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GS Paper: GS3

  • Extending BSF’s powers won’t resolve policing problems, security threats

    Context

    The Union home ministry’s order to extend the jurisdiction of the Border Security Forces (BSF) has caused furore.

    Justification for the order

    • Increased threats: The Taliban’s takeover in Afghanistan has revived serious threats of cross-border infiltration from Pakistan, while China, our other tense neighbour, has been increasingly aggressive over the past year.
    • Change in the jurisdiction: The BSF’s powers have not altered, only its jurisdiction has changed from 15 to 50 kilometres and that is for the purposes of uniformity.

    Issues raised by the order

    • Lack of clarity: That India is facing heightened security threats is undeniable.
    • What is unclear is how the BSF’s extended jurisdiction helps counter these threats.
    • The recent drug seizures in Gujarat’s Adani port were successfully conducted by the customs department and the Directorate of Revenue Intelligence — not by the BSF, despite their jurisdiction depth of 80 kilometres in the state.
    • No need for uniformity: In the security context, arguments about uniformity are patently absurd.
    • There is no uniformity between coastal smuggling in Gujarat, cross-border infiltration in Jammu and Kashmir, smuggling and drone drops in Punjab.
    • Risk of civilian resentment: The order raises the risk of civilian resentment, even clashes, given that the BSF is not trained to operate in residential and/or market areas, it will also undermine the state police forces’ morale even further.
    • Overstretching BSF: The BSF is likely to be overstretched by its new tasks.
    • Once again, that could weaken rather than strengthen the BSF’s security capabilities.

    Tackling illegal migration

    • Curbing illegal migration requires coordinated action between India and its neighbours, first at the political and then at the security level.
    • The administration’s migration policies — the Citizenship Amendment Act, deporting Myanmar refugees even when they were locally welcomed, cancelling Afghan visas have made cooperation more difficult and impacting negatively on border security.
    • To think that the BSF can plug what is a government-to-government policy gap is prone to failure.

    Way forward

    • Coordination: The underlying issue when it comes to tackling both smuggling and infiltration threats is coordination between our security agencies.
    • Police reform: The state police forces have weakened, therefore, the solution lies in putting police reforms on an emergency footing, not in extending the BSF’s jurisdiction.
    • That we have a grave policing problem across India is undeniable.
    • But the answer is not to write them off; it is to insulate them from political misuse while holding them accountable for rule of law lapses.
    • Moreover, to strengthen police capabilities it is vital that other security forces cooperate with local police forces, not bypass them.
    • The BSF has had a relatively good record of local police cooperation thus far.
    • When it comes to cross-border infiltration, intelligence is the key.

    Conclusion

    Strengthening police capabilities, improving coordination between security agencies and cooperation with state law enforcement are needed to address these issues.

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  • Punjab farmers create Bio-Enzymes from Kinnow

    Some farmers in Punjab, especially in the Kinnow belt, have started making Bio-Enzymes (BEs) from this waste fruit — peel and ‘D’ grade, very small kinnows.

    What is a Kinnow?

    • The ‘Kinnow’ is a high yield citrus fruit cultivated extensively in the wider Punjab region of India and Pakistan.
    • It is a year-long duration crop and the main harvesting period is from November-end to March.
    • It looks similar to orange but is smaller in size.

    Agricultural significance of Kinnows

    • Fallen fruit is a major challenge for kinnow farmers in the state as one needs to dig up small pits to bury them, otherwise the fallen fruit rot and invite a fly attack on the healthy fruit still on the plants.
    • But now, some farmers are using this waste kinnow to improve the pH level and soil fertility of their land by making BEs from this waste fruit.

    What are Bio-Enzymes?

    • Chemically, the Bio Enzymes are a mixture of complex organic substances such as proteins, salts and other materials that are by-products of the bacteria/yeast.
    • They produced through fermentation of organic waste including various fruits, vegetable peels and flowers, by mixing in sugar, jaggery/molasses and water.
    • BE’s also have a lot of usage in our daily lives. They can be used as natural cleansers.

    Benefits offered by BEs

    • BEs have a lot of good microbes and one of the major methods which helps overall improvement of our ecology.
    • It helps in mitigating the imbalance occurred due to overuse of chemicals, in our soil, air and water.
    • In a state like Punjab where water table is depleting fast and water contamination is also major issue, BEs can bring the soil back to life.
    • It helps in better water recharging and also stops the contamination of water by improving the health of soil.

     

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  • What is the Lucy Mission?

