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GS Paper: GS3

  • Natural gas to come under GST

    Officials have indicated that the government is considering bringing natural gas under the ambit of the GST regime.

    Try this question from CSP 2018:

    Q.Consider the following items:

    1. Cereal grains hulled
    2. Chicken eggs cooked
    3. Fish processed and canned
    4. Newspapers containing advertising material

    Which of the above items is/are exempt under GST (Goods and Services Tax)?

    (a) 1 only

    (b) 2 and 3 only

    (c) 1, 2 and 4 only

    (d) 1, 2, 3 and 4

    Why such demands?

    • Global energy MNCs have called on the government to bring natural gas under the GST regime.
    • Currently petrol, diesel, aviation turbine fuel, natural gas and crude oil fall outside India’s Goods and Services Tax (GST) regime.

    Why is it important to bring natural gas under the GST regime?

    • Bringing natural gas under the GST would lead to a reduction in the cascading impact of taxes on industries such as power and steel, which used natural gas as an input.
    • This would do away with the central excise duty and different value-added taxes imposed by states.
    • This would lead to an increase in the adoption of natural gas in line with the government’s stated goal to increase the share of natural gas in the country’s energy basket from 6.3% to 15%.

    Back2Basics: GST

    • GST launched in India on 1 July 2017 is a comprehensive indirect tax for the entire country.
    • It is charged at the time of supply and depends on the destination of consumption.
    • For instance, if a good is manufactured in state A but consumed in state B, then the revenue generated through GST collection is credited to the state of consumption (state B) and not to the state of production (state A).

    Must read:

    Goods and Services Tax

  • Debate over Plasma Therapy’s efficacy

    Recently published findings on convalescent plasma therapy on Covid-19 patients have triggered a debate over its efficacy.

    Plasma Therapy

    • Plasma is the liquid part of the blood. Convalescent plasma, extracted from the blood of patients recovering from an infection, is a source of antibodies against the infection.
    • The therapy involves using their plasma to help others recover. For Covid-19, this has been one of the treatment options.
    • The donor would have to be a documented case of Covid-19 and healthy for 28 days since the last symptoms.

    How is it done?

    • The process to infuse plasma in a patient can be completed quickly.
    • It only requires standard blood collection practices, and extraction of plasma.
    • If whole blood is donated (350-450 ml), a blood fractionation process is used to separate the plasma.
    • Otherwise, a special machine called aphaeresis machine can be used to extract the plasma directly from the donor.
    • While blood is indeed extracted from the donor, the aphaeresis machine separates and extracts the plasma using a plasma kit, and the remaining blood components are returned into the donor’s body.

    WHO’s guidelines

    • WHO guidelines in 2014 mandate a donor’s permission before extracting plasma.
    • Plasma from only recovered patients must be taken, and donation must be done from people not infected with HIV, hepatitis, syphilis, or any infectious disease.
    • If whole blood is collected, the plasma is separated by sedimentation or centrifugation, then injected in the patient.
    • If plasma needs to be collected again from the same person, it must be done after 12 weeks of the first donation for males and 16 weeks for females, the WHO guidelines state.

    What has happened to spark the debate?

    • An ICMR study has found convalescent plasma was not associated with a reduction in progression to severe Covid-19 or all-cause mortality.
    • While the use of this therapy seemed to improve the resolution of shortness of breath and fatigue in patients with moderate Covid-19, this did not translate into a reduction in 28-day mortality or progression to severe disease.
    • Progression to severe disease or death at 28 days after enrolment occurred in 44 (19%) of the participants in the intervention arm as compared to 41 (18%) in the control arm.

    What happens if ICMR does remove the therapy from its guidelines?

    • The authorisation of convalescent plasma as a treatment for Covid-19 in India has led to questionable practices such as calls for donors on social media, and the sale of convalescent plasma on the black market.
    • The ICMR has been cautious because of the trial findings.
    • However, those guidelines are not necessarily binding and it is too early to dismiss convalescent plasma therapy. But there are other issues.
    • The therapy involves resource-intensive processes such as plasmapheresis, plasma storage, and measurement of neutralizing antibodies.

