November 2021
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Economic Indicators and Various Reports On It- GDP, FD, EODB, WIR etc

Mixed signals on growth-inflation dynamics

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much

Mains level: Paper 3- Recovery momentum

Context

We are now at that point in the cycle where all central banks — the RBI, the US Fed, the European Central Bank, Bank of England and others — have begun to signal, a process of normalisation from the unprecedented loose monetary policy stimulus post the onset of the pandemic in early 2020.

Recovery momentum

  • Surveys and data prints are now signalling that the recovery momentum in the first half of 2021 is decelerating in many countries, although the direction and momentum may vary.
  • The RBI Governor notes that “the external environment, which had been supportive of aggregate demand over the past few months, may lose momentum for a variety of reasons”.
  • China — its policy and economy — is the most salient risk for a sustained global recovery.
  • The Chinese authorities’ seeming determination to push ahead with structural reforms, de-carbonising initiatives, and curbs on real estate appear designed to sacrifice some short-term growth for medium-term efficiencies, and reduce financial risks and inequality.
  • Inflation in almost all major economies continues to remain high.
  • The US Personal Consumption Expenditure (PCE) survey measure of core inflation is running over 4 per cent.
  • The story is similar in Europe.

Assessing India’s growth recovery

  • India’s growth–inflation dynamics are also becoming favourable, but are still subject to multiple risks.
  • In assessing India’s growth recovery, a risk of the global economy going into “stagflation”, going by US signals seems to be that if at all, it is likely to be mild.
  • The recovery of economic activity continues, although the high-frequency indicators we track suggest that the momentum observed in July and August has moderated.
  • Electricity consumption growth is also down from August levels, but part of this can be explained by both cooler, rainy weather, as well as coal shortage related cutbacks in many electricity-intensive manufacturing.
  • The residential real estate is reportedly doing exceptionally well, with low-interest rates on home loans, cuts in stamp duty and registration charges, and indeed behavioural shifts towards own home ownerships with hybrid and work from home shifts.
  • Even the commercial real estate sector is reviving.
  • The Union government also has large unspent cash balances, which can be judiciously deployed to boost both capex and consumption.
  • The overall inflation trajectory suggests a gradual glide path towards the 4 per cent target by March 2023 or a bit beyond.
  • There are risks of overshooting this forecast trajectory, despite a benign outlook on food prices.
  • This emanates from global metals, minerals, crude oil prices, and from supply bottlenecks persisting till well into 2022.

Conclusion

In summary, the growth–inflation signals remain mixed. Multiple episodes of global spillovers in the past couple of decades have taught us that imminent normalisation will have implications for all emerging markets.

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Important Judgements In News

The Supreme Court is walking the talk on citizens’ rights

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Right to privacy and judicial review

Mains level: Paper 2- Balancing the fundamental rights of the citizens with national security concerns

Context

When the bench of the Chief Justice of India passed an order appointing a committee in the Pegasus matter, it served the interest of every Indian.

What led to the appointment of committee by the Supreme Court

  • Pegasus has allegedly been used against politicians and individuals across the globe, including against politicians, journalists and other private individuals in India.
  • The issue rocked Parliament, but the government was not willing to share any information pertaining to the software or its use, citing national security as a reason.
  • The alleged victims of the software turned to the Supreme Court, and prayed for setting up of an independent enquiry.
  • The government, on being called upon by the Supreme Court, cited national security, contending that any information it let out would become a matter of public debate, which could be used by terror groups to hamper national security.
  • Its unrelenting stand left the court with no option but to take a call on whether to blindly accept the government’s refusal to share no information whatsoever, or lean in favour of a citizen’s right to privacy, a fundamental right guaranteed under the Constitution.
  • The Supreme Court chose the latter course.

Balancing the fundamental rights  nad judicial review with national security

  • The Supreme Court has observed that “the state cannot get a free pass every time the spectre of national security is raised”.
  • It goes on to say that national security “cannot be the bugbear that the judiciary shies away from, by virtue of its mere mentioning. Although this court should be circumspect in encroaching upon the domain of national security, no omnibus prohibition can be called for against judicial review”.

Conclusion

The Pegasus order upholding the individual’s right to a life of dignity and privacy, is music to the ears of those who believe in constitutional values and rule of law.
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Climate Change Negotiations – UNFCCC, COP, Other Conventions and Protocols

India offers ‘Panchamrita’ Strategy for Climate Conundrum at Glasgow

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Panchamrita

Mains level: India's INDC

PM Modi has proposed a five-fold strategy called the ‘Panchamrita’ for India to play its part in helping the world get closer to 1.5 degrees Celsius on the first day of the global climate meeting in Glasgow.

What is Panchamrita?

