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GS Paper: GS3

  • How to keep inflation under control

    Context

    The economy now seems to be largely out of the shadow of Covid-19, and only a notch better than in 2019-20. But the big question remains: can India rein in the raging inflation that is at 7.8 per cent (CPI for April 2022), with food CPI at 8.4 percent, and WPI at more than 15 per cent?

    Need for bold steps on three fronts to tackle inflation

    • Unless bold and innovative steps are taken at least on three fronts, GDP growth and inflation both are likely to be in the range of 6.5 to 7.5 per cent in 2022-23.
    • 1] Tightening of loose monetary policy: The Reserve Bank of India (RBI) is mandated to keep inflation at 4 per cent, plus-minus 2 per cent.
    • The RBI has already started the process of tightening monetary policy by raising the repo rate, albeit a bit late.
    • It is expected that by the end of 2022-3, the repo rate will be at least 5.5 per cent, if not more.
    • It will still stay below the likely inflation rate and therefore depositors will still lose the real value of their money in banks with negative real interest rates.
    • That only reflects an inbuilt bias in the system — in favour of entrepreneurs in the name of growth and against depositors, which ultimately results in increasing inequality in the system.
    • 2] Prudent fiscal policy: Fiscal policy has been running loose in the wake of Covid-19 that saw the fiscal deficit of the Union government soar to more than 9 per cent in 2020-21 and 6.7 per cent in 2021-22, but now needs to be tightened.
    • Government needs to reduce its fiscal deficit to less than 5 per cent, never mind the FRMB Act’s advice to bring it to 3 per cent of GDP.
    • However, it is difficult to achieve when enhanced food and fertiliser subsidies, and cuts in duties of petrol and diesel will cost the government at least Rs 3 trillion more than what was provisioned in the budget.
    • 3] Rational trade policy: Export restrictions/bans go beyond agri-commodities, even to iron ore and steel, etc. in the name of taming inflation.
    • But abrupt export bans are poor trade policy and reflect only the panic-stricken face of the government.
    • A more mature approach to filter exports would be through a gradual process of minimum export prices and transparent export duties for short periods of time, rather than abrupt bans, if at all these are desperately needed to favour consumers.
    • Liberal import policy: A prudent solution to moderate inflation at home lies in a liberal import policy, reducing tariffs across board.

    Way forward

    • If India wants to be atmanirbhar (self-reliant) in critical commodities where import dependence is unduly high, it must focus on two oils — crude oil and edible oils.
    • In crude oil, India is almost 80 per cent dependent on imports and in edible oils imports constitute 55 to 60 per cent of our domestic consumption.
    • In both cases, agriculture can help.
    • Ethanol production: Massive production of ethanol from sugarcane and maize, especially in eastern Uttar Pradesh and north Bihar, where water is abundant and the water table is replenished every second year or so through light floods, is the way to reduce import dependence in crude oil.
    • Palm plantation: In the case of edible oils, a large programme of palm plantations in coastal areas and the northeast is the right strategy.

    Conclusion

    We need to invest in raising productivity, making agri-markets work more efficiently.

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  • E-Waste Recycling in India

    Attero Recycling, one of India’s largest electronic waste management companies, is set to invest close to $1 billion in expanding their electronic waste recycling facilities in India.

    E-waste Management: A tricky task

    • E-waste management is a complicated process given the multitude of actors that are involved in the process.
    • The major stakeholders in the value chain include importers, producers/manufacturers, retailers (businesses/government/others), consumers (individual households, businesses, government and others), traders, scrap dealers, dissemblers/dismantlers and recyclers.
    • To critically assess each in the different stages of processing, it is important to understand the e-waste value chain.
    • The process involves four stages: generation, collection, segregation and treatment/disposal.

    India’s regulatory ecosystem

    • Indian electronics sector boomed in the last decade.
    • Increased production and penetration of imported electronics items led to an accelerated e-waste generation that necessitated regulatory control over the sector.
    • India has Electronic Waste (Management and Handling) Rules 2011 in place since . Its scope was expanded in 2016 and 2018 through amendments.

