, Pakistan.
• US is ranked 43rd.
• Biggest emitter China is ranked 160th position.
 Why India is placed at bottom?
• This 2022 EPI report claimed that India prioritised economic growth over environment. India has poor air
quality and quickly rising GHG emissions.
 India rejected this 2022 EPI report. Reasons given by Indian government:
• This 2022 EPI report used many indicators based on unfounded assumptions.
• Methodology does not consider per capita emissions and different socio-economic conditions across
countries.
• Weight of indicators in which India was performing well has been reduced.
• Principle of equity is given very low weightage in form of indicators like GHG emission per capita and GHG
emission intensity trend.
• Common but differentiated responsibilities and respective capabilities (CBDR-RC) principle is also barely
reflected in composition of this index.
• Forests and wetlands, which act as crucial carbon sinks, have not been factored in while computing
projected GHG emissions trajectory up to 2050 by this EPI 2022.
 Difference between Earth’s average temperature in late 1800s and average temperatures today is 5°C.
 Carbon Bombs:
→ What:

Page 634 of 719

 Guardian newspaper defines it as oil or gas project that will result in at least 1 billion tonnes of CO2 emissions
over its lifetime. In total, around 195 such projects have been identified world over, including in US, Russia, West
Asia, Australia, India. They will collectively overshoot limit of emissions agreed to in Paris Agreement 2015.
→ Plan for ‘defusing’ carbon bombs:
 Network working towards this goal is called Leave It in Ground Initiative (LINGO).
 LINGO mission is to leave fossil fuels in ground and learn to live without them.
 LINGO believes root of climate change is burning of fossil fuels, and 100% use of renewable energy sources is
solution.
 LINGO aims to organise ground support for protesting such projects, challenge them through litigation, and
conduct analysis and studies for same.
 UNFCCC [1992]:
→ What:
 UN Climate Change Conferences / UN Framework Convention on Climate Change
 yearly conferences held in framework of UNFCCC.
 They serve as formal meeting of UNFCCC parties (COP) to assess progress in dealing with climate change.
 IT began in 1990s, to negotiate Kyoto Protocol to establish legally binding obligations for developed countries to
reduce their greenhouse gas emissions.
 From 2011 to 2015, these meetings were used to negotiate Paris Agreement as part of 2011 Durban platform,
which created general path towards climate action.
 Any final text of COP must be agreed by consensus.
 1st UNFCCC was held in 1995 in Berlin.
→ Aim:
 stabilisation of GHG concentrations in atmosphere
→ Estd.
 by Rio Earth Summit 1992 (beginning of international community’s 1st concerted effort to confront problem of
climate change) at United Nations Conference on Environment and Development (UNCED), informally known as
Earth Summit, held in Rio de Janeiro 1992.
→ Fact:
 Nearly all of world’s nations have now signed on it. It is parent treaty of 2015 Paris Agreement. It is parent treaty
of 1997 Kyoto Protocol.
→ Conference of Parties (COP) [UNFCCC]:
 What:
• global climate summits / UN Climate Change Conference
• brought by UN where majority of countries on earth participates.
• COP comes under UNFCCC
• COP members meet every year.
• It laid out a list of responsibilities for the member states which included:
 Agenda:
• Formulating measures to mitigate climate change.
• Cooperating in preparing for adaptation to impact of climate change.
• Promoting education, training and public awareness related to climate change.
→ 2021 UNFCCC / COP26:
 What:
• 26th UN Climate Change conference
• held in Glasgow, Scotland, UK in 2021.
• 26th COP to UNFCCC, 3rd meeting of parties to 2015 Paris Agreement (CMA3), 16th meeting of parties to
Kyoto Protocol (CMP16).
 4 Goals:
• secure global net-zero by mid-century and keep 1.5 degrees within reach.
• Adapt to protect communities and natural habitats.
• Mobilise finance: Developed countries must fulfill their promises to mobilise at least USD 100 billion in
climate finance per year.
• Finalise Paris Rulebook: Leaders will work together to frame detailed rules that will help fulfil Paris
Agreement 2015.
 Outcome:
• The COP26 meet succeeded in resolving the thorny issue of framing rules for trading carbon credits across
borders. This issue had evaded resolution for close to 6 years.
• Over 100 nations pledged to cut 30% of their methane emissions by 2030.
• More than 400 financial institutions overseeing USD 130 trillion in assets promised to align their portfolios
with the target of achieving carbon neutrality by 2050.
• Result of COP26 was 2021 Glasgow Climate Pact.
Page 635 of 719
 India [at COP26]:
• India expressed concerns of developing countries at 26th session of COP / COP26 to UNFCCC held in
Glasgow, UK in 2021.
• India presented following 5 nectar elements (Panchamrit) of India’s climate action:
 Reach 500GW Non-fossil energy capacity by 2030.
 50% of India’s energy requirements from renewable energy by 2030.
 Reduction of total projected carbon emissions by 1 billion tonnes by 2030.
 Reduction of carbon intensity of Indian economy by 45% by 2030, over 2005 levels.
 Achieving target of net zero emissions by 2070.
• India highlighted that transfer of climate finance and low-cost climate technologies is important for
implementation of climate actions by developing countries. Ambitions on climate finance by developed
countries cannot remain same as they were at time of 2015 Paris Agreement. India emphasized that just as
UNFCCC tracks progress made in climate mitigation, UNFCCC should also track climate finance. India
conveyed to developed countries that India understands suffering of all other developing countries, shares
them, and hence raises voice of developing countries.
• India also shared mantra of LIFE - Lifestyle for Environment to combat climate change in COP26. It was
stated that Lifestyle for Environment should be taken forward as campaign to make it mass movement of
Environment Conscious Lifestyles. Message conveyed by India was that world needs mindful and deliberate
utilization, instead of mindless and destructive consumption.
• India’s approach:
 As part of its overall approach, India emphasized foundational principles of equity, and common but
differentiated responsibilities and respective capabilities.
 India also highlighted that all countries should have equitable access to global carbon budget, which is
finite global resource, for keeping temperature increase within limits set by 2015 Paris Agreement and
all countries must stay within their fair share of this global carbon budget, while using it responsibly.
 India also called on developed countries for climate justice, and for undertaking rapid reductions in
emissions during current decade so as to reach net zero much earlier than announced dates, as they
have used more than their fair share of depleting global carbon budget.
→ 2021 Glasgow Climate Pact:
 What:
• Agreement reached at 2021 UNFCCC / COP26 at Glasgow.
 Background:
• 2021 Glasgow Climate Pacct was negotiated through consensus of parties. Owing to late interventions from
India and China that weakened move to end coal power and fossil fuel subsidies, COP26 conference ended
with adoption of less stringent resolution.
 Feature:
• It is 1st climate deal to explicitly commit to reducing use of coal.
• It encourages more urgent greenhouse gas emissions (GHG) cuts.
• It promises more climate finance for developing countries to adapt to climate impacts.
• Pledge to "phase out" coal was changed to "phase down" late in negotiation, because of coal in India, coal
in China, other coal reliant countries.
 2015 Paris Climate Agreement:
→ What:
 Paris Agreement / Paris Accords / Paris Climate Accords
 legally binding international treaty on climate change adopted by UNFCCC Parties at Conference of Parties (COP)
21, Paris, 2015
 It strengthens global response to threat of climate change.
→ Goal:
 limit climate change in coming decades.
 slow process of global warming by holding increase in global average temperature to below 2 degrees above
pre-industrial levels
 pursue efforts to limit temperature increase to 1.5 degrees above pre-industrial levels.
→ Agreements [According to Paris Agreement document available in UNFCCC website]:
 Goal:
• Keeping increase in global average temperature to below 2 degree celcius above pre-industrial level
• Pursue to limit increase in temperature to 1.5 degree celcius above pre-industrial level
 Increase in ability to adapt to adverse impacts of climate change
 Increase in climate resilience ability
 Reductin of GHG emissions
 Making finance flows consistent

Page 636 of 719

  Implementation of this Paris Agreement shall reflect equity and principle of common but differiantiated
responsibilities and respective capabilities, in light of different national circumstances.
 Developed country Parties shall provide financial, technology and capacity building assistance / suport to
developing country Parties.
 To achieve this long-term temperature goal, countries aim to reach global peaking of GHG emissions as soon as
possible and so as to achieve climate neutral world by mid-century (2050).
→ Feature:
 Paris Agreement's long-term temperature goal is to keep rise in mean global temperature to well below 2°C
above pre-industrial levels, and preferably limit increase to 1.5°C, recognizing that this would substantially
reduce effects of climate change. Emissions should be reduced as soon as possible and reach net-zero by middle
of 21st century.
 It aims to limit GHG emissions so that rise in average global temperature by end of this century (21st Century)
does not exceed 2°C or even 1.5°C above pre-industrial levels.
 Adoption of 2015 Paris Agreement officially recognizes human influence on climate.
 By 2030, rich countries will provide at least USD 100B to developing countries for climate adaptation
 Every 5 years, countries shall revise their emissions reduction targets and measures.
 Climate neutrality (balance between emissions and sinks) should be reached by 2050.
 For 1st time, it defines climate loss and damages terms [though liability and compensation are not mentioned.]
 It urges to speed up clean tech development and international technology transfer.
 It binds saving and increasing forest area [to capture GHG from atmosphere].
→ Paris Agreement working mechanism:
 Implementation of economic and social transformation
 Countries’ 5-year cycleof climate action.
 By 2020, countries shall submit their Nationally Determined Contributions (NDCs) plans for climate action.
 NDC: NDCs are actions to be taken by party countries towards reduction of their GHG emissions and increasing
temperature resilience.
→ Support:
 Paris Agreement provides framework for:
• Financial support (developed countries to provide financial assistance to vulnerable countries);
• technical / technology support (technology development and technology transfer regarding GHG emissions
and climate change);
• capacity building support (developed countries to support capacity-building actions in developing
countries);
to countries that need it.
→ Challenges:
 Humans have already caused global temperatures to rise by about 1 degree Celsius above pre-industrial levels.
 Currently, countries’ emissions targets are not in line with limiting global warming to under 1.5 degrees.
 2021 UNEP Production Gap Report revealed that many top fossil fuel producing countries, including India, are
not prepared to meet requirements of 2015 Paris Climate Agreement.
→ Significance:
 Paris Agreement is landmark agreement on climate change because for 1st time, binding agreement brings all
party nations to combat climate change.
 Global cost of air pollution from fossil fuels is high.
→ Way Forward:
 According to 2021 UNEP Production Gap report, to meet 2015 Paris Agreement goals, global coal, oil, and gas
production (and consumption) have to start declining immediately.
 According to new study (published in journal – “Nature”):
• Global oil &gas production should decline by 3% per year until 2050 so as to reach target set by 2015 Paris
Climate Agreement.
• Current fossil fuel extractions are not conducive to meeting targets of 2015 Paris Climate Agreement.
• Many regions in world have already reached their peak fossil fuel production. And that, any increase in fossil
fuel production will have to be offset by decline elsewhere, if 2015 Paris Climate Agreement goal wants to
be achieved.
→ India:
 India is 7 th largest producer of fossil fuels.
 India’s Nationally Determined Contribution (NDC):
• INDCs are primary means for governments to communicate internationally steps they will take to address
climate change in their own countries. They are not legally binding. India submitted its NDCs in 2015 itself
and updated in 2022. India’s INDC is to be achieved primarily by 2030.
• Target:

Page 637 of 719

  Original Target: By 2030, 40% non-fossil fuel based electricity usage; and New Target according to
updated INDC in 2022: 50% by 2030 with help from international finance (Global climate fund) and
transfer of technology.
 Original Target: By 2030, about 35% reduction in GDP emissions from 2005 levels; and New Target
according to updated INDC in 2022: 45% of GDP by 2030.
 Propagating sustainable way of living: Mass movement for LiFE (Lifestyle for Environment) using
traditions and values of conservation.
 India also promised additional carbon sink of 2.5 to 3 billion tonnes of CO2 equivalent through
additional forest and tree cover by year 2030.
• Performance so far: India is on track towards meeting its NDCs.
• Importance: Achieving these targets will boost India’s GDP by up to 4.7% (2036) and create million new jobs.
 But, as part of Atmanirbhar Bharat campaign, India pledged to become self-reliant producer of coal and made
plan to invest Rs. 500 billion worth of infrastructure for coal extraction.
 Challenges ahead for India:
• India doesn’t have federal level policy on scaling down production of fossil fuels, or ensuring just transition
into renewable energy.
 Emissions Trading:
→ What:
 also known as Cap and Trade (CAT) system / Emissions Trading Scheme (ETS)
 market-based approach to control pollution by providing economic incentives for reducing emissions of
pollutants.
→ Objective:
 to reduce GHG emissions
 mitigating climate change.
→ Example:
 Carbon emission trading / Carbon trading:
• What:
 Emission trading (ETS) for carbon dioxide (CO2) and other greenhouse gases (GHG)
 form of carbon pricing / cap and trade (CAT) for carbon / carbon pricing.
 Carbon market where GHG emitters can buy and sell GHG emissions permits or allowances.
• Feature:
 It is approach to limit climate change by creating market with limited allowances for emissions. This can
lower competitiveness of fossil fuels and accelerate investments into low carbon sources of energy such
as wind power, photovoltaics.
 In carbon market, companies having surplus targets in hand will sell GHG emissions permits /
allowances and those companies polluting environment will have to buy said surplus.
 Government sets cap on total amount of carbon emissions for particular year, and then companies
receive / buy emissions quotas within said cap. That is, Carbon trading is buying and selling of carbon
credits that permit company, entity to emit certain amount of CO2.
• Significance:
 Lower competitiveness of fossil fuels. And that, fossil fuels are main driver for climate change. They
account for 89% of all CO2 emissions and 68% of all GHG emissions.
 Carbon emission trading for CO2 and other GHG has been introduced in China, EU and other countries
as key tool for climate change mitigation.
 Sulfur dioxide emission trading.
 Carbon price / Carbon pricing / Cap and Trade (CAT) for carbon / Carbon pricing / CO2 pricing:
→ What:
 Putting price on carbon.
 method for nations to reduce global warming. Herein, cost is applied to GHG emissions in order to encourage
polluters to reduce combustion of coal, oil, gas – main driver of climate change.
 This method is widely agreed and considered to be efficient.
 instrument that captures external costs of GHG emissions — costs of emissions that public pays for, such as
damage to crops, health care costs from heat waves and droughts, and loss of property from flooding and sea
level rise — and ties them to their sources through price, usually in form of price on carbon dioxide (CO2)
emitted.
→ Objective:
 to address economic problem that emissions of CO2 and other GHG are negative externality — detrimental
product that is not charged for by any market.
→ Types:
 Emissions trading systems (ETS) / cap-and-trade system:

Page 638 of 719

 •caps total level of GHG emissions and allows those industries with low emissions to sell their extra
allowances to larger emitters. By creating supply and demand for emissions allowances, ETS establishes
market price for GHG emissions. Cap helps ensure that required emission reductions will take place to keep
emitters (in aggregate) within their pre-allocated carbon budget.
 Carbon tax:
• It directly sets price on carbon by defining tax rate on GHG emissions or – more commonly – on carbon
content of fossil fuels.
• It is different from ETS in that emission reduction outcome of carbon tax is not pre-defined but carbon price
is.
→ Feature:
 Carbon price usually takes form of Carbon tax or fee or Carbon emission trading that depends on government
allotments or permits.
 Carbon pricing is increasingly popular mechanism that harnesses market forces to address climate change by
creating financial incentives for companies and countries to lower their emissions — either by switching to more
efficient processes or cleaner fuels.
 Carbon pricing reflects how much companies are willing to pay today for limited amount of emission
credits offered at auction.
 Carbon pricing represents policy in practice.
→ Issues:
 Carbon prices now exist in 46 countries, covering about 22% of carbon pollution that humans release
each year. But these policies are having loopholes.
 Big carbon polluters like fossil fuel companies, electric utilities, automakers, petrochemical companies,
other heavy industries, are using their structural power to receive policy exemptions.
 According to World Bank, countries need policies between USD 40 to USD 80 per tonne to meet 2015
Paris Agreement targets. Yet, 1/2 of world’s carbon prices are less than USD 10 per tonne.
 Some researchers suggested that it limits innovations. [But there is no strong evidence that carbon
pricing has rapidly induced innovation we need in new, cleaner technologies].
→ Example:
 Countries like Canada adopts Carbon Pricing approach. Canada imposes fuel charges on individuals
and also makes big polluters pay for emissions. Canada is one of 27 nations with some kind of carbon
tax.
→ Significance:
 As awareness and support increases around these new instruments, analyses show that carbon pricing could
lead to significant costs for companies.
 Price on carbon helps shift burden for damage from GHG emissions back to those who are responsible for it and
who can avoid it.
 Instead of dictating who should reduce emissions where and how, carbon price provides economic signal to
emitters, and allows them to decide to either transform their activities and lower their emissions, or continue
emitting and paying for their emissions. In this way, overall environmental goal is achieved in most flexible and
least-cost way to society.
 Placing adequate price on GHG emissions is of fundamental relevance to internalize external cost of climate
change in broadest possible range of economic decision making and in setting economic incentives for clean
development.
 It can help to mobilize financial investments required to stimulate clean technology and market innovation,
fueling new, low-carbon drivers of economic growth.
 Putting price on carbon helps to incorporate climate risks into cost of doing business.
 Emitting carbon becomes more expensive, and consumers and producers seek ways to use technologies and
products that generate less of carbon. Market then operates as efficient means to cut emissions, fostering shift
to clean energy economy and driving innovation in low-carbon technologies.
→ Way Forward:
 Complementary renewable energy and energy efficiency policies are also critical to cost-effectively drive down
emissions.
 Carbon Footprint:
→ amount of GHGs - especially CO2 - released into atmosphere by humans.
 CO₂ budget:
→ CO₂ budget determines how much CO₂ country or person is allowed to emit in order to achieve global climate
protection goal of limiting global warming to 1.5 °C.
 National Climate Vulnerability Assessment Report:
→ What:
 Assessment report of India’s climate vulnerability.
 released by Min. of Science & Technology

Page 639 of 719

 → Aim:
 Identification of most vulnerable States and districts in India with respect to current climate risk and
vulnerability.
→ Significance:
 help in initiating climate actions at ground level.
 great input to Policymakers in initiating appropriate climate actions.
 can be used for India’s National Action Plan on Climate Change, 2008.
 can be used for India’s reporting on Nationally Determined Contributions (NDC) under 2015 Paris Agreement.
→ Highly vulnerable States in India, to climate change (latest report):
 Arunachal Pradesh, Assam, Mizoram, West Bengal, Jharkhand, Orissa, Chhattisgarh, Bihar.
→ latest report says said highly vulnerable States in India are mostly in eastern India.
 Groundswell report (by World Bank):
→ 3 different scenarios:
 Most pessimistic scenario:
• high level of emissions and unequal development
• This report forecasts millions of people moving within their own countries across regions of - Latin America,
North Africa, Sub-Saharan Africa, Eastern Europe, Central Asia, South Asia, East Asia, Pacific.
 Most climate-friendly scenario:
• low level of emissions, sustainable development
• This report forecasts world could still see millions of people being forced to leave their homes.
 Worst-case scenario:
• Sub-Saharan Africa —most vulnerable region due to desertification, fragile coastlines, dependence on
agriculture — would see most migrants, moving within national borders.
→ This report forecasts hotspots of internal climate migration could emerge by next decade.
→ Policy recommendations:
 Groundswell report provides policy recommendations to help slow climate migration:
• Reducing global emissions
• meet temperature goals of 2015 Paris Agreement.
• Preparing to tackle migration
• Research in factors of internal climate migration [to make well-targeted policies]
• Include internal climate migration in development planning.
 2021 WMO CO2 emission report:
→ Increase in CO2 from 2019 to 2020 was slightly lower than that obser ved from 2018 to 2019 but higher
than average annual growth rate over past decade.
→ For methane CH4, increase from 2019 to 2020 was higher than that observed from 2018 to 2019 and also
higher than average annual growth rate over past decade.
→ For nitrous oxides (NOx), increase was higher and also higher than average annual growth rate over past
years.
→ At present, concentration of carbon dioxide (CO2) about 150% of pre -industrial level.
→ At present, concentration of Methane (CH4) is about 250% of pre -industrial level.
→ At present, concentration of nitrous oxide (N2O) is about 125% pre -industrial level.
→ Roughly half of CO2 emitted by human activities remains in atmosphere. Other half is taken up by oceans,
land ecosystems.
→ Concern:
 Report says ability of land ecosystems and oceans to act as sinks may become less effective in future, thus
reducing their ability to absorb CO2 and act as buffer against larger temperature increase.
 At current rate of increase in greenhouse gas concentrations, we will see temperature increase by end of this
century far in excess of Paris Agreement targets of 1.5 to 2 degrees Celsius above pre-industrial levels.
 Climate Change Performance Index (CCPI):
→ What:
 report released by Germanwatch, New Climate Institute, Climate Action Network together
 monitors climate mitigation progress of many countries and European Union.
→ Categories:
 GHG Emissions; Renewable Energy; Energy Use; Climate Policy.
→ Performance (latest CCPI):
 Top 3 ranks are empty because no country performed well enough in all i ndex categories.
 Top 3 ranks in GHG emissions category are also empty.
 Scandinavian countries (Denmark, Sweden, …) achieved best results because of their outstanding
effort on renewable energy.
 India:

Page 640 of 719

 • India is at number 10 rank
• India is high performer except in renewable energy category.
• India is benefiting from its relatively low per-capita emissions.
 In 2021, Vinisha Umashankar (one finalists for Earthshot Prize) from Tamil Nadu spoke on clean energy at meeting that
discussed clean technology and innovation as part of 26th UN Climate Change Conference of Parties (COP26) in Glasgow.
→ Vinisha Umashankar said:
 Young people have every reason to be angry and frustrated at leaders who have made empty promises
and failed to deliver. None of what we discuss today is practical for me. We need actions rather than
promises to live in habitable world.
 She urged everyone – world leaders, business leaders, international organization, civil society – to
immediately “stop talking and start acting” when it comes to tackling climate change.
 Adaptation Fund [2001]:
→ What:
 international fund that finances projects / programmes that help vulnerable communities in
developing countries adapt to climate change.
 established under Kyoto Protocol of UNFCCC.
→ Feature:
 Its initiatives are based on country needs, views and priorities.
→ Financing:
 Adaptation Fund is financed by government, private don ors, Certified Emission Reductions (CERs)
issued under Kyoto Protocol.
→ Governance:
 Adaptation Fund is supervised and managed by Adaptation Fund Board (AFB).
 World Bank (WB) serves as trustee of Adaptation Fund on interim basis.
 National Adaptation Fund for Climate Change (NAFCC) [2015]:
→ What:
 Central Sector Scheme to support concrete adaptation activities to mitigate adverse effects of climate
change.
 To meet cost of adaptation to climate change for States and UTs of India particularly vulnerable to
adverse effects of climate change.
 National Bank for Agriculture and Rural Development (NABARD) is National Implementing Entity (NIE).
→ Objectives:
 To fund concrete adaptation projects / programmes aligned with relevant missions under National
Action Plan on Climate Change (NAPCC), State Action on Climate Change (SAPCC) in agriculture,
horticulture, agro-forestry, environment, allied activities, water, forestry, urban, coastal and low -lying
system, disaster management, human health, marine system, tourism, habitat sector, other rural
livelihood sectors so as to address climate change related issues.
→ Feature:
 Activities under NAFCC scheme are implemented in project mode.
 To prepare and update climate scenario, assess vulnerability and climate impact assessment.
 Capacity building of stakeholders on climate change adaptation, project cycle management and
developing knowledge network.
 Mainstreaming approaches / learnings from project / programme implementation through knowledge
Management.
 Projects related to adaptation are carried out in sectors like Agriculture, animal husbandry, water,
forestry, tourism etc. These projects are eligible for funding under NAFCC.
→ NAFCC Outcome Framework:
 Fund level outcome parameters consist of:
• Reduced key risks and adverse impacts of climate change in water and agriculture sectors.
• Maximised multi-sectoral, cross-sectoral benefits / co-benefits [to meet challenges of water and food
security].
• Human development, poverty alleviation, livelihood security, enhanced awareness of community.
• Strengthened institutional & individual capacity [to reduce risks associated with climate-induced
socioeconomic and environmental losses].
• Strengthened awareness, strengthened ownership of adaptation, strengthened climate risk reduction
processes at local level.
• Increased ecosystem resilience in response to climate change and variability-induced stress.
• Diversified and strengthened livelihoods and sources of income for vulnerable people in targeted areas.
• Improved policies and regulations that promote and enforce resilience measure.
→ Implementation

Page 641 of 719

  Considering existing arrangement with NABARD as National Implementing Entity (NIE) for Adaptation
Fund (AF) under 1997 Kyoto Protocol and its presence across India, NABARD has been designated as
National Implementing Entity (NIE) for implementation of adaptation projects under NAFCC.
 NABARD facilitate identification of project ideas / concepts from State Action Plan for Climate Change
(SAPCC), project formulation, appraisal, sanction, disbursement of fund, monitoring & evaluation,
capacity building of stakeholders.
 States / UTs are required to prepare project proposal in consultation with NIE i.e. NABARD. States /
UTs project proposals should be approved by State Steering Committee on Climate Chang e to be
eligible for consideration under NAFCC.
 It is discretion of State Government to engage or not any organization to assist in project preparation.
 Global Environment Facility (GEF) [1992]:
→ What:
 Financial organisation established to help tackle our p lanet's most pressing environmental problems.
 GEF unites 184 countries in partnership with international institutions, civil society organizations
(CSOs), private sector to address global environmental issues while supporting national sustainable
development initiatives.
 independently operating financial organization
 established on eve of 1992 Rio Earth summit
 based in Washington, D.C., United States.
 GEF is jointly managed by UNDP, World Bank, UNEP.
→ Establishment:
 “Instrument for Establishment of Restructured GEF” is document that established GEF.
→ Function:
 GEF provides grants for projects related to Biodiversity, climate change, international waters, land
degradation, ozone layer, persistent organic pollutants (POPs), mercury, sustainable forest
management, food security, sustainable cities.
 GEF provides funds to developing countries and transition economies for projects related to climate
change, biodiversity, the ozone layer, etc.
 GEF also serves as financial mechanism for following conventions:
• Convention on Biological Diversity (CBD)
• UN Framework Convention on Climate Change (UNFCCC)
• UNCCD
• Stockholm Convention on Persistent Organic Pollutants
• Minamata Convention on Mercury
• GEF, although not linked formally to Montreal Protocol on Substances that Deplete Ozone Layer (MP),
supports implementation of Montreal Protocol in countries with economies in transition.
→ Signficance:
 Since 1992, GEF has provided about USD 20 billion in grants and mobilized additional about USD 100
billion in co-financing for many projects in many countries.
 GEF has also provided support to nearly 24,000 civil society and community initiatives in many
countries.
 Wet-bulb temperature (WBT):
→ temperature read by thermometer covered in water -soaked (water at ambient temperature) cloth (wet-
bulb thermometer) over which air is passed.
→ At 100% relative humidity, wet-bulb temperature is equal to air temperature (dry -bulb temperature); at
lower humidity wet-bulb temperature is lower than dry-bulb temperature because of evaporative cooling.
→ It is one measure that combines heat and humidity. Wet -bulb temperature of 31 degrees Celsius is
extremely dangerous for humans, while value of 35 degrees is unsurvivable.
 Intergovernmental Panel on Climate Change (IPCC) [1988]:
→ What:
 intergovernmental body of UN responsible for advancing knowledge on human-induced climate change.
 established by World Meteorological Organization (WMO) and UNEP and later endorsed by UNGA.
 headquartered - Geneva, Switzerland
→ Composition:
 It has 195 member states.
→ Function:
 To provide policymakers with regular assessments of scientific basis of climate change, its impacts and future
risks, and options for adaptation and mitigation.
 IPCC provides objective and comprehensive scientific information on anthropogenic climate change, including
natural, political, economic impacts and risks, and possible response options.

Page 642 of 719

  IPCC does not conduct original research nor monitor climate change, but rather undertakes periodic, systematic
review of all relevant published literature. Thousands of scientists, other experts volunteer to review data and
compile key findings into "Assessment Reports" for policymakers and general public;this has been described as
biggest peer review process in scientific community.
→ Significance:
 IPCC is internationally accepted authority on climate change, and its work is widely agreed upon by leading
climate scientists, governments.
 Its reports play key role in UNFCCC,with 5thAssessment Report heavily informing landmark 2015 Paris
Agreement.
 IPCC shared 2007 Nobel Peace Prize with Al Gore for contributions to human understanding of climate change.
→ UN IPCC Assessment Report on Climate Change [1990]:
 What:
• series of reports intended to assess scientific, technical, socio-economic information concerning climate
change.
• This report evaluates physical science of climate change – looking at past, present, future climate.
• It reveals how human-caused emissions are altering our planet and what that means for our collective
future.
• most comprehensive evaluations of state of earth’s climate.
• So far 5 reports have been released.
 UN IPCC Sixth Assessment Report on Climate Change / 6thAssessment Report on Climate Change:
• 1 st Part (released in 2021):
 This centres around scientific basis of climate change.
 Highlights:
o Weather and climate events – extreme heat, heavy rainfall, fire conditions, droughts – are
becoming more severe and frequent because of climate change.
o We are already moving closer to 1.5 degrees Celsius warmer world
o Every day emissions rise and preventing worst impacts of climate change become dimmer.
o Carbon dioxide will continue to be dominant cause of global warming.
 Major concerns:
o Our climate is rapidly changing due to human influence and is already altering our planet in drastic
ways:
✓ Arctic Sea ice is at its lowest level in last 150 years
✓ Sea levels are rising faster than at any time in last 3,000 years
✓ Glaciers are declining at rate unknown in last 2,000 years
 Remedy:
o If greenhouse gas (GHG) emissions are halved by 2030 and net zero by 2050, global warming can
be stopped.
 This 2021 IPCC report justified India’s position that historical cumulative emissions are cause
of climate crisis that world faces today.
• 2nd Part (released in 2022):
 This centres around climate change impacts, risks, vulnerabilities, and adaptation options.
 Highlights:
o For 1sttime, it made assessment of regional and sectoral impacts of climate change.
o It has included risks to, and vulnerabilities of, mega-cities around world. For example, it says
Mumbai is at high risk of sea-level rise and flooding, Ahmedabad faces serious danger of heat-
waves.
 Impact on health:
o For 1sttime, IPCC report has looked at health impacts of climate change.
o It has found that climate change is increasing vector-borne and water-borne diseases like malaria,
dengue, particularly in sub-tropical regions of Asia.
o It also says deaths related to circulatory, respiratory, diabetic, infectious diseases, and infant
mortality are likely to increase with rise in temperature.
o Increasing frequency of extreme weather events like heat waves, flooding, drought, even air
pollution was contributing to under-nutrition, allergic diseases, even mental disorders.
 India:
o It identifies India as one of vulnerable hotspots, with many regions, important cities facing very
high risk of climate disasters like flooding, sea-level rise, heat-waves. Mumbai is at high risk of sea-
level rise, flooding.
o Ahmedabad faces serious danger of heat-waves.
o Many cities, like Chennai, Bhubaneshwar, Patna, Lucknow are approaching dangerous levels of
heat, humidity.

Page 643 of 719

 o Infrastructure like transportation, water, sanitation, energy systems has been compromised by
extreme and slow-onset events, with resulting economic losses, disruptions of services, impacts to
well- being.
o Urban India is at greater risk than other areas.
o At present, wet-bulb temperatures in India rarely exceed 31 degrees C, with most of country
experiencing maximum wet-bulb temperatures of 25-30 degrees C.
• 3rd Part (released in 2022):
 It centres around looking into possibilities of reducing emissions.
 Highlights:
o over past decade, emissions have continued to rise. Average annual global greenhouse gas
emissions in decade 2010-19 were at their highest levels in human history.
o Limiting global warming to around 1.5 degrees Celsius requires global GHG emissions to peak
before 2025 at latest, and be reduced by 43% by 2030.
o Pledges to Paris Agreement are insufficient [Nationally Determined Contributions (NDCs)].
o Low climate finance flows from developed countries have affected energy transition in developing
countries.
→ Significance of IPCC Reports:
 IPCC reports form scientific basis on which countries build their policy responses to climate change.
 IPCC reports, on their own, are not policy prescriptive i.e. they do not tell countries or governments what to do.
They are only meant to present factual situations with scientific evidences.
 IPCC reports are of immense help in formulating action plans to deal with climate change.
 IPCC reports also form basis for international climate change negotiations that decide on responses at global
level. Example - these negotiations have produced 1997 Kyoto Protocol, 2015 Paris Agreement.
 WMO Global Annual to Decadal Climate Update:
→ What:
 annual update report released by WMO
 It harnesses expertise of internationally acclaimed climate scientists and best prediction systems from
leading climate centres around world to produce actionable information for decision -makers.
→ 2022 report:
 Findings:
• There is 50% chance that world may temporarily breach 1.5°C of warming in next 5 years.
• There is 93% chance that at least 1 year between 2022 and 2026 will replace 2016 as warmest year on
record.
• Chance of temporarily exceeding 1.5°C has risen steadily since 2015, when it was close to 0. For years
between 2017 and 2021, there was 10% chance of exceedance. That probability has increased to nearly 50%
for 2022-26 period.
• Annual mean global near-surface temperature for each year between 2022 and 2026 is predicted to be
between 1.1°C and 1.7°C higher than pre-industrial levels (average over years 1850-1900).
• Arctic temperature anomaly, compared to 1991-2020 average, is predicted to be more than 3 times as large
as global mean anomaly when averaged over next 5 northern hemisphere extended winters.
• There is no signal for El Nino Southern Oscillation in 2022-23, but Southern Oscillation index is predicted to
be positive in 2022.
 India:
• India could be among few regions globally where below normal temperatures have been predicted for year
2022 and next 4 years. This may be because of possible increase in rainfall activity in this decade. Many
parts of India will receive above-normal rainfall. This will keep temperatures low.
 Major Economies Forum on Energy and Climate (MEF) [2009]:
→ What:
 MEF is intended to facilitate dialogue among major developed and developing economies, help generate political
leadership necessary to achieve successful outcome at UN climate change conference, and advance exploration
of concrete initiatives and joint ventures that increase supply of clean energy while cutting GHG emissions.
 MEF was launched in 2009 by US President Barack Obama.
 As of 2022, major economies participating in MEF include: India, European Union, …..
→ India at MEF 2022:
 India has already installed 159 GW of non-fossil fuel-based electricity generation capacity.
 During last 7. 5 years, India’s installed solar energy capacity has increased over 18 times.
 India’s annual per capita emissions are only 1/3rd of global average and its cumulative GHG emissions are less
than 4%.
 India’s Panchamrit goals are productive through one of largest clean energy development plans in world.
 India is on track to meet its commitments, through adoption of low carbon policies across key sectors of our
economy like green hydrogen mission, e-mobility.

Page 644 of 719

 National Oceanic and Atmospheric Administration (NOAA) report [USA]:
→ Finding:
 GHG and sea levels touched new highs in 2021. This NOAA Report says that amount of GHG in atmosphere was
414.7 parts per million in 2021, which is 2.3 parts higher than in 2020. Sea levels rose for 10 th year in row. They
reached new record of 8 inches (3.8%) above average for 1993 when satellite measurements began. Tropical
storms, which increase as Earth warms, spiked in 2021. Eg. Super Typhoon Rai, which killed nearly 400 people in
Philippines in 2021. Premature blooming of cherry trees in Kyoto, Japan, for 1 st time after 1409. Incidence of
wildfires has increased.
→ Reason:
 Rise in GHG levels is due to easing fossil fuel emissions in 2021, as much of global economy has slowed sharply
due to COVID-19 pandemic.
 Carbon capture and storage (CCS) / Carbon Capture and Sequestration:
→ Process of capturing CO2 before it enters atmosphere, transporting it, and storing it (carbon sequestration) for
centuries or millennia. Usually CO2 is captured from large point sources, such as chemical plant or biomass power
plant, and then stored in underground geological formation. Aim is to prevent release of CO2 from heavy industry
with intent of mitigating effects of climate change. CO2 has been injected into geological formations for several
decades for enhanced oil recovery and after separation from natural gas, but this has been criticised for producing
more emissions when gas or oil is burned.
→ Norway is building world’s 1 st open access Carbon Capture and Storage (CSS) where one emitter can deliver
captured carbon for storage.
 Tipping points in climate system:
→ In climate science, tipping point is critical threshold that, when crossed, leads to large and often
irreversible changes in climate system. If tipping points are crossed, they are likely to have severe impacts
on human society. Tipping behaviour is found across climate system, in ecosystems, ice sheets, and
circulation of ocean and atmosphere.
Climate tipping points are levels of ecological changes, if crossed, could spark significant change in
way Earth’s systems operate, affecting oceans, weather and chemical processes, which could be
“irreversible” and self-continuing even if there is no further warming.
Climate Tipping Points are markers of a larger climate system that when triggered beyond a threshold,
perpetuates (continue) warming on its own.
→ 6 tipping points likely to be crossed are:
 Greenland Ice Sheet collapse. West Antarctic Ice Sheet collapse. Collapse of ocean circulation in polar region of
North Atlantic. Coral reefs die off in low latitudes. Sudden thawing of permafrost in Northern regions. Abrupt
sea ice loss in Barents Sea.
→ Example:
 Several studies in the past 15 years have identified different tipping points such as the disintegration of the
Greenland ice sheet, a spontaneous reduction in Amazon forest cover, melting of glaciers, or softening of the
permanently frozen grounds in the polar regions that have large amounts of carbon trapped in them. Each of
these tipping points is correlated with each other with different levels of temperature rise.
→ Issue:
 Self-sustaining and cyclic system: Once the tipping point is crossed, this becomes a self-sustaining and cyclic
system. The system does not reverse even if the global temperatures stop rising.
 IPCC 6th assessment reports suggest that most of these tipping points would be crossed between 1 and 2 degree
Celsius temperature rise.
 Impact on India:
• A 1-metre rise in sea level will displace 7.1 million people in India.
• 6th IPCC assessment report released in 2022 said that global emissions of GHG needed to peak by 2025 and
reduce by 43% from current levels by 2030 if the 1.5 degree Celsius target was to be achieved.
→ Way Forward:
 Increase policy efforts to restrict global warming.
 Take the policy initiative to study the effects of rising temperatures.
 Countries need to increase the policy ambition of their climate action in the next few years.
 “United in Science” report:
→ One report released by WMO. It is one new multi-agency report coordinated by WMO. It provides overview
of most recent science related to climate change, its impacts and responses.
→ “United in Science 2022” report:
 Finding:
• This report shows that GHG concentrations continue to rise to record highs.
• Fossil fuel emission rates are now above pre-pandemic levels after temporary drop due to lockdowns.
Ambition of emissions reduction pledges for 2030 needs to be 7 times higher to be in line with 1.5°C goal of
Paris Agreement.

