Note4Students
From UPSC perspective, the following things are important :
Prelims level: RTE
Mains level: RTE, Corporal Punishment
Three private school teachers in Pune have been booked under the Juvenile Justice Act over allegedly thrashing three Class 10 students, and threatening to grade them poorly in internal assessments
What is Corporal Punishment?
- By definition, corporal punishment means punishment that is physical in nature.
- There is NO statutory definition of ‘corporal punishment’ targeting children in the Indian law.
- The Right of Children to Free and Compulsory Education (RTE) Act, 2009 prohibits ‘physical punishment’ and ‘mental harassment’ under Section 17(1) and makes it a punishable offence under Section 17(2).
Identifying corporal punishments
- According to the Guidelines for Eliminating Corporal Punishment in Schools issued by the National Commission for Protection of Child Rights (NCPCR), physical punishment is understood as any action that causes pain, hurt/injury and discomfort to a child, however light.
- Examples include hitting, kicking, scratching, pinching, biting, pulling the hair, boxing ears, smacking, slapping, spanking, hitting with any implement (cane, stick, shoe, chalk, dusters, belt, whip), giving electric shock and so on.
- It includes making children assume an uncomfortable position (standing on bench, standing against the wall in a chair-like position, standing with school bag on head, holding ears through legs, kneeling, forced ingestion of anything, detention in the classroom, library, toilet or any closed space in the school.
What else is included?
- Mental harassment is understood as any non-physical treatment that is detrimental to the academic and psychological well-being of a child.
- This includes sarcasm, calling names and scolding using humiliating adjectives, intimidation, using derogatory remarks for the child, ridiculing or belittling a child, shaming the child and more.
Safeguards against corporal punishment
- Section 17 of the Right to Education Act, 2009, imposes an absolute bar on corporal punishment.
- Section 75 of the Juvenile Justice Act prescribes punishment for cruelty to children.
- Violation would invite punishment of rigorous imprisonment upto five years and fine up to Rs 5 lakh.
- If the child is physically incapacitated or develops a mental illness or is rendered mentally unfit to perform regular tasks or has risk to life or limb, then imprisonment may extend upto ten years.
Exceptions
- The RTE Act does not preclude the application of other legislation that relates to the violations of the rights of the child.
- For example, booking the offenses under the IPC and the SC and ST Prevention of Atrocities Act of 1989.
- In theory, corporal punishment is covered by all the provisions under Indian law that punish perpetrators of physical harm.
What do NCPCR guidelines say about eliminating corporal punishment?
The NCPCR guidelines for eliminating corporal punishment against children require every school to develop a mechanism and frame clear-cut protocols to address the grievances of students.
- Drop boxes are to be placed where the aggrieved person may drop his complaint and anonymity is to be maintained to protect privacy.
- Every school has to constitute a ‘Corporal Punishment Monitoring Cell’ consisting of two teachers, two parents, one doctor, and one lawyer (nominated by DLSA).
Who is entrusted with the responsibility to ensure children are protected?
- There are relevant authorities earmarked to ensure the protection of children in schools.
- Under Section 31 of the RTE Act, the National Commission for Protection of Child Rights (NCPCR) and the State Commissions for Protection of Child Rights (SCPCRs) have been entrusted with the task of monitoring children’s right to education.
- The state governments under their RTE rules have also notified block/district level grievance redressal agencies under the RTE Act.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Disposal of Seized Narcotics
Mains level: Not Much
The Narcotics Control Bureau (NCB) has destroyed 30,000 kg of seized drugs at four locations – Kolkata, Chennai, Delhi and Guwahati — in the virtual presence of Union Home Minister.
Destruction of Seized Narcotic Drugs
- Section 52-A of the Narcotics Drugs and Psychotropic Substances (NDPS) Act, 1985 allows probe agencies to destroy seized substances after collecting required samples.
- Officials concerned must make a detailed inventory of the substance to be destroyed.
- A five-member committee comprising the area SSP, director/superintendent or the representative of the area NCB, a local magistrate and two others linked to law enforcement and legal fraternity is constituted.
- The substance is then destroyed in an incinerator or burnt completely leaving behind not any trace of the substance.
Exact procedure that is followed
- The agency first obtains permission from a local court to dispose of the seized narcotic substances.
- These substances are then taken to the designated place of destruction under a strict vigil.
- The presiding officer tallies the inventory made at the storeroom with that material brought to the spot.
- The entire process is videographed and photographed.
- Then one by one, all the packets/gunny bags of the substance/s are put in the incinerator.
- As per rules, committee members cannot leave the place until the seized drugs have been completely destroyed.
Which agency is authorized to carry out such an exercise?
- Every law enforcement agency competent to seize drugs is authorized to destroy them after taking prior permission of the area magistrate.
- These include state police forces, the CBI and the NCB among others.
Why destroy seized drugs?
- The hazardous nature of narcotic drugs or psychotropic substances, their vulnerability to theft, substitution, and constraints of proper storage space are among the reasons that make agencies destroy them.
- There have been instances when seized narcotics were pilfered from the storeroom.
- To prevent such instances, authorities try to destroy seized drugs immediately after collecting the required samples out of the seized substances.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: NA
Mains level: Resolving judicial pendency
Over 59 lakh cases were pending in the High Courts until July 22, Law Minister said in a written reply in Rajya Sabha.
What else?
- There are serving women judges in various courts, including 4 in the Supreme Court and 96 in the High Courts, as of July 25.
Indian Judiciary: A Backgrounder
- Our Judicial system has been the nation’s moral conscience keeper.
- It speaks truth to political power, upholds the rights of citizens, mediates between Centre-state conflicts, provides justice to the rich and poor alike, and on several momentous occasions, saved democracy itself.
- Despite its achievements, a gap between the ideal and reality has been becoming clear over the years.
- The justice delivery is slow, the appointment of judges is mired in controversy, disciplinary mechanisms scarcely work, hierarchy rather than merit is preferred, women are severely under-represented, and constitutional matters often languish in the Supreme Court for years.
- As Justice Chelameswar said in his dissent in the NJAC judgment, the courts must reform, so that they can preserve.
Challenges to the judicial system
- Lack of infrastructure of courts
- High vacancy of judges in the district judiciary
- Pendency of Cases
- Ineffective planning in the functioning of the courts
- Delay in the delivery of judgements
- Lack of transparency in appointments and transfers.
- Corruption
- Undertrials serving Jail
- Outdated laws ex. Section 124A IPC
What led to the underperformance of the Indian Judiciary?
The primary factors contributing to docket explosion and arrears as highlighted by the Justice Malimath Committee report are as follows:
- Population explosion
- Litigation explosion
- Hasty and imperfect drafting of legislation
- Plurality and accumulation of appeals (Multiple appeals for the same issue)
- Inadequacy of judge strength
- Failure to provide adequate forums of appeal against quasi-judicial orders
- Lack of priority for disposal of old cases (due to the improper constitution of benches)
Recent developments:
Proposal for the creation of National Judicial Infrastructure Corporation (NJIC)
- The CJI has pitched to set up a National Judicial Infrastructure Corporation (NJIC) to develop judicial infrastructure in trial courts.
- He indicated a substantial gap in infrastructure and availability of basic amenities in the lower judiciary.
- There is a dearth of court halls, residential accommodation, and waiting rooms for litigants in trial courts, especially in smaller towns and rural areas.
- Experience shows that budgetary allocation for state judiciary often lapses since there is no independent body to supervise and execute such works.
- NJIC is expected to fill this vacuum and overcome problems related to infrastructure.
Way forward
- Creating NJIC: It will bring a revolutionary change in the judicial functioning provided the proposed body is given financial and executive powers to operate independently of the Union and the State governments.
- Appointment reforms: There are many experts who advocate the need to appoint more judges with unquestionable transparency in such appointments.
- Creating All Indian Judiciary Services: It would be a landmark move to create a pan-India Service that would result in a wide pool of qualified and committed judges entering the system.
- Technology infusion: The ethical and responsible use of AI and ML for the advancement of efficiency-enhancing can be increasingly embedded in legal and judicial processes. Ex. SUPACE.
- Legal education: This should be in alignment with the evolving dynamics of the law and must be propagated in trial and constitutional courts. This will improve the competence of the judicial system.
