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Food Procurement and Distribution – PDS & NFSA, Shanta Kumar Committee, FCI restructuring, Buffer stock, etc.

Annapurti: The grain ATM

Prelims OnlySchemes | Governance | Mains Paper 2: Government Scheme/Policies
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Annapurti

Mains level: Not Much

annapurti

Central Idea

  • The recent demonstration of the Automated Multi-Commodity Grain Dispensing Machine, Annapurti, during the ‘National Conference of Food Ministers of States/UTs,’ showcased an innovative solution developed by the World Food Programme (WFP) India.

What is Annapurti?

  • Annapurti, also known as the Grain ATM, offers a fast, clean, and precise method of providing subsidized grains to beneficiaries through the Public Distribution System.
  • Developed by WFP India, it is an automated multi-commodity dispensing solution that ensures efficient access to commodities like rice, wheat, and grains.
  • Beneficiaries can securely access their entitlements through Annapurti following biometric authentication.

Key Features

  • Annapurti offers 24×7 access to full entitlements, eliminating spillage, waste, and inaccurate weighing.
  • The machine can dispense one or two grain commodities, up to 50 kilograms, within five minutes, with a minimal error rate of 0.01 percent.

Advantages and Potential Applications

(1) Ensuring Food Security:

  • Annapurti has significant potential for food-based safety nets, ensuring beneficiaries receive their monthly subsidized grains promptly.
  • The machine’s precision and reliability prevent losses and ensure individuals receive their entitled portions.

(2) Emergency Food Grain Distribution:

  • During emergencies, such as natural disasters or humanitarian crises, Annapurti can facilitate efficient and timely distribution of food grains to affected populations.
  • Its automated system streamlines the process, reducing dependency on manual labor and minimizing errors.

(3) Market Access for Smallholder Farmers:

  • Annapurti can play a crucial role in expanding market access for smallholder farmers.
  • By offering a reliable and efficient distribution channel, farmers can sell their produce directly to Annapurti, ensuring fair prices and reducing intermediaries.

Sustainable and Modular Design

(1) Energy Efficiency:

  • Annapurti is designed to prioritize food security while ensuring efficient energy consumption.
  • With a consumption rate of only 0.6 Watt per hour, it offers an environmentally friendly solution.

(2) Modular Design:

  • Annapurti’s modular design allows for flexibility and scalability based on available space.
  • The storage unit and components can be easily assembled and customized to suit different requirements.

(3) Integration with Renewable Energy:

  • Annapurti can be integrated with solar panels, inverter batteries, and elevators for automatic refilling.
  • This integration enhances the sustainability of the system by reducing dependency on conventional energy sources.

 

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Judicial Appointments Conundrum Post-NJAC Verdict

SC Collegium proposes new CJs to 7 High Courts

Prelims Only | Polity | Mains Paper 2: Executive & Judiciary
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Collegium system, NJAC

Mains level: Not Much

collegium

Central Idea

  • The Supreme Court Collegium, led by Chief Justice of India D. Y. Chandrachud, has recommended new Chief Justices for seven major High Courts in India.
  • The recommendations focus on criteria such as seniority, regional representation, and gender diversity.

What is Collegium System?

  • The Collegium of judges is the Indian Supreme Court’s invention.
  • It does not figure in the Constitution, which says judges of the Supreme Court and High Courts are appointed by the President and speaks of a process of consultation.
  • In effect, it is a system under which judges are appointed by an institution comprising judges.
  • After some judges were superseded in the appointment of the CJI in the 1970s, and attempts made subsequently to effect a mass transfer of High Court judges across the country.
  • Hence there was a perception that the independence of the judiciary was under threat. This resulted in a series of cases over the years.

Evolution: The Judges Cases

  • First Judges Case (1981) ruled that the “consultation” with the CJI in the matter of appointments must be full and effective.
  • However, it rejected the idea that the CJI’s opinion, albeit carrying great weight, should have primacy.
  • Second Judges Case (1993) introduced the Collegium system, holding that “consultation” really meant “concurrence”.
  • It added that it was not the CJI’s individual opinion, but an institutional opinion formed in consultation with the two senior-most judges in the Supreme Court.
  • Third Judges Case (1998): On a Presidential Reference for its opinion, the Supreme Court, in the Third Judges Case (1998) expanded the Collegium to a five-member body, comprising the CJI and four of his senior-most colleagues.

Functions of the Collegium

(1) Appointment of CJI

  • The President of India appoints the CJI and other Supreme Court judges.
  • The outgoing CJI recommends his successor, and the appointment is typically made based on seniority, following the controversy of the 1970s.
  • The Union Law Minister forwards the recommendation to the Prime Minister, who then advises the President on the appointment.

(2) Appointment of Other SC Judges

  • The proposal for appointing other judges to the Supreme Court is initiated by the CJI.
  • The CJI consults other members of the Collegium, as well as the senior-most judge from the High Court to which the recommended person belongs.
  • The opinions of the consultees must be recorded in writing and included in the file.
  • The Collegium sends the recommendation to the Law Minister, who forwards it to the Prime Minister for the President’s advice.

(3) Appointment of High Court Judges

  • Chief Justices (CJs) of High Courts are appointed based on the policy of having Chief Justices from outside the respective states. The Collegium makes the final decision on their elevation.
  • The appointment of High Court judges is recommended by a Collegium consisting of the CJI and two senior-most judges.
  • The Chief Justice of the High Court concerned initiates the proposal in consultation with two senior-most colleagues.
  • The recommendation is then sent to the Chief Minister, who advises the Governor to forward the proposal to the Union Law Minister.

(4) Transfer Recommendations by the Collegium

  • The Collegium is also responsible for recommending transfers of Chief Justices and other judges.
  • Article 222 of the Constitution allows for the transfer of judges from one High Court to another.
  • When a Chief Justice is transferred, a replacement must be simultaneously appointed for the concerned High Court. An acting Chief Justice can be appointed for a maximum of one month.
  • In transfer matters, the CJI’s opinion is determinative, and the consent of the judge being transferred is not required.
  • However, the CJI should consider the views of the Chief Justice of the concerned High Court and one or more Supreme Court judges who are in a position to provide their opinions.
  • All transfers must be made in the public interest, aiming for the betterment of the administration of justice.

 

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Foreign Policy Watch: United Nations

What is High Seas Treaty?

IOCR | International Relations | Mains Paper 2: Bilateral, Regional and Global Groupings and agreements involving India
Note4Students

From UPSC perspective, the following things are important :

Prelims level: BBNJ/ High Seas Treaty

Mains level: Read the attached story

high seas treaty

Central Idea

  • The Marine Biodiversity of Areas Beyond National Jurisdiction (BBNJ) or the High Seas Treaty was adopted by the UN on June 19.
  • It became the third agreement under UNCLOS, following the establishment of the International Seabed Authority (ISB) and the Fish Stocks Agreement (FSA).

BBNJ/ High Seas Treaty

  • The idea of protecting the marine environment emerged in 2002, leading to the recognition of the need for an agreement in 2008.
  • In 2015, the UN General Assembly formed a Preparatory Committee to create the treaty.
  • Intergovernmental conferences (IGC) were held, resulting in the adoption of the treaty in 2023.
  • The treaty’s objective is to implement international regulations for the protection of marine life beyond national jurisdiction through international cooperation.

Key Provisions of Treaty

(1) Marine Protected Areas:

  • The treaty establishes marine protected areas to safeguard the oceans from human activities.
  • Decisions on protected areas require a “three-quarter majority vote” to prevent obstruction by a few parties.

(2) Sharing Benefits from Marine Genetic Resources:

  • The treaty mandates sharing scientific information and monetary benefits through a “clear house mechanism.”
  • The mechanism ensures open access to information on marine protected areas, marine genetic resources, and area-based management tools.

(3) Capacity Building and Marine Technology:

  • The treaty emphasizes capacity building and the use of marine technology for environmental impact assessment.
  • The Scientific and Technical Body will create standards and guidelines, assisting countries with limited capacity in carrying out assessments.

Challenges and Controversies

(1) Marine Genetic Resources:

  • The issue of sharing and exchanging information on marine genetic resources was a contentious point during negotiations.
  • Debates focused on monitoring information sharing and the potential hindrance to bioprospecting research.

(2) Definition and Language:

  • The use of phrases like “promote” or “ensure” in different parts of the treaty, particularly regarding benefit sharing, sparked heated debates.

(3) Adjacency Issue:

  • Negotiations were prolonged due to the need for provisions allowing coastal states to exercise sovereign rights over seabed and subsoil in areas beyond their jurisdiction.
  • The interests of landlocked and distant states further complicated decision-making.

Opposition to the Treaty

  • Several developed countries opposed the treaty due to their support for private entities involved in advanced research and development of marine technology.
  • Russia and China also expressed reservations, with Russia ultimately withdrawing during the final stage of consensus building, arguing that the treaty lacks a balance between conservation and sustainability.

Significance of the treaty

(1) Environmental Preservation:

  • The High Seas Treaty is crucial for protecting marine biodiversity and addressing pressing issues such as overfishing and pollution.
  • It represents a significant step towards international cooperation in preserving the health and sustainability of our oceans.

(2) Global Cooperation and Research:

  • The treaty promotes the sharing of scientific information and encourages collaboration among countries.
  • This will foster research initiatives and facilitate a better understanding of marine ecosystems, leading to more effective conservation measures.

Conclusion

  • The adoption of the High Seas Treaty marks a significant milestone in international efforts to protect marine biodiversity beyond national jurisdictions.
  • While challenges and controversies prolonged the negotiation process, the treaty sets the stage for enhanced global cooperation and the implementation of regulations to safeguard our oceans for future generations.

Back2Basics:

International Seabed Authority (ISA) Fish Stocks Agreement (FSA)
Purpose Regulate and manage activities in the international seabed and ocean floor beyond national jurisdiction Ensure the conservation and management of straddling fish stocks and highly migratory fish stocks
Legal Framework Established by the United Nations Convention on the Law of the Sea (UNCLOS) International treaty adopted by the United Nations
Established Date 1994 1995
Resource Focus Non-living resources (seabed minerals) and living resources (deep-sea ecosystems) Fish stocks (shared resources occurring in EEZs and beyond national jurisdiction)
Cooperation Emphasizes cooperation among states and establishment of Regional Fisheries Management Organizations (RFMOs) Promotes cooperation among states for sustainable fisheries management
Conservation Manages resources for the benefit of humankind as a whole, adhering to the common heritage of mankind principle Aims to conserve and sustainably manage fish stocks for present and future generations
Licensing Issues licenses and contracts for seabed mineral exploration and exploitation N/A (Focuses on the management and conservation of fish stocks)
Data Collection Promotes scientific research and international cooperation in the deep seabed area Encourages data collection, reporting, and scientific assessment of fish stocks
Dispute Settlement Provides mechanisms for dispute settlement and peaceful resolution of conflicts Includes provisions for dispute settlement and peaceful resolution of conflicts
Membership Consists of member states and the European Union Open to states committed to sustainable fisheries management
Headquarters Located in Kingston, Jamaica N/A (Operates under the United Nations framework)

 

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Panchayati Raj Institutions: Issues and Challenges

Supreme Court asks NGO to move govt against Sarpanch-Patism

| Polity | Mains Paper 2: Indian Constitution - historical underpinnings, evolution, features, amendments, significant provisions and basic structure
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Read the attached story

Mains level: Proxy politicians

sarpanch

Central Idea

  • The Supreme Court of India has stated that the government, rather than the judiciary, should address the issue of men exerting power behind elected women who remain “faceless wives and daughters-in-law” in grassroots politics.
  • The court’s remarks came in response to a petition filed by an NGO which highlighted the phenomenon of unelected male relatives wielding political influence, undermining the spirit of women’s reservation in Panchayati Raj Institutions (PRIs).

Women in PRIs: Legal Aspects

(a) 73rd Constitutional Amendment Act, 1992:

  • Mandates 33.3% reservation for women in PRIs across the country.
  • Recognizes the Gram Sabha as the foundation of the Panchayat Raj System, empowering it to perform functions and exercise powers entrusted by the State Legislatures.
  • Some states have increased the reservation to 50%, including Andhra Pradesh, Chhattisgarh, Gujarat, Himachal Pradesh, Bihar, etc.
  • Out of the 30.41 lakh elected representatives in PRIs, 13.74 lakh (45.2%) are women.

(b) Article 15(3) of the Constitution:

  • Empowers the State to make special provisions for women.
  • Allows the government to introduce measures to ensure gender equality and promote the interests of women.

