💥Join UPSC 2027,2028 Mentorship (July Batch) + XFactor Notes & Microthemes PDF
Talk to Mentor

Civilsdaily

Login

Subject: Economics

  • Fertility Levels drop below one in many Asian Nations

    Why in the News? 

    Many countries in East and Southeast Asia are in the middle of a population crisis, with fewer births every year and record-low fertility rates.

    • In March this year, several hospitals in China stopped offering newborn delivery services due to declining demand.

    What is TFR? 

    Total Fertility Rate is a measure used in demography to represent the average number of children that would be born to a woman over her lifetime.

    TFR of Asian countries and India and Comparison with others: 

    Reasons behind the Fertility levels dropping below one in many Asian nations:

    • Family Planning Measures: Countries like South Korea and Singapore have implemented stringent family planning policies, limiting the number of children couples are encouraged to have. For example, South Korea’s slogan in the 1980s, “Even two children per family are too many for our crowded country,” reflects the emphasis on controlling population growth.
    • Career Opportunities for Women: With more opportunities for women to pursue careers, there has been a shift in priorities away from having children.
    • Declining Marriage Rates: Dropping marriage rates contribute to lower fertility rates, as marriage traditionally correlates with childbearing. As fewer people get married or delay marriage, the window for childbearing narrows.
    • Cost of Raising Children: The rising cost of raising a child is cited as a deterrent to having larger families. Financial considerations such as education, healthcare, and housing expenses may dissuade couples from having more children.
    • Ideal fertility rate: The ideal fertility rate for a population to remain stable, assuming no immigration or emigration, is 2.1 children per woman. This rate is known as the replacement rate, and it ensures that each generation will replace itself.

    Suggestive Measures to maintain an ideal Fertility Rate:

    • Supporting Work-Life Balance: Implement policies that support work-life balance, such as flexible work schedules, parental leave, and affordable childcare, to encourage individuals to have children while pursuing their careers.
    • Financial Incentives: Offer financial incentives or subsidies for families to alleviate the financial burden of raising children, making it more feasible for individuals to start families.
    • Education and Awareness: Provide education and awareness programs on the benefits of having children at a younger age and the importance of family planning to help individuals make informed decisions about their fertility.
    • Healthcare Support: Improve healthcare services related to fertility, pregnancy, and childbirth to ensure a safe and supportive environment for individuals considering starting a family.

    Conclusion: Declining fertility rates in Asian nations prompt a population crisis due to stringent family planning, women’s career opportunities, declining marriage rates, and high child-raising costs. Need to take measures include work-life balance policies, financial incentives, education, and healthcare improvements to maintain an ideal fertility rate.

     

    Mains PYQ  

    Q Critically examine whether growing population is the cause of poverty OR poverty is the mains cause of population increase in India.

  • [pib] Index of Industrial Production (IIP) grows by 5.7% in February, 2024

    Why in the news?

    India’s Index of Industrial Production (IIP) increased by 5.7% in February, up from 3.8% in January, according to data from the Ministry of Statistics and Programme Implementation (MoSPI).

    What is Index of Industrial Production (IIP)?

    • IIP as it is commonly called is an index that tracks overall manufacturing activity in different sectors of an economy.
    • It is currently calculated using 2011-2012 as the base year.
    • It is compiled and published by Central Statistical Organisation (CSO) every month.
    • CSO operates under the Ministry of Statistics and Programme Implementation (MoSPI).

    Components of IIP:

    • Three broad sectors in IIP:
    1. Manufacturing (77.6%),
    2. Mining (14.4%)
    3. Electricity (8%).
    • Electricity, crude oil, coal, cement, steel, refinery products, natural gas, and fertilizers are the eight core industries that comprise about 40 per cent of the weight of items included in the IIP.

    Basket of products:

    There are 6 sub-categories:

    1. Primary Goods (consisting of mining, electricity, fuels and fertilisers)
    2. Capital Goods (e.g. machinery items)
    3. Intermediate Goods (e.g. yarns, chemicals, semi-finished steel items, etc)
    4. Infrastructure Goods (e.g. paints, cement, cables, bricks and tiles, rail materials, etc)
    5. Consumer Durables (e.g. garments, telephones, passenger vehicles, etc)
    6. Consumer Non-durables (e.g. food items, medicines, toiletries, etc)

    Who uses IIP data?