    Provisions of the 2011 Rules

    • To streamline e-waste management, the Government introduced Extended Producer Responsibility (EPR) whereby producers were required to collect and recycle electronic items.
    • Since manufacturers were incurring the disposal cost, their designs would incorporate less toxic and easily recyclable materials, thereby reducing input material requirements.

    Inherent flaws in Implementation

    • Recycling: Less than five percent of the waste is treated through formal recycling facilities.
    • Informal sector: The rest is handled by the informal sector with very little enforcement of environmental and occupational safety norms.
    • Weak Regulations: A deeper analysis revealed that the EPR regulations in India were not quantified through collection or recycling targets as in other countries with better implementation framework and mechanisms.
    • Lack of incentivization: In the absence of targets, producers had little incentive to ensure the collection of their used products.

    Current scenario and issues in e-waste recycling

    • Crude and Scrappage: As of today, some 95% of e-waste is managed by the informal sector which operates under inferior working conditions and relies on crude techniques for dismantling and recycling.
    • Infrastructure lacunae: Another important issue is the lack of sufficient metal processing infrastructure which is why recyclers have to export materials to global smelters.
    • Price competencies: As aggregators are mostly informal, they demand up-front cash payments.
    • Bloomed informal network: The informal network is well-established and rests on social capital ties that PROs have yet to establish and are hence insulated from reaching the viable number of aggregators.
    • Policy failure: Policy changes have tried repeatedly to formalize the sector, but issues of implementation persist on the ground.

    Way forward

    • Effective design: Since India is highly deficient in precious mineral resources, there is a need for a well-designed, robust and regulated e-waste recovery regime that would generate jobs and wealth.
    • Consumer responsibility: The consumers must responsibly consume the product for its useful life and then weigh between the chances of repair or disposal with utmost consciousness towards the environment.
    • Recyclable products: On the supply side, e-waste can be reduced when producers design electronic products that are safer, and more durable, repairable and recyclable.
    • Reuse: Manufacturers must reuse the recyclable materials and not mine rare elements unnecessarily to meet new production.
    • Commercial recycling: Rather than hoping that informal recyclers become formal it would be more feasible for companies and the state to design programs ensure e-waste easily makes its way to proper recyclers.

     

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  • Keep ESZ of 1 Km around Forests: SC

    The Supreme Court has directed that every protected forest, national park and wildlife sanctuary across the country should have a mandatory eco-sensitive zone (ESZ) of a minimum one km starting from their demarcated boundaries.

    Why such move?

    • The purpose of declaring ESZs around national parks, forests and sanctuaries is to create some kind of a “shock absorber” for the protected areas.
    • These zones would act as a transition zone from areas of high protection to those involving lesser protection.

    What are the Eco-sensitive Zones (ESZs)?

    • Eco-Sensitive Zones (ESZs) or Ecologically Fragile Areas (EFAs) are areas notified by the MoEFCC around Protected Areas, National Parks and Wildlife Sanctuaries.
    • The purpose of declaring ESZs is to create some kind of “shock absorbers” to the protected areas by regulating and managing the activities around such areas.
    • They also act as a transition zone from areas of high protection to areas involving lesser protection.

    How are they demarcated?

    • The Environment (Protection) Act, 1986 does not mention the word “Eco-Sensitive Zones”.
    • However, Section 3(2)(v) of the Act, says that Central Government can restrict areas in which any industries, operations or processes or class of industries, operations or processes shall be carried out or shall not, subject to certain safeguards.
    • Besides Rule 5(1) of the Environment (Protection) Rules, 1986 states that central government can prohibit or restrict the location of industries and carrying on certain operations or processes on the basis of certain considerations.
    • The same criteria have been used by the government to declare No Development Zones (NDZs).

    Defining its boundaries

    • An ESZ could go up to 10 kilometres around a protected area as provided in the Wildlife Conservation Strategy, 2002.
    • Moreover, in the case where sensitive corridors, connectivity and ecologically important patches, crucial for landscape linkage, are beyond 10 km width, these should be included in the ESZs.
    • Further, even in the context of a particular Protected Area, the distribution of an area of ESZ and the extent of regulation may not be uniform all around and it could be of variable width and extent.