    Way ahead

    • This is a new virus, and around the world, the evidence is still emerging on the best therapeutic options.
    • Covid care is individualized care. Use of the right medication on the right patient does work.
    • Some of the therapies can be continued on compassionate grounds.
    • However, the potential harms of the non-immune components of convalescent plasma should be rigorously investigated.
    • Only donor plasma with detectable titers of neutralizing antibodies should be given to trial participants, to ensure that the potential for benefit exists for all intervention arm patients.

    Try this question:

    Q.What is convalescent plasma therapy? Discuss its efficacy and limitations for COVID-19 treatment.

  • Species in news: Echinops Sahyadricus

    Researchers have discovered a new species of Echinops Sahyadricus (Sahyadri Globe Thistle) from the Rajgad Fort in the Sahyadri Mountains.

    Echinops Sahyadricus

    • Echinops is a genus of about 130 species of flowering plants found in tropical and North Africa, the Mediterranean basin and West Asia, extending eastwards to China and Japan.
    • The highest number of taxa (76) is concentrated in the Iranian plateau. Five species are found in India including two in Maharashtra.
    • The new species is unique because of the size of its composite inflorescence which measures up to 9 cm in diameter that is relatively large compared to other Echinops species found around the world.
    • It grows vegetative on open grassy slopes of mountains in four months of monsoon and blooms in November. Fruiting can be seen in December.

  • Reform land ceiling laws

    Land ceiling laws, enacted to deal with the problems of a bygone era, remains unchanged even in most of the States. This has given rise to different problems. The article suggests the relaxation of the ceiling acts to deal with the problem of land degradation and water depletion.

    Background of the ceiling laws

    •  India implemented land ceiling laws to deal with the ‘zamindars’ and impose landowning limits based on total production value of land—irrigated, grove, orchard, dry, etc.
    • Landholdings were scrutinised at individual and family level, and large farms were discouraged.
    • For most states, the ceiling ratio of dry-to-irrigated land is 3:1.

    Issues with the ceiling laws

    • In 2020, State land laws remain unchanged, trapping farm families in a negative ownership trap.
    • As with each generation, the average landholding of individuals reduces.
    • Dropping farm incomes, higher inputs costs, low sale price, soil degradation and water depletion erode production and farm value.
    • A progressive farmer hits production saturation due to limited land.
    • Contract farming has been no consolation either.
    • The result is that the Indian farm size is very small, 86% under two hectares, and is decreasing as the average size of operational holding has declined to 1.08 hectares in 2015-16 versus 1.15 in 2010-11 (Agricultural Census 2015-16).
    • The government is reticent on the Economic Survey’s recommendations to increase land ceiling limits.
    • Recently, Karnataka rescinded land limit reforms.

    How to deal with soil degradation and water depletion

    • 30% of India’s land is degraded, bad agri-practices threaten soil health, and water-guzzling crops like paddy, sugarcane, etc, have resulted in a water crisis in many places.
    • States must study soil conservation program of the US, which paid farmers subsidies for soil conservation or allowing land to be fallow.
    • States should incentivise farmers for agro-ecological plantations and agro-forestry by relaxing land ceiling limits for them.
    • State Acts may include organic plantations under exempt categories similar to tea/rubber plantations.
    • Native biodiversity based mixed orchards, from mahua to moringa, can be encouraged and exempted by state governments.
    • Policy change will have benefits—soil and water rejuvenation, increase in farmers’ incomes and new products for the free market.
    • The return of organic matter and biodiversity will sustain farmland productivity.
    • Plus APEDA predicts a $50 billion organic export 2030, but the cherry would be additional carbon credits.
    • If 10% of arable land converts to organic grove land, India will mitigate climate change and pollution.
    • Each hectare with 0.01% humus can store 80,000 litres of water. We need a central policy to bolster this drive.
    • Farmers may take over waste or degraded land, beyond land ceiling limits, and restore land as a carbon sink and produce more nutrition per acre.
    • As farmers will care for these lands, the government’s financial burden to restore wastelands will lessen.

    Consider the question “Land degradation threatens India’s future if not dealt with in time. In light of this, examine the reasons for soil degradation and suggest the ways to deal with it” 

    Conclusion

    As a nation, we have a choice to steer the bigger farms towards agro-ecology or allow industrial farms to take over rural India. The government needs to bring out a fourth Ordinance to free the land for healing the Earth.