(c) Article 243D:

  • Provides for the reservation of one-third of the total number of seats and offices of Chairpersons in PRIs for women.
  • The reserved seats and offices are allocated through rotation to different constituencies within a Panchayat.
  • These reservations for women are in addition to the reservations for Scheduled Castes (SCs) and Scheduled Tribes (STs) in all three tiers of PRIs.

(d) Intersectional Reservations:

  • The reservation of seats and offices for women in PRIs also falls within the overall reservations for Scheduled Castes (SCs) and Scheduled Tribes (STs) in all three tiers of PRIs.
  • This provision aims to address the intersecting disadvantages faced by women from marginalized communities.

(e) Proposed 110th Constitution Amendment Bill:

  • Introduced in the Lok Sabha in 2009 to bring about 50% reservation for women in Panchayats across all states.
  • The bill aimed to increase the reservation beyond the existing 33.3% mandated by the 73rd Amendment Act.
  • Despite multiple tabled attempts, the bill was not passed into law.

Proxy Sarpanchs in India

  • It is generally observed where an elected lady Sarpanch (the head of a Panchayat) delegates their powers and responsibilities to someone else, typically a family member or a trusted individual.
  • This proxy then acts as a representative or substitute for the Sarpanch in carrying out their duties.
  • Quite often, this delegation is forcefully acquired from women.

Reasons behind Panchayat Pati syndrome

  • Gender Inequality: Deep-rooted gender inequalities prevalent in Indian society play a significant role in perpetuating the Panchayat Pati syndrome. Patriarchal norms and cultural beliefs that prioritize male authority and decision-making often restrict women’s agency and participation in public affairs.
  • Social Norms and Expectations: Traditional gender roles and societal expectations define women’s primary role as homemakers and caretakers. This perception often results in women being considered unfit or inexperienced in matters of governance
  • Lack of Awareness and Education: Limited access to education and awareness about women’s rights and the importance of their participation in local governance can contribute to the prevalence of Panchayat Pati. Lack of awareness among women themselves, as well as their families and communities, can lead to the perpetuation of discriminatory practices.
  • Male Domination and Resistance to Change: Male dominance in politics and resistance to gender equality can also contribute to the Panchayat Pati syndrome.
  • Political Dynamics and Power Struggles: In some cases, male family members or influential community leaders may strategically use the Panchayat Pati practice to retain power and influence. By controlling women’s decision-making, they can ensure their interests are protected and continue to exert control over the local governance processes.

Impact of Panchayat Pati syndrome

      1. Economic Impact:

  • The practice of Panchayat Pati limits the active participation of women in decision-making processes within the panchayat.
  • This exclusion can hinder the effective utilization of resources and allocation of funds, potentially leading to suboptimal economic outcomes for the community.
  • Women’s perspectives and needs may not be adequately represented, and projects or initiatives that could benefit women, such as those related to education, healthcare, or livelihood opportunities, may not receive sufficient attention or support.

      2. Social Impact:

  • Panchayat Pati reinforces gender inequalities and perpetuates traditional gender roles within communities.
  • It hampers women’s ability to exercise agency and engage in community development activities. it diminishes their self-esteem and status within the community.

     3. Political Impact:

  • The practice of Panchayat Pati undermines the principles of democratic representation and participatory governance.
  • It restricts the political agency of women and denies them the opportunity to actively contribute to decision-making processes.
  • Women’s perspectives and priorities often differ from those of men, and their exclusion diminishes the diversity of voices and perspectives in local governance. This can lead to policy decisions that may not adequately address the needs and concerns of women and other marginalized groups.

Court’s Response

  • Not an Executive Authority: The court acknowledged the issue but emphasized that it is not the role of the judiciary to create a spirit of empowerment.
  • Focus on women empowerment: The court pointed out that preventing influential individuals’ wives from contesting elections is not feasible, and empowering women requires an evolutionary process.
  • Government’s Responsibility: The court highlighted that the Ministry of Panchayati Raj should address the petitioner’s grievance and explore better mechanisms to implement the objectives of women’s reservation.
  • Expert Committee and Support Mechanism: The petitioner suggested the formation of an expert committee and the provision of the right support mechanism for women. However, the court deemed this an unrealistic expectation from the judiciary.

Way forward

  • Engage Men as Allies: Promote male allies in supporting women’s representation in PRIs. Encourage men to actively advocate for gender equality, challenge patriarchal norms, and work towards creating a more inclusive and equitable political environment.
  • Capacity Building and Leadership Development: Provide training and capacity-building programs for women elected representatives in PRIs.
  • Political Awareness and Participation: Conduct awareness campaigns to educate women about their rights, the importance of political participation, and the impact of their involvement in PRIs.
  • Inter-Gender Dialogues: Organize inter-generational dialogues where older leaders and women can exchange knowledge, experiences, and perspectives. This can help bridge the generation gap, promote inter-generational collaboration, and strengthen the collective power of women in PRIs.

Conclusion

  • It is the responsibility of the executive authority to find suitable solutions and ensure the effective implementation of women’s reservations in panchayat governance.

Mains Mark enhancer: Successful Women Sarpanch in India

  • Kali Bein Panchayat, Punjab: Kali Bein Panchayat in Punjab gained recognition for its all-women panchayat led by Sarpanch Bibi Jagir Kaur. Under her leadership, the panchayat focused on various development initiatives, including infrastructure development, water conservation, and women empowerment programs.
  • Mawlynnong, Meghalaya: Mawlynnong, a village in Meghalaya, is known for its clean and well-maintained environment. The village achieved this feat under the leadership of women panchayat leaders who implemented strict cleanliness and waste management measures, making it one of the cleanest villages in Asia.
  • Devdungri, Rajasthan: Devdungri village in Rajasthan is an exemplary case of women’s leadership in panchayats. Women panchayat members successfully implemented initiatives to address issues such as child marriage, female foeticide, and women’s education. Their efforts resulted in significant positive changes in the community.

 

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FDI in Indian economy

FinMin pushes for reforms to spur FDI inflows

| Economics | Mains Paper 3: Investment Models
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Foreign Direct Investment (FDI)

Mains level: Read the attached story

fdi

Central Idea

  • The Finance Ministry of India emphasized the need to address challenges faced by global investors to facilitate Foreign Direct Investment (FDI) flows.
  • In this article, we delve into the factors affecting FDI inflows and propose measures to attract and sustain FDI in India.

What is Foreign Direct Investment (FDI)?

  • FDI refers to the investment made by individuals, companies, or governments from one country into business interests located in another country.
  • It involves the direct ownership or control of assets in the foreign country, typically in the form of establishing new ventures, acquiring existing businesses, or creating strategic partnerships.

Understanding FDI

Imagine you have a successful toy manufacturing company based in Country A. You have been experiencing steady growth and want to expand your business operations to a new market in Country B. However, entering a foreign market can be challenging due to unfamiliarity with the local business environment, regulations, and market dynamics.

To overcome these challenges, you decide to make a Foreign Direct Investment (FDI) in Country B. Instead of exporting toys from Country A to Country B, you establish a new manufacturing plant or acquire an existing toy company in Country B. By doing so, you gain direct ownership and control over the assets and operations in Country B.

 

India’s FDI feats

  • In terms of investor countries of FDI Equity inflow, Singapore is at the top with 27%, followed by the US with 18% and Mauritius with 16% for the FY 2021-22.
  • ‘Computer Software & Hardware’ has emerged as the top recipient sector of FDI Equity inflow during this period with around 25% share followed by Services Sector and Automobile Industry with 12% each.
  • With 53 % Karnataka has received the majority share of FDI equity in the `Computer Software & Hardware’ sector.

FDI in India

  • Foreign investment was introduced in 1991 under Foreign Exchange Management Act (FEMA), driven by then FM Manmohan Singh.
  • Economic liberalisation started in India in the wake of the 1991 crisis and since then, FDI has steadily increased in the country.
  • India, today is a part of top 100-club on Ease of Doing Business (EoDB) and globally ranks number 1 in the Greenfield FDI ranking.

There are two routes by which India gets FDI.

1) Automatic route: By this route, FDI is allowed without prior approval by Government or RBI.

2) Government route: Prior approval by the government is needed via this route. The application needs to be made through Foreign Investment Facilitation Portal, which will facilitate the single-window clearance of FDI application under Approval Route.

  • India imposes a cap on equity holding by foreign investors in various sectors, current FDI in aviation and insurance sectors is limited to a maximum of 49%.
  • In 2015 India overtook China and the US as the top destination for the Foreign Direct Investment.

Sectors that come under the ‘100% Automatic Route’ category are

  • Agriculture & Animal Husbandry, Air-Transport Services (non-scheduled and other services under civil aviation sector)
  • Airports (Greenfield + Brownfield),
  • Asset Reconstruction Companies,
  • Auto-components, Automobiles,
  • Biotechnology (Greenfield),
  • Broadcast Content Services (Up-linking & down-linking of TV channels, Broadcasting Carriage Services,
  • Capital Goods, Cash & Carry Wholesale Trading (including sourcing from MSEs), Chemicals, Coal & Lignite, Construction Development,
  • Construction of Hospitals,
  • E-commerce Activities, Electronic Systems,
  • Food Processing, Gems & Jewellery, Healthcare, Industrial Parks, IT & BPM, Leather, Manufacturing, Mining & Exploration of metals & non-metal ores, Other Financial Services,
  • Pharmaceuticals, Plantation sector
  • Ports & Shipping, Railway Infrastructure, Renewable Energy, Roads & Highways,
  • Single Brand Retail Trading, Textiles & Garments,
  • Thermal Power,
  • Tourism & Hospitality and
  • White Label ATM Operations.

Sectors that come under up to 100% Automatic Route’ category are–

  • Infrastructure Company in the Securities Market: 49%
  • Insurance: up to 49%
  • Medical Devices: up to 100%
  • Pension: 49%
  • Petroleum Refining (By PSUs): 49%
  • Power Exchanges: 49%

Sectors that come under the ‘up to 100% Government Route’ category are–

  • Banking & Public sector: 20%
  • Broadcasting Content Services: 49%
  • Core Investment Company: 100%
  • Food Products Retail Trading: 100%
  • Mining & Minerals separations of titanium bearing minerals and ores: 100%
  • Multi-Brand Retail Trading: 51%
  • Print Media (publications/ printing of scientific and technical magazines/ specialty journals/ periodicals and facsimile edition of foreign newspapers): 100%
  • Print Media (publishing of newspaper, periodicals and Indian editions of foreign magazines dealing with news & current affairs): 26%
  • Satellite (Establishment and operations): 100%

Prohibited Sectors

There are a few industries where FDI is strictly prohibited under any route. These industries are

  • Atomic Energy Generation
  • Any Gambling or Betting businesses
  • Lotteries (online, private, government, etc.)
  • Investment in Chit Funds
  • Nidhi Company
  • Agricultural or Plantation Activities (although there are many exceptions like horticulture, fisheries, tea plantations, Pisciculture, animal husbandry, etc.)
  • Housing and Real Estate (except townships, commercial projects, etc.)
  • Trading in TDR’s
  • Cigars, Cigarettes, or any related tobacco industry

Benefits offered by FDI

  • Employment generation: FDI boosts the manufacturing and services sector which results in the creation of jobs and helps to reduce unemployment rates in the country.
  • Economic growth: Increased employment translates to higher incomes and equips the population with more buying powers, boosting the overall economy of a country.
  • Human capital development: Skills that employees gain through training and experience can boost the education and human capital of a specific country. Through a ripple effect, it can train human resources in other sectors and companies.
  • Technology boost: The introduction of newer and enhanced technologies results in company’s distribution into the local economy, resulting in enhanced efficiency and effectiveness of the industry.
  • Increase in exports: Many goods produced by FDI have global markets, not solely domestic consumption. The creation of 100% export oriented units help to assist FDI investors in boosting exports from other countries.
  • Exchange rate stability: The flow of FDI into a country translates into a continuous flow of foreign exchange, helping a country’s Central Bank maintain a prosperous reserve of foreign exchange which results in stable exchange rates.
  • Improved Capital Flow: Inflow of capital is particularly beneficial for countries with limited domestic resources, as well as for nations with restricted opportunities to raise funds in global capital markets.
  • Creation of a Competitive Market: By facilitating the entry of foreign organizations into the domestic marketplace, FDI helps create a competitive environment, as well as break domestic monopolies.
  • Climate mitigation: The United Nations has also promoted the use of FDI around the globe to help combat climate change

Factors Affecting recent FDI inflows

(1) Inflationary Pressures and Tighter Monetary Policies

  • The dip in FDI inflows in 2022-23 can be attributed to inflationary pressures and tighter monetary policies.
  • Policymakers should address these factors to encourage a favorable investment climate.

(2) Geopolitics vs. Geography

  • The Ministry highlights the influence of “political distance more than geographical distance” on FDI flows.
  • Geopolitical factors have dominated over traditional geographical considerations.