     

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  • What is D2M Technology?

    The Department of Telecommunications (DoT) and India’s public service broadcaster Prasar Bharati are exploring ‘direct-to-mobile’ (D2M) broadcasting.

    What is D2M Technology?

    • The technology is based on the convergence of broadband and broadcast, using which mobile phones can receive terrestrial digital TV.
    • It would be similar to how people listen to FM radio on their phones, where a receiver within the phone can tap into radio frequencies.
    • Using D2M, multimedia content can also be beamed to phones directly.

    Benefits of D2M

    • It allows broadcasting video and other forms of multimedia content directly to mobile phones, without needing an active internet connection.
    • It promises to improve consumption of broadband and utilisation of spectrum.

    Why need D2M?

    • The idea behind the technology is that it can possibly be used to directly broadcast content related to citizen-centric information.
    • It can be further used to counter fake news, issue emergency alerts and offer assistance in disaster management, among other things.
    • Apart from that, it can be used to broadcast live news, sports etc. on mobile phones.
    • More so, the content should stream without any buffering whatsoever while not consuming any internet data.

    What could be the consumer and business impact of this?

    • For consumers, a technology like this would mean that they would be able to access multimedia content from Video on Demand (VoD) or Over The Top (OTT) content platforms.
    • This will be without having to exhaust their mobile data, and more importantly, at a nominal rate.
    • The technology will also allow people from rural areas, with limited or no internet access, to watch video content.
    • For businesses, one of the key benefits of the technology is that it can enable telecom service providers to offload video traffic from their mobile network onto the broadcast network.
    • It thus helps them to decongest valuable mobile spectrum.
    • This will also improve usage of mobile spectrum and free up bandwidth which will help reduce call drops, increase data speeds etc.

    What is the government doing to facilitate D2M technology?

    • The DoT has set up a committee to study the feasibility of a spectrum band for offering broadcast services directly to users’ smartphones.
    • Band 526-582 MHz is envisaged to work in coordination with both mobile and broadcast services.
    • DoT has set up a committee to study this band.
    • At the moment, this band is used by the Ministry of Information & Broadcasting across the country for TV transmitters.

    What are the possible challenges to the technology’s rollout?

    • Bringing key stakeholders like mobile operators onboard will be the biggest challenge in launching D2M technology on a wide scale.
    • A mass roll out of the technology will entail changes in infrastructure and some regulatory changes.

     

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  • GST Council must uphold fiscal federalism

    Context

    The recent ruling of the Supreme Court held that the states were free to use means of persuasion ranging from collaboration to contestation.

     Simultaneous or concurrent powers under Article 246A

    • Article 246A confers simultaneous or concurrent powers on Parliament and the state legislatures to make laws relating to GST.
    • This article is in sharp contrast to the constitutional scheme that prevailed till 2017.
    • It clearly demarcated taxing powers between the Centre and states with no overlaps.
    • After 2017, several central and state levies were subsumed into GST.
    • Each state was to have its own GST Act, all of them being almost identical to the Central GST Act.
    • Inter-state supplies and imported goods are liable to IGST.

    Composition of GST Council

    • The GST Council has the Union finance minister as the chairperson and the Union minister of state in charge of revenue or finance as a member.
    • Centre has one-third voting power, 31 states (including two Union Territories) share the remaining two-thirds of the vote.
    • The GST Council has a total of 33 members.
    • Out of a total of 33 votes, 11 belong to the Centre and 22 votes are shared by 31 states/UT, with each state/UT having a 0.709 vote.
    • Any decision of the GST Council requires a three-fourth majority or a minimum of 25 votes.
    • As the Centre has 11 votes, it requires an additional 14 votes.
    • Unlike so many statutes, Article 279A has made no provision to make the decision of the majority binding on the dissenting states.
    •  Paragraph 2.73 of the Select Committee Report on the 122nd Constitution (Amendment) Bill, 2014, noted that this voting pattern was to maintain a fine balance as, in a federal constitution, the dominance of one over the other was to be disallowed.