    Source:-

    https://www.financialexpress.com/opinion/reform-land-ceiling-laws-incentivise-farmers-for-agro-ecological-plantations-and-agro-forestry/2113635/

     

     

  • Politics and economics of farm bills

    Reforms in agriculture have been overdue. But the passage of farm bills by the Parliament has evoked opposition from several stakeholders. However, the passage of bills by the Punjab Assembly is the first from any State Assembly. The article explains how politics dominates agriculture reforms and its implications for economic growth.

    States trying the negate the farm bill passed by Parliament

    • By passing its farm bills, Punjab has become the first state to legislate to negate impact of legislation enacted by Parliament last month.
    • Other states like Rajasthan and Chhattisgarh, could follow suit soon.
    • Notwithstanding whether President Ram Nath Kovind gives his assent to the state bills that undermine the central ones, the important issue is to determine how much of this conflict is about economics aimed at helping farmers and how much sheer politics.

    Issues with Punjab’s farm bills

    • Punjab’s farm bills prohibit private players from buying wheat and paddy below the MSP even outside the APMC markets.
    • It doesn’t apply to other crops, say maize, cotton, pulses and oilseeds that are under the ambit of the central MSP system.
    • The point is that this pertains only to wheat and paddy.
    • The bill could even have been extended to milk and vegetables by declaring local MSPs for them, but it didn’t do that.
    • Because the state government knows full well that it will create a fiasco in agri-markets, which might boomerang on it politically.
    • Law for wheat and paddy will not help farmers as the Centre already buys more than 95 per cent of Punjab’s wheat and paddy at MSP through the Food Corporation of India (FCI) and state procurement agencies.

    Economic roots of politics over MSP: Lessons from the past

    • Demand that MSP be made a legal instrument (rather than indicative) actually exhibit deep distrust of the private sector and markets.
    • In1972 government announced that the wholesale trade in wheat and rice (paddy) will be taken over by the government as traders were being unscrupulous in not giving farmers their due MSP and manipulating prices.
    • The first marketing season of the government takeover of wholesale wheat trade, in 1973-74, saw a major fiasco.
    • Market arrivals dropped, and wheat prices shot up by more than 50 per cent. It was a bitter lesson.

    Long overdue reforms in agriculture

    • Economic reforms in 1991 took some time to yield results, but, by the 2000s, India was taking 7 per cent.
    • But even the 1991 economic reforms bypassed agriculture marketing reforms.
    • It was only in 2003, a model act on agri-marketing was circulated to the states.
    • But that model act did not go far enough.
    • From 2004 to 2014 government did not pursue any major agri-marketing reforms.
    • In food government enacted the National Food Security Act in 2013, giving 5 kg wheat or rice to 67 per cent of the population at Rs 2/kg and Rs 3/kg.
    • A high-level committee (HLC) under Shanta Kumar was formed in 2014 to restructure the grain management system.
    • The committee suggested major changes, including cash transfers in the public distribution system, and overhauling the FCI’s operations and free markets to make the system more efficient.
    • But the government could not undertake bold reforms, except some marginal tinkering of labour rules in the FCI.

    Conclusion

    The COVID-19 crisis opened a window of opportunity to reform the agri-marketing system. The government grabbed it — this is somewhat akin to the crisis of 1991 leading to de-licensing of industry. Patience and professionalism will bring rich rewards in due course, not noisy politics.

  • Kisan Suryodaya Yojana

    PM has launched the ‘Kisan Suryodaya Yojana’ aimed at providing day-time electricity to farmers in the State of Gujarat for irrigation and farming purposes.

    Try this question from CSP 2017:

    Q. The term ‘Domestic Content Requirement’ is sometimes seen in the news with reference to-

    (a) Developing solar power production in our country

    (b) Granting licences to foreign T.V. channels in our country

    (c) Exporting our food products to other countries

    (d) Permitting foreign educational institutions to set up their campuses in our country

    Kisan Suryodaya Yojana

    • Under the scheme, farmers will be able to avail power supply from 5am to 9pm for irrigation purposes.
    • Around 234 transmission lines are to be installed under the scheme. Each line is to carry the power of 66 KW. They are to be erected to a total length of 3,490 km.
    • Dahod, Patan, Mahisagar, Panchmahal, Chhota Udepur, Kheda, Tapi, Valsad, Anand and Gir-Somnath have been included under the Scheme for 2020-21.
    • The remaining districts will be covered in a phase-wise manner by 2022-23.