Page 645 of 719

 • Climate science is clear in that countries are heading in wrong direction.
• Many of extreme weather events that we are experiencing have become more likely and more intense due
to human-induced climate change.
 “Global Registry of Fossil Fuels”:
→ It is world’s 1st public database on fossil fuels. It is world’s 1st registry of fossil fuel reserves, production and emissions.
It will empower activists and investors to hold governments accountable. It was launched by Carbon Tracker (one
non-profit think tank i.e climate campaigner) in 2022. It is 1 st-ever fully transparent and public database that tracks
fossil fuel production worldwide. Registry will likely empower groups to hold governments accountable in range of
scenarios, for example, when issuing licenses for fossil fuel extraction.
Carbon Tracker that researches energy transition’s effect on financial markets, and Global Energy Monitor (one
NGO), which tracks range of global energy projects, jointly developed this registry.
 Green Events Tool (GET) [2022]:
→ It is one online platform developed by Gulf Organisation for Research & Development (GORD), UNFCCC secretariat,
and UNEP to facilitate eco-friendly events and designed to evaluate events’ sustainability performance. This platform
was 1st introduced at UNCCC COP26 in Glasgow, Scotland in 2021. GET aims to reduce carbon footprint in events i.e.
to reduce -ve impacts of various events on climate. GET will help in calculating carbon footprint for any planned event
at its planning stages itself and will recommend solutions for lowering footprint as well as suggesting carbon credit
for unavoidable ones.
 Lifestyle for Environment Movement / LiFE Movement / Mission LiFE:
→ What:
 This idea of LiFE was introduced by PM Modi during 26th UNFCCC of Parties (COP26) in Glasgow in 2021. This
idea promotes environment-conscious lifestyle that focuses on ‘mindful and deliberate utilisation’ instead of
‘mindless and destructive consumption’. PM Modi called upon global leaders to join the LiFE movement for
safeguarding the environment by adopting environment-friendly lifestyle. PM Modi urged to drive LiFE as an
international mass movement towards “mindful and deliberate utilisation, instead of mindless and destructive
consumption” to protect and preserve the environment.
LiFE Global Movement invites academicians, researchers and start-ups across the world to think about
specific and scientific ways in which the full potential of collective action can be harnessed to address the
environmental crisis.
→ Aim:
 This Movement aims to utilise power of collective action and attract individuals across world to undertake simple
climate-friendly actions in their daily lives.
 The mission is aimed at countering the effects of climate change by implementing macro measures and actions
at an individual level and at the community level.
 Mobilize at least 1 billion Indians and other global citizens to take individual and collective action for protecting
and preserving the environment in the period 2022 to 2027.
 Within India, at least 80% of all villages and urban local bodies are aimed to become environment-friendly by
2028.
→ Feature:
 ‘Pro-Planet People’ (P3):
• This Mission plans to create and nurture global network of individuals, namely ‘Pro-Planet People’ (P3). P3
will have shared commitment to adopt and promote environmentally friendly lifestyles.
 PM Modi said that the vision of LiFE is to live a lifestyle that is in tune with our planet and does not harm it. And
those who live such a lifestyle are called “Pro-Planet People”.
 PM said: in our daily life choices, let us pick the most sustainable options. Our planet is one but our efforts have
to be many – One earth, many efforts. India stands ready to support any effort for a better environment and to
further global wellness. Our track record speaks for itself.
 Rather than framing climate change as a ‘larger than life’ challenge, LIFE recognises that small individual actions
can tip the balance in the planet’s favour. But we need guiding frameworks, information sharing and the scale
of a global movement. [Mindful choices cultivated by LIFE animate this spirit — actions such as saving energy at
home; cycling and using public transport instead of driving; eating more plant-based foods and wasting less; and
leveraging our position as customers and employees to demand climate-friendly choices].
→ Implementation:
 NITI Aayog will help and incubate Mission LiFE in the 1 st year, and it will subsequently be implemented by
MoEFCC. The mission is a 5-year programme.
 It will act on the ideas and ideals of LiFE through a mission-mode, scientific and measurable programme.
→ Significance:
 Fight against climate change democratic with the contribution of everyone in their own capacity.
 It is a global initiative by India to help the world in its fight against climate change and to achieve the SDGs.
 P3 model (Pro Planet People): Premised on the basic principles of ‘Lifestyle of the planet, for the planet and by
the planet’.

Page 646 of 719

  LiFE Mission will encompass every lifestyle related to the conservation of nature, which our ancestors adopted.
 Based on Prakriti, Rakshati and Rakshita, that is, those who protect nature, nature protects them.
→ Way Forward:
 According to UNEP, if 1 billion people out of the global population of 8 billion adopt environment-friendly
behaviours in their daily lives, global carbon emissions could drop by approximately 20%.
 Many of the goals of LIFE can be achieved by deploying ‘nudges’, gentle persuasion techniques to encourage +ve
behaviour. The UNEP employs proven nudging techniques such as discouraging food waste by offering smaller
plates in cafeterias; encouraging recycling by making bin lids eye-catching; and encouraging cycling by creating
cycle paths.
 According to the UNEP, more than 2/3rd of GHG emissions can be attributed to household consumption and
lifestyles — the urgent cuts to global emissions we need can only be achieved through widespread adoption of
greener consumption habits.
 Onus on the developed world: The average carbon footprint of a person in a high-income country is more than
80 times higher than that of a person in a least-developed country. It is common sense and only fair to call on
the developed world to shoulder a proportionate share of this transition. In the words of Mahatma Gandhi - the
world has enough for everyone’s need, but not enough for everyone’s greed.
 India is an excellent place to start. With over 1.3 billion people, if we achieve a true Jan Andolan here, the
momentum generated will be enormous. As India leads, we will see the world increasingly follow LiFE
Movement.
→ India’s track record:
 In 2022, in Gujarat, when UN Chief A. Guterres came to India, PM Modi together with UN Secretary-General
Antonio Guterres called on all consumers across the world to become “Pro Planet People” by 2027, adopting
simple lifestyle changes that can collectively lead to transformational change.
 India has a proven track record translating the aspirations of national missions into whole-of-society efforts. The
success of the Swachh Bharat Mission, which mobilised individuals and communities across socio-economic
strata to become drivers of collective good health and sanitation is an example.
 Some more example - Panchamrit targets announced by PM Modi at COP26, to support the International Solar
Alliance, the Coalition for Disaster Resilient Infrastructure and South-South cooperation platforms, etc.
 The LIFE mission also recognises that accountability is relative to contribution. Emissions across the poorest half
of the world’s population combined still fall short of even 1% of the wealthiest. Those who consume the least,
often the most vulnerable and marginalised members of society, will not be asked to consume less, but rather
supported to participate in the green economy. Each ‘Pro Planet’ stakeholder is nudged according to
differentiated approaches.
 On Carbon footprint: Annual per capita carbon footprint in India is low.
 On Renewable energy: India has the 4th largest capacity for renewable energy in the world. India is ranked 4th in
wind energy and 5th in solar energy. India’s renewable energy capacity has increased by about 290% in the last
7-8 years.
 On Electric capacity: India has also achieved the target of 40% of the electric capacity from non-fossil-fuel sources
9 years ahead of the deadline.
 National Hydrogen Mission [2021] to move towards an environment-friendly energy source.
 “Climate Transparency Report”:
→ This Report provides a concise overview of the key facts and figures on the state of climate performance of the G20
in a comparative stocktake. The analysis covers adaptation, mitigation and finance, with 20 detailed country profiles
of all G20 members and a summary of key findings. Developed by experts from 16 partner organisations from the
majority of the G20 countries, the CTR report informs policy makers and stimulates national debates. Thanks to
comparable and concise information, the CTR serves as a useful reference for decision makers and actors, and also
for those central for climate for whom climate is not central.
CTR is the world’s most comprehensive annual review of G20 countries’ climate action and their transition to a
net zero emissions economy. It is prepared by experts from 16 partner organizations from the majority of the G20
countries.
→ “Climate Transparency Report 2022”:
 This 2022 CTR report especially highlights the link between the climate emergency and energy crisis.
 India suffered an income loss of USD 159 billion i.e. 5.4% of its GDP, in the service, manufacturing, agriculture,
and construction sectors due to extreme heat in 2021.
 Between 2016–21, extreme events triggered by climate change caused damage to crops in over 36 million
hectares, and a USD 3.75 billion loss for farmers in India.
 G20 countries (responsible for over 3/4th of global emissions) are not doing enough to mitigate global warming.
 6 G20 countries (including India) have not signed the Global Methane Pledge [2021].
 The rainfall pattern in India has changed in the past 30 years, impacting many economic activities such as
agriculture, forestry, and fisheries.
 Earth’s global surface temperature has increased by around 1°C compared with the average in 1850–1900.

Page 647 of 719

  Global Investment Trends Monitor:
→ Global Investment Trends Monitor, No. 43:
 It was published by UNCTAD in 2022.
 Finding:
• Global Foreign Direct Investment (FDI) flows in the 2nd quarter of 2022 were down 31% from the 1st quarter
and 7% less than the quarterly average of 2021. The -ve trend reflects a shift in investor sentiment due to
the food, fuel and finance crises around the world, the 2022 Ukraine war, rising inflation and interest rates,
and fears of a coming recession. Expectations for 2022 full year are for a marked (noticeable) slowdown.
• In line with the downshift in global investment, cross-border investment in climate change mitigation and
adaptation is likely to decline in 2022. The number of new project announcements in the 1 st 3 quarters of
2022 was 7% lower than in 2021 in mitigation, and 12% lower in adaptation sectors.
• Climate change investment showed an upward trend after the adoption of the SDGs in 2015, and a strong
acceleration in 2021, especially in renewable energy. The boom was supported by post-COVID stimulus
investment packages, especially in Europe, and loose financing conditions for international project finance
worldwide. Total project values in 2021 were twice the pre-pandemic level. This momentum is now at risk
in 2022.
• Mitigation projects account for the lion’s share (94%) of international climate investments. Adaptation
projects continue to lag far behind. Most mitigation investments are in renewable energy and, to a lesser
extent, in various energy efficiency projects.
• Developed economies account for 2/3rd of international project finance deals and greenfield investments in
renewables. Europe alone accounts for > 1/2th of renewables projects.
• The shift from fossil-fuel to green investments to support the energy transition risks a setback due to the
loss of momentum in renewables and high oil and gas prices. For now in 2022, the downward trend in
investment is also affecting extractive industries and fossil-fuel-based energy generation, with project
numbers in these sectors about 16% lower in the first 3 quarters of 2022. But high profits of multinationals
in these sectors combined with the energy crisis could lead to a renewed push for investments in dirty
energy.
Value Addition:
 WMO Global Seasonal Climate Update (GSCU):
→ issued quarterly by WMO
→ summarizes current status (monitoring) and expected future behaviour (prediction) of global seasonal
climate focusing on major general circulation features and large‐scale oceanic anomalies around globe
(e.g., El Nino / Southern Oscillation, North Atlantic Oscillation, India n Ocean Dipole, etc.) and their
potential impacts on worldwide surface temperature and precipitation patterns.
 Conference of Parties (COP):
→ supreme governing body of international convention (treaty, written agreement between actors in
international law).
→ It is composed of representatives of member states of convention and accredited observers.
→ Scope of COP is to review implementation of Convention and any other legal instruments that COP adopts
and take decisions necessary to promote effective implementation of Convention.
→ Conventions with COP include:
 Basel Convention [Hazardous waste]
 Chemical Weapons Convention (CWC)
 Convention on Biological Diversity (CBD)
 Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES )
 Kyoto Protocol
 Minamata Convention on Mercury
 Ramsar Convention
 Rotterdam Convention [Hazardous chemical]
 Stockholm Convention on Persistent Organic Pollutants
 Treaty on Non-Proliferation of Nuclear Weapons
 UNCCD
 United Nations Convention against Corruption
 United Nations Framework Convention on Climate Change (UNFCCC)
 United Nations Climate Change conference
 Scientific Advisory Board of UN Secretary-General:
→ Composition:
 scientists representing various fields of natural, social, human sciences.
→ Function:
 to provide advice on science, technology and innovation (STI) for sustainable development to UN
Secretary-General and to Executive Heads of UN organizations.

Page 648 of 719

  Super pollutants / short-lived climate pollutants / forcers:
→ What:
 potent noncarbon-dioxide global warming contaminants
 among most underappreciated but dangerous contributors to climate change
→ Example:
 Methane:
• What: powerful greenhouse gas that is 20 times more potent than carbon dioxide
• Source: Natural gas and petroleum industries, fermentation from livestock, landfills, Coal mining,
wastewater treatment etc.
• Impact: Methane contributes to creation of tropospheric ozone (O3), which can dramatically reduce crop
yields.
 Black Carbon.
 HFCs:
• hundreds to tens of thousands of times more potent than CO2
• fastest-growing greenhouse gases across the world
• manufactured for use in refrigeration, air conditioning, insulation, solvents, aerosol, and fire-protection
products
• Developed and produced as substitutes to ozone-depleting substances (that are being phased out in the
Montreal Protocol)
→ Feature:
 shorter-lived
 remain in the atmosphere for a shorter time than carbon dioxide
→ Impact:
 dangerous for human health and diminish agricultural productivity
→ Way Forward:
 reducing these pollutants now can help reduce temperatures in the near term. In addition, the reduction of
super climate pollutants can be easier than the reduction of carbon dioxide since none of them, unlike CO2, are
a byproduct of our primary sources of energy.
 Asian brown cloud:
→ Large atmospheric brown cloud that occurs annually, mostly during winter, over eastern China; and southern Asia.
→ It is caused by large amounts of aerosols (soot, dust) produced in combustion of fossil fuels, biomass.
 Carbon Watch App:
→ What:
 mobile application that assess carbon footprint of individual.
 India’s 1st app to assess individual’s carbon footprint
 developed by MoEFCC
→ Working mechanism:
 Person downloads this application. Fill details - consumptions etc. in relation to Water, Energy, Waste
Generation, Transport (Vehicular movement). Then, this application calculates carbon footprint of that
individual.
→ Benefit:
 It suggests methods to reduce carbon footprints.
 It suggest methods as per information provided by individuals.
 It will also provide information about avg. national emissionand avg. world emission
→ Motive:
 Making people Climate-Smart Citizens
 Making people access themselves their carbon footprint
 Providing people with steps to reduce carbon footprint.
→ Fact:
 Chandigarh - 1 st State / UT to launch Carbon Watch App.
Glossary:
 Climate equity: Climate equity ensures just distribution of benefits of climate protection efforts and alleviates
unequal burdens created by climate change
Question:
 “Climate Action Tracker” which emission reduction pledges of different countries are Database created by
coalition of research organisations. Climate Action Tracker (CAT) is independent scientific analysis produced by
two research organisations tracking climate action since 2009. It tra cks progress toward globally agreed aim of
holding warming well below 2°C and pursuing efforts to limit warming to 1.5°C.
 ‘Social Cost of Carbon” means Long-term damage done by 1 tonne of CO2 emissions in given year.
 Climate Group is one international non-profit organization that drives climate action by building large networks
and running them. EP100 brings together leading companies committed to driving innovation in energy efficiency
Page 649 of 719
 and increasing competitiveness while delivering on emission reduction g oals. Some Indian companies are
members of EP100. Climate group is international non -profit founded in 2003, with offices in London, New York,
New Delhi, Amsterdam, Beijing. EP100 is global initiative led by Climate Group and Alliance to Save Energy.
EP100 initiative brings together growing group of energy -smart companies committed to improving their energy
productivity and doing more with less GHG emissions. India’s own Mahindra group is one of leaders in cutting
carbon emissions. Climate Group is Secretariat to Under2 Coalition.
Mains Link:
 Discuss the measures required to realize the climate change targets that India had declared to achieve by 2070. (15M)
 Discuss the concept of Carbon Neutrality? Explain its significance. Also, evaluate the feasibility of such a principle for a
developing country like India. (10M)
 Discuss the ways in which India can achieve its ambitious targets of net zero emissions by 2070. (10M)
 Describe the major outcomes of the 26th session of the Conference of the Parties (COP) to the United Nations Framework
Convention on Climate Change (UNFCCC). What are the commitments made by the India conference? (UPSC 2021)
 How far do you think the nature-based solutions a viable option in dealing with climate change in India? Analyze with
suitable illustrations. (250 Words)
 ‘Climate Change’ is a global problem. How India will be affected by climate change? How Himalayan and coastal states of
India will be affected by climate change? (UPSC MAINS 2017)
 Assess the impact of global warming on the coral life system with examples. (UPSC Mains 2019)
 Write a note on Life mission and how it will help reduce global carbon emissions.
 Analyse the growing impacts of climate change on India. Are the steps taken so far adequate enough to tackle climate
change?
 Evaluate India’s response to the climate change crisis. Has India prioritised economic growth over environmental
sustainability? (250 words)

RESERVE BANK OF INDIA (RBI) [1935]

News:
 2021:
→ After maintaining Contingency Risk Buffer, RBI will transfer surplus of about 1 lakh crore to government.
 Significance: It will help government’s finances as India battles coronavirus and economic recovery.
 2022:
→ RBI Board approves transfer of RS. 30,307 crore as surplus to Central Government for accounting year 2021-22. RBI
board also decided to maintain Contingency Risk Buffer at 5.50%.
→ RBI releases its bi-annual Financial Stability Report (FSR).
→ RBI Fraud Registry to check banking frauds : With intent of improving consumer protection amid cases of
digital frauds, RBI is in discussions to set up one fraud registry to create one database of fraudulent
websites, phones and various methods used by fraudsters. Payment system participants will b e provided
access to this registry for near-real time fraud monitoring. Aggregated fraud data will be published to
educate customers on emerging risks.
→ RBI puts Dhanlaxmi Bank under observation due to decreasing CRAR of the Bank.
→ Monetary Policy Committee (MPC) of RBI to convene soon to formulate its response to GOI about the high rate of
inflation in India. (Currenty, in September 2022 inflation is about 7.4% in India, according to RBI source). [RBI is by
law responsible for maintaining price stability. Under the “inflation-targeting” regime that began in 2016, the central
bank is required to target an inflation rate of 4%, with a leeway of 2% points on either side].
 How did RBI fail to check inflation (high inflation in 2020, 2021, 2022)?
• Time lag: RBI MPC’s knowledge of inflation typically lags by 2 months — which means as it deliberates in
October, it works with data until August.
• Accommodative stance of RBI (growth more priority than inflation control): RBI despite being aware about
the inflation level has kept the repo rate unchanged at 4% (now in 1st January 2023, Policy Repo Rate is
6.25% as per RBI website) and to continue with an accommodative stance as long as necessary to revive and
sustain growth on a durable basis.
About:
 What:
→ India's central bank and regulatory body. It is statutory body, estd. by Reserve Bank of India Act, 1934.
→ It is under jurisdiction of Ministry of Finance, Government of India.
→ It is responsible for regulation of Indian banking system. It is responsible for issue and supply of Indian rupee. It also
manages India's main payment systems and works to promote its economic development. Bharatiya Reserve Bank
Note Mudran is one of specialised divisions of RBI through which it prints & mints Indian bank notes and coins. RBI
established NPCI as one of its specialised division to regulate payment and settlement systems in India. Deposit
Insurance and Credit Guarantee Corporation was established by RBI as one of its specialised division for purpose of
providing insurance of deposits and guaranteeing of credit facilities to all Indian banks.
 Composition:

Page 650 of 719

 → Deputy Governors: Appointment by Central govt. (Appointments Committee of the Cabinet). 4 deputy governors
— as per RBI Act 1934. Tenure – 3 years. They are eligible for reappointment.
 Function:
→ issue and supply of Indian rupee
→ regulation of Indian banking system.
→ Management of India's main payment systems
→ working to promote India’s economic development.
→ RBI acts as Monetary manager, Financial system manager, foreign exchange manager, currency manager, payment
system manager, banker to banks, banker to GOI.
 RBI’s Earning & RBI’s Expenditure:
→
{RBI Earning} {RBI Expenditure}
Returns earned on its foreign currency assets (FCA): Printing of currency notes
a. bonds, T-Bills of other central banks
b. top-rated securities
c. deposits with other central banks.
Interest on its holdings of rupee-denominated Spending on its staffs.
government bonds or securities
Interest on lending to banks, for very short tenures, Commission given to banks for undertaking
such as overnight transactions on behalf of government across India.
Commission (fee) charged for handling borrowings of
State governments and central government.
 RBI’s Publications:
→ Consumer Confidence Survey; Inflation Expectations Survey of Households; Financial Stability Report; Monetary
Policy Report; Report on Foreign Exchange Reserves; Reserve Bank of India – Digital Payments Index (RBI-DPI).
 Role of RBI in the functioning of banks:
→ Under Banking Regulation Act, 1949, RBI has the duty to inspect and regulate all commercial banks including Basel
norms, CRR, SLR etc.
 Fact:
→ In view of RBI’s function as lender of last resort, RBI needs to maintain some Contingent Risk Buffer (CRB) to insure
economy against any tail risk of financial stability crisis.
→ 2018 Bimal Jalan committee recommended that RBI maintain 5.5-6.5% of its assets / balance sheet as surplus.
[Transfer of surplus had been in contention between Centre and RBI in past].
→ In FY 2018-19, record largest surplus in history was transferred by RBI to Centre.
Note:
 Reserve Bank of India Act, 1934:
→ Management: Central Government may give necessary directions to Reserve Bank of India (RBI), after consultation
with Governor of RBI, in public interest.
→ Allocation of surplus profits:
 Balance of RBI’s profits shall be paid to Central Government. [Note: Y.H. Malegam Committee, 2013 (adequacy
of reserves and surplus distribution policy of RBI) recommended higher transfer to government.]
 RBI Act mandates that profits made by RBI from its operations be sent to Centre. As manager of Government’s
finances, every year RBI also pays dividend to government to help with finances from its surplus or profit.
 Financial Stability and Development Council (FSDC) [2010]:
→ What:
 It is one autonomous apex-level body (super regulatory body) constituted by GOI to deal with macro prudential
and financial regularities in entire financial sector of India, and to regulate economic assets of India.
 It is not statutory body. No funds are separately allocated to this council.
→ Origin: 1 st mooted by Raghuram Rajan Committee in 2008.
→ Aim:
 Strengthen and institutionalise mechanism of maintaining financial stability, financial sector development, inter-
regulatory coordination.
 Monitoring macro-prudential regulation of economy.
 To prevent economic meltdown.
→ Composition:
 Union Finance Minister (Chairman); Chief Economic Adviser; RBI Governor; SEBI Chairman; PFRDA head; IRDA
head; ….
→ Functions:
 financial stability; inter–regulatory coordination; financial sector development; financial literacy; financial
inclusion; macro economy supervision.
 Financial Stability Report (FSR):

Page 651 of 719

 → What:
 It is one report published by RBI biannually [actually by Financial Stability and Development Council (FSDC-SC),
headed by RBI Governor] and includes contributions from all financial sector regulators. Accordingly, it reflects
collective assessment of Sub Committee of Financial Stability and Development Council (FSDC-SC) on risks to
stability of Indian financial system such as:
• Macrofinancial Risks;
• Domestic Economy and Markets;
• Financial Institutions: Soundness and Resilience;
• Regulatory Initiatives and Other Developments in Financial Sector;
• Assessment of Systemic Risk.
 This report also discusses issues relating to development and regulation of financial sector.
→ 2022 Financial Stability Report (FSR):
 Finding:
• On NPA: Asset quality of banking system has improved with gross NPA (GNPA) ratio declining to 6-year low
of 5.9%. Reason: Banks have reduced GNPA ratio through recoveries, write-offs and reduction in slippages.
• Provisioning Coverage Ratio (PCR): It improved to 70.9%. [PCR is % of funds that any bank sets aside for
losses due to bad debts. High PCR can be beneficial to banks to buffer themselves against losses if NPAs
start increasing faster.]
• Buffer to withstand shocks: Banks, as well as NBFIs, have sufficient capital buffers to withstand shocks, and
support during Covid helped banks arrest their GNPA ratio.
 Concerns raised:
• Global spillover: Example - US rate increase and threat of recession; Ukraine crisis; Oil price rise.
• Risks from Fintech: This report cautioned that arrival of fintech has exposed banking system to new risks
such data privacy, cyber security, consumer protection, competition and compliance with AML (anti-money
laundering) policies. [Indian fintech industry: It is amongst fastest growing Fintech markets in world. India
has highest fintech adoption rate globally (87%), receiving funding of USD 8.53 billion during 2021-22].
• Risk from BigTechs (big technology firms): They can scale up rapidly and pose risk to financial stability, which
can arise from increased disintermediation of incumbent institutions. Moreover, complex intertwined
operational linkages between BigTech firms and financial institutions could lead to concentration and
contagion risks and issues relating to potential anti-competitive behaviour.
• Cryptos ‘clear danger’: RBI Governor termed cryptocurrencies as “clear danger” and anything that derives
value based on make-believe, without any underlying, is just “speculation under sophisticated name”.
 Contingency Risk Buffer (CRB):
→ Risk provisioning made from economic capital so as to cover monetary, fiscal stability, credit and operation risks.
 Reserve Bank – Integrated Ombudsman Scheme [2021]:
→ It is RBI’s ‘One Nation One Ombudsman’ Scheme. It aims to resolve customer grievances in relation to services
provided by all entities regulated by RBI in one expeditious and cost-effective manner. It is integrated consumer
grievance redressal mechanism for addressing service deficiencies in banking, NBFCs and digital payment systems. It
also aims to make alternate dispute redressal mechanism simpler and more responsive to customers of regulated
entities. It integrates existing 3 Ombudsman schemes of RBI namely: Banking Ombudsman Scheme, 2006;
Ombudsman Scheme for Non-Banking Financial Companies (NBFCs), 2018; Ombudsman Scheme for Digital
Transactions, 2019. Under this, 18 lakh complaints were received during 2021-22 and as many as 97.9% of cases
were cleared in FY 2021-22.
Question:
 In India, one responsible for maintaining price stability by controlling inflation is: RBI (not FSDC nor Dept. of Consumer
Affairs).
Mains Link:
 Discuss the mechanism under which RBI transfers surplus to the government.

INFLATION
News:
 2021:
→ RBI says current inflation target of 4%, with +/- 2% tolerance band is appropriate for next 5 years i.e. FY 2021-22 to
FY 2025-26.
→ Govt. of India retains inflation target of 4%, with tolerance band of +/- 2% points for coming 5 years i.e. FY 2021-22
to FY 2025-26.
→ Sri Lanka declares economic emergency to contain inflation [Inflation got huge spike after steep fall in valuation of
Sri Lanka’s currency.
→ India’s retail inflation increases. [This will affect inflation targeting by RBI.]
 2022:

Page 652 of 719

 → In bid to cool inflation in edible oils, Centre allows duty free import of 20 lakh tonnes each of crude soybean oil and
crude sunflower oil for 2022-23, 2023-24.
→ RBI releases State of economy report. As per this repot, even as stagflation risks loom over some of major global
economies, including USA, India is better placed to avoid such risk.
→ US Federal Reserve announces most aggressive interest rate increase in almost 30 years, raising benchmark
borrowing rate by 0.75 % points / 75 basis points to bring down inflation to its target rate of 2% from current 9%.
However, there is fear that such as move may lead to USA going into recession and thus impacting India and world.
 Impact:
• US Fed increasing interest rates may cut inflation to some extent but may not help in reducing food and fuel
price-led inflation, but instead raising interest rates may bring about recession. [Why are so many central
banks, especially US Fed, raising interest rates sharply, and in process risking economic recession, in bid to
control inflation that is caused by higher food and fuel prices? Answer lies in understanding "inflation
expectations"].
→ As inflation continues to remain at elevated levels and above RBI’s target of 6%, with eye on inflation amid
prevailing global uncertainties, RBI announces 50 basis point hike in repo rates to 5.4% — rate at which
RBI lends to commercial banks — thereby taking cumulative rate hike over last 3 months to 140 basis
points. It is one of RBI’s aggressive stance. [This is set to increase lending rates and EMIs of existing home
loan customers]. And, RBI forecasts GDP growth of 7.2% for FY23, and inflation at 6.7% for year 2022-23.
 Reason for Repo Rate hike by RBI:
• Calibrated withdrawal of monetary policy: With inflation expected to remain above elevated levels, MPC
felt further calibrated withdrawal of monetary policy accommodation and accordingly it decided to increase
repo rate by 50 basis point. Calibrated accommodation is to keep inflation within target along with
supporting growth.
• Volatility in global markets: CPI has eased from its surge in early 2022 but remains uncomfortably high and
above target of 6%. Core inflation remains at elevated levels and volatility in global markets (Ukraine war,
oil price high etc.) is impinging on domestic markets including currency.
→ US jobs-recession paradox (Labour market paradox): Normally when US Fed raises its interest rate to
control inflation, it raises fear of recession as consumption and demand decrease (people have less money)
and so unemployment surges. However this time US economy is creating jobs even as Fed is hiking rates.
Recent Trend: Economic output in US is contracting in line with Fed’s rate-tightening but companies are
still hiring. Over past 6 months, jobs have been created in US at rate of nearly half million per month and
unemployment rate (3.5%) is lowest since 1970 in USA.
 Reason: Previous crisis (Covid pandemic-induced 2020 recession, financial crisis of 2007-08, dot-com
bust of 2000-01 in USA) have all been because of excessive debt-related built up in housing and
Internet infrastructure, and it took nearly 1 decade for US economy to absorb them. By contrast, excess
liquidity, not debt, is most likely catalyst for recession trend today in USA. And so US economy is able
to bounce back with more job creation.
 Impact of US Fed hikes’ elsewhere:
• Foreign investors could leave emerging markets like India and invest more in US (greater interest rate).
• Impact on currency markets because of outflows of funds such as depreciation of Rupee.
→ Monetary Policy Committee (MPC) of RBI to convene soon to formulate its response to GOI about the high rate of
inflation in India. (Currenty, in September 2022 inflation is about 7.4% in India, according to RBI source). [RBI is by
law responsible for maintaining price stability. Under the “inflation-targeting” regime that began in 2016, the central
bank is required to target an inflation rate of 4%, with a leeway of 2% points on either side].
 How did RBI fail to check inflation (high inflation in 2020, 2021, 2022)?
• Time lag: RBI MPC’s knowledge of inflation typically lags by 2 months — which means as it deliberates in
October, it works with data until August.
• Accommodative stance of RBI (growth more priority than inflation control): RBI despite being aware about
the inflation level has kept the repo rate unchanged at 4% (now in 1 st January 2023, Policy Repo Rate is
6.25% as per RBI website) and to continue with an accommodative stance as long as necessary to revive and
sustain growth on a durable basis.
About:
 What:
→ In economics, inflation is general increase in prices of goods and services in economy. When general price level rises,
each unit of currency buys fewer goods and services; consequently, inflation corresponds to reduction in purchasing
power of money. Opposite of inflation is deflation, sustained decrease in general price level of goods and services.
→ Inflation is defined as situation where there is sustained, unchecked increase in general price level and fall in
purchasing power of money.
→ Inflation is rate at which prices rise. Example, X% inflation implies general price level was X% more than what it was
in last year.
→ Inflation is indicative of decrease in purchasing power of unit of country’s currency.
→ The general rise in the price level of goods and services is called inflation.
Page 653 of 719
 Causes:
→ Inflation trajectory will depend upon global markets and geopolitical developments (Ex, 2022 Ukraine War).
→ Reason for price rise can be classified under 2 main heads:
 Increase in demand
 Reduced supply.
→ Erosion of currency
→ High global market price
→ Hoarding by traders
→ Decrease in Tourism due to travel restriction etc.
→ Rise in fuel prices (it adds cost of production)
→ Volatility in labour market
→ rise in demand (ex. essential commodities or hoarding amongst masses owing to fear of COVID-19 lockdown)
→ Erratic rainfall pattern
→ …
 Types:
→ Demand Pull Inflation:
 Demand pull inflation arises when aggregate demand in economy becomes more than aggregate supply.
→ Cost push inflation:
 When there is decrease in aggregate supply of goods and services which results in increase in cost of production.
 Measurement:
→ Common measure of inflation is inflation rate, annualized % change in general price index. As prices do not all
increase at same rate, CPI is often used for this purpose. Employment cost index is also used for wages in USA.
→ India:
 Inflation is measured by central government authority, which is in charge of adopting measures to ensure
smooth running of economy. In India, MoSPI measures inflation.
 In India, inflation is primarily measured by 2 main indices:
• WPI (which measures wholesale level price changes)
• CPI (which measures retail-level price changes)
 In India, both WPI and CPI are used to measure inflation.
 Initiative:
→ In India, RBI is the authority to control inflation. RBI is by law responsible for maintaining price stability.
 Impact:
→ Inflation makes commodities costly.
→ Inflation essentially erodes basis on which one makes economic decisions – meaning it reduces value of money. That
is, inflation erodes purchasing power.
 Inflation Targeting (IT):
→ What:
 Target fixation of inflation that country has to follow for certain number of years.
 central banking policy to adjust monetary policy to achieve specified annual rate of inflation.
 Principle of inflation targeting is based on belief that long-term economic growth is best achieved by maintaining
price stability, and price stability is achieved by controlling inflation.
→ Authority:
 According to Reserve Bank of India Act, 1934 (2016 amendment), Government of India, in consultation with RBI,
shall set inflation target once every 5 years.
→ Feature in India:
 Under the “inflation-targeting” regime that began in 2016, RBI must retain the inflation target of 4%, with a
tolerance band of +/- 2%. Thus, for any given month, RBI’s comfort zone for inflation lies between 2% and 6%.
 Under RBI Act, 1934, if the central bank fails to meet the inflation target for 3 consecutive quarters, RBI is
required to provide the following information to GOI:
• reasons for the failure to achieve the inflation target;
• remedial actions proposed to be taken; and
• an estimate of the period within which the inflation target shall be achieved pursuant to the timely
implementation of the proposed remedial actions.
 CPI inflation is considered.
→ Flexible Inflation Targeting (FIT):
 Flexibility in targeting inflation i.e. having tolerance band.
 Lower tolerance limit below 2% will hamper growth.
→ Inflation Targeting Framework:
 After 2016 amendment to Reserve Bank of India Act, 1934, India now has Flexible Inflation Targeting (FIT)
framework.

