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Terrorism and Challenges Related To It

Virtual Digital Assets (VDA) and Terror Financing

op-ed snap | Security Issues | Mains Paper 3: Money-Laundering & Its Prevention
Context
- No Money for Terror conference hosted by the Union Ministry of Home Affairs concluded with a commitment from the 93 participating nations to end all financing of terror, including through the use of emerging digital technologies such as VDAs.
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Concerns regarding virtual digital assets
- VDAs for illicit activities: The concerns around the misuse of VDAs for illicit activities require careful legislative responses and forward-looking regulatory guardrails.
- Non reporting and non-transparency: On a fundamental level, these concerns stem from a lack of reporting and transparency norms, and an absence of international consensus on regulatory design.
- Lack of reliable data: The Reserve Bank of India’s (RBI) Deputy Director highlighted the difficulty in regulating VDAs, given the lack of reliable data on VDA transactions.
- Unregulated transactions: This allows bad actors to engage in unchecked transactions and defraud investors, as evinced by one of the (erstwhile) largest VDA exchanges FTX.
India’s role in regulating the VDA
- Leveraging G20 Presidency: As one of the highest-ranked countries in terms of VDA adoption, and now with the G20 presidency, India has a critical role to play in shaping the global regulatory environment.
- Empowering anti-money laundering authorities: In the short term, a viable approach for India is in taking the industry and the investor into confidence by allowing anti-money laundering (AML) authorities visibility over VDA transactions, and the power to impose controls upon them and prosecute in the event of any misuse.
- India should adopt FATF guidelines: There are several international templates to this effect. The Financial Action Task Force Guidelines on Virtual Asset Transactions (FATF Guidelines) are a case in point, which have been adopted by various jurisdictions, including the EU, Japan and Singapore.
FATFs Guideline regarding VDA regulation
- Minimum anti-money laundering standards: The FATF prescribes minimum Anti-money laundering standards that countries should employ to prevent the likelihood of misuse, and the FATF Guidelines prescribe the same for VDA transactions.
- Licensing and reporting of VDAs: The Guidelines are applicable to VDA service providers of member states like India. Key features of the FATF Guidelines include licence/registration requirements and extensive reporting and record-keeping obligations for VDA service providers.
- Travel rule obligations: One such obligation is the Travel Rule, which requires service providers to record the originator and beneficiary’s account details, transaction amount, and purpose of transaction for all wire transfers.
- Verifying identity above certain threshold: Customer due diligence obligations, which include verifying the customer and beneficiary’s identities should be conducted for all transactions exceeding $1,000.
- Obligation on service provider: The FATF Guidelines also require VDA service providers to perform enhanced due diligence obligations (such as corroborating the customer’s identity with a national database or potentially tracing the customer’s IP address to ensure there are no links to illicit activities) when a transaction is with a higher-risk country.
What are India’s current laws to regulate VDA?
- PMLA includes reporting obligation: India’s existing Anti-money laundering framework under the Prevention of Money Laundering Act, 2002 (PMLA) already applies these regulatory tools over traditional financial institutions. Notably, the PMLA also includes reporting obligations for overseas transactions that fall under the ambit of “suspicious transactions” under the framework.
- PMLA doesn’t apply to VDAs: Currently, the PMLA does not apply to the VDA industry.
- government can bring VDA under PMLA: The government has the power to notify any “designated business or profession” as a reporting entity under the PMLA and can issue a notification that classifies VDA service providers as a designated business.
Conclusion
- With the Digital Data Protection Bill and the Digital India Act already in the pipeline, Indians and digital businesses will soon have a coherent rights and responsibility framework to operate within. The time is ripe to extend regulatory oversight over the VDA industry so as to ensure that tech-innovation flourishes in a responsible, accountable manner.
Mains Question

Q. How virtual digital assets and terror financing are interlinked? What is the role of PMLA act in regulation of VDA in India?

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Climate Change Negotiations – UNFCCC, COP, Other Conventions and Protocols

What is Greenwashing?

| Enviro & Biodiversity | Mains Paper 1: Important Geophysical Phenomena
Reserve Bank Deputy Governor called for a taxonomy on green finance to avoid the risk of “greenwashing”.

