The National Payments Corporation of India (NPCI) has extended by two years the deadline to comply with its 30 percent cap on the market share of platforms operating on the Unified Payments Interface (UPI).
What is UPI?
Unified Payments Interface (UPI) is an instant real-time payment system developed by National Payments Corporation of India (NPCI) facilitating inter-bank transactions.
The interface is regulated by the Reserve Bank of India (RBI) and works by instantly transferring funds between two bank accounts on a mobile platform.
What is the NPCI plan for UPI?
NPCI had initially planned to enforce the market cap rules in January 2021.
It aimed to limit any single payments app from processing more than 30 per cent of UPI transactions in a month.
Why extension?
The extension is being seen as a major relief for Walmart and Flipkart-backed PhonePe and Google Pay, which currently command a majority of the UPI market share.
How could it impact UPI platforms?
Industry analysts believe the move comes as a shot in the arm for PhonePe and Google Pay, which collectively control more than 80 per cent of UPI’s market share.
For platforms like Paytm and WhatsApp Pay, however, the extension could be seen as a natural loss.
As of October, Paytm had a market share of 15 per cent on UPI.
In comparison, PhonePe had a 47 per cent market share, while GooglePay accounted for around 35 per cent.
How is UPI performing?
According to the Reserve Bank of India’s Payment Vision 2025, UPI is expected to register an average annualized growth of 50 percent.
After touching a new high of Rs 12.11 lakh crore in October, the UPI transaction value for the month of November came in at Rs 11.90 lakh crore.
However, the transaction count at 7.3 billion in October remained the same in November.
Try this PYQ:
With reference to digital payments, consider the following statements:
BHIM app allows the user to transfer money to anyone with a UPI-enabled bank account.
While a chip-pin debit card has four factors of authentication, BHIM app has only two factors of authentication.
Which of the statements given above is/ are correct? (CSP 2018)
In 2020, India has been ranked first in the Social Hostilities Index (SHI) released by US think-tank Pew Research Center.
What is Social Hostilities Index (SHI)?
SHI measures acts of religious hostility by private individuals, organisations or groups in society.
The SHI measures acts of religious hostility by private individuals, organizations or groups.
The index comprises 13 metrics, including religion-related armed conflict or terrorism and mob or sectarian violence.
Questions used to compute the SHI included whether the country saw violence motivated by religious hatred or bias, whether individuals faced harassment or intimidation motivated by religious hatred or bias and whether there was mob violence against those of particular religious groups.
How bad has India fared?
At 9.4 out of a maximum possible score of 10, India’s SHI in 2020 was worse than neighbouring Pakistan and Afghanistan, and a further increase in its own index value for 2019, the Pew data showed.
India has faced severe backlash due to its crackdown on a ‘religious’ congregation held in New Delhi defying the COVID pandemic.
Other components: Government Restrictions Index (GRI)
India much better on a second index: the Government Restrictions Index (GRI).
This index looks at laws, policies and state actions restricting religious beliefs and practices.
China ranked the worst, with a score of 9.3.
India’s 34th rank was enough to categorize it among countries with “high” levels of such government restrictions.
The GRI comprises 20 measures, including efforts by governments to ban particular faiths, prohibit conversion, limit preaching or give preferential treatment to one or more religious groups
Official data for substantiation
By India’s own official crime statistics, the picture is more mixed.
According to police data, religious riots for which cases were filed rose substantially in 2020, and declined again in 2021.
But there have been significant variations over time, and the numbers are too low as a share of overall rioting incidents to indicate a definitive trend.
Moreover, the home ministry no longer provides data on “communal incidents”, and the National Crime Records Bureau (NCRB) now only publishes data on religious “riots”.
In the rankings by the International Civil Aviation Organisation (ICAO), India is now at the 48th position, a “quantum leap” from the 102nd rank it had in 2018.
ICAO Assessment
Under the ICAO standards, the Effective Implementation (EI) of six areas were assessed. They are LEG, ORG, PEL, OPS, AIR and AGA.
LEG is Primary Aviation Legislation and Specific Operating Regulations;
ORG is Civil Aviation Organisation;
PEL is Personnel Licensing and Training;
OPS is Aircraft Operations;
AIR is Airworthiness of Aircraft; and
AGA is Aerodrome and Ground Aid.
How has India fared in ICAO ranking?
With a score of 85.49 per cent each, India and Georgia are at the 48th position.
Neighbouring Pakistan is at the 100th spot with a score of 70.39 per cent.
Global scenario
The rankings are topped by Singapore with a score of 99.69 per cent.
It is followed by the UAE at the second position with a score of 98.8 per cent and the Republic of Korea is at the third place (98.24 per cent).
Others in the top ten are France (4th; 96.42 per cent), Iceland (5th; 95.73 per cent), Australia (6th; 95.04 per cent), Canada (7th; 94.95 per cent), Brazil (8th; 94.72 per cent), Ireland (9th; 94.6 per cent) and Chile (10th; 93.9 per cent).
What is ICAO?