    The NASA has launched Lucy, the spacecraft on a 12-year cruise to look back into the origins of the solar system through Trojans.

    Lucy Mission

    • Lucy will fly by eight Jupiter asteroids—seven Trojans and one main-belt asteroid — over the next 12 years.
    • It is NASA’s first single spacecraft mission in history to explore so many different asteroids.
    • Lucy will run on solar power out to 850 million kilometers away from the Sun.
    • This makes it the farthest-flung solar powered spacecraft ever, according to NASA.

    What is Jupiter Trojan Asteroids?

    • Simply known as Trojans, they are a large group of asteroids that share Jupiter’s orbit around the Sun.
    • Thousands of such asteroids exist in a gravitationally stable space.
    • The swarms lead and follow the planet Jupiter along its orbit around the Sun.

    What exactly are Trojans?

    • Lucy’s Trojan destinations are trapped near Jupiter’s Lagrange (L) points, which are gravitationally stable locations — it is where the gravity from the Sun and from Jupiter cancel each other out.
    • This means their orbits are stable and the Trojans are trapped in the space between.
    • This also means that asteroids are as far away from Jupiter as they are from the Sun.
    • Jupiter’s leading and trailing Lagrangian points (L4 and L5) have been stable over the age of the solar system.
    • This means that their orbits have accumulated many, many asteroids.
    • It makes sense to call a Trojan a co-orbital object, which moves around one of the two stable Lagrangian points.

    When and how were they discovered?

    • It took many a scientist to understand Trojans, and subsequently, name them so.
    • A German astro-photographer in 1906 made an important discovery: An asteroid with a particularly unusual orbit. As Jupiter moved, this asteroid remained ahead of Jupiter.
    • It was observed that the asteroid was nearly 60 degrees in front of Jupiter.

    Students with engineering background would better understand who Lagrange was. Rest need not care.

    Lagrange’s propositions

    • This specific position of a peculiar behaviour was predicted by the Italian-French mathematician Joseph-Louis Lagrange over 100 years earlier.
    • Lagrange had argued that if a small celestial body is placed at one of two stable points in a planet’s orbit around the Sun (the L4 and L5), the asteroid would remain stationary from the planet’s perspective.
    • This is due to the combined gravitational forces of the planet and the Sun.
    • Thus, Lagrange’s prediction acquired credibility. More such asteroids were discovered over subsequent months in Jupiter’s Lagrange point L5.

    Behind the name: Lucy

    • It is the fossil of a hominin that lived 3.2 million years ago.
    • She is known to be one of the most famous pre-human fossil in history.
    • Nearly 40 per cent of the fossilised skeleton of this hominin was discovered in 1974 by a team of paleoanthropologists led by Donald Johanson.
    • The name was inspired from the famous Beatles song “Lucy in the Sky With Diamonds,” which Johanson’s team listened to at camp the night of their discovery.

     

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    Back2Basics: Lagrange Points

    • Lagrange points are positions in space where objects sent there tend to stay put.
    • They are named after Italian-French mathematician Josephy-Louis Lagrange.
    • At Lagrange points, the gravitational pull of two large masses precisely equals the centripetal force required for a small object to move with them.
    • These points in space can be used by spacecraft to reduce the fuel consumption needed to remain in position.
    • There are five special points where a small mass can orbit in a constant pattern with two larger masses.

     

  • Places in news: Mawsmai Cave

    A micro snail species named Georissa mawsmaiensis has recently been discovered from Mawsmai, a limestone cave in Meghalaya, 170 years after the last such discovery was made.

    Georissa mawsmaiensis

    • Georissa is found in soil or subterranean habitats in lowland tropical forest as well as high altitude evergreen forests or on rock surfaces rich in calcium.
    • The members of the Georissa genus are widely distributed across and reported from Africa, Asia, and the Pacific.
    • However, they are confined to microhabitats consisting of limestone caves or karst landscapes formed by the dissolution of limestone.

    About Mawsmai Cave

    • The Mawsmai cave is situated in the small village of Mawsmai, around four kilometres from Cherrapunjee (Sohra) in the East Khasi Hills district of Meghalaya.
    • It is located at an altitude of 1,195 metres above sea level and is indirectly influenced by the streams of the Kynshi river originating from the East Khasi Hills.
    • The term ‘Mawsmai’ means ‘Oath Stone’ in the Khasi language. The Khasi people use the local term ‘Krem’ for the cave.
    • It is famous for its fossils, some which can be spotted looking at the walls and formations inside.
    • The longest is Krem Liat Prah in the Jaintia Hills, which is 30,957 m (31 km approx.)

