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GS Paper: GS3

  • What is a Bitcoin Hardware Wallet and how it works?

    Last week, Twitter CEO announced his payments firm Square would soon build a hardware wallet to store bitcoin.

    Bitcoin Hardware Wallet

    • The wallet will be a type of plug-in device, much like a USB pen drive that stores, manages and secures a user’s crypto assets.
    • Each digital asset is linked to a cryptographic password called a ‘private key’ to allow users to access it.
    • This key safeguards cryptocurrencies from theft and unauthorized access.
    • The asset owner, with the help of a secure hardware wallet, can access the private key to buy and sell crypto assets from anywhere.
    • Most hardware wallets allow users to manage multiple accounts; some even allow users to connect to their Google or Facebook accounts.
    • Popular hardware wallets include Trezor, Ledger, KeepKey and Prokey.

    How is it different from a software wallet?

    • Cryptocurrency keys can be stored in two kinds of wallets – software and hardware.
    • Software wallets are like smartphone apps that digitally store private keys.
    • Most software wallets don’t charge users to store private keys but may collect a commission for trading via the app.
    • These wallets can be vulnerable to malware.
    • Hardware wallets and physical devices act like cold storage for confidential keys. The passwords are protected by a PIN, making it difficult for hackers to extract private keys as the information is not exposed to the Internet.

    The upsides of a hardware wallet

    • Hardware wallets are said to be convenient as they can be connected to trading exchanges to complete transactions.
    • Hardware wallets are often stored in a protected microcontroller and cannot be transferred out of the device, making them secure.
    • Their isolation from the Internet also mitigates the risk of the assets being compromised. Moreover, it does not rely on any third-party app.

    Limitations

    • Since the wallet is in physical form, the device could be stolen or destroyed.
    • They could be used by malicious actors to steal confidential data.
    • The device can also be expensive as compared to software wallets.
    • Some hardware wallets can also have complex features, making it difficult for first-timers to understand.

    Answer this PYQ in the comment box:

    Q.With reference to “Blockchain Technology”, consider the following statements:

    1. It is a public ledger that everyone can inspect but which no single user controls.
    2. The structure and design of block chain is such that all the data in it are about crypto currency only.
    3. Applications that depend on basic features of blockchain can be developed without anybody’s permission.

    Which of the statement given above is/are correct?

    (a) 1 only

    (b) 2 only

    (b) 1 and 2 only

    (d) 1 and 3

    Back2Basics: Cryptocurrencies

    • A cryptocurrency is a digital asset designed to work as a medium of exchange wherein individual coin ownership records are stored in a ledger existing in a form of a computerized database.
    • It uses strong cryptography to secure transaction records, control the creation of additional coins, and verify the transfer of coin ownership.
    • It typically does not exist in physical form (like paper money) and is typically not issued by a central authority.
    • Cryptocurrencies typically use decentralized control as opposed to centralized digital currency and central banking systems.

  • Retail Direct Scheme for G-Secs

    The RBI has announced a scheme under which retail investors will be allowed to open retail direct gilt accounts (RDG) directly with the central bank.

    Retail Direct Scheme

    • The scheme is a one-stop solution to facilitate investment in government securities (G-secs) by individual investors.
    • Under RDG schemes, accounts can be opened through a dedicated online portal, which will provide registered users access to primary issuance of government securities and to NDS-OM.

    What is a gilt account?

    • A “Gilt Account” means an account opened and maintained for holding Government securities, by an entity or a person including ‘a person resident outside India’ with a “Custodian” permitted by the RBI.

    About Government Securities

    • These are debt instruments issued by the government to borrow money.
    • The two key categories are:
    1. Treasury bills (T-Bills) – short-term instruments which mature in 91 days, 182 days, or 364 days, and
    2. Dated securities – long-term instruments, which mature anywhere between 5 years and 40 years

    Note: T-Bills are issued only by the central government, and the interest on them is determined by market forces.

    Why G-Secs?