(3) Global FDI Trends

  • Gross FDI flows declined by 16% in 2022, compared to the record high of $84.8 billion in 2021-22.
  • Net inflows experienced a sharper decline of 27.4%.
  • Similar trends were observed in emerging market economies, where net FDI inflows declined by 36% in 2022.

Challenges for India’s Growth Outlook

(1) External Sector Challenges:

  • The review identifies the external sector as a potential challenge for India’s growth in 2023-24.
  • Factors such as geopolitical stress, volatility in global financial systems, price corrections in global stock markets, El-Nino impact, and weak global demand could constrain growth.
  • Policymakers must closely monitor FDI data and undertake measures to facilitate FDI inflows.

(2) Fragmentation of FDI Flows:

  • The Ministry highlights the phenomenon of “friend shoring,” wherein FDI is directed towards geopolitically aligned countries.
  • This has led to a fragmentation of FDI flows globally, as per research from the International Monetary Fund (IMF).
  • Additionally, inflows from foreign portfolio investors (FPIs) into Indian markets have become less volatile.

Conclusion

  • To attract and sustain FDI inflows, India needs to address challenges related to inflation, monetary policies, geopolitical factors, and last-mile infrastructure.
  • Additionally, mitigating trade risks and fostering inclusive growth through job creation will contribute to a favorable investment climate.

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Poverty Eradication – Definition, Debates, etc.

Issues with our national surveys

op-ed snap | Governance | Mains Paper 3: issues relating to planning, mobilization of resources
Note4Students

From UPSC perspective, the following things are important :

Prelims level: India's major surveys and its findings

Mains level: Issues in India's major surveys, faulty sampling and its consequences for policy making

Central Idea

  • In India, the accuracy and reliability of data related to poverty, growth, employment, and unemployment are crucial for effective policy formulation. To ensure the well-being of its vast population, it is essential that surveys generating these estimates are conducted regularly, adhering to predetermined schedules, and maintain the highest standards of quality.

*Relevance of the topic*

There is significant gap in the data quality of India’s major surveys such as NSS, NFHS, and PLFS

For Instance, Major surveys conducted post-2011, which utilized the Census 2011 as the sampling frame, have consistently overestimated the proportion of the rural population.

There is need for a comprehensive sampling overhaul to accurately reflect India’s real economy.

The Significance of Sample Surveys

  • Data for Policy Formulation: Sample surveys, such as the NSS, NFHS, and PLFS, are vital sources of data that policymakers rely on to evaluate the effectiveness of past policies and design new ones.
  • Identifying Socio-Economic Indicators: Sample surveys provide estimates related to household consumption expenditure, health outcomes, education, employment status, asset ownership, poverty levels, and more. These indicators help policymakers identify areas that require attention and allocate resources accordingly.
  • Representative Data: Sample surveys through carefully selected samples, they aim to capture the diversity and heterogeneity of different regions, communities, and socio-economic groups.
  • Monitoring Progress and Development: By conducting surveys at regular intervals, sample surveys facilitate the monitoring of progress and development over time. It helps to identify areas where progress is lagging or where interventions are needed.
  • Evidence-based Decision-making: Sample surveys provide policymakers with empirical evidence that supports evidence-based decision-making. Instead of relying solely on anecdotal evidence or assumptions, policymakers can access reliable data to understand the impact of policies and make informed choices that are backed by robust statistical analysis.
  • Transparency and Accountability: Sample surveys promote transparency and accountability in policy-making. The availability of detailed survey methodologies and data allows for scrutiny and peer review, ensuring that the processes and findings are subject to rigorous analysis.

Issues in India’s major surveys

  • Outdated Sampling Frames: The surveys utilize outdated sampling frames, which means they do not accurately reflect the current population distribution in India. As a result, the surveys may underestimate the proportion of the urban population and overestimate the rural population, leading to biased estimates.
  • Inadequate Representation: The surveys’ sampling mechanisms are not adapted to rapid changes in India’s population and economy.
  • Data Quality: While there is a general consensus on the robustness and representativeness of the survey methodology, there is a lack of attention and scrutiny regarding the data quality of these surveys.
  • Non-Sampling Errors: The response rate in these surveys is not consistent across different wealth levels. This issue can introduce biases in the survey estimates, particularly with regards to the representation of wealthier households.
  • Underestimation of India’s Progress: In a dynamic economy like India, where there have been significant policy reforms and rapid urbanization, relying on outdated surveys can impede effective policy-making by creating a gap between ground realities and survey estimates.

Consequences of faulty sampling

  • Biased Estimates: Faulty sampling can introduce biases into survey estimates, leading to inaccurate representations of the target population. Biases can result in misleading findings and hinder effective policy decision-making.
  • Underrepresentation and Exclusion: Faulty sampling may lead to underrepresentation or exclusion of specific population groups. This can result in neglecting their needs and perspectives, leading to inadequate policy interventions for those marginalized or underrepresented groups.
  • Lack of Generalizability: Inaccurate or non-representative sampling hampers the generalizability of survey results. When the sample does not accurately reflect the population, it becomes challenging to make valid inferences about the broader population based on the survey findings.
  • Compromised Data Quality: Faulty sampling undermines the overall quality of the collected data. Sampling errors introduce uncertainty and reduce the precision of estimates, impacting the reliability and trustworthiness of the data.
  • Misguided Resource Allocation: Biased estimates resulting from faulty sampling can lead to misallocation of resources. If policy decisions are based on inaccurate information, resources may be allocated inefficiently, missing opportunities to address the actual needs of the population.
  • Erosion of Confidence: Faulty sampling erodes confidence in the survey process and the credibility of the data collected. Stakeholders may question the reliability and integrity of the surveys, leading to decreased trust and potentially hindering the utilization of the data for decision-making.

Way forward: Need for Reforms in Major surveys

  • Updating Sampling Frames: There is a need for a major sampling overhaul to address outdated sampling frames. Reforms should focus on ensuring that the sampling frames used in surveys like the NSS, NFHS, and PLFS accurately reflect the current population distribution in India.
  • Improved Survey Mechanisms: There is a necessity of adapting survey mechanisms to rapid changes in the population and economy. Reforms should be aimed at modernizing and streamlining the survey methodologies to better capture the true status of India’s real economy.
  • Addressing Data Quality Concerns: There is a lack of attention and scrutiny regarding the data quality of the major surveys. Reforms should prioritize enhancing data quality assurance measures throughout the survey process, including data collection, processing, and analysis.
  • Mitigating Non-Sampling Errors: Non-sampling errors, particularly related to low response rates correlated with wealth levels, need to be addressed. Reforms should focus on understanding and correcting for these errors to ensure more accurate and representative survey estimates.
  • Accurate Population Projections: Given the rapid pace of change, reforms should aim to improve population projections to align with ground realities. This would involve refining projections based on past trends and incorporating the current pace of urbanization and other demographic shifts.

Conclusion

  • To ensure effective policy-making and accurate assessments of India’s socioeconomic landscape, it is imperative to address the existing data quality gap. By prioritizing data quality alongside data availability and size, India can better inform policies and bridge the gap between statistical estimates and ground realities, facilitating holistic and inclusive development.

Also read:

Poverty Estimates: Issues With PLFS Data

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FDI in Indian economy

Internationalising the rupee without the ‘coin tossing’

op-ed snap | Economics | Mains Paper 3: Indian Economy
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Currency swap agreements, Rupee Internationalization and its direct and indirect impact on economy

Mains level: Rupee Internationalization, its significance of Indian economy, challenges and learnings from China and reforms

Central Idea

  • The recent announcement by the Indian government regarding a long-term road map for the internationalization of the rupee holds immense potential for the country’s economic growth. This move aims to revive the rupee’s historical prominence as a widely accepted currency in the Gulf region and strengthen its position in the global foreign exchange market.

*Relevance of the topic*

The Indian government has been consistently focused on promoting the internationalization of the rupee.

India has been exploring the use of the rupee for bilateral trade settlements with its trading partners, for instance amidst Russian oil ban, India explored Rupee-Rubel settlement for oil imports.

China, Russia and a few other countries have become more vocal in questioning the US dollar-dominated global currency system

Historical Context

  • Indian Rupee as Legal Tender in the Gulf Region: In the 1950s, the Indian rupee held the status of legal tender in several Gulf countries, including the United Arab Emirates, Kuwait, Bahrain, Oman, and Qatar. It was widely used for various transactions, and these Gulf monarchies purchased rupees using the pound sterling.
  • Introduction of the Gulf Rupee: To tackle challenges related to gold smuggling, the Reserve Bank of India (Amendment) Act was enacted in 1959. This legislation led to the creation of the Gulf Rupee, which was intended for circulation only in the West Asian region. The central bank issued notes specific to the Gulf region, and individuals holding Indian currency were given a six-week window to exchange their rupees for the new Gulf rupee.
  • Devaluation of Indian Rupee and Transition to Local Currencies: In 1966, India devalued its currency, which eventually had repercussions on the acceptance of the Gulf rupee. The devaluation eroded confidence in the stability of the Indian rupee, prompting some West Asian countries to replace the Gulf rupee with their own sovereign currencies. The introduction of sovereign currencies in the region was driven by both economic factors and concerns about the Indian rupee’s stability.
  • Impact of Demonetisation: In 2016, the Indian government implemented a demonetisation exercise, which involved invalidating high-value currency notes, including the ₹1,000 and ₹500 denominations. This move aimed to curb black money, corruption, and counterfeit currency. However, it also had an impact on the confidence in the Indian rupee, both domestically and among neighboring countries such as Bhutan and Nepal.
  • Withdrawal of ₹2,000 Note: In recent times, the decision to withdraw the ₹2,000 note from circulation has further affected confidence in the rupee. This move has led to concerns and uncertainties among the public and businesses, particularly regarding the stability and continuity of currency denominations.

What does it mean by Internationalizing the Indian Rupee?

  • Internationalizing the Indian Rupee refers to the process of increasing the acceptance, use, and recognition of the Indian rupee as a global currency. It involves making the rupee more widely used and traded in international markets, increasing its convertibility, and promoting its adoption for cross-border transactions, trade settlements, and investment activities

Advantages of internationalization of the rupee

  • Enhanced Trade and Investment: Internationalization of the rupee can facilitate smoother trade transactions between India and other countries. This can lead to increased bilateral trade, attract foreign investment, and boost economic growth.
  • Reduced Exchange Rate Risks: Internationalisation reduces exchange rate risks associated with fluctuations in major global currencies. When the rupee becomes more widely accepted and used in international transactions, it reduces the vulnerability of the Indian economy to external currency volatility.
  • Lower Transaction Costs: Greater international acceptance of the rupee can reduce transaction costs for businesses and individuals engaged in cross-border trade and remittances.
  • Strengthening Financial Markets: A more internationalized rupee would lead to the development of deeper and more liquid rupee-denominated financial markets. This includes rupee bond markets and derivatives markets. It helps diversify funding sources and provide greater stability and opportunities for investors and businesses.
  • Reserve Currency Status: The internationalisation of the rupee can potentially lead to its recognition as a reserve currency. Reserve currency status enhances a country’s monetary and financial influence globally and promotes stability in international financial systems.
  • Boosting India’s Global Standing: Internationalisation of the rupee signals the country’s economic strength, reforms, and openness to international trade and investment. It can improve India’s reputation as an attractive investment destination and strengthen its role in regional and global economic decision-making forums.

The Challenge of International Demand for the rupee

  • Low Daily Average Share: The daily average share of the rupee in the global foreign exchange market is approximately 1.6%. This indicates that the rupee is not extensively traded or widely used for international transactions compared to currencies like the US dollar or the euro.
  • Limited International Transactions: Although India has taken steps to promote the internationalisation of the rupee, such as enabling external commercial borrowings in rupees and encouraging trade in rupees with select countries, the volume of such transactions is still limited. For instance, India continues to purchase oil from Russia in dollars, and efforts to settle trade in rupees with Russia have faced challenges.
  • Capital Account Convertibility Constraints: India imposes significant constraints on capital account convertibility, which refers to the movement of local financial investments into foreign assets and vice versa. These restrictions are in place to mitigate risks of capital flight and exchange rate volatility, given India’s current and capital account deficits. However, they limit the ease of converting rupees into other currencies, reducing international demand.
  • Lack of Reserve Currency Status: For a currency to be considered a reserve currency, it needs to be fully convertible, readily usable, and available in sufficient quantities. The rupee does not currently enjoy reserve currency status, and its limited convertibility and usage hinder its attractiveness for central banks and international institutions to hold significant amounts of rupees as part of their foreign exchange reserves.