What is ‘Greenwashing’?
- Greenwashing refers to misleading the general public into believing that companies, sovereigns or civic administrators are doing more for the environment than they actually are.
- This may involve making a product or policy seem more environmentally friendly or less damaging than it is in reality.
- The term was coined by environmentalist Jay Westerveld in 1986.
- The phenomenon came into practice as consumers and regulators increasingly sought to explore planet-friendly, recyclable and sustainable ‘green’ products.
- By 2015, 66% of consumers were willing to shell out more for a product that was environmentally sustainable.
How is it done?
- There is the indiscriminate use of the terms ‘net-zero’, ‘net-zero aligned’, ‘eco-friendly’, ‘green’ and ‘ecological’.
- Since there is no compliance mechanism, such practices are rampant.
Why does greenwashing happen?
- Greenwashing is done primarily for a company to either present itself as an ‘environment-friendly’ entity or for profit maximisation.
- It is achieved by introducing a product, catering to the inherent demand for environment-friendly products.
- In certain instances, it is done using the larger idea as a premise to cut down on certain operational logistics and providing consumer essentials.
What does it have to do with the financial sector?
- Ethical investing: Sustainable investing has become increasingly popular among millennials and impact investors concerned with ‘ethical investing’.
- Role of ESG credentials: Financial services providers expect increased scrutiny of a company’s Environmental, Social and Governance (ESG) credentials from regulators, shareholders, customers as well as other stakeholders.
- Transition funding: Financial institutions are expected to fund the transition towards renewable energy and discourage investments in further harnessing of conventional energy sources as coal, oil and gas.
Policy moves in India
- If the financial sector is to respond effectively to the demand for products that endeavour to introduce positive changes into the economy, it is imperative that ‘greenwashing’ is averted.
- In May this year, market regulator Securities and Exchange Board of India (SEBI) constituted an advisory committee to look into all ESG-related matters.
Key recommendations
- The expert committee recommends that financial institutions immediately discontinue all lending, underwriting and investments in companies wanting to strengthen or expand their coal-related infrastructure.
- As for oil and gas, it recommends the discontinuation of all investments that would involve exploration of new oil and gas fields, expansion of existing reserves and further production.
- Instead, companies should facilitate increased investment in renewable energy and institutions that are aligned to facilitate net zero emissions by 2050.
Way forward
- Companies must work towards reducing emissions across their entire value chain and not limit the endeavor to only one part of the chain.
- They must not invest, through any means, in harnessing fossil fuels or engage in deforestation and other environmentally destructive activities.
- In addition to this, companies cannot compensate for this investment by means of cheap credits, that “often lack integrity”.
- Further, all state and non-state actors must ensure a ‘just transition’ such that livelihoods are not affected.
- The committee also recommends a transition from voluntary disclosures (pertaining to net emissions) to regulatory norms.
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Coastal Zones Management and Regulations

Kerala government publishes map for people to seek exemption from ESZ

Prelims Only | Enviro & Biodiversity | Mains Paper 3: Conservation, Environmental Pollution & Degradation, Eia
The Kerala government has published a forest department map that better reflects the block and plot-wise details of localities that could potentially fall under the Supreme Court-suggested one-km ecologically sensitive buffer zone (ESZ) around forests if imposed.

What are the Eco-sensitive Zones (ESZs)?
- Eco-Sensitive Zones (ESZs) or Ecologically Fragile Areas (EFAs) are areas notified by the MoEFCC around Protected Areas, National Parks and Wildlife Sanctuaries.
- The purpose of declaring ESZs is to create some kind of “shock absorbers” to the protected areas by regulating and managing the activities around such areas.
- They also act as a transition zone from areas of high protection to areas involving lesser protection.
How are they demarcated?
- The Environment (Protection) Act, 1986 does NOT mention the word “Eco-Sensitive Zones”.
- However, Section 3(2)(v) of the Act, says that Central Government can restrict areas in which any industries, operations or processes or class of industries, operations or processes shall be carried out or shall not, subject to certain safeguards.
- Besides Rule 5(1) of the Environment (Protection) Rules, 1986 states that central government can prohibit or restrict the location of industries and carrying on certain operations or processes on the basis of certain considerations.
- The same criteria have been used by the government to declare No Development Zones (NDZs).
Defining its boundaries
- An ESZ could go up to 10 kilometres around a protected area as provided in the Wildlife Conservation Strategy, 2002.
- Moreover, in the case where sensitive corridors, connectivity and ecologically important patches, crucial for landscape linkage, are beyond 10 km width, these should be included in the ESZs.
- Further, even in the context of a particular Protected Area, the distribution of an area of ESZ and the extent of regulation may not be uniform all around and it could be of variable width and extent.
Activities Permitted and Prohibited
- Permitted: Ongoing agricultural or horticultural practices, rainwater harvesting, organic farming, use of renewable energy sources, and adoption of green technology for all activities.
- Prohibited: Commercial mining, saw mills, industries causing pollution (air, water, soil, noise etc), the establishment of major hydroelectric projects (HEP), commercial use of wood, Tourism activities like hot-air balloons over the National Park, discharge of effluents or any solid waste or production of hazardous substances.
- Under regulation: Felling of trees, the establishment of hotels and resorts, commercial use of natural water, erection of electrical cables, drastic change of agriculture system, e.g. adoption of heavy technology, pesticides etc, widening of roads.
What is the recent SC judgment that has caused an uproar in Kerala?
- On June 3, a three-judge bench of the Supreme Court heard a PIL that sought to protect forest lands in the Nilgiris in Tamil Nadu, but was later expanded to cover the entire country.
- In its judgment, the court while referring to the 2011 guidelines as “reasonable”, directed all states to have a mandatory 1-km ESZ from the demarcated boundaries of every protected area.
- It also stated that no new permanent structure or mining will be permitted within the ESZ.
- If the existing ESZ goes beyond 1-km buffer zone or if any statutory instrument prescribes a higher limit, then such extended boundary shall prevail, the court, as per the Live Law report.
Why are people protesting against it?
- There is a high density of human population near the notified protected areas.
- Farmer’s groups and political parties have been demanding that all human settlements be exempt from the ESZ ruling.
- The total extent of the wildlife sanctuaries in Kerala is eight lakh acres.
- If one-km of ESZ is demarcated from their boundaries, around 4 lakh acres of human settlements, including farmlands, would come within that purview.
Try this PYQ