Page 654 of 719

  For period till 31 March, 2021, Centre notified 4% CPI inflation as target, with upper tolerance limit of 6% and
lower tolerance limit of 2%.
 Inflation Expectations:
→ Question:
 US Fed (or RBI) knows that it cannot reduce food and fuel price-led inflation by raising interest rates and also
know that raising interest rates will bring about recession, or at least hurt growth and employment. Then why it
is still trying to increase interest rate to bring down inflation? Answer lies in something called “inflation
expectations”.
→ What:
 Inflation expectations are simply rate at which people — consumers, businesses, investors — expect prices to
rise in future. They matter because actual inflation depends, in part, on what we expect it to be. For example, if
everyone expects prices to rise, say, 3% over next year, businesses will want to raise prices by (at least) 3%, and
workers and their unions will want similar-sized raises. All else equal, if inflation expectations rise by 1% point,
actual inflation will tend to rise by 1% point as well.
 Simply put, inflation expectations refer to people’s (or households’) expectation of what inflation rate will be in
future. And they matter because this expectation is what determines people’s economic behaviour.
→ Why does US Fed care about inflation expectations?
 Fed’s mandate is to achieve maximum sustainable employment and price stability. It defines price stability as
annual inflation rate of 2% on average. To help achieve this goal, Fed strives to fix inflation expectations at
roughly 2%. Now, if everyone expects Fed to achieve inflation rate of 2%, then consumers and businesses are
less likely to react when inflation climbs temporarily above that level (say, because of oil price hike) or falls below
it temporarily (say, because of recession). This makes it easier for Fed to meet its price stability mandate.
 To stop Wage-price spiral: Cycle in which high inflation drives up inflation expectations, causing workers to
demand wage increases to make up for expected loss of purchasing power. When workers get wage increases,
businesses raise their prices to accommodate increase in wage costs, driving up inflation. Thus, this wage-price
spiral means that when inflation expectations rise, it is difficult to bring down inflation, even if unemployment
is high.
→ How Fed influence inflation expectations?
 One way is to use its monetary policy tools – particularly short-term interest rates – to achieve and maintain
inflation around 2%.
 Fed can also influence expectations with its communications, particularly by elaborating on likely future course
of monetary policy. This strategy is known as forward guidance.
→ Determination:
 Central banks (Fed, RBI) conduct surveys to assess what is happening to inflation expectations.
→ Importance:
 Net effect of individual decisions to purchase now or postpone purchases or ask for higher wages etc. determine
course of country’s economy. Example:
• Chances are we will buy car today when inflation has not yet eroded our purchasing power, if we expect
that car will cost almost 20% more next year and especially so, when we expect our income to go up by just
10% in meantime.
• If we think prices will actually go downing coming year, then we might postpone buying that car, thinking
why waste our money today when we can get same car for cheaper year later.
• If we expect general price level to rise by 10% over coming year, then we might ask our boss for wage raise
of 15%. Because mere 10% raise will, in our view, barely cover us for higher prices that we will have to pay.
To get “real” increment of 5%, we need nominal increment of 15%.
 People’s expectation of inflation often determines what future inflation will be. For example, if people expect
higher inflation in future and advance their purchases now, all of sudden there will be spike in demand, far in
excess of supply, thus causing higher inflation now. [This is why, policymakers try to gauge what is happening to
inflation expectations.]
→ How raising interest rate will bring down inflation expectations?
 Answer lies in understanding that inflation expectations tend to be “backward looking”. RBI explains “backward-
looking” as: Households tend to look at recent food and fuel prices which are salient items in average
consumption basket and they form their opinion about what inflation would be in future. If households believe
that inflation will go up and stay up, they are in effect saying that it is better to prepare for that difficult situation.
That is, these household’s expectations start influencing and get built into price mark-ups, wage negotiations,
rents on houses, transportation costs and prices of services more generally such as personal services like
housekeeping, medical and education fees, entertainment and bus, train and auto fares. Now issue is, what
people buy in their personal capacity is single biggest engine of GDP growth in India, accounting for almost 2/3rd
of India’s GDP in form of private consumption expenditure. So when inflation becomes entrenched in people’s
psyche it becomes more persistent and generalised. This, in turn, would lead to adverse outlook on economy,
business will hold back fresh investment as costs (such as wages) go up and this, in turn, hurts India’s
competitiveness, people pull out money from their savings and put it into non-productive assets such as gold
Page 655 of 719
 and in India’s case since 98% of all gold demand is met from imports, it essentially implies capital going to other
countries.
 While high interest rates may not affect supply side inflation, it does reduce demand for other goods and
services. By disincentivizing borrowing (because it is now costlier), central bank (Fed, RBI) reduces borrowing-
led demand. This does 2 things:
• one, it reduces inflation by bringing down demand (dampen demand-side inflation); and
• two, it gives time for supply to catch up with demand.
→ Impact:
 Reduced investment: Businesses will hold back fresh investment as costs (such as wages) go up. This, in turn,
hurts India’s competitiveness.
 Increase in Gold demand: People pull out money from their savings and put it into non-productive assets such
as gold. In India’s case, since 98% of all gold demand is met from imports, this essentially implies capital going
to other countries.
→ Conclusion:
 In short: Ensuring inflation expectations stay anchored is essential goal for monetary policy. Reducing inflation
is one way to achieve this goal and raising interest rates is one way to achieve lower inflation. RBI also tries to
achieve this same goal of keeping inflation expectations anchored and at around 4%. But as central banks (Fed,
RBI) try to achieve this inflation expectations goal, more interest rate hikes, in turn, will dampen economic
activity.
 Increasing Inflation in India. Reason:
→ Inflation in India cannot be described just as ‘cost-push’. Abundance of liquidity has been one important factor.
→ Rise in prices of crude petroleum, natural gas, mineral oils, basic metals, etc. owing to disruption in global supply
chain caused by 2022 Russia-Ukraine conflict.
→ Retail inflation rose mainly on account of rising prices of essential food items like oils, fats, vegetables, protein-rich
items such as meat, fish.
→ Sharp rise in commodity prices across world is major reason behind inflation spike in India. This is increasing import
cost for some of crucial consumables, pushing inflation higher.
 Impact of higher Inflation in India:
→ High inflation is expected to push up interest rates in banking system.
→ EMIs on home, vehicle, other personal and corporate loans are likely to go up.
→ Deposit rates, mainly fixed term rates, are also set to rise.
→ Consumption and demand can be impacted by Repo rate hike.
→ Hike in CRR will suck out large amount of money from banking system. Lendable resources of banks will come down
accordingly.
→ It also means cost of funds will go up and banks’ net interest margins could get adversely impacted.
 Challenges in tackling Inflation:
→ Borrowing programme will increase, and additional liquidity support may be required.
→ For rise in interest rate to stick, appropriate actions must be taken to contract liquidity. That is what rise in CRR will
do. In absence of rise in CRR, liquidity will have to be sucked by OMO.
→ Liquidity conditions need to be modulated in line with policy action and stance to ensure their full and efficient
transmission to rest of Indian economy.
 Steps by RBI to control inflation:
→ RBI through its MPC controls Inflation with its tools to control Money supply in market. RBI should increase repo rate,
Standing Deposit Facility, Marginal Standing Facility.
→ Impact of increase in rates by RBI:
 Repo rate hike will force banks, NBFCs to increase repo-linked lending rates and minimum cost of funds based
lending rates (MCLR). This is because cost of funds of banks will rise with Repo rate hike. Net result will be further
rise in EMIs of existing borrowers. Moreover, new home, vehicle and personal loans will also become costlier.
 Consumption and demand will be impacted by Repo rate hike.
 Banks will also have to increase deposit rates.
 Way forward
→ Press for faster growth, higher industrial output along with addressing supply bottlenecks.
→ Ensure adequate supply of essential items.
→ To contain inflation on food prices, Govt. should crackdown on supply side if hoarding happens and ease import limits
on pulses, oil seed.
→ prevention of hoarding.
→ Monitor pricing mechanisms
→ Intervention in market through sale of government-held stocks.
Note:
 Cost Inflation Index (CII):
→ What:

Page 656 of 719

  CII is used to estimate increase in prices of goods and assets year-by-year due to inflation.
 CII values reflect average change in prices of goods and assets year on year due to inflation or deflation. It helps
tax payers reduce our tax burden.
→ Feature:
 Reason why CII is calculated: CII is calculated to match prices to inflation rate. In simple words, increase in
inflation rate over time will lead to rise in prices.
 Who notifies CII: Central Government specifies CII by notifying in official gazette. CII = 75% of average rise in CPI
(urban) for immediately preceding year. [CPI compares current price of basket of goods and services (which
represent economy) with cost of same basket of goods and services in previous year to calculate increase in
prices].
→ How CII is used in Income Tax:
 Long-Term Capital Assets are recorded at cost price in books. Despite increasing inflation, they exist at cost price
and cannot be revalued. When these assets are sold, profit amount remains high due to higher sale price as
compared to purchase price. This also leads to higher income tax. CII is applied to Long-Term Capital Assets, due
to which purchase cost increases, resulting in lesser profits and lesser taxes to benefit taxpayers. To benefit
taxpayers, CII benefit is applied to Long-Term Capital Assets, due to which purchase cost increases, resulting in
lesser profits and lesser taxes.
 Deflation:
→ It is opposite of Inflation. It means price decrease which means we can buy things at lower price but, like
inflation, it is also bad for economy. Because:
 every business has fixed cost of production say minimum light bill, phone bill, office rent, staff salary etc. So, if
prices keep falling and falling (say of Nano car), then car maker will suffer losses. He has no motivation to expand
business. He wants to cut down his production costs, by firing some of his employees which means less new jobs
creation and rise in unemployment and then social unrest.
 if prices of everything fall then custom duty, VAT, excise duty, service tax and their collection will also decrease.
Then government will have less money to spend on education, healthcare, social sector, defense, law and order
etc. and which would lead to poverty, disease, crime.
→ It means fall in prices and fall in employment. RBI does not want this.
 Disinflation:
→ It means fall in prices but without causing unemployment. RBI wants this while fighting inflation.
 Reflation:
→ Policy to stop fall in price levels, but without causing rise in price levels (inflation). RBI wants this.
 Stagflation / Recession-inflation:
→ What:
 stagnation + inflation
 In economics, stagflation or recession-inflation is situation in which inflation rate is high or increasing, economic
growth rate slows, and unemployment remains steadily high. It presents dilemma for economic policy, because
actions intended to lower inflation may worsen unemployment.
 It means both prices and wages rise but people cannot find jobs, companies cannot find customers. RBI does
not want this.
 It describes economy with high unemployment and little to no growth even as prices are rising faster than
normal.
 Stagflation is situation in which economy is suffering both increase in inflation and low growth.
→ Origin:
 Stagflation was initially identified in 1970s, when oil shock caused fast inflation and significant unemployment
in many industrialised economies.
 Shrinkflation:
→ practice of reducing size of product while maintaining its sticker price.
→ form of hidden inflation.
→ Raising price per given amount is strategy employed by companies, mainly in food and beverage industries, to
stealthily boost profit margins or maintain them in face of rising input costs.
→ Shrinkflation is also referred to as package downsizing in business and academic research.
→ Shrinkflation is practice of reducing size (or sometimes quality) of product while price of that product remains same
or slightly increases. [Example, in 2022, average pack size of FMCG products in India shrank.]
 Retail inflation:
→ measures changes in prices from retail buyer's perspective
→ it is tracked by CPI
 Wholesale inflation:
→ measures inflation at level of producers
→ tracked by WPI
 Wholesale Price Index (WPI):

Page 657 of 719

 → Goods or services sold by businesses to smaller businesses for selling further are captured by WPI.
 Consumer Price Index (CPI):
→ CPI calculates difference in price of commodities and services such as food, medical care, education, electronics etc,
which Indian consumers buy for use.
Question:
 Which one of following is likely to be most inflationary in its effects?
→ Repayment of Public debt.
→ Borrowing from the public to finance a budget deficit.
→ Borrowing from the banks to finance a budget deficit.
→ Creation of new money to finance a budget deficit.
Ans: Creation of new money to finance a budget deficit. All options are inflationary.
 Steps that can be taken by Government to reduce budget deficit include: Reducing revenue expenditure, Rationalizing
subsidies.
 In India, RBI is responsible for maintaining price stability by controlling inflation.
 One step / remedy to be taken up at time of economic recession, is increase in expenditure on public projects.
 With reference to Indian economy, demand pull-inflation can be caused / increased by?
→ Expansionary policies
→ Fiscal stimulus
→ Inflation-indexing wages
→ Higher – purchasing power
→ Rising interest rates.
Ans: Expansionary policies, Fiscal stimulus, Higher – purchasing power.
 If interest rate is decreased in economy, it will:
→ decrease consumption expenditure in economy
→ increase tax collection of Government
→ increase investment expenditure in economy
→ increase total savings in economy.
Ans: increase investment expenditure in economy. That is, if interest rate is decreased, it becomes easier to borrow
money at low-interest rate and therefore individuals / companies will increase their investment expenditure.
Mains Link:
 Inflation further exacerbates inequalities and affects the poor the most. Discuss the policy measures that are needed to
ensure that inequalities do not deepen amidst rising inflation. (10M)
 Distinguish between demand-pull and cost-push inflation. Examine the factors that are causing inflation in India. What
measures are needed to keep inflation under check? (10M)
 Analyse the impact of recent interest rate hike by US Federal Reserve (Fed)’s on Indian economy. (250 Words)
 What is inflation targeting? From a critical assessment of inflation-targeting by the Reserve Bank of India (RBI) in the
Indian economy.

MONETARY POLICY
News:
 2021:
→ RBI uses variable rate reverse repo auction (VRRR).
 Reason:
• Surplus liquidity (rupee) in system is now high, which needs to be curbed to keep tab on inflation. Usually,
RBI resort to traditional tools such as increasing repo rate, increasing CRR, but this can have negative
implication on economy. Therefore, RBI is now using one different toolkit – variable rate reverse repo
auction (VRRR).
→ RBI halts its bond buying under G-Sec Acquisition Programme (GSAP) for now. [GSAP measure has already succeefully
ensured adequate liquidity and stabilised financial markets]
 2022:
→ Jayant Varma [one member of MPC of RBI], who has been opposing RBI’s accommodative policy stance,
says this stance carries with it risk of falling behind curve in future because this stance limits MPC’s
freedom of action.
→ RBI’s Central Board of Directors approves nomination of Rajiv Ranjan as ex-officio member of MPC.
→ RBI in its bimonthly policy review meeting increases key repo rate by 50 basis points, but made no changes
in CRR. Withdrawal of Accommodative Policy: MPC also decided to remain focused on withdrawal of
accommodation to ensure that inflation remains within target, going forward, while supporting growth.
[This clearly indicates that RBI is in no mood to continue with accommodative stance, and RBI is most likely
to increase rate in its next policy meeting].
→ US Federal Reserve announces most aggressive interest rate increase in almost 30 years, raising benchmark
borrowing rate by 0.75 % points / 75 basis points to bring down inflation to its target rate of 2% from current 9%.
However, there is fear that such as move may lead to USA going into recession and thus impacting India and world.
Page 658 of 719
 [Analysts believe that, over long run, rupee is likely to continue to depreciate against dollar given significant
differences in long run inflation between India and U.S. At moment, as U.S. Federal Reserve raises rates to tackle
historically high inflation in USA, other countries and emerging markets in particular will be forced to raise their own
interest rates to avoid disruptive capital outflows and to protect their currencies. RBI too has been trying to rein in
domestic consumer price inflation by raising rates and tightening liquidity. As interest rates rise across globe, threat
of global recession also rises as economies readjust to tighter monetary conditions].
→ With US' inflation rate at 9.1%, highest in 40 years, 3 key terms: Yield inversion, soft-landing, reverse
currency war are in news. [Given massive gap between current US inflation rate — over 9%— and Fed’s
target inflation rate — 2% — most observers expect that Fed would have to resort to such aggressive
monetary tightening that US economy will end up having hard landing.]
→ As inflation continues to remain at elevated levels and above RBI’s target of 6%, with eye on inflation amid
prevailing global uncertainties, RBI announces 50 basis point hike in repo rates to 5.4% — rate at which
RBI lends to commercial banks — thereby taking cumulative rate hike over last 3 months to 140 basis
points. It is one of RBI’s aggressive stance. [This is set to increase lending rates and EMIs of existing home
loan customers]. And, RBI forecasts GDP growth of 7.2% for FY23, and inflation at 6.7% for year 2022 -23.
 Reason for Repo Rate hike by RBI:
• Calibrated withdrawal of monetary policy: With inflation expected to remain above elevated levels, MPC
felt further calibrated withdrawal of monetary policy accommodation and accordingly it decided to increase
repo rate by 50 basis point. Calibrated accommodation is to keep inflation within target along with
supporting growth.
• Volatility in global markets: CPI has eased from its surge in early 2022 but remains uncomfortably high and
above target of 6%. Core inflation remains at elevated levels and volatility in global markets (Ukraine war,
oil price high etc.) is impinging on domestic markets including currency.
→ Impossible trinity - trilemma has come under focus recently as US Federal Reserve has been raising interest rates to
fight rising prices.
→ Monetary Policy Committee (MPC) of RBI to convene soon to formulate its response to GOI about the high rate of
inflation in India. (Currenty, in September 2022 inflation is about 7.4% in India, according to RBI source). [RBI is by
law responsible for maintaining price stability. Under the “inflation-targeting” regime that began in 2016, the central
bank is required to target an inflation rate of 4%, with a leeway of 2% points on either side].
 How did RBI fail to check inflation (high inflation in 2020, 2021, 2022)?
• Time lag: RBI MPC’s knowledge of inflation typically lags by 2 months — which means as it deliberates in
October, it works with data until August.
• Accommodative stance of RBI (growth more priority than inflation control): RBI despite being aware about
the inflation level has kept the repo rate unchanged at 4% (now in 1 st January 2023, Policy Repo Rate is
6.25% as per RBI website) and to continue with an accommodative stance as long as necessary to revive and
sustain growth on a durable basis.
About:
 What:
→ policy adopted by monetary authority of nation to control:
 interest rate payable for very short-term borrowing (borrowing by banks from each other to meet their short-
term needs); or
 money supply,
often as attempt to reduce interest rate or inflation, so as to ensure price stability, general trust of valu e
and stability of that nation's currency.
→ Policy made by central bank to control money supply in economy. (and thereby fight both inflation and
deflation).
→ It is modification of supply of money i.e.:
 printing more currency (increasing money supply); or
 increasing interest rates or removing excess reserves (decreasing money supply); or
 decreasing interest rates (increasing money supply).
→ In developed countries, monetary policy is generally formed separately from fiscal policy.
 Introduction:
→ Initially people used barter system for trading. But barter system had many problems. Therefore, people
switched to money system. There are 2 types of financial intermediaries (middlemen who help in circular
flow of money between households and business fi rms):
 Banking Institution; and
 NBFI.
RBI controls (all) banks and (some) NBFI. RBI’s main job is to control Money supply, and thereby fight
inflation (which is price rise and is bad for economy) and deflation.
 Objective:
→ Ensure price stability
→ Ensure general trust of value and stability of currency.
Page 659 of 719
 Type:
→ Expansionary:
 increasing amount of currency in circulation in economy.
 Expansionary policy occurs when monetary authority uses its procedures to stimulate economy.
 Expansionary policy maintains short-term interest rates at lower than usual rate or increases total supply of
money in economy more rapidly than usual.
 It is traditionally used to try to reduce unemployment during recession by decreasing interest rates in hope that
less expensive credit will attract businesses into borrowing more money and thereby expanding. This would
increase aggregate demand (overall demand for all goods and services in economy), which would increase short-
term growth.
 Expansionary monetary policy, being increased amount of currency in circulation, usually diminishes value of
currency relative to other currencies (exchange rate), in which case foreign purchasers will be able to purchase
more with their currency in country with devalued currency and thus increasing exports.
 But, it increases inflation.
→ Contractionary:
 Contractionary policy maintains short-term interest rates greater than usual, slows rate of growth of money
supply, or even decreases it to slow short-term economic growth and lessen inflation.
 Contractionary policy can result in increased unemployment and depressed borrowing and spending by
consumers and businesses, which can eventually result in economic recession if implemented too much.
 Significance:
→ Monetary policy is also used:
 to achieve stability of GDP
 to achieve / maintain low unemployment
 to maintain predictable exchange rates with other currencies.
 Monetary policy vs Fiscal policy:
→ Monetary policy is in contrast to fiscal policy.
→ Monetary policy relies on printing currency and changing interest rates. Fiscal policy relies on taxation,
government spending, government borrowing as methods by government to manage business cycle
phenomena like recessions.
→ Monetary policy refers to central bank activities that are directed toward influencing the quantity of
money and credit in an economy. By contrast, fiscal policy refers to the government’s decisions about
taxation and spending. Both monetary and fiscal policies are used to regulate economic activity over time.
 RBI [India]:
→ Monetary Policy (RBI):
 What:
• RBI’s Monetary Policy is policy pertaining to deployment of monetary resources under its control for
purpose of achieving GDP growth and lowering inflation rate.
• Reserve Bank of India Act, 1934 empowers RBI to make monetary policy. RBI implements monetary policy
using certain tools - Quantitative tool, Qualitative tool.
 Objective:
• Primary objective is maintaining price stability while keeping in mind the objective of economic growth.
• Financial stability.
• Foreign Exchange Market stability.
 Concern:
• While Government of India tries to accelerate GDP growth rate of India by supplying money, RBI keeps trying
to bring down rate of inflation within sustainable limit.
→ Monetary Policy Committee (MPC) [2016]:
 What:
• constituted by Central Government by amending Reserve Bank of India Act, 1934 via Finance Act, 2016.
• RBI has one MPC [constituted by Government].
• RBI Committee that fixes benchmark interest rate in India.
• Meetings are held at least 4 times per year (specifically, at least once in one QUARTER) and it publishes its
decisions after each such meeting.
• RBI’s MPC frames monetary policy using tools like repo rate, reverse repo rate, bank rate, CRR.
 Functions:
• Decides different policy rates like MSF, Repo Rate, Reverse Repo Rate, Liquidity Adjustment Facility (LAF).
• MPC determines ideal policy interest rate that will help achieve inflation target of India.
 Composition:
• Total 6 members.
• Out of total 6 members, government nominates 3. No government official will be nominated to MPC.

Page 660 of 719

 •Other 3 members would be from RBI with RBI governor being ex-officio chairperson, Deputy governor of
RBI in charge of monetary policy will be member, and executive director of RBI.
 Selection:
• Centre’s nominees to MPC will be selected by Search-cum-Selection Committee.
 Search-cum-Selection Committee:
o Cabinet Secretary – head
o RBI Governor
o Economic Affairs Secretary
o 3 experts in field of economics or banking or finance or monetary policy.
 Term:
• 4 years
• not eligible for reappointment.
 Decisions of MPC:
• Decisions will be taken by majority vote with each member having 1 vote.
• RBI governor’s role:
 RBI Governor will chair MPC. RBI governor, however, will not enjoy veto power to overrule other panel
members, but will have casting vote in case of tie.
→ RBI Monetary Policy Instruments:
 Quantitative tools:
• Type:
 Direct Quantitative tools:
o Cash Reserve Ratio (CRR)
o Statutory Liquidity Ratio (SLR)
o Refinance facility
 Indirect Quantitative tools:
o Bank Rate
o Marginal standing facility (MSF)
o MCLR
o Open Market Operations (OMO)
o Long Term Repo Operation (LTRO)
o Market Stabilisation Scheme (MSS)
o Liquidity Adjustment Facility (LAF):
✓ Repo Rate
✓ Reverse Repo Rate
• Reach:
 Reach of Quantitative tools is general. They affect money supply in entire economy and all sectors be
it housing, automobile, manufacturing - everything.
• Impact:
 Indirect in nature as any change in these tools may not transmit to consumer immediately or directly
(That is, even if RBI changes repo rate, it is not necessary banks will immediately change its base rate /
loan interest rates).
 In developing countries like India, most people park their money in only 4 things: Savings Account, Fixed
Deposit (FD), Pension funds, LIC. India has mutual funds, NPS, many equity savings scheme, but most
people (particularly older generation) feels insecure in into such new things. Therefore, lot of money
flows into Savings accounts, fixed deposits and which are Scheduled Commercial banks’ main source of
money. But, In advanced economies, like USA, people do not invest large portion of their income in
savings account or FD. They’ve variety of investment options. So, for American banks, their own Central
bank (US Feds) is significant money supplier. Hence US Feds’ monetary policy shows faster impact on
their American Banks, than RBI’s monetary policy on banks in India.
 Qualitative tools:
• What:
 Qualitative tools are also known as Selective Tools of Monetary Policy.
 Qualitative Tools of Monetary Policy is set of instruments used by RBI which discriminates use and
allocation of credit to different sectors of economy (for credit control). For example, RBI guidelines to
incentivize lending to certain sectors like small businesses, housing sector, automotive sector.
 Qualitative instruments are selective instruments of RBI's monetary policy. These instruments are used
to distinguish between different types of credit, such as preferring export over import, preferring
essential credit supply over non-essential credit supply.
• Feature:
 Both borrowers and lenders are affected by this strategy.
 Amount of money in circulation is unaffected. Available funds are simply directed in certain direction.
• Types:
Page 661 of 719
  Change in Marginal Requirement:
o What:
✓ Term "margin" refers to % of loan that is not offered or financed by bank. Change in loan size
can be caused by change in marginal requirement.
o Feature:
✓ This tool is used to boost credit supply for necessary sectors while discouraging it for non-
essential ones. This can be accomplished by raising marginal of unneeded sectors while
lowering marginal of sectors in need. If RBI believes that additional credit should be available
to agricultural sector, margin will be reduced, and 80-90 % of loan will be available. For
Instance, if marginal requirement for agricultural sector is 10% and if someone pledges
collateral worth 10 crores for loan of 10 crores, then sanctioned loan would be maximum of 9
crores. On other hand, if automotive sector has marginal requirement of 20%, for same
collateral and loan sanctioned amount will be 8 crores.
o Usage:
✓ Using this tool, RBI can control money supply. Example: during inflation, RBI should increase
margin requirement, which means banks has less money to lend -> businessmen can borrow
less -> less job -> less income -> less demand -> prices reduced.
o Significance:
✓ If RBI changes repo rate, it is not compulsory for banks to change their interest rates (as banks
are not entirely dependent, in terms of money, on RBI). But if RBI changes margin
requirements, then banks must obey this change in margin requirement. Thus, this tool has
direct impact on money supply.
 Regulation of Consumer Credit:
o What:
✓ Consumer credit (Consumer credit is personal debt taken on to purchase goods and services.
Credit card is one form of consumer credit) supply is regulated by instalment of sale and hire
purchase of consumer goods. Features such as instalment amount, down payment, loan
period, and so on are all pre-determined, which aids in control of credit and inflation in India.
For Instance, for home loan, RBI can set minimum down payment limit of 15%. Therefore, for
home loan of 1 crore, Rs. 15 lakhs must be paid as down payment and avail 85 lakhs as loan.
o Usage:
✓ RBI can regulate Consumer Credit to fight inflation. Example, RBI can increase downpayment
-> banks can give less loan and Customer himself has to arrange lot of money from his own
pocket. Also, RBI can make rule increasing minimum EMI limit below which banks cannot
accept EMI on loan.
 Selective Credit control:
o Under this, RBI can specifically instruct bankers not to give loans to selective sector say traders of
certain commodities e.g. sugar, gur, edible oil etc, even if said traders are ready to mortgage his
shares / bonds / factory / machine / vehicle etc. This prevents speculations / hoarding of
commodities using money borrowed from banks.
o Example, banks might be instructed by RBI not to lend to traders of Onion and Potato in spite of
having eligibility and collateral pledging capacity. This is to ensure there is no hoarding of essential
commodities by using bank loans.
 Moral Suasion:
o Moral suasion refers to RBI's recommendations to commercial banks that aid in restraint of credit
during inflationary periods. RBI exerts pressure on Indian banking system without taking any
concrete steps to ensure compliance with rules. Commercial banks are informed of RBI's
expectations through monetary policy. Under moral suasion, RBI can offer orders,
recommendations, and suggestions to commercial banks to reduce loan supply for speculative
purposes. For Instance, RBI Governor making press statement that reduction in repo rates have
not been transferred to consumers. This will push gently banks to reduce their interest rates.
o Example, RBI can say ask banks to reduce giving automobile loans and instead to park their money
in government securities. After reducing its repo rate, RBI can ask banks to reduce their base rate.
o RBI may try to influence banks via - direct meetings, conference, giving media statements, giving
speeches at public seminars, university convocations etc. (even where bankers are not present.)
RBI can do so, to build public opinion, media opinion and influence banks by making them feel
guilty.
 Direct Action:
o RBI can punish and impose sanctions on banks for not following its guidelines provided under
monetary policy. For Instance, imposition of PCA Framework is one such Direct Action measure.
o RBI can give punishment to erring banks. Punishment can involve: penal interest, refusing to lend
them money from LAF etc. and in worst case even can cancel their banking licenses.
• Reach:
Page 662 of 719
  Reach of Qualitative tools is selective. It can affect money supply in specific sector of economy like
automobile or agriculture.
• Impact:
 Direct in nature as any changes are directly impacting consumers, for example – requirement of down
payment.
• Significance:
 These instruments have impact on how credit is used in various sectors. For example, RBI can set upper
limits on how much money banks can lend to specific sectors of economy.
 RBI uses Qualitative tools to directly control credit flow to any sector of economy based on
macroeconomic situations. Qualitative tools don't increase or decrease money supply or liquidity in
economy rather channel available money to needed sectors of economy.
→ Monetary Policy’s limitations:
 In developing countries, Monetary policy fails to bring quick results because:
• People do not have many investment alternatives. Commercial banks have large deposits. RBI is not main
or even prominent money supplier for these banks. Whatever RBI does, its effect will be felt only after some
months but by that time, new factors would cause another rise in inflation and RBI will have to start from
scratch again.
• Non-Monetized economy: In rural areas, many transactions are still of barter nature. (E.g. kiranawalla cum
middleman supplies seeds, pesticides, fertilizers in exchange of share in farmer’s produce.)
• Lack of financial inclusion. Since many people are not in banking net, they rely on moneylenders. Many of
them circulate black money of cops and politicians, and charge high interest rate on loans. RBI has no control
over them.
• Monsoon uncertainty, cyclone, flood, draughts, and their effect on food production. Food inflation means
newspaper walla, washerman, barber, car mechanic etc. will raise their service fees to accommodate their
raised cost of living. RBI has no control over them.
• Crude oil and gold imports are hurt when rupee weakens. RBI can try to decrease depreciation of rupee
against dollar but RBI does not have enough forex reserves to decrease further.
• Fiscal deficit, illogical schemes: Example, MNREGA worker digs one temporary road. But, after rain, road is
wiped out which means physical infrastructure is not added to economy but wage was raised. This mismatch
leads to more inflation.
• Subsidy leakage, Black money, underground economy, etc.
→ Monetary Policy and Inflation:
 Limitation of monetary policy in curbing inflation:
• Incomplete transmission: It means that the cumulative easing in policy rates (repo rates, etc.) by RBI is not
being reflected in lowering of lending rates by banks.
• Policy rates are not market linked: Repo Rate decided by MPC is not truly market linked which results in
banks many times negating these policy rates set by RBI.
• Cost-push inflation: Due to disruption in the supply chain of the produce e.g. 2022 Russia-Ukraine war.
Ineffective against supply shocks i.e. RBI’s policies can stabilize inflation only caused due to demand shocks
and they are ineffective against supply shocks. For instance, food inflation is prone to supply-side
bottlenecks and is out of the scope of any remedy under the aegis of the monetary policy of RBI.
• Limited financial inclusion: India suffers from limited financial inclusion. Indians, unlike Americans, earn
before spending and do not live by credit. This limits the success of RBI’s credit control policy.
• Fiscal policy: Many times there is no synchronisation between monetary and fiscal policies. [GOI and State
Governments can play a progressively active role to help curb inflation by framing new policies or altering
the old ones].
• Globalisation: With the current uncertainty about the global economy in 2022, especially in USA and the
Eurozone due to the 2022 Russia – Ukraine war, RBI should not rely on monetary tools alone to combat
inflation.
 Devaluation:
→ What:
 In macroeconomics and modern monetary policy, devaluation is official lowering of value of country's currency
within fixed exchange-rate system, in which monetary authority formally sets lower exchange rate of national
currency in relation to foreign reference currency or currency basket. Opposite of devaluation, change in
exchange rate making domestic currency more expensive, is called revaluation. Monetary authority (e.g., central
bank) maintains fixed value of its currency by being ready to buy or sell foreign currency with domestic currency
at stated rate; devaluation is indication that monetary authority will buy and sell foreign currency at lower rate.
However, under floating exchange rate system (in which exchange rates are determined by market
forces acting on foreign exchange market, and not by government or central bank policy actions), decrease in
currency's value relative to other major currency benchmarks is instead called depreciation; likewise, increase
in currency's value is called appreciation.

Page 663 of 719

  Devaluation is deliberate downward adjustment of value of country's money relative to another currency, group
of currencies, or currency standard. Countries that have fixed exchange rate or semi-fixed exchange rate use
this monetary policy tool.
→ Benefit:
 Devaluing currency reduces cost of country's exports and can help shrink trade deficits.
→ Downside:
 While devaluing currency may be attractive option, it can have -ve consequences. Increasing price of imports
protects domestic industries, but they may become less efficient without pressure of competition.
 Higher exports relative to imports can also increase aggregate demand, which can lead to higher GDP and
inflation. Inflation can occur because imports become more expensive. Aggregate demand causes demand-pull
inflation, and manufacturers may have less incentive to cut costs because exports are cheaper, increasing cost
of products and services over time.
→ Note:
 Related but distinct concepts include inflation, which is market-determined decline in value of currency in terms
of goods and services (related to its purchasing power). Altering face value of currency without reducing its
exchange rate is redenomination, not devaluation or revaluation.
→ Currency war:
 What:
• One condition in international affairs where countries seek to gain trade advantage over other countries by
causing exchange rate of their currencies to fall in relation to other currencies. As exchange rate of country's
currency falls, exports become more competitive in other countries (exports become cheaper relative to
competitors, boosting demand from abroad), and imports into that country become more and more
expensive. Both effects benefit domestic industry, and thus employment, which receives boost in demand
from both domestic and foreign markets. However, price increases for import goods (as well as in cost of
foreign travel) are unpopular as they harm citizens' purchasing power; and when all countries adopt similar
strategy, it can lead to general decline in international trade, harming all countries.
• Currency war is escalation of currency devaluation policies among two or more nations, each of which is
trying to stimulate its own economy. Currency prices fluctuate constantly in foreign exchange market.
However, currency war is marked by number of nations simultaneously engaged in policy decisions aimed
at devaluing their own currencies. Currency war is tit-for-tat policy of official currency devaluation aimed at
improving each nation's foreign trade competitiveness at expense of other nations. Currency devaluation is
deliberate move to reduce purchasing power of nation's own currency.
• Currency war is sometimes referred to by less-threatening term "competitive devaluation."
 Why?
• Nations devalue their currencies primarily to make their own exports more attractive on world market.
Countries may pursue such strategy to gain competitive edge in global trade and reduce their sovereign
debt burden.
 Tool:
• Direct government intervention i.e. imposition of capital controls; Indirectly i.e. quantitative easing; …
 Benefit:
• Currency devaluations can stimulate economy.
 Impact:
• One country adopting this strategy may force other countries to adopt same. When all countries adopt
similar strategy, it can lead to general decline in international trade, harming all countries.
• Devaluation can have unintended consequences that are self-defeating. Worst of these is inflation. Nation's
consumers bear burden of higher prices on imports.
• Degree of currency depreciation may be greater than what is desired, which may cause rising inflation and
capital outflows. Devaluation may lead to demands for greater protectionism and erection of trade barriers,
which would prevent global trade. Devaluation can increase currency's volatility in markets, which in turn
leads to higher hedging costs for companies and even decline in foreign investment.
• Currency depreciation is not solution for all economic problems. Brazil is one case in point. Brazil's attempts
to solve its economic problems by devaluing Brazilian real (its official currency) created hyperinflation and
destroyed Brazil's domestic economy.
 Trend:
• Historically, it has been rare as countries have generally preferred to maintain high value for their
currencies. Countries have generally allowed market forces to work, or have participated in systems of
managed exchanges rates.
• Recent examples, between USA and China over yuan devaluation, Eurozone vs Japan over Yen devaluation.
 Reverse currency war:
• What:

Page 664 of 719

  Situation in which countries work to make their currency stronger. Rather than boosting growth, goal
of any such move is to help tame inflation, since stronger currency means that imports are relatively
cheaper.
• Example:
 US Fed rise of interest rate in 2022:
o As US FED rate increases, investor finds it more attractive and less risky. So, more and more
investors are rushing to invest money in USA. This, in turn, has made dollar become stronger than
all other currencies.
Relative weakness of other countries’ local currencies against dollar makes their exports more
competitive. This can be good for their economies. However, here in this case, every other central
banks are trying to counter US Fed and raise interest rates themselves in order to ensure their
currency does not lose too much value against dollar. This has been termed ‘reverse currency war’.
E.g. India being import dependent, its weaker currency (rupee) would mean higher import bill and
therefore RBI is trying to defend Indian Rupee against Dollar.
Note:
 Clients of RBI:
→ RBI’s clients are: Central Government, State governments, NBFI.
 Deflation:
→ It is opposite of Inflation. It means price decrease which means we can buy things at lower price but, like
inflation, it is also bad for economy. Because:
 every business has fixed cost of production say minimum light bill, phone bill, office rent, staff salary etc. So, if
prices keep falling and falling (say of Nano car), then car maker will suffer losses. He has no motivation to expand
business. He wants to cut down his production costs, by firing some of his employees which means less new jobs
creation and rise in unemployment and then social unrest.
 if prices of everything fall then custom duty, VAT, excise duty, service tax and their collection will also decrease.
Then government will have less money to spend on education, healthcare, social sector, defense, law and order
etc. and which would lead to poverty, disease, crime.
→ It means fall in prices and fall in employment. RBI does not want this.
 Disinflation:
→ It means fall in prices but without causing unemployment. RBI wants this while fighting inflation.
 Reflation:
→ Policy to stop fall in price levels, but without causing rise in price levels (inflation). RBI wants this.
 Statutory Liquidity Ratio (SLR):
→ What:
 Amount that Bank must set aside into gold or RBI approved securities. SLR is kept with bank itself (in non-cash).
 SLR is minimum % of deposits that commercial bank must keep in liquid cash, gold, or other securities. It is
essentially reserve requirement that banks must meet before they may extend credit to customers.
 Banking Regulation Act, 1949 established SLR.
 SLR is minimum % of deposits i.e., Net Demand and Time Liabilities (NDTL)) that commercial bank must keep
with itself.
→ Objective:
 To control bank credit, changing SLR would change bank credit availability.
 In case of solvency of commercial banks, SLR will help in repaying stakeholders.
 Changing SLR indicates macroeconomic conditions and what to expect from other instruments of monetary
policy.
 By making banks invest in government securities, government has enough financial resources.
→ Form:
 This SLR asset can be in form of following:
• Cash
• Gold valued at price not exceeding current price.
• Government securities and T-Bills (In case of securities, bank can only hold government securities and
cannot invest in any private stocks.)
→ Feature:
 Under SLR, commercial banks are mandated by RBI to maintain stipulated proportion of their deposits in form
of liquid assets like cash, gold and unencumbered (free from debt) securities.
 Banks cannot use RBI approved securities kept under SLR to borrow money from RBI under Repo transaction.
But Banks can use securities kept under SLR to borrow money from RBI under MSF. (That is, SLR cannot be used
in Repo transaction but can be used in MSF transaction).
 RBI is authorized to set SLR and change it with changing macroeconomic conditions.
 Bank is liable to pay penalty to RBI if it fails to maintain prescribed SLR. On deficient amount for that particular
day, defaulter bank must pay penalty of about 3% above bank rate.

Page 665 of 719

  2007 amendment to Banking Regulation Act, 1949 removed lower ceiling of SLR which implied it can be between
0-X% of NDTL of bank.
 As of 2021, SLR is at 18.00% of NDTL of bank.
→ Usage:
 SLR is used to fight inflation: When RBI increases SLR, money left with banks to lend is reduced. In turn, banks
will increase their interest rate (loan interest rate) (so as to keep about same profit margin). This in turn make
businessmen to borrow less money from banks -> no new business, no expansion of existing business, less job,
less income, less demand of goods and services -> price decrease (reduction in inflation).
 SLR is used to fight deflation: When RBI decreases SLR, money left with banks to lend is increased. In turn, banks
will decrease their interest rate (loan interest rate). This in turn make businessmen to borrow more money from
banks -> new business, expansion of existing business, more job, more income, more demand of goods and
services -> price increase (reduction in deflation).
 To keep bank credit under control, RBI raises SLR as inflation rises. During recession, RBI lowers SLR to promote
bank credit.
 CRR and SLR have long been used by RBI to limit credit growth, liquidity flow, inflation in economy.
→ Concern:
 High SLR is concern though if may curb inflation because high SLR means banks have less money to lend which
would hamper economic growth. This is why RBI uses usually Repo rate and not SLR to tackle inflation.
→ Significance:
 Since SLR is not changed frequently to control liquidity in economy, it is safe option for banks to invest in and
earn interest when borrowing is poor in economy.
 Cash Reserve Ratio (CRR):
→ What:
 Amount that Bank must set aside as reserve (in cash) and kept with RBI. Bank cannot lend it to anyone. Bank
earns no interest rate or profit on this.
 CRR is minimum % of total deposits (i.e., NDTL) that commercial bank is required to retain as cash reserves with
RBI. In simple words, CRR is cash deposit bank maintains with RBI.
→ Objective:
 RBI, which holds portion of bank's deposits, assures that money is safe. It makes it simple for clients to get their
deposits refunded.
 CRR aids in control of inflation. When economy is experiencing significant inflation, RBI raises CRR, forcing banks
to maintain more money in reserves, reducing their ability to lend.
→ Feature:
 CRR is governed by Reserve Bank of India Act, 1934.
 CRR must be in form of Cash.
 It is applicable to all Scheduled commercial banks. For Instance, let us consider that Bank A has received 100
Crores as Deposits. If we have CRR of 3% then Bank A must deposit 3 crores in Cash form with RBI and is left with
97 crores for its operation.
 When RBI raises CRR, amount of money accessible to banks reduces or falls and vice-versa.
 CRR must be placed in vault in bank or placed with RBI.
 Lower ceiling of CRR was removed by amendment.
 As of 2021, CRR is maintained at 3%.
→ Incremental CRR:
 This RBI tool is used when banks see sudden surplus of deposits. This would lead to banks lending more and
infusing more money in economy and creating inflation. Therefore different CRR is used for deposits from
particular date, to ensure that excess liquidity is absorbed by RBI in form of Incremental CRR. Example, post
demonetization, RBI imposed 100% CRR for deposits between September 16 and November 11 in Scheduled
Commercial Banks.
→ Usage:
 CRR is used to fight inflation: When RBI increases CRR, money left with banks to lend is reduced. In turn, banks
will increase their interest rate (loan interest rate) (so as to keep about same profit margin). This in turn make
businessmen to borrow less money from banks -> no new business, no expansion of existing business, less job,
less income, less demand of goods and services -> price decrease (reduction in inflation).
 CRR is used to fight deflation: When RBI decreases CRR, money left with banks to lend is increased. In turn, banks
will decrease their interest rate (loan interest rate). This in turn make businessmen to borrow more money from
banks -> new business, expansion of existing business, more job, more income, more demand of goods and
services -> price increase (reduction in deflation).
→ Concern:
 High CRR is concern though if may curb inflation because high CRR means banks have less money to lend which
would hamper economic growth. This is why RBI uses usually Repo rate and not CRR to tackle inflation.
→ Significance:

Page 666 of 719

  CRR is short-term liquidity management tool, unlike SLR which is long-term tool.
 CRR is like insurance if bank fails which can be used to repay stakeholders. It is used to push excess liquidity into
markets during slowdowns.