  • Room Temperature Superconductivity

    A study has shown that a new material superconducts at 15 degrees Celsius but at extremely high pressure.

    In India, we often get to hear about the transmission losses in DISCOMS. Such losses can be zeroed with the application of superconducting cables (which is practically impossible unless we find a normal working one). The phenomena, superconductivity, however, is not new to us, UPSC may end up asking some tricky statements in the prelims regarding it.

    What is Superconductivity?

    • A superconductor is a material, such as a pure metal like aluminium or lead, that when cooled to ultra-low temperatures allows electricity to move through it with absolutely zero resistance.
    • Kamerlingh Onnes was the first scientist who figured out exactly how superconductor works in 1911.
    • Simply put, superconductivity occurs when two electrons bind together at low temperatures.
    • They form the building block of superconductors, the Cooper pair.
    • This holds true even for a potential superconductor like lead when it is above a certain temperature.

    What is the new material?

    • A new material composed of carbon, hydrogen and sulphur superconducts at 15 degrees Celsius.
    • However, it needs ultrahigh pressure of about 2 million atmospheres to achieve this transition, putting off any thoughts of application to the future.
    • The pressure they needed was 267 Gigapascals (GPa), or 2.6 million atmospheres.
    • The pressure at the centre of the Earth is 360 GPa, so it is 75% of the pressure at the centre of the Earth.

    What are Superconductors?

    • Superconductors are materials that address this problem by allowing energy to flow efficiently through them without generating unwanted heat.
    • They have great potential and many cost-effective applications.
    • They operate magnetically levitated trains, generate magnetic fields for MRI machines and recently have been used to build quantum computers, though a fully operating one does not yet exist.

    Issues with superconductors

    • They have an essential problem when it comes to other practical applications: They operate at ultra-low temperatures.
    • There are no room-temperature superconductors. That “room-temperature” part is what scientists have been working on for more than a century.
    • The amount of energy needed to cool a material down to its superconducting state is too expensive for daily applications.

  • What is Yellow Dust?

    North Korean authorities have urged citizens to remain indoors to avoid contact with a mysterious cloud of ‘yellow dust’ blowing in from China, which they have warned could bring Covid-19 with it.

    Try this PYQ:

    Q.Consider the following

    1. Birds
    2. Dustblowing
    3. Rain
    4. Windblowing

    Which of the above spread plant diseases?

    (a) 1 and 3 only

    (b) 3 and 4 only

    (c) 1, 2 and 4 only

    (d) 1, 2, 3 and 4

    What is yellow dust?

    • Yellow dust is actually sand from deserts in China and Mongolia that high-speed surface winds carry into both North and South Korea during specific periods every year.
    • The sand particles tend to mix with other toxic substances such as industrial pollutants, as a result of which the ‘yellow dust’ is known to cause a number of respiratory ailments.
    • Usually, when the dust reaches unhealthy levels in the atmosphere, authorities urge people to remain indoors and limit physical activity, particularly heavy exercise and sport.
    • Sometimes, when the concentration of yellow dust in the atmosphere crosses around 800 micrograms/cubic meter, schools are shut and outdoor events cancelled in the affected areas.

  • Species in news: Himalayan Brown Bear

    A recent study has predicted massive habitat decline for the Himalayan brown bear (Ursus arctos isabellinus) by 2050 due to climate change.

    Try this PYQ:

    Q. The Himalayan Range is very rich in species diversity. Which one among the following is the most appropriate reason for this phenomenon?

    (a) It has a high rainfall that supports luxuriant vegetative growth.

    (b) It is a confluence of different bio-geographical zones.

    (c) Exotic and invasive species have not been invasive species have not been introduced in this region.

    (d) It has less human interference.

    Himalayan Brown Bear

    • The Himalayan brown bear is one of the largest carnivores in the highlands of Himalayas.
    • It occupies the higher reaches of the Himalayas in remote, mountainous areas of Pakistan and India, in small and isolated populations, and is extremely rare in many of its ranges.
    • While the brown bear as a species is classified as Least Concern by the IUCN, this subspecies is highly endangered and populations are dwindling.
    • It is ‘Endangered’ in the Himalayas and Critically Endangered in the Hindu Kush.