The ICAO is a specialized agency of the UN that coordinates the principles and techniques of international air navigation.
It fosters the planning and development of international air transport to ensure safe and orderly growth.
ICAO headquarters are located in the Quartier International of Montreal, Quebec, Canada.
Functions of ICAO
Standardization: The ICAO Council adopts standards and recommended practices concerning air navigation, its infrastructure, flight inspection, prevention of unlawful interference, and facilitation of border-crossing procedures etc.
Investigation standards: ICAO defines the protocols for air accident investigation that are followed by transport safety authorities in countries signatory to the Chicago Convention on International Civil Aviation.
Marathi Seminar by IPS, Amol Murkut sir | Career guidance session on how to prepare for government competitive exams including MPSC and UPSC | Register &Get Value-added Free notes for MPSC & UPSC
Guys, Every year millions of candidates start and sit for various Govt. job exams. As vacancies are few and aspirants are many, only a minuscule number of candidates can get through these exams.
Apart from that Government Job vacancies have also dwindled in recent years. So, be it MPSC, UPSC, or any other Govt. job exam every aspirant needs experts’ guidance with some sort of motivation.
Civilsdaily’s Mentorship Students are today’s UPSC Rankers
Success is nothing but more than a few simple disciplines practiced every day
Amol Murkut, IPS
The journey to the final job offer is very long, especially in today’s time. Have you ever thought about what you would do if finally you find that you faced only failure? What will be the consequences if you choose any other profession just leaving Govt job preparation? Can you easily succeed soon?
Make hay while the sun shines, the proverb means that we must not let any opportunity slip, but make prompt and full use of it whenever it comes.
Opportunities do not always come. If we miss one opportunity, we may miss it forever and suffer consequences. Therefore, we must always take full and prompt advantage of any opportunity that may come our way.
Acknowledging the need for the removal difficulties of Freshers/unsuccessful students, Dr. Amol Murkut, IPS officer and Super mentor in Civilsdaily is conducting a need of the hour Career guidance session on how to prepare for government competitive exams including MPSC and UPSC. Registration is absolutely free.
Post-seminar CivilsDaily will share a special Preparatory Package both for UPSC & MPSC candidates.
You are also entitled to a personalized intensive mentorship session by a senior IAS mentor wherein you can avail of a personalized study plan, schedule, and doubt resolution session.
A UPSC/MPSC beginner – confused about the syllabus, prioritizing subjects, making timetables & targets, or just getting started.
A working professionalor college student who will be attempting UPSC 2023 with a job. Facing a serious time crunch and mismanagement in UPSC preparation.
A veteran or aspirant trying to improve your rank in UPSC 2023 attempt.
Strategic planning will help you fully uncover your options, set priorities for them, and define the methods to achieve them.
This is going to be an interactive 1-1 session with Senior mentors and an IPS officer. You will get ample time and opportunity to discuss this with Amol sir. These points will be discussed.
1. What is the basic but mostly required strategy to crack any Government job is your first attempt? How to make a plan for the day. Day-to-day time management.
2. Dealing with negative emotions such as despair and stress. How did Soham study when he was feeling down?
3. His sources for current events, and strategy
4. Should an aspirant participate in a study group and prepare? Soham responds.
6. What practices did Soham altogether avoid what was popular among other aspirants?
7. What shall be the macro plan for the next coming months
8. Revision Cycle strategy
9. Different approach of Prelims and mains and Integrated Preparation of both for MPSC and UPSC – 2023, 24.
10. Answer Writing Strategy
11. Importance of hobby
12. Essay approach: what things work.
13. How toppers prioritize momentum mover content and content over structure. ‘How to fix your static answer writing structure, improved with the current affairs?
14. Whether your answers ought to reflect the editorial standards of The Hindu! What should be the foolproof strategy of note-making from current affairs? What points ought to be included in your notes?
15. How to create a basic conceptual framework of the current affairs answer before committing anything to paper. Implications of overstretching your imagination.
16. What is the difference between ‘Opinion-based current affairs’ & ‘Current issues with Fact-based’ questions will also be discussed thoroughly in this webinar.
17. How to enhance writing patterns, where to take mock regularly, and how many mock tests are optimal?
Recently, Maharashtra Tourism Minister Mangal Lodha triggered a controversy by equating Chhatrapati Shivaji Maharaj’s legendary Agra escape to Chief Minister Eknath Shinde’s defection from the Uddhav Thackeray-led camp in Maharashtra. His comments drew sharp criticism from political parties and other organisations that venerate Shivaji as a Maratha icon, with no parallel in the past or present.
Brief Political background of the issue
Eknath Shinde’s “revolt” against party leadership and CM Uddhav Thackeray in June this year led to the fall of the coalition government of the Shiv Sena, NCP, and the Congress. He has since taken the reins of Maharashtra as its CM.
Who was Chhattrapati Shivaji Maharaj?
Chhatrapati Shivaji Maharaj (1630-1680): He was born on 19th February, 1630 at Shivneri Fort in District Pune in the present-day state of Maharashtra. He was born to a general Shahaji raje who served different Deccan Sultans over the course of his life and Jijabai, as known to be an influential and determined woman who was an embodiment of self-respect and virtue.