With reference to ‘Eco-Sensitive Zones’, which of the following statements is/are correct?
1. Eco-Sensitive Zones are the areas that are declared under the Wildlife (Protection) Act, 1972
2. The purpose of the declaration of Eco-Sensitive Zones is to prohibit all kinds of human activities, in those zones except agriculture.
Select the correct answer using the code given below:

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2

Post your answers here.
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Trade Sector Updates – Falling Exports, TIES, MEIS, Foreign Trade Policy, etc.

NITI Aayog cautions against cutting trade ties with China

| Economics | Mains Paper 3: Indian Economy
Amid demands for snapping trade ties with China for its transgressions on the border, former NITI Aayog Vice-Chairman has opined that cutting trade ties with Beijing would amount to sacrificing India’s potential economic growth.

What is the news?
- Panagariya said both countries can play the trade sanctions game.
- The ability of a $17 trillion economy (China) to inflict injury on a $3 trillion economy (India) is far greater than the reverse.
Why in news?
- The trade deficit, the difference between imports and exports, between India and China touched $51.5 billion during April-October this fiscal.
- The deficit during 2021-22 had jumped to $73.31 billion as compared to $44.03 billion in 2020-21.
A quick backgrounder
- Trade ties began to boom since the early 2000s.
- This was driven largely by India’s imports of Chinese machinery and other equipment.
- It rose up from $3 billion in the year 2000 to $42 billion in 2008, the year China became India’s largest trading partner.
The Hindi-Chini buy buy
- A third of machinery and almost two-fifths of organic chemicals that India purchases from the world come from China.
- Automotive parts and fertilizers are other items where China’s share in India’s import is more than 25 per cent.
- Several of these products are used by Indian manufacturers in the production of finished goods, thus thoroughly integrating China in India’s manufacturing supply chain.
- For instance India sources close to 90 per cent of certain mobile phone parts from China.
India’s export to China
- Even as an export market, China is a major partner for India.
- China is the third-largest destination for Indian shipments.
- At the same time, India only accounts for a little over two percent of China’s total exports, according to the Federation of Indian Export Organisation (FIEO).
Should we worry about this?
- Trade deficits/surpluses are just accounting exercises and having a trade deficit against a country doesn’t make the domestic economy weaker or worse off.
- In this light, India’s trade imbalance with China should not be viewed in isolation.
- For instance, pharmaceuticals that India exports to the world require ingredients that are imported from China.
- Chinese imports of Indian seafood are one area that has recently shown robust growth and carries scope to grow in future.
So, having a trade deficit is good?
- Of course NOT. Running persistent trade deficits across all countries raises two main issues.
1. Availability of foreign exchange reserves to “buy” the imports.
2. Lack of domestic capacity to produce most efficiently.
Can we ban trade with China?

Ans. Certainly NOT!
- It will hurt the Indian poor the most: This is because the poor are more price-sensitive. For instance, if Chinese TVs were replaced by either costlier Indian TVs or less efficient ones, unlike poor, richer Indians may buy the costlier option.
- It will punish Indian producers and exporters: Several businesses in India import intermediate goods and raw materials, which, in turn, are used to create final goods — both for the domestic Indian market as well as the global market (as Indian exports).
- Pharma sector could be worst hit: For instance, of the nearly $3.6 billion worth of ingredients that Indian drug-makers import to manufacture several essential medicines, China catered to around 68 percent.
- Ban will barely hurt China: According to the United Nations Conference on Trade and Development (UNCTAD) data for 2018, 15.3% of India’s imports are from China, and 5.1% of India’s exports go to China.
- Chinese money funds Indian unicorns: India and China have also become increasingly integrated in recent years. Chinese money, for instance, has penetrated India’s technology sector, with companies like Alibaba and Tencent strategically pumping in billions of dollars into Indian startups such as Zomato, Paytm, Big Basket and Ola.
- India will lose policy credibility: It has also been suggested that India should renege on existing contracts with China. This can be detrimental to India’s effort to attract foreign investment.
China is our Frenemy. Here is why.
- The first thing to understand is that turning a border dispute into a trade war is unlikely to solve the border dispute.
- Worse, given India and China’s position in both global trades as well as relative to each other, this trade war will hurt India far more than China.
- Again, these measures will be most poorly timed since the Indian economy is already at its weakest point ever — facing a sharp GDP contraction.
Way forward
- Panagariya suggested to expand trade faster with other trading partners rather than cutting it with Beijing through a blunt instrument such as trade sanctions.
- We should take advantage of India’s excellent growth prospects for the next decade and concentrate on growing the economy bigger as fast as possible.
- Once we are the third largest economy, our sanctions threats are likely to carry greater credibility.
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Minimum Support Prices for Agricultural Produce