  • ‘Panchamrita’ is a traditional method of mixing five natural foods — milk, ghee, curd, honey and jaggery. These are used in Hindu and Jain worship rituals. It is also used as a technique in Ayurveda.
  • The PM euphemistically termed his scheme as ‘Panchamrita’ meaning the ‘five ambrosia’.
  • Under Panchamrita’, India will:
  1. Get its non-fossil energy capacity to 500 gigawatts by 2030
  2. Meet 50 per cent of its energy requirements till 2030 with renewable energy
  3. Reduce its projected carbon emission by one billion tonnes by 2030
  4. Reduce the carbon intensity of its economy by 45 per cent by 2030
  5. Achieve net zero by 2070

Key takeaways of PM’s speech

(a) Commitment for climate action

  • India consists of 17 per cent of the world’s population but contribute only five per cent of emissions.
  • Yet, it has left no stone unturned in doing our bit to fight climate change.
  • At Paris, India was making promises not to the world but to itself and 1.3 billion Indians, PM said.

(b) Climate finance

  • The 2015 Paris CoP where the Paris Agreement was signed was not a summit but a sentiment.
  • The promises made till now on climate finance were useless.
  • When we all are increasing our ambitions on climate action, the world’s ambition could not stay the same on climate finance as was agreed at the time of Paris.

(c) India’s track record

  • India was fourth as far as installed renewable energy capacity was concerned.
  • The Indian Railways has pledged to make itself net-zero by 2030. This will result in an annual 60 million tonnes reduction in emissions.
  • India initiated the International Solar Alliance for solar energy.
  • It has also set up the coalition for disaster resilient infrastructure for climate adaptation.

 

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Climate Change Impact on India and World – International Reports, Key Observations, etc.

[pib] BASIC Countries

Note4Students

From UPSC perspective, the following things are important :

Prelims level: BASIC Countries, Copenhagen Accord

Mains level: Not Much

The Union Environment Minister has delivered the statement on behalf of the BASIC group of countries at the UN Climate Change Conference underway at Glasgow.

Who are the BASIC Countries?

  • The BASIC countries (also Basic countries or BASIC) are a bloc of four large newly industrialized countriesBrazil, South Africa, India and China.
  • It was formed by an agreement on 28 November 2009.
  • The four committed to act jointly at the Copenhagen climate summit, including a possible united walk-out if their common minimum position was not met by the developed nations.
  • This emerging geopolitical alliance, initiated and led by China, then brokered the final Copenhagen Accord with the United States.

What is the Copenhagen Accord?

  • The Copenhagen Accord is a document signed at COP 15 to the UNFCCC on 18 December 2009.
  • The Accord states that global warming should be limited to below 2.0 °C (3.6 °F).
  • It does not specify what the baseline is for these temperature targets (e.g., relative to pre-industrial or 1990 temperatures).
  • In January 2010, the Accord was described merely as a political agreement and not legally binding, as is argued by the US and Europe.
  • It is not legally binding and does not commit countries to agree to a binding successor to the Kyoto Protocol, whose round ended in 2012.
  • According to the UNFCCC, these targets are relative to pre-industrial temperatures.

 

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Wildlife Conservation Efforts

Guidelines released for safe rescue, release of Ganges River Dolphins (GRDs)

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Gangetic Dolphin

Mains level: Not Much

The Jal Shakti Ministry has released a guide for the safe rescue and release of stranded Ganges River Dolphins.

Gangetic Dolphin

  • The Gangetic river system is home to a vast variety of aquatic life, including the Gangetic dolphin (Platanista gangetica).
  • The species, whose global population is estimated at 4,000, are (nearly 80%) found in the Indian subcontinent.
  • It is found mainly in the Indian subcontinent, particularly in Ganga-Brahmaputra-Meghna and Karnaphuli-Sangu river systems.
  • It is one of five species of river dolphin found around the world.
  • Only three species of freshwater dolphins are remaining on the earth after the functional extinction of the Chinese river Dolphin (Baiji) in 2006.

Conservation status

  1. The GRDs have been designated the National Aquatic Animal of India since 2010.
  • It is listed as:
  1. Endangered under IUCN Red List
  2. Schedule I of the Indian Wildlife (Protection) Act (1972)
  3. Appendix I of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES)

About the guidelines

  • The document has been prepared by the Turtle Survival Alliance, India Program and Environment, Forest and Climate Change Department (EFCCD), Uttar Pradesh.
  • The guide has been drawn from years of experience of the organization while rescuing 25 Ganges River Dolphins (GRDs) stranded in irrigation canals.

Various threats

  • They often accidentally enter canal channels in northern India and are often entrapped, and die as they are unable to swim up against the gradient.
  • They are eventually harassed by the locals.
  • Opportunistic poaching for meat and oil in certain pockets of the country is another big threat.

 

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