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Archives: News

  • Oil and Gas Sector – HELP, Open Acreage Policy, etc.

    OPEC+ seeks consensus on oil output

    OPEC+ has failed to reach a deal on oil output policy because the United Arab Emirates blocked some aspects of the pact.

    About OPEC

    • OPEC is a permanent, intergovernmental organization, created at the Baghdad Conference in 1960, by Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela.
    • It aims to manage the supply of oil in an effort to set the price of oil in the world market, in order to avoid fluctuations that might affect the economies of both producing and purchasing countries.
    • It is headquartered in Vienna, Austria.
    • OPEC membership is open to any country that is a substantial exporter of oil and which shares the ideals of the organization.
    • Today OPEC is a cartel that includes 14 nations, predominantly from the middle east whose sole responsibility is to control prices and moderate supply.

    What is OPEC+?

    • The non-OPEC countries which export crude oil along with the 14 OPECs are termed as OPEC plus countries.
    • OPEC plus countries include Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Russia, South Sudan, and Sudan.
    • Saudi and Russia, both have been at the heart of a three-year alliance of oil producers known as OPEC Plus — which now includes 11 OPEC members and 10 non-OPEC nations — that aims to shore up oil prices with production cuts.

    Must read:

    [Burning Issue] Oil Prices and OPEC+

    Concerns for India

    • Rising oil prices are posing fiscal challenges for India, where heavily-taxed retail fuel prices have touched record highs, threatening the demand-driven recovery.
    • India imports about 84% of its oil and relies on West Asian supplies to meet over three-fifths of its demand.
    • As one of the largest crude-consuming countries, India is concerned that such actions by producing countries have the potential to undermine consumption-led recovery.
    • This would hurt consumers, especially in our price-sensitive market.

    Answer this PYQ in the comment box:

    Q.The term ‘West Texas Intermediate’, sometimes found in news, refers to a grade of (CSP 2020):

    (a) Crude oil

    (b) Bullion

    (c) Rare earth elements

    (d) Uranium

  • Gravitational Wave Observations

    Black Hole swallows Neutron Star

    In an entirely strange phenomenon, astronomers have spotted two neutron stars being swallowed by different black holes.

    What are Black Holes?

    • A black hole is a region of spacetime where gravity is so strong that nothing—no particles or even electromagnetic radiation such as light—can escape from it.
    • Neutron stars and black holes are among the most extreme objects in the universe. They are the fossil relics of massive dead stars.
    • When a star that is more than eight times as massive as the Sun runs out of fuel, it undergoes a spectacular explosion called a supernova.
    • What remains can be a neutron star or a black hole.

    There is no upper limit to how massive a black hole can be, but all black holes have two things in common: a point of no return at their surface called an “event horizon”, from which not even light can escape and a point at their centre called a “singularity”, at which the laws of physics as we understand them break down.

    What about Neutron stars?

    • Neutron stars are typically between 1.5 and two times as massive as the Sun but are so dense that all their mass is packed into an object the size of a city.
    • At this density, atoms can no longer sustain their structure and dissolve into a stream of free quarks and gluons: the building blocks of protons and neutrons.

    What is the news observation?

    • Gravitational waves are produced when celestial objects collide and the ensuing energy creates ripples in the fabric of space-time which carry all the way to detectors on Earth.
    • The reverberations from the two celestial objects were picked up using a global network of gravitational wave detectors.

    What makes this strange phenomenon?

    • This is the first time scientists have seen gravitational waves from a neutron star and a black hole.
    • Previous gravitational wave detections have spotted black holes colliding, and neutron stars merging but not one of each.

    Why study this?

    • Neutron star-black hole systems allow us to piece together the evolutionary history of stars.
    • Gravitational-wave astronomers are like stellar fossil-hunters, using the relics of exploded stars to understand how massive stars form, live and die.

    Answer this PYQ in the comment box:

    Q.“Event Horizon” is related to (CSP 2018):

    (a) Telescope

    (b) Black hole

    (c) Solar glares

    (d) None of the above

  • Forest Conservation Efforts – NFP, Western Ghats, etc.