     

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  • The outlines of a national security policy

    Context

    National security concepts have, in the two decades of the 21st century, undergone fundamental changes. Cyberwarfare has vastly reduced the deterrent value of conventional deterrents.

    Emergence of cyberwarfare

    • In the 21st century, after cybertechnology enters as an important variable in nations’ defence policies.
    • Geographical land size or GDP size will be irrelevant in war-making capacity or deterrence.
    • These fundamental changes are entirely due to the earlier 20th century innovations in cybertechnology and software developments.
    • Drones, robots, satellites and advanced computers as weapons are already in use.
    • Some examples of further innovations are artificial intelligence and nanotechnology.
    • Tracking those cyber warfare threat will need a new national security policy.
    • By credible accounts, China, recently, publicly cautioned Indians to sit up and take notice by using cybertechnology to shut down Mumbai’s electric supply in populated areas of the city, for a few hours.

    Four dimensions of national security policy

    • Objectives: the objective of the National Security Policy in the 21st century is to define what assets are required to be defended, the identity of opponents.
    • Although the novel coronavirus is perhaps accidental, it has completely destabilised peoples globally and their governments in all nations of the world over.
    • This is a preview of the kinds of threats that await us in the coming decades which a national security policy will have to address by choosing a nation’s priorities.
    • Priorities: National security priorities will require new departments for supporting several frontiers of innovation and technologies such as hydrogen fuel cells, desalination of seawater, thorium for nuclear technology, anti-computer viruses, and new immunity-creating medicines.
    • This focus on a new priority will require compulsory science and mathematics education, especially in applications for analytical subjects.
    • Strategy: The strategy required for this new national security policy will be to anticipate our enemies in many dimensions and by demonstrative but limited pre-emptive strikes by developing a strategy of deterrence of the enemy.
    • For India, it will be the China cyber capability factor which is the new threat for which it has to devise a new strategy.
    • Resource mobilisation: The macroeconomics of resource mobilisation depends on whether a nation has ‘demand’ as an economic deficit or not.
    • If demand for a commodity or service is in deficit to clear the market of the available supply of the same, then liberal printing of currency and placing it in the hands of consumers is recommended for the economy to recover the demand-supply parity.
    • A way to increase demand is by lowering the interest rate on bank loans or raising the rates in fixed deposits which will enable banks to obtain liquidity and lend liberally for enhancing investment for production.
    • If it is ‘supply’ that is short or in deficit compared to demand, then special measures are required to incentivise to encourage an increase in supply.

    Conclusion

    National security at its root in the 21st century will depend on mind-boggling skills in the four dimensions mentioned above.

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  • Type Of Technologies in Solar Panels

    Context

    Large-scale solar projects in Tamil Nadu have seen rapid growth in recent years. By embracing advances in solar technologies, India can continue to lead in this sector.

    Factors driving growth

    • In the past five years, the cumulative installed capacity witnessed a four-fold increase in Tamil Nadu to 4.4 GW, as of March 2021.
    • High insolation level: Aiding this capacity addition is the State’s reasonably high insolation levels and matching solar potential, estimated at 279GW.
    • Decline in price: The sharp decline in the prices for solar and resulting cost competitiveness is another factor.
    • National target: Additionally, in response to the ambitious national targets and to spur sector specific development, Tamil Nadu released the Solar Policy of 2019, aiming for 9GW of solar installations by 2023.