    • Like bank fixed deposits, g-secs are not tax-free.
    • They are generally considered the safest form of investment because they are backed by the government. So, the risk of default is almost nil.
    • However, they are not completely risk-free, since they are subject to fluctuations in interest rates.
    • Bank fixed deposits, on the other hand, are guaranteed only to the extent of Rs 5 lakh by the Deposit Insurance and Credit Guarantee Corporation (DICGC).

    Retail investors and G-Secs

    • Small investors can invest indirectly in g-secs by buying mutual funds or through certain policies issued by life insurance firms.
    • To encourage direct investment, the government and RBI have taken several steps in recent years.
    • Retail investors are allowed to place non-competitive bids in auctions of government bonds through their Demat accounts.
    • Stock exchanges act as aggregators and facilitators of retail bids.

  • New Ministry of Cooperation should enable people to leverage community networks

    Context

    India now has a Ministry of Cooperation that aims to strengthen the country’s cooperative movement. This is an opportune moment to look at the movement’s history, examine the potential of cooperatives and analyse the challenges they face.

    Development of Farmer Producer Companies in India

    • India’s significant tryst with dairy cooperatives began in the 1950s with the success of what we know today as Amul.
    • The nation took note of this initiative and the National Dairy Development Board was set up in 1965.
    • However, the expansion wasn’t working the way it had been envisaged.
    • The need for a new model was felt soon as cooperatives outside Anand were not holding regular and proper elections.
    • Their accounts were not audited.
    • As a result, a committee was set up in the Company Affairs Ministry to allow farmers to set up companies.
    • The Farmer Producer Companies (FPCs) would run on the principle of “one share one vote” and the essence of cooperatives would not be diluted.
    • The Parliamentary Committee looked into the Bill to give legal backing to FPCs, with this, the Companies Act (Second Amendment), 2002 became law.

    Funding the FPCs

    • The existing funding vehicles were designed to cater to cooperatives, not FPCs
    •  Around 2010, the Boston Consulting Group (BCG) had been commissioned to develop a plan for restructuring NABARD.
    • As a result, the restructured NABARD had a special window for FPCs.

    Community-based cooperatives

    •  The Cheliya community set up a chain of Hearty Mart “cooperative” supermarkets in villages in Gujrat using the franchise model.
    •  Just as the network of Charotar Patels that Kurien relied on in the case of Amul —Cheliya community have played a key role in the spread of the model.
    • The idea of leveraging the community network was tried in some parts of the country in the context of re-imagining economic infrastructure.
    • To deal with the electricity board failures, a distribution company was run on a community basis.
    • This model has, in fact, worked in places like Kanpur, even Kerala.

    Social cooperatives

    • The concept of social cooperatives builds on the idea of communities creating infrastructure by using local material and family labour.
    • These can be the village tank, paving the village road — with or without MGNREGA — finishing the last-mile construction of a canal network or even keeping watch on the contractor.
    • The pandemic seems to have increased the significance of community effort.
    • Reducing vaccine hesitancy, providing food to those waiting outside hospitals and, most importantly, looking after orphaned children are imperatives crying out for the cooperative model.

    Way forward for new Ministry of Cooperatives

    •  Keeping in mind social needs while using resources is a large part of the solution to our current predicament.
    • The pandemic will not follow the laws of corporate finance, cooperation has a lot to speak for itself, the new ministry should take this message.
    • The new work-from-home model will create several problems as well as offer opportunities.
    • The new ministry is a recognition of the needs of our times.
    • But it should not be just about pumping in money. 

    Conclusion

    This is the time to design models that help those who help themselves. We will wait expectantly to see how the new ministry works.

  • 2020 Millennium Technology Prize  

    The 2020 Millennium Technology Prize has been awarded to Shankar Balasubramanian and David Klenerman, for their development of revolutionary Next-generation DNA sequencing techniques.