Centre rules out an increase in MSP for Cotton

Prelims Only | Agriculture | Mains Paper 3: Major Crops & Cropping Patterns
While cotton farmers in several States have demanded an increase in the minimum support price (MSP) of the crop, the Centre has said that it is watching the cotton production scenario and decide accordingly.

What is MSP?
- The MSP assures the farmers of a fixed price for their crops, well above their production costs.
- MSP, by contrast, is devoid of any legal backing. Access to it, unlike subsidized grains through the PDS, isn’t an entitlement for farmers.
- They cannot demand it as a matter of right. It is only a government policy that is part of administrative decision-making.
- The Centre currently fixes MSPs for 23 farm commodities based on the Commission for Agricultural Costs and Prices (CACP) recommendations.
Fixing of MSPs
- The CACP considered various factors while recommending the MSP for a commodity, including the cost of cultivation.
- It also takes into account the supply and demand situation for the commodity; market price trends (domestic and global) and parity vis-à-vis other crops; and implications for consumers (inflation), environment (soil and water use) and terms of trade between agriculture and non-agriculture sectors.
What changed with the 2018 budget?
- The Budget for 2018-19 announced that MSPs would henceforth be fixed at 1.5 times of the production costs for crops as a “pre-determined principle”.
- Simply put, the CACP’s job now was only to estimate production costs for a season and recommend the MSPs by applying the 1.5-times formula.
How was this production cost arrived at?
- The CACP projects three kinds of production cost for every crop, both at the state and all-India average levels.
- ‘A2’ covers all paid-out costs directly incurred by the farmer — in cash and kind — on seeds, fertilizers, pesticides, hired labor, leased-in land, fuel, irrigation, etc.
- ‘A2+FL’ includes A2 plus an imputed value of unpaid family labor.
- ‘C2’ is a more comprehensive cost that factors in rentals and interest forgone on owned land and fixed capital assets, on top of A2+FL.
How much produce can the government procure at MSP?
- The MSP value of the total production of the 23 crops worked out to around Rs 10.78 lakh crore in 2019-20.
- Not all this produce, however, is marketed. Farmers retain part of it for self-consumption, the seed for the next season’s sowing, and also for feeding their animals.
- The marketed surplus ratio for different crops is estimated to range differently for various crops.
- It ranges from below 50% for ragi and 65-70% for bajra (pearl millet) and jawar (sorghum) to 75% for wheat, 80% for paddy, 85% for sugarcane, 90% for most pulses, and 95%-plus for cotton, soybean, etc.
- Taking an average of 75% would yield a number of just over Rs 8 lakh crore.
- This is the MSP value of production that is the marketable surplus — which farmers actually sell.
Nature of MSP
- There is currently no statutory backing for these prices, nor any law mandating their enforcement.
Farmers demand legalization
- Legal entitlement: There is a demand that MSP based on a C2+50% formula should be made a legal entitlement for all agricultural produce.
- Private traders’ responsibility: Some say that most of the cost should be borne by private traders, noting that both middlemen and corporate giants are buying commodities at low rates from farmers.
- Mandatory purchase at MSP: A left-affiliated farm union has suggested a law that simply stipulates that no one — neither the Government nor private players — will be allowed to buy at a rate lower than MSP.
- Surplus payment by the govt.: Other unions have said that if private buyers fail to purchase their crops, the Government must be prepared to buy out the entire surplus at MSP rates.
- Expansion of C2: Farm unions are demanding that C2 must also include capital assets and the rentals and interest forgone on owned land as recommended by the National Commission for Farmers.
Government’s position
- The PM has announced the formation of a committee to make MSP more transparent, as well as to change crop patterns — often determined by MSP and procurement.
- The panel will have representatives from farm groups as well as from the State and Central Governments, along with agricultural scientists and economists.
Back2Basics: Cotton Cultivation in India
- Cotton, a semi-xerophyte, is grown in tropical & sub-tropical conditions.
- A minimum temperature of 15C is required for better germination at field conditions.
- The optimum temperature for vegetative growth is 21-27C & it can tolerate temperature to the extent of 43C but temperature below 21C is detrimental to the crop.
- Cotton is grown on a variety of soils ranging from well-drained deep alluvial soils in the north to black clayey soils of varying depth in central region and in black and mixed black and red soils in south zone.
- It is semi-tolerant to salinity and sensitive to water logging and thus prefers well-drained soils.
Sowing season
- The sowing season of cotton varies considerably from tract to tract and is generally early (April-May) in northern India.
- Sowing is delayed as its proceeds down south (monsoon based in southern zone).
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Uncontrolled Re-entries of Satellites

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

satellite

Many dignitaries have signed an open letter published by the Outer Space Institute (OSI) calling for both national and multilateral efforts to restrict uncontrolled re-entries of Satellites back to earth.