Founder of an Independent Maratha kingdom: Shivaji Maharaj was keen on expanding his father’s fiefdom of modern-day Pune into an independent Maratha state. He carved out an independent Maratha kingdom from various Deccan states in the 17th century. At the time of his death, he held around 300 forts over an area that stretched across the Konkan coast, from Surat to near Goa, and was overlooked by the strategic Western Ghats.
Contemporary kingdoms and power struggle: At this point of time, several Sultanates (mainly Bijapur, Golkonda and Ahmadnagar) and the Mughals were vying for the control of the Deccan. As Mughal power grew, these Sultanates would become tributaries to the Mughal Empire (while often continuing to bicker among themselves) with the rulers and ruling clans being given positions in the Mughal court.
Lifetime conflicts and fights for Swaraj: His conflict with the Adil Shahi Sultanate of Bijapur began when he was only 16. He would spend the rest of his life fighting various opponents, and in the process, laying the foundation for the Maratha Empire which would stretch across large parts of the Indian subcontinent and rule till the 19th Century.
Importance of forts in his times: Early in his life, he realised that the key to holding power in the Deccan (or for that matter, many places in India in that era) was to capture and hold important forts. Thus, his strategies would be centred around taking control of forts in strategic locations, often on hilltops. He also repaired and built new forts as his sphere of control increased.
An inspiration to fight against the colonial rule: Shivaji remained a Maratha folk legend until two centuries after his death. It was the British Raj and the subsequent anti-colonial movement that marked his increasing stature in history and as a pan Indian hero.
From a folk hero to a Pan India hero: Nationalist historians saw him as an example of an local Indian ruler who was able to successfully resist and defeat the powerful and oppressive “outsiders” (Muslim rulers, including both Mughals and the Deccan Sultans). Thus, Shivaji rose from being a folk hero to a nationalist icon, seen as a proto-nationalist himself.
Tales of his bravery and just rule used to infuse motivation: Tales of his bravery were told to galvanise a population that was enduring emasculation and injustices under its British overlords. Over the 19th and 20th centuries, the narrative around Shivaji Maharaj emphasised on both his military heroism and his just rule.
Shivaji Maharaj and the Mughals
Meteoric rise: Shivaji Maharaj’s meteoric rise posed challenges to the suzerainty of the Mughals. His first direct encounter with the Mughals was during Aurangzeb’s Deccan campaigns of the 1650s. As Aurangzeb went North to fight for the Mughal throne, Shivaji Maharaj was able to seize further territory.
Swift and smart warfare tactics beyond understanding of the Mughals: His tactics against the Mughals were adapted to the specific nature of his force and the flabby Mughal armies. Using swift cavalry attacks, he would raid and pillage Mughal strongholds. While on the rare occasion he would engage in battle to actually capture and hold Mughal positions, most often, he would simply cause much menace, raid the treasury, and leave with the Mughals in terror and disarray.
Well know Seize of Surat: Famously, in 1664, he attacked the port of Surat (now in Gujarat) and plundered one of the richest and busiest commercial towns of Mughal India while the local governor hid in a nearby fort.
Posed a greatest challenge to Aurangzeb and subsequent treaty of Purandar: As the legend of Shivaji and the physical sphere of his influence grew, Aurangzeb sent a 100,000-strong, well-equipped army under Raja Jai Singh I to subdue him in 1665. After putting up a valiant fight, Shivaji was besieged in the Purandar hill fort.
The chronology of the great escape
Taken to Agra after purandar treaty: He was taken to Aurangzeb’s court in Agra in 1666. He presented Aurangzeb with various gifts, but he felt slighted at the treatment he received in return, and made his displeasure clear in open court.
Kept under strict House arrest: Aurangzeb put him under house arrest in Agra. Far away from home and help, Shivaji realised he needed to escape to save himself and his territories. He began to plot a plan to return home and keep up his fight against the Mughals.
The perfect plan of escape: The story of Shivaji’s subsequent escape is now part of common lore. The popularly told story involves an elaborate plan, under which he began daily distribution of alms to brahmans. The alms would be sent from his home in Agra in large, covered baskets.
The final escape right under the nose of Mughals: After some time, the Mughal guards became lax about checking the contents of the baskets that daily left his house. One day, Shivaji slipped into one of the baskets, and put his young son, Sambhaji, in another basket. It was in these covered baskets that Shivaji and his son left Agra, right under the noses of the Mughals.
Smart and swift movement in disguise from the Mughal territory: From there, he would traverse across Mughal territory, living incognito until he reached the safer lands closer to home. Some versions of this story say that he took the disguise of a wandering ascetic while others say he had a number of different disguises. His exact path is not known, though folktales and songs memorialising Shivaji often mention different towns and places he crossed.
Embarrassed Aurangzeb regarded him as a king: Aurangzeb was livid and embarrassed. But he chose not to start an immediate conflict with Shivaji again. Instead, he offered Shivaji the title of Raja and guaranteed his authority in the Maratha lands as long as he acknowledged the supremacy of the Mughals and maintained truce.