Learning from China’s Experience

  • Phased Approach: China adopted a phased approach to internationalise the Renminbi (RMB). It initially allowed the use of RMB outside China for current account transactions, such as commercial trade and interest payments, and gradually expanded it to select investment transactions. This gradual approach helped in managing risks and ensuring a smooth transition.
  • Offshore Markets and Clearing Banks: China established offshore markets, such as the “Dim Sum” bond and offshore RMB bond market, which allowed financial institutions in Hong Kong to issue RMB-denominated bonds. Additionally, China permitted central banks, offshore clearing banks, and offshore participating banks to invest excess RMB in debt securities. These measures enhanced the RMB’s liquidity and facilitated its usage in international transactions.
  • Currency Swap Agreements: China entered into currency swap agreements with several countries, including Brazil, the United Kingdom, Uzbekistan, and Thailand. These agreements enabled the exchange of equivalent amounts of money in different currencies, facilitating trade and investment transactions in RMB and reducing reliance on other currencies.
  • Free Trade Zones: China launched the Shanghai Free Trade Zone, which facilitated free trading between non-resident onshore and offshore accounts. This zone provided a platform for international businesses to transact in RMB and boosted the currency’s international usage.
  • Reserve Currency Status: China’s efforts towards internationalisation of the RMB led to its recognition as a reserve currency. By the second quarter of 2022, the RMB’s share of international reserves reached approximately 2.88%. This status further solidified the RMB’s acceptance and usage in global financial markets.

Way forward: Reforms for Rupee Internationalisation

  • Full Convertibility: The rupee should be made more freely convertible, with a goal of achieving full convertibility by 2060. This would involve allowing financial investments to move freely between India and abroad, removing significant restrictions on currency exchange and capital flows.
  • Deeper and More Liquid Rupee Bond Market: The Reserve Bank of India (RBI) should focus on developing a deeper and more liquid rupee bond market. This would enable foreign investors and Indian trade partners to have more investment options in rupees, enhancing the attractiveness and usage of the currency.
  • Trade Settlement in Rupees: Indian exporters and importers should be encouraged to invoice their transactions in rupees. Optimising the trade settlement formalities for rupee import/export transactions would facilitate greater usage of the rupee in international trade, reducing reliance on foreign currencies.
  • Currency Swap Agreements: India can establish additional currency swap agreements with trading partners. These agreements would allow India to settle trade and investment transactions in rupees, eliminating the need for reliance on reserve currencies like the US dollar.
  • Tax Incentives for Foreign Businesses: The government can provide tax incentives to foreign businesses operating in India, encouraging them to utilize the rupee in their operations. This would boost the demand for the rupee and promote its usage in international transactions.
  • Currency Management Stability: The RBI and the Ministry of Finance should ensure consistent and predictable issuance and retrieval of notes and coins, promoting currency management stability. This stability is crucial for building confidence in the rupee’s value and maintaining trust among market participants.
  • Exchange Rate Regime Improvement: Improving the exchange rate regime by adopting transparent and market-based mechanisms can enhance the stability and credibility of the rupee’s exchange rate. This would instill confidence among investors and businesses dealing in rupee-denominated transactions.
  • Higher Profile in International Organizations: Efforts should be made to push for making the rupee an official currency in international organizations. This would raise the profile and acceptability of the rupee globally, contributing to its internationalisation.
  • Pursuing Expert Committee Recommendations: Recommendations from expert committees, such as the Tarapore Committees, should be pursued. These recommendations include reducing fiscal deficits, lowering gross inflation rates, and addressing banking non-performing assets. Implementing these measures would enhance macroeconomic stability and strengthen the rupee’s attractiveness.

Conclusion

  • The government’s road map for the internationalisation of the rupee holds immense potential for Indian businesses, financial stability, and the government’s ability to finance deficits. With predictable currency management policies and a phased approach, the rupee’s journey towards internationalisation can contribute to India’s economic growth and strengthen its position in the global economy.

Also read:

Using a rupee route to get around a dominating dollar

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Innovations in Biotechnology and Medical Sciences

Bio-Banks

op-ed snap | Science Tech | Mains Paper 3: Awareness in various sc and tech fields
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Biobanks

Mains level: Transformative potential of Bioeconomy, India's potential and leadership capacity for global south

biobanks

Central Idea

  • The biotechnology economy, commonly known as the bioeconomy, has experienced significant growth in recent years, driven by advancements in genetic research, healthcare applications, and innovations in food security and bioproduction. However, the responsible collection, storage, and sharing of biological data, particularly in the form of biobanks, necessitate robust governance to ensure equitable access and benefit sharing.

*Relevance of the topic*

India’s participation in healthcare advancements, including vaccine development and deployment, highlights its potential in the bioeconomy.

The pharmaceutical industry, coupled with expertise in medical research, positions India as a global leader in healthcare innovation and the production of drugs and therapies.

Considering its vast populations and challenges in healthcare, personalised healthcare is the need of the hour which makes biobanks is crucial factor for India

What is the biotechnology economy?

  • The biotechnology economy, also known as the bioeconomy, refers to the sector that encompasses various activities related to biotechnology, genetic research, and the utilization of biological resources for industrial and commercial purposes.
  • It encompasses the application of biological knowledge, principles, and techniques to develop innovative products, processes, and services in sectors such as healthcare, agriculture, food production, energy, environmental conservation, and more.
  • The biotechnology economy relies on advancements in genetic engineering, genomics, bioinformatics, and other fields to understand and manipulate biological systems for practical purposes.
  • It involves the development of new drugs, therapies, and medical treatments, the improvement of agricultural crops and livestock, the production of biofuels and renewable materials, and the creation of sustainable solutions for various industries.

India’s potential in the Bioeconomy

  • Bioeconomy Market Value: India’s Bioeconomy Report projects a potential market value of US$300 billion for the bioeconomy in India by 2030. This indicates significant growth and economic prospects in the sector.
  • Biotech Start-up Growth: The number of biotech start-ups in India has witnessed exponential growth, increasing from 50 to over 5,300 in the last ten years. This thriving ecosystem reflects a robust foundation for research, development, and industrial participation in the bioeconomy.
  • Biobanking Landscape: India currently hosts 19 registered biobanks out of a total of 340 global biobanks. This infrastructure plays a crucial role in the collection, preservation, and sharing of biological data for research and development purposes.

Significance of biobanks for India

  • Medical Research and Advancements: Biobanks store biological samples, such as blood, tissue, and DNA, along with associated health information. These samples and data enable researchers to study diseases, understand genetic factors, identify biomarkers, and develop new diagnostic tools and therapies.
  • Disease Understanding and Treatment: By collecting samples and health information from individuals with specific diseases or genetic conditions, biobanks facilitate research on disease etiology, progression, and treatment options.
  • Precision Medicine and Personalized Healthcare: By analyzing genetic and molecular data stored in biobanks, researchers can identify individual variations and develop tailored treatment approaches based on a person’s unique genetic makeup.
  • Public Health and Epidemiology: By analyzing large-scale data sets from biobanks, researchers can identify risk factors, understand disease prevalence, monitor disease trends, and develop strategies for disease prevention and public health interventions.
  • Drug Development and Clinical Trials: Biobanks play a crucial role in drug development and clinical trials. They provide researchers and pharmaceutical companies with access to well-characterized biological samples and associated health data, which are essential for evaluating drug efficacy, safety, and side effects.

Inequitable Data Collection and Benefit Deployment

  • Global South Underrepresentation: The the majority of biobanks are housed in North America and Europe, covering about 95 percent of the biobanks globally. In contrast, the Global South, including India, only hosts approximately 5 percent of the world’s biobanks. This underrepresentation limits the Global South’s participation in health research and the deployment of health initiatives.
  • Research Bias: Due to the concentration of biobanks in the Global North, there is a bias in research and funding, focusing on genetic conditions and diseases that are prevalent in those regions. This bias hamper research on health challenges specific to the Global South, limiting the relevance and applicability of the findings to the populations in these regions.
  • Dissonance in Results: There is a dissonance in using samples from the Global South to cater to health requirements primarily in the Global North. This dissonance implies that research outcomes derived from data collected in the Global South may not adequately address the healthcare needs and challenges faced by the populations in that region.
  • Lack of Equitable Benefit Sharing: The lack of explicit return on results policies leads to inadequate sharing of benefits derived from the data collected in the Global South. The benefits and outcomes of research conducted using biobank data from the Global South are not shared equitably among the countries and populations from which the data originated.
  • Inequities During the Pandemic: The article cites an example of inequity during the COVID-19 pandemic, where the capacity of Afrigen, a biotech firm responsible for vaccine production in Cape Town, was limited due to the desire of private sector participants like Moderna and Pfizer to preserve their knowledge. This resulted in Africa’s reliance on global vaccine manufacturing, with only 1 percent of vaccines consumed on the continent being manufactured within Africa.

India’s contributions and leadership in the bioeconomy

  • Healthcare and Vaccine Development: India has actively contributed to healthcare and vaccine development. The country has been involved in SARS-CoV-2 vaccine development, deployment, and diplomacy. Its expertise and participation have played a crucial role in addressing global health challenges.
  • Global South Representation: India’s involvement in advocating for global South representation in biobanking governance and global platforms demonstrates its commitment to addressing inequities. India’s leadership contributes to fostering collaboration, trust, and fair participation among countries in the Global South.
  • Multilateral Engagement: India’s association with the Quadrilateral Alliance and its G20 presidency provide platforms for global diplomacy and collaboration. These engagements enable India to advocate for global governance structures and mechanisms that promote equitable access, benefit sharing, and funding in the bioeconomy.
  • National Guidelines and Best Practices: India has established guidelines and best practices for biobanking, ethical data storage, sharing, and benefit distribution. The Department of Biotechnology and the Ministry of Science and Technology have played key roles in formulating these guidelines, ensuring responsible practices in the bioeconomy.
  • Exporting Health Information and Data: India has a history of exporting health information and data, which positions it as a contributor to global health initiatives. Leveraging its experience, India can emphasize the prioritization of diseases relevant to the Global South, prevent biopiracy, and establish rules for benefit sharing to benefit countries in these regions.
  • Global Diplomacy and Platforms: India’s involvement in global platforms, such as the G20 presidency, has enabled it to expand its national regulations and contribute to the establishment of a global governance structure for biobanking and data sharing. This allows India to advocate for relief from trust issues, mechanisms for benefit sharing, and incentives for funding in the Global South.

Way forward: Addressing Inequities through Global Governance

  • Global South Representation: There is a need for greater representation of the Global South in global governance structures. This ensures that the specific requirements and perspectives of the Global South are considered in decision-making processes and policies.
  • Global Guidelines for Biobanking: There is need of the formulation of global guidelines for biobanking to establish standards and best practices. These guidelines would address ethical data collection, storage, sharing, and benefit distribution, taking into account the specific needs and concerns of the Global South.
  • Equitable Benefit Sharing: It is important to explicit return on results policies to ensure equitable benefit sharing. These policies would ensure that the benefits derived from data collected in the Global South are shared back with the countries and populations from which the data originated.
  • Collaboration and Knowledge Exchange: Global governance in the bioeconomy should foster collaboration, knowledge exchange, and technology transfer between countries and regions. This collaboration helps address disparities, build trust, and promote capacity-building efforts in the Global South.
  • Addressing Obstacles and Barriers: Global governance should address obstacles and barriers to data hosting, collection, and sharing in the Global South. This may include financial constraints, technological limitations, and infrastructure gaps that hinder effective participation and contribution.
  • Private Sector Engagement:  It is essential to define the role of the private sector in research and emergencies. Global governance should encourage responsible and ethical private sector engagement, fostering investment, innovation, and knowledge sharing in the Global South.

Conclusion

  • The promotion of equitable governance in biobanking is crucial for advancing scientific research, ensuring equitable healthcare, and addressing the unique healthcare challenges faced by the global South. The time is ripe for India to champion this cause and drive transformative change in the field of biobanking on a global scale.

Also read:

Mainstreaming Biodiversity: A Pivotal Step Towards a Sustainable Future

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Issues related to Economic growth

How India can leverage its biggest strength?

op-ed snap | Economics | Mains Paper 3: Issues relating growth and development, employment
Note4Students

From UPSC perspective, the following things are important :

Prelims level: NA

Mains level: India's demography: opportunity or disaster, challenges and priorities

India

Central Idea

  • India’s greatest strength lies in its vast manpower. In the coming 25 years, the country has the potential to experience a golden era, provided it effectively utilizes its favorable demographic composition.

Relevance of the topic

The current population of India is 1,420,681,800, based on Worldometer elaboration of the latest United Nations data.

The growth is driven by India’s large, dynamic and young population, with 65% of Indians being under 35 years old.