    [pib] Project BOLD

    The Khadi and Village Industries Commission (KVIC) has launched the unique Project Bamboo Oasis on Lands in Drought (BOLD) in Rajasthan.

    Project BOLD

    • Project BOLD seeks to create bamboo-based green patches in arid and semi-arid land zones.
    • It is a unique scientific exercise serving the combined national objectives of reducing desertification and providing livelihood and multi-disciplinary rural industry support.
    • 5000 saplings of special bamboo species: Bambusa-Tulda and Bambusa-Polymorpha specially brought from Assam – have been planted over 25 bigha (16 acres approx) of vacant arid Gram Panchayat land.
    • KVIC has thus created a world record of planting the highest number of bamboo saplings on a single day at one location.

    Why Bamboo?

    • KVIC has judiciously chosen bamboo for developing green patches.
    • Bamboos grow very fast and in about three years’ time, they could be harvested.
    • Bamboos are also known for conserving water and reducing evaporation of water from the land surface, which is an important feature in arid and drought-prone regions.

    Significance of the move

    • The project will help in reducing the land degradation percentage of the country, while on the other hand, they will be havens of sustainable development and food security.
    • The bamboo plantation program will boost self-employment in the region.
    • It will benefit a large number of women and unemployed youths in the region by connecting them to skill development programs.

    Answer this PYQ in the comment box:

    Q. Consider the following statements:

    1. As per recent amendment to the Indian Forest Act, 1927, forest dwellers have the right to fell the bamboos grown on forest areas.
    2. As per the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006, bamboo is a minor forest produce.
    3. The Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 allows ownership of minor forest produce to forest dwellers.

    Which of the statements given above is/are correct? (CSP 2019)

    (a) 1 and 2 only

    (b) 2 and 3 only

    (c) 3 only

    (d) 1, 2 and 3


    Back2Basics: Bamboo in India

    • Bamboos are tall treelike grasses.
    • With an amendment in 2017 in the Indian Forest Act 1927, the Bamboo has ceased to be a tree anymore.
    • Earlier, the definition of tree in the law included palm, bamboo, brushwood and cane.
    • The move aims to promote cultivation of bamboo in non-forest areas to achieve the “twin objectives” of increasing the income of farmers and also increasing the green cover of the country.
    • Bamboo grown in the forest areas would continue to be governed by the provisions of the Indian Forest Act.
  • FDI in Indian economy

    Failure to comply with international judicial rulings hurts India’s image as an investment destination

    The article highlights the lack of immediate compliance by the Indian government in awards involving foreign investors.

    Why honouring award is important

    • An important factor that propels investors to invest in foreign lands is that the host state will honour contracts and enforce awards even when it loses.
    • But when the host state refuses to do so, it shakes investors’ confidence in the host state’s credibility towards the rule of law, and escalates the regulatory risk enormously.
    • To an extent, this has been India’s story over the last few years
    • Last year, India lost two high-profile bilateral investment treaty (BIT) disputes to two leading global corporations — Vodafone and Cairn Energy — on retrospective taxation.
    •  India has challenged both the awards at the courts of the seat of arbitration.
    • As India drags its feet on the issue of compliance, it harms India’s reputation in dealing with foreign investors.

    Antrix-Devas agreement cancellation dispute

    • The other set of high-profile BIT disputes involve the cancellation of an agreement between Antrix, a commercial arm of the Indian Space Research Organisation, and Devas Multimedia.
    • This annulment led to three legal disputes — a commercial arbitration between Antrix and Devas Multimedia at the International Chambers of Commerce (ICC), and two BIT arbitrations brought by the Mauritius investors and German investors.
    • India lost all three disputes. 
    • The ICC arbitration tribunal ordered Antrix to pay $1.2 billion to Devas after a U.S. court confirmed the award earlier this year.
    • After the ICC award, Indian agencies started investigating Devas accusing it of corruption and fraud.
    • Last month, the National Company Law Tribunal (NCLT) ordered the liquidation of Devas on the ground that the affairs of the company were being carried on fraudulently.
    • This has led to Devas issuing a notice of intention to initiate a new BIT arbitration against India, sowing the seeds for complex legal battles again.