    Role of GST Council

    • Under Article 279A, the GST Council has to make “recommendations” on various topics including the tax rate and exemptions.
    • The Union of India argued that the “constitutional architecture” showed that Articles 246A and 279A, when read together, made the GST Council the ultimate policy-making and decision-making body for framing GST laws.
    • The GST Council was unique and incomparable to any other constitutional body and its recommendations would override the legislative power of Parliament and state legislatures.
    • Neither of them could legislate on GST issues independent of the recommendations of the GST Council.
    • The argument went further: On a combined reading of Article 279A, the provisions of the IGST and CGST Acts and the recommendations of the GST Council were transformed into legislation.
    • The Supreme Court rightly noted that several sections in the state GST laws, CGST and in IGST, cast a duty even on dissenting states to issue notifications to implement the recommendations of the GST Council.

    Observations on federalism

    • Delving into legislative history, the court ruled that a draft Article 279B, which provided for a GST Disputes Settlement Authority, was omitted because it would have effectively overridden the sovereignty of Parliament and the state legislatures, and diminished the fiscal autonomy of the states.
    • It was desirable, the Court said, to have some level of friction, some amount of state contestation, some deliberation-generating froth in our democratic system.
    • Putting to rest any controversy, the court held that the recommendations of the GST Council had only a persuasive value.
    • To regard them as binding edicts would disrupt fiscal federalism because both the Union and states were conferred equal power to legislate on GST.
    • Rule-making power bound by recommendations of GST Council: The Court held that the state governments and Parliament, while exercising their rule-making powers under the provisions of the State GST Acts, CGST & IGST Acts, are bound by the recommendations of the GST Council.
    • States can amend GST laws: But even this did not mean that all recommendations of the GST Council are binding on state legislatures or Parliament to enact primary pieces of legislation on GST.
    • In effect, states can amend their GST laws if they so choose.

    Way forward

    •  If the GST Council meets periodically as mandated and there is active participation of the states in making recommendations, no state will oppose a recommendation that has been carefully deliberated and is in the national interest.

    Conclusion

    Indeed, there is little chance of cracks developing in the GST edifice as long as the spirit of cooperative and collaborative federalism prevails.

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  • UAPA

    The Supreme Court recently put freeze on sedition proceedings under the Section 124A (sedition law) of the IPC for persons who have also been charged under the Unlawful Activities (Prevention) Act (UAPA) of 1967 in the same case or separately.

    What is the news?

    • This freeze has rejected bails for some journalist and JNU activists who also face charges under the UAPA (for anti-India sloganeering and activites).
    • Now they have been accused of making anti-national activities during the Delhi Riots.

    Why is UAPA significant?

    • An amendment made in 2019 has made the Act even more powerful.
    • Now it can designate individuals, and not just associations, as ‘terrorists’.

    Unlawful (Activities) Prevention Act (UAPA)

    • The UAPA is aimed at effective prevention of unlawful activities associations in India.
    • Its main objective was to make powers available for dealing with activities directed against the integrity and sovereignty of India
    • It is an upgrade on the Terrorist and Disruptive Activities (Prevention) Act TADA, which was allowed to lapse in 1995 and the Prevention of Terrorism Act (POTA) was repealed in 2004.
    • It was originally passed in 1967 under the then Congress government led by former Prime Minister Indira Gandhi.
    • Till 2004, “unlawful” activities referred to actions related to secession and cession of territory. Following the 2004 amendment, “terrorist act” was added to the list of offences.

    Major feature: Designation of Terrorists

    • The Centre had amended UAPA, 1967, in August 2019 to include the provision of designating an individual as a terrorist.
    • Before this amendment, only organisations could be designated as terrorist outfits.
    • Section 15 of the UAPA defines a “terrorist act” as any act committed with intent to threaten or likely to threaten the unity, integrity, security, economic security, or sovereignty of India or with intent to strike terror or likely to strike terror in the people or any section of the people in India or in any foreign country.
    • The original Act dealt with “unlawful” acts related to secession; anti-terror provisions were introduced in 2004.