However, one of the greatest challenges facing young India’s is unemployment. This raises core question is this an opportunity or demographic disaster

There is a need to create opportunities for the existing labour force and the new entrants into the labour market by improving their productivity.

India’s Demographic Advantage

  • Young Workforce: India’s average age of 29 years, compared to countries like the US (38), China (38), France (42), Germany (45), and Japan (48), highlights its advantage of having a younger population, which can contribute to economic growth and productivity.
  • Favorable Dependency Ratio: The projected old-age dependency ratios indicate India’s advantage in terms of a smaller proportion of the population requiring support from the working-age population. For instance, while India’s projected old-age dependency ratio is 37% in 2075, France is projected to have 55.8%, Japan 75.3%, the US 49.3%, the UK 53%, and Germany 63.1%.
  • Rising Working-Age Population: India is currently in a phase where its working-age population is increasing, presenting a potential workforce that can drive economic growth and development for several decades.
  • Potential for Labor Supply: With its large population and a growing workforce, India has the potential to become a significant source of labor supply for the rest of the world. This can attract investment and outsourcing opportunities, further boosting economic growth.
  • Abundant Human Capital: India possesses a vast pool of educated and skilled individuals, which contributes to its human capital advantage. This workforce can drive innovation, productivity, and economic competitiveness across various sectors.
  • Consumer Market: India’s large population provides a substantial domestic consumer market, offering significant opportunities for businesses to cater to the needs and demands of a vast consumer base, driving economic activity.
  • Innovation and Entrepreneurship: The young and dynamic population in India fosters a culture of innovation and entrepreneurship, contributing to the development of new industries, technologies, and solutions, creating employment opportunities and driving economic progress.
  • Potential for Economic Growth: By effectively utilizing its demographic advantage, India has the potential to achieve higher rates of economic growth and improve its standard of living.
  • Global Competitiveness: A young and skilled labor force enhances India’s competitiveness in the global market, attracting foreign investment, promoting export-oriented industries, and positioning India as a preferred business and investment destination.
  • Demographic Dividend: India’s favorable demographic composition presents the opportunity to unlock the demographic dividend, leading to accelerated economic growth and development through investments in education, skill development, healthcare, and employment opportunities.

Lessons learned from Asian success stories accordingly

  • Harnessing the Demographic Dividend: Asian countries like China, Japan, South Korea, Malaysia, and Singapore have effectively utilized their favorable demographics to drive economic growth and development. India, with its young workforce, can learn from these examples and focus on maximizing the potential of its demographic dividend.
  • Focus on Labor-Intensive Manufacturing: Asian success stories have demonstrated the importance of capitalizing on labor-intensive manufacturing sectors to create employment opportunities. India can prioritize these sectors, such as textiles, toys, footwear, auto components, and agricultural processing, to leverage its abundant labor force.
  • Structural Transformations: Asian nations have undergone structural transformations by transitioning from labor-intensive industries to more advanced sectors. India can learn from these examples and emphasize technological advancements, innovation, and high-value manufacturing to sustain economic growth and enhance competitiveness.
  • Investment in Infrastructure: Developing robust infrastructure is crucial for economic growth. Asian countries have recognized the significance of infrastructure development in reducing trade and transaction costs, improving connectivity, and attracting investments. India should focus on infrastructure development to support its economic growth objectives.
  • Trade and Investment Facilitation: Asian success stories have implemented trade facilitation measures and pursued policies to attract foreign direct investment. India can learn from these experiences by adopting measures to facilitate trade, improve ease of doing business, and create a favorable investment climate.
  • Support for MSMEs: Micro, Small, and Medium Enterprises (MSMEs) play a pivotal role in the manufacturing sector. Asian countries have provided support to MSMEs to enhance their competitiveness, scale, and integration into global supply chains. India can prioritize support for MSMEs to drive manufacturing growth and job creation.
  • Emphasis on Skill Development: Asian success stories have recognized the importance of skill development in enhancing labor force productivity. India should invest in skilling initiatives, re-skilling, and up-skilling programs to improve employability and align the workforce with evolving industry demands.
  • Quality Education and Healthcare: Asian nations have prioritized investments in quality education and healthcare. India can learn from these examples by focusing on improving access to quality education and healthcare services, which will contribute to a skilled workforce and a healthy labor force.
  • Government Reforms and Policies: Asian success stories have been supported by proactive government reforms and policies. India should implement favorable policies related to labor laws, taxation, ease of doing business, and intellectual property rights to create an enabling environment for economic growth and entrepreneurship.
  • Long-term Vision and Implementation: Asian countries that have achieved sustained success have demonstrated long-term vision and commitment to implementing policies and reforms. India should adopt a similar approach by formulating long-term strategies and ensuring consistent implementation to drive sustainable economic growth.

What India needs to capitalize on its demographic dividend?

  • Skilling and Education: India needs to focus on skill development programs such as the Jan Shikshan Sansthan, the Pradhan Mantri Kaushal Vikas Yojana, and the National Apprenticeship Promotion Scheme. These programs have shown success in increasing human resource supply in various sectors. However, efforts should be made to upscale and improve the skills of the labor force, especially in the unorganized sector where underpaid jobs prevail.
  • Job Creation and Employment Opportunities: India should prioritize sectors with high labor intensity, such as textiles, toys, footwear, auto components, sports goods, agricultural processing, restaurants, hotels, mining, construction, healthcare, and caregiving services. These sectors have significant potential for employment generation. Additionally, the focus should be on infrastructure development to reduce trade and transaction costs and create an environment conducive to doing business.
  • Industry and Infrastructure Development: India should accelerate infrastructure development to support economic growth and enhance competitiveness. This includes investment in transportation, energy, digital connectivity, and other critical infrastructure sectors.
  • Ease of Doing Business: To attract investments and promote entrepreneurship, India should continue its efforts to improve the ease of doing business by simplifying regulatory processes, reducing bureaucratic hurdles, and enhancing transparency.
  • Social Security and Healthcare: India should work towards improving access to quality healthcare services and implementing robust social security programs. Measures like the Ayushman Bharat and Pradhan Mantri Bhartiya Janaushadhi Pariyojana mentioned in the article can help in achieving these goals.
  • Government Reforms and Policies: Implementing favorable labor laws, rationalizing taxation systems, and providing policy stability are essential for creating an enabling environment for economic growth. There is importance of reforms such as the National Education Policy 2020, which aims to update knowledge and ensure productive employment opportunities.

Way Forward: Priority areas

  1. Improving Education Quality:
  • India should prioritize the implementation of the National Education Policy 2020, which emphasizes knowledge updating and aims to provide inclusive, equitable, and quality education at all levels.
  • Steps should be taken to address challenges such as non-functional schools, resistance to change, and inadequate resources.
  • Providing access to quality education up to higher secondary levels for all is essential to create a productive labor force.
  1. Ensuring Quality Healthcare:
  • The government should continue implementing initiatives like Ayushman Bharat and the Pradhan Mantri Bhartiya Janaushadhi Pariyojana to improve healthcare equity.
  • Efforts should be made to make drug prices affordable and accessible, and steps should be taken to ensure financial medical protection, such as universal insurance and adequate medical infrastructure.
  • Quality health infrastructure for all will contribute to a healthy and productive labor force.
  1. Accelerating Reforms for Future Success:
  • India should accelerate the implementation of reforms and flagship programs to unlock its demographic dividend and drive economic growth.
  • Streamlining bureaucratic processes, improving ease of doing business, and creating an investor-friendly environment are essential to attract investments and foster entrepreneurship.
  • Additionally, continued infrastructure development, trade facilitation measures, and reforms in labor laws and taxation systems will support the growth of industries and enhance India’s competitiveness in the global market.

Conclusion

  • India’s demographic dividend offers a unique opportunity for growth and development in the coming years. By prioritizing skill development, creating employment opportunities, enhancing productivity, ensuring access to quality healthcare and education, and implementing crucial reforms, India can fully harness its demographic advantage. The nation has the potential to become a global labor force supplier and secure a prosperous future.

Also read:

India’s Population Growth: Dividend or a Disaster?

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Digital India Initiatives

Data Protection Bill approved by Cabinet: Content, concerns

op-ed snap | Governance | Mains Paper 2: E-Governance
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Digital Personal Data Protection Bill

Mains level: Digital Personal Data Protection Bill, 2022, significance, concerns and its implications

protection

Central Idea

  • Nearly six years after the Supreme Court recognized privacy as a fundamental right, the Indian government has taken a significant step towards safeguarding personal data with the Digital Personal Data Protection Bill, 2022. This legislation, expected to be tabled in the upcoming Monsoon Session of Parliament, aims to address concerns regarding data protection, while considering the country’s trade negotiations with international partners.

*Relevance of the topic*

Today India has more than 800 million internet users and it is expected to increase by 45% in the next five years to 900 million in 2025

Given the dynamic nature of the online sphere, privacy concerns and issues are rapidly changing.

Need for robust data protection policy and its implications on citizens

Significance of Privacy Law/ Data Protection Bill, 2022

  • Filling the Legislative Gap: The proposed bill aims to fill the legislative gap in India regarding the protection of personal data. By enacting a comprehensive privacy law, it will provide a dedicated legal framework for the collection, storage, processing, and transfer of personal data, addressing concerns that were previously unregulated.
  • Strengthening Data Protection: The bill seeks to strengthen data protection measures by placing obligations on entities, referred to as data fiduciaries, to maintain the accuracy and security of personal data. It also emphasizes the importance of deleting data once its purpose has been fulfilled, promoting responsible data management practices.
  • Trade Negotiations and Global Alignment: The bill’s enactment holds significance in India’s trade negotiations, particularly with regions like the European Union. Implementing a robust privacy law aligns India with international data protection standards, such as the GDPR, which can facilitate smoother data transfers and trade relations with countries that prioritize privacy.
  • Consumer Trust and Confidence: Establishing a privacy law builds consumer trust and confidence in the digital ecosystem. It assures individuals that their personal data will be protected, thereby encouraging greater participation in digital transactions, e-commerce, and other online activities. Increased trust contributes to the growth of the digital economy.
  • Accountability and Remedies: The bill includes provisions for accountability and remedies in case of privacy breaches. It empowers individuals to seek legal remedies and file complaints against entities that violate the privacy provisions. This promotes a culture of accountability among organizations and strengthens individuals’ rights.
  • Harmonizing Data Protection and National Interests: The proposed bill aims to strike a balance between data protection and national interests. While safeguarding privacy rights, it also provides exemptions for the central government and its agencies on grounds of national security, foreign relations, and public order, ensuring that legitimate national interests are taken into account

Concerns Surrounding the Draft Bill

  • Wide-ranging Exemptions: One of the major concerns is the inclusion of wide-ranging exemptions for the central government and its agencies. These exemptions allow the government to bypass certain provisions of the bill based on reasons such as national security, relations with foreign governments, and maintenance of public order. Critics argue that these exemptions could potentially undermine privacy protections and weaken the scope of the law.
  • Dilution of the Data Protection Board: The role of the data protection board, which serves as an adjudicatory body for privacy-related disputes, is perceived to be diluted in the draft bill. The control of the central government in appointing board members and determining the terms and conditions of their service raises concerns about the independence and effectiveness of the board.
  • Potential Impact on the Right to Information (RTI) Act: There are concerns that the draft bill could have implications for the Right to Information (RTI) Act. The protection of personal data of government functionaries under the privacy law could make it more challenging for information to be shared with RTI applicants, potentially affecting transparency and accountability

How does India’s proposal compare with other countries?

  • European Union (EU) Model: The EU’s General Data Protection Regulation (GDPR) is a comprehensive data protection law that sets high standards for the processing and protection of personal data. The GDPR is known for its stringent requirements and extensive obligations on organizations handling personal data. India’s proposed bill aims to align with international standards, including those set by the GDPR, to facilitate data transfers and trade relations with the EU.
  • United States Model: Privacy protection in the United States is primarily based on sectoral laws and regulations. The focus is on safeguarding individual liberties, with an emphasis on protection from government intrusion. The US approach allows data collection as long as individuals are informed about it. In comparison, India’s proposed bill takes a more comprehensive approach, covering various aspects of data protection and placing obligations on both government and private entities.
  • China Model: China has recently implemented new data privacy and security laws, including the Personal Information Protection Law (PIPL) and the Data Security Law (DSL). These laws grant individuals new rights over their personal data and impose restrictions on cross-border data transfers. While the specific provisions of India’s proposed bill may differ, both India and China aim to enhance data protection and privacy in the face of increasing digitalization.
  • Global Adoption: According to the United Nations Conference on Trade and Development (UNCTAD), the majority of countries globally have established data protection and privacy laws. Africa and Asia have shown significant adoption rates, with countries in these regions implementing their own privacy frameworks. It is worth noting that the level of adoption and the specifics of these laws may vary across countries.