    What did the study say?

    • The study carried out in the western Himalayas by scientists of Zoological Survey of India, predicted a massive decline of about 73% of the bear’s habitat by the year 2050.
    • These losses in habitat will also result in loss of habitat from 13 protected areas (PAs), and eight of them will become completely uninhabitable by the year 2050, followed by loss of connectivity in the majority of PAs.
    • The study highlights for the need to adopt preemptive spatial planning of PAs in the Himalayan region for the long-term viability of the species.

  • Base Year of CPI- Industrial Workers revised to 2016

    The Labour and Employment Ministry has revised the base year of the Consumer Price Index (CPI) for Industrial Workers (CPI-IW) from 2001 to 2016.

    Why such a move?

    • This revision reflects the changing consumption pattern, giving more weightage to spending on health, education, recreation and other miscellaneous expenses while reducing the weight of food and beverages.

    What is the Consumer Price Index (CPI)?

    • The CPI is a measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care.
    • It is calculated by taking price changes for each item in the predetermined basket of goods and averaging them. Changes in the CPI are used to assess price changes associated with the cost of living.
    • The CPI is one of the most frequently used statistics for identifying periods of inflation or deflation.
    • Essentially it attempts to quantify the aggregate price level in an economy and thus measure the purchasing power of a country’s unit of currency.

    Types of CPI in India

    • CPI in India comprises multiple series classified based on different economic groups.
    • There are four series, viz the CPI UNME (Urban Non-Manual Employee), CPI AL (Agricultural Labourer), CPI RL (Rural Labourer) and CPI IW (Industrial Worker).
    • While the CPI UNME series is published by the Central Statistical Organisation, the others are published by the Department of Labour.
    • From February 2011 the CPI (UNME) released by CSO is replaced as CPI (urban), CPI (rural) and CPI (combined).

    How it is different from WPI?

    • CPI is different from WPI, or Wholesale Price Index, which measures inflation at the wholesale level.
    • While WPI keeps track of the wholesale price of goods, the CPI measures the average price that households pay for a basket of different goods and services.
    • WPI measures and tracks the changes in the price of goods before they reach consumers; goods that are sold in bulk and traded between entities or businesses (rather than consumers).
    • Even as the WPI is used as a key measure of inflation in some economies, the RBI no longer uses it for policy purposes, including setting repo rates.
    • The central bank currently uses CPI or retail inflation as a key measure of inflation to set the monetary and credit policy.

    Major components of WPI

    • Primary articles are a major component of WPI, further subdivided into Food Articles and Non-Food Articles.
    • Food Articles include items such as Cereals, Paddy, Wheat, Pulses, Vegetables, Fruits, Milk, Eggs, Meat & Fish, etc.
    • Non-Food Articles include Oil Seeds, Minerals and Crude Petroleum
    • The next major basket in WPI is Fuel & Power, which tracks price movements in Petrol, Diesel and LPG
    • The biggest basket is Manufactured Goods. It spans across a variety of manufactured products such as Textiles, Apparels, Paper, Chemicals, Plastic, Cement, Metals, and more.
    • Manufactured Goods basket also includes manufactured food products such as Sugar, Tobacco Products, Vegetable and Animal Oils, and Fats.

    Note: WPI has a sub-index called WPI Food Index, which is a combination of the Food Articles from the Primary Articles basket, and the food products from the Manufactured Products basket.

    Now try this PYQ from 2014 CSP:

    Q.With reference to India, consider the following statements:

    1. The Wholesale Price Index (WPI) in India is available on a monthly basis only
    2. As compared to the Consumer Price Index for Industrial Workers (CPI (IW)), the WPI gives less weight to food articles.

    Which of the statements given above is/are correct?

    (a) 1 only

    (b) 2 only

    (c) Both 1 and 2

    (d) Neither 1 nor 2

    Back2Basics: Base Year

    • A base year is the first of a series of years in an economic or financial index. It is typically set to an arbitrary level of 100.
    • Any year can serve as a base year, but analysts typically choose recent years. They are periodically revised to keep data current in a particular index.
    • A base year is used for comparison in the measure of business activity or economic index.
    • For example, to find the rate of inflation between 2013 and 2018, 2013 is the base year or the first year in the time set.