{SLR} {CRR}
{Meaning} minimum % of deposits (NDTL) that % of deposits (NDTL) that commercial
commercial bank must keep with bank is required to retain as cash
itself. reserves with RBI.
{Reserves form} Liquid cash, gold, other securities Cash Only
{Maintained with} Bank RBI
{Effect} Controls excess money flow in Helps meet short term liquidity
economy. requirements by trading excess
securities.
{Interest on Reserve} Banks earns interest based on Banks do not earn any interest on CRR
portfolio of SLR chosen. deposited with RBI.
 Liquidity Adjustment Facility (LAF):
→ What:
 One monetary policy tool used largely by RBI that allows banks to borrow money via repurchase
agreements (repos) or make loans to RBI via reverse repo agreements .
 One monetary policy tool used largely by RBI that controls liquidity or money supply in economy. RBI
does it by either allowing banks to borrow money via repurchase agreements (repos) or lend loans to
RBI via reverse repo agreements.
 Herein, Banks must give RBI government securities as collateral when banks borrow money ( short
term) from RBI. If banks do not repay money on time, RBI can sell these securities [in open market
operations (OMO)] and recover money.
→ Origin:
 LAF was recommended by Narasimhan Committee on Banking Reforms and was introduced by RBI in
1998.
→ Objective:
 LAF reduces liquidity demands and ensures financial market stability.
 LAF allows banks to use repurchase agreements, or repos, to overcome temporary cash shortages.
→ Component:
 Repo
 Reverse Repo
→ Significance:
 LAF structure is helpful in reducing liquidity demands and ensuring financial market fundamental
stability.
 LAF is one monetary policy tool along with CRR, SLR, OMO to control liquidity in economy. RBI uses
these tools based on different circumstances in economy.
 Repo (Repurchasing Option):
→ What:
 Contract (market instrument) between 2 parties when 1 party gives credible security to other as collateral to
avail short term (1 day) loan. At end of time period, loan is repaid and security is repurchased. Borrower pays
interest rate called repo rate.
→ Repo under RBI’s monetary policy:
 Though repo is market instrument, it is most popular as monetary policy or liquidity exercise. Under RBI repo,
commercial banks take 1 day or overnight loans from RBI by giving eligible securities as collateral. After 1 day,
banks pay interest called repo rate, and securities are repurchased from RBI.
 RBI Repo operation is very useful in monetary policy because:
• It helps RBI to influence economy and interest rate of commercial banks through repo rate.
• It helps banks to reduce their liquidity problems.
→ Repo rate / Repurchasing Option Rate:
 What:
• Repo Rate is rate at which RBI lends to banks.
• Interest rate charged by RBI on overnight loans given to commercial banks under Liquidity Adjustment
Facility (LAF).
• Repo rate is interest rate anchor.
• Rate at which commercial banks borrow money by selling their securities to RBI to maintain
liquidity, in case of shortage of funds or due to some statutory measures.
• Repo Rate is rate at which RBI lends to banks by buying securities with agreement that bank will
buy back on certain date. Repo lending is short-term lending option to meet liquidity requirements
Page 667 of 719
 of commercial banks. Repo rate is rate at which RBI lends to other banks. It is part of Liquidity
Adjustment Facility (LAF) of RBI.
 Objective:
• Inflation:
 Repo rate is used as tool to control inflation by increasing repo rate. During periods of high inflation,
RBI makes concerted efforts to reduce flow of money in economy. One way to accomplish this is to
increase repo rate. Borrowing becomes more expensive for businesses and industries as result, slowing
investment and money supply in market. As result, it has negative impact on economic growth, which
aids in control of inflation.
• Liquidity:
 Repo rate is tweaked to increase or decrease liquidity to alter demand in economy based on
macroeconomic scenario. When RBI needs to inject funds into system, it lowers repo rate. As result,
borrowing money for various investment purposes becomes less expensive for businesses and
industries. It also expands economy's overall money supply. This, in turn, boosts economy's growth
rate.
 Component:
• Preventing "squeeze" in economy: RBI adjusts Repo rate in response to inflation. As result, it seeks
to govern economy by keeping inflation under control.
• Hedging and Leverage: RBI tries to hedge and leverage by purchasing securities and bonds from
banks and providing cash in exchange for collateral deposited.
• Short-Term Borrowing: RBI lends money for short length of time, up to overnight period, after
which banks purchase back their deposited securities at predetermined price.
• Collateral and Securities: RBI takes gold, bonds, other forms of collateral.
• Cash Reserve or Liquidity: Banks borrow money from RBI to preserve liquidity or cash reserves as
precautionary measure.
 Feature:
• Banks must buy at later date that same securities given to RBI, during repo transaction, at later
date as on that date mentioned in that securities. (Re -purchase agreement).
• Repo rate borrowing is generally available at overnight repo, and 7 days, 14-day repo (term repos).
• Commercial banks make repurchase agreement with RBI and sell G -secs and buy back at different
rate on agreed price.
• Increased repo rate will discourage banks to borrow from RBI and lending to customers. This in
turn will reduce liquidity and demand in market. It is part of contractionary monetary policy. On
other hand, decreased repo rate will encourage banks to borrow and lend to customers increasing
liquidity and demand in market. This is part of Expansionary Monetary Policy.
 Procedure:
• Under repo transaction between RBI and commercial banks:
 Banks give eligible securities [securities identified by RBI (like government bonds) and at same time
which are above SLR limit) as collateral to RBI.
 RBI gives 1 day / overnight loan to banks and charges interest rate called repo rate from bank.
 Bank repays loan after 1 day and repurchases security from RBI it had given as collateral.
 Usage:
• RBI does not use Bank rate much, to control money supply. RBI does not decide Reverse repo and MSF
because they are automatically -1% and +1% of Repo rate respectively. Thus, only thing RBI has to decide
under monetary policy is Repo rate. Therefore, Repo rate is called “policy rate”.
 Repo rate and Inflation:
• At times of high inflation, RBI increases the repo rate (“dear money policy” - monetary policy by the central
bank where it sets high interest rates so that credit is not easily available to the general public in order to
decrease the rate of inflation in the economy by curbing demand) which results in costlier borrowing both
for consumers and producers which reduces demand in the economy and effectively slows down economic
activity in the economy.
 Significance:
• It is used as policy rate or interest rate anchor by RBI to target inflation. Here, when repo rate is changed, it
will bring corresponding change in lending rates of commercial banks.
• Repo rate is interest rate anchor (short-term) and is used by RBI to target inflation.
• It is most important monetary policy tool of RBI and because of its importance, repo rate is known as policy
rate.
• Under inflation targeting monetary policy framework, repo rate is considered as only policy instrument to
influence targeted inflation and thus to achieve price stability.
• It is one of main tools of RBI to keep inflation under control.
→ Reverse Repo Rate:

Page 668 of 719

  What:
• Reverse Repo Rate is rate at which RBI borrows from commercial banks.
• Reverse Repo rate is rate at which RBI borrows from commercial banks. This works opposite to Repo rate.
RBI takes up Reverse repo operations to remove excess liquidity with banks by selling securities with
agreement that it will buy securities at later date. Generally, Reverse Repo rate is lower than Repo Rate.
• Reverse repo transaction is opposite of repo transaction. Here, commercial banks deposits money with RBI
while getting interest rate called reverse repo rate.
• Reverse Repo rate is rate at which RBI borrows from commercial banks. It is part of Liquidity Adjustment
Facility (LAF) of RBI. Reverse Repo rate borrowing is generally available at 7 day, 14 day reverse repo rate.
RBI makes repurchase agreement with commercial banks and sells securities and buy them back at different
rate on agreed price. Increased reverse repo rate will encourage banks to lend to RBI. This will reduce
liquidity with bank resulting in decreased lending activities and reduced demand in market. It is part of
contractionary monetary policy. On other hand, decreased reverse repo rate will encourage banks to lend
to customers rather than lending to RBI, therefore increasing liquidity and demand in market. This is part of
Expansionary Monetary Policy.
 Objective:
• Main objective is to absorb excess liquidity available with banks and slow down inflation process.
• Regulation of money supply and absorption of excess money supply for short periods of time.
 Feature:
• Reverse Repo Rate is linked with Repo, and hence Reverse Repo Rate cannot be increased /
decreased independently. Usually, Reverse Repo Rate = Repo Rate – 1%.
 Significance:
• Though Reverse Repo Rate does not have much significance compared to repo rate (which impacts economy
directly), reverse repo rate impacts on different sectors indirectly.
• Term liquidity in banking system refers to daily idle cash that banks may have. Banks may not have any idle
cash at times, and liquidity in banking system may be tight. In such case, banks will borrow from one another
or from RBI. When banking system has excess idle cash, reverse repo rate becomes more important because
all banks lend to RBI. At such times, yield curve begins with reverse repo. Yield curve plots bond yields or
interest rates (of equal credit quality) against maturity dates and its slope can provide insight into interest
rate changes.
 Variable Rate Reverse Repo (VRRR) auction:
• VRRR is sub-type of reverse repo rate. Reverse repo rate is interest rate that RBI pays to banks for funds..
• usually undertaken to reduce money flow by sucking out cash from financial system
• Since 2021, RBI has been absorbing money from banking system via VRRR auctions.

{Repo Rate} {Reverse Repo Rate}
{Meaning} Rate at which RBI lends money to Rate at which RBI borrows money
banks. from banks.
{Rate of borrowing} Higher than reverse repo rate Lower than repo rate
{Purpose} To control inflation and deficiency of To manage cash-flow.
funds.
{Procedure} Sale of securities which would be Transfer of money from one account
repurchased in future. to another.
 Bank Rate:
→ What:
 Bank Rate is interest rate at which country's central bank lends money to domestic / commercial banks.
 In India, Bank Rate is interest rate at which RBI lends money in long term to domestic / commercial banks.
→ Feature:
 Commercial banks are not required to keep any collateral as security when borrowing at Bank Rate.
 There is no repurchasing agreement and no obligation to repay on particular date.
 Reserve Bank of India Act, 1934 governs publication of Bank Rate.
 Bank rate is linked to MSF rate, and therefore Bank Rate adjusts automatically when MSF rate changes, as well
as when policy repo rate changes.
 Bank rate is not main tool to control money supply.
→ Determination of Bank Rate:
 RBI is authority in India to determine Bank Rate. RBI in its bi-monthly monetary policy review announces bank
rate based on macroeconomic situation. Bank Rate is announced keeping in mind primary goal of inflation
targeting. If Bank rate is decreased then it increases money supply in economy as banks borrow and lend it to
customers. On other hand, if Bank rate is increased it will inhibit money supply in economy.
→ Usage:

Page 669 of 719

  Penal rates are linked with Bank rate. For example, If bank does not maintain CRR, SLR as per prescribed limit.
Then RBI can impose penalty interest on such notorious bank which is Penalty rate = Bank rate + X%.
 RBI does not use Bank rate much, to control money supply. But Bank rate can still be used to fight inflation or
deflation. To fight inflation, RBI should increase bank rate (so that it becomes harder or more expensive for
banks to borrow from RBI). To fight deflation, RBI should decrease Bank rate.

{Bank Rate} {Repo Rate}
{Meaning} Bank Rate is applied to loans made by Repo Rate is applied to central bank's
central bank to commercial banks. repurchase of securities sold by
commercial banks.
{Collateral} No collateral is required. Securities, bonds, agreements are
given as collateral.
{Impact} Directly impact customers as it Repo rate is handled by banks and
impacts long term lending. does not impact customers directly.
{Rate} Higher than Repo due to no collateral Lower than Bank Rate as there is
and long term nature. collateral and repurchase obligation.
{Loan duration} Bank rate caters to long term Repo Rate focuses on short term
requirements of commercial banks. financial lending.
 Accommodative policy stance / Easy monetary policy / Loose monetary policy / Loose credit monetary policy:
→ It occurs when central bank attempts to expand overall money supply to boost economy when growth is
slowing (as measured by GDP). This policy is implemented to allow money supply to rise in line with
national income and demand for money. It allows fiscal reserve to increase in relation to national income
and positive function of money demand. This pol icy generally includes lowering of interest rates.
→ It is strategy used by central banks to keep interest rates low in order to infuse more cash into economy
so as to boost growth, maintain / reduce unemployment.
→ It means central bank is prepared to expand money supply to boost economic growth.
→ Central bank, during accommodative policy period, is willing to cut interes t rates.
 Standing Facility:
→ Marginal Standing Facility (MSF):
 What:
• MSF refers to rate at which banks can borrow overnight funds from RBI in exchange for authorized
government securities. This is applicable in emergency situations such as inter-bank liquidity dries
up completely and results in volatility in overnight inter-bank rate (Under interbank lending, banks
lend funds to one another for specified term.).
 Objective:
• To reduce volatility of overnight inter-bank interest rates.
• To aid banks in case of emergencies like drying up of inter -bank liquidity.
 Purpose:
• MSF facility is specially created to help scheduled commercial banks to solve their short-term cash mis-
match. In repo borrowing, banks need to pledge securities to RBI. But banks cannot use SLR -
reserved securities under repo transaction. So, in situation where bank is in dire need of cash, but
does not have spare government securities, they can borrow using MSF by pledging those SLR
securities. And under MSF window, RBI will demand 1% higher than Repo usually as one type of
punishment for pledging SLR securities.
 Feature:
• Banks have to exchange securities with RBI to avai l of overnight credit through MSF.
• Maximum credit bank can avail through MSF is says 3% of its total deposits (NDTL).
• Banks can use securities under SLR quota without paying penalty because it is emergency situation.
This will shield banks from volatility of overnight inter-bank interest rates.
• Generally, MSF is higher than repo rate.
• MSF is linked with Repo, and hence MSF cannot be increased / decreased independently. Usually, MSF =
Repo Rate + 1%.
• MSF is temporary solution.
 Significance:
• MSF is emergency measure to lend to banks who are short of liquidity for day-to-day operations for short
while. MSF charges premium beyond repo rate giving relaxation on SLR quota securities in providing short-
term liquidity and reducing volatility in overnight inter-bank interest rates.
 Fact:
• Difference between MSF and Reverse repo rate is called spread of lending and borrowing rate by
RBI.
→ Standing deposit facility (SDF):

Page 670 of 719

  What:
• RBI’s new tool to absorb excess liquidity to control inflation.
• RBI’s additional tool for absorbing liquidity without any collateral.
 Purpose:
• SDF’s main purpose is to reduce excess liquidity in system, and control inflation.
 Feature:
• RBI is empowered to introduce SDF.
• SDF rate is applicable to overnight deposits.
• SDF will replace fixed rate reverse repo (FRRR) as floor of Liquidity Adjustment Facility (LAF) corridor.
• Both standing facilities —MSF and SDF will be available on all days of week, throughout year.
 SDF operation:
• SDF rate will be 25 bps below policy rate (Repo rate), and it will be applicable to overnight deposits. It would,
however, retain flexibility to absorb liquidity of longer tenors as and when need arises, with appropriate
pricing. RBI’s plan is to restore size of liquidity surplus in system to level consistent with revailing stance of
monetary policy.
 What happens to Reverse repo rate?
• Fixed rate reverse repo (FRRR) rate will remain part of RBI’s toolkit, and its operation will be at discretion of
RBI. FRRR along with SDF will impart flexibility to RBI’s liquidity management framework.
 Significance:
• By removing binding collateral constraint on RBI, SDF strengthens operating framework of monetary policy.
SDF is also financial stability tool in addition to its role in liquidity management.
• SDF, along with FRRR, will impart flexibility to RBI’s liquidity management framework.
 Liquidity in year 2022:
• “Extraordinary” liquidity measures undertaken in wake of Covid pandemic, combined with liquidity injected
through various other operations of RBI, have left liquidity overhang of about Rs. 8.5 lakh crore in system.
This pushed up retail inflation level in system. Thus RBI Governor said in 2022 that RBI would engage in
gradual and calibrated withdrawal of this liquidity over multi-year time frame in non-disruptive manner
beginning from 2022.

{LAF} {MSF}
RBI sets higher minimum amount to be borrowed by RBI sets lower minimum amount to be borrowed by banks
banks from it. from it.
All RBI’s clients can use it: Central government, State Only scheduled commercial banks (SBI, PNB, BoB, ICICI,
governments, Banks (All commercial bank, RRB, etc) can borrow under this window.
cooperative bank), NBFI.
Banks cannot pledge securities from SLR quota to borrow Can use securities from SLR quota.
from this window.
There is no limit on borrowing amount (as long as There is limit beyond which scheduled commercial banks
government securities are given to RBI.) cannot borrow money from RBI. This maximum limit is
calculated on NTDL of that bank. For example, RBI can set
like maximum amount that can be borrowed under MSF
= 3% of NDTL.

{Repo} {MSF}
Repo rate is applied to loans made to banks in order to MSF is intended for overnight lending to banks.
meet their short-term financial requirements.
Repo rate is rate at which RBI lends money to commercial MSF rate is rate at which RBI lends money to scheduled
banks banks.
Lending at repo rates entails selling bank securities as Loans at MSF rates require provision of government
collateral to RBI and entering into repurchase agreement. securities as collateral.
 Open Market Operation (OMO):
→ What:
 In macroeconomics, OMO is activity by central bank to give (or take) liquidity in its currency to (or from) bank or
group of banks. Central bank can either buy or sell government bonds (or other financial assets) in open market
(this is where OMO name was historically derived from) [term open market is used generally to refer to economic
situation close to free trade. In more specific, technical sense, term open market refers to interbank trade in
securities] or, in what is now mostly preferred solution, enter into repo or secured lending transaction with
commercial bank: central bank gives money as deposit for defined period and synchronously takes eligible asset
as collateral.
 market operation in which RBI / central bank sell or purchase G-Secs to control money supply - bonds, T-Bills- to
or from market respectively.

Page 671 of 719

  one quantitative monetary policy tool
 OMO is selling and purchase of government securities and T-Bills by RBI.
→ Objective:
 regulate money supply in economy i.e. to adjust rupee liquidity in market
 To change liquidity in economy.
 To manipulate short term interest rates.
→ Feature:
 Commercial banks and financial institutions participate in OMO.
 OMO do not create any new Government Securities (G-Sec) rather it alters RBI’s holding of G-Sec.
 Selling of G-Secs by RBI will reduce liquidity in market and buying of G-Secs by RBI will increase liquidity.
 All Scheduled Commercial Banks and Financial institutions can participate in OMO.
 RBI allows even retail investors to invest in G-secs by opening gilt accounts with Central Bank.
→ How:
 RBI carries out OMO through commercial banks and does not directly deal with public:
• In excess of liquidity in market, RBI sales securities in market and thereby sucking out rupee liquidity from
market.
• In tight liquidity conditions, RBI buys securities from market and thereby releasing liquidity into market.
→ Types:
 Outright Purchase (PEMO):
• This is outright buying and selling of government securities. This is permanent in nature without any
obligations.
 Repurchase Agreement (REPO):
• This is short term buying and selling of G-secs subject to repurchase agreement on particular timeline.
→ Usage:
 To fight inflation, RBI sells securities in OMO. [Same explanation as CRR, SLR as mentioned above]
 To fight deflation, RBI buys securities in OMO. [Same explanation as CRR, SLR as mentioned above]
→ Significance:
 RBI performs OMO based on macroeconomic scenario in Indian economy. Primary objective will be to
manipulate readily available liquidity in economy which in turn have cascading effects on inflation, bond yields
etc.
 RBI indirectly:
• controls money supply
• influences short-term interest rates
• reduces inflation by selling g-secs.
→ Fact:
 In 2021, RBI performed simultaneous buying and selling of Government securities through OMO of nearly Rs.
10000 crores each. (Operation twist).
 Market Stabilization Scheme / Market Stabilisation Scheme (MSS):
→ What:
 One monetary policy intervention by RBI to withdraw excess liquidity (or money supply) by selling government
securities in economy.
 One RBI monetary policy tool for managing economy's money supply.
→ Origin:
 MSS was introduced in 2004 to withdraw huge liquidity in economy as result of RBI buying large amounts of
foreign currencies and potentially leading to inflation. Government Bonds are sold to financial institutions, and
money is returned to RBI. This process of removing surplus liquidity is called sterilisation.
→ Example:
 MSS was used to withdraw excess liquidity created during demonetisation in 2016. During demonetisation,
MSBs worth Rs. 6 lakh crores were issued by RBI to withdraw excess liquidity.
→ Feature:
 Securities issued are government bonds known as Market Stabilisation Bonds (MSB). As result, MSBs are bonds
issued under MSS. Government owns these securities, despite fact that they were issued by RBI. Government
securities (bonds / T-Bills) are often sold or issued by RBI (government's banker). Government lends RBI its bonds
or securities (MSBs) to carry out MSS. RBI thus becomes debtor to government in amount of MSBs. However,
government cannot use money raised during MSS and must be kept in separate MSS account to pay for bonds
at maturity. Interest is paid for MSB’s by government.
→ MSS and Demonetization:
 Following demonetisation, massive deposits were made into banking system. Banks, on other hand, are unable
to lend it to customers because it is only temporary money. RBI had directed banks to keep all additional deposits
in CRR status. However, banks will incur losses because they must pay interest to depositors. Thus, MSS policy

Page 672 of 719

 had been reinstated to compensate banks. Banks can invest excess funds from deposits in MSBs here. They may
also be eligible for interest payments.
→ Significance:
 Goal of implementing MSS was to sterilise extra long-term liquidity absorption from day-to-day typical liquidity
management operations. This is used only in grave scenarios where excess liquidity would cause inflation and
change other macroeconomic parameters.

{MSS} {OMO}
{Procedure} Involves only selling of securities and Involves both buying and selling of
bonds. government securities.
{Aim} To withdraw excess liquidity. Used for both injecting and
withdrawing liquidity.
{Usage} Only in necessary scenarios Regular activity.
{Tenure} Usually less than 6 months Varies from short to long term.
 Long Term Repo Operation (LTRO):
→ What:
 RBI uses this tool to ensure liquidity in system
 central bank provides 1-year to 3-year money to scheduled commerical banks at prevailing repo rate, accepting
government securities as collateral.
 to prevent short-term interest rates in market from drifting away from policy rate (repo rate)
→ LTRO vs LAF vs MSF:
 LAF and MSF offer money to banks for their immediate needs ranging from 1-28 days
 LTRO supplies them with liquidity for their 1- to 3-year needs.
→ Significance:
 Banks get long-term funds at lower rates, thus their cost of funds falls.
 In turn, they reduce interest rates for borrowers.
 RBI through LTRO ensures that banks reduce their marginal cost of funds-based lending rate without reducing
policy rates.
 LTRO is another way that RBI rely on - apart from revising repo rates, conducting OMO - for its monetary policy.
 Government Security Acquisition Programme (G-SAP):
→ What:
 unconditional and structured Open Market Operation (OMO), of much larger scale and size.
 RBI calls G-SAP as - OMO with distinct character.
 Here ‘unconditional’ means - RBI has committed in advance that it will buy G-Secs irrespective of market
sentiment.
→ Objective:
 To achieve stable and orderly evolution of yield curve
 management of liquidity in economy.
→ Calculation:
 RBI liquidity required to balance G-Sec market (RBI OMO + G-SAP) = Govt. borrowing (centre + States) – Total
demand (Bank demand + others)
→ Significance:
 comfort to bond market.
 As borrowing of Government increases, RBI has to ensure there is no disruption in Indian market.
 reduce spread between repo rate and 10-year government bond yield.
 G-SAP will almost serve purpose of OMO calendar, which had been on bond market’s wish list for long time.
 Usually, Reverse Repo Rate ( = Repo Rate – 1%) < Repo Rate < MSF Rate ( = Repo Rate + 1%) < Bank Rate. [1% = 100 Basis
Points].
 Federal Reserve [1913]:
→ What:
 Federal Reserve is central bank of USA. It formulates and administers credit and monetary policy.
 Federal Reserve System / Federal Reserve / Fed is central banking system of USA.
→ Fed interest rate:
 When Fed raises its policy rate / interest rate:
• Impact:
 Increase in interest rate will make US bonds more attractive and investors / citizens will invest in them
rather than spend. Also, borrowings will become costly, this will rein in inflation. Also, FII from emerging
markets may take out their money and invest in US bonds. This will strengthen US currency against
others.
• Impact on India:

Page 673 of 719

  When Fed raises its policy rates, difference between interest rates of USA and India narrows, thus,
making India less attractive for currency carry trade.
 Higher returns in US debt markets may lead to flight of foreign investors from India into USA.
 It could weaken Indian currency in relation to US Dollars.
 Impossible trinity / Impossible trilemma / Unholy Trinity:
→ What:
 Impossible trinity is one concept in international economics which states that it is impossible to have all 3 of
following at same time:
• fixed foreign exchange rate;
• free capital movement (absence of capital controls);
• independent monetary policy.
→ Origin:
 It is both hypothesis based on uncovered interest rate parity condition, and finding from empirical studies where
governments that have tried to simultaneously pursue all 3 goals have failed. This concept was developed
independently by both John Marcus Fleming in 1962 and Robert Alexander Mundell between 1960 and 1963.
→ Example:
 Historically in advanced economies, periods pre-1914 and 1970–2014 were characterized by stable foreign
exchange rates and free capital movement, whereas monetary autonomy was limited. Periods 1914–1924 and
1950–1969 had restrictions on capital movement (e.g. capital controls), but exchange rate stability and
monetary autonomy were present.
Question:
 To control inflation, RBI sells securities in money market which sucks out excess liquidity from market. As amount of liquid
cash decreases, demand goes down. This part of monetary policy is called OMO.
 If rupee is depreciating, RBI pumps US dollar into market, this results in increase in foreign currency supply and decrease
in Rupee supply, thus appreciating Rupee’s value.
 If interest rates in US, EU fall, investors would like to park more money in emerging market such as India for better
returns, thus Indian market would be flooded with foreign currency. To stabilize it, RBI would likely buy excess US dollars.
 At time of economic recession, government should (to solve recession) increase expenditure on public projects.
 If interest rate is decreased, it becomes easier to borrow money at low-interest rate and therefore individuals /
companies will increase their investment expenditure.
Value Addition:
 Operation Twist:
→ What:
 Buying long term G-Secs and selling short term G-Secs by RBI.
 RBI’s simultaneous selling of short-term securities and buying of long term securities through open market
operations (OMO). This will increase price of long term G-secs in market due to its demand and reduce its yield.
 short-term securities are transitioned into long-term securities.
→ Why:
 Monetary Transmission: RBI → interest rate (overnight rate) ↓ → Banks borrow from RBI at cheaper rates →
Due to competition among banks, banksoffer cheaper loan to customers/corporates → Attractive borrowings
from banks →consumers/corporates borrow more money from banks → consumers/corporates’ spending ↑,
investment ↑ → consumption expenditure of GDP (economic activity) ↑ → Demand ↑ → economic
growth/boost.
 Problem in above is RBI's interest rate:
• It is also known as overnight rate.
• That is, banks’ repayment to RBI must be done in less than 24 hours. That means, repayment has to be done
the next day, though banks can reborrow the next day and continue doing so.
• It means, banks need to have enough money every day to pay back to RBI.
• So, banks are ready to offer cheaper loans to customers/corporates as long as repayment periods remain
short and comfy.
• But, when banks lend loans that mature in 10, 20, 30 years, what RBI does with the overnight rates becomes
irrelevant (esp. as banks’ finances are already in bad shape like NPA etc.).
• And, since most consumer loans have long repayment periods, banks haven not been cutting interest rates
here.
• So despite repeated rate cuts by the RBI, things haven’t improved on this front.
 RBI’s Remedy to above problem – “long term deposits/funding to banks”:
• Customers/corporates lend money to banks say long term fixed deposit (FD) e.g. 10 year FD.
• Here, banks repay to customers/corporates only when the long term tenure is over.
• Therefore, banks would be willing to cut rates on loans to customers/corporates if customers/corporates
lend banks long term FDs at cheaper rates as well.
• That means, RBI has to tweak FD rates, so that banks would be more willing to cut rates on consumer loans.

Page 674 of 719

  Now comes, Operation Twist:
• Objective:
 RBI has to influence “deposit rates or other sources of long term funding to banks”.
 One way RBI does this is by influencing the yield on long term Government Securities say 10-year G-
Sec’s.
• How RBI influences G-Sec’s yield?
 RBI buys a truckload of 10-year G-Sec’s (say worth about Rs. 10,000 crores) from Government.
 So, very little need for the government to borrow from anyone else (investors/financial market).
 So, investors still looking to invest in G-Secs will get lower yield from Government.
• How RBI influence Deposit Rates?
 Due to lower yield in G-Secs, some investors eventually turn elsewhere say 10 year FD in banks.
 As more money flow into FDs, banks won’t have to lure customers by offering higher returns.
 So, banks cut FD rates gradually.
 This low cost funding to banks is trickled down to customers by giving cheaper loans to them.
• Another problem – Inflation: How RBI manages it?
 To buy G-Secs, RBI had to print a lot of money.
 Those money will eventually enter the financial ecosystem (financial market).
 So, there is real risk of stoking inflation.
 Thus, to mop up this extra money, RBI is simultaneously selling Rs. 10,000 crores worth of short term
G-Secs that are maturing next year.
→ Benefits:
 Consumers/borrowers will also profit from ‘Operation Twist’ as the retail loans will now get cheaper.
 Cheaper retail loans mean a boost in consumption and spending in the economy which in turn will revive growth.
→ Conclusion:
 Theoretically, the yields on the 10 years G-Secs will fall and the yields on the short term G-Secs will rise.
 In effect, twisting the equilibrium that once prevailed. Hence the name – Operation Twist.
Question:
 Bank rate, OMO are instruments of monetary policy. Public debt and public revenue are part of fiscal policy.
 If RBI decides to adopt an expansionist monetary policy, then among other steps it could cut and optimize the Statutory
Liquidity Ratio, decrease the Marginal Standing Facility Rate, cut the Bank Rate and Repo Rate.
Mains Link:
 Why are countries increasing their interest rates? What are the ways in which the RBI has tried to cushion the
fall of the rupee? (200 Words, 10 Marks)

INFORMATION TECHNOLOGY (IT)

News:
 2021:
→ Under Information Technology (IT) Act 2000, Ministry of Electronics & Information Technology (Meity) notified
‘Information Technology (Guidelines for Intermediary and Digital Media Ethics Code) Rules, 2021’for both:
 digital (online) media
 OTT platforms.
→ Petition in Delhi High Court claiming new IT rules 2021 seeks to regulate online news portals by imposing government
oversight and vaguely worded ‘Code of Ethics’.
→ WhatsApp moves Delhi High Court against India’s new and stricter IT Rules 2021 that require instant messaging
platforms to aid in identifying originator of messages.
→ Twitter loses its intermediary status in India over non-compliance of new 2021 IT rules.
→ Centre told Delhi High Court that Twitter Inc. has failed to comply with India’s new IT Rules, which is law of land.
→ Supreme Court issued notice to Centre on use of Section 66A of IT Act, 2000 that was scrapped in 2015 and said that
it is shocking that judgment that struck down Section 66A of IT Act, 2000 has not been implemented even now.
→ Ministry of Home Affairs (MHA) asked States, UTs to immediately withdraw cases registered under repealed-Section
66A of Information Technology Act, 2000.
→ Under Information Technology (IT) Act, 2000, govt. notified Information Technology (Guidelines for Intermediary and
Digital Media Ethics Code) Rules, 2021 for both digital (online) media and OTT platforms.
→ Union’s reply to Supreme Court:
 Ministry of Information and Technology, Ministry of Home Affairs had done their best to spread knowledge
about Supreme Court Shreya Singhal judgment 2015 on Section 66A, IT Act, 2000. Despite this, many cases have
been registered under section 66A.
 Since police and public order are State subjects under Constitution, onus lies with States to implement apex
court’s judgment quashing draconian section 66A.
 Law enforcement agencies share equal responsibility to comply with apex court judgment.

Page 675 of 719

 → Twitter appoints permanent: Chief Compliance Officer (CCO); Resident Grievance Officer (RGO); Nodal Contact
Person in compliance with new Information Technology (IT) Rules 2021.
→ Supreme Court also commented about lack of adequate accountability to hold social media and over the top (OTT)
content platforms for their actions. [To which govt. highlighted - Information Technology Rules, 2021, Cable
Television Networks (Amendment) Rules, 2021.]
 2022:
→ Ministry of Electronics and Information Technology (MeitY) bans 54 more apps which have either originated
in China or have some Chinese connection, on ground for being threat to national security under Section 69
of Information Technology Act, 2000. [In total so far, about 300 apps and their proxies are banned by IT
ministry.]
 Reason:
• misuse of mobile apps available on Android and iOS platforms for stealing and secretly transmitting users’
data in unauthorized manner to servers located outside India.
• hostile to national security and defence of India, hurting sovereignty and integrity of India
• prejudicial to sovereignty and integrity of India, defence of India, security of state and public order.
 Implication:
• Blocking of Chinese mobile applications suggests that Indian government wants to make it clear that it will
not shy away from leveraging its position as massive market for technology in dealing with potentially
dangerous geopolitical issues.
 China’s response:
• China says India’s bans could be in violation of WTO rules.
• Chinese Government says India’s measure selectively and discriminatorily aims at certain Chinese apps on
ambiguous grounds, runs against fair and transparent procedure, abuses national security exceptions, and
is suspected of violating WTO rules.
→ Information & Broadcasting (I&B) Ministry approaches Directorate of Information and Public Relations
(DIPR) of all State, UT governments to initiate awareness drive for sensitising th eir officials to code of ethics
and procedure, and safeguards in relation to digital media.
→ Using emergency powers under IT Rules, 2021, Ministry of Information and Broadcasting blocks 16 YouTube
news channels, including some from Pakistan.
 Reason: Charges of spreading false and unverified information to create panic, incite communal disharmony and
disturb public order in India.
→ Towards overhauling 2-decade old IT Act, 2000, Centre says it will put up draft of proposed new legislative
framework for public consultation soon. [Centre is looking at new legislative framework with new
rulemaking capabilities that deal with various issues related to digital space, in very modern, contemporary
and harmonized way].
→ Supreme Court restrains High Courts from proceeding with petitions related to Information Technology
(Guidelines for Intermediary and Digital Media Ethics Code) Rules, 2021 and Cable Television Networks
(Amendment) Rules, 2021. [Many digital media publishers like Live Law, and bodies like Indian Broadcasti ng
and Digital Foundation (IBDF) have challenged 2021 IT Rules].
→ MeitY publishes fresh draft of amendments to Information Technology Rules, 2021.
 2022 Amendments:
• Appeal committees:
 Government-appointed appeal committees will be created that will be able to veto content-moderation
decisions taken by social media intermediaries like Facebook, Twitter, YouTube.
 These Appellate Committees shall consist of Chairperson and such other Members, as Central
Government may, by notification in Official Gazette, appoint.
• Additional responsibilities will be placed on grievance officers appointed by social media companies.
Grievance officers will now have to expeditiously dispose complaints within 72 hours (Earlier, it was 15
days).
 Benefit for user: In case user is not satisfied with content moderation decision taken by company’s grievance
officer, they he can appeal that decision before this proposed government-appointed appeals committee.
 Need: So far, only recourse user had against companies’ content decisions was to approach courts. Also, there
have been many instances that grievance officers of intermediaries either do not address grievances
satisfactorily and / or fairly. This 2022 amendments will ensure that Constitutional rights of Indian citizens are
not contravened by any big tech platform by ensuring new accountability standards.
 Concerns: This 2022 proposal to set up government-appointed committees has triggered concerns about
government overriding social media platforms’ content decisions.
→ Twitter initiates legal action against some of government missives ordering it (under section 69A IT Act, 2000) to take
down certain content.
 Ground:

Page 676 of 719

 • Twitter claims that many of Govt.’s blocking orders are procedurally and substantively deficient under
Section 69A of IT Act: Eg., Not giving prior notice to users before taking down content posted by them; MeitY
has failed to demonstrate how some of content it wants taken down falls under purview of Section 69A;
Some of content flagged by ministry may pertain to official accounts of political parties, blocking which could
be violative of right to free speech.
→ Supreme Court orders States and their police forces to stop prosecuting free speech on social media under Section
66A IT Act which was declared unconstitutional by it in a judgment 7 years ago. Supreme Court found it both
“distressing” and “terrible” that the police had continued to pick out people and prosecute them under the draconian
Section regardless of the fact that the Apex court had struck down the law as “vague” and “chilling”.
→ CCI imposes a penalty of Rs. 1,337.76 crore on Google for abusing its dominant position in multiple markets in the
Android mobile device ecosystem. Besides, the fair trade regulator has directed the internet major to cease and
desist from unfair business practices.
→ Minister of State for Electronics Rajeev Chandrasekhar stresses that with the new amendments (2022) to the
Information Technology rules - The Information Technology (Intermediary Guidelines and Digital Media Ethics Code)
Rules, 2021, GOI’s focus is to make the Internet a safe, trusted and accountable space for users, and to ensure that
platforms such as Twitter and Facebook respect the rights accorded to the citizens of India under the Articles 14, 19
and 21. He also dismisses criticism that the setting up of Centre-appointed Grievance Appellate Committees (GACs)
would give GOI power to moderate content on social media, saying that content moderation is not an issue that is
going to come to GACs at all.
About:
 Big Tech / Tech Giants:
→ What:
 It is a grouping of the most dominant companies in the IT industry, mostly centered in USA. The term also can
refer to the 4 or 5 largest American tech companies, sometimes referred to as the Big Four or Big Five, which
presently consist of Alphabet (Google), Amazon, Apple, and Meta (Facebook) —with Microsoft completing the
Big Five.
→ How GOI is trying to control Big Tech?
 Under India’s data protection bill, big tech companies are mandated to store copy of certain sensitive personal
data within India and export of undefined critical personal data from India is prohibited. As of now, most of
these data are stored, in cloud, outside India. In 2018, Srikrishna Committee report on data protection [2017]
said at least one copy of personal data must be stored on servers located within India. Srikrishna Committee
wants to localise data for law enforcement to have easy access to data, prevent foreign surveillance, and build
AI ecosystem in India. As per this committee – At least one copy of personal data will need to be stored within
India, any transfer outside India will need to comply with rules, and critical personal data will only be stored and
processed in India. Draft National e-Commerce Policy Framework [2019] recommends data localisation and
suggested 2-year sunset period for industry to adjust before localization rules become mandatory.
 In India, IT Rules place significant due diligence requirements on large platforms like Facebook, Twitter.
 Indian Telecommunication Bill, 2022 proposes to bring OTT communication platforms under its ambit, subjecting
them to rules similar to those governing telecom operators, including licencing.
 Putting caps on market shares of payment platforms.
 Digital Personal Data Protection Bill, 2022 proposes data localisation norms which are guided by the desire to
exercise greater control over cross-border data flows. [Though increasing data storage requirements and
imposing strict restrictions would also increase the compliance burden of Big Tech].
 One function of Open Network for Digital Commerce (ONDC) [2021] [a private non-profit company established
by Department for Promotion of Industry and Internal Trade (DPIIT) of Ministry of Commerce and Industry to
develop open e-commerce] is to keep check on Big Tech companies from violating Consumer Protection (E-
Commerce) (Amendment) Rules, 2021 due to concentration of market power by integrating them into open-
source decentralized network where data portability will break data silos while data interoperability will allow
innovation. ONDC will allow small merchants and mom-and-pop stores in India to access consumers (similar to
those done by Amazon, Flipkart).
→ Concern regarding GOI regulations:
 Govt. regulations could well lead to an era of inefficient, uncompetitive goods and services.
 It goes against the government stated desire to build and nurture a vibrant digital economy.
 Continuing with this approach would be a mistake esp. given India needs investment.
 It will hurt consumers at last as services may be restricted by Big Tech, following government regulations.
 Increasing data storage requirements and imposing strict restrictions would also increase the compliance burden
of Big Tech.
→ Way Forward:
 Imposition of Govt. regulations, via bills say, should not seek to tilt the balance of power rather should seek to
create a level playing field.
 Information Technology Act, 2000 / IT Act, 2000:
→ What:
Page 677 of 719
  primary law in India dealing with cybercrime, electronic commerce.
→ Why:
 Enacted to give legal sanction to electronic commerce, electronic transactions, so as to enable e-governance,
and also to prevent cybercrime.
→ Provision:
 For any crime involving computer or network located in India, foreign nationals can also be charged.
 This law prescribes penalties for various cybercrimes and frauds through digital / electronic format.
 It also gives legal recognition to digital signatures.
 Section 69A (Power to issue directions for blocking for public access of any information through any computer
resource):
• Where Central Government or any of its officers specially authorised by it is satisfied that it is necessary, in
interest of sovereignty and integrity of India, defence of India, security of state, friendly relations with
foreign states or public order or for preventing incitement to any cognizable offence relating to above, for
reasons to be recorded in writing, by order, direct any agency of Government or intermediary to block for
access by public or cause to be blocked for access by public any information generated, transmitted,
received, stored or hosted in any computer resource.
• …
 Intermediary status:
• IT Act, 2000 defines intermediary as person / entity that:
 receives
 stores
 transmits information or provides service for transmission of information.
• Example:
 telecom service providers, network service providers, internet service providers, search engines, online
payment sites, online-auction sites, online-marketplaces, cyber cafes.
• [intermediary status is not registration granted by government].
• Benefit:
 Safe harbour protection:
o IT Act, 2000, says Intermediaries (like Twitter) cannot be held liable for 3rd party content published
on their platforms as long as they comply with legal order, from courts or other authorities, to take
down that content.
o Arguments:
✓
{for safe harbour} {against safe harbour}
Platforms like Twitter, Facebook argue that Platforms can use ranking algorithms to
they have millions of users and that they determine what gets seen on their
cannot possibly be aware of each and every platforms.
post, just as managing director of Amazon
does not always know all items being sold.
Removing safe harbour protections would
mean that platforms have to actively police
and sensor all contents, which in turn could
violate free speech and other fundamental
rights.
• Authority that decides intermediary status:
 Courts, not government, will decide whether Intermediary (like Twitter) can lose Intermediary status
or not under law.
→ Its secondary / subordinate legislation:
 Intermediary Guidelines Rules, 2011.
 Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
→ Flaws:
 Privacy issues:
• IT Act, 2000 doesn’t address privacy issues – privacy is now fundamental right and this law needs to
specifically address privacy concerns.
 Poor protection of cybersecurity:
• This IT Act is not cybersecurity law and therefore does not deal with nuances of cybersecurity.
 Lack of expertise:
• Regular police personnel, specifically any officer holding rank of inspector, are responsible for investigating
criminal online activities.
 Section 66A of IT Act, 2000 [though it was struck down in 2015 Shreya Singhal by Supreme court].
→ Way Forward:

Page 678 of 719

  Indian IT Act, 2000 needs to be amended to deal with cybersecurity.
 This Act needs to be future-proofed so as to cover emerging technologies and challenges it brings in its wake.
 Eliminate safe-harbor provisions that exempt intermediaries from liability.
 Empower CERT and enforce stricter and substantial penalties on defaulters.
 Address privacy issues in this Act.
 Learn from data breach laws of other countries.
 More collaboration with private players and cybersecurity experts.
 Amend this Act to introduce Online Dispute Resolution (ODR).
 Similar to RBI’s mandate for bank to report breach within 6 hours, CERT needs to come up with same guidelines
for other institutions to enforce cyber vigilance.
 Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 / IT Rules 2021:
→ What:
 Code of ethics to be followed by digital news publishers and OTT platforms.
 under Information Technology (IT) Act 2000.
 administered by Information & Broadcasting (I&B) Ministry.
→ Need:
 To make the internet open, safe, and accountable for all digital users.
 To make intermediaries (Twitter, Facebook, etc) respect constitutional rights granted to citizens under A14, 19
& 21.
→ Features:
 Legal obligation on intermediaries to take reasonable efforts to prevent users from uploading certain categories
of harmful / unlawful content. This will ensure that the intermediary’s obligation is not a mere formality.
 For effective communication of the rules and regulations of the intermediary, it is important that the
communication is done in regional Indian languages as well.
 Whether any content is defamatory or libellous will be determined through judicial review.
 It has content categories to deal particularly with misinformation, and content that could incite violence
between different religious/caste groups.
 Intermediaries should respect the rights guaranteed to users under Indian Constitution, including a reasonable
expectation of due diligence, privacy and transparency.
 Grievance Appellate Committee (s) will be established to allow users to appeal against the inaction of, or
decisions taken by intermediaries on user complaints. However, users will always have the right to approach
courts for any remedy.
 IT Rules, 2021, introduces 2 distinct sets of regulations:
• norms to be followed by ‘intermediaries’
• ‘Code of Ethics’ to be adhered to by ‘publishers’, along with 3-tier compliance mechanism.
 Grievance redressal system for over the top (OTT) and digital portals in India. [This is reqd. for users of social
media to raise their grievances against misuse of social media.] It includes:
• self-regulation by publishers at 1st level
• self-regulation by self-regulating bodies of publishers
• oversight mechanism by Central government.
 Chief compliance officer:
• Significant Social Media Intermediary (SSMI) [at least50 lakh registered users] have to appoint chief
compliance officer.
 Nodal officer:
• SSMI have to appoint nodal contact person who can be in touch with law enforcement agencies 24/7.
 Grievance officer:
• Social media platforms have to name grievance officer who shall register grievances within 24 hours.
 Removal of content:
• If there are complaints against dignity of users, particularly women –exposed private parts, nudity, sexual
act, impersonation etc – social media platforms must remove those within 24 hours after complaint is being
made.
 Monthly report:
• Social media platforms have to publish monthly report about complaints received, status of redressal.
 Regulation for news publishers:
• self-regulation
• self-regulatory body [headed by retired judge or eminent person]
• oversight from Ministry of Information and Broadcasting.
 Action on non-compliance:
• Social media giants / Significant Social Media Intermediary [SSMI ] (Facebook, Twitter, Instagram, WhatsApp
etc.) can face ban.