Implications of the bill on Citizens

  1. Positive implications
  • Enhanced Privacy Protection: The bill would provide individuals with greater control over their personal data and reduce the risk of unauthorized access or misuse.
  • Strengthened Data Security: Stricter requirements for data fiduciaries to implement security measures can help safeguard sensitive data, enhancing trust and confidence in digital transactions.
  • Increased Accountability and Remedies: The bill empowers citizens by providing them with avenues to address privacy violations, ensuring that their rights are protected and promoting a culture of accountability among data handlers.
  1. Potential Negative Implications:
  • Exemptions for Government Agencies: Concerns about the government’s access to and use of personal data, leading to potential privacy risks and diminished transparency.
  • Weakened Role of the Data Protection Board: The perceived dilution of the data protection board’s role, particularly in terms of its independence and control by the central government may result in a lack of impartial adjudication and hinder citizens’ ability to seek redress for privacy violations.
  • Potential Impact on Right to Information (RTI) Act: If personal data is shielded under the privacy law, it may restrict access to information by RTI applicants, potentially affecting transparency and accountability in the public sphere.

What changes are likely in the final version?

  • Cross-border Data Flows: A key change in the final draft is a shift from a ‘whitelisting’ approach to a ‘blacklisting’ mechanism regarding cross-border data flows. This means that data transfers will be allowed to most jurisdictions by default, except for those specified in a ‘negative list’ of countries where transfers would be prohibited.
  • Stricter “Deemed Consent” Provision: The provision on “deemed consent” may be reworded to impose stricter requirements on private entities while allowing government departments to assume consent for processing personal data on grounds of national security and public interest. This change aims to strengthen privacy protections for individuals.
  • Clarification of Penalties: The final version of the bill is expected to provide clarity on penalties for data breaches. It is reported that the highest penalty for failing to prevent a data breach could be prescribed at Rs 250 crore per instance. The interpretation of “per instance” would be determined by the data protection board on a case-by-case basis.

Way forward

  • Stakeholder Consultation: Engage with privacy experts, industry representatives, and civil society organizations for comprehensive input and diverse perspectives.
  • Strengthen Privacy Safeguards: Minimize exemptions for government agencies, ensure an independent and effective data protection board, and clarify provisions on data breaches and penalties.
  • Transparency and Accountability: Establish clear guidelines for data fiduciaries, conduct regular audits, and provide accessible mechanisms for citizens to file complaints and seek redress.
  • Awareness and Education: Launch public awareness campaigns, privacy literacy programs, and collaborate with educational institutions to empower individuals with knowledge about their privacy rights.
  • International Cooperation: Align standards with international frameworks, collaborate on data transfer mechanisms, and actively participate in global privacy discussions and forums.
  • Continuous Review and Adaptation: Incorporate provisions for regular review and updates to address emerging privacy challenges and technological advancements.

Conclusion

  • As India prepares to introduce the Digital Personal Data Protection Bill, 2022, it marks a significant milestone in protecting individuals’ privacy rights and regulating data practices. However, concerns regarding exemptions for government agencies and the potential impact on the RTI Act need to be carefully addressed. By striking a balance between privacy protection and national interests, India can establish a robust framework that promotes data-driven innovation, fosters international trade relations, and ensures individuals’ control over their personal data

Also read:

Digital Personal Data Protection Bill: Need A Pre-legislative Consultation

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Festivals, Dances, Theatre, Literature, Art in News

Kanwar Yatra: What is it?

Prelims Only | History and Art & Culture | Mains Paper 1: Arts & Culture
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Kanwar Yatra

Mains level: NA

kanwar yatra

Central Idea: The Kanwar Yatra, a significant annual pilgrimage, commenced on July 4 and will continue until July 15.

What is Kanwar Yatra?

  • This pilgrimage sees millions of devotees, known as Kanwariyas or Kriyas, undertaking a journey to collect water from the Ganga River and offer it to Lord Shiva.
  • The Kanwar Yatra symbolizes the unbreakable bond between devotees and Lord Shiva and is considered an act of faith and devotion.

Mythological Origins of Kanwar Yatra

  • Samudra Manthan: Kanwar Yatra is believed to have originated from the mythological story of Samudra Manthan, where Lord Shiva consumed poison to save the world. To alleviate the effects of the poison, all the gods poured water from the Ganga River on Lord Shiva.
  • King Rama’s Offering: Another version suggests that the ritual of Kanwar Yatra began when King Ram offered water from the Ganga to a statue of Lord Shiva (shivalinga) in an earthen pot.

Customs and Rituals Performed

  • Collection of Ganga Water: Devotees, dressed in saffron attire, embark on foot to collect water from the Ganga River at Haridwar, Gomukh, and Gangotri. They carry two earthen pots filled with water, hung on a decorated bamboo stick, which they balance on their shoulders.
  • Significance of Purity: Devotees consider it essential to keep the pots from touching the ground or getting contaminated by dust, as it may impure the sacred water.
  • Challenging Journey: Kanwariyas undertake the yatra barefoot, covering long distances in challenging terrains and extreme weather conditions.

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Agricultural Sector and Marketing Reforms – eNAM, Model APMC Act, Eco Survey Reco, etc.

Tomato Crop affected by different Mosiac Viruses

Prelims Only | Science Tech | Mains Paper 3: Awareness in various sc and tech fields
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Mosaic Viruses

Mains level: NA

tomato mosiac

Central Idea

  • Tomato growers in Maharashtra and Karnataka have reported significant yield losses due to the impact of two different Mosiac Viruses.
  • The cucumber mosaic virus (CMV) has affected tomato crops in Maharashtra, while the tomato mosaic virus (ToMV) has been blamed for crop losses in Karnataka and other South Indian states.

 

Cucumber Mosaic Virus (CMV)

Tobacco Mosaic Virus (TMV)
Target Plants Various plants, including cucumbers, tomatoes, peppers, lettuce, and ornamentals Plants in the Solanaceae family, including tobacco, tomatoes, peppers, etc.
Transmission Aphids, seeds, mechanical contact, infected plant debris Direct contact, mechanical transmission, contaminated plant material
Symptoms Mosaic patterns, yellowing, stunted growth, leaf curling, distorted fruits or flowers Mosaic patterns, yellowing, leaf curling, stunted growth
Impact on Crops Reduced yield and quality Reduced yield, impact on flavor and quality
Longevity Not specified Long-term viability in dried plant debris, tobacco products, contaminated surfaces
Control Measures Vector control, seed selection, crop rotation Crop rotation, sanitation, virus-free seeds/seedlings, cultural practices
Curability No cure, management focuses on prevention No cure, management focuses on prevention

 

Impact on Tomato Crops

  • Symptoms of ToMV: Infected plants exhibit alternating yellowish and dark green areas, blisters on leaves, leaf distortion, twisting of younger leaves, necrotic spots on fruits, and reduced fruit setting.
  • Symptoms of CMV: Leaf distortion, with top and bottom leaves most affected, mosaic-like patterns of yellow and green spots in cucumber, fruit deformation, and reduced production in tomato.

Control Measures

  • ToMV: Ensuring biosafety standards in nurseries, seed treatment, careful inspection of saplings before planting, continuous monitoring for infection, and removal of infected plants are crucial.
  • CMV: Due to its wide host range, controlling aphids becomes essential. Measures include spraying quick-acting insecticides or mineral oils, monitoring aphid migration, and clearing fields of weeds and plant material that may harbor the virus.

 

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Wildlife Conservation Efforts

What is Ambergris?

Prelims Only | Enviro & Biodiversity | Mains Paper 3: Conservation, Environmental Pollution & Degradation, Eia
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Ambergris

Mains level: NA

amber

Central Idea

  • The discovery of a sperm whale carcass on the shore of the Canary Island of La Palma has led to an extraordinary find.
  • During the post-mortem examination, a pathologist found ambergris, a highly valuable substance often referred to as “floating gold,” stuck in the whale’s colon.
  • The estimated worth of the retrieved lump of ambergris is around €500,000 (Rs 4,47,62,500).

What is Ambergris?

  • Origin: Ambergris is a waxy substance formed in the digestive system of protected sperm whales.
  • Formation: One theory suggests that ambergris is produced in the gastrointestinal tract of sperm whales to aid the passage of hard objects ingested during feeding.
  • Appearance and Odour: Freshly passed ambergris is light yellowish and fatty, but it ages and turns waxy, taking on red-brownish colors. It possesses a mild, earthy, sweet smell with hints of marine odor.

Uses and Rarity of Ambergris

  • Perfume Industry: Traditionally, ambergris is used in the production of perfumes, adding a musky note.
  • Historical Uses: In the past, ambergris was utilized to flavor food, alcoholic beverages, and tobacco in certain cultures.
  • Rarity and Value: Ambergris is a scarce substance, contributing to its high demand and significant price in the international market.

Legal Restrictions in India

  • Wildlife Protection Act: Sperm whales, the source of ambergris, are a protected species under Schedule 2 of the Wildlife Protection Act in India.
  • Illegal Possession and Trade: The possession and trade of ambergris and its by-products, including in India, are prohibited under the Wildlife Protection Act of 1972.
  • Smuggling and Trade Routes: Smuggling networks involved in ambergris trade often procure the substance from coastal areas in India and transport it through countries with comparatively less stringent sea trade regulations.

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Right To Privacy

Cabinet clears Data Protection Bill

Bills/Act/Laws | Governance | Mains Paper 2: Governance, Transparency & Accountability, Citizens Charters
Note4Students

From UPSC perspective, the following things are important :

Prelims level: NA

Mains level: DPDP Bill

data

Central Idea

  • The Union Cabinet has granted clearance for the Digital Personal Data Protection (DPDP) Bill, which is set to be introduced in the upcoming Monsoon Session of Parliament.
  • This legislation aims to regulate the management of personal data of Indian residents, emphasizing explicit consent for data collection and usage.

DPDP, Bill: Key Features and Concerns

(A) Data Protection Norms and Consent

  • Data Protection Law: The DPDP Bill establishes norms for the management of personal data and mandates explicit consent from individuals whose data is collected and used.
  • Limited Transparency: More than 20,000 comments were received during the public consultation on the draft Bill, but these comments have not been made publicly available.
  • Minimal Changes: The final Bill, to be presented in Parliament, reportedly shows little deviation from the initial draft circulated for public consultation.

(B) Data Protection Board and Grievance Redressal

  • Role of the Data Protection Board: The DPDP Bill enables individuals to lodge complaints with the Data Protection Board of India, consisting of government-appointed technical experts, in case of unauthorized data usage.
  • Investigation of Breaches: The Board will initiate an investigation into reported breaches of personal data.

(C) Provisions and Penalties

  • EU Influence: The DPDP Bill draws inspiration from the EU’s General Data Protection Regulation, outlining practices for entities collecting personal data, storage, processing, and the rights of data subjects.
  • Voluntary Undertaking: Entities can admit a breach and pay a penalty as a mitigation measure to avoid court litigation.
  • Penalties and Fines: Penalties for breaches can reach up to ₹250 crore, with a possibility of upward revision to ₹500 crore. Individual offenses may attract fines starting from ₹10,000.
  • Data Protection Board’s Role: The Board will levy fines and penalties for breaches, with a maximum penalty of ₹500 crore for data breaches.

(D) Exemptions and Concerns

  • Exemptions for Courts and Law Enforcement: The Bill exempts courts and law enforcement agencies from certain requirements when processing personal data for the prevention, detection, investigation, or prosecution of offenses.
  • Concerns over RTI Amendment: An amendment in the DPDP Bill raises concerns among Right to Information activists, as it may restrict the sharing of “personal information” by government departments, potentially impeding transparency and accountability.

Potential Changes in the Final Draft

  • Cross-Border Data Flows: The approach to cross-border data transfers may shift from a ‘whitelisting’ approach to a ‘blacklisting’ mechanism.
  • Stricter Deemed Consent: The provision on “deemed consent” for private entities could be reworded to be more stringent, while government departments may assume consent for processing personal data in the interest of national security and public interest.

International Comparisons

data

  • Global Data Protection Laws: A significant number of countries have enacted data protection and privacy legislation, with the GDPR serving as a template for many jurisdictions.
  • EU, US, and China Models: The EU focuses on comprehensive data protection, the US emphasizes privacy as “liberty protection,” and China has introduced new laws on data privacy and security.

Why discuss this yet again?

  • Previous Withdrawal: An earlier version of the data protection Bill was withdrawn from Parliament in 2021 due to pushback from various stakeholders.
  • International Relevance: The DPDP Bill’s implementation is crucial for India’s trade negotiations, particularly with regions like the European Union, which has comprehensive privacy laws under the General Data Protection Regulation (GDPR).