    • The factory production data (IIP) is used by various government agencies such as the Ministry of Finance, the Reserve Bank of India (RBI), private firms and analysts, among others for analytical purposes.
    • The data is also used to compile the Gross Value Added (GVA) of the manufacturing sector in the Gross Domestic Product (GDP) on a quarterly basis.

    IIP base year change:

    • The base year was changed to 2011-12 from 2004-05 in the year 2017.
    • The earlier base years were 1937, 1946, 1951, 1956, 1960, 1970, 1980-81, 1993-94 and 2004-05.

    What are the Core Industries in India?

    • The main or the key industries constitute the core sectors of an economy.
    • In India, there are eight sectors that are considered the core sectors.
    • They are electricity, steel, refinery products, crude oil, coal, cement, natural gas and fertilizers.

    About Index of Eight Core Industries (ICI)  

    • The monthly Index of Eight Core Industries (ICI) is a production volume index.
    • ICI measures collective and individual performance of production in selected eight core industries: Coal (10%), Crude Oil (8.98%), Natural Gas (6.88%), Refinery Products (28.04%), Fertilizers (2.63%), Steel (17.92%), Cement (5.37%), and Electricity (20.18%).
    • Prior to the 2004-05 series six core industries namely Coal, Cement, Finished Steel, Electricity, Crude petroleum and Refinery products constituted the index basket.
    • Two more industries i.e. Fertilizer and Natural Gas were added to the index basket in 2004-05 series. The ICI series with base 2011-12 will continue to have eight core industries.

    Components covered in these eight industries for compilation of index are as follows:

    1. Coal – Coal Production excluding Coking coal.
    2. Crude Oil – Total Crude Oil Production.
    3. Natural Gas – Total Natural Gas Production.
    4. Refinery Products – Total Refinery Production (in terms of Crude Throughput).
    5. Fertilizer – Urea, Ammonium Sulphate (A/S), Calcium Ammonium Nitrate (CAN), Ammonium chloride (A/C), Diammonium Phosphate (DAP), Complex Grade Fertilizer and Single superphosphate (SSP).
    6. Steel – Production of Alloy and Non-Alloy Steel only.
    7. Cement – Production of Large Plants and Mini Plants.
    8. Electricity – Actual Electricity Generation of Thermal, Nuclear, Hydro, imports from Bhutan.

    How is IIP different from ICI?

    • IIP is compiled and published monthly by the National Statistics Office (NSO), Ministry of Statistics and Programme Implementation six weeks after the reference month ends.
    • However, ICI is compiled and released by Office of the Economic Adviser (OEA), Department of Industrial Policy & Promotion (DIPP), and Ministry of Commerce & Industry.
    • The Eight Core Industries comprise nearly 40.27% of the weight of items included in the Index of Industrial Production (IIP). These are Electricity, steel, refinery products, crude oil, coal, cement, natural gas and fertilisers.

    PYQ:

    [2015] In the Index of Eight Core Industries, which one of the following is given the highest weight?

    (a) Coal Production

    (b) Electricity generation

    (c) Fertilizer Production

    (d) Steel Production

  • India Initiates Review of Asean Trade Pact to Boost Domestic Manufacturing

    Why in the news?

    The review aims to address concerns such as the inverted duty structure, which puts local manufacturers at a disadvantage.

    Trade deficit issue with ASEAN 

    • High trade deficit: The trade deficit between India and the Association of Southeast Asian Nations (ASEAN) has been a significant issue, with the deficit widening to USD 43.57 billion in the last fiscal from USD 25.76 billion in 2021-22 and just USD 5 billion in 2010-11
    •  Review AITIGA:This has led to a review of the ASEAN-India Trade in Goods Agreement (AITIGA) by 2025, aiming to address concerns about trade barriers, abuse of the agreement, and the growing trade gap between India and the ASEAN region

    ASEAN-India Trade in Goods Agreement (AITIGA)

    • The ASEAN-India Trade in Goods Agreement (AITIGA) is a trade agreement between the ten member states of ASEAN and India, signed in 2009 and implemented in 2010. The agreement aims to establish a free trade area between the parties, covering trade in physical goods and products, and progressively eliminating duties on 76.4 percent of goods. 