About Open Space Institute (OSI)

OSI is a conservation organization that seeks to preserve scenic, natural and historic landscapes for public enjoyment, conserve habitats while sustaining community character, and help protect the environment.
It uses policy initiatives and ground-level activism to help accomplish its goals.

What are the stages of a rocket launch?

Rockets have multiple stages.
Once a stage has increased the rocket’s altitude and velocity by a certain amount, the rocket sheds it.
Some rockets jettison all their larger stages before reaching the destination orbit; a smaller engine then moves the payload to its final orbit.
Others carry the payload to the orbit, then perform a deorbit manoeuvre to begin their descent.
In both cases, rocket stages come back down — in controlled or uncontrolled ways.

What is an uncontrolled re-entry?

It is the phenomenon of rocket parts falling back to earth in unguided fashion once their missions are complete.
In an uncontrolled re-entry, the rocket stage simply falls.
Its path down is determined by its shape, angle of descent, air currents and other characteristics.
It will also disintegrate as it falls.

How many satellites are there in space?

The Soviet Union launched the first artificial satellite in 1957.
Today, there are more than 6,000 satellites in orbit, most of them in low-earth (100-2,000 km) and geostationary (35,786 km) orbits, placed there in more than 5,000 launches.
The number of rocket launches have been surging with the advent of reusable rocket stages.

Why is this hazardous?

As the smaller pieces fan out, the potential radius of impact will increase on the ground.
Some pieces burn up entirely while others don’t.
But because of the speed at which they’re travelling, debris can be deadly.
If re-entering stages still hold fuel, atmospheric and terrestrial chemical contamination is another risk.

Why are we discussing this?

The OSI letter cited examples of parts of a Russian rocket in 2018 and China’s Long March 5B rockets in 2020 and 2022 striking parts of Indonesia, Peru, India and Ivory Coast, among others.
Many news reports have focused on Chinese transgressions of late, but historically, the US has been the worst offender.
Parts of a SpaceX Falcon 9 that fell down in Indonesia in 2016 included two “refrigerator-sized fuel tanks”.

Damage control mechanism for uncontrolled re-entry

There is no international binding agreement to ensure rocket stages always perform controlled re-entries nor on the technologies with which to do so.
The Liability Convention, 1972 requires countries to pay for damages, not prevent them.
These technologies include wing-like attachments, de-orbiting brakes, and extra fuel on the re-entering body, and design changes that minimise debris formation.

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ISRO Missions and Discoveries

[pib] Vainu Bappu Observatory

Prelims Only | Science Tech | Mains Paper 3: Awareness in various sc and tech fields
The several stellar discoveries of the 40-inch telescope at the Vainu Bappu Observatory in Kavalur, Tamil Nadu, were highlighted at the celebration of its 50 years of its operation.

Vainu Bappu Observatory
- The Vainu Bappu Observatory is an astronomical observatory owned and operated by the Indian Institute of Astrophysics.
- It is located at Kavalur in the Javadi Hills, near Vaniyambadi in Tirupathur district in Tamil Nadu.
- The 40-inch telescope was installed in 1972 and started producing important astronomical discoveries soon after.
- More than a generation of astronomers were trained at this telescope as well.
Significant feats achieved by VBO

The telescope set up by Professor Vainu Bappu has played a significant role in astronomy with major discoveries like-
1. Presence of rings around the planet Uranus,
2. New satellite of Uranus,
3. Presence of an atmosphere around Ganymede which is a satellite of Jupiter
4. Discovery and study of many ‘Be stars’, Lithium depletion in giant stars, optical variability in Blazars, the dynamics of the famous supernova SN 1987A and so on.
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Economic Indicators and Various Reports On It- GDP, FD, EODB, WIR etc

