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September 2019

Foreign Policy Watch: India – EU

[op-ed snap] Raja Mandala: Reaching out to Europe


From UPSC perspective, the following things are important :

Prelims level : Alliance for Multilateralism

Mains level : Importance of Eurasia for India


The growing importance of Eurasia for India’s changing geopolitics is evident. Various ideas about Eurasia

  • India does not believe that there is tension between the concepts of Eurasia and the Indo-Pacific. 
  • Russia and China see the “Indo-Pacific” as an effort to contain China.
  • The US believes that the promotion of “Eurasia” is an idea of China and Russia to marginalise the US in the continent.

Indian Ocean

  • India is located at the crossroads of Asia and at the heart of the Indian Ocean. 
  • India sees itself as a maritime power in the Indo-Pacific with interests in continental Eurasia. 
  • Thus Europe is seen as the right partner in overcoming the presumed tension between the two concepts. 
  • The importance of India’s new alliance with France is highlighted through IN-FRA, which is critical for India in both the maritime and continental domains.

How a partnership with Indo-Pacific helps

  • Renewed tensions between Russia and the West have reduced chances for India to maneuver. France is leading a new effort to ease the conflict between Russia and the West. 
  • Russia was suspended from the G8 forum after its intervention in Ukraine in 2014. France and Germany are planning to make a fresh bid to resolve the European stand-off with Russia on Ukraine.
  • Japan has consistently sought to resolve the long-standing territorial dispute with Russia and make Moscow a partner in the Japanese strategy for the Indo-Pacific. 
  • France is ready to work with India in developing new coalitions to stabilise the Indo-Pacific. It wants to prevent the littoral from becoming a hostage to the vagaries of US-China relations.
  • US-China tensions over trade. India should support the initiative by France, Japan and others to save the global trading system through much-needed reforms. Working with Europe and Japan might lend greater weight and credence to India’s trade diplomacy.
  • India has a strong interest in joining the “Alliance for Multilateralism” that calls for modernising international institutions, strengthening the rules-based order and promoting global, rather than national, solutions to global challenges.

Way ahead

  • India should also elevate Central Europe in the list of diplomatic priorities.
  • There is room for expanding cooperation between India and the Central European states. India’s traditional method of engaging Europe through big powers has neglected the enormous possibilities for mutual enrichment with other European states as well as the European Union. 
  • No prime minister has visited Hungary since Rajiv Gandhi in 1988 and Poland since Morarji Desai in 1979, underlines India’s strategic neglect of Central Europe all these decades. 



Alliance for Multilateralism

  • It is a German initiative backed by France.
  • It does not include the US, Russia, and China, but is drawing many middle powers like Japan and Canada in the developed world and South Africa in the developing world.
  • The alliance is set to be launched later this month on the margins of the annual session of the UN General Assembly in New York. 

Issues related to Economic growth

[op-ed snap] An intensifying whimper that has begun to take a global toll


From UPSC perspective, the following things are important :

Prelims level : Nothing much

Mains level : Global economic slowdown


News show signs of another economic crisis and stock market decline.


  • The economic situation around the world is rather grim. From synchronized global growth in the first half of 2017, we are now in the midst of a synchronized slowdown exacerbated by the US-China trade war.
  • Merval Stock Market dropped 48% in a single day and the peso has fallen by 85% over the last three years.
  • Many countries in Europe have been or have now fallen into negative interest rates, with Switzerland, Denmark, Sweden, and the Eurozone all with minus signs on interest rates.
  • Countries that account for almost a quarter of total global output now have central banks with policy rates set below zero. 
  • The amount of “sub-zero” debt, that is debt with negative interest rates, is at an all-time high of $15 trillion. 
  • Europe’s slowdown is fully demonstrated by the entire German yield curve going below zero last month. 
  • The US economy has lost steam. Real growth is tapering towards 2% on an annualized basis. US consumer sentiment is still there because of low unemployment despite businesses being much more cautious about exports and capital expenditure. 

