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GS Paper: GS3

  • How can mRNA vaccines help fight cancer?

    mrna

    The results of a trial of an experimental cancer vaccine built on the mRNA (messenger ribonucleic acid) platform, made by Moderna and MSD (Merck&Co.), have shown promising results.

    What is mRNA?

    mrna

    • Messenger RNA (mRNA) is a single-stranded RNA (Ribo Nucleic Acid) molecule that is complementary to one of the DNA strands of a gene.
    • The mRNA is an RNA version of the gene that leaves the cell nucleus and moves to the cytoplasm where proteins are made.
    • During protein synthesis, an organelle called a ribosome moves along the mRNA, reads its base sequence, and uses the genetic code to translate each three-base triplet, or codon, into its corresponding amino acid.

    What are mRNA vaccines?

    • mRNA vaccines work by introducing a piece of mRNA that corresponds to a viral protein, usually a small piece of a protein found on the virus’s outer membrane.
    • Individuals who get an mRNA vaccine are not exposed to the virus, nor can they become infected with the virus by the vaccine.
    • As part of a normal immune response, the immune system recognizes that the protein is foreign and produces specialized proteins called antibodies.
    • Antibodies help protect the body against infection by recognizing individual viruses or other pathogens, attaching to them, and marking the pathogens for destruction.
    • Once produced, antibodies remain in the body, even after the body has rid itself of the pathogen, so that the immune system can quickly respond if exposed again.

    How does the vaccine work?

    • The personalized cancer vaccine uses the same messenger-RNA technology that was used to produce the COVID vaccine.
    • It allows the body’s immune system to seek and destroy cancerous cells, in this case melanoma, but with the hope that it could lead to new ways to fight other types of cancers too.

    Why is it a significant feat?

    • The cancer vaccine showed a 44% reduction in the risk of dying of cancer or having the cancer progress.
    • As a personalized cancer vaccine, it is tailor-made for every patient.
    • As a consequence, it is expected to be very expensive to make.
    • But oncologists across the world have welcomed this as an exciting new opportunity in cancer care.

     

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  • A milestone in fusion energy

    fusion

    Context

    • For more than nine decades scientists have tried to replicate the process that produces energy for the sun and the stars fusion. On Tuesday, researchers at the National Ignition Facility (NIF) in California, USA, announced a milestone in this endeavor.

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    fusion

    What is the research?

    • Merged two nuclei to produce a heavier nucleus: They merged two nuclei to produce a heavier nucleus. Their reactor produced about 1.5 times more energy than what was used in the process. In all the earlier attempts to harness the power of fusion, the reactors used up more energy than what was produced.
    • It will take at least two decades to be pioneered: But scientists say that it will be at least two decades before the process pioneered in the California laboratory can be scaled up.
    • Still a great leap where the world is in search of green technologies: Even then, in a world desperately searching for technologies that can power the developmental needs of nations without adding to the GHG load, the breakthrough at NIF has generated excitement.

    What is Fusion?

    • Fusion works by pressing hydrogen atoms into each other with such force that they combine into helium, releasing enormous amounts of energy and heat.
    • This process occurs in our Sun and other stars.
    • Creating conditions for fusion on Earth involves generating and sustaining a plasma.
    • Plasmas are gases that are so hot that electrons are freed from atomic nuclei.

    fusion

    What is Fusion Energy?

    • The process releases energy because the total mass of the resulting single nucleus is less than the mass of the two original nuclei.
    • The leftover mass becomes energy.

    Why is it perceived as energy of the future?

    • Carbon free: Fusion Reactions could one day produce nearly limitless, carbon-free energy, displacing fossil fuels and other traditional energy sources.
    • Efficient: Net energy gain has been an elusive goal because fusion happens at such high temperatures and pressures that it is incredibly difficult to control.
    • Clean: Unlike other nuclear reactions, it doesn’t create radioactive waste.

    fusion

    Why it is considered as significant research, though it will take at least two decades to be commercialized?