    The trade deficit between India and the ASEAN region is primarily due to the following reasons:

    • Tariff disparities: India’s tariffs were much higher than partner countries, leading to a significant reduction in tariffs for partner countries, which in turn caused India’s imports to grow faster than exports. This imbalance has been widening since 2010-11, the year India entered into an agreement with ASEAN
    • Non-tariff barriers and regulations: India’s exports to ASEAN have been affected due to non-reciprocity in FTA concessions, non-tariff barriers, import regulations, and quotas. These factors have hindered India’s ability to fully benefit from the FTA
    • Routing of goods from third countries: There have been concerns about the routing of goods from third countries, such as China, to ASEAN countries with minimum value addition and then being imported into India, misusing the India-ASEAN FTA. This practice has contributed to the growing trade deficit
    • Limited market access for Indian products: India’s exports of products such as textile clothing, footwear, food products, and minerals don’t have a significant place in ASEAN imports, while there is a higher dependence on products such as vegetables, fuels, chemicals, and metals from ASEAN, which are essential commodities

     Conclusion 

    India’s review of the ASEAN-India Trade in Goods Agreement aims to tackle the widening trade deficit by addressing tariff disparities, non-tariff barriers, and the misuse of the agreement, crucial steps toward fostering fair and balanced trade relations.

    Mains question for practice 

    Q Discuss the factors contributing to high  deficit between India and ASEAN. 

     

  • Understanding perspectives: Farmers’ Protests raise divisive opinions

    Why in the news? 

    A recent survey conducted by CSDS-Lokniti aimed to gather opinions regarding the ongoing farmer protests.

    Opinion about the Farmer Protest:

    The major key demands of Farmers in India include:

    • On Minimum Support Price (MSP): Farmers demand a legal guarantee for MSP for crops, which is a crucial lifeline for farmers facing market uncertainties.
    • On Electricity Act 2020: Farmers are demanding the repeal of the Electricity Act 2020, which they believe will negatively impact their income.
    • On Compensation: Farmers are demanding compensation for farmers who died during the previous agitation in Lakhimpur Kheri.
    • Withdrawal of Cases: Farmers are demanding the withdrawal of cases registered against farmers during the 2020-21 agitation.

    Government Initiatives: 

    • Negotiations: The government has taken several steps to address the farmer agitation, including negotiations with protesting farmers, proposing the formation of a committee to provide statutory backing to the Minimum Support Price (MSP), and engaging in talks with farmer representatives.
    • Demands: Despite promises made to farmers in 2021, the government has not fully responded to their demands, leading to continued tensions and protests. The government’s reaction to the protest still appears to be focused on maintaining law and order rather than proactively addressing the underlying issues raised by the farmers

    Conclusion: The CSDS-Lokniti 2024 pre-poll survey highlights divisive opinions on farmer protests, citing demands for an MSP guarantee, repeal of the Electricity Act, and compensation for fatalities. Despite negotiations, unresolved grievances persist, indicating a need for proactive governmental action and dialogue

  • CDP-SURAKSHA Digital Platform for Horticulture Subsidies

    Why in the news?

    The government has introduced a new platform called CDP-SURAKSHA for disbursing subsidies to horticulture farmers under the Cluster Development Programme (CDP).

    India’s Horticulture Sector:

    • India’s horticulture sector contributes nearly 1/3rd to the agriculture GVA, making a substantial economic contribution.
    • The total production of horticulture crops has increased, from 240.53 million tonnes in 2010-11 to 334.60 million tonnes in 2020-21.

    What is CDP-SURAKSHA?