- Alternate Dispute Resolution (ADR): ADR mechanisms should be promoted for out-of-court settlements. Primary courts of appeal should be set up.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: NA
Mains level: Issues with IAF, Defense modernization
In a tragic accident, a MIG-21 trainer jet of the Indian Air Force (IAF) crashed in Rajasthan killing both the high-ranked officer pilots onboard.
What is the status of the MIG-21 jets in the IAF?
- The MIG-21 was inducted into the IAF in the early 1960s and since then more than 800 variants of the supersonic fighter were inducted into service.
- It remained the frontline fighter jet of the force for a long time.
- During this period, there were over 400 accidents involving the jet which claimed the lives of around 200 pilots.
Nature of service
- Currently, there are four MIG-21 squadrons in service consisting of the upgraded Bison variant.
- IAF officials have stated that there is technical life still left in them.
- There are only four squadrons of the MIG-21 aircraft.
Why use outdated aircraft?
- With delays in new inductions, the IAF has been forced to continue the last four MIG-21 Bison squadrons in service.
- One squadron is set to be phased out in the next few months, while the remaining three squadrons are planned to be phased out in the next three years.
- This phase-out was worked out much before last week’s tragic incident.
What is the present fighter strength of the IAF?
- The IAF has an authorized strength of 42 fighter squadrons.
- As time passes, the drawdown is increasing as the total technical life is completed.
- However, the rate of new inductions is not matching the drawdown, depleting the overall number of fighter squadrons.
- Additionally, several frontline aircraft in the inventory including the Jaguars, and MIG-29s will begin phasing out by the end of the decade.
- For instance, by 2027-28 the first of the MIG-29s, inducted in the late 1980s, will start going out.
New squadrons to be inducted
- In the last few years, the IAF has inducted two squadrons of the indigenous Light Combat Aircraft (LCA) Tejas and two squadrons of Rafale fighter jets procured from France which pushed the squadron strength to 32.
- In January 2021, the IAF had signed a contract with Hindustan Aeronautics Limited (HAL) for 83 of the more advanced LCA MK-1A which it will start receiving from early 2024 onwards.
- Along with that the to-be-acquired 114 Multi-Role Fighter Aircraft (MRFA) will help arrest the drawdown.
- A larger and even more capable LCA-MK2, as well as the fifth generation Advanced Medium Combat Aircraft (AMCA), are under development.
- However, their availability in enough numbers will take some time.
Inherent limitations to the IAF
- Hardware/Technological Challenges: Technology is at the core of an air force – acquiring and assimilating it is our primary challenge. The lack of it curtails national options, impacting postures and doctrines. Denial and selective availability of technology are all enmeshed in international relations.
- Maintenance Challenges: Maintenance challenges determine how long aircrafts last and their cost-effectiveness. ‘Maintainability’, which includes logistical issues, is therefore, crucial.
- Relying on Upgrades: IAF is badly in need of new Fighter Aircraft to compete with new 5th generation Modern jets. At current there are old aircraft and it is mostly dependant on Super Manoeuvrable Modern Generation Fighter Jet Su 30 MKI.
- Delaying of Aircraft Delivery: The current order of IAF the Rafale is expected to be completed in 2024. The LCA Tejas of HAL has now produced 21 but still it has to manufacture in more number to replace the retiring MIG 21 BISON.
Roadmap to shore up fighter strength
- No easy roadmap: The IAF has acknowledged that they will not be able to achieve the desired strength for the time being and that they are doing the best they can.
- Indigenous aircraft: In addition to the indigenous aircraft coming up, the IAF is confident that increasing the low availability rates of Su-30 and other fighters in service will offset some of the shortfalls in the interim.
- Offsets of war: This could be potentially impacted due to the war in Ukraine even though officials have said that they are assessing the impact of the war and western sanctions.
Way forward
- Air power is becoming technologically more refined with unmanned platforms, cyber-space linkages and AI advances.
- The inherent trans-border nature of this military capability needs astute professional and political husbanding.
- Acquiring credible aerospace power with a meaningful degree of indigenization will need a greater degree of national resolve, professional integrity and resource allocation than is the case now.
- China has demonstrated the degree of suasion and intimidation that airpower can bring to bear in relation to Taiwan.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: AlphaFold
Mains level: Not Much
DeepMind, a company based in London and owned by Google, announced that it had predicted the three-dimensional structures of more than 200 million proteins using AlphaFold.
This is the entire protein universe known to scientists today.
What is AlphaFold?
- AlphaFold is an AI-based protein structure prediction tool.
- It is based on a computer system called deep neural network.
- Inspired by the human brain, neural networks use a large amount of input data and provide the desired output exactly like how a human brain would.
- The real work is done by the black box between the input and the output layers, called the hidden networks. AlphaFold is fed with protein sequences as input.
- When protein sequences enter through one end, the predicted three-dimensional structures come out through the other.
- It is like a magician pulling a rabbit out of a hat.
How does AlphaFold work?
- It uses processes based on “training, learning, retraining and relearning.”
- The first step uses the available structures of 1,70,000 proteins in the Protein Data Bank (PDB) to train the computer model.
- Then, it uses the results of that training to learn the structural predictions of proteins not in the PDB.
- Once that is done, it uses the high-accuracy predictions from the first step to retrain and relearn to gain higher accuracy of the earlier predictions.
- By using this method, AlphaFold has now predicted the structures of the entire 214 million unique protein sequences deposited in the Universal Protein Resource (UniProt)
What are the implications of this development?
- Proteins are the business ends of biology, meaning proteins carry out all the functions inside a living cell.
- Therefore, knowing protein structure and function is essential to understanding human diseases.
- Scientists predict protein structures using x-ray crystallography, nuclear magnetic resonance spectroscopy, or cryogenic electron microscopy.
- These techniques are not just time-consuming, they often take years and are based mainly on trial-and-error methods.
- The development of AlphaFold changes all of that.
- It is a watershed movement in science and structural biology in particular.
What does this development mean for India?
- Vaccine development: Understanding the accurate structures of COVID-19 virus proteins in days rather than years will accelerate vaccine and drug development against the virus.
- Structural biology: From the seminal contribution of G. N. Ramachandran in understanding protein structures to the present day, India is no stranger to the field and has produced some fine structural biologists.
Back2Basics: Proteins
- Protein is found throughout the body—in muscle, bone, skin, hair, and virtually every other body part or tissue.
- It makes up the enzymes that power many chemical reactions and the hemoglobin that carries oxygen in your blood.
- At least 10,000 different proteins make you what you are and keep you that way.
- Protein is made from twenty-plus basic building blocks called amino acids.
- Because we don’t store amino acids, our bodies make them in two different ways: either from scratch or by modifying others.
- Nine amino acids—histidine, isoleucine, leucine, lysine, methionine, phenylalanine, threonine, tryptophan, and valine—known as the essential amino acids, must come from food.
- Chemically, amino acids are organic compounds made of carbon, hydrogen, nitrogen, oxygen or sulfur.
- There are seven types of proteins: antibodies, contractile proteins, enzymes, hormonal proteins, structural proteins, storage proteins, and transport proteins.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Foreign exchange reserves
Mains level: Paper 3- Depreciation of rupee
Context
The Indian rupee has been in free fall. Some commentators have pointed out that it has fallen less against the US dollar than a lot of other currencies.
Significance of foreign exchange reserves
- Decline by 10 per cent: A large part of the current relative strength of the rupee vis-à-vis other currencies is due to the sale of dollars by the RBI — it has lost more than 10 per cent of its foreign reserves in the space of about nine months.
- Why country needs foreign exchange: A developing economy needs foreign exchange to finance its international transactions for both the current account (goods and services) and capital account (assets) transactions.
- Cost involved: The benefits of this stock are obvious, but there are also costs associated with the holding of these.
- The larger the stock, the more its reassuring value.
- Typically, because of their “liquid” nature, the returns on these are low.
How RBI manages the foreign exchange reserves?
- How country accumulates foreign exchange reserves? A country can accumulate reserves by running current account surpluses that is, keeping its total expenditure below its gross national product, and/or by interventions in the foreign exchange markets.
- India (usually) runs a current account deficit.
- Its reserves are then accumulated solely through “sterilised” interventions.
- When foreign entities want to invest in Indian assets (stocks and debt), the RBI gives them rupees in exchange for foreign exchange.
- Mindful of the fact that this may cause a surge in inflation, the RBI then sells government bonds, sucking out the additional rupees.
- The foreign exchange reserves rise, and are matched by an increase in government bonds outstanding.
How outflow of foreign financial capital affects foreign exchange reserves?