    • Countries are shifting towards renewable energies: Several countries are shifting to renewable energies to meet their international climate-related commitments. Yet, power generation currently is responsible for 25-30 per cent of global GHG emissions.
    • Unstable nature of renewables: The inherently unstable nature of renewables means that countries find it very difficult to jettison fossil-fuel energy sources.
    • Nuclear energy is relatively cleaner: Conventionally-produced nuclear energy that uses fission technology is relatively cleaner. But accidents at Chernobyl in 1986 and Fukushima in 2011 have raised serious questions over the safety of fission-powered plants. According to the IEA’s best-case scenario, the world’s nuclear energy generation capacity is likely to double by 2050 compared to 2020.

    Conclusion

    • The global body has repeatedly flagged concerns about the efficacy of the nuclear reactors by and large in the US and Europe given that about two-thirds of them have been in operation for more than 30 years. It has also maintained that the realisation of the best-case scenario would require significant investments in innovative nuclear technologies.

    Mains question

    Q. Recently researchers at the National Ignition Facility (NIF) in USA tried to replicate the process that produces energy for the sun and the stars fusion, discuss the significance of this research.

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  • Need to ensure that the digital gateways do not become gatekeepers of services

    digital

    Context

    • The ease of living enabled by digital technologies has turned digital innovations into essential services for the common public. Considered a novelty earlier, the internet has become a necessity for most day-to-day affairs.

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    Internet access and restrictions

    • To enable access to the internet, various gateways have come up in the last few decades in the form of telecom service providers, personal computers and smartphones, operating systems, etc.
    • However, when these gateways enable and restrict access to other gateways or networks, the openness of the internet is threatened.
    • They then shift roles from being a facilitator to a regulator, from being a gateway to a gatekeeper. Hence, the need for a code of conduct or regulation arises to keep the playing field level and accessible to all.

    digital

    Analysis: Telecoms and Government

    • Telecom service providers: Telecom companies have been instrumental in providing a gateway to essential communication services such as voice calls, internet data, and text messages.
    • Government measures to regulate telecoms: We have seen governments across the world take measures from time to time to regulate these entities to ensure democratic access for the public. If this code of conduct was not enforced on these gateway providers, the internet would not be what it is today. These providers would have turned into gatekeepers, and the internet would have been controlled by them, thwarting innovation and its democratic expansion.
    • Code of conduct cannot catch up the pace of emerging digital tech: With the rate at which digital technologies are evolving, the code of conduct and regulations can’t catch up with the new gateway providers that are emerging. One such example is distribution platforms for smartphone applications.
    • Benchmarks set by bigtechs helps to bring some hygiene in smartphone apps: The two prominent operating systems emerging for smartphones, Google and Apple, enjoy a lion’s share of the app store market. They brought in good practices to ensure basic hygiene for smartphone applications, maintained quality benchmarks for the content on their operating systems, and safeguarded the interests of their users.
    • Lack of full proof regulation would be a slippery slope: Though, without proper regulations to oversee how they decide on what should be weeded and whose interests should be guarded, it’s a slippery slope.

    Policy on Net Neutrality put forwarded by Indian Government 

    • Enforcing a code of conduct on telecoms: Closer home, another example of the enforcement of this code of conduct on providers was when the Indian government came out with the policy on Net Neutrality which, inter-alia, stipulates that telecom networks should be neutral to all the information being transmitted through it.
    • Meaning of Net Neutrality: Networks should treat all communication passing through them equally, independent of their content, application, service, device, sender, or recipient address. Adopting Net Neutrality ensured that we took a democratic stance against Big Tech.