    Who makes such designation?

    • The UAPA (after 2019 amendment)seeks to empower the central government to designate an individual a “terrorist” if they are found committing, preparing for, promoting, or involved in an act of terror.
    • A similar provision already exists in Part 4 and 6 of the legislation for organizations that can be designated as a “terrorist organisations”.

    How individuals are declared terrorists?

    • The central government may designate an individual as a terrorist through a notification in the official gazette, and add his name to the schedule supplemented to the UAPA Bill.
    • The government is not required to give an individual an opportunity to be heard before such a designation.
    • At present, in line with the legal presumption of an individual being innocent until proven guilty, an individual who is convicted in a terror case is legally referred to as a terrorist.
    • While those suspected of being involved in terrorist activities are referred to as terror accused.

    What happens when an individual is declared a terrorist?

    • The designation of an individual as a global terrorist by the United Nations is associated with sanctions including travel bans, freezing of assets and an embargo against procuring arms.
    • The UAPA, however, does not provide any such detail.
    • It also does not require the filing of cases or arresting individuals while designating them as terrorists.

    Removing the terrorist tag

    • The UAPA gives the central government the power to remove a name from the schedule when an individual makes an application.
    • The procedure for such an application and the process of decision-making will is decided by the central government.
    • If an application filed by an individual declared a terrorist is rejected by the government, the UAPA gives him the right to seek a review within one month after the application is rejected.
    • The central government will set up the review committee consisting of a chairperson (a retired or sitting judge of a High Court) and three other members.
    • The review committee is empowered to order the government to delete the name of the individual from the schedule that lists “terrorists” if it considers the order to be flawed.
    • Apart from these two avenues, the individual can also move the courts to challenge the government’s order.

     

     

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  • International Liquid Mirror Telescope (ILMT)

    The four-meter International Liquid Mirror Telescope (ILMT) saw the first light recently, gazing out from its vantage on Devasthal, a hill in Uttarakhand.

    What is the ILMT?

    • The telescope has been built by a collaboration of scientists from Canada, Belgium and India.
    • It is located at an altitude of 2,450 metres on the Devasthal Observatory campus of the Aryabhata Research Institute of Observational Sciences (ARIES) in Nainital district.
    • A large pool of mercury placed in a vessel is spun around so fast that it curves into a parabolic shape. Since mercury is reflective, this shape helps in focusing the reflected light.
    • Nearly 50 litres of mercury, weighing close to 700 kilograms, is spun hard to form a paraboloid mirror of just 4 mm thickness and a diameter of about 4 metres.
    • A thin sheet of mylar protects the mercury from the wind.
    • Once it starts making observations, the telescope will collect gigabytes of data, which will need to be analysed using artificial intelligence and machine learning (AI and ML) tools.

    It’s utility

    • The telescope will make sky surveys possible and obtain images that can help observe transient phenomena.
    • It will help analyse events such as supernovae and record the presence of space debris or meteorites — basically, watch the skies.

    What is the first image?

    • The first image made by the telescope consisted of several stars and a galaxy, NGC 4274, which is 45 million light years away.
    • The telescope, having a primary mirror that is liquid, cannot be turned and pointed in any direction.
    • It “stares” at the zenith and watches the sky as the earth rotates, thereby giving a view of different objects.
    • This property can be used to scan and survey the sky, and observe transients and moving objects such as meteorites.
    • It will work in tandem with the existing 3.6-metre Devasthal Optical Telescope.

     

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  • Posidonia Australis: World’s Largest Plant

    The world’s largest plant has recently been discovered off the West Coast of Australia: a seagrass 180 km in length.

    Posidonia australis

    • The ribbon weed, or Posidonia australis, has been discovered in Shark Bay by a group of researchers from Flinders University and The University of Western Australia.
    • These researchers have also found that the plant is 4,500 years old, is sterile, has double the number of chromosomes than other similar plants.
    • It has managed to survive the volatile atmosphere of the shallow Shark Bay.

    So how remarkable is this plant’s size?