Coronation of Shivaji Maharaj to Chhatrapati and the ideal rule
By 1669, Shivaji had regrouped and raised an effective army. Using his old guerilla tactics, he would swiftly descend into static Mughal and Bijapuri strongholds, looting and pillaging the shocked Mughals.
During this time, Aurangzeb was occupied with Pathan revolts in the North-West corner of his Empire. Shivaji deftly regained his lost positions in the Konkan coast. In 1674, he crowned himself Chhatrapati, officially creating an independent Maratha kingdom.
The next six years were spent expanding his rule and forging new political norms, replacing the prevailing Indo-Persian court culture. He promoted the use of Marathi and Sanskrit in his courts and created an elaborate administrative system with a council of ministers known as “Ashta Pradhan.”
Conclusion
Chhatrapati Shivaji Maharaj is not just a name or a person but to many he is an idea, a life and inspiration for today and tomorrow, which has no parallel in the past or the present.
Protection of the Swarajya and welfare of his subjects were the motives that pushed Shivaji Maharaj to escape from Agra. Comparing his love for his subjects with the political exigencies and manoeuvers of present-day politicians will be an injustice to the astuteness of Chhatrapati Shivaji Maharaj.
Mains question
Q. Chhatrapati Shivaji Maharaj is considered as the king of the people; Discuss how he is remembered today and what qualities make him stand tall and different from those of the past and present?
India’s ‘Look East’ and ‘Act East’ policies have moved into the phase of Indo-Pacific policy and strategy. But what we in the national capital interpret as the ‘Indo-Pacific’ is different from the perceptions of this policy in North-eastern and eastern India.
What is Indo-pacific?
The Indo-Pacific is geographic region interpreted differently by different countries.
For India, the geography of the Indo-Pacific stretches from the eastern coast of Africa to Oceania whereas, for US, it extends up to the west coast of India which is also the geographic boundary of the US Indo-Pacific command.
Importance of North-East
Security of India: The Northeast which comprises seven ‘sisters’ or States and one ‘brother’, Sikkim, has been witnessing transformation as it heads towards better security conditions and development
Geography and Biodiversity: North-eastern Indian States are blessed with a wide range of physiographic and ecoclimatic conditions and the geographical ‘gateway’ for much of India’s endemic flora and fauna.
Siliguri corridor only connecting link: North-East is home to 3.8% of the national population and occupies about 8% of India’s total geographical area. Siliguri corridor, a narrow strip of land in West Bengal, popularly known as “chicken’s neck” connects this region to the rest of mainland India.
Present condition of north east
Improved security: Security conditions have improved significantly since 2017. However, the core issues behind the insurgency have remained unresolved.
Serious non-traditional threats: A notable contrast in security assessments of the authorities and others came to the fore. The official perspective was that the pernicious phenomena of smuggling, drug trafficking, transnational border crime, insurgent activity, and the influx of refugees (from Myanmar) represented serious non-traditional threats.
Chinese hand in nefarious activities: China was viewed as a ‘constant player’ behind these nefarious activities. This has necessitated vigilance and strict action by the Assam Rifles and other security agencies.
Sensitive border management: The insensitive handling of those engaged in lawful exchanges with the neighbouring countries. A balanced view indicates that considerable scope exists for more effective and people-sensitive border management in the future.
Development as priority in North East
Rising road infrastructure: The Northeast is on the right path to concentrate on economic development. More is awaited through improvement in roads linking north-eastern towns and job creation for thousands of graduates produced by local universities.
Hub of medical tourism: Manipur needs to be promoted as the hub of medical tourism for other Indian States and neighbours such as Myanmar.
Investment needs to increase: The State’s research and development facilities to leverage the region’s biodiversity should be expanded. Accelerated development requires increased investment by Indian corporates and foreign investors as well as better management.
Blueprint for economic development: Strategic and business community to contribute to crafting a concrete blueprint for leveraging opportunities relating to commerce, connectivity, and human capital development.
Cultural diplomacy from North east
Showcasing the culture of north east: An ambitious endeavour by 75 artists from nine countries highlighted the region’s ‘unity in diversity’ through music, dance, drama, and cuisine.
Education, tourism and trade: Clearly, expanding the reach of cultural diplomacy and people-to-people cooperation through greater educational exchanges, tourism, and trade is desirable.
Regional cooperation through cultural exchange: Harsh Vardhan Shringla, former Foreign Secretary, aptly stressed that the “shared culture, history and mutual social threads that tie the region with India also an important component towards fostering regional cooperation”.
Geo-cultural dimension: At Kolkata, intellectuals and performers in the cultural domain from India, the U.S., Japan, Thailand, Sri Lanka, and Bangladesh reflected on the Indo-Pacific construct’s cultural dimensions. Moving beyond geopolitics and geo-economics, neighbors should focus on “the geo-cultural dimension” of the Indo-Pacific.