    digital

    Questionable practices of distribution platforms

    • Practices without consent of its users: Various practices range from restrictions on payment gateways, advertising choices, app policies and various other aspects of an application or business that could be considered discriminatory in both principle and practice.
    1. For instance, a case of Goggle’s Update: Recently a report placed before the Competition Commission of India found Google Play Store’s payments policy “unfair and discriminatory”. As per an update in Google’s Play Store billing policy in September 2020, all applications on its platform were mandated to use its payment services for any kind of in-app payments or subscriptions.
    2. Similar case of Apple’s appstore: Similar concerns have been raised for Apple’s App Store, with both platforms said to be charging up to 30 per cent commission on payments processed.
    • Market dominance and unilateral control over smartphone apps by the bigtechs: Google and Apple dominate the global market share of smartphone operating systems (OS). This has enabled them to garner unilateral control over the publishing of smartphone applications on their OS.
    • Developers are forced to bend to the diktats of these bigtech gatekeepers: Bigtechs force developers to make changes to their applications or resort to using their proprietary advertising engines if they wish their applications to see the light of day. As is evident from the overnight change in Google’s billing policy, various smartphone application-dependent businesses and developers continue to remain vulnerable to such internal business policy changes on these platforms.

    European Union’s Digital Markets Act (DMA) sets an example

    • Recognising these concerns: The European Union has recently enacted the Digital Markets Act; it is expected to be implemented by early 2023.
    • Aims to keep digimarket open for competition: The Digital Markets Act regulation aims to keep digital markets innovative and open to competition, through ex-ante regulation.
    • Prohibit anti-competitive practices: The DMA will prohibit the implementation of the most harmful anti-competitive practices by the largest digital platforms.
    • Objective is to maintain balance: The objective is to balance the relationship between these platforms that control access to digital markets and the companies that offer their services there.

    Conclusion

    • The Indian government has taken a huge leap forward in maintaining its sovereignty through the path-breaking and disruptive digital public goods it has created. Aadhaar, UPI, DigiLocker, and CoWIN are just a few names that adorn this list. However, there is still a wide dependence on various digital offerings enabled by multinational Big Tech companies. It is the need of the hour for the government to devise appropriate regulations to ensure a level playing field and not let the innovating gateways turn into tyrannical gatekeepers.

    Mains Question

    Q. India is the largest consumer of wireless internet. Analyze the role of big tech service providers in this and the role of government in ensuring a level playing field for all.

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  • Rupee Settlement Mechanism draws interest from more nations

    rupee

    India’s rupee trade settlement mechanism, a means of using rupees instead of dollars and other big currencies for international transactions, is attracting interest from more countries.

    More countries are interested

    • Tajikistan, Cuba, Luxembourg and Sudan have begun talking to India about using the mechanism.
    • They have shown interest in opening special rupee accounts, called vostro accounts.
    • Opening of these accounts needs approval from the Reserve Bank of India.
    • It has already been used by Russia following the imposition of sanctions on Moscow over the Ukraine war.

    Rupee Settlement System for International Trade

    • Banks acting as authorized dealers for such transactions would have to take prior approval from the regulator to facilitate this.
    • All exports and imports under the invoicing arrangement may be denominated and invoiced in Rupee.
    • The exchange rate between the currencies of the two trading partner countries may be market determined.
    • Exporters and importers can now use a Special Vostro Account linked to the correspondent bank of the partner country for receipts and payments denominated in rupees.
    • These accounts can be used for payments for projects and investments, import or export advance flow management, and investment in Treasury Bills subject to Foreign Exchange Management Act, 1999 (FEMA).
    • Also, the bank guarantee, setting-off export receivables, advance against exports, use of surplus balance, approval process, documentation, etc., related aspects would be covered under FEMA rules.

    Benefits of such a mechanism

    • Trade facilitation: This will also facilitate trade with countries like Russia which are facing sanctions.
    • FOREX savings: India imports more than it exports so the country will also save foreign currency under the new arrangement.
    • Rupee appreciation: The rupee is at a historic low against the dollar. It will also help stabilize rupee.
    • Mitigating war impact: Payments had become a pain point for exporters immediately after the Russia-Ukraine war broke out, especially after Russia was cut off from the SWIFT payment gateway.
    • Convertibility easing: We see this as a first step towards 100% convertibility of rupee.
    • Energy security: It will also help buy discounted crude oil from Russia, which now accounts for 10% of all imported crude.
    • Export promotion: As such, the new mechanism will help India promote its exports.