    About Millennium Technology Prize

    • The Millennium Technology Prize is one of the world’s largest technology prizes.
    • It is awarded once every two years by Technology Academy Finland, an independent fund established by Finnish industry and the Finnish state in partnership.

    What is next-generation DNA sequencing?

    • Next-generation sequencing (NGS) is a massively parallel sequencing technology that offers ultra-high throughput, scalability, and speed.
    • The technology is used to determine the order of nucleotides in entire genomes or targeted regions of DNA or RNA.
    • These technologies allow for sequencing of DNA and RNA much more quickly and cheaply than the previously used sequencing.
    • NGS has revolutionized the biological sciences, allowing labs to perform a wide variety of applications and study biological systems at a level never before possible.
    • More than a million base pairs can be sequenced, which translates to hundreds of genes or even the whole genome of an organism.
    • This is made possible by simultaneously sequencing hundreds of pieces of DNA at the same time.

    What is sequencing, btw?

    • DNA (or RNA, in some viruses), the genetic material of life forms, is made of four bases (A, T, G and C; with U replacing T in the case of RNA).
    • A chromosome is the duplex of a long linear chain of these – and in the DNA sequence is information – the blueprint of life.
    • Life famously can replicate, and DNA replicates when an enzyme, DNA polymerase, synthesises a complementary strand using an existing DNA strand as the template.
    • The breakthrough idea of Balasubramanian and Klenerman was to sequence DNA (or RNA) using this process of strand synthesis.
    • They cleverly modified their ATGC bases so that each shone with a different colour.
    • When copied, the “coloured” copy of DNA could be deciphered from the colours alone, using miniature optical and electronic devices.

    What about the cost of all this sequencing?

    • When the Human Genome Project delivered the first, near-complete sequence of our genome, the cost was estimated to have been 3 billion dollars.
    • As all our chromosomes together have 3 billion base pairs, it becomes an easy calculation – One dollar per sequenced base.
    • By the year 2020, NGS technologies has pushed the price for sequencing to a few thousands of rupees.

    Back2Basics:

    What is the Human Genome Project?

  • Sikkim is home to 27% of India’s flowering plants

    Sikkim, the smallest State with less than 1% of India’s landmass, is home to 27% of all flowering plants found in the country, reveals a recent publication by the Botanical Survey of India (BSI).

    Flora of Sikkim

    • Flora of Sikkim – A Pictorial Guide lists 4,912 naturally occurring flowering plants in the tiny Himalayan State.
    • The total number of naturally occurring flowering plants in the country is about 18,004 species, and with 4,912 species, the diversity of flowering plants in Sikkim, spread over an area of 7,096 sq. km. is very unique.

    Why is Sikkim a host to such large biodiversity?

    • Sikkim is a part of the Kanchenjunga biosphere landscape, has different altitudinal ecosystems, which provide opportunities for herbs and trees to grow and thrive.
    • The State also borders China, Bhutan and Nepal, and the Darjeeling Hills of West Bengal.
    • From subalpine vegetation to the temperate to the tropical, the State has different kinds of vegetation, and that is the reason for such a diversity of flora.
    • The elevation also varies between 300 to 8,598 metres above mean sea level, the apex being the top of Mt. Kanchenjunga (8,586 metres).

    Contribution by the Public

    • The people of Sikkim have a unique bond with nature and trees.
    • As per the Sikkim Forest Tree (Amity & Reverence) Rules, 2017 the State government allows any person to associate with trees standing on his or her private land or on any public land by entering into a Mith/Mit or Mitini relationship.
    • The notification encouraged people to adopt a tree “as if it was his or her own child in which case the tree shall be called an adopted tree”.

    Answer this PYQ in the comment box:

    Q.Which one of the following National Parks lies completely in the temperate alpine zone?

    (a) Manas National Park

    (b) Namdapha National Park

    (c) Neora Valley National Park

    (d) Valley of Flowers National Park

  • Places in news: Lemru Elephant Reserve

    The proposed Lemru Elephant Reserve in Chhattisgarh, in the pipeline for 20 years, has become the subject of yet another controversy over the reduction of its size.