    Implications for investment in India

    • A closer reading of these cases reveals that whenever India loses a case to a foreign investor, immediate compliance rarely happens.
    • Instead, efforts are made to delay the compliance as much as possible.
    • While these efforts may be legal, it sends out a deleterious message to foreign investors.
    • It shows a recalcitrant attitude towards adverse judicial rulings.
    • This may not help India in attracting global corporations to its shores to ‘make for the world’.

    Consider the question “What are the factors that are leading to more Indian business disputes being settled elsewhere? What are the implications of delay by the government in honouring the awards of the disputes?” 

    Conclusion

    As India aspire to be the global destination of FDI, it needs to burnish its image on the dispute resolution front by honouring the awards.

  • Goods and Services Tax (GST)

    Four years of GST Regime

    The Prime Minister has lauded Goods and Services Taxes (GST) on its completion of 4 years and said it has been a milestone in the economic landscape of India.

    What is GST?

    • GST is an indirect tax that has replaced many indirect taxes in India such as excise duty, VAT, services tax, etc.
    • The Goods and Service Tax Act was passed in Parliament on 29th March 2017 and came into effect on 1st July 2017. It is a single domestic indirect tax law for the entire country.
    • It is a comprehensive, multi-stage, destination-based tax that is levied on every value addition.
    • Under the GST regime, the tax is levied at every point of sale. In the case of intra-state sales, Central GST and State GST are charged. All the inter-state sales are chargeable to the Integrated GST.

    Answer this PYQ in the comment box:

    Q.All revenues received by the Union. Government by way of taxes and other receipts for the conduct of Government business are credited to the (CSP 2015):

    (a) Contingency Fund of India

    (b) Public Account

    (c) Consolidated Fund of India

    (d) Deposits and Advances Fund

    What are the components of GST?

    There are three taxes applicable under this system:

    1. CGST: It is the tax collected by the Central Government on an intra-state sale (e.g., a transaction happening within Maharashtra)
    2. SGST: It is the tax collected by the state government on an intra-state sale (e.g., a transaction happening within Maharashtra)
    3. IGST: It is a tax collected by the Central Government for an inter-state sale (e.g., Maharashtra to Tamil Nadu)

    Advantages Of GST

    • GST has mainly removed the cascading effect on the sale of goods and services.
    • Removal of the cascading effect has impacted the cost of goods.
    • Since the GST regime eliminates the tax on tax, the cost of goods decreases.
    • Also, GST is mainly technologically driven.
    • All the activities like registration, return filing, application for refund and response to notice needs to be done online on the GST portal, which accelerates the processes.

    Issues with GST

    • High operational cost
    • GST has given rise to complexity for many business owners across the nation.
    • GST has received criticism for being called a ‘Disability Tax’ as it now taxes articles such as braille paper, wheelchairs, hearing aid etc.
    • Petrol is not under GST, which goes against the ideals of the unification of commodities.
  • Industrial Sector Updates – Industrial Policy, Ease of Doing Business, etc.

    Middle income trap

    The article suggests focusing on improving productivity and thereby the manufacturing sector to avoid the middle-income trap.

    What is the middle-income trap and why it matters for India

    • This trap was first conceived by World Bank economists.
    • They found that of the 101 developing economies that could be classified as ‘middle income’ in 1960, only 13 managed to become rich nations by 2008. 
    • There is little consensus on why some countries succeed in making the transition to high-income status.
    • But a distinctive attribute of those that succeed in the transition to high income is productivity improvement.
    • India could use its demographic dividend to avoid this predicament and achieve the critical velocity needed to move into the high-income bracket.

    How can India avoid the middle-income trap

    1) Improve productivity

    • Re-allocation of labour from low-productivity agriculture to high-productivity sectors, such as manufacturing, has been a primary channel through which today’s advanced economies raised their living standards.
    • In India, growth in labour productivity has consistently declined over the past decade.
    • The annual growth rate of output per worker has dipped from 7.9% in 2010 to 3.5% in 2019, as per International Labour Organization estimates.
    • This was also a period of low growth in India’s manufacturing sector.
    • In 2020-21, it accounted for only 14.5% of India’s gross value added, down from 17.4% in 2011-12.
    • An essential first step in improving productivity would be strengthening this sector.