- When capital inflows were taking place, the RBI accumulated foreign exchange and allowed some currency appreciation.
- As long as capital flows were strong, foreign reserves kept piling up and the currency (in real terms) was strong.
- Depreciation of rupee: In recent months, we have witnessed an outflow of foreign financial capital, with reserves falling and the rupee depreciating.
- International capital flows tend to be pro-cyclical, that is, they move with the world economic activity.
- Unlikely to increase export: A depreciation of our currency is unlikely to see our exports rise very much because the world income levels are down.
- Inflation: What this depreciation will cause is imported inflation and bankruptcies.
Analysing the RBI’s role
- Allowed outward remittances: The RBI threw caution to the winds and allowed outward remittances in foreign currency by Indian residents, with almost no questions asked (up to $2,50,000 annually).
- The RBI could have had a much larger supply of foreign exchange had they not generously handed out foreign currency to be frittered away.
- While they have not restricted outward remittances, they are trying to shore up reserves by making FCNR (B) and FRE deposits more attractive.
- It is not in any individual’s interest to bail out the RBI.
- The RBI has also committed to using reserves to ensure an orderly depreciation.
- Futility of RBI’s intervention: If the world financial markets want a depreciated rupee, the RBI’s intervention would not be able to prevent it.
- But in spite of this, the RBI, with its commitment to inflation targeting, would try to prevent a depreciation (because it causes the price of imported goods to rise).
- Possible impact on the poor: Having too open a capital account policy was always fraught with risks.
- When countries are confronted with a crisis, the IMF is asked to provide assistance.
- But assistance from IMF would involve a “structural adjustment”, including cutting back on subsidies for the poor and vulnerable.
Conclusion
We are standing at the edge of a precipice, but, hopefully, the world will pull back in the nick of time. If not, it would be the chronicle of a death foretold.
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Back2Basics: FCNR(B) Account
- An FCNR ( Foreign Currency Non-resident) account is a type of term deposit that NRIs can hold in India in a foreign currency.
- FCNR (A) was introduced in 1975 to encourage NRI deposits.
- The Reserve Bank of India (RBI) guaranteed the exchange rate prevalent at the time of a deposit to eliminate risk to depositors.
- In 1993, the apex bank introduced FCNR (B), without exchange rate guarantee, to replace FCNR (A).
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: National flag
Mains level: Read the attached story
The Centre is set to launch a large-scale campaign to encourage Indians to fly the National Fag at their homes to mark the 75th Independence Day under the Har Ghar Tiranga Campaign.
Also, August 2 marks 146th birth anniversary of Pingali Venkayya, the designer of Pingali Venkayya.
Har Ghar Tiranga
- ‘Har Ghar Tiranga’ is a campaign under the aegis of Azadi Ka Amrit Mahotsav to encourage people to bring the Tiranga home and to hoist it to mark the 75th year of India’s independence.
- The campaign aims to have citizens hoisting our National Flag in their homes between August 13 and 15.
Why such move?
- Our relationship with the flag has always been more formal and institutional than personal.
- Bringing the flag home collectively as a nation in the 75th year of independence thus becomes a symbolic act of personal connection to the Tiranga.
- The idea behind the initiative is to invoke the feeling of patriotism in the hearts of the people and to promote awareness about the National Flag.
Story of our National Flag
- On July 22, 1947, the Constituent Assembly adopted our National Flag.
- The flag that was finally chosen underwent several changes since it was originally designed by Pingali Venkayya in 1923.
- Venkayya was not just the architect of the flag but also a freedom fighter.
- He was known as Jhanda Venkayya as he published a book in 1916 on 30 designs for the Indian flag.
- August 2 marks his 146th birth anniversary and citizens across this country will now know more of his contributions in designing the flag that we have today.
How this was made possible?
- First, the Flag Code was changed to make the flag more accessible and thus give every Indian the unique opportunity to hoist the flag at their homes.
- Subsequently, the government has taken various steps to ensure the supply of flags across the country.
- Flags are now available in all post offices in the country.
- State governments have tied up with various stakeholders for the supply of flags.
- The flag will be available on the government’s e-market marketplace (GEM) portal, on e-commerce portals, and with various self-help groups (SHGs).
What is the Flag Code of India?
- The Flag Code of India is a set of laws, practices and conventions that apply to the display of the national flag of India.
- The Code took effect from 26 January 2002 and superseded the “Flag Code-India” as it existed earlier.
- It permits the unrestricted display of the tricolour, consistent with the honour and dignity of the flag.
The Flag Code of India has been divided into three parts:-
- First Part: General Description of the National Flag.
- Second Part: Display of the National Flag by members of public, private Organisations & educational institutions etc.
- Third Part: Display of National Flag by Union or State Governments and their organisations and agencies.
Disposing of the national flag
- A/c to the Flag Code, such paper flags are not to be discarded or thrown on the ground after the event.
- Such flags are to be disposed of, in private, consistent with the dignity of the flag.
Do you know?: Hoisting the national flag is a fundamental right
- The bench headed by Chief Justice of India V. N. Khare said that under Article 19(1)(a) of the Constitution of India, citizens had the fundamental right to fly the national flag on their premises throughout the year.
- However, it provided that the premises do not undermine the dignity of the national flag.
About Prevention of Insults to National Honour Act
- The law, enacted on December 23, 1971, penalizes the desecration of or insult to Indian national symbols, such as the National Flag, the Constitution, the National Anthem, and the Indian map, as well as contempt of the Constitution of India.
- Section 2 of the Act deals with insults to the Indian National Flag and the Constitution of India.
Do you know?
Article 51 ‘A’ contained in Part IV A i.e. Fundamental Duties asks:
To abide by the constitution and respect its ideals and institutions, the National Flag and the National Anthem in clause (a).
Back2Basics: Story of our National Flag
(1) Public display for the first time
- Arguably the first national flag of India is said to have been hoisted on August 7, 1906, in Kolkata at the Parsee Bagan Square (Green Park).
- It comprised three horizontal stripes of red, yellow and green, with Vande Mataram written in the middle.
- Believed to have been designed by freedom activists Sachindra Prasad Bose and Hemchandra Kanungo, the red stripe on the flag had symbols of the sun and a crescent moon, and the green strip had eight half-open lotuses.
(2) In Germany
- In 1907, Madame Cama and her group of exiled revolutionaries hoisted an Indian flag in Germany in 1907 — this was the first Indian flag to be hoisted in a foreign land.
(3) During the Home Rule Movement
- In 1917, Dr Annie Besant and Lokmanya Tilak adopted a new flag as part of the Home Rule Movement.
- It had five alternate red and four green horizontal stripes, and seven stars in the saptarishi configuration.
- A white crescent and star occupied one top corner, and the other had Union Jack.
(4) Final version by Pingali Venkayya
- The design of the present-day Indian tricolour is largely attributed to Pingali Venkayya, an Indian freedom fighter.
- He reportedly first met Mahatma Gandhi in South Africa during the second Anglo-Boer War (1899-1902), when he was posted there as part of the British Indian Army.
- Years of research went into designing the national flag. In 1916, he even published a book with possible designs of Indian flags.
- At the All India Congress Committee in Bezwada in 1921, Venkayya again met Gandhi and proposed a basic design of the flag, consisting of two red and green bands to symbolise the two major communities, Hindus and Muslims.
(5) During Constituent Assembly
- On July 22, 1947, when members of the Constituent Assembly of India, the first item on the agenda was reportedly a motion by Pandit Nehru, about adopting a national flag for free India.
- It was proposed that “the National Flag of India shall be horizontal tricolour of deep saffron (Kesari), white and dark green in equal proportion.”
- The white band was to have a wheel in navy blue (the charkha being replaced by the chakra), which appears on the abacus of the Sarnath Lion Capital of Ashoka.
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From UPSC perspective, the following things are important :
Prelims level: PMI
Mains level: Not Much
India’s manufacturing sector rebounded in July, with sales and output growing at the fastest pace since November. The PMI quickened last month to 56.4, from June’s 9-month low of 53.9.
Purchasing Managers’ Index (PMI)
- PMI is an indicator of business activity — both in the manufacturing and services sectors.
- It is a survey-based measure that asks the respondents about changes in their perception of some key business variables from the month before.
- It is calculated separately for the manufacturing and services sectors and then a composite index is constructed.
- The PMI is compiled by IHS Markit based on responses to questionnaires sent to purchasing managers in a panel of around 400 manufacturers.