Expanding people to people cooperation: Diplomats from the region agree on the importance of expanded people-related cooperation which would lead to wider acceptance of the Indo-Pacific and consolidation of the Quad.
Conclusion
While implementing India’s Indo-Pacific strategy, voices from Northeast and eastern India must be heard. Thus, beyond ‘Look East’ and ‘Act East’ lies ‘Think and Relate East’, especially within our own country.
The Reserve Bank of India (RBI) has launched the first pilot of the retail digital rupee, also known as e₹-R, on December 1, 2022. The digital token that represents legal tender will be issued in the same denominations as paper currency and coins. The RBI’s pilot on the digital rupee will test the robustness of the new system. Let’s understand it in detail.
The first pilot project of retail digital rupee
Allowed banks: Initially, only four banks- State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank in four cities have been allowed to offer e₹-R. The scope of the pilot will be increased gradually to include more banks, users and locations.
Transaction: People will get e₹-R from banks and will be able to make transactions via their digital wallets. The digital rupee can be stored on mobile phones or devices.
Like fiat currency in digital form: CBDC is a legal tender issued by the central bank in digital form. Like rupee notes or coins, which are in physical form. Like fiat currency, it can also be exchanged between people. Simply, put it’s just like rupee (₹) notes but in digital form (e₹). You can also exchange e₹ for physical currency notes.
Unlike fiat currency no need to have account: However, unlike fiat currency that’s usually stored in banks and hence their liability, CBDC is a liability on the RBI’s balance sheet. That’s why you don’t necessarily need to have a bank account to own a digital rupee.
Why do we need CBDC?
Cost efficient management: CBDC will cut the cost related to physical cash management. India spent ₹4,984.80 crore on printing money in FY22 and ₹4,012.10 crore a year before that. These expenses are borne by people, businesses, banks and the RBI. e₹ cuts all kinds of printing, storage, transportation and replacement and settlement costs. Though the RBI will invest a significant amount in building CBDC infrastructure, subsequent marginal operating costs will be very low.
Boost to digital economy and financial inclusion: It’ll fulfil the higher cash requirement of the country. The government will be able to make money available in areas where it’s a challenge to provide physical cash. Also, it’ll boost India’s digital economy, enhance financial inclusion, and make the financial system efficient.
People will have money in uncertain times: Since e₹ is the central bank money, in any uncertain situation like COVID-19, it’ll save people’s savings. Banks only insure deposits up to Rs 5 lakh. In case of defaults, people could lose their savings.
Multiple saving and transaction options: e₹ will provide you with other options like e-wallets, mobile banking, and UPI to make payments.
Much safer payment option: e₹ is a safe central bank instrument, with direct access to the RBI money for payment and settlement. It is an electronic version of cash, whose main use case is retail
Will CBDC replace UPI?
Not expected to substitute but supplement payment option: The CBDC-based payment system is not expected to substitute other modes of existing payment options. It will supplement by providing another payment avenue to people.
India already has a sound payment system: UPI uses your money deposited with banks but with CBDC, the money becomes the liability of RBI India already has a sound payment system, with payment products like RTGS, NEFT and UPI, etc., coupled with an exponential increase in digital transactions.
No interest on e₹? but why?
No interest on digital money: According to the RBI, if it starts paying interest on digital money, it could lead to a massive disintermediation in the financial system, in which banks will lose deposits, and thus hurt their credit creation capacity in the economy.
Rationale behind No interest on digital rupee: Banks may be compelled to increase deposit rates, which will increase their costs of funding and decrease net interest income. Ultimately, the cost will be passed on to borrowers.
CBDC will be attractive payment option without interest: If there is no interest, CBDC can still be attractive as a medium of payment, even while its attractiveness as a savings instrument diminishes. Also, banks would restrain themselves from distributing CBDCs if they find it as a threat to bank deposits, which can hamper credit flows and the adoption of CBDCs.
How will CBDC be different from crypto?
CBDC is Algorithm based unlike crypto mining: The central bank will be issuing CBDCs based on algorithm-driven processes, rather than mining through competitive reward methods. These algorithms will have energy efficiency and environmental friendliness as their core principles, unlike private crypto mining.
Less energy consumption unlike crypto: Therefore, issuance and management of CBDCs are expected to have much lesser energy consumption vis-à-vis more energy-intensive processes normally associated with the mining and distribution of private cryptocurrencies.
Legal consumer protection: Unlike private cryptos wherein any individual can compete to mine and create the cryptocurrency, only the central bank can issue the CBDC and can simply opt for conversion of the bank’s existing balances to CBDC balances. So, CBDCs will provide the public with the benefits of virtual currencies, while ensuring consumer protection by avoiding the damaging social and economic consequences of private virtual currencies.
Why India needs a digital rupee?
Online transactions: India is a leader in digital payments, but cash remains dominant for small-value transactions.
High currency in circulation: India has a fairly high currency-to-GDP ratio.
Cost of currency management: An official digital currency would reduce the cost of currency management while enabling real-time payments without any inter-bank settlement.