    • CDP-SURAKSHA is a digital platform acronym for “System for Unified Resource Allocation, Knowledge, and Secure Horticulture Assistance.”
    • It facilitates instant subsidy disbursal to farmers’ bank accounts using the e-RUPI voucher from the National Payments Corporation of India (NPCI).
    • It provides upfront subsidies during material purchase, and vendors receive payment only after farmers verify delivery.

    Key Features include database integration with PM-KISAN, cloud-based server space from NIC, UIDAI validation, eRUPI integration, LGD, content management system, geotagging, and geo-fencing.

    Operational Mechanism of CDP-SURAKSHA

    1. Farmer Interaction:
      • Farmers, vendors, implementing agencies (IA), cluster development agencies (CDAs), and National Horticulture Board (NHB) officials can access the platform.
      • Farmers can log in using their mobile number, place orders for planting material, and contribute their share of the cost.
    2. Subsidy Disbursement:
      • After raising the demand, farmers receive the subsidy amount automatically on the screen.
      • Upon paying their contribution, an e-RUPI voucher is generated and received by the vendor, who supplies the planting material.
      • Farmers verify the delivery through geo-tagged media, following which the IA releases payment to the vendor.

    Significance of e-RUPI

    • e-RUPI is a one-time payment mechanism redeemable without cards or digital payment apps, used for specific purposes.
    • It is shared with beneficiaries via SMS or QR code and accepted at merchants supporting e-RUPI.

    Old System vs. CDP-SURAKSHA:

    • Previously, farmers purchased planting materials independently and then approached officials for subsidy release.

    Cluster Development Program (CDP)

     

    • CDP, under National Horticulture Board (NHB), aims to leverage horticulture clusters’ geographical specialization for integrated development.
    • It is a Central Sector Scheme aimed at growing and developing identified horticulture clusters to make them globally competitive.
    • 55 clusters have been identified, with 12 selected for the pilot phase, covering 9 lakh hectares and 10 lakh farmers.
    • It provides government assistance based on cluster size—up to Rs 25 crore for mini clusters, Rs 50 crore for medium, and Rs 100 crore for mega clusters.

     

    PYQ:

    [2019]Among the agricultural commodities imported by India, which one of the following accounts for the highest imports in terms of value in the last five years?

    (a) Spices

    (b) Fresh fruits

    (c) Pulses

    (d) Vegetable oils

  • The ‘import restrictions’ on solar PV cells | Explained

    Context:

    The Finance Minister proposed the ₹19,500 crore PLI scheme in the Union Budget of 2022-23. 

    • This was to scale domestic manufacturing of the entire solar supply chain — from polysilicon to solar modules.
    • The government also introduced a steep 40% customs duty on PV modules and 25% on PV cells.

    BACK2BASICS

    What is the ALMM list?  

    • The Approved List of Models and Manufacturers (ALMM) is a list of models and manufacturers of solar photovoltaic (PV) modules approved by the Ministry of New and Renewable Energy (MNRE) in India.
    • Objective: The ALMM is used to ensure the quality of solar panels and the manufacturer’s reliability for government projects, government-assisted projects, projects under government schemes and programs, and open access and net-metering projects.
    • It is being re-implemented to boost domestic solar manufacturing against China’s dominance in the supply value chain of solar PV.

    Does India rely on Solar PV imports?

    • China’s Dominance in Imports: China is the leading supplier of solar cells and modules to India, accounting for a significant portion of India’s imports. As of January 2023-24, China accounted for 53% of India’s solar cell imports and 63% of solar PV module imports.
    • Manufacturing Capacity Disparity: China holds a dominant position in the manufacturing capacity for various components of solar panels, including polysilicon, wafers, cells, and modules. Rating agency ICRA estimates that China commands over 80% of the manufacturing capacity in these areas.