Page 679 of 719

 • Social media giant may lose its intermediary status (immunity from liabilities over any 3rd-party data hosted
by it).
• Social media giants may become liable for criminal action.
 Applicability of safe harbour provisions of IT Act 2000:
• Safe harbour provisions of IT Act 2000 granted to social media intermediaries will not be applicable if social
media intermediaries do not follow due procedure / rules and thus becoming liable for content being shared
on their platform.
 1st originator of information (originator traceability):
• Social media intermediaries / publishers, upon being asked either by court or by government authority, are
required to disclose 1st originator of mischievous tweet or message.
• Platform are liable to disclose originator of message only for purposes of:
 prevention of crime
 detection of crime
 investigation of crime
 prosecution or punishment of offence
 sovereignty and integrity of india
 security of state
 friendly relations with foreign states
 public order
 Fair opportunity to users:
• Social media companies shall give users chance for explanation and opportunity to be heard before
removing access to their accounts.
 Code of Ethics:
• IT Rules 2021 lays separate ‘Code of Ethics’ for:
 publishers of news and current affairs content
 publishers of online professional / expert content.
 Emergency powers:
• Ministry of Information and Broadcasting may give orders to block access.
→ Concerns:
 Critics say / critisizes:
• Some argue that Grievance Appellate Committees (GAC) will give GOI greater powers in content
moderation.
• social media intermediaries cannot be given power to decide as to which information is liable to be taken
down.
• that new IT Rules 2021 will harm digital news media and their rights.
• that new IT Rules 2021 violates Article 19 - freedom of speech and expression.
• that new IT Rules 2021 deprives intermediaries of their “safe-harbour protections” of IT Act 2000.
• imposition of criminal liability upon employees for non-compliance by intermediaries.
• Originator traceability could make entire citizens susceptible to cyberattacks by hostile actors.
• risking privacy of users in India
• No appellate procedure has been provided against decision of Grievance Officer and / or Chief Compliance
Officer.
• security risks
• technical complexities in implementation
 Whatsapp’s arguments [in aforementioned 2021 complaint petition in Delhi High Court]:
•
Article 21:
a. IT Rules 2021 undermines people’s fundamental right to privacy, guaranteed under Article 21.
Supreme Court’s Puttaswamy judgment:
a. In said landmark judgment, SC had held that right to privacy is fundamental right guaranteed
under Constitution.
Right to anonymity:
a. Recently, Supreme Court affirms that right to privacy includes right to anonymity.
End-to-end encryption:
a. Enabling identification of 1st originator of information in India results in significant harm,
including breaking of end-to-end encryption.
Article 19:
a. Privacy is inextricably intertwined with right to freedom of speech and expression because
privacy protects people from retaliation for expressing unpopular, but lawful, views.
→ Significance:
 Social media companies and related companies to be held accountable for “misuse and abuse”.
Page 680 of 719
 → Supreme Court:
 SC says this new regulations, IT rules 2021, of govt. to regulate OTT (over-the-top) platforms lacks teeth to punish
violators or to screen offensive content.
 SC says this new rules, IT rules 2021, are more in nature of guidelines and there is no effective mechanism for
screening or to take appropriate action against violators.
 Section 66A of IT Act, 2000 (Punishment for sending offensive messages through communication service, etc):
→ What:
 As per IT Act, 2000, any person who sends, by means of computer resource or communication device:
• any information that is grossly offensive or has threatening character; or
• any information which he knows to be false, but for purpose of causing annoyance, inconvenience, danger,
obstruction, insult, injury, criminal intimidation, enmity, hatred or ill will;
• any electronic mail or electronic mail message for purpose of causing annoyance or inconvenience or to
deceive or to mislead addressee or recipient about origin of such messages,
shall be punishable with imprisonment and with fine.
 That is, section 66A IT Act, 2000 says sending “offensive” messages through computer or any other
communication devices like mobile phone, tablet etc. is punishable offence.
→ Struck down:
 This provision was routinely used to book individuals for comments made on social media. Section 66A had been
views as “draconian” because it allowed arrest of innocent persons. This, led to public outcry for its scrapping.
 Thus, in 2015, Supreme Court struck it down as unconstitutional in Shreya Singhal Judgment.
• Reason:
 Supreme Court said that Section 66A of IT Act, 2000 arbitrarily, excessively, and disproportionately
invades right to free speech, under Constitution Article 19, and upsets balance between right to free
speech and reasonable restrictions that may be imposed on such right.
 Supreme Court also said that definition of offences under Section 66A, IT Act, 2000 was open-ended
and undefined, expressions used were vague in meaning.
 What may be offensive to one, may not be offensive to another.
 What may cause annoyance or inconvenience to one, may not cause annoyance or inconvenience to
another.
 Section 69A of IT Act, 2000:
→ It confers on Central and State governments power to issue directions to intercept, monitor or decrypt any
information generated, transmitted, received or stored in any computer resource. This section empowers Central
Government to order that access to certain websites and computer resources be blocked in interest of defense of
India, its sovereignty and integrity, security of state, friendly relations with foreign states, public order or for
preventing incitement to offence. This section allows Centre to issue blocking orders to social media intermediaries.
→ Process: Any request made by government is sent to one review committee, which then issues these directions.
Blocking orders issued under Section 69A are typically confidential in nature.
Note:
 Over-The-Top (OTT):
→ It refers to services that provide real time person-to-person telecommunication services. Some popular examples
include: Messaging platforms like Whatsapp, Telegram, Signal, Messenger, Duo, Google Meet etc.
→ OTT media service is one media service offered directly to viewers via Internet. OTT bypasses cable, broadcast, and
satellite television platforms - types of companies that traditionally act as controllers or distributors of such content.
This term is most synonymous with subscription-based video-on-demand (SVoD) services that offer access to film
and television content (including existing series acquired from other producers, as well as original content produced
specifically for that service). OTT also encompasses wave of "skinny" television services that offer access to live
streams of linear specialty channels, similar to traditional satellite or cable TV provider, but streamed over public
Internet, rather than closed, private network with proprietary equipment such as set-top boxes. OTT services are
typically accessed via websites on personal computers, as well as via apps on mobile devices (such as smartphones
and tablets), digital media players (including video game consoles), or televisions with integrated Smart TV platforms.
→ Any media service i.e online content provider that offers standalone media streaming product.
→ Example:
 Video-On-Demand (VOD) platforms
 audio / vedeo streaming
 messaging services
 internet-based voice calls etc.
→ Internet allows access to OTT service.
→ OTT services differs from traditional media channels - telecommunications networks, cable television providers.
→ According to IT Rules 2021, OTT platforms are mandated to self-classify content into below age-based categories:
 U – Universal
 U/A 7+

Page 681 of 719

  U/A 13+:
• OTT platforms are mandated to implement parental locks.
 U/A 16+:
• OTT platforms are mandated to implement parental locks.
 A (Adult):
• OTT platforms are mandated to implement parental locks.
• OTT platforms are mandated to implement reliable age verification mechanisms.
→ Significance:
 Value content
 Original content
 Low cost
 Multiple devices compatibility
 Example:
• Netflix
• Amazon prime
→ Recent Development:
 Internet and Mobile Association of India (IMAI) announced self-regulatory code.
Value Addition:
 Section 153A IPC:
→ Promoting enmity between different groups on grounds of religion, race, place of birth, residence,
language, etc., and doing acts prejudicial to maintenance of ha rmony.
 Section 505 IPC:
→ Statements conducing to public mischief.
 Doctrine of revival:
→ Doctrine of revival holds that if amendment is struck down on basis of any of below given 3 grounds, then former
un-amended law (act) revives itself (becomes active) and becomes automatically applicable. 3 grounds are:
 when lack of legislative competence causes Amendment to be struck down
 when amendment violates Fundamental Right of citizens of India, guaranteed by Constitution itself
 when amendment corrodes or works against basic essential values of Constitution.
Question:
 In India, bodies like - Ad Hoc Committees set up by Parliament; Parliamentary Department Related Standing Committees
– review Independent regulators in sectors like telecommunications, insurance, electricity, etc. In India, there are 24
Department Related Standing Committees that comprise members from both Houses of Parliament. These committees
are Ministry specific, and may review working of regulators within their respective departments. For example, in 2012,
Standing Committee on Energy presented report on functioning of ‘Central Electricity Regulatory Commission’. Ad Hoc
Committees set up by Parliament may examine working of regulators. Role of Finance Commission and NITI Aayog is
advisory in nature and they do not review independent regulators. Financial Sector Legislative Reforms Commission
(FSLRC) comprehensively reviews and redraws legislations governing India’s financial system, and it has no role in
reviewing independent regulators.
Mains Link:
 Discuss Section 66A of the IT Act, with reference to its alleged violation of Article 19 of the Constitution. (UPSC CSE 2013)

INVESTMENT
News:
 2021:
→ Finance minister launched Ubharte Sitaare Fund.
→ Centre’s Swamih Investment Fund has completed its 1st residential project.
 2022:
→ FDI in financial year 2021-22 touches “highest-ever” figure of USD 83.57 billion. Top contributors to India’s
FDI inflow: Singapore with share of 27%; US (18%); Mauritius (16%); ... Computer software and hardware
remains top sector which received FDI inflow with around 25% share followed by services sector with 12%,
and automobile sector with 12%. Karnataka is top recipient State with 38% share of total FDI Equity inflow
reported, followed by Maharashtra (26%), Delhi (14%).
→ UNCTAD releases 2022 World Investment Report.
→ Foreign Portfolio Investors pull out Rs. 42,000 crores in June 2022 amid rising inflation and monetary policy
tightening in USA.
→ High Crude Oil prices have been advantageous for countries to inv est through their Sovereign Wealth Funds
(SWF). 6 of top 10 countries by SWFs are oil-rich economies.
→ NHAI says for new projects, it will prefer build-operate-transfer model / BOT Model. [Shift to other models:
When private company didn’t have incentives post-2011, GOI shifted to EPC and HAM models to plug funding gap.
Return to BOT could be big +ve for road sector].

Page 682 of 719

→ In recent years, returns from impact investments have witnessed good growth trajectory.
→ SEBI eases norms on AIF, VCF investments in overseas firms; drops India connection clause. Capital markets regulator
SEBI allows India registered AIFs and VCFs to invest in foreign entities without having India connection. [Earlier, one
of conditions was that such overseas investments were allowed only in those companies which had Indian
connection. Like, company has front office overseas, while having its back office operations in India]. However, no
such investments can be made in companies based in jurisdictions identified by FATF as those having anti-money
laundering (AML) or combating financing of terrorism (CFT) deficiencies. Moreover, AIFs or VCFs will be allowed to
invest in overseas investee company, which is incorporated in any country whose securities market regulator is
signatory to International Organization of Securities Commissions (IOSCO)’s Multilateral Memorandum of
Understanding or signatory to bilateral pact with SEBI. These SEBI guidelines are for protecting interest of investors
and promoting development of securities market. [Countries under FATF are barred and transfer or sale of
investment in overseas companies can only be made to entities eligible under FEMA, 1999.]
→ Loan defaulters and those facing probe will need NOC to invest abroad from now on. Finance Ministry notifies new
norms and makes it tougher for loan defaulters and those facing probe by investigative agencies to invest in overseas
entities. They will now have to secure no-objection certificate (NOC) from their lenders, or regulators or probe
agencies concerned before making overseas investments.
→ GOI constitutes one expert panel, 6-member panel headed by former SEBI Chairman M Damodaran, to suggest ways
for scaling up of venture capital / private equity investments. [Private equity and Venture capital invested more than
Rs 5.5 lakh crore in 2021 facilitating one of largest start-up and growth ecosystems in India.]
→ GOI launches one scheme – “Scheme for Special Assistance to States for Capital Investment for 2022-23”. Under this
scheme, financial assistance will be provided to State Governments in form of 50-year interest free loan for capital
investment projects.
→ GOI says that Fund of Funds for Startups (FFS), launched under Startup India initiative in 2016 with corpus of Rs
10,000 crore, has committed Rs 7,385 crore to 88 Alternative Investment Funds (AIFs) till date. These AIFs in turn
have invested crores in many startups. FFS has helped anchor some AIFs.
→ Impossible trinity - trilemma has come under focus recently as US Federal Reserve has been raising interest rates to
fight rising prices.
→ Sustainable Finance committee submits report to IFSCA suggesting development of carbon market: One expert
committee headed by former environment and forest secretary CK. Mishra submits one report on sustainable finance
suggesting development of carbon market among other things.
 Recommendations:
• Developing voluntary carbon market. Framework for transition bonds. Enabling de-risking mechanisms.
Promoting regulatory sandbox for green fintech. Facilitating creation of one global climate alliance. …
→ In one meeting held with India’s corporate leaders, FM Nirmala Sitharaman drew attention to an important aspect
of the economy today. She rightly flagged concerns about sluggish corporate investment, despite GOI’s business-
friendly stance, including a reduction in the corporate tax. The reduction, effected in 2019, lowered the rate for
existing companies to 22% from 30% and for new manufacturing companies to 15% from 25%. However, the
corporate investment rate, i.e., investment as a share of the national income, has barely budged.
→ According to a 2022 report of Ernst and Young (EY) - Confederation of Indian Industries (CII) titled “Vision – Developed
India: Opportunities and Expectations of MNCs”, India’s focus on reforms and economic growth will result in FDI of
USD 475 billion in the next 5 years. [In 2022-23 the total FDI in India was USD 84.8 billion]. [The report is based on
the survey done by the EY-CII with Multinational Companies (MNC). As per this report, India is a favourite Investment
destination for the MNC’s].
 Basis:
• Most of MNCs expect the Indian economy to perform significantly better in the next 3 to 5 years and in the
long term.
• India is seen as an emerging manufacturing hub in global value chains, a growing consumer market, and a
global leader in the digital transformation of government and private sectors alike.
• GOI initiative like PLI scheme which seeks to make domestic manufacturing globally competitive and create
global champions in manufacturing will also help India in attracting significant investment.
→ Is Europe-plus-One the new China-plus-One: With the closing of Nord Stream 1 in Russia, Europe’s gas crisis has
worsened and is slowly starting to take a permanent shape since Russia shut down the supply without intimating a
date of reopening. Consequently, there are fears looming large over the European economy and other countries.
→ Last month (September 2022), Finance Minister Nirmala Sitharaman asked captains of industry what was holding
them back from investing in manufacturing. She likened industry to Lord Hanuman from the Ramayana by stating
that the industry did not realise its own strength and that it should forge ahead with confidence. She said, “This is
the time for India… We cannot miss the bus”.
→ According to the report - Global Investment Trends Monitor, No. 43 - published by UNCTAD in 2022, the number of
climate mitigation and adaptation investment projects declined 7% and 12% respectively from January 2022 through
September 2022, as the world grapples with an economic slowdown. That, in stark contrast to the growth seen in
2021, investments shrank across industries, especially those that play a major role in tackling climate change.

Page 683 of 719

 → The Investor Education and Protection Fund Authority (IEPFA) under the aegis of Ministry of Corporate Affairs (MCA)
organizes an Investor Education, Awareness and Protection Conference in Srinagar, Jammu & Kashmir at Kashmir
International Conference.
About:
 What:
→ Dedication of asset to attain increase in value over time. Investment requires sacrifice of some present asset,
such as time, money, or effort.
In finance, purpose of investing is to generate return from inves ted asset. Return may consist of gain
(profit) or loss realized from sale of property or investment, unrealized capital appreciation (or depreciation),
or investment income such as dividends, interest, or rental income, or combination of capital gain and
income. Return may also include currency gains or losses due to changes in foreign currency exchange rates.
Investors generally expect higher returns from riskier investments. When low -risk investment is made,
return is also generally low. Similarly, high risk comes with chance of high returns.
Investors, particularly novices, are often advised to diversify their portfolio. Diversification has statistical
effect of reducing overall risk.
 Investment Models:
→ What:
 Investment is process of putting money in assets for increasing production or financial gains. That is, investment
is all about putting money in assets. And, investment models is about how to put that money in assets.
→ Need:
 More Income -> More Savings -> More Investment -> More Income. No investment -> No Growth ->
Poverty, Malnutrition, Unemployment etc. So, for more income, we need more investment.
→ Types:
 On basis of who invests in assets for increasing production, there are 3 major investment models:
• Public Investment Model:
 In Public Investment Model, government invests in specific goods and services through central or State
government, or with help of public sector, using revenue generated by it.
 For government to invest, it needs revenue (mainly tax revenue), but present tax revenues of India are
not sufficient enough to meet budgetary expenditure of India. So, India cannot move ahead in path of
growth without private individuals; even for government to have share in investment, they need tax
revenue from private investors.
• Private Investment Model:
 In India, there are times when earnings from public sector are insufficient to cover certain shortfalls
that may occur. As result, government invites private investors to participate in some of its projects.
This investment can be either domestic or international. FDI can help to improve current infrastructure
while also creating jobs. When it comes to external investment, this model is one of most popular.
 Private investment can come from India or abroad. If it is from abroad – they can be as FDI, FPI. As
India’s CAD is widening due to increased Oil import, in this age of globalization, we cannot say NO to
FDI, FPI.
Private investment in India is required because for country to grow and increase its income,
production has to be increased; more goods and services has to be produced; infrastructure to support
production – transport, energy, communication – should also be developed. But India with near 30% of
population below poverty line, do not have resource to invest in production or infrastructure.
• Public Private Partnership Model / PPP Model:
 PPP, 3P, or P3 is one long-term collaborative arrangement between two or more public and private
sectors. GOI has always believed in PPP as far as investing in growth of India is concerned. In India,
projects based on PPP model have been implemented in sectors: Health Sector; Power Sector; Railways;
Urban Housing.
 PPP means combining best benefit from both public and private investments. Some of Project Finance
Schemes are as below:
o BOT (build–operate–transfer); BOOT (build–own–operate–transfer); BOO (build–own–operate);
BLT (build–lease–transfer); DBFO (design–build–finance–operate); DBOT (design–build–operate–
transfer); DCMF (design–construct–manage–finance); EPC Model; HAM Model.
 Depending from where investment comes, there are 2 investment models:
• Domestic Investment Model:
 It can be from Public, Private, or PPP.
• Foreign Investment Model:
 It can be 100% FDI or Foreign-Domestic Mix.
 Depending on where investment goes (or how investments are planned):
• Sector Specific Investment Models (SEZ, MIZ etc).
• Cluster Investment Model (Eg: Food Processing Industries)
• …
Page 684 of 719
 → Investment Models in relation to India.
 Harrod Domar Model: This model implies that economic growth depends on policies to increase investment, by
increasing saving, and using that investment more efficiently through technological advances. That is, this Model
is more of one One-Sector Model, in which economic growth is based on policies that increase savings and
technological advancements. It suggests that there is no natural reason for economy to have balanced growth.
It was more or less One Sector Model. —> Failed to attract investment on consumer goods in India as we lacked
good capital goods industries.
 Solow Swan Model: This neo-classical model was extension to 1946 Harrod–Domar model that included one
new term - productivity growth. That is, Harrod-Domar Model was extended by this Model, which placed special
emphasis on productivity growth.
 Feldman–Mahalanobis model: One high enough capacity in capital goods sector in long-run expands capacity in
production of consumer goods. Thus essence of this model is shift in pattern of industrial investment towards
building up domestic consumption goods sector. It was one Two Sector Model which was later developed into
4 Sector Model. Also known as Nehru-Mahalanobis model. That is, this model focuses on improving domestic
consumption goods sector when capital goods sector has sufficient capacity. It later evolved into Nehru-
Mahalanobis model, which is one 4-sector model.
 Rao ManMohan Model: This Model, named after Narasimha Rao and Dr. Manmohan Singh, is one policy of
economic liberalisation and FDI that was implemented in 1999. Economic development in Lewis's model is based
on unlimited labour supply. That is, it is policy of Economic Liberilization and FDI initiated in 1991 by Narasimha
Rao and Dr. Manmohan Singh.
 Lewis model of economic development by unlimited labour supply.
 Induced Investment Model.
 Leverage Investment Model.
 Saving led growth model: This model is significant to India.
 Demand led growth model.
 Consumption led growth model.
 Infrastructure Financing: It is process of financing those industries which government identifies as central to
economy. Eg: roads, railways etc. Generally, in countries there are lists of industries identified as infrastructure.
These industries are also strategically important and therefore too much private participation in its financing
won’t be allowed. Rather governments impose regulations to avoid monopolistic tendencies. Infrastructure
assets are sources of low risk and stable cash flows.
 Investment and GDP:
→ GDP, measure of national income is given by formula: GDP = C + I + G + NX, where C is consumption
expenditure, I is investment, G is government spending, NX is net exports, given by difference between
exports and imports, X − M. Thus investment, ‘I’ is everything that remains of total expenditure after
consumption, government spending, and net exports are subtracted (i.e. I = GDP − C − G − NX). [I
corresponds to gross investment.]
 Factors affecting Investment:
→ Investment is one function of Income and Rate of Interest [I = f(Y,r)]. Higher income, more will be
investment; higher rate of interest lesser will be investment.
→ Savings Rate. Tax Rate in country (Net income available after tax). Inflation. Rate of Interest in Banks.
Possible rate of return on capital. Availability of other factors of production – cheap land, labour etc and
supporting infrastructure – transport, energy and communication. Market size and stability. Investment
friendly environment in country (policies of government).
 Free movement of capital comes with cost:
→ Impossible trinity:
 According to economists, economy cannot pursue independent monetary policy, maintain fixed
exchange rate, and allow free flow of capital across its borders at same time. This is called –
“Impossible trinity”. Impossible trinity / Impossible trilemma, refers to idea that economy cannot
pursue independent monetary policy, maintain fixed exchange rate, and allow free flow of capital
across its borders at same time. According to economists, any economy can choose to pursue only 2
out of these 3 policy options simultaneously in long-run. This idea was proposed independently by
Canadian economist Robert Mundell and British economist Marcus Fleming in 1960s.
→ Difficult choice:
 In today’s world in which capital is largely free to move across borders with ease, choice before
policymakers is between maintaining fixed exchange rate and pursuing independent monetary policy.
If policymakers choose to maintain value of their currency at certain level against foreign
currency, this decision will limit kind of monetary policy they can adopt in long-run. This is because
decision to maintain exchange value of currency can tie down hands of central bankers when it comes
to their domestic monetary policy stance. For example, if one country’s policymakers want their
currency to appreciate, or become stronger, against foreign currencies, they cannot achieve this goal
and maintain external strength of currency over considerable period of time without adopting tight
Page 685 of 719
 domestic monetary policy stance which will weaken domestic demand. This is beca use loose monetary
policy will put pressure on country’s currency to depreciate in value. Thus, policymakers will have to
choose between maintaining strength of their currency and upholding nominal demand in domestic
economy which is heavily influenced by monetary policy.
On other hand, if policymakers of country choose to pursue independent monetary policy,
they may not be able to maintain foreign exchange value of their currency at desired level. This is
because kind of monetary policy adopted by economy’ s central bank invariably influences exchange
value of its currency against foreign currencies. For example, if one country’s central bank adopts easy
monetary policy with aim of boosting domestic demand, this will naturally cause value of its currency
to depreciate against foreign currencies if foreign central banks adopt tighter monetary policy. If so,
it would be difficult to maintain foreign exchange value of currency unless central bank holds sufficient
foreign exchange reserves to prop up currency’s v alue. In fact, over long-run, it may be impossible for
country’s central bank to defend foreign exchange value of its currency as it may soon run out of
foreign exchange reserves necessary to prop up value of its currency.
→ Restricting capital movement:
 It should be noted that some decades ago, when strict capital controls were used to regulate flow of
capital across borders, economies could choose to pursue independent monetary policy and still hope
to maintain certain exchange value against foreign currencies. Whenever monetary policy exerted
undesirable effect on currency’s exchange rate, policymakers could impose controls on flow of capital
to maintain foreign exchange value of their currency. For example, if one country’s central bank
decides that it wants to adopt easy monetary policy that could weaken exchange value of its currency,
it could impose capital controls to stop depreciation of its currency. It should be noted, however, that
capital controls come at price. Capital control hinder free flow of capital and adversely affect economic
growth by preventing efficient allocation of scarce resources across globe.
→ Current trilemma:
 Today’s trilemma has come under focus recently in 2022 because US Federal Reserve has been raising
interest rates to fight rising prices. In world where capital is largely free to move across borders, US
Fed’s raise has led many investors to pull money out of rest of world and rush to USA in search of
higher yields, thus putting pressure on many currencies such as Indian rupee. In fact, even developed
markets like Japan, Eurozone have seen their currencies depreciate significantly against US dollar.
Notably Japan, in contrast to other national central banks, has been unwilling to tighten its monetary
policy in response to rising interest rates in US. This has caused Japanese currency, Yen, to depreciate
about 25% against US dollar so far in 2022. In essence, Bank of Japan has allowed its currency to fall,
preferring to maintain control over its domestic monetary policy.
India: RBI may also face this dilemma of choosing between maintaining value of rupee and
holding on to its monetary policy independence. As US Federal Reserve has raised interest rates, there
has been increasing pressure on rupee, which has depreciated almost 10% a gainst US dollar in 2022.
For now, RBI seems to be fairly happy tightening its monetary policy stance to defend rupee as it also
helps to rein in price rise which has been one concern even in India. But if US Federal Reserve continues
to tighten its policy stance even after price rise in India is reined in by RBI, then RBI may have to choose
between defending Indian rupee and upholding domestic demand.
 Sustainable finance / Green Finance:
→ What:
 It is defined as investment decisions that take into account environmental, social, and governance (ESG) factors
of economic activity or project.
Sustainable finance or green finance is set of financial regulations, standards, norms and products that
pursue environmental objective, and in particular to facilitate energy transition. It allows financial system to
connect with economy and its populations by financing its agents while maintaining growth objective.
Long-standing concept was promoted with adoption of Paris Climate Agreement, which stipulates that
parties must make "finance flows consistent with pathway towards low GHG emissions and climate-resilient
development."
In 2015, UN adopted 2030 Agenda to steer transition towards sustainable and inclusive economy. This
commitment involves 193 member states and comprises 17 goals and 169 targets SDGs aimed at tackling current
global challenges, including protecting planet. Sustainable finance has become one key cornerstone for
achievement of these goals.
→ Feature:
 3 pillars of sustainable finance:
• CSR: Corporate activities that contribute to sustainable finance.
• Sustainable and responsible investing i.e. investors supporting sustainable companies.
• Environmental, Social, and Governance (ESG) criteria to measure impact of investments and businesses.
 Private investment / Corporate investment:
→ Status:
Page 686 of 719
  In one meeting held with India’s corporate leaders, FM Nirmala Sitharaman drew attention to an important
aspect of the economy today. She rightly flagged concerns about sluggish corporate investment.
 Private investment accounts for about 75% of total capital formation in Indian economy, and thus its revival
is essential for sustained growth of Indian economy.
 Current scenario in 2022:
• Gross Fixed Capital Formation (GFCF) is primarily driven by the public sector.
• The share of manufacturing in the India’s GDP, too, has remained stagnant at about 16-17% for decades
now (as against the target of 25%).
• Demand in consumption is low (below the pre-pandemic level) but is expected to pick up. As per an online
survey (by UBS Evidence Lab India), there is high purchase intention for cars and 2-wheelers, a diverging
trend for property, and moderation for some consumer durables including computers / laptops,
refrigerators, and ACs. Household savings intention remains high with 56% of respondents indicating they
plan to increase their savings by 2022 year-end.
• Thus there is greater optimism for economic rebounding and thus FM Nirmala Sitharaman called in 2022 on
industries to invest more to reap the benefits of a growing economy.
→ Issue:
 Lack of corporate investment:
• In one meeting held in 2022 with India’s corporate leaders, FM Nirmala Sitharaman drew attention to an
important aspect of the economy today. She rightly flagged concerns about sluggish corporate investment,
despite GOI’s business-friendly stance, including a reduction in the corporate tax. The reduction, effected
in 2019, lowered the rate for existing companies to 22% from 30% and for new manufacturing companies
to 15% from 25%. However, the corporate investment rate, i.e., investment as a share of the national
income, has barely budged.
Despite GOI bringing down corporate tax (from 30% to 22%; and to 15% for new manufacturing
companies), India’s investment rate (though among the highest in the world) has declined to about 31% of
GDP as an average of 2015-16 to 2019-20 from its peak of 39% in FY2012. Corporate investment accounts
for only about ½ of total investments, i.e. about 15% of GDP.
• Reasons for this decline:
 Slowing down of the global economy, post-2008 global financial crisis, and present fear of slowdown
due to 2022 Ukraine war and US Fed tightening.
 Sluggish growth of Indian Agriculture sector.
 Low investment sentiments in the corporate sector.
 Stagnant public investment whose contribution to GDP is only around 2.2%.
• Lack of industrial investment:
 In said 2022, Finance Minister Nirmala Sitharaman asked captains of industry what was holding them
back from investing in manufacturing. She likened industry to Lord Hanuman from the Ramayana by
stating that the industry did not realise its own strength and that it should forge ahead with confidence.
She said, “This is the time for India… We cannot miss the bus”.
 Why did she urge them thus?
o Clearly, the Finance Minister did not see investments happening at a pace she would have liked. In
the hope of revitalising private investment, GOI had in 2019 cut the tax rate for domestic
companies from 30% to 22% if they stopped availing of any other tax SOP (standard operating
procedure).
o In 2022, Niranjan Rajadhyaksha, CEO of Artha Global, says that Indian private sector investment
has been weak for almost a decade now. India’s export will be under threat because of the global
slowdown, the GOI’s ability to support domestic demand would also be limited because of fiscal
issues. Because of the K-shaped recovery, private consumption is only concentrated in some parts
of the income pyramid.
 What is the current scenario in 2022?
o In the GDP figures for the quarter ended June 2022, gross fixed capital formation (GFCF) at 2011-
12 prices rose 9.6% to Rs. 12.77 lakh crore, from Rs. 11.66 lakh crore in Q1 of FY20, which was the
pre-pandemic period. This is in context of the overall GDP growth of 2.8% to Rs. 36.85 lakh crore
in Q1 FY23 from Rs. 35.85 lakh crore in Q1 of FY20. Manufacturing GVA (gross value added) also
rose 6.5% to Rs. 6,05,104 in Q1 FY23 from Rs. 5,68,104 in Q1, FY20. However, when one observes
manufacturing growth from the immediately preceding quarter April-June vs January-March, we
see that the manufacturing sector has suffered a 10.5% contraction. While private final
consumption expenditure, an essential pillar of our economy, climbed 26% year-on-year for the
June quarter, the ₹22.08 lakh crore of private spending in April-June 2022 was a significant ₹54,000
crore, or 2.4%, less than that spent in the preceding quarter. And GFCF, which is viewed as a proxy
for private investment, shrank quarter-on-quarter by 6.8%.
o Pulapre Balakrishnan, who teaches at Ashoka University at Sonipat in Haryana, argued that capital
expenditure by the government is a precursor to private investment but that it would take a
Page 687 of 719
 sustained trend in public spending, for about half a decade at least, to help kindle enthusiasm in
the private sector. While GOI’s intent to spend aggressively on infrastructure in its Budget for fiscal
2022-23 is encouraging, he says this cycle should have started a few years ago. With the GOI having
now announced intent, he says it must now focus on a couple of priorities:
✓ one that GOI must identify the right projects — investments must be made in productivity-
enhancing infrastructure.
✓ Two, he warns that inflation could derail the best designed public spending programmes, and
urges a step up in agricultural produce to help rein in food inflation.
 What is happening to demand in 2022?
o Private companies invest when they are able to estimate profits, and that comes from demand.
The Centre for Monitoring Indian Economy’s (CMIE) consumer sentiment index is still below pre-
pandemic levels but is far higher than what was seen in 2021. RBI’s Monetary policy report
published in 2022 says, “Data for Q2 [ended Sept 2022] indicate that aggregate demand remained
buoyant, supported by the ongoing recovery in private consumption and investment demand.” It
shows that seasonally adjusted capacity utilisation rose to 74.3% in Q1 — the highest in the last 3
years. Manufacturing firms recorded a sequential uptick in new orders while infrastructure firms
displayed optimism on the overall business situation, turnover and employment in Q2: 2022-23.
o On state of the economy, RBI’s monthly bulletin, released in October 2022, emphasised that
contact-intensive sectors would likely lead the rejuvenation as the restraint due to the pandemic
has waned. Festival-related spending was already boosting consumption demand with +ve
externalities for other components of domestic demand.
o Dr. Rajadhyaksha of Artha Global says capacity utilisation is now much better than what it was
during the pandemic when it had slipped to 67-68%. He says the general thumb rule is that the
capital expenditure cycle really picks up when capacity utilisation reaches about 78-80%. We are
hovering in that region but aren’t there yet. He guesses that, in the coming months, the private
investment cycle should pick up, unless there is some real outlier event which sets the entire global
economy back.
o An online survey by UBS Evidence Lab India on consumption outlook was conducted in August 2022
with 1,500 consumers. Nearly 3/4th of the respondents noted stable or increasing income levels in
this survey (versus 54% in the Aug 2021 survey). Results suggest high purchase intention for cars
and 2-wheelers, a diverging trend for property, and moderation for some consumer durables
(including computer / laptop, refrigerator, ACs). [The survey largely relates to the ‘higher income’
or ‘upper middle income’ sections of India’s income pyramid on a socio-economic classification and
hence is not representative of the larger population, according to UBS]. Household savings
intention remains high with 56% of respondents indicating they plan to increase their savings by
2022 year-end.
o And that might hold the key to the investment cycle kicking in, in response to the Finance Minister’s
exhortations.
→ Initiative:
 GOI shifted away from a state-driven model of economic development – like ‘minimum government’.
 GOI has been working to improve the ease of doing business in India.
 GOI’s business-friendly stance including a reduction in the corporate tax. The reduction, effected in 2019,
lowered the rate for existing companies to 22% from 30% and for new manufacturing companies to 15% from
25%.
 Status of investment in India:
→ In 2022, India is 5th most attractive manufacturing destination, with its 20 crores strong middle class and
growing consumer market.
→ India is an important destination for MNCs’ global expansion, 71% of MNCs, working in India feel so.
→ India received USD 58.8 billion FDI in FY 2022 in spite of headwinds in global and domestic economic
environment. In 2022-23, the total FDI in India was USD 84.8 billion.
 Investment in China:
→ China Plus One / Plus One / C+1:
 What:
• It is the business strategy to avoid investing only in China and diversify business into other countries. For
the last 20 years, western companies have invested in China, drawn in by their low production costs, and
enormous domestic consumer markets. China-plus-one is a strategy in which companies avoid investing
only in China and diversify their businesses to alternative destinations.
 Why:
• China was an attractive investment location due to the low cost of labour and production and an increasing
domestic consumer market. Companies started to think of alternative locations to invest because of the
supply chain disruptions during recent years caused by the Covid pandemic and China’s Zero-Covid policy.
This was fueled by associated container shortage thus causing uncertainty and disrupted the supply of
Page 688 of 719
 materials. Additionally, China brought out a data privacy law that specified how they collect and store data.
This caused foreign technology companies to downsize their presence in China’s mainland.
 Significance:
• The China-plus-one model gave the EU, Mexico, Taiwan, and Vietnam a boost because companies began
investing in these alternate locations. India was also at an advantage since MNCs started investing in
emerging countries and India was a viable option because of its low production cost and favorable business
environment.
 Issue:
→ Lack of corporate investment: In one meeting held in 2022 with India’s corporate leaders, FM Nirmala Sitharaman
drew attention to an important aspect of the economy today. She rightly flagged concerns about sluggish corporate
investment, despite GOI’s business-friendly stance, including a reduction in the corporate tax. The reduction,
effected in 2019, lowered the rate for existing companies to 22% from 30% and for new manufacturing companies
to 15% from 25%. However, the corporate investment rate, i.e., investment as a share of the national income, has
barely budged.
Despite GOI bringing down corporate tax (from 30% to 22%; and to 15% for new manufacturing companies),
India’s investment rate (though among the highest in the world) has declined to about 31% of GDP as an average of
2015-16 to 2019-20 from its peak of 39% in FY2012. Corporate investment accounts for only about ½ of total
investments, i.e. about 15% of GDP.
 Challenge:
→ India needs corporate investment / private investment. However, private firms are driven by profit expectations.
Managers are averse to risk, and unlikely to rush to invest based on exhortation from a GOI Minister if they do not
anticipate enough profits.
 Initiative:
→ In the budget 2022-23, the outlay for capital expenditure stepped up sharply by 35.4% to Rs. 7.50 lakh crore.
→ National Infrastructure Pipeline.
→ PM Gati Shakti scheme.
→ National Monetisation Pipeline.
→ GOI has been focusing on investment in productivity-enhancing infrastructure.
→ PLI Scheme.
→ Reduction in regulatory barriers, for example - PARIVESH Portal for single window environmental clearances; new
labour codes; etc.
 Way Forward:
→ Corporates should increase their investments: In this context, in 2022, FM Sitharaman challenged corporate
leaders to invest, asking them rhetorically whether, like Hanuman in the Ramayana, they needed to be
reminded of their inborn strength.
Note:
 International Organization of Securities Commissions (IOSCO) [1983]:
→ What:
 association of organizations that regulate world's securities and futures markets. Members are typically primary
securities and / or futures regulators in national jurisdiction or main financial regulator from each country.
IOSCO has members from over 100 countries, who regulate more than 95% of world's securities markets. It has
one permanent secretariat in Madrid, Spain. international body of world’s securities regulators. sets global
standard for securities sector.
international body for securities regulators (e.g. SEBI in India) and set standards for them. Currently
from India, SEBI is ordinary member, IFSCA is one associate member. NSE, BSE, and Multi-commodity exchange
of India are affiliate members.
→ Mandate:
 Develop, implement, promote high standards of regulation.
 Share information with exchanges and assist them with technical and operational issues.
 Establish standards toward monitoring global investment transactions across borders and markets.
→ India:
 SEBI, India – member
 IFSCA, India - associate member.
 Foreign Direct Investment (FDI):
→ What:
 investment in form of controlling ownership in business in one country by entity based in another country. FDI
is distinguished from FPI by notion of direct control. FDI is one investment from party in one country into
business or corporation in another country with intention of establishing lasting interest. With FDI, foreign
companies are directly involved with day-to-day operations in that other country. FDI is thus distinguished from
FPI by notion of direct control.
→ Types:

Page 689 of 719

 
{Greenfield investment} {Brownfield investment}
company builds its own, brand-new facilities from company purchases or leases existing facility.
ground up.
parent company opens subsidiary in another country. Entity purchases or leases existing facility to begin new
Instead of buying existing facility in that country, production. Companies may consider this approach a
company begins new venture by constructing new great time and money saver since there is no need to
facilities in that country. Construction projects may go through building brand new building.
include more than just production facility. They
sometimes also entail completion of offices,
accommodations for company's staff, management,
distribution centers.
Companies may need to undergo permitting process. Companies need not undergo permitting process.
→ India:
 Status: Ministry of Commerce said in 2022 that total FDI received in 2021-22 was USD 84bn (highest annual
inflow). Top Source: Singapore, USA, Mauritius. Top destination State: Karnataka, MH, Delhi. Top sectors
receiving FDI: Computer and IT, Services Sector, Automobile. Increased FDI in Manufacturing (by 76%) to USD
21bn in comparison to 2020-21.
 India’s FDI Routes:
• Category 1: 100% FDI through Automatic Route (no need for RBI’s or government’s approval e.g. 100% FDI
allowed on Medical devices, thermal powers).
• Category 2: Up to 100% FDI through Government Route (will need government’s permission) e.g. Core
Investment Company (100%), Multi-brand retail trade (51%).
• Category 3: Up to 100% FDI through Automatic + Government Route.
 Foreign Portfolio Investment (FPI):
→ What:
 grouping of assets (stocks, bonds, cash equivalents, equity, debt). Portfolio investments are held directly by
investor or managed by financial professionals. In economics, FPI is entry of funds into one country where
foreigners deposit money in that country's bank or make purchases in that country's stock and bond markets,
sometimes for speculation. FPI involves investor buying foreign financial assets such as fixed deposits, stocks,
mutual funds. All investments are passively held by investor.
→ Type:
 Voluntary Retention Route (VRR):
• What:
 new channel of investment available to FPIs to encourage them to invest in debt markets in India over
and above their investments through regular route. allows FPIs to participate in repo transactions and
also invest in exchange traded funds that invest in debt instruments.
• Objective:
 attract long-term and stable FPI investments into debt markets while providing FPIs with operational
flexibility to manage their investments.
• VRR vs regular FPI investments:
 investments through VRR will be free of macro-prudential and other regulatory prescriptions applicable
to FPI investments in debt markets, provided FPIs voluntarily commit to retain required minimum % of
their investments in India for period of their choice.
• Top countries for FPI flows to India:
 USA, Mauritius, Singapore, Luxembourg, UK
→ How do FPIs operate?
 In times of global uncertainty (like 2022 Ukraine war), FII moves money from risky assets such as equities and
add more bonds and gold. When interest rates rise in USA and other advanced economies, FIIs withdraw money
from emerging markets such as India and invest in bonds in their domestic markets.
→ How big are FII in India?
 In India, FPIs are largest non-promoter shareholders in Indian market and their investment decisions have huge
bearing on stock prices and overall direction of Indian financial market.
→ What happens when FPI Investors pull out money from India?
 Case study:
• Event:
 In June 2022, Foreign Portfolio Investors pulled out Rs. 42,000 crores amid rising inflation and
monetary policy tightening in USA.
• Why is capital flowing out from India?
 Playing safe: FPI Investors see relatively high valuations in India, rising bond yields in USA, appreciating
dollar and concerns regarding possibility of recession in US triggered by rate hike in USA.

Page 690 of 719

  In India, inflation surged to 8-year high of about 8%, prompting RBI to hike repo rate.
• How does it impact markets and Indian rupee?
 India’s Forex reserves is falling, mainly due to USD appreciation, FPI withdrawals. FPI withdrawals will
lead to Indian rupee depreciation and which may lead to higher import bills. Strong dollar (and weaker
rupee) is good for export-oriented Indian companies but bad for import-oriented India industries such
as oil, gas, chemicals. With dip in Indian rupee, oil imports and other imported components will get
costlier, which will further lead to higher inflation. Indian rupee has continued to depreciate despite
RBI selling dollars from its forex reserve to stabilise Indian currency. Rise in US inflation, rate hike
worries and stock market fall may drive further weakening of Indian rupee in India.
 FDI vs FPI:
→
{FDI} {FPI}
Direct control over assets and say in affairs of Investors do not have direct control / management
company. of their investments.
Investors is tied up with affairs of company and No control or share in assets or properties and
faces higher risk. hence provides more liquidity.
Preferred mode for companies, high-net-worth More suited for average retail investors.
individuals and institutional investors
FDI only targets specific sectors. FII helps in increasing capital availability i n
general.
Both FDI and FII are related to investment in Both FDI and FII are related to investment in
country. country.
 Sovereign Wealth Fund (SWF) / Sovereign Investment Fund (SIF) / Social Wealth Fund:
→ What:
 One state-owned investment fund that invests in real and financial assets such as stocks, bonds, real estate,
precious metals, or in alternative investments such as private equity fund or hedge funds. SWFs invest globally.
Most SWFs are funded by revenues from commodity exports or from Forex reserves held by central bank. It is
one state-owned investment fund comprised of money generated by government, often derived from country’s
surplus reserves.
→ Type:
 Some SWFs may be held by central bank, which accumulates funds in course of its management of nation's
banking system; this type of fund is usually of major economic and fiscal importance. Other sovereign wealth
funds are simply state savings that are invested by various entities for purposes of investment return, and that
may not have significant role in fiscal management.
→ Example:
 Accumulated funds may have their origin in, or may represent, foreign currency deposits, gold, special drawing
rights (SDRs) and IMF reserve positions held by central banks and monetary authorities, along with other
national assets such as pension investments, oil funds, or other industrial and financial holdings. These are assets
of sovereign nations that are typically held in domestic and different reserve currencies (such as dollar, euro,
pound, yen). Such investment management entities may be set up as official investment companies, state
pension funds, or sovereign funds, among others.
→ Significance:
 Oil-rich countries such as Norway, those in West Asia, and others such as China use SWFs to invest in businesses,
both at home and abroad.
 +ve Current account balance: One common underpinning of most major SWFs is surplus in current account. E.g.
Kuwait’s current account balance was about 21% of GDP in 2021 (India’s is 1.1% of its GDP).
 Ubharte Sitaare Fund:
→ What:
 AIF for export-oriented MSMEs. set up by Exim Bank and SIDBI.
→ Objective:
 Help Indian enterprises with export potential, but which are currently underperforming or unable to tap their
potential to grow.
 Encourage MSMEs [vital to economy in creating jobs, fostering innovations, reviving economy].
→ Feature:
 both financial and advisory services.
 It has Greenshoe Option of crores of rupees.
 covers companies across various sectors - pharma, auto, engineering solutions, agriculture, software etc.
→ Significance:
 It identifies Indian companies with potential to be future champions.
 Enabling MSME to expand their ventures and thereby driving overall economy
 Boost to sector specific growth - ‘One District One Product’ of Ministry of Food Processing Industries.

Page 691 of 719

 Greenshoe Option:
→ over-allotment option. In context of IPO, it is provision in underwriting agreement that grants underwriter
right to sell, to investors, more shares than initially planned by issuer if demand for security issue proves
higher than expected.
 Reverse Greenshoe Option:
→ special provision in IPO, which allows underwriters to sell shares back to issuer. If 'regular' greenshoe is
‘call option’ written by issuer for underwriters, then reverse greenshoe is ‘put option’.
 World Investment Report:
→ What:
 This report is released annually by UNCTAD. It focuses on trends in FDI worldwide, at regional and country levels
and emerging measures to improve its contribution to development. It also provides analysis on global value
chains and operations of multinational enterprises, with special attention to their development implications.
→ Feature:
 Its overviews are available in all official UN languages.
 Every issue of this Report has:
• Analysis of trends in FDI during previous year, with especial emphasis on development implications. Ranking
of largest transnational corporations in world. In-depth analysis of selected topic related to FDI. Policy
analysis and recommendations. Statistical annex with data on FDI flows and stocks at country level.
→ 2022 World Investment Report:
 Highlights:
• India is ranked 7th despite 30% decline in FDI into it. United States remains top recipient of FDI. China and
Hong Kong also retained 2nd and 3rd position respectively. Among top 10 host economies, only India saw
decline in its inflows. However, outward FDI from India rose 43% in 2021. Top 10 FDI recipients: USA, China,
Hong Kong, Singapore, Canada, Brazil, India, …
 Alternative Investment Fund (AIF):
→ What:
 pooled investment funds. AIF refers to investment which differs from conventional investment avenues - stocks,
debt securities etc.
According to SEBI, AIF means any fund established or incorporated in India which is privately pooled
investment vehicle which collects funds from sophisticated investors, whether Indian or foreign, for investing it
in accordance with defined investment policy for benefit of its investors.
→ Feature:
 AIF does not include funds covered under SEBI (Mutual Funds) Regulations, 1996, SEBI (Collective Investment
Schemes) Regulations, 1999 or any other regulations of SEBI to regulate fund management activities. Further,
certain exemptions from registration are provided under AIF Regulations to family trusts set up for benefit of
'relatives‘ as defined under Companies Act, 1956, employee welfare trusts or gratuity trusts set up for benefit
of employees, 'holding companies‘ within meaning of Companies Act, 1956 etc.
 AIF are invested in: venture capital, private equity, hedge funds, managed futures etc.
 AIF does not include funds covered under:
• Securities and Exchange Board of India (Mutual Funds) Regulations, 1996
• Securities and Exchange Board of India (Collective Investment Schemes) Regulations, 1999
• any other regulations of SEBI to regulate fund management activities.
But still, AIF must be registered with SEBI.
 According to SEBI, applicants can seek registration as AIF in one of following categories: and in sub-categories
thereof:
• Category I AIF:
 AIFs that invest in early-stage ventures in areas that are desirable for social and economic growth.
 Example - Venture Capital Funds (including Angel Funds), SME Funds, Social Venture Funds,
Infrastructure funds.
• Category II AIF:
 Investment in equity and debt securities. Example – Private Equity Fund, Debt Fund, Fund of funds.
• Category III AIF:
 Funds that leverage using different kinds of instruments or use different trading strategies for returns.
 Example - Hedge fund, Private investment in public equity (PIPE) fund.
→ Benefit:
 AIF helps in diversified investment in various sectors.
 Reduce dependence on foreign capital.
 Reduce impact of market volatility.
 Venture capital (VC):
→ One form of private equity financing that is provided by venture capital firms or funds to startups, early-stage, and
emerging companies that have been deemed to have high growth potential or which have demonstrated high growth

Page 692 of 719

 (in terms of number of employees, annual revenue, scale of operations, etc). Venture capital firms or funds invest in
these early-stage companies in exchange for equity, or ownership stake. Venture capitalists take on risk of financing
risky start-ups in hopes that some of firms they support will become successful. Because startups face high
uncertainty, VC investments have high rates of failure. Start-ups are usually based on innovative technology or
business model and they are usually from high technology industries, such as IT, clean technology or biotechnology.
Venture capital (VC) is one form of private equity and type of financing that investors provide to startup
companies and small businesses that are believed to have long-term growth potential.
Venture capital generally comes from well-off investors, investment banks, and any other financial institutions.
Benefit is that, while banks may find it risky and thus not give loan, VC may lend money to that risky idea startup.
→ Venture Capital Fund (VCF):
 Investment funds that help investors seeking private equities in startups, small, and mid-sized enterprises
possessing strong growth potential, by managing their money are known as Venture Capital Funds (VCF). They
are institutions that are dedicated to funding new ventures and are regulated by guidelines issued by SEBI.
Though there is high-risk involved in funding new projects, investors are eager to do so because they anticipate
high returns on investment.
VCFs ensure that money of investors is used to fund projects which have potential to grow and money
provided in process is known as Venture Capital. VCFs are given out on basis of company's assets, size and stage
of product development. Since these firms in question are usually start-up / small in size, they are said to have
high-risk / high-return profiles.
 It is one type of AIF but here major investment is in Startups or SMEs (which have greater growth potential, but
more risks).
 Private equity (PE):
→ It typically refers to investment funds, generally organized as limited partnerships, that buy and restructure
companies. More formally, private equity is one type of equity and one of asset classes consisting of equity securities
and debt in operating companies that are not publicly traded on stock exchange. That is, Private equity is one
alternative investment class that invests in or acquires private companies that are not listed on public stock exchange.
Private-equity investment will generally be made by private-equity firm, venture capital firm or angel investor.
Each of these categories of investors has its own set of goals, preferences and investment strategies; however, all
provide working capital to target company to nurture expansion, new-product development, or restructuring of
company's operations, management, or ownership.
Private equity is also often grouped into broader category called "private capital", generally used to describe
capital supporting any long-term, illiquid investment strategy.
 Special Window for Completion of Affordable and Mid-income Housing (Swamih Investment Fund) [2019]:
→ What:
 Investment Fund. It is one Category-II AIF (Alternate Investment Fund) debt fund, registered with SEBI.
→ Purpose:
 To complete construction of stalled, RERA-registered affordable and mid-income category housing projects
which are stuck due to lack of funds.
 It will provide last mile funding to stressed affordable and middle-income housing project.
→ Investment Manager: SBICAP Ventures, wholly-owned subsidiary of SBI Capital Markets, which in turn is wholly-
owned subsidiary of SBI.
→ Sponsor: Secretary, Department of Economic Affairs, Ministry of Finance.
→ Investors of SWAMIH fund: Government; Private investors - cash-rich financial institutions, sovereign wealth funds,
public and private banks, domestic pension, provident funds, global pension funds etc.
 Investment fund:
→ It is one way of investing money alongside other investors in order to benefit from inherent advantages of working
as part of group such as reducing risks of investment by significant %. These advantages include ability to: hire
professional investment managers, who may offer better returns and more adequate risk management; benefit from
economies of scale, i.e., lower transaction costs; increase asset diversification to reduce some unsystematic risk.
 Build–Operate–Transfer Model / BOT Model:
→ What:
 Here, Private partner is responsible for design, build, operate (during contracted period) and they transfer back
that facility to public sector. Under BOT model, private player will finance, build and operate project for period
of time (20 or 30-year period say). Developers will be recouping investments by way of user charges or tolls
charged from customers using that facility. This is most widely used model by government.
→ Trend:
 This BOT (toll) model was preferred model for road projects, accounting for 96% of all projects awarded in 2011-
12. But this progressively reduced to 0.
Shift to other models: When private company didn’t have incentives post-2011, GOI shifted to EPC and
HAM models to plug funding gap.
 Engineering, Procurement and Construction Model / EPC Model:
→ What:
Page 693 of 719
  This Model partnership requires government to undertake total funding of project while Private sector partner
will provide engineering and construction requirements. Cost is completely borne by govt., and govt. invites bids
for engineering knowledge from private players.
 Hybrid Annuity Model / HAM Model:
→ What:
 In technical terms, hybrid annuity stands for combination in which government makes payment in fixed amount
in beginning and then in variable amount at later stage. Indian model HAM is combination of BOT Model and
EPC Model. GOI used this model to overcome limitations of previous PPP models in road construction. Large
number of projects were found to be stalled and becoming financial liabilities under other models. While BOT
puts financial liability on private entity; EPC puts it on government, HAM is mix of BOT Annuity and EPC.
→ Phase:
 Bidding Phase: Project awarded to lowest private bidder. Funding Phase: 40% by govt, 60% by private.
Construction phase: handed over to government after completion. Concession period: Govt. will pay back 60%
as annuity.
 Impact investing:
→ What:
 It refers to investments made into companies, organizations, and funds with intention to generate measurable,
beneficial social or environmental impact alongside financial return. At its core, impact investing is about
alignment of investor's beliefs and values with allocation of capital to address social and / or environmental
issues. Impact investors actively seek to place capital in businesses, nonprofits, and funds in industries such as
renewable energy, housing, healthcare, education, microfinance, sustainable agriculture.
→ Feature:
 Impact investing occurs across asset classes; for example, private equity / venture capital, debt, and fixed
income.
 Impact investments can be made in either emerging or developed markets, and depending on goals of investors,
can target range of returns from below-market to above-market rates.
→ Examples:
 Waste management company: It provides end-to-end waste management services for corporates, apartment
complexes, etc. Therefore, it keeps environment clean while generating profit.
 One Mumbai-based courier company: It employs hearing impaired youth, and in process not only creates
employment opportunities for capable individuals but also leverages opportunities in logistics industry to
generate profits.
→ Regulation:
 Impact funds (similar to Venture Capital funds) are registered and regulated by SEBI as category I Alternative
Investment Fund (AIF). [AIF-I are funds that intend to invest in early-stage ventures or social ventures or SMEs
or areas that government or regulators consider as socially or economically desirable].
 Environmental, Social, and Governance investing / ESG investing:
→ It screens broadly for Environmental, Social, and Governance policies.
 Capital Investment:
→ It is acquisition of physical assets by company for use in furthering its long-term business goals and objectives. Real
estate, manufacturing plants, and machinery are among assets that are purchased as capital investments. It is money
spent on acquiring assets while revenue expenditure indicates daily operations expenses like salaries and pensions.
 Impossible trinity / Impossible trilemma / Unholy Trinity:
→ What:
 Impossible trinity is one concept in international economics which states that it is impossible to have all 3 of
following at same time:
• fixed foreign exchange rate;
• free capital movement (absence of capital controls);
• independent monetary policy.
→ Origin:
 It is both hypothesis based on uncovered interest rate parity condition, and finding from empirical studies where
governments that have tried to simultaneously pursue all 3 goals have failed. This concept was developed
independently by both John Marcus Fleming in 1962 and Robert Alexander Mundell between 1960 and 1963.
→ Example:
 Historically in advanced economies, periods pre-1914 and 1970–2014 were characterized by stable foreign
exchange rates and free capital movement, whereas monetary autonomy was limited. Periods 1914–1924 and
1950–1969 had restrictions on capital movement (e.g. capital controls), but exchange rate stability and
monetary autonomy were present.
 Consumer Confidence Index (CCI):
→ CCI is an economic indicator published by various organizations in several countries. In simple terms, increased
consumer confidence indicates economic growth in which consumers are spending money, indicating higher

Page 694 of 719

 consumption. Decreasing consumer confidence implies slowing economic growth, and so consumers are likely to
decrease their spending. The idea is that the more confident people feel about the economy and their jobs and
incomes, the more likely they are to make purchases. Declining consumer confidence is a sign of slowing economic
growth and may indicate that the economy is headed into trouble. CCI is key to economic growth as consumption
increases when they feel confident about the present economic situation and their own financial conditions.
→ CCI is a survey, administered by The Conference Board, based in New York, that measures how optimistic or
pessimistic consumers are regarding their expected financial situation. The CCI is based on the premise that if
consumers are optimistic, they will spend more and stimulate the economy but if they are pessimistic then their
spending patterns could lead to an economic slowdown or recession.
 Public sector vs Private sector:
→
{Public sector} {Private sector}
Provides public goods. Profit incentive to be efficient.
Not affected by recession. Entrepreneurs create jobs where needed.
Govt.’s jobs to protect environment Less bureaucracy, less scope of corruption.
Helps reduce inequality in society. Does not require taxes to fund.
 Investor Education and Protection Fund Authority (IEPFA) [2016]:
→ What:
 For administration of Investor Education and Protection Fund (IEPF), GOI in 2016 established Investor Education
and Protection Fund Authority (IEPFA) under the provisions of Companies Act, 2013. IEPFA is under the aegis of
Ministry of Corporate Affairs (MCA).
→ Objective:
 Promoting Investor Education, Awareness and Protection.
 Administration of IEPF fund.
→ Function:
 The IEPFA Authority is entrusted with the responsibility of administration of the Investor Education Protection
Fund (IEPF), making refunds of shares, unclaimed dividends, matured deposits / debentures etc. to investors,
promoting awareness among investors, and protecting the interests of the investors.
→ Initiative:
 In 2022, IEPFA under the aegis of Ministry of Corporate Affairs (MCA) organized an Investor Education,
Awareness and Protection Conference in Srinagar, Jammu & Kashmir at Kashmir International Conference.
During this inaugural session, IEPFA and MCA released the following major initiatives:
• IEPFA Mascot “Fundoo” was selected. The mascot is conceptualised with an idea symbolizing IEPFA’s vision
of taking investor awareness to the last mile with the objective of making it easier to connect with its
message, mandate and initiatives.
• “Niveshak Didi” - a unique endeavour of IEPFA with India Post Payments Bank wherein Investor Education
will be promoted in “By the women, for the women” concept. The Niveshak Didi i.e. female Dakiya has
intense social connect to the rural population especially women.
• “Niveshak Sarathi” - an investor awareness van was flagged. It is an initiative by IEPFA to promote financial
literacy among people in far-flung areas by spreading knowledge through dedicated audio-visual and print
material & a specially designed van equipped with a TV display, public announcement system, internet
connectivity etc.
• “Investors’ Handbook” - a concise compilation of information on savings, budgeting, and investments and
provide a vast knowledge of financial instruments in capsule form thereby enabling them to make informed
and sensible financial decisions.
• “75 dedicated IAPs” in the Union territory of J&K to involve stakeholders of different segments of society in
the caravan of Investor Awareness.
→ Achievement:
 It has undertaken a wide gamut of activities to accelerate the pace of investor education among the masses at
large. By 2022, more than 65,000 Investor Awareness Programmes covering above 30 lakh citizens have been
conducted by IEPFA. In addition, more than 28,000 claim refunds have been approved with transfer of about 1.6
crore shares and related dividends.
→ Investor Education Protection Fund (IEPF):
 IEPF is funded by amounts such as dividends, applications money, matured deposits etc, which have remained
unpaid or unclaimed for a period of 7 years.
 It is maintained under the Consolidated Fund of India (Article 266).
Glossary:
 Ernst & Young Global Limited (EY):
→ It is a multinational professional services partnership, headquartered in London, England. EY is one of the largest
professional services networks in the world. Along with Deloitte, KPMG and PricewaterhouseCoopers (PWC), it is
considered one of the Big 4 accounting firms. It primarily provides assurance (which includes financial audit), tax,

Page 695 of 719

 consulting and advisory services to its clients. Like many of the larger accounting firms in recent years, EY has
expanded into markets adjacent to accounting, including strategy, operations, HR, technology, and financial services
consulting.
→ It is a British multinational consultancy company.
 Confederation of Indian Industry (CII) [1895]:
→ It is a non-governmental trade association and advocacy group headquartered in New Delhi, India, founded in 1895.
CII engages business, political, academic, and other leaders of society to shape global, regional, and industry agendas.
It is a membership-based organisation.
→ CII is an Indian business lobby of companies in India. It is registered under Societies Registration Act, 1860.
Value Addition:
 Agreement on Trade Related Investment Measures (TRIMS):
→ WTO’s TRIMS recognizes that certain investment measures can restrict and distort trade. It states that
WTO members may not apply any measure that discriminates against foreign products or that leads to
quantitative restrictions, both of which violate basic WTO principles. That is, TRIMS prohibit quantitative
restrictions on imports by foreign investors. List of prohibited TRIMS, such as local content requirements,
is part of TRIMS Agreement. TRIMS Committee monitors operation and implementation of TRIMS
Agreement and allows members opportunity to consult on any relevant matters. TRIMS Agreement is not
concerned with regulation of foreign investment.
Question:
 With reference to FDI in India, one of its major characteristics is that FDI is largely non-debt creating capital flow.
Mains Link:
 Examine the role played by Foreign Direct Investment and Foreign Institutional Investors in the economy of the
developing countries. (150 words, 10 marks)
 Explain the meaning of investment in an economy in terms of capital formation.Discuss the factors to be considered while
designing a concession agreement between a public entity and private entity.(UPSC 2020)

ENERGY / POWER
News:
 2017:
→ India becomes associate member of IEA.
 2020:
→ Current central govt, imposes Power Sector reforms as one condition on State govt. for allowing borrowings by
States.
 2021:
→ India and IEA signed Strategic Partnership Agreement.
→ India Energy Outlook 2021 report by IEA
→ IRENA releases World Energy Transitions Outlook report.
 Finding: Covid-19 crisis offers opportunity for countries to decouple their economies from fossil fuels and
accelerate towards renewable energy sources.
→ Union Cabinet approves RDSS.
→ Govt. publishes draft Electricity (Rights of Consumers) Amendment Rules, 2021 to amend Electricity (Rights of
Consumer) Rules, 2020.
→ For solar energy sector, Cabinet approves one PLI Scheme, namely, ‘National Programme on High Efficiency Solar PV
Modules’, with outlay of Rs. 4,500 crore.
→ NITI Aayog launches Geospatial Energy Map of India.
→ India offers some blocks of oil and gas in bid of Open Acreage Licensing Policy (OALP). [To bring more area under
exploration, thereby leading to increase in domestic production, reduction of imports].
→ IEA has invited India (world’s 3rd-largest energy consumer) to become its full-time member.
 Implication: If accepted by India, India will be required to raise its strategic oil reserves to 90 days requirement.
India’s current strategic oil reserves is about 10 days requirement.
 2022:
→ IEA releases 2022 Electricity Market Report.
→ CCEA approves scheme on Green Energy Corridor (GEC) Phase II for Intra -State Transmission System
(InSTS).
→ CCEA approves equity infusion of X crore in IREDA.
→ Ministry of Power launches Powerthon-2022 under RDSS.
→ According to IRENA, India needs firm policy on managing waste that results from used solar panels or from
manufacturing process.
→ REC Limited and PFC Ltd. will release 1st tranche of funds to some States including UP, Assam, Meghalaya. Funds will
be disbursed in form of ad hoc 10% of grant from central government, while rest of disbursal will depend on discoms
concerned fulfilling conditions under RDSS scheme.
→ NITI Aayog launches State Energy and Climate Index (SECI).
Page 696 of 719
 → Global Wind Energy Council (GWEC) releases Global Wind Report 2022.
→ India’s 1st portable solar rooftop system installed in Gandhinagar, Gujarat. [It is designed to be highly cost-effective,
requires low maintenance, and can be installed by one single person].
→ Palli village in Jammu becomes India’s 1st carbon-neutral panchayat, fully powered by solar energy and with all its
records digitised and saturation of benefits of all Central schemes.
→ WEF releases annual country benchmarking report - Fostering Effective Energy Transition 2022.
→ REN21 publishes Renewables 2022 Global Status Report
→ Ministry of Petroleum and Natural Gas launches Open Acreage Licensing Programme Bid Round-VIII.
→ DISCOMs will get support under RDSS scheme so as to make DISCOM financially sustainable, reduce AT&C loss (to
12-15% by 2024-25) and reduce Cost-revenue gap (to 0 by 2024-25).
→ Power Ministry plans to commission one socioeconomic survey to measure effectiveness of its schemes aimed at
universal access to electricity.
→ At launch of TERI’s one discussion paper titled “Roadmap to India’s 2030 Decarbonization Target”, Union Power and
New & Renewable Energy Minister RK Singh says India's electricity generation capacity will reach 820GW by 2030,
including over 500GW from non-fossil fuel sources.
→ GOI tables Electricity (Amendment) Bill, 2022 in Lok Sabha and then referred it to parliamentary standing committee
on energy for wider consultation.
→ Union Power Ministry [by Power System Operation Corporation Limited (POSOCO)] bars 13 States, including
Karnataka, from buying or selling electricity from spot market for not clearing dues.
→ India’s 1st Geothermal Power Project: State run ONGC starts drilling to discover energy from bowels of earth in Ladakh
– area which lies on Himalayan geothermal belt. It has long been reported that Puga Valley in Ladakh’s SE part may
have significant geothermal energy potential and now assessments have begun for project’s viability, to reduce
dependence of Ladakh on diesel-run generators.
→ According to one report released by Global Wind Energy Council (GWEC) and MEC+, one consulting firm that
specialises in renewable energy, annual installation of new wind power projects in India will peak by 2024 and likely
decline thereafter and says after 2024, fresh projects are likely to be wind-solar hybrids.
→ PM Modi calls for “Energy Atmanirbharta” by 2040.
→ IRENA, and some companies (including Tata Steel Ltd.) launch global Alliance for Industry Decarbonization. This
alliance’s 1st meeting will be held at COP27 in Sharm El Sheikh, Egypt in 2022.
→ IRENA releases “Bioenergy for energy transition: Ensuring sustainability and overcoming barriers” report with aim to
provide status of sustainable bioenergy development.
→ One report by advisory body Central Electricity Authority (CEA) says that India may need additional up to 28GW of
coal-fired power generation capacity by 2032 apart from 25GW thermal projects that are under construction. CEA
has also put up “Draft National Electricity Plan (Vol-I Generation)” for feedback of stakeholders. [As per Electricity
Act, 2003, CEA has to prepare National Electricity Plan once in 5 years].
→ IEA releases “World Energy Employment” report. This report says that in 2019, energy sector and other related fields
saw employment of 65 million people, which accounted for 2% of formal employment worldwide. And, also in 2019,
50% of energy workforce was employed in developing clean energy technologies and that, by 2021, employment in
clean energy sector exceeded that and constituted nearly 2/3rd of workers engaged in building new projects.
→ In order to move towards “One Nation, One Grid, One frequency, One Price” framework, Ministry of Power proposes
one centralized power model using MBED. Thus, fresh tussle between Centre and States is brewing over MBED
mechanism that envisages centralised scheduling for dispatching entire annual electricity consumption of around
1,400 billion units.
→ India (Union Minister Dr. Jitendra Singh and other delegates) will visit to USA to participate in Global Clean Energy
Action Forum (GCEAF) at Pittsburg, USA. [GCEAF is 1st of its kind of meeting of over 30 countries to promote policies
and programmes that advance clean energy technology].
→ Union Cabinet clears Rs. 19,500-crore scheme to incentivise manufacturing of domestic solar cell modules to reduce
solar industry’s reliance on China-made panels. [This is follow-up to Rs. 4,500-crore tranche that was cleared in 2020].
This is under ‘National Programme on High Efficiency Solar PV Modules [2021]’.
→ Department of Public Enterprises, under Ministry of Finance accords REC Ltd. with status of ‘Maharatna’ CPSE, thus
giving REC greater operational and financial autonomy.
→ IEA, IRENA and UN Climate Change High-Level Champions releases report - “Breakthrough Agenda Report 2022”.
→ GOI puts up as many as 42 oil and gas blocks for exploration and development through international competitive
bidding under HELP auction.
→ Russia-Ukraine conflict pushing world towards clean energy: According to the World Energy Outlook 2022, released
in 2022, Russia’s invasion of Ukraine is a historic turning point in global energy markets, providing an unprecedented
incentive to accelerate the transition to clean energy sources of fuel.
About:
 What:
→ production of energy and sale of energy, including - fuel extraction, manufacturing, refining, distribution.
 Hydrocarbon:

Page 697 of 719

 → Initiative:
 Hydrocarbon Exploration and Licensing Policy (HELP) [2016].
 Renewable Energy:
→ Renewable Energy is included in Priority Sector Lending (PSL).
→ India:
 capacity is 5th largest in world. capacity is growing at fastest speed among all major countries. current capacity is
about 1/3rd of our total capacity. annual renewable energy capacity addition > annual coal based thermal power
energy capacity addition. capacity is increasing. capacity target is 175 GW by 2022. According to TERI, in India,
shares of renewables of Wind, Solar, Small Hydro, Biomass are increasing year after year.
 emerges as world leader in Energy Transition, how:
• India had one of fastest rates of growth of Renewable Energy capacity in world. India had pledged in
2015 UN Climate Change Conference, in Paris, that by 2030, 40% of India’s power generation
capacity will be from non-fossil fuel sources. India set target of 450 GW of Renewable Energy
capacity by 2030. Deen Dayal Upadhyay Gram Jyoti Yojana (DDUGJY). Saubhagya Scheme [2017]. By 2021,
India has already reached 200 GW of renewable energy capacity. India will also emerge as leader in Green
Hydrogen, Green Ammonia.
→ Implementation:
 Ministry of New and Renewable Energy.
→ Bioenergy:
 What:
• Bioenergy is one form of renewable energy generated when we burn biomass fuel e.g. biofuels for
transportation. Biomass fuels come from organic material such as harvest residues, pu rpose-
grown crops, organic waste from our homes, businesses, farms. When we use plants and other
organic material to generate energy we call it bioenergy.
 Status:
• Bioenergy currently accounts for 2/3 rd of all renewable energy consumption worldwide.
 Initiative:
• In 2022, IRENA released “Bioenergy for energy transition: Ensuring sustainability and overcoming barriers”
report with aim to provide status of sustainable bioenergy development.
 Benefits:
• Modern applications of bioenergy can provide for electricity generation, heating in buildings, transport
fuels, industrial uses. They can also play major role in energy transition, especially in sectors with limited
renewable alternatives.
 Issue:
• Bioenergy can incur -ve environmental, social and economic impacts such as biodiversity loss, food
insecurity, deforestation.
 Way Forward:
• Countries need strong policy frameworks tailored to local contexts. Policy measures are also urgently
required to overcome various political, financial, technical, supply chain-related barriers. Cross-sector
coordination for bioenergy. Integration of bioenergy policy-making with SDGs.
→ Solar Energy:
 Status:
• From < 10 MW in 2010, India has added significant solar PV capacity over past decade, achieving
over 50 GW by 2022. By 2030, India is targeting about 500 GW of renewable energy deployment,
out of which 280 GW is expected from solar PV.
 Rooftop solar scheme:
• Objective:
 Achieve installation of Rooftop Solars. To promote grid-connected solar panels rooftop among
residential, community, institutional, industrial, commercial establishments. To mitigate dependence
on fossil fuel based electricity generation. Encourage environment-friendly solar electricity generation.
Encourage investment in solar energy sector by private sector, State government, individuals.
Encourage solar power supply from rooftop to grid.
• Feature:
 MNRE provides subsidy in solar panel. implemented by Ministry of New and Renewable Energy.
implemented in States by distribution companies (DISCOMs).
• Benefits:
 Alternative source of electricity to grid. It reduces dependence on fossil-fuel generated electricity.
Electricity to not yet connected to grid (remote locations, difficult terrains).
 India’s potential for rooftop solar:
• MNRE estimates market potential for rooftop solar at about 124 GW.
 Challenges:

Page 698 of 719

 •Variability in supply [because of variations in efficiency of solar panels and sunlight]. Additional
cost for storage facilities. If roof is used for solar generation, then it cannot be used for anything
else. Tariffs charged to residential customers.
 Challenges in solar PV manufacturing in India:
• Dependency on Imports: India’s current solar module manufacturing capacity is limited to 15 GW
per year. India has no manufacturing capacity for solar wafers and polysilicon ingots, and currently
imports 100% of silicon wafers and around 80% of solar cells.
• Older technology: Indian manufacturers are still dependent on older Al -BSF technology (Aluminum
Back Surface Field Solar Cells) (low efficiencies of 18 -19%), whereas worldwide PV cell efficiency
is greater than 21%.
• India is more of assembly hub than manufacturing one: Several raw materials such as silicon
wafers, metallic pastes of silver and aluminium to form electrical contacts too, are almost 100%
imported. India is dependent on China for Silicon wafers (most expensive raw material). More than
90% of world’s solar wafer manufacturing currently happens in China.
• Poor investment in research: India has hardly invested in creating centres for try and test solar
technologies in cost-effective manner. E.g., IMEC Belgium or Holst Centre in Netherlands.
• Challenges at WTO: India lost case in WTO (challenged by US PV manufacturers) over India’s import
duty.
 Initiatives for solar PV manufacturing:
• India has implemented 40% duty on import of modules and 25% duty on import of cells. PLI scheme
to support manufacturing capex. Government has made it mandatory to procure modules only
from approved list of manufacturers (ALMM) (till now only India -based manufacturers have been
approved) for projects that are contracted to State / central government grids.
 What should India do for solar PV manufacturing?
• Technology tie-up with global manufacturers: India will have to work on technology tie -ups to
make right grade of silicon for solar cell manufacturing. Move towards Atmanirbhar
manufacturing: India should move up value chain by making components locally that could drive
price and quality of both cells and modules. PV panel Manufacturing parks: India needs to create
industry-like centres to work on specific technology domains with clear roadmaps and deliverables
for short and long term. Strong industry-academia collaboration in innovative manner to start
developing home-grown technologies.
→ Wind Energy:
 Status [India]:
• Gujarat - highest Wind Energy potential, followed by Rajasthan, Maharashtra. India has 4 th highest
wind installed capacity in world, with total installed capacity of 39.25 GW. Tamil Nadu – tops,
followed by Gujarat, Maharashtra.
 Challenges [India]:
• Inconsistent policy environments focused on short -term political aims. Badly designed markets
which do not enable bankable renewable energy projects. Infrastructure and transmission
bottlenecks. Lack of adequate industrial and trade policies related to renewable technologies.
Hostile political or misinformation campaigns.
• Wind industry installations have been slowing down in India since 2017. Only 1.45 GW of wind
projects were installed in 2021 with many delayed due to COVID -19 and supply chain-related
disruptions.
 Scope [India]:
• More than 1.4 GW of wind installed in 2021. Ministry of New and Renewable Energy (MNRE) sets
target of installing 5 GW of offshore capacity by 2022 and 30 GW by 2030. But India is yet to
develop its offshore wind energy facility. India can generate 127 GW of offshore wind energy with
its 7,600 km of coastline.
 Way Forward:
• India needs transparent, neutral, cohesive and credible industry group that represents interests
of all wind sector stakeholders, working according to best international practices of advocacy.
GWEC India (Global Wind Energy Council) is one step forward in this direction. India’s federal
government structure lends itself to large differences in regulatory environments, customer
preferences, development timelines and local/State priorities. Thus, GWEC India will consolidate
wind industry around one common strategy. Governments should tackle issues such as planning barriers
and grid connection challenges.
• To sustain and increase growth in wind-based generation capacity, policymakers should streamline
procedures to grant permits, including land allocation and grid connection projects. Workforce planning for
large-scale renewables deployment should be early policy priority and investment in grids must increase.
Annual transition-related investment in energy system must increase. need for greater public-private co-

Page 699 of 719

 operation to confront new geopolitics of wind supply chain. stronger international regulatory framework is
needed to address increased competition for commodities and critical minerals.
→ Deen Dayal Upadhyay Gram Jyoti Yojana (DDUGJY) [2015].
→ Saubhagya Scheme [2017].
→ Green Energy Corridor (GEC).
→ India’s efforts towards renewable:
 India announced target of 500 GW of renewable energy by 2030 through sources such as solar photovoltaic (PV)
energy, wind, hydropower. Currently, projects worth almost USD 197 billion are underway in India. India
extended its solar production programme, which provides incentives to domestic and international companies
for setting up battery manufacturing plants. In 2021, after India increased its cap on solar PV installations under
its net metering scheme, India’s rooftop PV market hit record high. Performance Linked Incentive (PLI) Scheme.
Green Open Access Rules (which facilitates generation, purchase and consumption of green energy including
that produced by waste-to-energy plants). Green Term Ahead and Day-Ahead Market. ...
 Geothermal power:
→ What:
 Electrical power generated from geothermal energy. Technologies in use include dry steam power stations, flash
steam power stations, binary cycle power stations. Geothermal electricity generation is currently used in 26
countries, while geothermal heating is in use in 70 countries.
→ Feature:
 Geothermal power is considered to be sustainable, renewable source of energy because heat extraction is small
compared with Earth's heat content.
→ How:
 Geothermal power plants use steam to produce electricity or heat. Steam comes from reservoirs of
hot water found below earth surface. Steam rotates turbine that activates generator which produces
electricity.
→ Status:
 Indonesia has estimated potential of 29,000 megawatts (MW) of geothermal energy resources, largest
in world.
 Top 5 countries in terms of geothermal power generation are USA, Philippines, Indonesia, Mexico, New Zealand.
→ Significance:
 GHG emissions of geothermal electric stations average 45 grams of carbon dioxide per kilowatt-hour of
electricity, or less than 5% of that of conventional coal-fired plants.
 As one source of renewable energy for both power and heating, geothermal has potential to meet 3-5% of global
demand by 2050. With economic incentives, it is estimated that by 2100 it will be possible to meet 10% of global
demand.
→ India:
 Though India has been one of earliest countries to begin geothermal projects way back in 1970s, but at present,
there are no operational geothermal plants in India. Indian geothermal provinces have potential to produce
around 10,600 MW of power.
 As per Geological Survey of India, there are around 340 geothermal hot springs in India - Chummathang (Ladakh),
Cambay (Gujarat), Khammam (Telangana), Tattapani (Chattisgarh), Ratnagiri (MH).
 Power Sector Reforms in India:
→ Revamped Distribution Sector Scheme (RDSS) [2021].
→ Significance:
 India’s investment in renewable energy from start has brought down costs. Good environmental policy. Good
economy. Economists say there is strong link between poverty eradication and spread of electricity use (SDG7).
 Energy security:
→ What:
 It is association between national security and availability of natural resources for energy consumption. Access
to (relatively) cheap energy has become essential to functioning of modern economies. However, uneven
distribution of energy supplies among countries has led to significant vulnerabilities. International energy
relations have contributed to globalization of world leading to energy security and energy vulnerability at same
time. IEA defines energy security as uninterrupted availability of energy sources at affordable price.
→ PM Modi called for “Energy Atmanirbharta” by 2040. What does India need to do to achieve energy security by
2040? Some suggestions according to one author in news - Vikram S Mehta - are:
 Focus on self-reliance and not self-sufficiency because self-sufficiency may not be feasible and economical.
 Access to fossil fuels because transition to green energy system is lengthy, time taking and costly process. GAIL
is investing in development of national gas pipeline grid. India must expand its Strategic Petroleum Reserves to
cover at least 30 days of consumption.
 Access to critical materials needed for green energy. Eg., minerals / components (copper, cobalt, lithium,
semiconductor chips etc.) required to build EVs, solar panels, wind turbines, batteries.

Page 700 of 719

  Offer green incentives to encourage private participation. Eg., one PLI offers benefits for investment in green
energy.
 Demand management: Energy usage norms must be standardised and tightened. Legislation should be properly
enacted to ensure compliance.
 Retraining and upskilling esp. in upcoming green energy sector.
 Energy diplomacy: Success in navigating economic and geopolitical uncertainties will depend greatly on skilful
diplomacy.
 Holistic governance: Institutions should be created to facilitate integrated energy planning and implementation.
 Energy Transition:
→ Need:
 Organisation of Petroleum-Exporting Countries (OPEC) estimates that world oil demand will rise. Therefore, to
counter rising prices and ensure sustainability, India needs transition strategy away from fossil fuels. India will
depend on imports for about 85% of oil and 1/2 its fuel needs. Cooking fuel might be India’s new vulnerability
as consumption has risen. Therefore, India must search options like electrical, photo voltaic, bio-fuel, biogas to
exchange LPG.
→ How India emerged as world leader in Energy Transition?
 India had one of fastest rates of growth of Renewable Energy capacity in world. India had pledged in 2015 Paris
COP-21 that by 2030, 40% of its power generation capacity will be from non-fossil fuel sources. India has set
target of 450 GW of Renewable Energy capacity by 2030. India had achieved universal access by connecting
every village under Deen Dayal Upadhyay Gram Jyoti Yojana Scheme. India had achieved universal access by
connecting every household under Saubhagya Scheme. India will also emerge as leader in Green Hydrogen,
Green Ammonia.
 Issue:
→ Issues with DISCOMs: Political interference, no periodic revision of tariff, delay in subsidy allotment by State
government, issues with recovery of dues (esp. from rural areas).
→ Issue of Generation Companies (Gencos): Delayed payment by DISCOMs leads to debt trap as they have to
borrow money to keep up their operation.
 Initiatives:
→ Pradhan Mantri Sahaj Bijli Har Ghar Yojana / Saubhagya. Integrated Power Development Scheme (IPDS). Deen
Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY). GARV App / Grameen Vidyutikaran App. Ujjwal DISCOM
Assurance Yojana / UDAY scheme / Ujjwal scheme. “4 Es” in revised Tariff Policy: It means Electricity for all,
Efficiency to ensure affordable tariffs, Environment for sustainable future, East of doing business.
→ Initiatives for clean energy:
 Asia Energy Transition Initiative (AETI): One initiative of Japan to achieve both sustainable growth and
carbon neutrality in Asia, where energy demand will continue to grow, various and pragmatic energy
transitions, that reflect different circumstances of each country, and utilise all energy sources and all
technologies, are essential. It includes variety of support for realising energy transitions in Asia. Under
this, Japan will provide financial support to India for energy transition.
 Sydney Energy Forum (Australia and IEA): It aims to secure clean energy supply chain for Indo-pacific. At
this forum, India declared that it has achieved clean energy targets 9 years ahead of schedule (installed
162 GW of renewable energy to date).
 Internation Solar Alliance, OSOWOG, National Wind-Solar Hybrid Policy [2018], National Hydrogen
Mission, Biogas Power Generation (Off-grid) and Thermal application Programme (BPGTP).
 Status:
→ Global energy crisis 2022:
 According to World Energy Outlook 2022 released in 2022 by IEA, Russia’s invasion of Ukraine is a historic
turning point in global energy markets, providing an unprecedented incentive to accelerate the transition
to clean energy sources of fuel.
 Economic sanctions on oil and coal imports from Russia and its cutback on the natural gas supply have
caused disruption in the world’s energy supply. Russia is the world’s largest exporter of fossil fuels.
 According to World Energy Outlook 2022 released in 2022 by IEA, the supply of natural gas is hit hard in
Europe.
 According to World Energy Outlook 2022 released in 2022 by IEA, electricity and heat demand in the
winter months shoot up in the Northern Hemisphere, so it is likely to be a challenging time for the EU
for the next couple of years.
 According to World Energy Outlook 2022 released in 2022 by IEA, due to geopolitical tension, the era of
rapid growth in gas demand draws to a close and its role as a transition fuel has been reduced as a result.
[Russia supplied 40% of Europe’s natural gas, mostly via pipelines].
 The global energy crisis has sparked desperate attempts from governments around world to promote
energy security. Governments around world either tried to go for short-term responses like boosting
fossil fuel investment and subsidies or accelerating clean energy transitions with programmes such as
the REPowerEU and legislations like the US’s Inflation Reduction Act, 2022.
Page 701 of 719
 According to World Energy Outlook 2022 released in 2022 by IEA, Russia’s share of internationally traded
natural gas may drop from 30% in 2021 to 15% in 2030. If countries meet their pledges, Russia’s natural
gas trade will fall to 10%. This is because China already has enough contracts for liquified natural gas
(LNG) and, therefore, will not be able to accommodate a pipeline from Russia.
 According to IEA’s global Stated Policies Scenario, that projects the trajectory of current policies, natural
gas demand is expected to be 750 billion cubic metres lower than it is today in 2022 by 2050, driven by
a switch from natural gas to renewables.
 According to World Energy Outlook 2022 released in 2022 by IEA, global natural gas demand may
increase by 5% by 2030 and plateau without much change by 2050 because developing countries in South
and SE Asia are no longer enthusiastic about gas as a transition fuel .
 While coal demand may peak soon, oil demand may peak in the mid-2030s before dropping marginally.
 Oil currently comprises 80% of the global energy mix, but it may drop to 75% by 2030 and around 60%
by 2050.
 According to IEA’s Announced Pledges Scenario, the projections based on IEA member countries’ climate
pledges, the demand for fossil fuels is expected to decline by 2030.
 According to World Energy Outlook 2022 released in 2022 by IEA, natural gas accounts for 50% of the
rise in electricity generation costs worldwide and prices may remain high until the late 2020s. The costs
of renewable electricity generation were marginal, demonstrating the potential of energy transitions as
a solution.
 According to World Energy Outlook 2022 released in 2022 by IEA, high energy prices are causing a huge
transfer of wealth from consumers to producers, back to the levels seen in 2014 for oil, but entirely
unprecedented for natural gas.
 Success story:
→ Life has changed in Sarkhipara, in Tripura’s Khowai district after one micro-grid solar plant was installed in
2021. This was game changer in not only providing electricity but also solar irrigation projects.
Note:
 International Energy Agency (IEA) [1974]:
→ What:
 IEA is a Paris-based autonomous intergovernmental organisation, established in 1974, that provides
policy recommendations, analysis and data on the entire global energy sector, with a recent focus on
curbing carbon emissions and reaching global climate targets, including the Paris Agreement.
 Autonomous Intergovernmental organization. Headquarters / Secretariat - Paris, France. IEA aims to
ensure reliable, affordable and clean energy for its member countries and beyond.
→ Origin:
 IEA was set up under framework of OECD after 1970s oil crisis, as response to oil supply disruptions in
1970s oil crisis.
→ 4 Focus:
 energy security; economic development; environmental awareness; worldwide engagement.
→ Mandate / role / function:
 Help its members respond to major oil supply disruptions; Global key energy trends; energy policy; Global
cooperation on energy technology.
→ Member:
 Only OECD member can become member of IEA. 31 members. 11 association countries.
 Criteria:
• Candidate country must have crude oil and / or product reserves equivalent to 90 days of previous year’s
net imports, to which government has immediate access and could be used to address disruptions to global
oil supply; Demand restraint programme to reduce national oil consumption by up to 10%; Legislation and
organisation to operate Co-ordinated Emergency Response Measures (CERM) on national basis; Legislation
and measures to ensure that all oil companies under its jurisdiction report information; Measures in place
to ensure capability of contributing its share of IEA collective action.
→ Report:
 World Energy Outlook. Electricity Market Report. Global Energy & CO2 Status Report. World Energy Statistics.
World Energy Balances. Energy Technology Perspectives.
→ India:
 India is not member of IEA, but associate member. world’s 3rd-largest energy consumer.
→ Significance:
 IEA countries represent 75% of global energy demand.
 World Energy Outlook [1998]:
→ The WEO is the energy world’s most authoritative source of analysis and projections. This flagship publication of the
IEA has appeared every year since 1998. Its objective data and dispassionate analysis provide critical insights into
global energy supply and demand in different scenarios and the implications for energy security, climate targets and

Page 702 of 719

 economic development. It presents detailed projections of energy demand, production, trade and investment, fuel
by fuel and region by region.
→ World Energy Outlook 2022:
 It was released in 2022 by IEA.
 With the world in the midst of the 1st global energy crisis – triggered by Russia's invasion of Ukraine – the World
Energy Outlook 2022 provides indispensable analysis and insights on the implications of this profound and
ongoing shock to energy systems across the globe.
 REN21 [2004]:
→ What:
 Renewable Energy Policy Network for 21st Century. REN21 is only global renewable energy community of actors
from science, governments, NGOs and industry which provide up-to-date and peer-reviewed facts, figures and
analysis of global developments in technology, policies and markets; and also only org. that keep track of global
development in renewable sector. One think tank and multistakeholder governance group which is focused on
renewable energy policy. It was created in 2004 as outcome of International Conference for Renewable Energy,
Bonn 2004. REN21 Secretariat is based in France.
→ Goal:
 Enable decision-makers to make shift to renewable energy. To facilitate policy development, knowledge
exchange, and joint action towards rapid global transition to renewable energy.
→ Function:
 REN21 brings together governments, non-governmental organisations, research and academic institutions,
international organisations, and industry to learn from one another and advance adoption of renewable energy.
→ Renewables Global Status Report (GSR):
 One report published by REN21. It is world’s only crowd-sourced report on renewable energy. It covers policies,
markets, etc, while telling most up-to-date global story on renewable energy.
 Renewables 2022 Global Status Report:
• On India: India ranks 3rd in renewable energy installations in 2021, after China, Russia. India ranks 4th in
total solar installations in 2021 – overtaking Germany for 1st time.
• On world: Overall countries added around 3,146 GW of total installed renewable power capacity in 2021 –
rise of 11% from 2020.
• On Target of renewables: Despite rise in installed capacity, share of renewables in global energy use
stagnated in 2021. Renewable energy capacities achieved so far come nowhere close to targets required to
keep world on track to reach net-zero emissions by 2050.
• On impact of Covid pandemic: Despite impacts of pandemic, renewables saw year of record growth in both
investment and installation.
• On impact of Ukraine crisis: 2022 Invasion of Ukraine added to energy crisis. Governments, however,
responded by increasing fossil fuel production and subsidies. This has caused record surge in CO2 emissions
(up by 6%, adding more than 2 billion tonnes).
 Power Finance Corporation Ltd. / PFC Ltd. [1986]:
→ One Indian central PSU under ownership of Ministry of Power. It is financial backbone of Indian Power
Sector. PFC is India's largest NBFC and also India's largest infrastructure finance PSU. It is one Maharatna
PSU. It is one Indian financial institution.
 REC Limited [1969]:
→ It was formerly Rural Electrification Corporation Limited. It is one subsidiary of PFC Ltd. which in turn is
under ownership of Ministry of Power. It finances and promotes power projects across India. REC is one
PSU and it provides loans to Central / State Sector Power Utilities in India, State Electricity Boards, Rural
Electric Cooperatives, NGOs, Private Power Developers. It is among state -run lenders. REC is one NBFC
focusing on power sector financing and development across India. It is one power sector-focussed NBFC.
REC has played key role in success of flagship schemes such as DDUGJY, SAUBHAGYA and is currently nodal
agency for RDSS.
In 2022, Department of Public Enterprises, under Ministry of Finance accorded REC Ltd. with status of
‘Maharatna’ CPSE, thus giving REC greater operational and financial autonomy.
 Electricity - Concurrent List in 7th Schedule. Thus, central government has authority and power to make laws on it.
 Indian Renewable Energy Development Agency Limited (IREDA) [1987]:
→ What:
 Public Limited Government Company. established as NBFI. under Ministry of New and Renewable Energy
(MNRE). Mini Ratna (Category – I) Government of India Enterprise
→ Objective:
 To give financial support to projects, schemes for generating electricity through new and renewable sources,
conserving energy through energy efficiency. To maintain its position as leading organization to provide efficient
and effective financing in renewable energy and energy efficiency / conservation projects. To increase IREDA`s
share in renewable energy sector by way of innovative financing. Improvement in efficiency of services provided

Page 703 of 719

 to customers through continual improvement of systems, processes, resources. To strive to be competitive
institution through customer satisfaction.
→ Function:
 financial assistance for setting up projects relating to new and renewable sources of energy, energy efficiency/
conservation
→ Motto:
 Energy For Ever
 International Renewable Energy Agency (IRENA) [2009]:
→ What:
 Intergovernmental organization mandated to facilitate cooperation, advance knowledge, and promote
adoption and sustainable use of renewable energy. It is 1 st international organisation to focus
exclusively on renewable energy, addressing needs in both industrialised and developing countries. It
is headquartered in Masdar City, Abu Dhabi, UAE. IRENA is one official UN observer.
 India is one founding member of IRENA.
 It supports countries in their transition to sustainable energy future. IRENA also coordinates Small
Island Developing States (SIDS) Lighthouses Initiative for supporting energy transition efforts of Small
Island countries.
 Green Ammonia:
→ Ammonia is pungent gas widely used to make agricultural fertilisers. Green ammonia production is where
process of making ammonia is 100% renewable and carbon -free. One way of making green ammonia is by
using hydrogen from water electrolysis and nitrogen separated from air. Then, they are fed into Haber
process (Haber-Bosch), all powered by sustainable electricity. In Haber process, hydrogen and nitrogen are
reacted together at high temperatures and pressures to produce ammonia, NH3.
 Hydrocarbon Exploration and Licensing Policy (HELP) [2016]:
→ What:
 HELP is one exploration and production policy of GOI in hydrocarbon sector, adopted in 2016. In line with vision
of reducing hydrocarbon import dependency by 10% by 2022, HELP was launched with clear objective of
boosting production of oil & gas in Indian sedimentary basin.
→ Feature:
 Revenue Sharing Contract. Single Licence for exploration and production of conventional as well as
unconventional Hydrocarbon resources. Marketing & pricing freedom. No oil cess. Year-round bidding. Easy to
administer revenue sharing model. marketing and pricing freedom for crude oil and natural gas produced.
Exploration blocks shall be awarded on continuous basis through e-bidding in transparent manner. Revenue
sharing model [instead of Profit-sharing]. Unified license for all types of hydrocarbons. Freedom to carve out
acreages of choice under OALP bid rounds. Full marketing and pricing freedom of gas. Uniform license for
exploration and production of all forms of hydrocarbon. Open Acreage Policy / Open Acreage Licensing Policy
(OALP) [2017].
 Open Acreage Licensing Policy (OALP) [2017]:
→ What:
 It is about choice of blocks for investors. launched under Hydrocarbon Exploration and Licensing Policy (HELP).
→ Feature:
 Under OALP, companies are allowed to carve out areas they want to explore oil and gas in. Areas sought are
then offered for bidding.
 OALP provides uniform licences for exploration and production of all forms of hydrocarbons, thereby enabling
contractors to explore conventional, unconventional oil and gas resources.
 Fields are offered under revenue-sharing model.
 Offers pricing freedom for crude oil, natural gas produced.
 E&P companies (Exploration & Production) will be allowed to put in offers for blocks at any time by submitting
initial Expression of Interest (EOI) indicating area in terms of grids which they wish to take up. Modalities for
operationalization of OALP will be notified separately.
 OALP along with National Data Repository (NDR) was launched in 2017 as key driver to accelerate Exploration
and Production (E&P) activities in India. Under OALP, companies are given freedom to carve out areas they want
to explore oil and gas. Areas sought are then put on auction.
 Under HELP, Open Acreage Licensing (OALP) mechanism has been launched which allows investors to carve out
blocks of their choice by assessing E&P data available at National Data Repository (NDR) & by submitting
Expression of Interest (EoI). These blocks would be subsequently offered through formal bidding process. OALP
would be manifested through National Data Repository (NDR).
 Achievement: Successful roll-out of HELP regime, followed by OALP Bid Rounds, has led to increase in exploration
acreages in India.
 National Data Repository (NDR):

Page 704 of 719

 → One government-sponsored data bank for future exploration and development. E.g. Seismic Data, Well &
Log Data, Spatial Data, other data like Drilling, Reservoir, Production, Geological, Gravity & Magnetic etc.
 Geospatial Energy Map of India [2021]:
→ What:
 comprehensive Geographic Information System (GIS) Energy Map of India. It shows spatial and non-spatial data
of conventional power plants (thermal, hydro), renewable energy power plants, coal mines, petroleum
refineries, solar energy resource potential, wind energy resource potential, other energy related assets of India.
developed by NITI Aayog and ISRO. GIS map provides holistic picture of all energy resources of India.
→ Aim:
 to provide inputs for formulating and evaluating policies. assisting Energy Ministries and Departments in policy
formulation. encourage private sector participation in energy sector.
→ Function:
 identify and locate all primary and secondary sources of energy. their transportation / transmission networks.
→ Features:
 unique effort aimed at integrating energy data scattered across multiple organizations and to present it in
consolidated, visually appealing graphical manner. It uses latest advancements in web-GIS technology and open-
source software to make it interactive and user friendly. It will be useful in planning and making investment
decisions. It will also aid in disaster management using available energy assets.
→ Significance:
 GIS-mapping of energy assets will ensure real-time and integrated planning of energy sector of India [India has
large geographical distribution and interdependence]. advantageous to all concerned stakeholders. accelerating
policy-making process.
 Geographic Information System (GIS):
→ type of database containing geographic data (phenomena for which location is relevant), combined with software
tools for managing, analyzing, and visualizing those data.
 Global Wind Energy Council (GWEC) [2005]:
→ What:
 international trade association for wind power industry to provide credible and representative forum for entire
wind energy sector at international level. member-based organisation that represents entire wind energy sector.
Members of GWEC represent over 1,500 companies, organisations and institutions in more than 80 countries
(including India), including manufacturers, developers, component suppliers, research institutes, national wind
and renewables associations, electricity providers, finance and insurance companies.
→ Mission:
 To ensure that wind power establishes itself as answer to today’s energy challenges, providing substantial
environmental and economic benefits.
→ Mandate:
 communicate benefits of wind power – to national governments, policy makers and international institutions.
provide authoritative research and analysis on wind power industry in more than 80 countries around world.
work with governments to give them transparent information about benefits and potential of wind power,
enabling them to make informed decisions about national energy policies. support collaboration between policy
makers in different countries to help them share best practices and experiences in adding clean power to their
energy mix.
→ Global Wind Report:
 released by Global Wind Energy Council (GWEC).
 2022 Global Wind Report:
• Wind energy installations every year across world must quadruple from 94 GW installed in 2021 within this
decade to meet global climate targets. Without necessary amplification, restricting global warming over
pre-industrial levels to 1.5 degrees Celsius — target set by Paris Agreement — and achieving Net Zero
emissions by 2050 may become difficult. New offshore installations in 2022 are likely to decline to 2019 /
2020 levels, primarily due to reduction of installations in China. Market growth is expected to regain
momentum from 2023, eventually passing 30GW-mark in 2026. Offshore wind energy generation increases
return on investment, along with reducing greenhouse gas emissions.
→ GWEC India:
 One single advocacy and research body representing entire value chain of India’s wind industry, from
Independent Service Providers (IPP) to Original Equipment Manufacturer (OEM) to end-users to service-
providers – will work closely with central and State governments to improve enabling environment for sector
growth, creating conditions for inward investment. It will give government of all levels efficient and transparent
channel to consult with industry, and connect policymakers and public expectations with market reality. GWEC
India will consolidate wind industry around common strategy which focuses resources on those high-potential
markets where it can build volume and scale expeditiously.
 Electricity Market Report:

Page 705 of 719

 → by IEA. bi-annual.
→ 2022 Electricity Market Report:
 Highlights:
• Nations are turning to fossil fuels to meet increased electricity demand after Covid-19 lockdown restrictions
lifted. Global electricity demand rose 6% in 2021 (steepest year-on-year increase since financial crash of
2008). Global energy intensity fell 1.9% year-on-year. Electricity generation from renewables up by 6% in
2021. Electricity generation from coal up by 9% in 2021, led by markets – China, India etc. Coal served > 1/2
of increased in electricity demand in 2021. 2% increase in gas-fired generation. 7% increase in 2021 in
emissions from power sector. After 2 years of decline, this means that emissions from power sector are now
at record high. Increase in wholesale gas and electricity prices, globally to high levels. Volatile coal prices.
 Concerns:
• IEA is voicing concerns that despite growing net-zero movement, nations are still failing to decouple
increased electricity demands from increased emissions. IEA is forecasting that power sector emissions will
likely remain around same level for next few years.
 India Energy Outlook 2021 report:
→ India is world’s 2nd-largest net oil importer, after China. India’s growing energy / oil needs would make India
depend on fossil fuel imports, because India’s domestic oil and gas production has been stagnant for years.
India’s rising oil demand could double oil import bills by 2030. India’s energy demand growth would be
biggest in next 2 decades. India would overtake European Union (EU) as world’s 3rd -largest energy consumer
by 2030. India’s energy consumption is expected to be doubled by 2030.
 Fostering Effective Energy Transition:
→ What:
 released by WEF. annual country benchmarking report.
→ 2022 Fostering Effective Energy Transition:
 What:
• WEF’s special edition report on global energy transition. It builds on trends from Energy Transition Index
(WEF) to provide perspective on current challenges and recommendations on how to navigate transition
through turbulent macroeconomic and geopolitical environment.
 Findings:
• Energy transition is not matching with growing urgency for change. Energy affordability, energy security,
and sustainability are becoming more important than ever. Energy unaffordability is threatening goal of fair
and just transition. There is lack of energy diversity.
 Recommendations:
• Urgent action by both public and private sectors to ensure resilient energy transition. Comprehensive
approach with proper timeline is critical to achieving long-term climate goals. Governments should prioritize
access to affordable energy for all. Energy equity can be ensured with help of Direct Benefits Transfer (DBT)
and other support measures. To diversify, import-dependent countries must try to import energy from
many countries and not overly depend on few countries. Domestic energy can be diversified with low-
carbon alternatives which make countries self-reliant and ensure energy security. Regulatory frameworks
need to be made robust to attract investments in clean energy and to ensure that commitments turn into
legally binding frameworks. Decarbonizing industries are critical to energy transition.
 Deen Dayal Upadhyay Gram Jyoti Yojana (DDUGJY) [2015]:
→ What:
 village electrification and providing electricity distribution infrastructure in rural areas
→ Objective:
 To provide electrification to all villages. Feeder separation [for sufficient power t o farmers and regular
supply to consumers]. Improvement of Sub -transmission and distribution network. Metering [to
reduce losses].
→ Implementation:
 REC Limited.
→ Under DDUGJY, India had connected every village to electricity .
 Saubhagya Scheme [2017]:
→ What:
 Pradhan Mantri Sahaj Bijli Har Ghar Yojana / PM Saubhagya to electrify all households by 2019. It is scheme to
ensure electrification of all willing households in India in rural as well as urban areas.
→ India had achieved universal access by connecting every household. [Union govt. declared that all willing
homes have been provided with electricity connections. ]
 Revamped Distribution Sector Scheme (RDSS) [2021]:
→ What:
 GOI scheme to help DISCOMs improve their operational efficiencies and financial sustainability by providing
result-linked financial assistance to DISCOMs to strengthen supply infrastructure based on meeting pre-

Page 706 of 719

 qualifying criteria and achieving basic minimum benchmarks. umbrella program for power sector reforms for
better operations & financial sustainability of all DISCOMs (excluding Private Sector DISCOMs). It is one reforms-
based and results-linked scheme to improve operational efficiencies and financial sustainability of DISCOMS
(excluding private sector DISCOMs). launched by Ministry of Power. reforms-based and results-linked scheme
to improve efficiencies and financial sustainability of all DISCOMs / Power Departments. This is done by financial
assistance for modernization of distribution infrastructure e.g., Smart Prepaid Meters.
→ Objective:
 Reduction of Aggregate Technical & Commercial (AT&C) losses to pan-India levels of 12-15% by 2024-25.
Reduction of Average Cost of Supply (ACS) and Average Revenue Realized (ARR) i.e., ACS-ARR gap to 0 by 2024-
25. Improvement in quality, reliability and affordability of power supply to consumers through financially
sustainable and operationally efficient distribution sector. Reduce financial deficit (average cost of supply-
average revenue realised) of DISCOMs to 0.
→ Component:
 Action plan for each State; Financial assistance to strengthen supply infrastructure of DISCOMS; Compulsory
smart metering; Feeder segregation (to enable solarization under PM KUSUM); Distribution strengthening:
Supervisory Control and Data Acquisition (SCADA) in all urban areas.
→ Feature:
 Conditional financial assistance to DISCOMs for strengthening supply infrastructure. Assistance will be based on
meeting pre-qualifying criteria and upon achievement of basic minimum benchmarks by DISCOM. Narrowing
deficit between cost of electricity and price at which it is supplied. Developing institutional capabilities for
modern DISCOMs. compulsory smart metering ecosystem funding for feeder segregation for unsegregated
feeders. solarization of agricultural feeders for farmers. Convergence: Existing power sector reforms schemes -
Integrated Power Development Scheme (IPDS); Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY); Pradhan
Mantri Sahaj Bijli Har Ghar Yojana (Saubhagya) will be merged into this umbrella program. Compulsory
installation of smart meters (target of installing 250 million smart meters by 2025). Timeline - 2021-22 to 2025-
26. Eligibility: All state-owned DISCOMs.
→ Implementation:
 Each State would have its own action plan for implementation, rather than ‘one-size-fits-all’ approach. Nodal
agencies: REC Limited and PFC Ltd. [1986] are nodal lending agencies for this RDSS.
Programs to be taken under it are: Prepaid Smart Meter, solarization of agriculture feeders, segregation
of feeders, use of AI, Training and Capacity Building, etc.
→ Funding:
 Centre and State governments in 3:2 ratio. State governments will be free to borrow from either REC-PFC or
from other financial institutions to mobilise their funds.
→ Performance issues:
 Insufficient Monitoring mechanism: Due to inadequate metering and data collection system in place, utilities
have not been able to conduct energy audit, which is crucial for any energy business.
 Accountability and Technology Issues: RDSS scheme could not reduce high Aggregate Technical & Commercial
(AT&C) losses due to high Transmission and Distribution (T&D) losses coupled with low collection efficiency. Low
level of collection is because of lack of employees’ accountability, inadequate collection facilities, limited usage
of advanced technology, billing errors etc.
 Lack of Consumer Records: RDSS have not put in mechanism for maintaining consumer database and asset
database, which can be addressed through IT, communication solutions. Most utilities maintain manual records
of consumers. This leads to mismanagement and losses.
 Revenue & Expenditure gaps: Gap between discoms’ costs (average cost of supply) and revenues (average
revenue realised), which was supposed to have been eliminated by now, stands at Rs 0.49 per unit in absence
of regular, proportional tariff hikes.
 Electrification and Support structure mismatch: RDSS have not been able to address gap between increasing
electrification and related supporting structural mechanism.
→ Powerthon-2022:
 What:
• hackathon competition under RDSS launched in 2022 by Ministry of Power to find technology driven
solutions to solve complex problems in power distribution.
 9 themes:
• Demand / load forecasting; AT&C (Aggregate Technical and Commercial) loss reduction; energy theft
detection; prediction of DT (Distribution Transformer) failure; asset inspection; vegetation management;
consumer experience enhancement; renewable energy integration; power purchase optimization.
 Integrated Power Development Scheme (IPDS):
→ It is scheme for strengthening of T&C, metering, IT enablement.
 Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY):
→ It is scheme for separation of agriculture and non -agriculture feeders in rural areas.
 GARV App / Grameen Vidyutikaran App:
Page 707 of 719
 → It is for monitoring implementation of electrification schemes.
 Ujjwal DISCOM Assurance Yojana / UDAY scheme / Pradhan Mantri Ujjwala Yojana programme:
→ It is for operational turnaround of DISCOMs. UDAY is financial turnaround and revival package for
electricity distribution companies of India. Initiated by GOI with intent to find permanent solution to
financial mess that power distribution is in. Its aim is for providing for financial turnaround and revival of
power distribution companies.
→ Government announced UDAY 2.0 which aims at installation of smart prepaid metres, prompt payment by
DISCOMs, making coal available for short term, reviving gas -based plants.
 Green Energy Corridor (GEC):
→ What:
 project for Intra-State Transmission System (InSTS).
→ Aim:
 synchronizing / integrating electricity produced from renewable sources (solar, wind, etc.) with conventional
power stations in grid.
→ Need:
 India pledged to increase non-fossil fuel power generation capacity to 500GW. India pledged to meet 50% of its
energy requirements from renewable sources by 2030.
→ Phase:
 Phase I:
• implemented by 8 renewable-rich States (HP, Rajasthan, Gujarat, MP, MH, Karnataka, AP, TN). target is to
install transmission lines and transformation capacity of substations. funding mechanism - 40% Government
of India Grant, 20% State equity, 40% loan from KfW Bank (Germany).
 Phase II:
• implemented in 7 States –HP, Rajasthan, UP, Gujarat, Karnataka, TN, Kerala. Increased target to install
transmission lines and transformation capacity of substations. Centre will provide assistance at 33% of cost
of project.
→ Significance:
 helps India to increase share of non-fossil fuels-based electricity to 40% by 2030. help in achieving
target of 450 GW installed RE capacity by 2030. contribute to long -term energy security. promote
ecologically sustainable growth by reducing carbon footprint. generate employment for both skilled
and unskilled in power. help in offsetting intra-State transmission charges, keeping power costs down
and thus ultimately benefitting end consumers. help India meet climate commitments it made at 2021
COP-26 Glasgow.
 The Energy and Resources Institute (TERI) [1974]:
→ What:
 research institute in New Delhi that specializes in fields of energy, environment, sustainable development.
formerly known as Tata Energy Research Institute. leading think tank dedicated to conducting research for
sustainable development of India and Global South. One independent, multi-dimensional research organization
with capabilities in policy research, technology development, and implementation.
→ Significance:
 information centre on energy issues. research institute, whose policy and technology solutions transformed
people’s lives and environment.
→ TERI’s “Roadmap to India’s 2030 Decarbonization Target” [2022]:
 What: This study proposes feasible pathways to achieve ambitious decarbonization targets which were
announced by India at COP26 in Glasgow, 2021. At COP26, India announced highly ambitious goal of
decarbonizing energy to 50% and achieving 500 GW of fossil fuel-free generating capacity by 2030.
 Finding: According to this TERI roadmap, in India, shares of renewables of Wind, Solar, Small Hydro, Biomass are
increasing year after year.
 Recommendation:
• Increase in share of decentralized solar power by introducing feed-in-tariff attractive enough for private
investment and approved by State Electricity Regulatory Commission; State leadership in development of
pumped storage plants, and feed-in-tariff for solar generation. Implementation of feed-in-tariff in kilo Watt
range would increase farmer incomes, create jobs and improve quality of power supply in rural areas; New
Energy storage solutions: While India has right policy regime in place, we need to adopt new energy storage
solutions and technologies which bring stability and flexibility to grid; Introducing requisite flexibility into
power system to integrate wind and solar power generation; Emphasis on India growing into cost-effective
and competitive manufacturing hub for renewable energy; Extension of PLI scheme to cover full spectrum
of renewable energy equipment production, solar panels, mirrors and sensors for solar thermal, batteries
for grid use, and hydrogen; DISCOMs need to give commercial and industrial consumers choice to buy
carbon-free electricity on real-time basis with separate tariffs.
 Electricity Act, 2003:

Page 708 of 719

 → What:
 Act to consolidate laws relating to generation, transmission, distribution, trading and use of electricity
and generally for taking measures conducive to development of electricity industry, promoting
competition therein, protecting interest of consumers a nd supply of electricity to all areas,
rationalization of electricity tariff, ensuring transparent policies regarding subsidies, promotion of
efficient and environmentally kind policies, constitution of Central Electricity Authority, Regulatory
Commissions and establishment of Appellate Tribunal.
→ Feature:
 Act regulates electricity sector in India. It sets up Central and State Electricity Regulatory Commissions
(CERC, SERCs) to regulate inter-State and intra-State matters, respectively.
→ Electricity (Amendment) Bill, 2022:
 What:
• BILL further to amend Electricity Act, 2003.
 Alliance for Industry Decarbonization [2022]:
→ It is one global Alliance launched in 2022 by IRENA, and some companies (including Tata Steel Ltd.). This new Alliance
aims to accelerate net-zero ambitions and decarbonization (reduction of carbon) of industrial value chains in pursuit
of Paris Agreement climate goals.
 Central Electricity Authority (CEA):
→ CEA advises GOI on policy matters and formulates plans for development of electricity systems. It is one statutory
organisation constituted under Electricity Supply Act 1948, which has been superseded by section 70 Electricity Act,
2003. Officers from Central Power Engineering Services Cadre, recruited through Engineering Services Examination
conducted by UPSC, are posted to Central Electricity Authority of India.
 Market-Based Economic Dispatch (MBED) Mechanism:
→ What:
 In order to move towards “One Nation, One Grid, One frequency, One Price” framework, Ministry of Power
proposed this one centralized power model. Under MBED, entire annual electricity consumption will be
operated using one central market operator. Currently India follows decentralized power procurement and
distribution system. It envisages centralised scheduling for dispatching entire annual electricity consumption of
around 1,400 billion units.
→ Background:
 Increasing losses of DISCOMS: As per one RBI study, bailout of DISCOMS in 18 large States is likely to impose
burden equivalent to around 2.3% of GSDP of these States.
→ Benefit:
 It will help in reducing power purchase costs, provide more flexibility, and promote renewable energy.
→ Issue:
 Fresh tussle between Centre and States over this MBED mechanism.
 It may lead to loss of autonomy of States (power is Concurrent subject and responsibility for distribution and
supply of power to rural and urban consumers rests with States).
 It may make DISCOMS entirely dependent on this centralised mechanism.
 Global Clean Energy Action Forum (GCEAF) [2022]:
→ One joint convening of 13th Clean Energy Ministerial and 7th Mission Innovation ministerial. Governments,
international organizations, private sector, academia, innovators, civil society, and early career researchers and
policymakers will join together in this event that features high-level plenary, topical roundtables with energy and
science ministers from 31 countries, CEOs and experts, side events, technology demonstrations, and other activities.
It will be hosted by USA government. GCEAF is 1st of its kind of meeting of over 30 countries to promote policies and
programmes that advance clean energy technology.
India (Union Minister Dr. Jitendra Singh and other delegates) will visit to USA to participate in this GCEAF at
Pittsburg, USA.
 Breakthrough Agenda [2021]:
→ One commitment, launched at COP26 in Glasgow (2021 UNCCC), to work together internationally this
decade to accelerate development and deployment of clean technologies and sustainable solutions needed
to meet our Paris Agreement goals, ensuring they are affordable and accessible for all.
→ Glasgow Breakthrough [2021]:
 1 st step launched under Breakthrough Agenda. Glasgow Breakthroughs are global goals that aim to make
clean technologies and sustainable solutions most affordable, accessible and attractive option in each
emitting sector globally before 2030.
COP-26 [2021] resulted in so-called “Glasgow Breakthroughs”, which are series of agreements
between developed and developing countries to rapidly scale up clean technologies in 5 sectors that
collectively account for more than 50% of global emissions:
• 1st is called “Power”: What is meant here are alternative energy resources that are clean and become most
affordable option and become mainstay for all countries to meet world’s energy needs efficiently by 2030;

Page 709 of 719

 • 2nd is “Land Transportation”: Zero-emission vehicles are one thing that will become necessity in future. Such
vehicles must be accessible, affordable, and sustainable in all countries by 2030;
• 3rd is “Steel”: Zero-emissions or near-zero-emissions steel industry is more desirable option in global market
through use of more efficient steel products in every country by 2030;
• 4th is “Hydrogen”: Hydrogen gas is meant to be renewable, affordable, and low carbon. It is hoped that this
kind of hydrogen gas will be available globally by 2030;
• 5th is “Agriculture”: Smart, climate-resilient and sustainable agricultural practices are most attractive option
and are widely adopted by farmers everywhere by 2030.
 India: India is among 42 leaders to back and sign up for UK’s Glasgow Breakthroughs. India is also one
co-convener of Glasgow Breakthrough on Road Transport, together with UK and US. India is 5 th largest
and fastest growing vehicle market in world, providing massive potential for electric vehicle uptake.
→ “Breakthrough Agenda Report 2022”:
 One report released jointly by IEA, IRENA and UN Climate Change High-Level Champions in 2022. It focused on
supporting stronger international collaboration to drive faster reductions in global GHG emissions. This is one
1st-of-its-kind annual progress report, requested by world leaders at UNCCC COP26 in 2021 as part of launch of
Breakthrough Agenda. This report is designed to inform policy makers, business leaders and civil society
organisations of most urgent ways to strengthen collaboration in and across major emitting sectors. It is one
report on progress of how countries have aligned their action plan and investment for clean technology
commitment to mitigate climate change.
This inaugural report assesses progress on reducing emissions in 5 key sectors – power, hydrogen, road
transport, steel, agriculture.
This report recommends to strengthen collaboration between governments, business and civil society
in areas such as common standards, technology R&D, reaching level playing field for trade, and improving
technical and financial assistance.
Value Addition:
 Great Reset:
→ Name of 50th annual meeting of WEF, held in 2020. This meeting brought together high -profile business
and political leaders, convened by Charles, Prince of Wales and WEF, with theme of seizing upon global
crisis to rebuild society and economy following COVID -19 pandemic.
 Net zero / Net-zero:
→ balance between amount of greenhouse gas (GHG) produced and amount removed from atmosphere. We
reach net zero when amount we add is no more than amount taken away.
 Energy mix:
→ group of different primary energy sources from which secondary energy for direct use - such as electricity
- is produced. Energy mix refers to all direct uses of energy, such as transportation, housing. Thus, it is not
to be confused with power generation mix, which refers only to generation of electricity.
 Central Electricity Regulatory Commission (CERC):
→ What:
 statutory body under Electricity Act, 2003.
→ Aim:
 promote competition in power markets. efficiency in power markets. economy in power markets .
→ Functions:
 improve quality of electricity supply. promote investments in electricity. advise government related to electricity
matter.
 National Grid:
→ What:
 One nation, one gas grid. high-voltage electric power transmission network in India. connects power
stations.
→ Aim:
 electricity generated anywhere in India can be used to meet demand elsewhere.
→ Evolution:
 Regional Grid connection started in 1960s. Regional grids are interconnected and synchronized at one
frequency. One Nation-One Grid-One Frequency achieved.
→ Benefits:
 Availability. lesser power cuts. stability in power. synchronisation.
Glossary:
 Feed-in-tariff:
→ Policy mechanism designed to accelerate investment in renewable energy technologies by offering long -
term contracts to renewable energy producers.
Question:

Page 710 of 719

  UNFCCC Secretariat launched “Momentum for Change: Climate Neutral Now” initiative in 2015, which urges individuals,
companies, and governments to measure their climate footprint, reduce their GHG emissions as much as possible.
 ‘Global Climate Change Alliance’ is one initiative of EU. It provides technical and financial support to targeted developing
countries to integrate climate change into their development policies and budgets.
 Blue carbon is term for carbon captured by world's ocean and coastal ecosystems.
 ‘Photovoltaics’ is one technology that generates electricity by direction conversion of light into electricity, while ‘Solar
Thermal’ is one technology that utilizes Sun’s rays to generate heat which is further used in electricity generation process.
Principle behind both types of solar panels – solar photovoltaic (PV) and solar thermal – is same. They absorb raw energy
from sun and use it to create usable energy. In solar PV systems, this is through creation of electricity, whereas thermal
systems are used directly for heating water or air. Both technology convert solar energy into DC. India has one
manufacturing base for both Solar Thermal as well as PV cells.
 REPowerEU is a European Commission proposal to end reliance on Russian fossil fuels before 2030 in response to the
2022 Russian invasion of Ukraine.
 Inflation Reduction Act, 2022 is a USA federal law which aims to curb inflation by reducing the deficit, lowering
prescription drug prices, and investing into domestic energy production while promoting clean energy.
Mains Link:
 Examine the constraints for India in its transition towards a clean energy system. Also, suggest measures to overcome
them. (15M)
 “Despite increase in renewable energy capacity, India still heavily depends on fossil fuels for its energy security”. What
measures need to be taken to increase the pace of renewable adoption in India? Discuss. (15M)
 India needs a Solar Waste Management and Manufacturing Standards Policy. Do you agree? Comment. (10M)
 What are the problems being faced by the Power Sector? Will the recently proposed Electricity (Amendment ) Bill 2022
help overcome these issues? Critically evaluate (15M)
 Discuss the ways that India can achieve energy security and strategic autonomy in the energy sector by 2040.
 UN Secretary General A. Guterres says “Humanity faces stark choice between breakdown or breakthrough”.

MARINE / MARITIME [Environment]

News:
 2021:
→ INCOIS to conduct aerial mapping of AN Islands and Lakshadweep to get better picture of ocean floor (Bathymetric
study).
→ NAT GEO recognises ‘Southern Ocean’ as world’s 5th ocean.
→ Cabinet approves Deep Ocean Mission.
 2022:
→ In cooperation with UN, WB, France organizes One Ocean Summit in its city Brest, France. India participates in this
event. During this event at One Ocean Summit [2022], one High Ambition Coalition on Biodiversity Beyond National
Jurisdiction (BBNJ) is also launched.
→ World Oceans Day celebrated on June 8.
→ “Blue Deal” is being promoted at 2022 UN Ocean Conference to enable sustainable use of ocean resources for
economic growth.
→ 2nd UNOC ended with Lisbon Declaration titled ‘Our Ocean, Our Future: Call for Action’. It was co-hosted by Kenya
and Portugal in Lisbon. [1st UNOC was in New York in 2017]. During this 2022 UNOC, UNESCO launches one new
flagship report entitled “State of Ocean Report”, offering brief, accessible, one-stop overview of current state of
ocean, and to mobilize global society to act - and monitor progress - towards global goals.
→ As part of Deep-sea mission, scientists from National Institute of Ocean Technology (MoES) conducts world’s deepest
underwater locomotion trials of Deep-Sea Mining System in Central Indian Ocean at depth of 5270 m.
→ Indian team is deliberating on ocean diversity pact. One key aspect of this agreement is deciding on rights of
companies that undertake exploration for marine resources. One delegation from India and other member countries
of UN are in New York to deliberate on one one-of-its-kind agreement to conserve marine biodiversity in high seas,
namely oceans that extend beyond countries’ territorial waters. [This agreement follows resolution by UNGA in early
2022 and is expected to be final in series set in motion since 2018 to draft one international legally binding instrument
under 1982 UNCLOS. High seas comprise nearly 45% of Earth’s surface. Indian delegation comprises officials from
MoES, Centre for Marine Fisheries and Research Institute, Ministry of External Affairs].
→ WMO releases GOOS Ocean Observing System Report Card 2022, highlighting marine and ocean data.
→ Climate observing system remains fragile, needs funding: Global Climate Observing System (GCOS) conference
declaration 2022 reads climate observing system remains fragile and needs financing for strengthening and
sustaining it, and that sustainable and long-term funding is essential to ensure the continuity and expansion of
observations.
About:
 Ocean:
→ Southern Ocean:
 What:
Page 711 of 719
 • only ocean to touch 3 other oceans and to completely contain continent. northern limit is 60 degress
latitude South.
 Antarctic Circumpolar Current (ACC) / West Wind Drift:
• Southern Ocean’s ocean-current that flows clockwise (as seen from South Pole) from west to east
around Antarctica.
 Mining activity in sea:
→ Gas hydrates. Precious metals. Fossil fuel resources. With advances in biotechnology and genetic
engineering, several companies see potential in exotic microbes and other o rganisms which could be used
for drugs, vaccines and variety of commercial applications.
 Concern:
→ Threats to Ocean: Pollution, overfishing, invasive species, rising ocean acidity due to extensive use of fossil
fuels. Plastic waste is also one of biggest threats faced by oceans today. Marine Pollution: Nutrient
pollution; Untreated wastewater; Solid waste discharges; Hazardous substance; Emissions from maritime
sector, including shipping, shipwrecks; Anthropogenic underwater noise.
 Significance:
→ Ocean covers 70% of Earth’s surface. Ocean is planet's largest biosphere, and is home to up to 80% of all
life in world. It generates 50% of oxygen we need, absorbs 25% of all CO2 emissions and captures 90% of
additional heat generated from those emissions. It is not just ‘lungs of planet’ but also its largest carbon
sink - vital buffer against impacts of climate change. Ocean nurtures unimaginable biodiversity and
produces food, jobs, mineral and energy resources needed for life on planet to survive and thrive. Oceans
cover 70% of Earth’s surface and hold 97% of Earth’s water. Oceans help feed world and provide most of
oxygen. Variety of life-saving medicinal compounds, including anti-inflammatory, anti-cancer drugs have
been discovered in oceans. Ocean is vital to world’s economy, with more than 90% of trade using sea
routes and as source of jobs for millions of people.
→ Importance of sustainable oceans and seas:
 Poverty eradication. Sustained economic growth. Food security and creation of sustainable livelihoods. Helping
to build resilience to impacts of climate change.
 Initiatives on Ocean:
→ London Convention (1972):
 Its objective is to promote effective control of all sources of marine pollution.
→ MARPOL Convention.
→ Clean Sea Campaign: Turn tide on plastic [2017]:
 What:
• Through this Clean Seas platform, UNEP is connecting and rallying individuals, civil society groups, industry
and governments for catalyzing change and transforming habits, practices, standards and policies around
globe to dramatically reduce marine litter and its -ve impacts. UNEP launched Clean Seas (#CleanSeas)
in 2017, with aim of engaging governments, general public and private sector in fight against
marine plastic pollution. It aims to ban SUPs and microbeads.
 Performance:
• Since its launch in 2017, this campaign has become catalyst for change, transforming habits, practices,
standards and policies around globe. To date, 63 countries have joined, making Clean Seas Campaign
biggest, most powerful global coalition devoted to ending marine plastic pollution. Commitments by
signatory countries now cover more than 60% of world’s coastlines. Land locked countries are also coming
on board, seeing value of its source to sea approach. Countries, businesses and individuals have pledged to
turn tide on plastic waste. Clean Seas campaign contributes to goals of Global Partnership on Marine Litter
(GPML), one voluntary open-ended partnership for international agencies, governments, businesses,
academia, local authorities and non-governmental organizations to cooperate and innovate on tackling
marine litter and plastic pollution.
→ One Ocean Summit:
 Its aim is to raise collective level of ambition of international community on marine issues. Under this,
commitments will be made towards combating illegal fishing, decarbonising shipping, reducing plastic pollution.
Focus will be on efforts to improve governance of high seas and coordinating international scientific research.
This One Ocean Summit contributes to Decade of Ocean Science for Sustainable Development (2021-2030).
During 2022 One Ocean Summit, one High Ambition Coalition on Biodiversity Beyond National Jurisdiction
(BBNJ) was also launched and India supports this French initiative. This coalition gathers parties which are
committed, at highest political level, to achieve ambitious outcome of ongoing negotiations on Treaty of High
Seas (implementing agreement on Biodiversity Beyond National Jurisdiction), under auspices of UN.
→ GloLitter Partnerships Project:
 GloLitter Partnerships is one project between Norway, IMO and UNFAO aiming to reduce marine litter. This
global project will support developing countries, including Small Islands Developing States (SIDS) and LDCs, in
identifying opportunities for prevention and reduction of marine litter. It was launched by IMO and UNFAO and
initial funding from Norway. It is aimed to prevent and reduce marine plastic litter from shipping and fisheries.
Page 712 of 719
 → UN Decade of Ocean Science for Sustainable Development (2021 -30) / Ocean Decade:
 Ocean Decade provides one common framework to ensure that ocean science can fully support countries to
achieve 2030 Agenda for Sustainable Development. In 2017, UN proclaimed it to support efforts to reverse cycle
of decline in ocean health and gather ocean stakeholders worldwide behind one common framework that will
ensure ocean science can fully support countries in creating improved conditions for sustainable development
of Ocean. Its vision is "science we need for ocean we want". Ocean Decade is one convening framework for
diverse stakeholders to co-design and co-deliver solution-oriented research needed for well-functioning ocean
in support of 2030 Agenda. Capacity development, ocean literacy and removal of barriers to full gender,
generational, and geographic diversity are essential elements of Ocean Decade.
 India:
→ Initiative:
 Deep Ocean Mission [2018]; O-SMART (Ocean — Services, Modelling, Application, Resources and
Technology); Indian National Centre for Ocean Information Services (INCOIS); Blue Economy: It is sustainable
use of ocean resources for economic growth, improved livelihoods and jobs and its size in India is about 4% of
GDP. Automated Buoy-based coastal observation and water quality Nowcasting system will provide real-time
measurements such as temperature, salinity, dissolved oxygen, turbidity, etc. Sagarmala initiative.
Note:
 International Hydrographic Organization (IHO) [1921]:
→ body that recognises oceans, ocean boundaries etc.
 NAT GEO / National Geographic / National Geographic magazine:
→ long-lived official monthly magazine of National Geographic Society [1888]. among most widely read
magazines of all time.
 National Geographic Society [1888]:
→ Washington, D.C., United States. among largest non -profit scientific and educational organizations in
world.
 United Nations Ocean Conference (UNOC) [2017]:
→ It was one UN conference that took place in 2017 which sought to mobilize action for conservation and
sustainable use of oceans, seas and marine resources.
→ 2022 UNOC:
 2nd UNOC ended with Lisbon Declaration titled ‘Our Ocean, Our Future: Call for Action’. It was co-hosted by
Kenya and Portugal in Lisbon.
 Lisbon Declaration [2022]:
• Protecting at least 30% of national maritime zones by 2030. Achieving carbon neutrality by 2040. Allocating
funds to research on ocean acidification, climate resilience and surveillance. Scale-up science-based and
innovative actions to address ocean emergency. Support implementation of SDG14 (Life below water) by
empowering women and girls - recognising their participation is crucial to building sustainable ocean-based
economy. Protect biodiversity in marine Areas Beyond National Jurisdiction (ABNJ), which lie outside 200-
mile EEZ of countries.
• India: India will take up Coastal clean-up sea campaign (‘Swachh Sagar, Surakshit Sagar’ / “Clean Coast, Safe
Sea”). Ban on SUPs.
 Deep Ocean Mission [2018]:
→ What:
 Deep Ocean Mission is Indian initiative to undertake deep ocean exploration by focussing on: deep sea
mining; ocean climate change advisory services; and underwater technologies – vehicles, robotics etc.,
on India's exclusive economic zones (EEZ); and India’s continental shelf (CS) . Ministry of Earth Sciences
(MoES) - nodal / implementing Ministry.
→ Aim:
 Primarily to explore and extract polymetallic nodules (PMN). Searching deep -sea flora and fauna,
including microbes, and studying ways to sustainably utilise them. Identify potential sources of
hydrothermal minerals that are sources of precious metals formed from earth’s crust along Indian
Ocean mid-oceanic ridges. Preparing engineering design for offshore Ocean Thermal Energy
Conversion (OTEC) powered desalination plants.
→ Component:
 submersible vehicle – manned, scientific sensors, equipments - for mining polymetallic nodules (PMN).
Development of Ocean Climate Change Advisory Services. searching deep sea flora, fauna, microbes –
to sustainably utilise them. explore and identify sources of hydrothermal minerals along Indian Ocean
mid-oceanic ridges – to extract precious metals formed from earth’s crust. desalination plant –
powered by Ocean Thermal Energy Conversion (OTEC).
→ Feature:
 Under this deep-sea mission (2021-26), one manned submersible will be developed to carry 3 people
to depth of 6,000 metres in ocean. One Integrated Mining System will be developed for mining
polymetallic nodules at those depths in central Indian Ocean.
Page 713 of 719
 → Potential:
 International Seabed Authority has allotted thousands of sq. kms to India in Central Indian Ocean Basin
(CIOB) for exploration of poly-metallic nodules
→ Significance:
 explore India’s vast Exclusive Economic Zone (EEZ) and Continental Shelf (CS). development of India’s
capabilities to extract ocean resources in CIOB. These reserves can meet India’s energy requirement
for centuries.
 State of Ocean Report [2022]:
→ This report was launched during 2022 UNOC by UNESCO. It is one new flagship report offering brief, accessible, one-
stop overview of current state of ocean, and to mobilize global society to act - and monitor progress - towards global
goals.
 World Oceans Day:
→ June 8, every year. Concept of World Oceans Day was 1st proposed by UN in 1992 at Earth Summit in Rio
de Janeiro. 2022 Theme: “Revitalization: collective action for ocean”.
 International Seabed Authority [1994]:
→ UN body. estd. by 1982 UNCLOS.
 Central Indian Ocean Basin (CIOB):
→ CIOB reserves found include Poly Metallic Nodules (PMN) / Manganese nodules which are potato-shaped,
porous nodules and found in abundance on sea floor in deep sea of world oceans. PMN contains deposits
of metals, of which Manganese, Iron, Nickel, Copper, Cobalt, are of economic and strategic importance.
Usage: Said metals are used in electronic devices, smartphones, batteries, solar panels.
→ India has been allotted 75,000 square kilometres in CIOB by UN International Seabed Authority for
exploration of poly-metallic nodules. It is envisaged that 10% recovery of this la rge reserve can meet
energy requirement of India for next 100 years.
 Indian National Centre for Ocean Information Services (INCOIS):
→ What:
 autonomous organization under MoES.
→ Mandate:
 provide ocean information and advisory services. to society, industry, government agencies and
scientific community.
 O-SMART:
→ Ocean — Services, Modelling, Application, Resources and Technology. scheme that aims at regulated use
of oceans, marine resources for sustainable development. stepping up ocean research. sett ing up early
warning weather systems. MoES.
 Blue Deal [2022]:
→ What:
 One initiative promoted at 2022 UN Ocean Conference to enable sustainable use of ocean resources
for economic growth. According to UNCTAD, Blue Deal includes global trade, investment, and
innovation to create sustainable and resilient ocean economy.
→ Benefit:
 UNCTAD says, under this Blue Deal initiative, Coastal and island developing nations can benefit from
sustainable development of ocean economy, including fisheries, aquaculture, coastal tourism,
maritime transport, offshore renewable energy, ecosystem services, marine genetic resources. Experts
say this Blue Deal initiative can create jobs and generate revenue for Coastal and island developing
nations. Currently, sea facilitates over 80% of volume of world trade.
 Ocean diversity pact [in negotiation]:
→ Legally binding instrument: This agreement follows resolution by UNGA in early 2022 and is expected to be final
in series set in motion since 2018 to draft one international legally binding instrument under 1982 UNCLOS.
→ Rights of companies: This agreement will decide on rights of companies that undertake exploration for
biological resources on high seas. To decide if companies have absolute rights on any discovery or
extraction in these regions or should they share their gains, in terms of intellectual property and royalties
with UN-prescribed body.
→ Studies on sustainable utilization of deep -sea bio-resources: It will be main focus. There are companies
already carrying out such exploratory activities though little was known about them. Hence international
agreement that spells out obligations and permissible activities is important.
 Global Ocean Observing System (GOOS):
→ One global system for sustained observations of ocean comprising oceanographic component of Global
Earth Observing System of Systems (GEOSS). GOOS is administrated by Intergovernmental Oceanographic
Commission (IOC), and joins Global Climate Observing System (GCOS), and Global Terrestrial Observing
System (GTOS), as fundamental building blocks of GEOSS.
→ GOOS Ocean Observing System Report Card 2022:
 One report released by WMO in 2022, highlighting marine and ocean data.
Page 714 of 719
  Finding: Ocean takes up 26% of 40 gigatons of carbon emitted to atmosphere annually.
 Recommendation: Ensure access to FAIR Data (Findability, Accessibility, Interoperability, and
Reusability); establish early warning system to reduce coastal zone risks.
 Global Climate Observing System (GCOS) [1992]:
→ What:
 GCOS is a system that comprises the climate-relevant components of many contributing observing
systems and networks. This programme promotes the sustained provision and availability of reliable
physical, chemical and biological observations and data records for the total climate system - across
the atmospheric, oceanic and terrestrial domains, including the hydrological cycle, the carbon cycle
and the cryosphere. Its parent organization is UNFCCC.
 GCOS regularly assesses the status of global climate observations of the atmosphere, land and ocean
and produces guidance for its improvement.
→ Objective:
 To ensure that the observations and information needed to address climate -related issues are
obtained and made available to all potential users.
 Its mission is to help ensure that these contributing observing systems and networks, taken as a whole,
provide the comprehensive information on the global climate system that is required by users,
including individuals, national and international organizations, institutions and agencies.
GCOS is co-sponsored by WMO, Intergovernmental Oceanographic Commission (IOC) of
UNESCO, UNEP, and International Council for Science (ICSU).
→ Origin:
 GCOS was established in 1992 as an outcome of the 2 nd World Climate Conference, to ensure that the
observations and information needed to address climate -related issues are obtained and made
available to all potential users.
→ Function:
 In order to assess and monitor the adequacy of in -situ observation networks as well as satellite-based
observing systems, GCOS regularly reports on the adequacy of the current climate observing system
to UNFCCC, and thereby identifies the needs of the curr ent climate observing system.
Glossary:
 Nowcasting:
→ It is weather forecasting on very short term mesoscale period of up to 2 hours according to WMO and up
to 6 hours according to other authors in this field.
Value Addition:
 Hydrothermal vent:
→ What:
 Fissure on seafloor from which geothermally heated water discharges. commonly found near
volcanically active places, areas where tectonic plates are moving apart at spreading centers, ocean
basins, hotspots. Hydrothermal vents are formed at locations where seawa ter meets magma.
→ Cause:
 Hydrothermal vents are result of seawater percolating down through fissures in ocean crust in vicinity
of spreading centers or subduction zones (where 2 tectonic plates move away or towards one another).
Cold seawater is heated by hot magma and reemerges to form Hydrothermal vents.
→ Hydrothermal deposits:
 rocks and mineral ore deposits formed by hydrothermal vents. Sea -floor hydrothermal vents can pump
out rare-earth elements (REE) dissolved in their hot fluids. ( -> Deep seabed mining)
Question:
 International Code for Ships Operating in Polar Waters / Polar Code [2014]:
→ Polar Code is one international regime adopted by IMO in 2014. This Code sets out regulations for shipping
in polar regions, principally relating to ice navigation and ship design. This international framework aims
to protect 2 polar regions — Arctic (north pole region) and Antarctic (south pole region), from maritime
risks. This Code entered into force in 2017. It is international code of safety for ships operating in polar
waters.
→ Coastal state has right to establish breadth of its territori al sea up to limit not exceeding 12 nautical miles,
measured from baseline. EEZ shall not extend beyond 200 nautical miles from baseline from which breadth
of territorial sea is measured. According to UNCLOS regarding territorial limits of sea, every state has right
to establish breadth of its territorial sea up to limit not exceeding 12 nautical miles, measured from
baselines determined in accordance with this Convention. 1982 UNCLOS defines EEZ as area that shall not
extend beyond 200 nautical miles from baselines. EEZ is measured from breadth of territorial sea.
 Ocean Mean Temperature (OMT) is measured up to depth of 26 degrees isotherm. It is measured with help of satellites
that orbit earth. In Indian ocean, OMT is analysed by measuring ocean thermal energy during period from January to
March. OMT collected during January-March can be used in assessing whether amount of rainfall in monsoon will be less
or more than certain long-term mean.
Page 715 of 719
Mains Link:
 Examine the impact of marine pollution on coasts and coastal ecology. Also, discuss conservation methods to clean
coasts. (15M)
 How do ocean currents and water masses differ in their impacts on marine life and the coastal environment? (UPSC 2019)

GANGA RIVER [Environment]

News:
 2021:
→ Ganga is polluted with Microplastics of single-use plastic (SUP), secondary plastic products.
→ NMCG released policy document on conservation of river Ganga.
→ National Mission for Clean Ganga (NMCG) sets Guinness World Record on Ganga Utsav for highest number
of photos of handwritten notes uploaded on Facebook in 1 hour.
 2022:
→ Jal Shakti Ministry unveils new initiative - Arth Ganga (under Namami Gange Programme). GOI launched
new initiatives under Arth Ganga - Jalaj, MoU with Sahakar Bharti for natural farming, tourism-related
portal ImAvatar.
→ Dolphins return to Ganga in UP as water quality improves: UP govt. says Dolphins have started coming back to the
Ganga River with improvement in the quality of its water through the Namami Gange programme. UP government
claims that with the completion of 23 projects under the ambitious Namami Gange programme started in 2014, UP
State has successfully stopped flowing of more than 460 MLD of sewage into the Ganga in UP State. Under the
programme, additional treatment capacity of about 33 MLD (including 130 MLD that has been repaired) will also be
created in 2022, said UP government. [At present, the population of dolphins in Ganga in UP is estimated to be
around 600].
UP government added that there has been a lot of improvement in dissolved oxygen (DO), biochemical demand
(BOD) and fecal coliform (FC) parameters as well (fecal coliform is a bacteria). UP government also says test found
that pH (how acidic the water was) at 20 locations met the water quality criteria for bathing, while DO, BOD and FC
improved many locations.
About:
 Pollution in Ganga River:
→ Microplastics in Ganga R.:
 Source:
• Untreated sewage [from many cities along Ganga river’s course].
• Industrial waste
• Religious offerings wrapped in non-degradable plastics
 How:
• Plastic products, waste materials dumped in Ganga river break down into microplastics.
→ Initiatives by India:
 Department of Water Resources, River Development & Ganga Rejuvenation, Ministry of Jal Shakti
 National Mission for Clean Ganga (NMCG) [2011].
 Initiative:
→ National Ganga River Basin Authority (NGRBA) [2009] . National Mission for Clean Ganga (NMCG) [2011].
Namami Gange Programme [2014]. National Ganga Council [2016]. Clean Ganga Fund (CGF). Jalaj initiative (skill
enhancement along with Ganga Conservation). Sahakar Bharati Grams (sustainable economic development by public
participation via Sahakar Bharati organisation). ImAvatar (tourism-related webpage, aiming to improve
livelihood prospects throughout Ganga basin by facilitating travel, marketing regional goods including
handicrafts and agricultural products, and preserving ghats and other assets built by NMCG ). New course
‘River Champ’ on CLAP (Continuous Learning and Activity Portal [CLAP] is one online platform for raising awareness,
actions and debates around river conservation in India).
 Significance:
→ Ganga Basin’s contribution is about 3% of GDP.
Note:
 National Ganga River Basin Authority (NGRBA) [2009]:
→ constituted under Environment (Protection) Act [EPA], 1986.
→ headed by PM
→ dissolved in 2016, consequent to constitution of National Council for Rejuvenation, Protection and
Management of River Ganga (National Ganga Council).
 National Mission for Clean Ganga (NMCG) [2011]:
→ What:
 registered society [under Societies Registration Act, 1860]
 implementation arm of National Ganga Council [2016].
 Department of Water Resources, River Development & Ganga Rejuvenation, Min. of Jal Shakti.

Page 716 of 719

 → NMCG policy document on conservation of river Ganga:
 Feature:
• Cities situated on Ganga river banks must incorporate river conservation plans when they prepare their
Master Plans.
• These “river-sensitive” plans must be practical and consider questions of encroachment and land
ownership.
• systematic rehabilitation plan / relocation strategy for such encroaching entities that emphasizes alternative
livelihood
 Applicability:
• towns that are on main stem of river Ganga (mainly - Uttarakhand, Uttar Pradesh, Bihar, Jharkhand, West
Bengal).
 Namami Gange Programme [2014]:
→ What:
 It is an Integrated Conservation Mission, approved as ‘Flagship Programme’ by GOI in 2014 with budget outlay
of Rs. 20,000 Crore to accomplish the twin objectives of effective abatement of pollution, conservation and
rejuvenation of National River Ganga. It is under Ministry of Jal Shakti.
It was launched with the objective to rejuvenate Ganga by adopting an integrated approach which
focused on the interception and diversion of sewage by tapping the drains flowing into the river Ganga.
→ Objective:
 Ending pollution of National River Ganga
 Conservation and rejuvenation of National River Ganga.
→ Implementation:
 by National Mission for Clean Ganga (NMCG), and its State counterpart organizations. Its implementation has
been divided into Entry-Level Activities (for immediate visible impact), Medium-Term Activities (to be
implemented within 5 years of time frame) and Long-Term Activities (to be implemented within 10 years).
→ Funding:
 centrally-funded
 non-lapsable
→ Main Pillars:
 Sewerage Treatment Infrastructure.
 River-Surface Cleaning.
 Afforestation.
 Industrial Effluent Monitoring.
 River-Front Development.
 Bio-Diversity.
 Public Awareness.
 Ganga Gram.
→ Achievements:
 Key achievements under Namami Gange programme are:
• Creating Sewerage Treatment Capacity:
 48 sewage management projects are under implementation and 98 sewage projects have been
completed in Uttarakhand, Uttar Pradesh, Bihar, Jharkhand, West Bengal, Delhi, Himachal Pradesh,
Haryana, and Rajasthan.
 11 sewage projects are under tendering and 12 new sewage projects launched in these States. Work is
under construction for creating a sewerage capacity of 5175.87 (MLD).
• Creating River-Front Development:
 68 Ghats / Crematoria projects for construction, modernization, and renovation of 267 Ghats /
Crematoria and Kunds / Ponds have been initiated.
• River Surface Cleaning:
 River Surface cleaning for collection of floating solid waste from the surface of the Ghats and River and
its disposal are prepared and pushed into service at 11 locations.
• Bio-Diversity Conservation:
 One of NMCG’s long-term visions for Ganga rejuvenation is to restore viable populations of all endemic
and endangered biodiversity of the river, so that they occupy their full historical range and fulfil their
role in maintaining the integrity of the Ganga river ecosystems. To address this, Wildlife Institute of
India (WII), Dehradun, State Forest Departments have been awarded projects to develop science -
based aquatic species restoration plan for Ganga River by involving multiple stakeholders along with
conservation & restoration of aquatic biodiversity.
WII has identified high biodiversity areas in river Ganga for focused conservation action.
Rescue & rehabilitation centers have been established for the rescued aquatic biodiversity. Cadre of
volunteers (Ganga Praharis) have been developed and trained to support conservation actions in the

Page 717 of 719

 field. Floating interpretation centre “Ganga Tarini” and interpretation centre “Ganga Darpan” have
been established for developing awareness on biodiversity conservation and Ganga rejuvenation. Key
ecosystem services of Ganga river have been identified and an assessment framework has been
developed to strengthen the environmental services in the river basin.
Further, Uttar Pradesh State Forest Department is implementing a program on expansion of
conservation breeding of freshwater turtles and Gharial at Kukrail Gharial Rehabilitation Centre,
Lucknow which will help in revival and restoration of Gharials and turtles in the Ganga basin.
• Afforestation:
 One of the major components of Ganga rejuvenation is ‘forestry interventions’ to enhance the
productivity and diversity of the forests in head water areas (source) and all along the river and its
tributaries. Accordingly, Forest Research Institute (FRI), Dehradun prepared a Detailed Project Report
(DPR) for afforestation in an area of 1,34,106 hectares in the Ganga river bank States of Uttarakhand,
Uttar Pradesh, Bihar, Jharkhand and West Bengal.
• Public Awareness:
 A series of activities such as events, workshops, seminars and conferences and numerous IEC activities
were organized by National Mission for Clean Ganga to make a strong pitch for public outreach and
community participation in the programme. Various awareness activities through rallies, campaigns,
exhibitions, shram daan, cleanliness drives, competitions, plantation drives and development and
distribution of resource materials were organized and for wider publicity the mass mediums such as
TV/Radio, print media advertisements, advertorials, featured articles and advertorials were published.
Gange Theme song was released widely and played on digital media to enhance the visibility of the
programme. NMCG ensured presence at Social Media platforms like Facebook, Twitter, You Tube etc.
• Industrial Effluent Monitoring:
 The number of Grossly Polluting Industries (GPIs) in April, 2019 are 1072. Regulation and enforcement
through regular and surprise inspections of GPIs is carried out for compliance verification against
stipulated environmental norms. The GPIs are also inspected on annual basis for compliance
verification of the pollution norms and process modification, wherever required through 3rd party
technical institutes. Action has been taken against 110 non-complying GPIs and are issued closure
directions under Environment Protection Act, 1986. Online Continuous Effluent Monitoring Stations
(OCEMS) connectivity established to CPCB server in 885 out of 1072 GPIs.
• Ganga Gram:
 Ministry of Jal Shakti identified 1674 Gram Panchayats situated on the bank of River Ganga in 5 State
(Uttarakhand, Uttar Pradesh, Bihar, Jharkhand, West Bengal). Constructed about 8 lakh toilets in 1674
Gram Panchayats of 5 Ganga Basin States. Consortium of 7 IITs has been engaged in the preparation of
Ganga River basin Plan and 65 villages has been adopted by 13 IITs to develop as model villages. UNDP
has been engaged as the executing agency for rural sanitation programme and to develop Jharkhand
as a model State.
 National Ganga Council [2016]:
→ National Council for Rejuvenation, Protection and Management of River Ganga.
→ to clean up Ganga river.
→ headed by Prime Minister
→ It replaced dissolved NGRBA.
 Clean Ganga Fund (CGF):
→ What:
 Trust
 setup under Indian Trust Act, 1882.
→ Purpose:
 allows resident Indians, Non Resident Indians (NRI), Persons of Indian Origins (PIO), Corporates (Public sector,
private sector) to contribute towards conservation of river Ganga.
→ Significance:
 enthusiasm of people for Ganga River
 bring people closer to Ganga River and inculcate sense of ownership.
 towards clean and healthy Ganga River.
 Arth Ganga model [2022]:
→ GOI’s new model for Ganga river’s sustainable development. It is concept of sustainable economic
development of river Ganga Basin with people participation by focusing on surrounding areas and involving
them in sustainable economic activities.
→ Arth Ganga’s 6 verticals on which government is working:
 Zero Budget Natural Farming: It involves chemical-free farming on 10 km on either side of Ganga river, and
promotion of cow dung as fertiliser through GOBARdhan scheme.
 Monetization and Reuse of Sludge & Wastewater: It seeks to reuse treated water for irrigation, industries and
revenue generation for ULBs.
Page 718 of 719
  Livelihood Generation Opportunities: By creating haats where people can sell local products, medicinal plants
and ayurveda (i.e. local haats).
 Public participation: To increase public participation by increasing synergies between stakeholders involved with
Ganga river.
 Cultural heritage and tourism of Ganga and its surroundings: This model also wants to promote cultural heritage
and tourism of Ganga and its surroundings, through boat tourism, adventure sports and by conducting yoga
activities.
 Empowering local administration: This model seeks to promote institutional building by empowering local
administration for improved water governance.
 Ganga Utsav:
→ annual event
→ organised by National Mission for Clean Ganga (NMCG) jointly with Ministry of Jal Shakti
→ to mark anniversary of announcement of River Ganga as ‘National River’ in 2008.
→ 2021 Ganga Utsav celebrations is part of 75 years of Independence and Azadi ka Amrit Mahotsav
celebrations. NMCG got registered in Guinness Book of Worl d Records for highest number of photos of
handwritten notes uploaded on Facebook in 1 hour.
Value Addition:
 Mitras – Friends of Ganges:
→ volunteers –individuals or groups –involved in various aspects of conservation in and around Ganges R.
and Ramganga river (tributary of Ganga).
Mains Link:
 Discuss the roles and functions of NMCG.
 Write a note on efforts taken up by Government of India for the conservation of river Ganga.

NOVEMBER, 2022

Page 719 of 719