    Which countries would prefer this system?

    • War mongering Russia: For now, it looks like trade settlements in rupee will be limited to countries like Russia and Iran who are facing sanctions from the West
    • Bankrupt Sri Lanka: SL is going through economic turmoil and India has been consistently extending lines of credit to SL.
    • Immediate neighbors: Other countries may include immediate neighbors of India.

    Rupees over Dollars: Why countries would prefer Rupees?

    • At a very simplistic level, this is like two Indians deciding to use an alternative mode of exchange that they have come up with, instead of using rupees.
    • In other terms, this is similar to the barter system.
    • The main reason for countries to want to trade with India in rupees is this:
    1. USD has been going through a phase of strength against most currencies in the world
    2. Strong USD performance has essentially made imports expensive for most countries
    3. Sri Lanka, which is going through one of its worst economic crises in decades, is a glaring example of a country in which the economy has come to a halt due to a drastic fall in forex reserves
    • While the Sri Lankan Rupee has declined over 83 percent against the US Dollar, its fall against the Indian Rupee has been lower at 70 percent.
    • So instead of paying 83 percent more to make purchases in USD, Sri Lanka can pay in Indian Rupees and save some money.

    Challenges

    • Trade surplus countries’ preference: The question that RBI and the Indian government will have to answer is this – why would countries with a trade surplus with India want to trade in rupees?
    • Negative trade balance: China had a $73-billion trade surplus with India in 2021-22 – that is, Indian imports from China exceeded its exports to China by $73 billion.
    • Idle money lying useless: If China were to trade with India in rupees, it would have Indian rupees worth $73 billion (about ₹5.77 lakh crore) sitting idle in its Rupee Vostro accounts in an Indian bank.
    • Few countries interested: Countries whose exports to India are more than imports, will not be too enthusiastic to trade in rupees, especially if the difference is huge as in the case of China.

     

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  • What is DNA Fingerprinting?

    dna

    Delhi Police has established identity of a victim of brutal murder and mutilation by DNA fingerprinting.

    What is DNA fingerprinting?

    • DNA fingerprinting was first developed in 1984 by Alec Jeffreys in the UK, after Jeffreys discovered that no two people could have the same DNA sequence.
    • Within three years of the discovery, the UK achieved the world’s first conviction based on DNA evidence in a case of rape and murder.

    How is DNA fingerprinting done?

    • Each person’s DNA, except for identical twins, is unique.
    • By analyzing selected DNA sequences (called loci), a crime laboratory can develop a profile to be used in identifying a suspect.
    • DNA can be extracted from many sources, such as hair, bone, teeth, saliva, and blood.
    • Because there is DNA in most cells in the human body, even a minuscule amount of bodily fluid or tissue can yield useful information.
    • Samples may even be extracted from used clothes, linen, combs, or other frequently used items.

     

    Deoxyribonucleic Acid (DNA)

    • DNA is the hereditary material in humans and almost all other organisms. Nearly every cell in a person’s body has the same DNA.
    • Most DNA is located in the cell nucleus (where it is called nuclear DNA), but a small amount of DNA can also be found in the mitochondria (where it is called mitochondrial DNA or mtDNA).
    • Mitochondria are structures within cells that convert the energy from food into a form that cells can use.
    • The information in DNA is stored as a code made up of four chemical bases: adenine (A), guanine (G), cytosine (C), and thymine (T).
    • Human DNA consists of about 3 billion bases, and more than 99 percent of those bases are the same in all people.
    • The order, or sequence, of these bases determines the information available for building and maintaining an organism, similar to the way in which letters of the alphabet appear in a certain order to form words and sentences.

    How it is used in criminal investigation?