    2) Strengthen manufacturing sector

    • Industrial labour relations is among the most critical elements to revitalize India’s manufacturing sector especially in the context of labour productivity.
    • These labour laws created incentives for firms to remain small and uncompetitive, thereby affecting productivity.
    • The new code, once implemented, would increase the threshold relating to layoffs and retrenchment in industrial establishments to 300 workers.
    • Other countries, such as China, Vietnam and Bangladesh, with whom India competes for foreign investment and export markets do not require the approval of administrative or judicial bodies for dismissals.
    • Therefore, in spite of recent reforms, India’s labour laws stay rigid in comparison with those of its competitor countries.

    3) Technology intensive manufacturing

    • Engendering innovation in higher value-added, tech-intensive activities is important for economies before they reach that juncture.
    • If exports are taken as a proxy for the manufacturing capabilities and competitiveness of an economy, the present status of tech-intensive manufacturing in India leaves a lot to be desired.
    • As per World Bank data, high-tech exports accounted for only 10.3% of India’s manufacturing exports in 2019.
    • Rival countries had a much higher share of the same: 31% in China, 13% in Brazil, 40% in Vietnam and 24% in Thailand.
    • Low R&D spending in India, ranging from a mere 0.64% to 0.86% of gross domestic product over the past two decades, has held the country back.

    Steps to improve tech-intensive manufacturing

    • The government has introduced a production-linked incentive scheme to ensure a greater share of local value addition.
    • While this would attract foreign investments in tech-intensive manufacturing, there is also a need for greater incentives for R&D investments by firms in India.
    • A first step in this direction could be reinstating the tax exemption on R&D under Section 35 (2AB), even for companies opting for the lower corporate tax rate of 22%.

    Conclusion

    We need appropriate interventions to improve productivity—both economy-wide and within the sector. And we must do it now.

  • Delhi Full Statehood Issue

    How the GNCTD (Amendment) Act affects functioning of Delhi Assembly

    The article highlights the implications of the Government of National Capital Territory of Delhi (GNCTD)(Amendment) Act, 2021 on functioning of Assembly and its committees.

    Context

    The Government of National Capital Territory of Delhi (GNCTD)(Amendment) Act, 2021 has been criticised as a retrograde law. However, what deserves equal attention is the Act’s assault on the functioning of Delhi’s Legislative Assembly.

    Background of GNCTD Act

    • The GNCTD Act was enacted in 1992.
    • Under the Act, Delhi Legislative Assembly was given the power to regulate its own procedure, as well as the conduct of its business.
    • This sought to realise a delicate balance reflecting Delhi’s unique constitutional position: neither full state nor a centrally governed Union Territory.

    How amendment affects functioning of Assembly

    • Its standards of procedure and conduct of business have been firmly tethered to that of the Lok Sabha, depriving Delhi’s elected MLAs of an effective say in how their Assembly should be run.
    • The Amending Act prohibits the Assembly from making any rule enabling either itself or its committees to consider any issue concerned with “the day-to-day administration of the capital” or “conduct inquiries in relation to administrative decisions”.
    • The most significant impact of this shall be on the exercise of free speech in the Assembly and its committees.
    • The amendment impeded the Assembly from performing its most basic legislative function — that of holding the executive to account by restricting its ability to freely discuss matters happening in the capital.

    Impact on committees

    • The deliberations and inputs of committees often pave the way for intelligent legislative action.
    • In a way, they act as the eyes and ears for the whole House, which has neither the time nor the expertise to scrutinise issues in depth.
    • It would be impossible for committees to perform this function without the power to conduct inquiries.
    • Pre-emptively injunct a committee from conducting an inquiry “in relation to the administrative decisions” (an extremely broad exception) completely negates the ability of committees to function effectively as the Assembly’s advisors and agents.
    • The quality of legislative work emanating from the Assembly is thus ultimately bound to suffer.