    Type of technology use for solar panel

    • 1) Mono-crystalline Vs multi-crystalline panels: ‘First-generation’ solar cells use mono-crystalline and multi-crystalline silicon wafers.
    • The efficiency of mono-crystalline panels is about 24%, while for multi-crystalline panels it is about 20%.
    • Mono-crystalline cells are dominant today.
    • Although mono-crystalline panels are priced higher than multi-crystalline ones, the difference is diminishing and will soon attain parity.
    • This would result in mono panels being preferred over multi due to their higher efficiency, greater energy yield and lower cost of energy.
    • 2) Bifacial solar cells: Newer technologies incorporating crystalline silicon focus on bifacial solar cells, capable of harvesting energy from both sides of the panel.
    • Bifacials can augment the power output by 10-20%.
    • Within this, the Passive Emitter and Rear Contact technology is predicted to gain popularity. However, it is yet to achieve price parity for large-scale deployment.
    • 3) Thin-film technologies: It is classified as the ‘second generation of solar PVs.
    • In addition to being used in solar farms and rooftops, thin films with their low thickness, light weight and flexibility are also placed on electronic devices and vehicles, power streetlights and traffic signals.
    • Mainstream thin films utilise semiconductor chemistries like Cadmium Telluride with module efficiencies of around 19%.
    • Other technologies include Amorphous Silicon and Copper Indium Gallium Di-Selenide.
    • Nanocrystal and dye-sensitised solar cells are variants of the thin film technology. These are in early stages for large-scale commercial deployment
    • However, the efficiency of thin films is lower than that of crystalline silicon.
    • 4) Perovskite: These are grouped as ‘third generation’ and contain technologies such as perovskite, nanocrystal and dye-sensitised solar cells.
    • Perovskites have seen rapid advances in recent years, achieving cell efficiency of 18%.
    • They have the highest potential to replace silicon and disrupt the solar PV market, due to factors such as ease of manufacture, low production costs and potential for higher efficiencies.
    • 5) Use of Graphene Quantum-dots: Graphene is made of a single layer of carbon atoms bonded together as hexagons.
    • Solar cells made of graphene are of interest due to high theoretical efficiency of 60% and its super capacitating nature.
    •  Quantum-dot PVs use semiconductor nanocrystals exhibiting quantum mechanical properties capable of high efficiency of about 66%.
    • However, both these are in the early stages of research.

    Technologies to better integrate solar PVs into the grid

    • These technologies include weather forecasting and power output prediction systems; operation monitoring and control systems; and scheduling and optimisation systems.
    • Additionally, automatic systems have been developed for the smooth resolution of output fluctuations.

    Way forward

    • A portion of the budget for renewable energy targets should be set aside exclusively for new technologies.
    • Grants and subsidies can also be provided for their adoption.
    • Efforts must be taken to address gaps in research, development, and manufacturing capabilities in the solar sector through sector-specific investment and incentives.
    • There must also be greater industry-academia collaborations and funding opportunities for startups.
    • A comprehensive sector-specific skilling programme is also required for workers.

    Conclusion

    All these efforts would help the country become a global player in the solar power sector.

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  • Gross NPAs of Banks to Rise

    Gross Non-Performing Assets (NPAs) of banks are expected to rise to 8-9% this fiscal from 7.5% as on March 31, 2021 but they would still remain below the peak of 11.2% seen at the end of fiscal 2018.

    What are Non-Performing Assets?

    • For a bank, the loans given by the bank is considered as its assets.
    • Any asset which stops giving returns to its investors for a specified period of time is known as Non-Performing Asset (NPA).
    • So, if the principle or the interest or both the components of a loan is not being serviced to the lender (bank), then it would be considered as NPA.

    Classification of NPAs in India

    • According to the RBI, a NPA is a loan or advance for which the principal or interest payment remained overdue for a period of 90 days.
    • Banks are required to classify NPAs further into Substandard, Doubtful and Loss assets.
    1. Substandard Assets: Assets which has remained NPA for a period less than or equal to 12 months.
    2. Doubtful Assets: An asset would be classified as doubtful if it has remained in the substandard category for a period of 12 months.
    3. Loss Assets: As per RBI, loss asset is considered uncollectible and of such little value that its continuance as a bankable asset is not warranted, although there may be some salvage or recovery value.

    NPAs of Agriculture Loans

    In terms of Agriculture/Farm Loans, the NPA is defined as under:

    • For short duration crop such as paddy, Jowar, Bajra etc. if the loan (instalment/interest) is not paid for 2 crop seasons, it would be termed as an NPA.
    • For Long Duration Crops, the above would be 1 Crop season from the due date

    Reasons for NPAs in India

    Impact of NPA on Economy

    • Depositors’ loss: Depositors do not get rightful returns and many times may lose uninsured deposits.
    • High interest on lending: Banks may begin charging higher interest rates on some products to compensate NPA loan losses.
    • Trust issues: Bad loans imply redirecting of funds from good projects to bad ones. Hence, the economy suffers due to loss of good projects and failure of bad investments

    Steps taken to curb NPA

    (A) By the Govt

    • Mission Indradhanush:to make the working of public sector bank more transparent and professional in order to curb the menace of NPA in future.
    • Insolvency and Bankruptcy Code: To make it easier for banks to recover the loans from the debtors.
    • Stringent NPA recovery rules: The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act or SARFESI Act of 2002 was amended in 2016.