    • DNA evidence is used to solve crimes in two ways:
    1. If a suspect is known, that person’s DNA sample can be compared to biological evidence found at a crime scene to establish whether the suspect was at the crime scene or whether they committed the crime.
    2. If a suspect is not known, biological evidence from the crime scene can be analyzed and compared to offender profiles in existing DNA databases to assist in identifying a suspect.
    • Beyond its accuracy, DNA fingerprinting can also sift through crime scene evidence in different ways, previously unavailable to investigators.
    • For instance, advanced DNA fingerprinting can make separate prints of various individuals even from a sample mixture found at the crime scene — this is of help during gang rape investigations as each perpetrator can be individually identified.

    DNA fingerprinting in India

    • By 1988, Lalji Singh, who had been in the UK from 1974 to 1987 on a Commonwealth Fellowship, developed DNA fingerprinting for crime investigations in Hyderabad.
    • Today, Lalji Singh, who passed away in 2017, is known as “the father of DNA fingerprinting in India.”
    • In 1989, DNA fingerprinting was first used in a case by the Kerala Police.
    • By the early 1990s, the technology had begun to be used for establishing paternity, and to link criminals and identify victims in sensational crimes.
    • From the 2000s onwards, the technology became a staple in rape cases where vaginal swab samples were matched with semen samples from suspects.

    Challenges with DNA fingerprinting in India

    • It is vital to ensure that the DNA of the investigators does not get mixed with that of the victims or the suspects.
    • Thus, picking up samples from a crime scene with sterile tools and storing samples in a proper manner are crucial for the evidence to stand a judicial test.
    • While India has rules and guidelines regarding this, India’s police forces have a lot of catching up to do with counterparts overseas.
    • While central agencies such as CBI have the expertise to ensure that crime scenes are protected and correct procedure is followed, state police forces are inadequately trained or fully equipped.

    Issues with such technology

    • The problem is not limited to the police awareness.
    • The capacity for DNA fingerprinting in the country itself is lacking.
    • DNA fingerprinting is available only at a few places — Maharashtra, West Bengal, Delhi, Hyderabad and Chandigarh.
    • Advanced practices in the technology are limited to the Centre for DNA Fingerprinting and Diagnostics (CDFD) in Hyderabad.

     

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  • Kerala’s 5 agricultural products get GI Tag

    gi

    Five agricultural products of Kerala have been granted Geographical Indication (GI) status.

    Which are the 5 GI products?

    • These are the latest Geographical Indications that have been registered-
    1. Attappady Attukombu Avara: It cultivated in the Attappady region of Palakkad, is curved like a goat’s horn as its name indicates. Its higher anthocyanin content compared to other dolichos beans imparts violet colour in the stem and fruits. Anthocyanin is helpful against cardiovascular diseases along with its antidiabetic properties. Other than this, calcium, protein, and fibre content are also high. The higher phenolic content of imparts resistance against pest and diseases, making the crop suitable for organic cultivation.
    2. Attappady Thuvara: It is having seeds with white coat. Compared to other red grams, Attappady Thuvara seeds are bigger and have higher seed weight. This delicious red gram, which is used as vegetable and dal, is rich in protein, carbohydrate, fibre, calcium and magnesium.
    3. Kanthalloor-Vattavada Veluthulli (garlic): Compared to the garlic produced in other areas, this garlic contains higher amount of sulphides, flavonoids, and proteins. It is rich in allicin, which is effective against microbial infections, blood sugar, cancer, cholesterol, heart diseases, and damages to blood vessels. The garlic cultivated in this area is also rich in essential oil.
    4. Onattukara Ellu and its oil: It is famous for its unique health benefits. Relatively higher antioxidant content in Onattukara Ellu helps in fighting the free radicals, which destroy the body cells. Also, the high content of unsaturated fat makes it beneficial for heart patients.
    5. Kodungalloor Pottuvellari: It is cultivated in Kodungalloor and parts of Ernakulam is consumed as juice and in other forms. This snap melon, which is harvested in summer, is an excellent for quenching thirst. It contains high amount of Vitamin C. Compared to other cucurbits, nutrients such as calcium, magnesium, fibre and fat content are also high in that.
    • The unique features of the products, imparted by the agro-climatic conditions of the geographical area of their production, are the basis for getting a GI tag.