    Consider the question “What are the reasons for frequent disputes between Delhi government and the Lt. Governor? Would the Government of National Capital Territory of Delhi (GNCTD)(Amendment) Act, 2021 succeed in ending that trend?” 

    Conclusion

    The amendment deprive the Delhi Assmbly of its very basic functions and render it a ‘legislature’ in name only. Surely, Delhi’s voters deserve better than that. The Government need to reconsider the provisions of the amendment act.

  • Electric and Hybrid Cars – FAME, National Electric Mobility Mission, etc.

    Are solar electricity and electric vehicles really ‘clean’

    It Matters How the Electricity Is Made

    • Among the many drivers of global warming, electricity generation/consumption and transportation of people and goods have been identified as two important drivers which contribute almost 50% to the emissions load.
    • Against this backdrop, two non-food or agriculture technologies that have been projected and implemented as ‘clean alternatives’ to mitigate the global warming phenomenon are:
    1. Solar photovoltaics for electricity generation
    2. Electrification of transport

    Cleanliness of these alternatives

    • There is a general propensity to push these two alternatives in terms of energy and financial return on investments but very little is being said upfront about environmental cost and effect.
    • Both these technologies indeed lead to significantly reduced emissions after they are implemented.
    • The catchphrase here, however, is after!
    • There is little information or discussion in the public domain about upfront environmental cost as it is an inconvenient truth that cannot be wished away.

    Why aren’t they clean

    • Prior to their implementation, a lot of different human-made materials have to be synthesized from naturally occurring raw materials.
    • Then, these have to be put together as a functioning unit or a device for a specific purpose.
    • These processes, unfortunately, are both energy- and emissions-intensive and to realise the extent of these intensities, one needs to go behind the scene.

    Critical analysis

    [1] Solar energy

    • The dominant market player in the field of solar energy conversion to electricity is silicon-based modules occupying more than 90 per cent of the installed capacity.
    • These modules are made of elements as well as inorganic and organic compounds such as silicon, aluminum, copper, silver, glass, epoxy, plastics and are generally installed using steel and concrete.
    • All these materials are human-made and hence need to be synthesized utilizing naturally occurring raw materials.
    • These synthesis processes are energy- and water-consuming and emit greenhouse gasses and pollutants into the atmosphere — dark horses in the chain of realization of solar energy conversion to electricity.
    • Information regarding the environmental costs of these processes is not extensively mentioned in the public domain except for a few occasional studies.
    • These studies indicate that the CO2(e) gasses emission due to solar panel manufacturing alone is about 2,560 kg per kilowatt of installed capacity, which is quite significant.

    [2] Electrification of transportation

    • This involves the substitution of current petrol, diesel and gas combustion-powered engines in automobiles with electric engines.
    • The two main components of such an automobile, therefore, are: the engine which converts electrical energy to propulsion and a battery.
    • The electric engine or motor has been known for a long time but for the above application, it needs to have high energy density along with being compact and lightweight.
    • This can be accomplished by using what is known as ‘rare earth’ magnets which require extensive mining and processing which are environmentally intensive activities.
    • A closer look at the Li-ion battery shows that it requires a 40-kilowatt-hour battery and putting together such a battery results in releasing about 3,000 Kg of CO2(e) gasses into the

    The Indian scenario

    After looking at the behind-the-scenes emissions scenario of the two technologies, let us put Indian goals into perspective with respect to these two technologies.

    Solar energy

    • It was recently announced that India will have an installed capacity of 100 gigawatt (GW) for electricity generation by solar photovoltaics by the year 2022.
    • This will mean gaseous emissions to the tune of 0.256 GTons of CO2(e) for manufacturing of solar panels, which is a staggering amount from this activity alone.
    • It should be noted here that installation of 100 GW electrical power generation plants will actually result in only 25 GW of usable electricity at best, assuming an efficiency of 25 per cent, which itself is quite high.
    • If, on the other hand, we would like to have 100 GW of usable electrical power being generated by solar photovoltaics, it will result in emissions to the tune of 1.024 GTons of CO2(e), which is enormous.
    • This is an upfront loading of the environment with greenhouse gasses gases and excludes the embodied carbon in batteries, inverters, junction boxes, wiring and so on.