What is the issue

  • Large parts of the world are starting from negative interest rates. 
  • This means that monetary policy stimulus as a method to combat the slowdown is rendered largely ineffective, and central banks in Europe, Japan, and the US may have to once again increase the size of their balance sheets. 
  • The only other choice is to use fiscal expansion to counter the slowdown. 
  • A third choice is to take the impact of the slowdown without too much of a cushion, but democracies are ill-equipped to deal with the negative political reaction to prolonged recessions.
  • For emerging markets affected by the taper tantrum and now by this synchronized slowdown, it is not good news. 


  • Despite significant variations in global growth, oil prices have ranged between $50 and $70 a barrel over the last few years. So, the pressure on India’s balance of payment (BoP) has stayed.
  • China weakened its currency to combat the trade war, and India is left with little choice than to weaken the rupee in step. 
  • A weakening rupee would reduce India’s flexibility to dramatically decrease interest rates.

Way ahead

  • India must use any window of opportunity to undertake any structural reforms that present themselves. 
  • Low oil prices, good global growth, and moderate inflation are such windows. 
  • India’s medium-term economic growth be supported by favorable demographics.
  • In the short-term government may not undertake deep structural reforms that may impact growth and employment. 
  • A clever cocktail of a stimulus and structural reforms is needed. 
    1. The stimulus should take the form of government infrastructure investment and incentivization of the private sector to invest funds. 
    2. Reforms must focus on factor markets and on the ease of conducting business.

Blockchain Technology: Prospects and Challenges

[op-ed snap] Cryptocurrencies could constrain a country’s choices


From UPSC perspective, the following things are important :

Prelims level : Bitcoins

Mains level : Libra; cryptocurrency and impact on monetary policies


Facebook announced launching a cryptocurrency called Libra, designed to appeal to its global user base of over 2 billion. 


  • It will be backed by a basket of fiat currencies. 
  • It is supported by a consortium of large-scale corporate houses, financial services firms, and venture capitalists. 
  • Millennials have little patience for expensive traditional banking methods for cash transactions. They would likely flock to alternatives like Libra.

Impossible trinity

  • It is the “trilemma” of monetary policy. It states that it is impossible to have all three of the following conditions fulfilled at the same time: 
    1. a fixed foreign exchange rate
    2. free capital movement
    3. an independent monetary policy 
  • Even before cryptocurrencies, governments looking to control the monetary aspects of their economies have been subject to this trilemma, and have been forced to implement only two of the three conditions.
  • If you want control over both your exchange rate and monetary policy, you would have to impose controls on free capital movement. 
  • Hence the existence of capital controls such as India’s Foreign Exchange Management Act.
  • The trilemma is a theory based on the “uncovered interest rate parity condition”.
  • It is supported by evidence-based studies where governments that have tried to simultaneously pursue all three goals have failed. 
  • Uncovered interest rate parity condition means that if a dollar can only fetch a 1% rate of return in the US, but 6% in India, investors are bound to move from dollars to rupees. The reason they don’t is that the differential of 5% will likely reduce to zero as a result of a slide in the rupee’s value to the extent of its current interest differential against the dollar.
  • Strong capital controls have meant that other means of payment have been in use before, such as the infamous “hawala” system. 
  • The ease of use and the scope of new Big-Tech cryptocurrencies are about to create global currencies of a completely different class. 
  • Economists argue that such currencies will affect the exchange rates and monetary policies of traditional currencies. This is because the introduction of a global digital currency removes the capital control levers that sovereign nations have today.

A case

  • If we assume a two-country system, both using their own national currencies as well as a global cryptocurrency.
  • Assuming markets are efficient and complete, and that the global cryptocurrency is freely used in both countries, they show that the interest rates in both countries must necessarily be equal, and the exchange rate between the two countries becomes a “martingale” – the best predictor of tomorrow’s value is today’s value.
  • This adds a further restriction to the impossible trinity, making it a dilemma. 


Thus the advent of Big Tech cryptocurrencies means that countries would have one less lever to pull.