    (B) By RBI

    RBI introduced number of measures in last few years which include:

    • Corporate Debt Restructuring (CDR) mechanism,
    • Setting up a Joint Lenders’ Forum, providing banks to disclose the real picture of bad loans, asking them to increase provisioning for stressed assets,

    Other terms related to NPAs

    Write-off effect

    • A loan write-off is a tool used by banks to clean up their balance-sheets.
    • If a loan turns bad on the account of the repayment defaults for at least three consecutive quarters, the exposure (loan) can be written off.
    • A loan write-off sets free the money parked by the banks for the provisioning of any loan.

    Twin Balance Sheet

    • It deals with two balance sheet problems. One with Indian companies and the other with Indian Banks.
    • Debt accumulation on companies is very high and thus they are unable to pay interest payments on loans.

    Four Balance Sheet Challenge

    • In his paper named ‘India’s Great Slowdown’, Arvind Subramanian (former Chief Economic Advisor) mentions the new ‘Four balance sheet challenge’.
    • It includes the original two sectors – infrastructure companies and banks, plus NBFCs and real estate companies.

     

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  • World Economic Outlook (WEO) Report by IMF

    The International Monetary Fund (IMF) has unveiled its 2nd World Economic Outlook (WEO) Report.

    About WEO Report

    • The WEO is a report by the IMF that analyzes key parts of the IMF’s surveillance of economic developments and policies in its member countries.
    • It also projects developments in the global financial markets and economic systems.
    • The report comes out twice every year — April and October.
    • It is based on a wide set of assumptions about a host of parameters — such as the international price of crude oil — and set the benchmark for all economies to compare one another with.

    Key takeaways from the October 2021 WEO

    • The central message was that the global economic recovery momentum had weakened due to the pandemic-induced supply disruptions.
    • It is the increasing inequality among nations that IMF was most concerned about.
    • The dangerous divergence in economic prospects across countries remains a major concern.

    Reasons for the slowdown

    There are two key reasons:

    1. Large disparities in vaccine access
    2. Differences in policy support

    What about Employment?

    Ans. There is a lag.

    • Employment around the world remains below its pre-pandemic levels.
    • This reflects a mix of negative output gaps, worker fears of on-the-job infection in contact-intensive occupations, childcare constraints, labour demand changes due to automation etc.
    • The main concern is the gap between recovery in output and employment which is likely to be larger in emerging markets and developing economies than in advanced economies.
    • Further, young and low-skilled workers are likely to be worse off than prime-age and high-skilled workers, respectively.

    Implications for India

    Ans. Reduce India’s growth momentum

    • IMF has suggested that India’s economic recovery is gaining ground.
    • Some sectors such as the IT-services sectors have been practically unaffected by Covid, while the e-commerce industry is doing brilliantly.
    • However, the recovery in unemployment is lagging the recovery in output (or GDP).
    • This matters immensely for India as it reflects jobless growth.
    • India was already facing a deep employment crisis before the Covid crisis, and it became much worse after it.
    • Lack of adequate employment levels would again drag down overall demand and affect the growth momentum.

    Threats to growth momentum

    • Usual unemployment: Even before the pandemic, India already had a massive unemployment crisis.
    • Sector-wise recovery: India is witnessing a K-shaped recovery. That means different sectors are recovering at significantly different rates.
    • Unorganized sector: A weak recovery for the informal/unorganized sectors implies a drag on the economy’s ability to create new jobs or revive old ones.
    • Contact-based services: Such services which can create many more jobs, are not seeing a similar bounce-back.

    How informal is India’s economy?

    • A NSO report titled ‘Measuring Informal Economy in India’ gives a detailed account of informal Indian economy.
    • It shows the share of different sectors of the economy in the overall Gross Value Added and the share of the unorganised sector therein.
    • The share of informal/unorganised sector GVA is more than 50% at the all-India level, and is even higher in certain sectors.
    • It creates a lot of low-skilled jobs such as construction and trade, repair, accommodation, and food services.

    This is why India is more vulnerable.

     

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  • EU food recalled over alleged GM rice exports from India

    The European Union has recalled some packaged food items which were made up of Indian GMO.

    GM crops in India

    The Genetic Engineering Appraisal Committee (GEAC) under Environment Ministry oversees the approval of GM Crops in India.

    • Bt cotton: It is the only GM crop that has been approved for commercial cultivation in 2002.
    • Bt Brinjal: Resistant to brinjal shoot fly, it was approved by GEAC in 2009. However due to 10 years moratorium imposed on GM crops by the Technical Expert Committee (TEC) appointed by the Supreme Court of India, its commercialization has stalled.
    • GM Dhara Mustard Hybrid 11: DMH 11 developed by Delhi University is pending for commercial release as GEAC has advised to generate complete safety assessment.