Conclusion
e₹-R is a digital token that has real value like rupee notes or coins. CBDC will make transactions and currency exchange smoother, and it’ll boost financial inclusion. The RBI’s pilot on the digital rupee will test the robustness of the new system.
Mains question
Q. What is central bank digital currency? Why do we need CBDC? It is said that digital rupee is different from crypto currency. Discuss.
A report titled ‘Carbon Capture, Utilisation, and Storage (CCUS) Policy Framework and its Deployment Mechanism in India’ has been released by NITI Aayog.
The report explores the importance of technology as an emission reduction strategy to achieve deep decarbonization from the hard-to-abate sectors. This edition of Burning Issue will highlight the key aspects of this report.
What is CCUS?
The International Energy Agency (IEA) defines Carbon Capture, Utilization and Storage (CCUS) as a group of technologies for capturing CO2 from large and stationary CO2 emitting sources, such as fossil fuel-based power plants and other industries.
CCUS also involves the transport of the captured CO2 (typically by pipeline and in certain situations through shipping, rail or trucks also) to sites, either for utilization in different applications or injection into geological formations or depleted oil & gas fields for permanent storage and trapping of the CO2.
Significance of CCUS technologies
CCUS can contribute to decarbonization and transition to clean energy systems in various ways:
Hard-to-abate sectors: CCUS offers the only known technology for the decarbonization of hard-to-electrify CO2-intensive sectors such as steel, cement, oil & gas, petrochemicals & chemicals, and fertilizers.
Creation Low carbon hydrogen economy: CCUS is expected to play a major role in enabling the hydrogen economy in India, through the production of blue hydrogen based on the utilization of our rich endowments of coal.
Removal of the CO2 stock from the atmosphere: The race towards net zero and containing global temperature within 1.5 degrees from pre-industrial levels is not possible without the removal of excess CO2 from the atmosphere through Direct Air Capture (DAC).
Sustenance of existing emitters: Existing thermal power plants and industrial plants (such as steel and cement production facilities) can be retrofitted with CO2 capture infrastructure.
Need for CCUS in India
Growing CO2 emissions: India is the 3rd largest emitter of CO2 in the world after China and the US, with estimated emissions of 2.6 gigatonnes per annum (gtpa) in 2019. With rapid economic growth, infrastructure and industrial development, as well as a growing population, the total CO2 emissions are expected to cross 4 gtpa by the year 2030.
Sustainable solutions for the decarbonization of sectors -The decarbonization challenge for India is to identify scalable and economically sustainable solutions for the decarbonization of sectors that contribute to 70% of emissions. CCUS has a critical role to play, especially for India to accomplish net zero by 2070.
Enabling clean and green energy generation: CCUS also has a role to play in enabling clean and green baseload power and ensuring the sustenance and non-stranding of our over 210 GW of coal and lignite-based thermal power plants.
Limit global temperature rise- The International Energy Agency points out that reaching net zero without CCUS is virtually impossible. The Intergovernmental Panel on Climate Change (IPCC) also concludes that without CCUS, it would not be possible to stabilize the CO2 concentration in the atmosphere between 450 – 750 ppmv (parts per million by volume) and limit global temperature rise between 1.5 to 2 degrees Celsius above pre-industrial levels.
Fulfill commitments of the Paris Agreement and ‘Panchamrit Strategy’-As a signatory of the Paris Agreement 2015, India has committed to reducing emissions by 50% by the year 2050 and reaching net zero by 2070. Given the sectoral composition and sources of CO2 emissions in India, CCUS will have an important and integral role to play in ensuring India meets its stated climate goals, through the deep decarbonization of energy and CO2 emission-intensive industries such as thermal power generation, steel, cement, oil & gas refining, and petrochemicals.
Enabling sunrise sectors- CCUS can enable the production of clean products while utilizing our rich endowments of coal, reducing imports and thus leading to a strong Indian economy. CCUS also has an important role to play in enabling sunrise sectors such as coal gasification and the nascent hydrogen economy in India.
Current usage of CCUS in India
Presently carbon capture in India is confined to certain industries/applications where carbon capture is part of the process, viz., the manufacture of urea. India’s urea production is about 24 mtpa, where captured CO2 is utilized in the ammonia-to urea conversion process.
CO2 is also captured as part of the gas conditioning process in the gasifiers of Reliance Industries Limited in Jamnagar (10 mtpa of petcoke gasification capacity) and JSPL in Angul (2 mtpa of coal gasification capacity), but the CO2 is largely released to the atmosphere and not utilized or stored.
While there are few pilot-scale carbon capture projects (viz. IOCL R&D’s amine and biological enzyme-based carbon capture plant and Tata Steel Jamshedpur’s pilot-scale carbon capture plant for capturing 5 tonnes per day CO2 from Blast Furnace gases), there are no commercial-scale dedicated CCUS projects in India.
Carbon Capture and Storage Technologies
CO2 capture technologies separate carbon dioxide from gas streams that are released from industrial processes such as power plants, chemical production, cement production or steel making. There are three different broad categories of technologies for capturing CO2: Post-combustion capture, Pre-combustion and Oxy-fuel combustion.