    What are the other GIs tags awarded?

    Adding to the present collection of Geographical Indications (GIs), nine new items, including-

    1. Gamocha of Assam
    2. Tandur red gram of Telangana
    3. Raktsey Karpo apricot of Ladakh, and
    4. Alibag white onion of Maharashtra

     

    Do you know?

    Karnataka and Tamil Nadu are states with the highest number of GI tags, followed by Kerala (35), Uttar Pradesh (34), and Maharashtra (31).

     

    About GI Tag

    • Recognised by the World Trade Organization (WTO), GI is used to denote the geographical territory from where a product, be it agricultural produce, natural product, or manufactured.
    • It conveys the assurance of quality, distinctiveness, and attributes that are unique to that specific geographic region/place of origin.
    • India became a signatory to this convention, when, as a member of WTO, it enacted the Geographical Indications (Registration and Protection) Act, 1999, which came into effect on September 15, 2003.
    • To protect the GI of goods, a GI registry has been established to administer the GI of Goods (Registration and Protection) Act, 1999, under the Controller General of Patents, Designs & Trade Marks.

     

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  • Road ministry notifies new rules on BH Series registration mark for vehicles

    bh series

    The Ministry of Road Transport and Highway has notified new rules to further increase the scope of implementation of the BH series registrations for vehicles.

    What is the update?

    The transport ministry has proposed new rules that would permit transfer of vehicles with BH series registration mark to other persons, who are eligible or ineligible for the getting the series.

    What is Bharat series (BH-series)?

    • There was a procedure of re-registration of a vehicle while moving to another state.
    • A vehicle bearing BH registration mark shall not require assignment of a new registration mark when the owner of the vehicle shifts from one State to another.
    • Format of Bharat series (BH-series) Registration Mark –

    Registration Mark Format:

    1. YY BH #### XX
    2. YY – Year of first registration
    3. BH- Code for Bharat Series
    4. ####- 0000 to 9999 (randomized)
    5. XX- Alphabets (AA to ZZ)

    Why such move?

    • Station relocation occurs with both Government and private sector employees.
    • Such movements create a sense of unease in the minds of such employees with regard to transfer of registration from the parent state to another state.
    • Under section 47 of the Motor Vehicles Act, 1988, a person is allowed to keep the vehicle for not more than 12 months in any state other than the state where the vehicle is registered.

    Who can get this BH series?

    • BH-series will be available on voluntary basis to Defense personnel, employees of Central Government/ State Government/ Central/ State PSUs and private sector companies/organizations.
    • The motor vehicle tax will be levied for two years or in multiple of two.
    • This scheme will facilitate free movement of personal vehicles across States/UTs of India upon relocation to a new State/UT.
    • After completion of the fourteenth year, the motor vehicle tax shall be levied annually which shall be half of the amount which was charged earlier for that vehicle.

     

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  • India’s Current Account Deficit (CAD) Strategy amidst the Global Uncertainty

    Deficit

    Context

    • There seems to be considerable optimism about India’s near-term growth prospects now that the major global energy and commodity shocks have subsided. Even if these shocks have subsided, India still faces one big problem of its large current account deficit (CAD). How will this be managed? It turns out that the answer to both questions lies in one word exports.

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    Deficit

    What is Current Account Deficit (CAD)?

    • A current account is a key component of balance of payments, which is the account of transactions or exchanges made between entities in a country and the rest of the world.
    • This includes a 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.
    • A CAD arises when the value of goods and services imported exceeds the value of exports, while the trade balance refers to the net balance of export and import of goods or merchandise trade.
    • CAD = Trade Deficit + Net Income from Abroad + Net transfers

    What has been the recent trend?