    However, unauthorized HtBt Cotton and Bt Brinjal are being grown commercially, with hundreds of growers blatantly defying the governmental ban.

    What about GM Rice?

    • GM rice is not grown commercially in India.
    • However, multiple GM rice varieties have been approved for confined field trials.
    • There seems a possibility of cross-contamination from such field trials directly or through seed leakages.

    India’s rice exports

    • India’s annual rice exports amount to 18 million tonnes worth ₹65,000 crore, and reach more than 75 countries.

    What is the EU move?

    • A European candy has recalled several batches of its product from the market due to the use of rice flour with genetically modified (GM) contamination that allegedly originated in India.
    • The EU notification has identified the product as ‘Unauthorised genetically modified (p35S and tNos) rice flour from India’.

    Impact of the EU move

    • This has led to the loss of reputation of India and its agricultural market.
    • With such a move by the EU, it is Indian farmers and exporters who have much to lose.

    Threats posed by GM crops

    • It is believed that consumption of genetically engineered foods can cause the development of diseases which are immune to antibiotics.
    • Besides, as these foods are new inventions, not much is known about their long term effects on human beings.
    • Genetically modified rice may potentially cause serious public health and environmental problems.
    • Two major issues about GM rice are their tendencies to provoke allergic reactions and the uncertainty of gene transfers.

    What can be done to reverse this?

    • Ban on field trials of GM crops
    • Slapping liability for illegal release of GMOs into the environment on developers
    • Probe to identify the source of the GM rice contamination

    Try answering this PYQ:

    With reference to the Genetically Modified mustard (GM mustard) developed in India, consider the following statements:

    1. GM mustard has the genes of a soil bacterium that give the plant the property of pest-resistance to a wide variety of pests.
    2. GM mustard has the genes that allow the plant cross-pollination and hybridization.
    3. GM mustard has been developed jointly by the IARI and Punjab Agricultural University.

    Which of the statements given above is/are correct?

    (a) 1 and 3 only

    (b) 2 only

    (c) 2 and 3 only

    (d) 1, 2 and 3

     

    [wpdiscuz-feedback id=”zieaak7yfu” question=”Please leave a feedback on this” opened=”1″]Post your answers here.[/wpdiscuz-feedback]

     

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  • Lessons from the coal shortage

    Context

    Normally, the power-generating companies maintain around 30 days of inventory of coal, but, currently, this has come down to three days.

    Factors responsible for the crisis

    • Supply side issue: On the supply side, because of low investment, coal cannot be mined more than the capacity which exists today. Hence, the increase in supplies will be gradual.
    • High global prices: The global coal crisis has led to higher prices.
    • Here, too, a sudden resurgence in demand after the pandemic has exposed the supply limitations.
    • The international price has gone up by almost 40 per cent in the last month.
    • China factor: China – a major producer and consumer – has also faced this problem as it has tried to save coal for the future and imposed restrictions on mining to go green.
    • Emphasis on lowering the dependence on import:  In India, coal imports have been traditionally high.
    • Under its atmanirbharta drive, the government has voiced concerns on this issue and asked generators to be more self-reliant.
    • Coal dependency came down over time, which also coincided with a lower phase of economic growth.
    • The same has happened in China where the government has taken the greening concept seriously and asked coal producers to control production and power generators and move over to other greener fuels.
    • This has made coal producers less willing to increase investment.

    Why power companies are reluctant to import coal?

    • Ideally, power companies should import coal.
    • But that increases the cost of power production and power tariffs cannot be revised easily, like in the case of crops.
    • The power sector, however, already has its woes.
    • Distribution companies have been running losses due to their inability to cut down on transmission losses or increase tariffs.
    • As their losses mount, the amount overdue to the generators increases.
    • Therefore, the producers are not willing to increase their costs.

    How it would impact the economy?

    • The economy has been showing signs of recovering and the October-December period is crucial because there are expectations of pent-up demand helping to accelerate growth.
    • Any disruption in the power supply can push back this process.
    • The challenge is that today all the three sectors, agriculture, industry and households, are equally important.
    • A lot of business is being conducted from home after the pandemic, and power disruptions will come in the way of work.
    • If power companies start revising their tariffs, inflation will shoot up.

    Conclusion

    The coal shortage problem is very serious as it affects power supply, which is the backbone of all economic activity. All stakeholders – the Centre, states, miners and power generators – must work together and plan the strategy going ahead.

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