Blockchain Technology and Bitcoins

History- Important places, persons in news

Explained: When India’s interim government was formed in 1946


From UPSC perspective, the following things are important :

Prelims level : India's first interim cabinet

Mains level : Read the attached story


  • On this day in 1946, the interim government of India led by Jawaharlal Nehru was formed.
  • It was the only such cabinet in India’s history in which arch-rivals Congress and the Muslim League shared power at the Centre.
  • The interim government functioned with a great degree of autonomy, and remained in power until the end of British rule, after which it was succeeded by the Dominions of India and Pakistan.

Formation of India’s interim government 

  • Starting with the Cripps mission in 1942, a number of attempts were made by colonial authorities to form an interim government in India.
  • In 1946, elections to the Constituent Assembly were held following the proposals of the British Cabinet Mission dispatched by the British Prime Minister Clement Attlee.
  • In this election, the Congress obtained a majority in the Assembly, and the Muslim League consolidated its support among the Muslim electorate.
  • Viceroy Wavell subsequently called upon Indian representatives to join the interim government.
  • A federal scheme had been visualized under the Government of India Act of 1935, but this component was never implemented due to the opposition from India’s princely states.
  • As a result, the interim government functioned according to the older Government of India Act of 1919.

The interim cabinet

  • On September 2, 1946, the Congress party formed the government. On September 23, the All-India Congress Committee (AICC) ratified the Congress Working Committee’s decision.
  • The Muslim League initially decided to sit out of the government, and three of the five ministries reserved for Muslims were occupied by Asaf Ali, Sir Shafaat Ahmad Khan, and Syed Ali Zaheer, all non-League Muslim representatives.
  • Two posts remained vacant.
  • However, after Lord Wavell agreed to allot all five reserved portfolios to the Muslim League if it agreed to cooperate, the latter finally joined.
  • In October, the cabinet was reshuffled to accommodate the new Muslim League members, and Sarat Chandra Bose, Sir Shafaat Ahmad Khan and Syed Ali Zaheer from the earlier team were dropped. Baldev Singh, C.H. Bhabha, and John Matthai continued to represent minority communities.

The cabinet after October 1946 was as follows:


  • Vice President of the Executive Council, External Affairs and Commonwealth Relations: Jawaharlal Nehru
  • Home Affairs, Information and Broadcasting: Vallabhbhai Patel
  • Agriculture and Food: Rajendra Prasad
  • Education and Arts: C. Rajagopalachari
  • Defence: Baldev Singh
  • Industries and Supplies: C. Rajagopalachari
  • Labour: Jagjivan Ram
  • Railways and Communications: Asaf Ali
  • Work, Mines and Power: C.H. Bhabha


  • Commerce: Ibrahim Ismail Chundrigar
  • Finance: Liaquat Ali Khan
  • Health: Ghazanfar Ali Khan
  • Law: Jogendra Nath Mandal
  • Posts and Air: Abdur Rab Nishtar

Some of the decisions by the cabinet

  • In November 1946, India ratified the Convention on International Civil Aviation.
  • In the same month, a committee was appointed to advise the government on nationalizing the armed forces.
  • In December, Maulana Abul Kalam Azad was inducted into the cabinet.

Major Work

Dawn of Indian Diplomacy

  • On September 26, 1946, Nehru declared the government’s plan to engage in direct diplomatic relations with all countries and goodwill missions.
  • The year 1947 saw the opening of diplomatic channels between India and many countries.
  • In April 1947, the US announced the appointment of Dr. Henry F. Grady as its ambassador to India.
  • Embassy level diplomatic relations with the USSR and the Netherlands also started in April.
  • In May, the first Chinese ambassador Dr. Lo Chia Luen arrived, and the Belgian Consul-General in Kolkata was appointed Belgium’s ambassador to India.
  • On June 1, the Indian Commonwealth Relations Department and the External Affairs Department were merged to form the single Department of External Affairs and Commonwealth Relations.