    Lemru Elephant Reserve

    • The proposal for the reserve, in Korba district, was passed unanimously by the Assembly in 2005 and got central approval in 2007.
    • Lemru is one of two elephant reserves planned to prevent human-animal conflict in the region, with elephants moving into Chhattisgarh from Odisha and Jharkhand.
    • Its area was then proposed to be 450 sq km.

    Why does the government want to reduce the size of the reserve?

    • The area proposed under the reserve is part of the Hasdeo Aranya forests, a very diverse biozone that is also rich in coal deposits.
    • Of 22 coal blocks in the area, seven have already been allotted with mines running in three, and in the process of being established in the other four.
    • Under the ‘No-Go Area’ policy from the UPA area, the entire area was considered out of bounds for mines, but in 2020, five coal blocks from the region were put on the auction list.

    Why is the reserve important?

    • North Chhattisgarh alone is home to over 240 elephants.
    • Elephants in Chhattisgarh are relatively new; they started moving into undivided Madhya Pradesh in 1990.
    • Since these animals were relatively new, the human-animal conflict started once elephants started straying into inhabited areas, looking for food.

  • Graded Response Action Plan (GRAP)

    Fearing any surge in coronavirus cases in the national capital, which is witnessing a decline in cases of infection, the Delhi government has chalked out the ‘Graded Response Action Plan (GRAP).’

    Graded Response Action Plan (GRAP)

    • In 2014, when a study by the WHO found that Delhi was the most polluted city in the world, panic spread in the Centre and the state government.
    • Approved by the Supreme Court in 2016, the plan was formulated after several meetings that the Environment Pollution (Prevention and Control) Authority (EPCA) held with state government and experts.
    • The result was a plan that institutionalized measures to be taken when air quality deteriorates.
    • GRAP also works as an emergency measure.
    • It includes strict measures such as a ban on the entry of heavy vehicles, the odd-even road rationing restrictions, and a halt of construction work – each of which is likely to be impractical at a time when the pandemic has exacted heavy economic costs and public transport has been seen as an infection risk.

    For covid purposes

    • This time, it was decided to notify the GRAP that will “objectively and transparently” ensure an “institutional and automatic” response with regards to enforcement measures, lockdowns and unlock activities.
    • The plan was prepared in comparison with ascent data of the four waves at specific positivity rates of 0.5%, 1%, 2% and 5% and also considered on the basis of the earlier four waves.

  • [pib] Species in news: Avicennia Marina

    Scientists at the Department of Biotechnology (DBT) have reported for the first time a reference-grade whole genome sequence of a highly salt-tolerant and salt-secreting true-mangrove species Avicennia Marina.

    Avicennia marina

    • Avicennia marina is one of the most prominent mangroves species found in all mangrove formations in India.
    • It is a salt-secreting and extraordinarily salt-tolerant mangrove species that grows optimally in 75% seawater and tolerates >250% seawater.
    • It is among the rare plant species, which can excrete 40% of the salt through the salt glands in the leaves, besides its extraordinary capacity to exclude salt entry to the roots.

    Why in news?

    • The A. marina genome assembled in this study is nearly complete and can be considered as a reference-grade genome reported so far for any mangrove species globally and the first report from India.
    • This study assumes significance as agriculture productivity globally is affected due to abiotic stress factors such as limited water availability and salinization of soil and water.

    Its significance

    • Availability of water is a significant challenge to crop production in dryland areas, accounting for ~40 per cent of the world’s total land area.
    • Salinity is prevalent in ~900 million hectares globally (with an estimated 6.73 million ha in India), and it is estimated to cause an annual loss of 27 billion USD.
    • The genomic resources generated in the study will pave the way for researchers to study the potential of the identified genes for developing drought and salinity tolerant varieties of important crop species.
    • This is particularly important for the coastal region as India has 7,500m of coastline and two major island systems.