Cryogenic separation for CO2 capture is similar to the conventional distillation process, except that it involves the separation of components from a gaseous mixture (instead of liquid) based on the difference in their boiling points.
In the adsorption-based CO2 capture process, the CO2 molecules selectively adhere to the surface of the adsorbent material and form a film. This is possible because of the difference in diffusivities and heat of adsorption values for the feed gas stream components.
Solvent-based CO2 capture processes have been used for over half a century for processing natural (sour) gas, combustion flue gas and Fischer-Tropsch (FT) synthesis products. The fundamental principle on which solvent-based CO2 capture technologies work is the ‘selective absorption’ of CO2 over the other gaseous constituents.
Microalgae-Based Carbon Capture– The basic philosophy behind the process of carbon capture by microalgae is the use of CO2 as a nutrient for the cultivation of microalgae. The selected strains of microalgae can be cultivated in ponds. The CO2 will be absorbed by the microalgae and the resulting gas will leave the cultivation system.
Utilization of the carbon captured
Green urea: Green urea can be produced from the captured CO 2 and cost-competitive green hydrogen, from renewable energy-based electrolysis of water. Green urea can replace/complement the traditional LNG/NG-based production and import of ammonia and urea.
Food and beverages applications: CO2 is utilized in F&B applications such as carbonated drinks, dry ice, and modified atmosphere packing; however, the scales are much lower compared to green urea.
Building materials (concrete and aggregates): There is a large market for aggregates and concrete in a developing country like India, providing a pathway for utilizing CO2 for producing building materials through concrete curing and aggregate formation. In these applications, CO2 is injected in a liquid state without any conversion, thus reducing energy requirements.
Chemicals (methanol and ethanol): Conversion of CO2 to methanol and ethanol from CO2 is proven at a commercial scale in different parts of the world.
Polymers (including bio-plastics): The conversion of CO2 to polymers presents another possible CO2 utilization route.
Storage of the carbon captured
Storage in oil wells– The injection of CO2 for Enhanced Oil Recovery has been studied and applied for years, especially in North America. CO2 is miscible with crude oil which helps in recovering oil not possible by secondary methods. This also helps in permanently storing CO2 in oil reservoirs, thus making CO2 EOR a sustainable option for abating CO2.
Storage in coal seams- The CO2 injected is accumulated in the coal cleats in a dense gas phase. This CO2 is adsorbed and absorbed in the coal. Since CO2 has a higher affinity for coal than CBM, it pushes the coal bed methane toward production wells, thus enhancing its primary recovery. Similar to CO2 EOR, ECBMR can help in permanently storing CO2 and the recovered methane can also help offset the cost of carbon capture.
Storage in Deep Saline Aquifers– Captured CO2 can be permanently stored in deep saline aquifers. Unlike EOR and ECBMR, injection of CO2 in deep saline aquifers has no economic benefit. Deep saline aquifers are spread across very large areas and thus have the potential to store very large quantities of CO2.
CO2 Storage in Basalts– Recently studies have been carried out to learn about the CO2 storage potential of basaltic rocks. Basaltic rock constitutes divalent cations of Ca, Mg, and Fe. They can react with the CO2 dissolved in water to form stable carbonate minerals and thus can offer a safe CO2 sequestration method for an extended period.
Policy framework for India
Key Risks Associated with CCUS
Technical Risks– such as Reservoir Suitability for CO2 Flooding for EOR and the extent of CO2 abatement possible through EOR depend on the comparative performance and cost-effectiveness of CO2.
Financial Risks– Cost of Capture The main cost driver in the CCUS value chain is the capture cost. In industrial processes such as natural gas processing and gasification, carbon capture is part of the process itself and hence there is no additional cost of carbon capture. However, in the case of thermal power plants and other industrial processes, there are significant capital and cash costs, leading to financial risks for the entire CCUS value chain.
Loss of Storage Site– Complications during CO2 injection may lead to the stoppage of operations at CO2 storage sites. Although reservoir management should provide adequate warning of such occurrences, there are technical risks in Carbon Capture Utilization and Storage (CCUS) – Policy Framework and Deployment Mechanism in India CCUS Policy Framework for India estimating/predicting the final capacity of a new storage site with certainty.
Promoting the Adoption of CCUS Technologies in India: The Way Forward
The envisaged CCUS policy needs to adopt a multi-pronged approach to promote the adoption of CCUS technologies in India. The key elements of the approach need to incentivize the following: i) Technology transfer:
Technology transfer, Assimilation and Adoption– Carbon capture, CO2 sequestration and CO2 EOR technologies are already demonstrated at a commercial scale in different parts of the world and particularly in the US for nearly 50 years. Hence the focus for India should be on technology transfer, assimilation and adoption of such proven technologies (TRL 8 and 9), rather than reinventing the wheel.
Promoting R&D in novel technologies: While carbon capture technologies and technologies for CO2 EOR and sequestration are well developed and implemented at a commercial scale, technologies for the utilization of CO2 are relatively less developed.