India’s Path to Prosperity through Formal Employment

op-ed snap | Economics | Mains Paper 3: Indian Economy,Issues relating growth and development, employment
Context
- Mass prosperity for massive populations is hard. India’s large remittances from a small population overseas and IT sectors employability reinforce that our mass prosperity strategy should be human capital and formal jobs.
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Why human capital formation is effective tool for mass prosperity?
- Disproportionate contribution of IT employees: A strong case for human capital-driven productivity is our software employment — 0.8 per cent of workers generate 8 per cent of GDP.
- Remittance by NRIs: This case is reinforced by remittances from our overseas population of less than 2 per cent of our resident population crossing $100 billion last year.
- Shift towards formal employment: A World Bank report suggests that the qualitative shift during the previous five years from low-skilled, informal employment in Gulf countries (dropped from 54 per cent to 28 per cent) to high-skilled formal jobs in high-income countries (increased from 26 per cent to 36 per cent) is significant.
- Remittances are higher than FDI: Our rich forex remittance harvest roughly 25 per cent higher than FDI and 25 per cent less than software exports is fruit from the tree of human capital and formal jobs.
Limitations of Fiscal and monetary policy
- Credit availability is bigger issue: Monetary policy is, at best, a placebo, painkiller, or steroid especially since credit availability is a bigger problem in India than credit cost.
- Source of finance is important than expenditure: Global experience suggests where governments spend money (pensions, interest, salaries, education, healthcare, roads, etc) and how this spending is financed (taxes or debt) matters more than how much is spent (about Rs 80 lakh crore in India this year).
- Fiscal policy tends to overshoot: Covid made enormous fiscal and monetary policy demands, but the bigger the binge, the bigger the hangover. Western central banks are struggling to shrink their balance sheets because they used what Harvard’s Paul Tucker calls “unelected power” to chase goals outside their mandate, administer medicine with poorly understood side effects, and speed down highways with no known return paths.
- India avoided the fiscal and monetary trap: Rich-country borrowing rates have risen by 300 per cent plus and inflation hurts the poor the most. India avoided these fiscal and monetary policy excesses. This prudence now combines with previous structural reforms (GST, IBC, MPC, UPI, DBT, NEP, etc) and a reform “tone from the top” to create a fertile habitat for productive citizens and firms.
What should be the strategy in next fiscal year for employment generation?
- Targeting the job creation: The Finance Bill must target productivity and continuity by legislating human capital and formal job reforms previously proposed.
- NEP should be implemented in 5 years: It should reduce the implementation glide path for the powerful National Education Policy 2020 from 15 years to five years.
- Abolishing the licensing: It should abolish separate licensing requirements for online degrees and freely allow all our 1,000-plus accredited universities to launch online learning.
- Accelerating apprentices: It should accelerate growing our 0.5 million apprentices to 10 million by allowing all universities to launch degree apprentice courses under tripartite contracts with employers under the Apprentices Act.
What are the other steps that can be taken through next budget?
- Notify labour code: It should notify the four labour codes for all central-list industries while appointing a tripartite committee to converge them into one labour code by the next budget.
- Universal enterprise number: It should continue EODB reforms by designating every enterprise’s PAN number as its Universal Enterprise Number.
- Remove the factory act: It should explore manufacturing employment by abolishing the Factories Act this painful Act accounts for 8,000 of the 26,000 plus criminal provisions in employer compliance and require all employers to comply under each state’s Shops and Establishment Act (like Infosys, TCS, and IBM India do).
- Ensuring better compliances by employer: It should create a non-profit corporation (like NPCI in payments) that will operate an API-driven National Employer Compliance Grid and enable central ministries and state governments to rationalise, digitise and decriminalise their employer compliances.
- Making EPFO contribution optional: Making employees’ provident fund contributions optional but raising employer PF contributions from the current 12 per cent to 13 per cent. It should notify a previous budget announcement to create employee choice in their contributions to health insurance (ESIC or insurance companies) and pensions (EPFO or NPS).
- Subsidy to high wage employer: Most importantly, it should link all employer subsidies and tax incentives to high-wage employment creation (a difficult-to-fudge and easy-to-measure effectiveness metric for this public spending is employer provident fund payment).
Conclusion
- Experience and evidence now firmly suggest the odds of mass prosperity in the planet’s most populous nation rise from possible to probable by anchoring our strategy in human capital and formal jobs rather than fiscal or monetary policy.
Mains Question

What are the limitations of Fiscal and monetary policy in mass welfare of people? What are the possible strategies for creation of mass prosperity in India?

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Genetically Modified (GM) crops – cotton, mustards, etc.