    Government Initiatives:

    • Notification of ALMM Order: The government initiated efforts to address import dependency in the solar sector by notifying the Approved List of Models and Manufacturers (ALMM) order in January 2019.
    • Introduction of PLI Scheme: The Finance Ministry proposed the Production Linked Incentive (PLI) scheme worth ₹19,500 crore in the Union Budget of 2022-23. This scheme was designed to incentivize domestic manufacturing across the entire solar supply chain, ranging from polysilicon to solar modules.
    • Imposition of Customs Duties on PV Modules and Cells: To further incentivize domestic manufacturing and curb imports, the government introduced steep customs duties on photovoltaic (PV) modules and cells. Initially, a 40% customs duty was imposed on PV modules, and a 25% duty was imposed on PV cells.

    Why is China a leading exporter?

    • Cost-Competitive Manufacturing: China is recognized as the most cost-competitive location for manufacturing all components of the solar PV supply chain.
    • Low Cost of Power: The lower cost of power supplied to the solar PV industry significantly contributes to China’s competitiveness.
    • Growing Domestic Demand: The significant and rapidly growing domestic demand for solar PV products in China has played a crucial role in driving economies of scale.
    • Economies of Scale: China’s large-scale production capacity allows manufacturers to benefit from economies of scale.
    • Continuous Innovation: Chinese government support and the competitive market environment have fostered continuous innovation throughout the solar PV supply chain.

    Future scope for Solar Energy in India:

    • Ambitious Targets:  The target of achieving 500 GW of installed capacity from non-fossil fuels by 2030 underscores the significant role solar energy will play in India’s energy mix.
    • Fastest Growth Rate in Electricity Demand: India accounts for the fastest rate of growth in electricity demand among major economies, according to the International Energy Agency (IEA).
    • Abundant Solar Potential: India possesses abundant solar resources, with an estimated solar power potential of 748.99 GW.

    Conclusion: The ALMM list, PLI scheme, and customs duties aim to boost domestic solar manufacturing in India to counter China’s dominance. With ambitious targets, fast-growing electricity demand, and abundant solar potential, solar energy holds significant promise for India’s energy transition.

    Mains question for practice 

    Q Discuss the initiatives undertaken by the Indian government to promote domestic manufacturing in the solar sector, particularly in light of China’s dominance.

  • [pib] National Green Hydrogen Mission

    Why in the news?

    • The Ministry of New & Renewable Energy has unveiled Guidelines for the implementation of an R&D Scheme under the National Green Hydrogen Mission.
    • The scheme aims to catalyze advancements in the production, storage, transportation, and utilization of green hydrogen, with a focus on affordability, efficiency, safety, and reliability.

    Hydrogen Energy: A Backgrounder

    • Hydrogen is an important source of energy since it has zero carbon content and is a non-polluting source of energy in contrast to hydrocarbons that have net carbon content in the range of 75–85 per cent.
    • Hydrogen energy is expected to reduce carbon emissions that are set to jump by 1.5 billion tons in 2021.
    • It has the highest energy content by weight and lowest energy content by volume.
    • As per International Renewable Energy Agency (IRENA), Hydrogen shall make up 6 per cent of total energy consumption by 2050.
    • Hydrogen energy is currently at a nascent stage of development, but has considerable potential for aiding the process of energy transition from hydrocarbons to renewable.

    About National Green Hydrogen Mission (NGHM)

    • The National Green Hydrogen Mission was launched in January 2023 to make India a ‘global hub’ for using, producing and exporting green hydrogen.
    • Earlier, the National Hydrogen Mission was launched on August 15, 2021, with a view to cutting down carbon emissions and increasing the use of renewable sources of energy.
    • The Ministry of New and Renewable Energy (MNRE) formulates the scheme guidelines for implementation of these missions.

    Key features of the NGHM

    • Power capacity: The mission seeks to promote the development of green hydrogen production capacity of at least 5 MMT per annum with an associated renewable energy capacity addition of about 125 GW in the country by 2030.
    • Job creation: It envisages an investment of over ₹8 lakh crore and creation of over 6 lakh jobs by 2030.
    • Reducing energy import bill: It will also result in a cumulative reduction in fossil fuel imports of over ₹1 lakh crore and abatement of nearly 50 MMT of annual greenhouse gas emissions by 2030.
    • Export promotion: The mission will facilitate demand creation, production, utilisation and export of green hydrogen.
    • Incentivization: Under the Strategic Interventions for Green Hydrogen Transition Programme (SIGHT), two distinct financial incentive mechanisms targeting domestic manufacturing of electrolysers and production of green hydrogen will be provided under the mission.
    • Green Hydrogen Hubs: Regions capable of supporting large-scale production and/or utilisation of hydrogen will be identified and developed as Green Hydrogen Hubs.