    Try these PYQs:

    Q.Which one of the following is the correct sequence of ecosystems in the order of decreasing productivity? (CSP 2013)

    (a) Oceans, lakes, grasslands, mangroves

    (b) Mangroves, oceans, grasslands, lakes

    (c) Mangroves, grasslands, lakes, oceans

    (d) Oceans, mangroves, lakes, grasslands

     

    Q.The 2004 Tsunami made people realize that mangroves can serve as a reliable safety hedge against coastal calamities. How do mangroves function as a safety hedge? (CSP 2011)

    (a) The mangrove swamps separate the human settlements from the sea by a wide zone in which people neither live nor venture out

    (b) The mangroves provide both food and medicines which people are in need of after any natural disaster

    (c) The mangrove trees are tall with dense canopies and serve as an excellent shelter during a cyclone or tsunami

    (d) The mangrove trees do not get uprooted by storms and tides because of their extensive roots.

    Back2Basics: Mangroves

    • A mangrove is a shrub or small tree that grows in coastal saline or brackish water.
    • Mangroves occur worldwide in the tropics and subtropics, mainly between latitudes 30° N and 30° S, with the greatest mangrove area within 5° of the equator.
    • Mangroves are salt-tolerant trees, also called halophytes, and are adapted to live in harsh coastal conditions.
    • They contain a complex salt filtration system and complex root system to cope with salt water immersion and wave action.
    • They are adapted to the low-oxygen conditions of waterlogged mud.
    • They are a unique group of species found in marshy intertidal estuarine regions and survive a high degree of salinity through several adaptive mechanisms.
    • They form a link between marine and terrestrial ecosystems, protect shorelines, provide habitat for a diverse array of terrestrial organisms.

  • Need for coordinated database for tracking fugitives

    Context

    India lacks a domestic tracking system for fugitives. That makes it easier for them to evade the criminal justice system.

    Challenges at investigation and prosecution level

    • Central agencies have developed reasonable expertise in investigation and prosecution because they are focussed only on investigation and prosecution work.
    • On the other hand, State police forces (except specialised wings) are engaged in law-and-order work as well as investigations.
    • The bulk of the investigation and prosecution work happens at police stations in the States.
    • There is a tendency to close investigations once the accused have absconded.
    • Some police stations do initiate proceedings for attachment of property and declaration of the accused as proclaimed offenders, but the number of cases where coordinated efforts are made to pursue fugitives – domestically or internationally – are hardly documented.

    No system for tracking criminals domestically

    • Through Interpol Notices and the sharing of immigration databases of different countries, there exists a system of tracking criminals worldwide.
    • However, there is no coordinated system or database for tracking criminals or wanted persons domestically in India.
    • In the absence of such a system, it is relatively easy for criminals from one police station/jurisdiction to melt into the population in any other area, almost undetected.

    Way forward

    • The creation of a nationwide database of wanted persons, which could be accessible for police agencies, the public and others is needed.
    • A nation-wide system of ‘Wanted Persons Notices’, similar to Interpol Notices, is required, to help track fugitives domestically.
    • The Crime and Criminal Tracking Network and Systems and the National Intelligence Grid are efforts in the right direction/
    • Countries like the U.S. have functional inter-State extradition and fugitive tracking systems.
    • India needs to set up such dedicated ‘fugitive tracking units’.
    • There needs to be enhanced integration between immigration agencies, State police agencies, Interpol-New Delhi, the External Affairs Ministry and Home Ministry and central investigation agencies.
    • Sharing India’s ‘wanted’ database or providing access to it to foreign embassies on a reciprocal basis or through treaties or arrangements would also be helpful.
    • Signing of more bilateral and multilateral conventions on criminal matters would help plug legal infirmities.
    • Signing bilateral agreements on cooperation in policing matters would also help.
    • All relevant legal processes and requirements should be incorporated into one consolidated law on international cooperation.
    • The entire gamut of activities pertaining to fugitives, from investigation to extradition, needs to be incorporated into a specialised set-up.