How is the PMI derived?
- The PMI is derived from a series of qualitative questions.
- Executives from a reasonably big sample, running into hundreds of firms, are asked whether key indicators such as output, new orders, business expectations and employment were stronger than the month before and are asked to rate them.
How does one read the PMI?
- A figure above 50 denotes expansion in business activity. Anything below 50 denotes contraction.
- Higher the difference from this mid-point greater the expansion or contraction. The rate of expansion can also be judged by comparing the PMI with that of the previous month data.
- If the figure is higher than the previous month’s then the economy is expanding at a faster rate.
- If it is lower than the previous month then it is growing at a lower rate.
What are its implications for the economy?
- The PMI is usually released at the start of the month, much before most of the official data on industrial output, manufacturing and GDP growth becomes available.
- It is, therefore, considered a good leading indicator of economic activity.
- Economists consider the manufacturing growth measured by the PMI as a good indicator of industrial output, for which official statistics are released later.
- Central banks of many countries also use the index to help make decisions on interest rates.
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From UPSC perspective, the following things are important :
Prelims level: Creation of new districts
Mains level: Distrinct administration
The West Bengal cabinet has approved the creation of seven new districts in the state.
What are Districts?
- India’s districts are local administrative units inherited from the British Raj.
- They generally form the tier of local government immediately below that of India’s subnational states and territories.
- A district is headed by a Deputy Commissioner/ Collector, who is responsible for the overall administration and the maintenance of law and order.
- The district collector may belong to IAS (Indian Administrative Service).
- Districts are most frequently further sub-divided into smaller administrative units, called either tehsils or talukas or mandals, depending on the region.
How are new districts carved?
- The power to create new districts or alter or abolish existing districts rests with the State governments.
- This can either be done through an executive order or by passing a law in the State Assembly.
- Many States prefer the executive route by simply issuing a notification in the official gazette.
How does it help?
- States argue that smaller districts lead to better administration and governance.
- For example, in 2016, the Assam government issued a notification to upgrade the Majuli sub-division to Majuli district for “administrative expediency”.
Does the Central government have a role to play here?
- The Centre has no role to play in the alteration of districts or creation of new ones. States are free to decide.
- The Home Ministry comes into the picture when a State wants to change the name of a district or a railway station.
- The State government’s request is sent to other departments and agencies such as the Ministry of Earth Sciences, Intelligence Bureau, Department of Posts, Geographical Survey of India Sciences and the Railway Ministry seeking clearance.
- A no-objection certificate may be issued after examining their replies.
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From UPSC perspective, the following things are important :
Prelims level: INSTC
Mains level: Paper 2- Significance of INSTC for India
Context
Last week, two 40-ft containers of wood laminate sheets crossed the Caspian Sea from Russia’s Astrakhan port, entered Iran’s Anzali port, continued their southward journey towards the Arabian Sea, entered the waters at Bandar Abbas and eventually reach Nhava Shiva port in Mumbai.
Launch of INSTC
- The journey of containers signalled the launch of the International North South Transport Corridor (INSTC), a 7,200-km multi-modal transport corridor that combines road, rail and maritime routes connecting Russia and India via central Asia and Iran.
- The legal framework for the INSTC is provided by a trilateral agreement signed by India, Iran and Russia at the Euro-Asian Conference on Transport in 2000.
- Since then Kazakhstan, Belarus, Oman, Tajikistan, Azerbaijan, Armenia and Syria have signed instruments of accession to become members of the INSTC.
- Once fully operational, the INSTC is expected to reduce freight costs by 30% and journey time by 40% in comparison with the conventional deep sea route via the Suez Canal.
- The corridor is expected to consolidate the emerging Eurasian Free Trade Area.
Significance for India
- Geopolitical link: The INSTC’s launch provides missing pieces of the puzzle about India’s refusal to condemn Russia’s invasion of Ukraine.
- India’s investment in the INSTC is exemplified by its involvement in Iran’s Chabahar port and the construction of a 500-km Chabahar-Zahedan railway line.
- The India Ports Global Limited, a joint venture between the Jawaharlal Nehru Port Trust and Kandla Port Trust, will develop the port along with Iran’s Aria Banader.
- IRCON International will contribute to constructing the railway line.
- A special economic zone around Chabahar will offer Indian companies the opportunity to set up a range of industries.
- The INSTC, thus, provides an opportunity for the internationalisation of India’s infrastructural state, with state-run businesses taking the lead and paving the way for private companies.
Geopolitical significance for India
- Access to Afghanistan and Central Asia: Once completed, this infrastructure will allow India access to Afghanistan and central Asia, a prospect strengthened by the Taliban government’s support for the project.
- India can now bypass Pakistan to access Afghanistan, central Asia and beyond.
- North-South transport corridor: The INSTC can shape a north-south transport corridor that can complement the east-west axis of the China-led Belt and Road Initiative (BRI).
- Non-alignment to multi-alignment: India’s founding role in both the INSTC and the Quad exemplify its departure from non-alignment to multi-alignment.
- The INSTC offers a platform for India to closely collaborate with Russia, Iran and Central Asian republics.
- That two of its partners are subject to Western sanctions hasn’t prevented India from collaborating with the U.S., Japan and Australia as part of the Quad to create and safeguard a free and open Indo-Pacific.
Conclusion
As a transcontinental multi-modal corridor that aims to bring Eurasia closer together, the INSTC is a laudable initiative in its own right. That it helps India consolidate its multi-alignment strategy sweetens the deal.
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From UPSC perspective, the following things are important :
Prelims level: Uniform Civil Code
Mains level: UCC debate
A parliamentary panel has reviewed Goa’s uniform civil code, and some of its members feel that there are some peculiar and outdated provisions related to matrimony in it.
What is Goa Civil Code?
- The Goa Civil Code is a set of civil laws that governs all residents of the coastal State irrespective of their religion and ethnicity.
- Citing various positives of the Goa Civil Code, Goa CM had urged that it could be a model for implementing the UCC across the country.
Why in news?
- GCC has come under focus amid a call for the implementation of a Uniform Civil Code (UCC) across the country.
- The UCC features prominently on the present regime’s ideological agenda, and the party had made promises on it in the run-up to the Lok Sabha elections in 2014 and 2019.
- This had an intimidating impact on certain sections of the population whose archaic provisions of personal laws were untouched for the sake of appeasement.
Why Goa model is in news?
- It was observed that a majority of the State’s people are “quite happy and content with it”.
- It is a living example of peaceful implementation of UCC.
- There were, however, some peculiar clauses in the law related to matrimony and division of property, which were outdated and not based on the principle of equality.
What is a Uniform Civil Code?
- A Uniform Civil Code (UCC) is one that would provide for one personal civil law for the entire country.
- This would be applicable to all religious communities in their personal matters such as marriage, divorce, inheritance, adoption etc.
Basis for UCC
- Article 44, one of the Directive Principles of the Constitution lays down that the state shall endeavour to secure a UCC for the citizens throughout the territory of India.
- These, as defined in Article 37, are not justiciable (not enforceable by any court) but the principles laid down therein are fundamental in governance.
UCC vs. Right to Freedom of Religion
- Article 25 lays down an individual’s fundamental right to religion
- Article 26(b) upholds the right of each religious denomination or any section thereof to “manage its own affairs in matters of religion”
- Article 29 defines the right to conserve distinctive culture
Reasonable restrictions on the Freedom of Religion
- An individual’s freedom of religion under Article 25 is subject to “public order, health, morality” and other provisions relating to FRs, but a group’s freedom under Article 26 has not been subjected to other FRs.
- In the Constituent Assembly, there was division on the issue of putting UCC in the fundamental rights chapter. The matter was settled by a vote.
- By a 5:4 majority, the fundamental rights sub-committee headed by Sardar Patel held that the provision was outside the scope of FRs and therefore the UCC was made less important.
Minority Opinion in the Constituent Assembly
- Some members sought to immunize Muslim Personal Law from state regulation.
- Mohammed Ismail, who thrice tried unsuccessfully to get Muslim Personal Law exempted from Article 44, said a secular state should not interfere with the personal law of people.
- B Pocker Saheb said he had received representations against a common civil code from various organizations, including Hindu organizations.
- Hussain Imam questioned whether there could ever be uniformity of personal laws in a diverse country like India.
- B R Ambedkar said “no government can use its provisions in a way that would force the Muslims to revolt”.