    Types of Hydrogen

    Hydrogen extraction methods are classified into three types based on their processes: Grey, Blue, and Green.

    1. Green Hydrogen: Green hydrogen is produced through water electrolysis, utilizing electricity generated from renewable energy sources.
    2. Grey Hydrogen: This type of hydrogen is obtained through coal or lignite gasification (black or brown), or by steam methane reformation (SMR) of natural gas or methane (grey). These processes are typically carbon-intensive.
    3. Blue Hydrogen: Blue hydrogen is derived from natural gas or coal gasification, coupled with carbon capture storage (CCS) or carbon capture use (CCU) technologies to mitigate carbon emissions.

     

    PYQ:

    [2010]Hydrogen fuel cell vehicles produce one of the following as “exhaust”:

    (a) NH3

    (b) CH4

    (c) H2O

    (d) H2O2

     

    [2023]With reference to green hydrogen, consider the following statements:

    1. It can be used directly as a fuel for internal combustion.

    2. It can be blended with natural gas and used as fuel for heat or power generation.

    3. It can be used in the hydrogen fuel cell to run vehicles.

    How many of the above statements are correct?

    (a) Only one

    (b) Only two

    (c) All three

    (d) None

     

  • [9 April 2024] The Hindu Op-ed: Indian aviation, a case of air safety at a discount

    PYQ Relevance:

    Mains: 

    Q) Examine the development of Airports in India through joint ventures under Public – Private Partnership (PPP) model. What are the challenges faced by the authorities in this regard? (UPSC CSE 2017) 

    Q) International civil aviation laws provide all countries complete and exclusive sovereignty over the airspace above their territory. What do you understand by ‘airspace’ What are the implications of these laws on the space above this airspace? Discuss the challenges that this poses and suggest ways to contain the threat. (UPSC CSE 2014) 

    Note4Students: 

    Prelims: International Civil Aviation Organisation (ICAO);

    Mains: Economy and Infrastructure; Civil Aviation in India; 

    Mentor comments: To put in place long-term efforts for our safe and secure future, we must break down the barriers between ‘Development’ and ‘Humanitarian Response’. Air Transport plays a pivotal role in promoting Economy and Tourism in India. India has an extensive civilian air transportation network and is amongst the fastest-growing aviation markets in the world according to the International Air Transport Association (IATA). Presently, the Aviation Sector in India is facing serious safety concerns as Airline Management prioritizes commercial interests over passenger safety. 

    Let’s learn. 

    —

    Why in the News?

    The Civil Aviation Ministry and the DGCA need a more human-centric approach in airline management, addressing pilot shortages, and prioritizing safety over commercial interests is crucial for the Indian aviation sector to thrive.

    Challenges faced by Airline Services in India:

    • Technical and Safety Concerns: The safety of passengers is being gravely compromised due to the non-provision of the Runway End Safety Area. For example,  at Kozhikode’s Karipur Airport (Kerala).
      • Despite reassurances from the Civil Aviation Ministry and the DGCA, safety issues persist, such as the deferred regulations on pilot fatigue.
    • Resource Availability: The land resources needed by AAI [Airports Authority of India] for better landing and avoiding accidents are generally ignored or delayed by state governments.
    • Nexus between private players and government: Lack of Coordination between Airline owners and the Government for the implementation of safety policies needs to be resolved. For example, the present Flight Duty Time Limitations Regulations where the deadline for their implementation was June 1, 2024, were not taken seriously by private players.
    • Pilot Stress: Financial stress on pilots is also highlighted as a risk factor, with examples of past incidents linked to pilot suicide due to personal financial pressures.
      • Recognizing pilots as human beings who require time with their families, the importance of providing two days off per week for pilots is essential to ensure their well-being and maintain aviation safety.
    Global Scenario and System Overseas:

    The International Civil Aviation Organisation (ICAO) introduced the Fatigue Risk Management System (FRMS) as a mandatory requirement due to the significant impact of fatigue on aviation safety. 