Genetically modified Crops and Transgenic Technology Needs Precautions

op-ed snap | Economics | Mains Paper 3: Agriculture and related issues
Context
- The Supreme Court’s Technical Expert Committee and two unanimous reports of multi-party parliamentary standing committees have recommended that genetically modified (GM) Herbicide Tolerant (HT) crops should be banned in India.
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Why transgenic technology is worrisome?
- Uncontrollable and irreversible: Transgenic technology, unlike other technologies, is uncontrollable and irreversible after environmental release.
- Self-propagation and proliferation: Living Modified Organisms (LMOs), as the Cartagena Protocol on Biosafety refers to Genetically Modified Organisms (GMOs), propagate themselves and proliferate.
- Long term assessment is necessary: This process cannot be reversed. Therefore, any deliberate environmental release has to be only after thorough, independent, peer-reviewed assessment of long-term implications.
- Precaution is necessary: The precautionary principle is a cornerstone because of the unpredictability and time lag of serious outcomes manifesting in highly complex living systems, and their irreversibility. To draw a parallel, not a single one of 330 invasive species (for example, lantana, parthenium) in India has yet been eliminated, despite estimated damage of Rs 8.3 trillion by just 10 of them!
Reality check on GM crops
- Less countries adopted GM technology: More than 25 years after their introduction, GM crops are still globally grown in just 29 out of 172 countries. Moreover, 91 per cent of GM crop area continues to be in just five countries (USA, Brazil, Argentina, Canada, India).
- BT cotton demand is declining: Most countries of Europe and Japan, Israel, Russia, Malaysia etc., do not grow GM crops. In China, a first adopter, Bt cotton area has been declining and non-GM hybrid technology is used for rapeseed/mustard.
- Heavy focus on two traits only: Only two traits are present in over 85 per cent of GM crops grown herbicide tolerance (HT, where crop plants are modified to withstand large amounts of toxic weed-killing chemicals), and/or insect resistance (pesticidal toxin, usually Bt, is produced inside the plant).
Negative impact of HT crops
- Damage to ecology: HT crops result in not only ecological damage, but human health impacts for consumers. Like tobacco, once declared safe, the effects take long to manifest.
- Honey production will be affected: Beekeepers say that HT mustard will affect honey production and contaminated honey will damage exports.
- Human health will be affected: As regards human health, probable carcinogenicity, neuro-toxicity, reproductive health problems, organ damage etc. have been documented by independent research on GM crops and associated herbicides, once claimed by developers and regulators to be “safe”.
- Campaign against release of GM crops: Like thousands of doctors in other countries, over 100 eminent Indian doctors have conveyed their concerns asked that no HT food crops be released and the planted GM mustard be uprooted before flowering.
What is the issues vis-e vis DMH-11 Mustard crop?
- Proponent says Mustard is not a HT crop: It is claimed that DMH-11 is not an HT crop as the use of the Bar gene which confers an herbicide tolerance trait is essentially for the pollination control technology in creating hybrids, and glufosinate herbicide will only be used during seed production.
- Opponent says it’s a HT crop: The reality is that by virtue of the Bar gene being present in both parental lines, and thereby also in all their hybrid offspring, this GM mustard can withstand application of a toxic weedkiller, glufosinate, including in farmers’ fields. It should therefore have been assessed as an HT crop.
- Government failed to prevent illegal use of HT cotton: If governments, for over 10 years, have been aware of the illegal planting of herbicide tolerant cotton and rampant illegal use of glyphosate on such HT cotton, and have been unable or unwilling to stop this, what “regulatory process” will now prevent farmers in search of low-cost weeding options from spraying glufosinate on herbicide tolerant mustard?
What are the observations of SC and parliamentary Committee?
- Absence of regulatory protocol: The ongoing litigations in the Supreme Court are about serious shortcomings in our regulatory regime. Minutes of meetings of the regulatory body GEAC and the “guidelines and protocols” on the regulator’s website reflect an absence of regulatory protocols for HT crops.
- Inadequate bio testing: And yet a crop with an HT trait is being released in the environment! The technical expert committee (TEC) appointed by the SC and the unanimous multi-party reports of two parliamentary standing committees have exposed serious lapses and inadequacies in bio-safety testing.
- Against the release of GM crops: They all advised that herbicide tolerant crops, which GM Mustard is, should not be released in Indian conditions.
- Government panel recommended the ban: Even the government-nominated experts in the TEC asked for a ban on HT crops. The government, surely, cannot call them unscientific.
- No independent participant in testing: Testing on GM mustard has been done with test protocols evolved by the crop developer, and most tests were done by the applicant. No independent health expert participated in the committees that looked at GM mustard safety.
- No biosafety data: To this day, biosafety data of GM mustard has not been posted on the regulator’s website for independent scrutiny.
Conclusion
- GM crop transgenic technology comes with mixed baggage. Government must strike the balance between biodiversity concern and welfare of farmers. Outright ban or permission without credible data and scrutiny must be avoided.
Mains Question

Q. What are the worrisome aspects of transgenic technology? What are the observations of Supreme court and parliamentary committee regarding GM crops?