- Alladi Krishnaswami, who was in favour of a UCC, conceded that it would be unwise to enact UCC ignoring strong opposition from any community.
- Gender justice was never discussed in these debates.
What about Personal Laws?
- Citizens belonging to different religions and denominations follow different property and matrimonial laws which are an affront to the nation’s unity.
- If the framers of the Constitution had intended to have a UCC, they would have given exclusive jurisdiction to Parliament in respect of personal laws, by including this subject in the Union List.
- “Personal Laws” are mentioned in the Concurrent List.
Various customary laws
- All Hindus of the country are not governed by one law, nor are all Muslims or all Christians.
- Muslims of Kashmir were governed by a customary law, which in many ways was at variance with Muslim Personal Law in the rest of the country and was, in fact, closer to Hindu law.
- Even on registration of marriage among Muslims, laws differ from place to place.
- In the Northeast, there are more than 200 tribes with their own varied customary laws.
- The Constitution itself protects local customs in Nagaland. Similar protections are enjoyed by Meghalaya and Mizoram.
- Even reformed Hindu law, in spite of codification, protects customary practices.
Why need UCC?
- UCC would provide equal status to all citizens
- It would promote gender parity in Indian society.
- UCC would accommodate the aspirations of the young population who imbibe liberal ideology.
- Its implementation would thus support the national integration.
Hurdles to UCC implementation
- There are practical difficulties due to religious and cultural diversity in India.
- The UCC is often perceived by the minorities as an encroachment of religious freedom.
- It is often regarded as interference of the state in personal matters of the minorities.
- Experts often argue that the time is not ripe for Indian society to embrace such UCC.
These questions need to be addressed which are being completely ignored in the present din around UCC.
- Firstly, how can uniformity in personal laws are brought without disturbing the distinct essence of each and every component of the society.
- Secondly, what makes us believe that practices of one community are backward and unjust?
- Thirdly, has other uniformities been able to eradicate inequalities which diminish the status of our society as a whole?
Way forward
- It should be the duty of the religious intelligentia to educate the community about its rights and obligations based on modern liberal interpretations.
- A good environment for the UCC must be prepared by the government by explaining the contents and significance of Article 44 taking all into confidence.
- Social reforms are not overnight but gradual phenomenon. They are often vulnerable to media evils such as fake news and disinformation.
- Social harmony and cultural fabric of our nation must be the priority.
Also read this comprehensive article:
[Sansad TV] Perspective: Uniform Civil Code
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From UPSC perspective, the following things are important :
Prelims level: EPR, PRO
Mains level: E-waste management
A proposed framework by the Centre for regulating e-waste in India has upset a key link of India’s electronic waste collection system and threatens the livelihood of thousands of people.
Menace of E-Waste in India
- Electronic waste, or electronic goods that are past their productive life and old parts, is largely handled by India’s vast informal sector.
- Spent goods are dismantled and viable working parts refurbished, with the rest making their way into chemical dismantling units.
- Many of these units are run out of unregulated sweatshops that employ child labour and hazardous extraction techniques.
Remedy against this: Extended Producer Responsibility (EPR)
- To address all of this, the Environment Ministry brought the E-waste (Management) Rules, 2016.
- This introduced a system of Extended Producer Responsibility (EPR) compelling makers of electronic goods to ensure a proportion of the goods they sold every year was recycled.
- They are expected to maintain records annually demonstrating this.
- Most companies however did not maintain an in-house unit in charge of recycling and this gave rise to a network of government-registered companies, called Producer Responsibility Organisations (PRO).
How PROs work?
- PROs act as an intermediary between manufacturers and formal recycling
- They are (expected to be) technologically equipped to recycle end-of-life electronic goods safely and efficiently.
- The PROs typically bid for contracts from companies and arrange for specified quantities of goods to be recycled.
- They provide companies certified proof of recycling that they then maintain as part of their records. Several PROs work on consumer awareness and enable a supply chain for recycled goods.
Functional PROs in India
- As of March 2022, the Central Pollution Control Board (CPCB) has registered 74 PROs and 468 authorised dismantlers.
- They have a collective recycling capacity of about 1.3 million tonnes.
What is the extent of E-Waste production in India?
- The Ministry estimated 7.7 lakh tonnes of e-waste to have been generated in 2018-19.
- Around one million tonnes in 2019-20 of which only a fifth (about 22% in both years) has been confirmed to be “dismantled and recycled”.
What is the controversy now?
- This May, the Ministry issued a draft notification that does away with the PROs and dismantlers and vests all responsibility of recycling with authorised recyclers.
- Only a handful of authorised recyclers exist in India.
- Recyclers will source a quantity of waste, recycle them and generate electronic certificates.
- Companies can buy these certificates equivalent to their annual committed target and thus do not have to be involved with engaging the PROs and dismantlers.
- Dismantling a fledgling system was detrimental to the future of e-waste management in India.
What is the rationale behind?
- The Centre has not explained its rationale for dismantling the existing system in its draft notification.
- However, a final policy is yet to emerge.
- The new rules would track the material that went in for recycling with the output claimed by a recycler when they claimed GST (Goods and Services Tax) input credit.
Also read this comprehensive article:
[Yojana Archive] E-waste Management
Try this PYQ:
Q.In India, ‘extended producer responsibility’ was introduced as an important feature in which of the following?
(a) The Bio-medical Waste (Management and Handling) Rules, 1998
(b) The Recycled Plastic (Manufacturing and Usage) Rules, 1999
(c) The e-Waste (Management and Handling) Rules, 2011
(d) The Food Safety and Standard Regulations, 2011
Post your answers here.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Read the attached story
Mains level: Govt advertisement and related issues
The Madras High Court has directed the Tamil Nadu government to include the photographs of the President of India and Prime Minister in advertisements on the 44th Chess Olympiad underway in Chennai.
Why in news?
- The HC relied on a 2015 Supreme Court ruling that issued guidelines on government spending on advertisements.
How can we classify Govt Ads with other political ads?
The primary cause of government advertisement is to use public funds:
- To inform the public of their rights, obligations, and entitlements
- To explain Government policies, programs, services and initiatives.
2015 Supreme Court’s Ruling
- In Common Cause v Union of India, the Supreme Court sought to regulate the government expenditure on advertisements.
- It essentially regulated the 2007 New Advertisement Policy of the Government of India.
- The petitioners had argued that there is arbitrary spending on advertisements by the government.
- The allegations ranged from wastage of public money for political mileage to using advertisements as a tool to manipulate media.
- A three-judge Bench comprising then CJI P Sathasivam, and Justices Ranjan Gogoi and N V Ramana had set up a committee to suggest a better policy.
What are the guidelines?
- No endorsement: Patronization of any particular media house must be avoided and award of advertisements must be on an equal basis to all newspapers who may, however, be categorized depending upon their circulation.
- The Government Advertisements (Content Regulation) Guidelines 2014 have five broad principles:
- Advertising campaigns are to be related to government responsibilities
- Materials should be presented in an objective, fair manner and designed to meet objectives of the campaign
- Advertisements must not directed at promoting political interests of a party
- Campaigns must be justified and undertaken in a cost-effective manner
- Advertisements must comply with legal requirements and financial regulations
What did the Supreme Court rule?
- It largely accepted the committee report except on a few issues:
- The appointment of an ombudsman to oversee the implementation of the guidelines
- A special performance audit of government spending
- An embargo on publication of advertisements on the eve of elections
- The ruling mandated that government advertisements will not contain a political party’s symbol, logo or flag.
- They are required to be politically neutral and must refrain from glorifying political personalities.
What about photographs in advertisements?
- The Supreme Court agreed with the committee’s suggestion that photographs of leaders should be avoided and only the photographs of the President/ PM or Governor/ CM shall be used for effective government messaging.
- Then-Attorney General had opposed the recommendation arguing that if the PM’s photograph is allowed in the advertisement, then the same right should be available to his cabinet colleagues as the PM is the “first among the equals”.
- The court, while restricting the recommendation to the photos of the President and Prime Minister, added the photograph of the Chief Justice of India to that list of exceptions.
What are the takeaways from the SC and HC verdicts?
- The SC ruling stepped into content regulation, which is a facet of the right to freedom of speech and expression, and was also in the domain of making policy.
- This raised questions on the judiciary stepping on the executive’s domain.
- The SC ruling did not mandate publication of the photograph of the PM and President, but only restricts publication of photos of government officials other than the President, PM, CJI, CM and the Governor.