    Electric automobiles

    • The Union transportation minister has recently announced that India will become the largest manufacturer of electric vehicles and Li-ion batteries will be manufactured in India within the next six months.
    • To replace about a million conventional fuel-based vehicles (a fraction of the existing vehicles), it will result in upfront loading to the tune of 3 MTons of CO2(e) greenhouse gasses, just due to the battery assembly process alone.
    • The environmental costs due to electric motor manufacturing, mining of raw materials required for the battery and generation of electricity to run these million electric automobiles will be additional.
    • In both cases, the water requirement and particulate emissions have not been included, both of which are strongly linked to ecology and the environment.

    Conclusion

    • It is very clear from the two technologies and the related national goals that huge environmental, human, as well as economic costs, need to be paid upfront to realise these goals.
    • The task becomes even more daunting as the infrastructure required to make either solar grade Si or for that matter put together a million Li-ion batteries is non-existent at present.
    • In light of these facts, it becomes imperative to realign goals and prioritize steps to be taken to alleviate the problem of emissions and the associated global warming.

    Way forward

    • It is important to try various less harmful alternatives.
    • On another note, it is time to legislate so that businesses will also include the costs of atmospheric pollution together with their profit and loss statements.
  • Water Management – Institutional Reforms, Conservation Efforts, etc.

    Rooftop rainwater harvesting for India’s water stress

    India’s rapid urban growth is expected to stress its already crumbling base of public service arrangements — especially its management of water and sanitation services, whose safe and reliable availability proved to be the first line of defence against this covid pandemic.

    Q.Discuss how Rooftop rainwater harvesting can ease India’s water woes? (150W)

    Rooftop Rain Water Harvesting

    • It is the technique through which rainwater is captured from the roof catchments and stored in reservoirs.
    • Harvested rainwater can be stored in sub-surface groundwater reservoirs by adopting artificial recharge techniques to meet the household needs through storage in tanks.
    • Capturing and storing rainwater for use is particularly important in dryland, hilly, urban and coastal areas.
    • It holds the potential to support the country’s preparedness against the incipient challenges of changing climate.

    Water stress in India

    • An appalling confusion grips our policy makers and planners.
    • While the supply-demand gap is expected to widen by 50 per cent by 2030, many are still left without access to safe and sustainable water and sanitation services.
    • At least five Indian cities are already reported to have joined the list of world’s 20 largest water-stressed cities.

    If we look at the present portfolio of water resources management for other cities, it will not be wrong to claim that many more will soon become qualified for joining this infamous list.

    Exploring the complex problems

    • Water availability in India remains at the mercy of erratic patterns of precipitation.
    • Concretization of urban landscapes, symbolic of modern town planning imaginaries as to what an exercise in urban development has led to floods worsening.
    • Illegal encroachment along stormwater drains and urban rivers also aggravates the situation, not least by opening up spaces of active political contestation and negotiations.

    A paradigm shift needed

    • In India, management of water was bundled as part of the prerogative claims of post-independent public institutions with public participation programs designed later on to serve only a placatory function.
    • This has led to the systematic exclusion of the public’s opinions in informing the design and implementation protocols of large public schemes.
    • It took the form of multi-purpose dams, irrigation canals, public water distribution systems, etc.
    • Despite this, India has now become a ‘water-stressed country.

    A newer approach

    • Rising national empathy for river rejuvenation, watershed conservation and active public participation has, on the other hand, already started scripting a new paradigm for India’s water management.
    • It prompts decision-makers to look for solutions in the collective efforts of the citizens in managing their issues locally.

    Right from the vedic times

    • Our Vedic ancestors, in their appreciation of the timeless bounty of water, always offered timely obeisance to water’s eternal gifts to mankind.
    • Their reverence to water can be found in the hymns and prayers offered to Varuna and Indra — Vedic Gods associated with water to riveting architectural gems and literary delights, each underscoring the centrality of water in our cultural revelries.
    • It is time our policies are re-designed to reflect these values.