    • Swelling CAD: Over the past year, the post-pandemic normalisation has caused the current account deficit to swell to exceptional proportions.
    • Decline in demand abroad: At home, normalisation has spurred a renewed demand for imported inputs. But abroad, it has had the opposite effect, leading to a decline in demand.
    • India’s import soared while exports fell: Foreign households are no longer demanding so many goods now that the lockdowns that kept them in their houses and the fiscal stimuli that gave them the money to spend have both ended. So, India’s imports have soared just at a time when its merchandise exports have started to fall.
    • Statistics for instance: The difference between the value of goods imported and exported fell to $54.48 million in Q4FY 2021-22 from $59.75 million in Q3 FY2021-22.
    • Service sector is saviour: However, based on robust performance by computer and business services, net service receipts rose both sequentially and, on a year, -on-year basis.

    Future projections

    • Looking ahead, the situation seems set to worsen: Foreign demand will slow further as advanced countries slip into what now seem like inevitable recessions.
    • In the backdrop of recession India’s CAD could widen further: In that case, India’s CAD could widen even further, possibly to four per cent of GDP in 2022-23, double the level that the Reserve Bank of India (RBI) traditionally regards as “safe”.

    Deficit

    Analysis: How should India respond?

    1. Attracting foreign capital inflow: Attract foreign capital inflows worth at least four per cent of GDP.
    • Is this realistic in time of global uncertainty: The world is currently facing unprecedented levels of uncertainty. Two years of the pandemic, now a land war in Europe, inflation and energy crisis in Europe, interest rate hikes in the history of the US Federal Reserve, slowdown in china, etc. In such an uncertain environment, foreign investors prefer to invest in safe assets such as US government bonds rather than emerging markets like India. As a result, India has witnessed large outflows of foreign capital in 2022-23
    1. Deploying RBI’s Forex to pay for imports: If India cannot attract the required amount of capital inflows, the RBI’s foreign exchange reserves could be deployed to pay for imports.
    • Is this strategy sustainable: The country’s reserves are meant to tide the country over short-term problems, such as commodity price spikes. India’s merchandise exports have been structurally weak, stagnating for the past decade, until the pandemic induced a short-lived boom.

    Deficit

    How depreciating rupee could be helpful?

    • Price needs to be adjusted by depreciating rupee: This means that something fundamental needs to change. Ultimately, India’s CAD reflects a mismatch between the demand and supply of foreign exchange. To restore balance, first and foremost, the price needs to adjust, that is, the rupee needs to depreciate.
    • Exporting becomes more profitable: When this happens, exporting becomes more profitable, inducing more and more firms to explore foreign markets. Meanwhile, foreign demand improves, because the rupee depreciation makes India’s products more price-competitive. As a result, exports increase and the CAD falls.
    • Exchange rate depreciation is helpful in sustained growth: The recovery of the Indian economy from the pandemic was largely fuelled by exports. But with exports now declining, this crucial source of growth has now become uncertain for India. Strengthening the export sector is, therefore, critical for sustaining growth.

    Way forward

    1. Allow the rupee to depreciate,
    2. Encourage foreign firms to produce in India by letting them access their supply chains,
    3. Encourage domestic firms to step up to the competition, and
    4. Create a level playing field for all players.

    Conclusion

    • The large CAD, however, is not a short-term problem: It is a long-term problem requiring a long-term solution. By adopting the discussed strategy, India could potentially solve its two most important macroeconomic problems that are reducing the large CAD and securing rapid, sustained growth.

    Mains question

    Q. What is Current account deficit (CAD)? In a time of global uncertainty How India can reduce its large CAD and secure sustained growth. Analyze

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  • [pib] Social Progress Index (SPI) for states and districts

    Economic Advisory Council to Prime Minister (EAC-PM) will release the Social Progress Index (SPI) for states and districts of India on December 20, 2022.

    Social Progress Index (SPI) Report

    • SPI is a comprehensive tool intended to be a holistic measure of the Social Progress made by the country at the national and sub-national levels.
    • The report has been prepared by Institute for Competitiveness, headed by Dr Amit Kapoor and the Social Progress Imperative, headed by Michael Green.
    • It was mandated by Economic Advisory Council to the Prime Minister of India.