- In an opposition-ruled state such as Tamil Nadu, exclusion of the PM’s photos is seen as a political move.
- The HC said that considering the “national interest” in the issue, the “excuses taken by the state” cannot be accepted.
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From UPSC perspective, the following things are important :
Prelims level: Space Junk
Mains level: Read the attached story
A Chinese booster rocket made an uncontrolled return to earth, leading to US furore against Beijing for not sharing information about the potentially hazardous object’s descent.
Yet another Chinese irresponsibility
- Ending over a week of global anxiety and alarm, the debris from a large Chinese rocket – the Long March 5B — crashed to earth over the Pacific and the Indian oceans.
- It felt into the Sulu Sea near Malaysia.
- The 22-tonne core stage of the rocket hurtled uncontrollably back to earth. There were fears that it might hit a populated area.
- China, however, had dismissed these fears despite widespread criticism for rocket re-entry risks imposed by it on the world.
What is an Uncontrolled Re-entry?
- Generally, the core or first stage of a rocket is made up of heavy pieces that usually don’t reach orbit after liftoff, and fall back safely along a near-precise projected trajectory.
- If they do enter an orbit, then a costly de-orbit manoeuvre is required for a steered, controlled return using engine burn.
- Without a de-orbit manoeuvre, the orbital core stage makes an uncontrolled fall.
Why did it fell back?
- Gigantic remnants from China’s Long March 5B rockets’ core stage are known to make such fiery, out-of-control descents back to earth.
- Most nations’ rockets, separate the launcher from the payload before leaving the atmosphere.
- An extra engine then gives the payload a final boost.
- But China’s 5B series does NOT use a second engine and pushes right into orbit, the report points out.
Why is it difficult to track uncontrolled descents?
- The variables involved make it difficult to precisely track the re-entry time and drop zone of rocket debris in uncontrolled descents.
- The factors that make this prediction extremely challenging include atmospheric drag, variations in solar activity, angle and rotational variation of the object among others.
- A miscalculation of even a minute in re-entry time could result in the final resting place of the debris changing by hundreds of kilometres.
- It’s important to understand that among the 10 tough things that we do in space, debris re-entry is probably one of the toughest ones to predict.
Are there laws regulating space junk?
Yes. The Space Liability Convention of 1972.
- It defines responsibility in case a space object causes harm.
- The treaty says that a launching State shall be absolutely liable to pay compensation for damage caused by its space objects on the surface of the earth or to aircraft, and liable for damage due to its faults in space.
- The Convention also provides for procedures for the settlement of claims for damages.
- However, there is no law against space junk crashing back to earth.
- In April this year, suspected debris from a Chinese rocket was found in two Maharashtra villages.
Cases of settlements
- In 1979, the re-entry of NASA’s 76-ton Skylab had scattered debris over uninhabited parts of Australia, and the space agency was fined $400 for littering by a local government.
- The only settlement using the Liability Convention was between the erstwhile Soviet Union and Canada over the debris of Soviet Cosmos 954 falling in a barren region.
- Canada was paid CAD 3 million in accordance with international law for cleaning up the mess.
Do you know?
The 1979 Skylab was rumoured to be falling in India. We may ask our parents who were apparently kids at that time. The event was widely perceived as a Pralay (doomsday) in rural India back then! People were in all joy with festive food/partying every day fearing so that they would never see the next dawn!!
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From UPSC perspective, the following things are important :
Prelims level: Exercise AL NAJAH-IV
Mains level: Read the attached story
India and Oman will carry out a 13-day military exercise with a focus on counter-terror cooperation.
Exercise AL NAJAH-IV
- This is the fourth edition of India-Oman joint military exercise ‘AL NAJAH-IV’.
- It is held between contingents of Indian Army and the Royal Army of Oman is scheduled to take place at the Foreign Training Node of Mahajan Field Firing Ranges.
- The previous edition of the exercise was organised in Muscat in March 2019.
- The scope of the exercise includes “professional interaction, mutual understanding of drills and procedures, the establishment of joint command and control structures and elimination of terrorist threats”.
India-Oman Relations: A Backgrounder
- The Sultanate of Oman is a strategic partner of India in the Gulf.
- Both nations are linked by geography, history and culture and enjoy warm and cordial relations.
- An Indian consulate was opened in Muscat in February 1955 which was upgraded to a consulate general in 1960 and later into a full-fledged embassy in 1971.
- The first ambassador of India arrived in Muscat in 1973.
History of the ties
- Oman, for many years, was ruled by Sultan Qaboos bin Said al Said, who was a friend of India.
- Sultan Qaboos, the longest-reigning leader of the modern Arab world, died in January ‘2020 at the age of 79.
- He was a man who was, as a student, taught by Shankar Dayal Sharma who went on to become the President of India.
- Sultan Qaboos’s father, an alumnus of Ajmer’s Mayo College, sent his son to study in Pune for some time, where he was former President Shankar Dayal Sharma’s student.
Economic ties
- Expatriate community: Oman has over five hundred thousand Indian nationals living there making them the largest expatriate community in Oman. They annually remit $780 million to India.
- Bilateral trade: In 2010, bilateral trade between India and Oman stood at $4.5 billion. India was Oman’s second-largest destination for its non-oil exports and its fourth-largest source for Indian imports.
- Energy: India has been considering the construction of a 1,100-km-long underwater natural gas pipeline from Oman called the South Asia Gas Enterprise (SAGE).
Defense cooperation
Oman is the first Gulf nation to have formalized defense relations with India.
- Naval cooperation: The Indian Navy has berthing rights in Oman, and has been utilizing Oman’s ports as bases for conducting anti-piracy operations in the Gulf of Aden.
- Tri-services base: In February 2018, India announced that it had secured access to the facilities at Duqm for the Indian Air Force and the Indian Navy. Duqm had previously served as a port for the INS Mumbai.
- Arms trade: The standard issue rifle of the Royal Army of Oman is India’s INSAS rifle.
- Bilateral exercises: Naseem al-Bahr (Arabic for Sea Breeze) is a bilateral maritime exercise between India and Oman. The exercise was first held in 1993.
Significance of Oman for India
- Oman is India’s closest defense partner in the Gulf region and an important anchor for India’s defense and strategic interests.
- It is the only country in the Gulf region with which all three services of the Indian armed forces conduct regular bilateral exercises and staff talks, enabling close cooperation and trust at the professional level.
- It also provides critical operational support to Indian naval deployments in the Arabian sea for anti-piracy missions.
Duqm port and its strategic imperative
- In a strategic move to expand its footprint in the Indian Ocean region, India has secured access to the key Port of Duqm in Oman for military use and logistical support.
- This is part of India’s maritime strategy to counter Chinese influence and activities in the region.
- The Port of Duqm is strategically located, in close proximity to the Chabahar port in Iran.
- With the Assumption Island being developed in Seychelles and Agalega in Mauritius, Duqm fits into India’s proactive maritime security roadmap.
- In recent years, India had deployed an attack submarine to this port in the western Arabian Sea.
Deterrent in ties: Chinese influence in Oman
- China started cultivating ties with the Arab countries following the former Soviet Union’s invasion of Afghanistan.
- Beijing has cultivated close ties with Oman and the latter was, in fact, the first country to deliver oil to China.
- As of today, 92.99 per cent of Oman’s oil exports go to China, making China Oman’s largest oil importer.
- Oman and China signed an agreement to establish an Oman-China Industrial Park at Duqm in 2016.
- China has identified Oman as a key country in the region and has been enhancing defence ties with it steadily.
Way forward
- India does not have enough energy resources to serve its current or future energy requirements. The rapidly growing energy demand has contributed to the need for long term energy partnerships with countries like Oman.
- Oman’s Duqm Port is situated in the middle of international shipping lanes connecting East with West Asia.
- India needs to engage with Oman and take initiatives to utilise opportunities arising out of the Duqm Port industrial city.
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From UPSC perspective, the following things are important :
Prelims level: India's coal import
Mains level: Paper 3- Issues with India's power sector
Context
Across several states, the fiscal situation is becoming increasingly challenging. Yet, the common thread that runs through these deficits — state ownership and control — remains unaddressed.
State ownership: structural cause of India’s deficit
- Coal India’s inability to raise production to meet growing demand contributed to the recent power crisis.
- The state-owned power distribution companies have failed to bring down losses despite many schemes and packages.
- The state control of these critical aspects of India’s power chain is central to a higher current account deficit and growing fiscal risks at the state level.