Conclusion

  • The Bill marks a significant step toward safeguarding personal data in India.
  • The legislation introduces stricter norms for data collection and usage, emphasizing explicit consent and establishing penalties for breaches.
  • However, concerns have been raised regarding the limited transparency of the consultation process and potential exemptions that may impact transparency and accountability.

 

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Foreign Policy Watch: India-Iran

Iran dragged to International Court of Justice (ICJ)

IOCR | International Relations | Mains Paper 2: Important International Institutions
Note4Students

From UPSC perspective, the following things are important :

Prelims level: ICJ

Mains level: Iran's tarnished image in global scenario

iran icj

Central Idea

  • The UK, Canada, Sweden, and Ukraine have jointly initiated legal proceedings against Iran at the International Court of Justice, the highest court of the United Nations.
  • The case pertains to the tragic downing of a Ukrainian passenger jet in 2020, resulting in the loss of all 176 passengers and crew members.
  • Iran recently acquired the membership of SCO.

About the International Court of Justice (ICJ)
Establishment Also called World Court, was established in 1945.

Began its operations in 1946.

Located in The Hague, Netherlands.
Purpose To settle legal disputes between member states and provide advisory opinions on legal questions referred to it by authorized UN organs and specialized agencies.
Composition 15 judges elected by the UN General Assembly and the Security Council.

Judges serve for a term of 9 years and can be re-elected.
Judicial Independence Operates independently of the UN.

Its decisions are binding on the parties involved in a dispute.

Member states are obligated to comply with ICJ judgments.
Jurisdiction Over cases submitted to it by sovereign states.

Can only hear cases if both parties involved in the dispute have consented to its jurisdiction.

Provides advisory opinions to UN organs and specialized agencies.
Cases Disputes over territorial boundaries, maritime rights, human rights violations, interpretation of treaties, and state responsibility.

It has jurisdiction over both contentious cases and advisory proceedings.
Legal Systems Applies two primary sources of law:  International treaties and customary international law.

Considers general principles of law and judicial decisions as subsidiary sources.
Proceedings ICJ proceedings are public unless the court decides otherwise or the parties involved agree on privacy.
Binding Nature of Judgments ICJ judgments are legally binding on the parties involved in a dispute.

If a state fails to comply with a judgment, the matter can be brought to the attention of the UN Security Council for further action.
Enforcement Mechanism ICJ lacks its own enforcement mechanism, and it relies on the voluntary compliance of states with its judgments.

However, the UN Security Council has the power to take measures to enforce ICJ rulings.
Accessibility Accessible to all member states of the UN.

Non-member states can also become parties to cases.

Tragedy and International Response

  • Flight PS752: Details of the Ukrainian passenger jet, which was en route from Tehran to Kyiv on January 8, 2020.
  • Shooting Down: The plane was shot down shortly after takeoff.
  • Nationalities: The victims included individuals from Canada, Sweden, Ukraine, the United Kingdom, Afghanistan, and Iran, spanning a wide age range.

Iran’s Admission and Subsequent Actions

  • Failed Arbitration Request: Iran’s lack of response to arbitration request led to the filing of the case.
  • Initial Denials: Iran initially denied responsibility for the downing but later admitted that the Revolutionary Guard had mistakenly shot down the plane using two surface-to-air missiles.
  • Blaming the Operator: Iranian authorities attributed the incident to an air defense operator who allegedly mistook the Boeing 737-800 for an American cruise missile.
  • Judicial Response: An Iranian court sentenced an air defense commander to 13 years in prison for his alleged role in the downing.
  • Critique of the Trial: The countries filing the case criticized the prosecution, referring to it as a “sham and opaque trial.”

Allegations against Iran  

  • Lack of Preventive Measures: The plaintiffs argue that Iran failed to take necessary measures to prevent the intentional commission of an offence.
  • Inadequate Investigation and Prosecution: Iran is accused of conducting an impartial, transparent, and fair criminal investigation, which is inconsistent with international law.
  • Destruction of Evidence: Allegations claim that Iran withheld or destroyed crucial evidence related to the incident.
  • Harassment of Families: Iran is accused of threatening and harassing the families of the victims who sought justice.
  • Failure to Report: Iran neglected to report crucial details of the incident to the International Civil Aviation Organization.

 

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Where India lags in science, research fields, and can National Research Foundation help fix it?

op-ed snap | Science Tech | Mains Paper 3: Inclusive Growth & Issues
Note4Students

From UPSC perspective, the following things are important :

Prelims level: NA

Mains level: India's expenditure on research and development and necessity and potential of National Research Foundation (NRF)

Central Idea

  • The government’s recent approval of the National Research Foundation (NRF) has been widely hailed by the scientific community in India. The establishment of the NRF presents a significant opportunity to tackle long-standing deficiencies within the country’s scientific research sector.

*Relevance of the topic

*Despite possessing a vast pool of science and engineering graduates, extensive research institutions, and active involvement in cutting-edge scientific research, India has lagged behind several nations in research indicators.

*While the spending on research has increased over the years, it has not kept pace with the rapid growth of India’s GDP.

*It is crucial for India to harness the potential of demographic dividend

Insufficient expenditure on research and development

  • Inadequate Allocation: The Indian government has failed to meet its stated objective of allocating at least two percent of the national GDP for research and development (R&D) activities. Despite this objective being set for over two decades, the current expenditure on research as a proportion of GDP stands at only around 0.65 percent, a decline from 0.8 percent at the beginning of the millennium.
  • Stagnant Growth: The share of research expenditure as a percentage of GDP has remained stagnant for the past decade, indicating a lack of significant progress in increasing investment in R&D.
  • Falling Behind Global Standards: In comparison to other countries, India’s expenditure on R&D falls short. According to the 2021 UNESCO Science Report, at least 37 countries spent more than one percent of their GDP on R&D in 2018, with 15 of them surpassing the two percent mark. Globally, the average percentage of GDP spent on R&D is 1.79 percent, indicating that India lags behind in research investment.
  • Insufficient Funding per Researcher: The amount allocated per researcher in India is significantly lower compared to other nations. In 2020, India spent only $42 (in purchasing power parity terms) per researcher. In contrast, countries like Israel, South Korea, and the United States invested substantially higher amounts per researcher, highlighting the need for increased financial support to facilitate quality research.
  • Disproportionate Growth: While funding for research in India has increased over the years, it has not kept pace with the country’s economic growth. As a result, the share of research expenditure as a proportion of GDP has declined, indicating a mismatch between the growth of the research sector and overall economic development.

Significance of sufficient allocation for research and development (R&D) activities in India

  • Promoting Innovation and Technological Advancement: Adequate funding for R&D fosters innovation and technological advancement in various sectors. It allows scientists, researchers, and institutions to conduct groundbreaking research, develop new technologies, and create intellectual property.
  • Addressing Societal Challenges: Sustained investment in R&D enables the exploration of solutions to pressing societal challenges. It supports research in areas such as healthcare, agriculture, energy, climate change, and infrastructure development.
  • Enhancing Global Competitiveness: Adequate funding for R&D is crucial for India to remain globally competitive. It allows the country to stay at the forefront of scientific advancements, technological breakthroughs, and innovation. By investing in R&D, India can nurture a skilled workforce, attract talent, foster collaborations with international partners, and build a strong knowledge-based economy.
  • Driving Economic Growth and Job Creation: R&D stimulates demand for goods and services, creates employment opportunities, and contributes to overall economic development. Robust R&D investment promotes entrepreneurship, encourages startups, and facilitates the commercialization of research outcomes, leading to job creation and economic prosperity.
  • Strengthening Academic Institutions: Sufficient allocation for R&D enables universities and research institutions to enhance their research infrastructure, attract top talent, and engage in cutting-edge research. This strengthens the academic ecosystem, promotes interdisciplinary collaboration, and facilitates knowledge transfer between academia and industry.
  • Leveraging Global Collaboration: Adequate investment in R&D enables India to actively participate in global collaborations and leverage international expertise. It encourages knowledge sharing, joint research projects, and scientific collaborations with renowned institutions worldwide.

India’s research output and collaboration

  • Doctorates and Research Output: India produces a significant number of science and engineering doctorates. In the year 2020-21, India produced 25,550 doctorates, with 14,983 in science and engineering disciplines. In terms of absolute numbers, India ranks among the top countries globally. However, considering India’s large population, the number of researchers per million is relatively low compared to other developing nations.
  • Publications: Indian researchers have shown improvement in publishing articles in international science and engineering journals. In 2020, they published 149,213 articles, which is almost two and a half times more than a decade earlier. However, Indian publications only constituted 5 percent of all articles published globally. China contributed 23 percent, while the United States accounted for 15.5 percent.
  • Patents: In 2021, India filed a total of 61,573 patents, making it the sixth-largest in the world in terms of patent filings. However, this number is significantly lower compared to countries like China and the United States, which filed millions of patents in the same year.

Necessity of National Research Foundation (NRF)

  • Addressing Funding Issues: The NRF has the potential to address the issue of insufficient funding for research and development (R&D) activities in India. By providing a centralized funding mechanism, the NRF can streamline and optimize the allocation of resources, ensuring that sufficient funds are directed towards scientific research.
  • Coupling Education and Research: One of the key areas where India faces an anomaly is the disconnect between education and research. The NRF places emphasis on rectifying this by coupling education and research.
  • Strengthening Research in Universities: The NRF aims to enhance research capabilities in universities. Currently, only a small percentage of Indian universities engage in active research. The NRF’s focus on rectifying this anomaly can lead to the establishment of robust research ecosystems within universities, making them centres for research and development activities.
  • Promoting Collaboration and Innovation: By providing a platform for interdisciplinary collaborations, facilitating knowledge-sharing, and encouraging industry-academia partnerships, the NRF can foster innovation, accelerate the translation of research outcomes into practical applications, and promote entrepreneurship.
  • Addressing Gender Disparity: The NRF can also contribute to addressing the gender disparity in the scientific research sector. By prioritizing gender diversity and inclusivity in research funding and initiatives, the NRF can work towards increasing the representation of women in scientific research, fostering an environment that is more equitable and diverse.

Conclusion

  • The establishment of the National Research Foundation holds tremendous promise for rectifying deficiencies in India’s scientific research sector. It is imperative for the government, scientific community, and relevant stakeholders to collaborate and provide the necessary support to ensure the success of the NRF in transforming India’s research landscape

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

A macro view of the fiscal health of States

op-ed snap | Economics | Mains Paper 3: Indian Economy
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Key economic concepts

Mains level: Fiscal imbalance and its impact on an economy

Central Idea

  • In India, the States play a crucial role in revenue mobilization, government expenditure, and borrowing. Understanding their fiscal situation is essential for drawing evidence-based conclusions about the country’s overall fiscal health.

Relevance of the topic

Despite the decrease in fiscal deficits, it remains important to address the challenges associated with fiscal imbalances, including persistence of revenue deficits in many States

Revise key concepts Fiscal deficit, revenue deficit, Debt-to-GDP ratio etc

Fiscal imbalance and its impact on an economy and thereby social welfare.

The fiscal imbalance at present

  1. Reduction in Fiscal Deficit:
  • There has been a significant reduction in fiscal deficits at both the Union and State levels. The Union’s fiscal deficit decreased from 9.1% of GDP in 2020-21 to 5.9% in 2023-24 (BE).
  • The aggregate State fiscal deficit also decreased from 4.1% of GDP in 2020-21 to 3.24% in 2022-23 (RE).
  • Major States are expected to achieve a fiscal deficit of 2.9% of GDP in 2023-24 (BE).
  1. Revenue Deficit Challenge:
  • Despite the reduction in fiscal deficits, there is persistence of revenue deficits in many States.
  • Out of the 17 major States analyzed, 13 have a deficit in the revenue account for the fiscal year 2023-24 (BE).
  • Seven States, namely Andhra Pradesh, Haryana, Kerala, Punjab, Rajasthan, Tamil Nadu, and West Bengal, experience fiscal deficits primarily driven by revenue deficits.
  1. High Debt-to-GSDP Ratios: Some of the States with revenue deficits also have high debt-to-GSDP ratios. This indicates that these States have accumulated significant levels of debt relative to their Gross State Domestic Product (GSDP).