Managing Partition

  • After Partition was announced on June 3, a dedicated cabinet sub-committee was formed to deal with the situation on June 5, and consisted of Jawaharlal Nehru, Sardar Vallabhai Patel, Liaquat Ali Khan, Abdur Rab Nishtar and Baldev Singh.
  • Later, on June 16, a special cabinet committee aimed at tackling the administrative consequences of Partition was created.
  • It included the Viceroy, Sardar Vallabhai Patel, Rajendra Prasad, Liaquat Ali Khan, and Abdur Rab Nishtar.
  • This committee was later replaced by a Partition Council.

Foreign Policy Watch: India-China

Tibetan Democracy Day, its meaning and significance


From UPSC perspective, the following things are important :

Prelims level : Read the attached story

Mains level : India-China Relations in context of Tibet

  • The Tibetan Government-in-Exile celebrated its 59th Democracy Day at the McLeodganj monastery on September 2.
  • This day marks the anniversary of the establishment of the democratic system of the Tibetan people living in exile in India.

Tibetan Democracy Day

  • In February 1960, a little less than a year after he crossed over into India, the Fourteenth Dalai Lama outlined in Bodh Gaya, where The Buddha attained Enlightenment, a detailed programme of democratic practice for exiled Tibetans.
  • According to the website of the Tibetan Parliament-in-Exile (TPiE), he advised them to set up an elected body with three exiled representatives each from the three provinces, and one each from the four religious schools of Tibetan Buddhism.
  • After elections were held, 13 elected representatives, called ‘Deputies’, were designated as the ‘Commission of Tibetan People’s Deputies’ (CTPD). They took oath on September 2, 1960.
  • Subsequently from 1975 onward, this date began to be formally observed as Tibetan Democracy Day.


  • The TPiE is the highest legislative body of the Central Tibetan Administration (CTA).
  • It is described as one of the three pillars of Tibetan democratic governance — the others being the Judiciary and the Kashag, or Executive.
  • The website of the TPiE underlines the Dalai Lama’s commitment to the democratic principle — it quotes the Dalai Lama from the Foreword to the Constitution for Tibet, drafted in 1963:
  • The CTA is based in Dharamsala, Himachal Pradesh.
  • Elections are held every five years to elect Members of the TPiE, and their Sikyong (Prime Minister). The 16th TPiE was elected in 2016.
  • This was the second direct election after the Dalai Lama distanced himself from the political functioning of the TPiE in 2011.

The Government-in-Exile

  • On March 10, 1963, the Dalai Lama promulgated the Constitution of the Tibetan Government-in-Exile (TGiE).
  • From 1991 onwards, TPiE became the legislative organ of the CTA, the Tibetan Supreme Justice Commission became the judicial organ, and the Kashag the executive organ.
  • The TGiE is not recognised officially by any country, including India.
  • However, many countries, including the US, deal directly with the Sikyong and other Tibetan leaders through various forums.
  • The TPiE says its democratically elected character helps it manage Tibetan affairs, and raise the Tibetan issue across the world.
  • The current Sikyong (known as Kalön Tripa until 2012) of the CTA is Lobsang Sangay, who has been the head of the Kashag or Cabinet (first as Kalön Tripa and then as Sikyong) since 2011.

Police Reforms – SC directives, NPC, other committees reports

Interpol General Assembly


From UPSC perspective, the following things are important :

Prelims level : INTERPOL

Mains level : INTERPOL and its mandate

  • India has proposed to Interpol that the General Assembly of the organization be held in New Delhi in 2022 as part of the nation’s 75th Independence Day celebrations.

The Interpol

  • The Interpol (International Criminal Police Organisation) is a 194-member intergovernmental organisation headquartered in Lyon, France.
  • It was formed in 1923 as the International Criminal Police Commission, and started calling itself Interpol in 1956.
  • India joined the organisation in 1949 (1956 as per wiki), and is one of its oldest members.
  • Interpol aims to “help police in all… (its member countries) to work together to make the world a safer place”.
  • It enables police forces from different countries to share and access data on crimes and criminals, and offers a “range of technical and operational support”.
  • Interpol’s declared global policing goals include countering terrorism, promoting border integrity worldwide, protection of vulnerable communities, providing a secure cyberspace for people and businesses, curbing illicit markets, supporting environment security, and promoting global integrity.