    Objectives of the report

    • With state and district-wise rankings and scorecards, the report aims to provide a systematic account of the social progress made at all levels in the country.
    • The report also sheds light on the achievements of the districts that have performed well on the index and the role of the states in achieving social progress.
    • A special section of the report provides an analysis of the Aspirational Districts of India, leading to a broader understanding of the social progress at the grassroots level.
    • The report will act as a critical enabler and tool for policymakers in the coming years for achieving sustained socio-economic growth.

    Components of SPI

    SPI assesses the performance of states and districts on three dimensions of social progress:

    1. Basic Human Needs: It assesses the performance of states and districts in terms of Nutrition and Basic Medical Care, Water and Sanitation, Personal Safety and Shelter.
    2. Foundations of Wellbeing: It evaluates the progress made by the country across the components of Access to Basic Knowledge, Access to Information and Communication, Health and Wellness, and Environmental Quality.
    3. Opportunity: It focuses on aspects of Personal Rights, Personal Freedom and Choice, Inclusiveness, and Access to Advanced Education.

    (This newscard will be updated once the report is published.)

    Need for SPI

    • GDP is not a holistic measure of a nation’s development: It would be incorrect to state that the economic progress is completely divorced from progress made in areas mentioned above.
    • Social outcomes of developmental economics: The primary goal of the SPI is to provide a rigorous tool to benchmark progress and stimulate progress within countries.
    • No single holistic parameter available: Several indicators, like GHI and HDI, go beyond GDP, but none captures social progress as finely as SPI.
    • Doing away with biased reports: India does not display a respectable position in the index, as even the small neighbours like Nepal have a better rank. India is also the lowest rank holder in BRICS.

     

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  • India test-fires Agni-V Ballistic Missile amid LAC heat

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    India successfully carried out the night trials of the Agni V nuclear-capable ballistic missile days after Indian and Chinese troops clashed in Tawang district of Arunachal Pradesh.

    Why in news?

    • It was a midnight test fire.
    • And there are rumours about the increased range and stealth capabilities of Agni-V missile.

    Agni Missiles

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    • Agni missiles are long range, nuclear weapons capable surface to surface ballistic missile.
    • The first missile of the series, Agni-I was developed under the Integrated Guided Missile Development Program (IGMDP) and tested in 1989.
    • After its success, Agni missile program was separated from the IGMDP upon realizing its strategic importance.
    • It was designated as a special program in India’s defence budget and provided adequate funds for subsequent development.

    Variants of Agni missiles

    1. Agni I: It is a Medium Range Ballistic Missile with a Range of 700-800 km.
    2. Agni II: It is also a Medium Range Ballistic Missile with a Range more than 2000 km.
    3. Agni III: It is also an Inter-Medium Range Ballistic Missile with Range of more than 2,500 Km
    4. Agni IV: It is also an Inter-Medium Range Ballistic Missile with Range is more than 3,500 km and can fire from a road mobile launcher.
    5. Agni-V: Currently it is the longest of Agni series, an Inter-Continental Ballistic Missile (ICBM) with a range of over 5,000 km.
    6. Agni- VI: The longest of the Agni series, an Inter-Continental Ballistic Missile (ICBM) with a range of ICBM 11,000–12,000 km.

    Strategic significance of Agni Missiles

    • The success of AGNI missiles is in line with India’s stated policy to have ‘credible minimum deterrence’ that underpins the commitment to ‘No First Use’.
    • What makes Agni 5 agile is that it is a “canisterised” missile. It means that the missile can be launched from road and rail platforms, making it easier for it to be deployed and launched at a quicker pace.
    • The canisterisation also gives the missile a longer shelf life, protecting it from the harsher climatic conditions.
    • While India is among the handful of nations with ICBM capability.
    • The next generation of the missile, Agni VI, under development, is expected to have a range of around 8,000 km.

     

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