    Conclusion

    In the absence of a coordinated database, criminals can go undetected. What we need is a watertight system that would deter criminals from hoodwinking the law.

    Back2Basics: Crime and Criminal Tracking Network and Systems (CCTNS)

    • CCTNS aims at creating a comprehensive and integrated system for enhancing the efficiency and effective policing at all levels and especially at the Police Station level.
    • It aism at adoption of principles of e-Governance, and creation of a nationwide networked infrastructure for evolution of IT-enabled state of- the-art tracking system around “investigation of crime and detection of criminals” in real time.
    • It is is a critical requirement in the context of the present day internal security scenario.
    • The scope of CCTNS spans all 35 States and Union Territories and covers all Police Stations (15,000+ in number) and all Higher Police Offices (6,000+ in number) in the country.
    • The CCTNS project includes vertical connectivity of police units (linking police units at various levels within the States – police stations, district police offices, state headquarters, SCRB and other police formations – and States, through state headquarters and SCRB, to NCRB at GOI level) as well as horizontal connectivity, linking police functions at State and Central level to external entities.

    National Intelligence Grid (NATGRID)

    • First conceptualised in 2009, NATGRID seeks to become the one-stop destination for security and intelligence agencies to access database related to immigration entry and exit, banking and telephone details of a suspect on a “secured platform”.
    • All State police are mandated to file First Information Reports (FIR) in the CCTNS.
    • It is only a repository and the data pertaining to FIRs of a particular police station are a State subject.

  • Cabinet extends Agri Infra Fund loans to APMCs

    The Centre has decided to allow state-run market yards to access financing facilities through its Agricultural Infrastructure Fund to calm the fears of protesting farmers that such market yards are being weakened.

    Agriculture Infrastructure Fund (AIF) Schemes

    • It is a Central Sector Scheme meant for setting up storage and processing facilities, which will help farmers, get higher prices for their crops.
    • The Union Cabinet approved this scheme in July 2020 for a period of 10 years.
    • It will support farmers, PACS, FPOs, Agri-entrepreneurs, etc. in building community farming assets and post-harvest agriculture infrastructure.
    • These assets will enable farmers to get greater value for their produce as they will be able to store and sell at higher prices, reduce wastage and increase processing and value addition.

        Note the following things about AIF:

        1) It is a Central Sector Scheme

        2) Duration of the scheme

        3)Target beneficiaries

    What exactly is the AIF?

    • The AIF is a medium – long term debt financing facility for investment in viable projects for post-harvest management infrastructure and community farming assets through interest subvention and credit guarantee.
    • Under the scheme, Rs. 1 Lakh Crore will be provided by banks and financial institutions as loans with an interest subvention of 3% per annum.
    • It will provide credit guarantee coverage under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) for loans up to Rs. 2 Crore.

    Target beneficiaries

    The beneficiaries will include farmers:

    • PACS, Marketing Cooperative Societies, FPOs, SHGs, Joint Liability Groups (JLG), Multipurpose Cooperative Societies, Agri-entrepreneurs, Startups, and Central/State agency or Local Body sponsored Public-Private Partnership Projects

    What are the new changes?

    • The Union Cabinet decided to extend the AIF to State agencies and Agricultural Produce Marketing Committees (APMCs), as well as federations of cooperative organizations, Farmers Producers Organizations and self-help groups.
    • They will now be eligible for interest subvention for loans up to ₹2 crores, with APMCs allowed to access separate loans for different kinds of infrastructure projects to build cold storage, silos, sorting, grading and assaying units in their market yards.
    • The scheme has also been extended to 2032-33.

    Why such a move?

    • The modifications in the Scheme will help to achieve a multiplier effect in generating investments while ensuring that the benefits reach small and marginal farmers.
    • The APMC markets are set up to provide market linkages and create an ecosystem of post-harvest public infrastructure open to all farmers.
    • This is also proof that APMC will not end as the farmers’ concern since the three farm laws.