General Assembly

  • The General Assembly is Interpol’s supreme governing body, and comprises representatives from all its member countries.
  • The General Assembly meets annually for a session lasting approximately four days, to vote on activities and policy.
  • Each country is represented by one or more delegates at the Assembly, who are typically chiefs of law enforcement agencies.
  • The General Assembly also elects the members of the Interpol Executive Committee, the governing body which “provides guidance and direction in between sessions of the Assembly”.
  • Major trends in crime and security threats facing the world are also discussed.

Assembly Resolutions

  • The General Assembly’s decisions take the form of Resolutions.
  • Each member country has one vote.
  • Decisions are made either by a simple or a two-thirds majority, depending on the subject matter.
  • General Assembly Resolutions are public documents.
  • Interpol recognises that “as the largest global gathering of senior law enforcement officials, the General Assembly also provides an important opportunity for countries to network and share experiences”.

Assembly hosts

  • The Interpol’s 88th General Assembly will assemble in Santiago, Chile, later this year.
  • The 2018 (87th), 2017 (86th), 2016 (85th), and 2015 (84th) General Assemblies met in Dubai, UAE, Beijing, China, Bali, Indonesia, and Kigali, Rwanda, respectively.
  • Kim Jong Yang of South Korea was elected president of Interpol for a two-year term until 2020 by the General Assembly in Dubai.
  • The Secretary General of Interpol since 2014 has been Jürgen Stock of Germany.
  • He is the organisation’s senior full-time official who oversees the day-to-day running of the Interpol General Secretariat. (Stock met Union Home Minister in New Delhi last week.)

Innovations in Biotechnology and Medical Sciences

Genome sequencing of bacteria to help with biocontrol in farming


From UPSC perspective, the following things are important :

Prelims level : Biocontrol

Mains level : Read the attached story

Bacteria with antimicrobial properties

  • Scientists in Kerala have completed the whole genome sequencing of a rare bacterium capable of producing antifungal and insecticidal compounds.
  • This has opened up the potential to develop a new line of products for biocontrol applications in agriculture.

Obtained from soil

  • Researchers isolated some strains of actinomycetes (a kind of hairy bacteria) from the forest soils of the Neyyar wildlife sanctuary, one of the 12 mega diversity centres in the world.
  • One of the isolates was identified as Streptosporangium nondiastaticum reported to have antimicrobial properties.

Helping Biocontrol

  • Bioinformatics analysis showed that the genome contained a plant chitinase, an enzyme capable of degrading fungi and insect exoskeleton.
  • The scientists have cloned the gene and engineered the recombinant protein.
  • The strain can produce metabolytes that are toxic to plant pathogens, making it a candidate for biocontrol applications.
  • Across the world, fungal phytopathogens cause significant agricultural crop loss, both in farmlands and post-harvest storage conditions.
  • The use of micro organisms to control phytopathogens and pests offers an important alternative to chemical fungicides and pesticides which result in environmental pollution and development of resistance in fungal pathogens.

Food Processing Industry: Issues and Developments

“Reducing Food Loss and Waste” Report


From UPSC perspective, the following things are important :

Prelims level : About the report

Mains level : Food Wastage

“Reducing Food Loss and Waste” Report

  • It is a new report published by the World Resources Institute (WRI) with the support of the Rockefeller Foundation.
  • It has quantified global food wastage.
  • It put forward a Global Action Agenda that calls on governments, companies, farmers and consumers to collectively overcome “the world’s food loss and waste problem.”
  • Some of these actions include developing national strategies for food loss and waste reduction, creating national PPP, launch supply chain initiatives, reducing small-holder losses and shifting consumer social norms.

Globally uneaten food

  • Nearly one-third of the food that is produced each year goes uneaten, costing the global economy over $940 billion.
  • The uneaten food is responsible for emitting about 8 per cent of planet-warming greenhouse gases into the atmosphere, said the report.
  • Referencing “numerous studies”, the report said most of the food loss happens “near the farm” predominantly in lower-income countries.
  • And most of the food waste happens “near the plate” predominantly in higher-income countries.