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AYUSH – Indian Medicine System

World Ayurveda Congress: Aligning traditional medicine with modern medicines

op-ed snap | Science Tech | Mains Paper 2: Health & Education
Context
- Prime Minister Narendra Modi commended the recent growth of traditional medicine (TM), and Ayurveda in particular, while addressing the World Ayurveda Congress 2022 (WAC) earlier this month. Noting the lag in evidence despite considerable research, he gave a clarion call “to bring together medical data, research, and journals and verify claims (benefit) using modern science parameters”.
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All you need to know about World Ayurveda Congress (WAC)
- Platform by World Ayurveda foundation: The World Ayurveda Congress (WAC) is a platform established by World Ayurveda Foundation to propagate Ayurveda globally in its true sense.
- Platform to connect various stakeholders in medicine: World Ayurveda Congress (WAC) is a platform to connect Ayurveda practitioners, medicine manufacturers, enthusiasts and academicians.
- What is the mandate: World Ayurveda Congress (WAC) & Arogya Expo monitors progress and initiate missions and collect feedbacks.
World Ayurveda Congress (WAC), 2022
- 9th edition of WAC held at Panjim, Goa: The 9th edition of World Ayurveda Congress (WAC) & Arogya Expo was organized at PANJIM, GOA.
- Organised by Ministry of AYSUSH on the principle of whole government approach (WGA): The WAC organised by the Ministry of AYUSH on the ‘Whole Government Approach’ (WGA) to foster and strengthen the research ecosystem for AYUSH systems.
- What is Whole System Approach (WSA): The concept of WGA is in consonance with the “Whole System Approach” (WSA). WSA encompasses integrated and network participation of several stakeholders (including patients and the community) for better solutions (treatment outcomes) in a challenging and complex situation. IM is an important component of WSA in the current context.
- Active Participation: The event witnessed the active participation of more than 40 countries and all states of India.
- PM’s vision: To transform the healthcare system of the country and to develop a healthy society, there is a need to think holistically and integrate the Traditional medicine (TM) and modern medicine system (MM).
World Ayurveda Foundation (WAF)
- Aim of WAF: WAF is an initiative by Vijnana Bharati aimed at global propagation of Ayurveda, founded in 2011.
- Objective and core principle: The objectives of WAF reflect global scope, propagation and encouragement of all activities scientific and Ayurveda related are the core principles.
- Focus Areas: Support to research, health-care programmes through camps, clinics and sanatoriums, documentation, organization of study groups, seminars, exhibitions and knowledge initiatives to popularize Ayurveda in the far corners of the world are the broad latitudes of focus at WAF.
What is Traditional Medicine?
- According to WHO: The WHO describes traditional medicine as the total sum of the “knowledge, skills and practices indigenous and different cultures have used over time to maintain health and prevent, diagnose and treat physical and mental illness”.
- Culmination of multiple ancient practices: Its reach encompasses ancient practices such as acupuncture, ayurvedic medicine and herbal mixtures as well as modern medicines.
- Percentage of people use traditional medicine: of According to WHO estimates, 80% of the world’s population uses traditional medicine.
Traditional medicine in India
- It is often defined as including practices and therapies such as Yoga, Ayurveda, Siddha that have been part of Indian tradition historically, as well as others such as homeopathy that became part of Indian tradition over the years.
- Ayurveda and yoga are practised widely across the country.
- The Siddha system is followed predominantly in Tamil Nadu and Kerala.
- The Sowa-Rigpa System is practised mainly in Leh-Ladakh and Himalayan regions such as Sikkim, Arunachal Pradesh, Darjeeling, Lahaul & Spiti.
How TM modalities (such as Ayurveda or homoeopathy) can scientifically align with MM for a better outcome?
- Remarkable success in treating neurological diseases: A recently established Department of IM in NIMHANS continued to show remarkable success in treating difficult neurological diseases with a team of Ayurvedic and MM physicians and carefully planned and monitored IM strategy.
- CRD projects: Modern rheumatology practice in the Centre for Rheumatic Diseases (CRD) model includes critical elements of TM and Ayurveda, which have shown unequivocal evidence in CRD research projects
- Evaluation based on other protocols: Several controlled protocols-based evaluations of standardised Ayurvedic drugs and other TM modalities (such as diet, exercise, yoga, and counselling), often in conjunction with MM, in arthritis patients, were completed.
- Sustained clinical improvement in patients suffering from active Rheumatoid arthritis (RA): RA is a severely painful crippling lifelong autoimmune condition, mostly seen in women, and universally acknowledged as difficult to treat. Supervised and monitored IM intervention (including Ayurvedic drugs) over several years showed a consistently superior and sustained clinical improvement in patients suffering from active RA.
Relationship between AYUSH and Modern medicines
- AYUSH systems include Ayurveda, Homeopathy, Unani, Siddha, and other TM.
- AYUSH systems and MM differ radically in several ways or so it seems.
- Modern scientific research in Ayurveda is often at variance with classical Ayurveda.
- Unlike MM, TM has at its core a personalised approach. MM is dominantly reductionist.
- The ambitious futuristic programme of TM and IM by AYUSH is well-intended and in the right direction.
Conclusion
- TM and Ayurveda need to respond to the new world order, which has changed substantially recently. It is reasonably certain that MM and TM in the current format will continue to treat several medical disorders and altered health states. But evidence-based medicine will become the new mantra. Also, informed and empowered patients and people will continue to make the right choices.
Mains question

Q. What is World Ayurveda congress? What is tradition medicines? How Traditional medicines can align with modern medicines to treat several serious medical disorders.

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