Coal output fails to meet the demand
- From 2013-14, the Indian economy has grown by around 50 per cent (in real terms).
- But Coal India, which accounts for around 80 per cent of India’s total coal production, was able to raise its output by just 34 per cent over the same period.
- Increased reliance on imported coal: India’s coal imports (thermal and cooking) rose to a staggering 230.3 million tonnes in 2020-21, up 37 per cent from 168.5 million tonnes in 2013-14.
- Coal imports for thermal power alone have more than doubled in the first quarter, compared to the same period last year.
- To put this in perspective — the value of coal imports in just the first three months of this year is likely to be around half of what was imported in all of last year.
- Increase in current account deficit: This growing reliance on coal imports (along with crude and gold) is at the root of the country’s widening current account deficit.
- An inability to ramp up production, to forecast demand accurately, as every episode of coal shortage over the years has exposed, is the hallmark of the coal sector that is still largely the preserve of a public sector monopoly.
Problem of DISCOMS
- No improvement in financial and operational issues: Despite repeated attempts to turn around their financial and operational positions, on key metrics, the divide between the public and private sector discoms is deepening.
- In 2019-20, public sector discoms lost Rs 0.72 per unit of power sold, while private discoms made Rs 0.20 per unit.
- High AT&C losses: Similarly, in 2019-20, the AT&C losses (due to operational inefficiencies) for state discoms were pegged at 21.7 per cent, while for the private sector, losses were at 8 per cent.
- With deteriorating finances, the net worth of all public sector discoms put together stands at a negative Rs 61,757 crore, while for the private sector, it is a positive Rs 24,965 crore.
- There have been several attempts to rescue state discoms.
- In the early 2000s, the scheme for repayment of SEB dues amounted to Rs 41,473 crore.
- In 2012, the financial restructuring plan added up to Rs 1.19 lakh crore.
- In 2015, UDAY involved a transfer of Rs 2.01 lakh crore to state government balance sheets.
- Notwithstanding various schemes to turn around their finances, the total debt of all discoms put together stood at Rs 5.14 lakh crore at the end of 2019-20.
- Of this, Rs 4.87 lakh crore is owed by state discoms.
- Impact on entire power chain: A deterioration in the financial position of discoms means that their dues to power generating companies start mounting, which in turn delay payments to coal miners, affecting the financial stability of the entire power chain.
Declining cross-subsidisation
- As tariffs charged by discoms are much higher than the cost of alternatives, a sizeable part of non-agricultural sales of discoms (industrial and commercial consumers) have already shifted towards captive and solar.
- And with the ministry of power recently reducing the threshold for green energy open access, more and more consumers will increasingly opt out.
- This would mean that discom losses will rise as cross subsidisation from commercial and industrial consumers will decline, increasing their dependence on state subsidies.
- In 2019-20, the total state subsidy claimed and released was around Rs 1.1 lakh crore or 17 per cent of total discom revenue.
- This will only increase down the line, making future bailouts even more fiscally challenging.
Conclusion
Tackling these deficits requires addressing the issue of government control over critical aspects of India’s energy sector. Without shifting to market-determined prices — reforms are ultimately about price — little headway is likely to be made.
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From UPSC perspective, the following things are important :
Prelims level: IIBX
Mains level: Gold exchange
Prime Minister has launched India’s first International Bullion Exchange (IIBX) at the Gujarat International Finance Tec-City (GIFT City) near Gandhinagar.
What is Bullion?
- Bullion refers to physical gold and silver of high purity that is often kept in the form of bars, ingots, or coins.
- It can sometimes be considered legal tender and is often held as reserves by central banks or held by institutional investors.
When was the IIBX announced?
- During her 2020 budget speech, Finance Minister announced the setting up of India International Bullion Exchange (IIBX) at International Financial Services Center (IFSC) at GIFT City in Gandhinagar.
- The International Financial Services Centres Authority (Bullion Exchange) Regulations, 2020, was notified in December 2020 for trading of precious metals, including gold and silver.
- These regulations also cover bullion exchange, clearing corporation, depository and vaults.
What is the IIBX?
- India for the first time had liberalised gold imports through nominated banks and agencies in the 1990s.
- Now, the eligible qualified jewellers in India have been allowed to directly import gold through IIBX.
- For this, jewellers will have to become a trading partner or a client of an existing trading member.
- In addition, the exchange has set up necessary infrastructure to store physical gold and silver.
- The exchange will sell physical gold and silver and aims to be set up on the lines of the Shanghai Gold Exchange and Borsa Istanbul in order to make India a key regional hub for bullion flows.
How will it work?
- The thought process behind setting this up is to enable the trading of commodities on an exchange.
- Since this is international exchange, trading can take place in US dollars as well.
- India has positioned itself as one of the biggest trading hubs in Asia.
- Because of the competitive pricing on IIBX, international players will be happy to use our vaulting services.
- Moreover, with this being a free trade zone, no duty will be paid.
What was the practice up until now?
- Currently, gold in India is imported on a consignment model into different cities by nominated banks and agencies approved by the RBI and then supplied to traders/jewellers.
- The banks and other agencies get a fee from the gold exporter for handling, storage, etc, and also add a premium to the gold while transacting with domestic buyers.
- The buyer passes this charge on to the value chain until it reaches the end customer.
What change did IIBX bring?
- With the IIBX becoming operational today, qualified domestic buyers can, through a branch in Gift City, purchase the bars and coins.
- This purchase can be done from an international supplier who is a member of the IIBX.
What is the advantage of an exchange?
- Through the dis-intermediation by facilitating transactions through an anonymously traded exchange platform, bullion is made available across special economic zones (SEZs) at International Financial Services Centres Authority (IFSCA)-approved vaults.
- This means the growth of IIBX is not just limited to GIFT City but across jewellery manufacturing hubs nationwide.
- The qualified jeweller allowed to import gold through IIBX, or a jeweller who is a client of an IIBX member, can view the available stock and place the order.
- This shall nudge jewellers towards just-in-time inventory management.
- It will also result in greater transparency in pricing, and order sequencing, thereby removing any room for unfair preference by supplier, importing or logistics agency.
Which jewellers have come on board?
- So far, 64 big jewellers have come onboard and more applications are in the pipelines.
- Some of the big names include Malabar Gold Pvt Ltd, Titan Company Ltd, Bangalore Refinery Pvt Ltd, RBZ Jewellers Pvt Ltd, Zaveri and Company Pvt Ltd.
What are the new RBI guidelines for importing gold?
- Banks may now allow qualified Jewellers to remit advance payments for 11 days for import of gold through IIBX in compliance to the extant Foreign Trade Policy and regulations issued under IFSC Act.
- According to the RBI, all payments by qualified jewellers for imports of gold through IIBX shall be made through the exchange mechanism as approved by IFSCA.
Who can enrol on the exchange?
- Non-Resident Individual / Proprietorship Firm
- Registered Partnership Firm
- Private Limited Company
- Public Limited Company
- Qualified Jewellers
- Branches of IBU at GIFT City
- Foreign Bullion Suppliers who follow OECD guideline
- In order to become a qualified jeweller, entities require a minimum net worth of Rs 25 crore.
- And 90 per cent of the average annual turnover in the last three financial years through deals in goods categorised as precious metals.
- NRIs and institutes will also be eligible to participate in the exchange after registering with the International Financial Services Centre Association (IFSCA).
- Jewellers will be able to transact on IIBX only as trading members or as clients of a trading member.
- If one wants to become a trader, a qualified jeweller will have to establish a branch or a subsidiary in IFSC (international financial services centre) and apply to the IFSCA.
What products does IIBX offer?
- IIBX offers a diversified portfolio of products and technology services at a cost which is far more competitive than the Indian exchanges as well as other global exchanges in Hong Kong Singapore, Dubai, London and New York.
- Gold 1 kg 995 purity and gold 100 gm 999 purity with a T+0 settlement (100% upfront margin) are expected to trade at IIBX initially.
- All contracts will be listed, traded and settled in US Dollar
- The exchange will have three vaults – one operated by Sequel Global (ready and approved), the second one to be operated by Brinks India is ready and awaiting final approval and the third is under construction.
- Once the gold is imported by the authorised entities it will be deposited at one of the vaults which will issue bullion depository receipts.
- These receipts will then be traded in dollars on the exchange.