Most perishable items

  • Fruits and vegetables follow, with over 41%.
  • When viewed as a proportion, by weight, of all the food estimated to be lost and wasted globally, fruits and vegetables make up the largest share of total annual food loss and waste.
  • Using data from the Food and Agriculture Organization of the UN, the report concluded that roots and tubers are the food group that face the maximum wastage, at over 62% for 2007.

Coal and Mining Sector

‘Samudrayaan’ Project


From UPSC perspective, the following things are important :

Prelims level : ‘Samudrayaan’ Project

Mains level : India's Deep Ocean Mission

  • India’s ambition to send men to the deep sea in a submersible vehicle is likely to be a reality in 2021-22 with the ‘Samudrayaan’ project.
  • It will be a part of the ‘Deep Ocean Mission’ that has received in-principle approval but is awaiting a final nod from the Union Finance Ministry.

‘Samudrayaan’ project

  • The ‘Samudrayaan’ is a part of the Ministry of Earth Sciences’ pilot project for deep ocean mining for rare minerals.
  • The project proposes to send a submersible vehicle with three persons to a depth of about 6000 metres to carry out deep underwater studies.
  • The project is undertaken by the National Institute of Ocean Technology (NIOT), Chennai in line with the ISRO’s ambitious ‘Gaganyaan’ mission of sending an astronaut to space by 2022.
  • The indigenously developed vehicle is capable of crawling on the sea bed at a depth of six kilometre for 72 hours.
  • The project proposes to carry three persons in a submersible vehicle to a depth of 6000 metres under sea for various studies. Submarines go only about 200 metres.

Why such mission?

  • India has been allocated a site of 75,000 sq km in the Central Indian Ocean Basin by the International Sea Bed Authority for exploration of polymetallic nodules from seabed.
  • The estimated resource of polymetallic nodules is about 380 million tonnes, containing 4.7 million tonnes of nickel, 4.29 million tonnes of copper and 0.55 million tonnes of cobalt and 92.59 million tonnes of manganese.


  • The success of the ‘Samudrayaan’ will help India to join the league of developed nations in exploration of minerals from oceans.
  • Such missions had already been carried by developed countries and India could be the first among the developing nations.

Waste Management – SWM Rules, EWM Rules, etc

[pib] Project REPLAN


From UPSC perspective, the following things are important :

Prelims level : Project REPLAN

Mains level : Measures to curb use of plastic

  • Khadi and Village Industries Commission (KVIC) launched a first ever ‘Terracotta Grinder’ in Varanasi.

About the grinder

  • The grinder was designed by KVIC Chairman, and fabricated by a Rajkot-based engineering unit
  • This machine will grind the wasted and broken pottery items for re-using in pottery-making.
  • Earlier the wasted pottery items were grinded in normal khal-musal (mortar and pestle) and its fine powder was mixed with the normal clay.
  • Mixing this powder in stipulated ratio to normal clay makes the resulting pottery items stronger.
  • This Terracotta grinder will make grinding of wasted pottery items faster than the traditional mortar and pestle.
  • It will lessen the cost of production, and will also help in solving the problem of shortage of clays.
  • By mixing 20 percent of this wasted terracotta powder, the potter will make a saving of at least Rs 520.  This will also create more job opportunities in the villages.

Project REPLAN (REducing PLAstic in Nature)

  • KVIC, as part of its commitment to Swachh Bharat Abhiyaan, had started manufacturing of plastic-mixed handmade paper under its project REPLAN (REducing PLAstic in Nature).
  • In this project, the waste plastic is collected, cleaned, chopped, beaten and treated for softness.
  • After that, it is mixed with the paper raw material i.e. cotton rags pulp in a ratio of 80 % (pulp) and 20% (plastic waste).
  • The institute has sold over six lakh handmade plastic mixed carry bags since September 2018.