    • The ribbon weed covers an area of 20,000 hectares.
    • The next on the podium, the second largest plant, is the clonal colony of a quaking Aspen tree in Utah, which covers 43.6 hectares.
    • The largest tree in India, the Great Banyan in Howrah’s Botanical Garden, covers 1.41 hectares.

    If it is so large, how come it has just been discovered?

    • The existence of the seagrass was known, that it is one single plant was not.
    • Researchers were interested in what they then thought was a meadow because they wanted to study its genetic diversity, and collect some parts for seagrass restoration.

    How did it grow, and survive for, so long?

    • Sometime in the Harappan era, a plant took root in the Shark Bay.
    • Then it kept spreading through its rhizomes, overcoming everything in its way, and here we are today.
    • Ribbon weed rhizomes can usually grow to around 35cm per year, which is how the scientists arrived at its lifespan of 4,5000 years.
    • The researchers found that the ribbon weed cannot spread its seeds, something that helps plants overcome environmental threats.
    • Also, Shark Bay sees fluctuations in temperature and salinity and gets a lot of light, conditions challenging for any plant.

    Ecological significance

    • Because seagrass performs a vital role in the environment, and if some of it is hardy, it is good news for everyone in a world threatened by climate change.
    • In India, seagrass is found in many coastal areas, most notably in Gulf of Mannar and Palk Strait.
    • Apart from being home to a variety of small organisms, seagrass trap sediments and prevent water from getting muddy, absorb carbon from the atmosphere, and prevent coastal erosion.

     

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  • Species in news: Eublepharis pictus

    A gecko found in Visakhapatnam in 2017, then thought to belong to a known species, has now been identified as a member of a new species.

    Eublepharis pictus

    • The species, Eublepharis pictus, also known as the Painted Leopard Gecko, has been described in the journal Evolutionary Systematics.
    • Phylogenetic study and morphological comparisons have distinguished it as a new species.
    • It is endemic to the forests of Andhra Pradesh and Odisha.
    • The gecko genus Eublepharis now has 7 species.

    Conservation status

    • The species occurs outside protected areas.
    • Most leopard geckos are killed when encountered.
    • Activists have called for raising awareness about the fact that the species is actually harmless.

     

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  • For India, a lesson in food security from Sri Lanka

    Context

     India needs to have a strategy of self-reliance in basic foods, including edible oils.

    Contrasting cases of Sri Lanka and Saudi Arabia

    • Sri Lanka, a country with 21.5 million population imported dairy products valued at $333.8 million in 2020 and $317.7 million in 2021.
    • The island nation’s imports of whole milk powder (WMP) alone were 89,000 tonnes and 72,000 tonnes in these two years.
    •  The 89,000 tonnes of powder imported in 2020 would have, thus, “produced” almost 2.1 million litres per day (MLPD) equivalent of milk.
    • This is as against the 1.3 MLPD that Sri Lanka produces from its own cows and buffaloes.
    • It translates into an import dependence of over 60 per cent.
    • At the other end, we have Saudi Arabia, home to over 35 million inhabitants (including immigrants) and also the world’s largest vertically integrated dairy company.
    • Almarai Company has six dairy farms producing more than 3.5 MLPD of milk.
    • The animals are sourced from the US and Europe.
    • The entire feed and also forage given to them are procured from abroad.
    • Why is Saudi Arabia taking such pains to produce its own milk?
    • The answer is food security.
    • The Saudis — other Persian Gulf countries have also copied the Almarai model — are prepared to pay any price when it comes to ensuring the availability of basic food like milk.

    Lessons for India: Reducing import dependence on edible oil

    • India annually imports 13.5-14.5 million tonnes of vegetable oils, again roughly 60 per cent of its total consumption.
    •  Low international prices meant that the import bill, though high, fell from $9.85 billion in 2012-13 to $9.67 billion in 2019-20.
    • However, in the last couple of years, retail prices of most oils more than doubled
    • The value of India’s vegetable oil imports surged to a record $19 billion in 2021-22.

    Conclusion

    As a country with a population many times that of Sri Lanka and Saudi Arabia, India needs to have a strategy of self-reliance in basic foods.

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