The Impact of fiscal imbalance on an Economy

  • Macroeconomic Instability: Fiscal imbalances, such as high fiscal deficits and revenue deficits, can lead to macroeconomic instability. Large deficits may increase government borrowing, which can put upward pressure on interest rates, crowd out private investment, and potentially lead to inflationary pressures. This instability can hinder economic growth and create uncertainty in the business environment.
  • Increased Debt Burden: Persistent fiscal imbalances often result in increased government debt levels. High levels of public debt can have adverse consequences, including increased debt servicing costs, reduced fiscal flexibility, and potential credit rating downgrades. A higher debt burden can also limit the government’s ability to invest in critical areas such as infrastructure, education, and healthcare.
  • Reduced Public Investments: Fiscal imbalances may necessitate fiscal consolidation measures, such as expenditure cuts and reduced public investments. This can impact critical areas of public spending, including infrastructure development, social welfare programs, and public services. Reduced investments can hinder long-term economic growth and development.
  • Limited Policy Space: Fiscal imbalances can limit the government’s ability to implement countercyclical fiscal policies during economic downturns. A high debt burden or constrained fiscal capacity may prevent the government from effectively using fiscal stimulus measures to boost aggregate demand and support economic recovery.
  • Pressure on Social Welfare: Fiscal imbalances may lead to reductions in social welfare programs and public services. Austerity measures implemented to address fiscal imbalances can disproportionately affect vulnerable populations and hinder efforts to address income inequality and social welfare needs.
  • Investor Confidence and Credit Ratings: Persistent fiscal imbalances can erode investor confidence and negatively impact the country’s credit ratings. A lower credit rating can increase borrowing costs, discourage foreign investment, and limit access to international capital markets.
  • Inter-Generational Equity: Fiscal imbalances, particularly when driven by high levels of public debt, can have inter-generational equity implications. The burden of repaying debt and managing fiscal imbalances may fall on future generations, impacting their ability to invest, save, and achieve sustainable economic growth.

Reducing Revenue deficit: Way forward

  • Link Interest-Free Loans to Revenue Deficit Reduction: Implement a mechanism where interest-free loans provided by the Union Government to States are linked to a reduction in revenue deficits. This incentivizes States to prioritize revenue generation and reduce reliance on borrowed funds for revenue expenditure.
  • Defined Time Path for Revenue Deficit Reduction: Establish a clear timeline and targets for reducing revenue deficits in States. This includes setting specific goals for revenue deficit reduction and developing a credible fiscal adjustment plan to achieve those targets.
  • Performance Incentive Grants: Introduce performance incentive grants to reward States that effectively reduce their revenue deficits. The grants can be designed based on the recommendations of previous Finance Commissions, considering factors such as the extent of deficit reduction, fiscal discipline, and efficient revenue management.
  • Fiscal Adjustment and Expenditure Rationalization: Encourage States to undertake fiscal adjustment measures to align revenue and expenditure. This involves conducting a detailed analysis of expenditure patterns, prioritizing essential spending, and identifying areas for rationalization and efficiency gains.
  • Strengthen Revenue Mobilization: Enhance efforts to improve revenue mobilization by implementing measures such as broadening the tax base, improving tax administration and compliance, and exploring new revenue sources. This includes ensuring effective collection of Goods and Services Tax (GST) and non-GST revenues.
  • Public Financial Management Reforms: Strengthen public financial management systems to enhance transparency, accountability, and efficient utilization of resources. This includes improving budgeting processes, expenditure tracking, and financial reporting mechanisms to monitor and control revenue and expenditure.
  • Long-Term Revenue Planning: Develop a comprehensive long-term revenue plan that aligns with the country’s development goals. This involves forecasting revenue trends, identifying potential revenue sources, and implementing policies that support sustainable revenue generation over the long term.
  • Capacity Building: Invest in building the capacity of State governments in revenue management, tax administration, and expenditure control. This includes providing training and technical assistance to enhance their skills and capabilities in managing revenue deficits effectively.
  • Public Awareness and Participation: Conduct public awareness campaigns to educate citizens about the importance of revenue generation, fiscal discipline, and the impact of revenue deficits on public services. Foster public participation in budgeting processes to promote transparency and accountability.
  • Regular Monitoring and Reporting: Establish a robust monitoring and reporting mechanism to track the progress of revenue deficit reduction efforts. Regularly assess and report the performance of States in revenue mobilization and deficit reduction to ensure accountability and facilitate necessary corrective actions.

Prelims mark enhancerDeficit Financing in India | Financing | EconomicsDebt to GDP Ratio - What Is It, Formula & Calculation

Conclusion

  • Effectively managing revenue deficits is crucial for achieving fiscal balance and sustainable economic growth. By adopting a macro view and implementing appropriate measures and incentives, India can consolidate revenue deficits in its States. This would ensure fiscal stability, stimulate State-specific growth, and maintain macroeconomic stability at the national level

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Foreign Policy Watch: India-SCO

Iran Joins Shanghai Cooperation Organisation (SCO)

Prelims Only | International Relations | Mains Paper 2: Bilateral, Regional and Global Groupings and agreements involving India
Note4Students

From UPSC perspective, the following things are important :

Prelims level: SCO

Mains level: Not Much

Central Idea

  • Prime Minister Modi welcomed Iran as the newest member of the Shanghai Cooperation Organisation (SCO) during the virtual summit of the grouping.
  • Iran’s membership has been discussed for years, and recent geopolitical shifts have made it more relevant.

About SCO

  • The SCO, formed in 2001, aims to enhance regional cooperation in combating terrorism, separatism, and extremism in Central Asia.

Expansion of the SCO

  • Previous membership: The SCO consisted of eight member countries, including China, Russia, India, Pakistan, and the Central Asian nations of Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan.
  • Observer and Dialogue Partner status: Afghanistan, Belarus, Iran, and Mongolia have Observer status, while Azerbaijan, Armenia, Cambodia, Nepal, Turkey, and Sri Lanka hold Dialogue Partner status.

Importance of Iran’s Membership

  • Nuclear deal context: After signing the nuclear deal (JCPOA) in 2015, Iran’s path to SCO membership was facilitated.
  • Changing geopolitical landscape: The US withdrawal from Afghanistan has created opportunities for increased Chinese influence in the region.
  • Expanding alliances: Iran has sought to establish closer ties beyond its traditional ally Russia, including reaching out to Saudi Arabia and opening a border market with Pakistan.

Geopolitical Implications

  • China’s interests: Iran’s energy resources and cooperation in areas like oil are beneficial to China as it seeks to counter the US.
  • Russia’s alliances: Russia aims to strengthen its position by building alliances within the SCO, including potential full membership for Belarus.
  • US-India relations: India’s growing partnership with the US and their shared democratic values contrast with Chinese authoritarianism, creating a delicate balancing act for India.

India’s Balancing Act

  • Maintaining partnerships: India has strengthened ties with the US through significant technology and defence agreements, emphasizing shared democratic values.
  • Historical ties with Iran: India has had traditional commercial ties with Iran, primarily in the import of crude oil.
  • Challenges in balancing: India’s shifting alliances with the US and historical ties with Iran pose challenges as the dynamics of the SCO evolve.

Conclusion

  • Iran’s membership in the SCO signifies the changing geopolitical landscape and the increasing influence of China and Russia in the region.
  • India faces the challenge of balancing its partnerships with the US and historical ties with Iran while navigating the evolving dynamics within the SCO.

 

Also read

PM Modi to host SCO 2023 Summit

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Health Sector – UHC, National Health Policy, Family Planning, Health Insurance, etc.

Leptospirosis: A disease that surges in monsoons

Prelims Only | Science Tech | Mains Paper 3: Awareness in various sc and tech fields
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Leptospirosis

Mains level: Not Much

lepto

Central Idea

  • Leptospirosis has emerged as an important infectious disease in the world today.
  • It is a potentially fatal zoonotic bacterial disease that tends to have large outbreaks after heavy rainfall or flooding.

What is Leptospirosis?

  • Leptospirosis is a zoonotic bacterial disease that poses a significant global health threat, particularly after heavy rainfall or flooding.
  • It affects millions of people annually, with a high mortality rate, and its burden is expected to increase in the future.
  • The disease is caused by the bacterium Leptospira interrogans, primarily transmitted from animals to humans.

Disease Transmission and Risk Factors

  • Disease transmission: Leptospira is shed in the urine of infected animals, contaminating soil and water.
  • Carriers: Both wild and domestic animals, including rodents, cattle, pigs, and dogs, can transmit the disease.
  • Human exposure: Direct contact with animal urine or indirectly through contaminated soil and water poses a risk.
  • Occupational hazards: Agricultural workers, animal handlers, and those in sanitary services are at an increased risk.
  • Recreational activities: Engaging in water-based activities in contaminated lakes and rivers can also raise the risk.

Symptoms and Misdiagnosis

  • Range of symptoms: Leptospirosis symptoms vary from mild flu-like illness to life-threatening conditions affecting multiple organs.
  • Misdiagnosis challenges: Symptoms mimic other diseases like dengue, malaria, and hepatitis, leading to underreporting and limited awareness.
  • Limited access to diagnostics: Lack of reliable diagnostic tools hinders accurate disease detection.
  • Lack of environmental surveillance: Insufficient monitoring of the environment contributes to underestimating the disease burden.

Misconceptions and Preventive Measures

  • Reservoir hosts: Rats are not the sole cause; various animals act as reservoir hosts.
  • Environmental factors: Humidity and extreme weather events like floods increase the risk of exposure.
  • Sanitary conditions: Poor waste management, high density of stray animals, and inadequate sanitation facilities contribute to the disease spread.
  • Prevention strategies: Adopting a ‘One Health’ approach involving humans, animals, and the environment is crucial.
  • Personal protective equipment: People working with animals or in flooded areas should use gloves and boots.
  • Animal health and prevention: Ensuring sanitary animal-keeping conditions reduces the risk of leptospirosis transmission.
  • Health education and awareness: Promoting proper hygiene practices, educating about the disease, and improving health literacy are essential preventive measures.

 

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Capital Markets: Challenges and Developments

GIFT NIFTY: Connecting India and Singapore’s Capital Markets

Prelims Only | Economics | Mains Paper 3: Indian Economy
Note4Students

From UPSC perspective, the following things are important :

Prelims level: GIFT NIFTY

Mains level: NA

gift

Central Idea

  • GIFT NIFTY (formerly known as SGX NIFTY) commenced trading from GIFT City in Gujarat, marking the first cross-border initiative between India and Singapore’s capital markets.
  • The trading session witnessed over 30,000 trades, signifying the growing significance of this collaboration.

What is GIFT NIFTY?

  • The migration to GIFT NIFTY was initiated by PM Modi in July 2022.
  • GIFT NIFTY plays a crucial role in expanding GIFT IFSC’s reach to foreign investors and enhancing the capital market ecosystem in GIFT City.
  • The collaboration between SGX and NSE strengthens the connection between two rapidly growing economies.
  • NSE IX is restricted from entering similar arrangements with other exchanges, providing stability to the partnership.
  • The initial five-year contract can be extended for an additional two years.

Operating time

  • GIFT NIFTY establishes a trading link where trading and matching take place in India, while clearing and settlement occur in Singapore.
  • It operates from 6:30 am to 3:40 pm in the Asia time zone.
  • The second session, from 4:35 pm to 2:45 am (next day), targets investors from the United States and Europe.

Deal between SGX and NSE

  • Revenue sharing: The five-year contract establishes a 50:50 revenue-sharing arrangement between Singapore Exchange (SGX) and NSE International Exchange (NSE IX).
  • Initial revenue split: For Singapore-generated business, SGX will receive 75% of the revenue, while NSE will receive the remaining 25%.
  • IFSC business: NSE will retain 75% of the International Financial Service Centre (IFSC) business, with the remaining 25% going to SGX.
  • Future volume-based sharing: Once a “threshold volume” is reached, the revenue sharing will be equally split between both entities.

Shift to GIFT NIFTY

  • Ceasing SGX NIFTY: On June 30, trading on SGX NIFTY in Singapore ended, with the entire trading volume and liquidity transitioning to GIFT IFSC.
  • Rechristened GIFT NIFTY: The trading platform was renamed GIFT NIFTY, offering four products: GIFT Nifty 50, GIFT Nifty Bank, GIFT Nifty Financial Services, and GIFT Nifty IT derivatives contracts.

Back2Basics: GIFT City, Gandhinagar

  • GIFT city is India’s first operational smart city and international financial services centre (much like a modern IT park).
  • The idea for GIFT was conceived during the Vibrant Gujarat Global Investor Summit 2007.
  • The initial planning was done by East China Architectural Design & Research Institute (ECADI).
  • Currently approximately 225 units/companies are operational with more than 12000 professionals employed in the City.

Key features

  • The entire city is based on the concept of FTTX (Fibre to the home/office).
  • The fiber optic is laid in fault-tolerant ring architecture so as to ensure maximum uptime of services.
  • Every building in GIFT City is an intelligent building.
  • There is piped supply of cooking gas. India’s first city-level DCS (district cooling system) is also operational at GIFT City.

 

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