Private sector participation: Private sector participation is quintessential to promote the transfer and commercialization of existing CCUS technologies and also push the envelope for the development of new and emerging technologies in both capture and utilization.
Carbon Capture Finance Corporation (CCFC)– It is proposed that the Government of India set up a financial institution for the promotion and development of CCUS projects in India. The financial institution, which can be called the “Carbon Capture Finance Corporation (CCFC)” shall provide tax and cash credits for carbon capture projects in India.
Promoting Coal Gasification Projects with CCUS-Coal gasification (with CCUS) is an important and strategic sector for ensuring the future energy and materials security of India and reducing import-dependence for critical chemicals and commodities. It is recommended to set up a special purpose organization to drive and promote coal gasification in India, including the production of blue hydrogen to enable the hydrogen economy.
Conclusion
Carbon Capture Utilization and Storage (CCUS) has an important and critical role to play for India to halve CO2 emissions by 2050 and accomplish net zero by 2070.
Energy transitions take decades and hence it is important to implement the framework and policy instruments for CCUS to become a reality in India and make a meaningful contribution to decarbonization in India.
The Supreme Court has said that it had become a “fashion” for its former judges to comment on earlier decisions of the Collegium when they were part of it while adding that the apex court was the “most transparent institution”.
What is Collegium System?
The Collegium of judges is the Indian Supreme Court’s invention.
It does not figure in the Constitution, which says judges of the Supreme Court and High Courts are appointed by the President and speaks of a process of consultation.
In effect, it is a system under which judges are appointed by an institution comprising judges.
After some judges were superseded in the appointment of the CJI in the 1970s, and attempts made subsequently to effect a mass transfer of High Court judges across the country.
Hence there was a perception that the independence of the judiciary was under threat. This resulted in a series of cases over the years.
Evolution: The Judges Cases
First Judges Case (1981) ruled that the “consultation” with the CJI in the matter of appointments must be full and effective.
However, it rejected the idea that the CJI’s opinion, albeit carrying great weight, should have primacy.
Second Judges Case (1993) introduced the Collegium system, holding that “consultation” really meant “concurrence”.
It added that it was not the CJI’s individual opinion, but an institutional opinion formed in consultation with the two senior-most judges in the Supreme Court.
Third Judges Case (1998): On a Presidential Reference for its opinion, the Supreme Court, in the Third Judges Case (1998) expanded the Collegium to a five-member body, comprising the CJI and four of his senior-most colleagues.
The procedure followed by the Collegium
Appointment of CJI
The President of India appoints the CJI and the other SC judges.
As far as the CJI is concerned, the outgoing CJI recommends his successor.
In practice, it has been strictly by seniority ever since the supersession controversy of the 1970s.
The Union Law Minister forwards the recommendation to the PM who, in turn, advises the President.
Other SC Judges
For other judges of the top court, the proposal is initiated by the CJI.
The CJI consults the rest of the Collegium members, as well as the senior-most judge of the court hailing from the High Court to which the recommended person belongs.
The consultees must record their opinions in writing and it should form part of the file.
The Collegium sends the recommendation to the Law Minister, who forwards it to the Prime Minister to advise the President.
For High Courts
The CJs of High Courts are appointed as per the policy of having Chief Justices from outside the respective States. The Collegium takes the call on the elevation.
High Court judges are recommended by a Collegium comprising the CJI and two senior-most judges.
The proposal, however, is initiated by the Chief Justice of the High Court concerned in consultation with two senior-most colleagues.
The recommendation is sent to the Chief Minister, who advises the Governor to send the proposal to the Union Law Minister.
Does the Collegium recommend transfers too?
Yes, the Collegium also recommends the transfer of Chief Justices and other judges.
Article 222 of the Constitution provides for the transfer of a judge from one High Court to another.
When a CJ is transferred, a replacement must also be simultaneously found for the High Court concerned. There can be an acting CJ in a High Court for not more than a month.
In matters of transfers, the opinion of the CJI “is determinative”, and the consent of the judge concerned is not required.
However, the CJI should take into account the views of the CJ of the High Court concerned and the views of one or more SC judges who are in a position to do so.
All transfers must be made in the public interest, that is, “for the betterment of the administration of justice”.
Loopholes in the Collegium system
Lack of Transparency: Opaqueness and a lack of transparency, and the scope for nepotism are cited often.
Judges appointing Judge: The attempt made to replace it with a ‘National Judicial Appointments Commission’ was struck down by the court in 2015 on the ground that it posed a threat to the independence of the judiciary.
Criteria: Some do not believe in full disclosure of reasons for transfers, as it may make lawyers in the destination court chary of the transferred judge.
Way ahead
In respect of appointments, there has been an acknowledgment that the “zone of consideration” must be expanded to avoid criticism that many appointees hail from families of retired judges.
The status of a proposed new memorandum of procedure, to infuse greater accountability, is also unclear.
Even the majority opinions admitted the need for transparency, now Collegiums’ resolutions are now posted online, but reasons are not given.
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