    Empowering people

    • Rooftop rainwater structures are perfectly poised to engender a transformative wave of public engagement in water management.
    • Thus it can act as a corollary for making water management an exercise in nurturing democratic routines.
    • To ensure that the public enthusiastically purchases this concept, a country-wide behaviour change campaign can be launched along the lines of the Swachh Bharat Mission.
    • This can emphasize people’s ‘ability and ‘motivation’ to romantically welcome these structures in their private premises.
    • This should rather be a ‘do-it-yourself’ model of engagement.
  • Climate Change Negotiations – UNFCCC, COP, Other Conventions and Protocols

    Lowering Emissions by Accelerating Forest Finance (LEAF) Coalition

    At the recently concluded Leaders’ Summit on Climate in April 2021, the Lowering Emissions by Accelerating Forest Finance (LEAF) Coalition was announced.

    LEAF Coalition

    • LEAF Coalition is a collective of the US, UK and Norway governments.
    • It is a public-private effort, thus supported by transnational corporations (TNCs) like Unilever plc, Amazon, Nestle, Airbnb etc.
    • It came up with a $1 billion fund plan that shall be offered to countries committed to arresting the decline of their tropical forests by 2030.
    • The LEAF coalition initiative is a step towards concretizing the aims and objectives of the Reducing Emissions from Deforestation and Forest Degradation (REDD+) mechanism.

    How does this coalition work?

    • The LEAF Coalition can help reverse the trend by providing unprecedented financial support to tropical forest governments implementing forest protection, contributing to green and resilient growth through sustainable investments.
    • It empowers tropical and subtropical forest countries to move more rapidly towards ending deforestation while supporting them in achieving their Nationally Determined Contributions (NDCs) under the Paris Agreement.
    • Reductions in emissions are made across entire countries or large states and provinces (“jurisdictions”) through programs that involve all key stakeholders, including Indigenous peoples and local communities.

    Why is it significant?

    • Financial impetus is crucial as it incentivizes developing countries to capture extensive deforestation and provide livelihood opportunities to forest-dependent populations.
    • The initiative comes at a crucial time when the tropics have lost close to 12.2 million hectares (mha) of tree cover year last year according to global estimates released by Global Forest Watch.
    • Most of these lost forests were located in the developing countries of Latin America, Africa and South Asia.
    • India’s estimated loss in 2020 stands at 20.8-kilo hectares due to forest fires

    What lies next?

    • Implementation of the LEAF Coalition will help pump in fresh rigour among developing countries like India, that are reluctant to recognize the contributions of their forest-dwelling populations in mitigating climate change.
    • With the deadline for proposal submission fast approaching, India needs to act swiftly on a revised strategy.
    • Although India has pledged to carry out its REDD+ commitments, it is impossible to do so without seeking knowledge from its forest-dwelling population.

    Answer this PYQ in the comment box:

    With reference to ‘Forest Carbon Partnership Facility’, which of the following statements is/ are correct?  (CSP 2013)

    1. It is a global partnership of governments, businesses, civil society and indigenous peoples.
    2. It provides financial aid to universities, individual scientists and institutions involved in scientific forestry research to develop eco-friendly and climate adaptation technologies for sustainable forest management.
    3. It assists the countries in their ‘REDD+ (Reducing Emissions from Deforestation and Forest Degradation+)’ efforts by providing them with financial and technical assistance.

    Select the correct answer using the code given below:

    (a) 1 only (b) 2 and 3 only (c) 1 and 3 only (d) 1, 2 and 3


    Back2Basics: REDD+

    • REDD+ is a mechanism developed by Parties to the United Nations Framework Convention on Climate Change (UNFCCC).
    • It creates a financial value for the carbon stored in forests by offering incentives for developing countries to reduce emissions from forested lands and invest in low-carbon paths to sustainable development.
    • Developing countries would receive results-based payments for results-based actions.
    • REDD+ goes beyond simply deforestation and forest degradation and includes the role of conservation, sustainable management of forests and enhancement of forest carbon stocks.
    • It aims to create incentives for communities so that they stop forest degrading practices.

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