Significance of IIBX
- The IIBX shall be the “Gateway for Bullion Imports into India”, wherein all the bullion imports for domestic consumption shall be channelized through the exchange.
- The exchange ecosystem is expected to bring all the market participants to a common transparent platform for bullion trading.
- It would provide efficient price discovery, assurance in the quality of gold, and enable greater integration with other segments of financial markets.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Core Industries
Mains level: Read the attached story
India’s eight core sectors’ output growth moderated to 12.7% in June, from 18.1% in May, with all sectors except crude oil registering an uptick in production.
What are the Core Industries in India?
- The main or the key industries constitute the core sectors of an economy.
- In India, there are eight sectors that are considered the core sectors.
- They are electricity, steel, refinery products, crude oil, coal, cement, natural gas and fertilizers.
Index of Eight Core Industries (ICI) vs Index of Industrial Production (IIP)
[A] Index of Eight Core Industries
- The monthly Index of Eight Core Industries (ICI) is a production volume index.
- ICI measures collective and individual performance of production in selected eight core industries viz. Coal, Crude Oil, Natural Gas, Refinery Products, Fertilizers, Steel, Cement and Electricity.
- Prior to the 2004-05 series six core industries namely Coal, Cement, Finished Steel, Electricity, Crude petroleum and Refinery products constituted the index basket.
- Two more industries i.e. Fertilizer and Natural Gas were added to the index basket in 2004-05 series. The ICI series with base 2011-12 will continue to have eight core industries.
Components covered in these eight industries for the purpose of compilation of index are as follows:
- Coal – Coal Production excluding Coking coal.
- Crude Oil – Total Crude Oil Production.
- Natural Gas – Total Natural Gas Production.
- Refinery Products – Total Refinery Production (in terms of Crude Throughput).
- Fertilizer – Urea, Ammonium Sulphate (A/S), Calcium Ammonium Nitrate (CAN), Ammonium chloride (A/C), Diammonium Phosphate (DAP), Complex Grade Fertilizer and Single superphosphate (SSP).
- Steel – Production of Alloy and Non-Alloy Steel only.
- Cement – Production of Large Plants and Mini Plants.
- Electricity – Actual Electricity Generation of Thermal, Nuclear, Hydro, imports from Bhutan.
[B] Index of Industrial Production
- The Index of Industrial Production (IIP) is an index for India which details out the growth of various sectors in an economy such as mineral mining, electricity and manufacturing.
- The all India IIP is a composite indicator that measures the short-term changes in the volume of production of a basket of industrial products during a given period with respect to that in a chosen base period.
Difference between the two
- IIP is compiled and published monthly by the National Statistics Office (NSO), Ministry of Statistics and Programme Implementation six weeks after the reference month ends.
- However, ICI is compiled and released by Office of the Economic Adviser (OEA), Department of Industrial Policy & Promotion (DIPP), and Ministry of Commerce & Industry.
- The Eight Core Industries comprise nearly 40.27% of the weight of items included in the Index of Industrial Production (IIP).
- These are Electricity, steel, refinery products, crude oil, coal, cement, natural gas and fertilisers.
Importance of Core Industries
- The core sectors have a major impact on the Indian economy and significantly affect most other industries as well.
- Their measures help account for the physical volume of production in India.
- Their analysis offers a clearer and more realistic assessment of what’s happening in the economy
- Their progress is used by government agencies for policy-making purposes.
- They remain extremely relevant for the calculation of the quarterly and advanced Gross Domestic Product (GDP) estimates.
- The core sector is also known as Infrastructure output as they represent the basic industries that form the base of the economy.
Do you know about the Strategic Sectors?
The government has identified four strategic sectors where the presence of state-run companies will be reduced to a minimum.
- Atomic energy, space and defence
- Transport and telecommunications
- Power, petroleum, coal and other minerals and
- Banking, insurance and financial services
Try this PYQ:
Q.In the ‘Index of Eight Core Industries’, which one of the following is given the highest weight?
(a) Coal production
(b) Electricity generation
(c) Fertilizer production
(d) Steel production
Post your answers here.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Article 21
Mains level: Read the attached story
Every person on the planet has the right to live in a clean, healthy environment, as declared United Nations (UN) in a historic resolution.
Access to Clean, Healthy Environment
- The resolution recognizes the right to a clean, healthy and sustainable environment as a human right essential for the full enjoyment of all human rights and, among others.
- It calls upon States and international organizations to adopt policies and scale up efforts to ensure a clean, healthy and sustainable environment for all.
- The landmark development demonstrates that the member states can unite in the collective fight against the triple planetary crisis of climate change, biodiversity loss and pollution.
- The declaration sheds light on almost all the rights connected to the health of our environment.
- The declaration adopted by over 160 UN member nations, including India, is not legally binding.
Why such move?
- This right was not included in the Universal Declaration of Human Rights, 1948.
- So, this is a historic resolution that will change the very nature of international human rights law.
- The resolution will help to reduce environmental injustices and protection gaps.
- It can empower people, especially those in vulnerable situations, including environmental human rights defenders, children, youth, women and indigenous people.
Landmark resolution after 50 years
- Some 50 years ago, the United Nations Conference on the Environment in Stockholm concluded with a resolution placing environmental issues at the global forefront.
- Today, over 176 countries have adopted environmental framework laws on the basis of it.
- From a foothold in the 1972 Stockholm Declaration, these rights have been integrated into constitutions, national laws and regional agreements.
- In October 2021, it was recognised by the UN Human Rights Council.
What were other such developments?
- July 28, 2010, the UN general assembly recognised the right to water and sanitation through its resolution.
- It stated that clean drinking water and sanitation “are essential to the realisation of all human rights”.
- In response to this, governments across the world have changed their laws and regulations related to water and sanitation.
Issues over this declaration
- The words’ ‘clean’, ‘healthy’ and ‘sustainable’ lack an internationally agreed definition.
- The text fails to refer to the foundational principle of equity in international environmental law.
- Nevertheless, this has given more power in the hands of environmental activists to question environmentally destructive actions and policies.
Back2Basics: Right to Clean Environment in India
- The right to life has been used in a diversified manner in India.
- It includes, inter alia, the right to survive as a species, quality of life, the right to live with dignity and the right to livelihood.
- In India, this has been expressly recognised as a constitutional right under Article 21.
- It states: ‘No person shall be deprived of his life or personal liberty except according to procedures established by law.’
- The Supreme Court expanded this negative right in two ways.
- Firstly, any law affecting personal liberty should be reasonable, fair and just.
- Secondly, the Court recognized several unarticulated liberties that were implied by article 21.
- It is by this second method that the Supreme Court interpreted the right to life and personal liberty to include the right to a clean environment.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: State Assemblies for 2021 Report
Mains level: States Legislature efficiency
Kerala, which slipped to the eighth slot in holding Assembly sittings during the first wave of the COVID-19 pandemic in 2020, returned to the top spot in 2021, with its House sitting for 61 days, the highest in the country.
State Assemblies for 2021 Report
- The report on the functioning of State Assemblies for 2021 is published by the PRS Legislative Research (PRS), a New Delhi-based think tank.
How did other states fare?
- Odisha followed Kerala with 43 sitting days; Karnataka 40, and Tamil Nadu 34 days.
- But for the top three States, the average number of sittings of State legislatures would have been far lower than the present figure of 21 days.
- Of the 28 State Assemblies and one Union Territory’s legislature, 17 met for less than 20 days.
- Of them, five — Andhra Pradesh, Nagaland, Sikkim, Tripura and Delhi — met for less than 10 days.
- The figures for Uttar Pradesh, Manipur and Punjab were 17, 16 and 11, respectively.
- Andhra Pradesh with 20 ordinances and Maharashtra with 15 followed Kerala.
Why is this ranking significant?
- The National Commission to Review the Working of the Constitution (2000-02), headed by former Chief Justice of India M.N. Venkatachaliah, had prescribed the standards for working of legislatures.
- The Houses of State (/Union Territory) legislatures with less than 70 members, for example, Puducherry, should meet for at least 50 days a year and other Houses (Tamil Nadu), at least 90 days.
- The Presiding Officers’ conference, held in Gandhinagar in January 2016, suggested State legislatures hold a minimum of 60 days of sittings in a year.
- Between 2016 and 2021, the PRS points out, 23 State Assemblies met for an average of 25 days.
- As for the ordinance route, which should be, according to the Supreme Court, used under exceptional circumstances, 21 out of 28 States promulgated ordinances last year.
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