    Studies have shown that sleep deprivation and impaired reaction times due to fatigue are major contributors to accidents and incidents. 

    Countries like Japan, Singapore, and the United Kingdom emphasize fatigue management and rest periods for flight crew to mitigate these risks. 

    Pilots in these countries typically have two days off every week to reset their body clock, especially after long-haul flights. 

    Way Forward:

    • Change the Priority: The Indian aviation sector faces critical safety issues due to a lack of prioritization of safety over commercial interests by airline management. The need for a more human-centric approach, addressing pilot shortages, and emphasizing safety is essential for the sector’s success.
    • Need for Humanitarian Code: India should adopt the ICAO Annex 1 Standard which allows experienced Indian pilots abroad to return to India and utilize the present retired pilots for training and checks. 
    • Need for Updating policy implementations: Overcoming corruption, revising outdated rules, and focusing on transparency and brand loyalty are crucial for the sector’s improvement and the success of airline mergers.

  • What is Consumer Confidence Survey?

    Why in the news?

    • The latest Consumer Confidence Survey conducted by the Reserve Bank of India in March 2024 reveals a significant boost in consumer confidence, particularly regarding future expectations.
    • It says consumer confidence has hit highest level in nearly 5 years.

    What is Consumer Confidence Survey (CCS)?

    • The RBI conducts a bi-monthly Consumer Confidence Survey to measure consumers’ perceptions of the prevailing economic situation.
    • It was started in 2015 with surveys in 13 major cities.
    • The survey is conducted across various cities and measures consumer confidence on parameters such as the economy, employment, price, income, and spending.
    • The survey consists of questions regarding consumers’ sentiments over various factors in the current situation and future.

    Here are a few parameters that help aggregate overall confidence:

    1. Spending: The consumer is asked about the willingness to spend on major consumer durables, purchasing vehicles, or real estate. This measures the overall spending scenario on necessities as well as luxuries for the next quarter.
    2. Employment: The consumer is asked about current and future ideas on employment situations, joblessness, job security, which reflects the sentiments of the current or expected employment in the country.
    3. Inflation: The consumer is asked about interest rates and levels of prices of all goods, tracking the price expected by consumers and their spending on basic necessities.

    Components of CCS:

    1. Current Situation Index (CSI): It measures overall consumer sentiment regarding the present economic situation.
    2. Future Expectations Index (FEI): It analyses consumer sentiment for the next 12 months.

    CSI and FEI are calculated based on people’s views about the economy, their income, spending, job opportunities, and prices compared to the previous year and expectations for the year ahead.

    Key Highlights of the recent report

    • Future Expectations Index (FEI) has climbed by 2.1 points to reach 125.2, marking its highest level since mid-2019, indicating heightened optimism among consumers for the year ahead.
    • Current Situation Index (CSI) has surged by 3.4 points to reach 98.5, marking its highest level since mid-2019.

    PYQ:

    [2018] As per the NSSO 70th Round “Situation Assessment Survey of Agricultural Households”, consider the following statements-

    1. Rajasthan has the highest percentage share of agricultural households among its rural households.

    2. Out of the total agricultural households in the country, a little over 60 percent belong to OBCs.

    3. In Kerala, a little over 60 percent of agricultural households reported to have received maximum income from sources other than agricultural activities.

    Which of the statements given above is/are correct?

    (a) 2 and 3 only

    (b) 2 only

    (c) 1 and 3 only

    (d) 1, 2 and 3

  • Imposition of Anti-Dumping Duty on Sodium Cyanide

    Why in the news?

    The Directorate General of Trade Remedies (DGTR) has recently recommended the imposition of an anti-dumping duty on sodium cyanide (NaCN) imported from China, the European Union, Japan, and Korea.

    Sodium Cyanide and Its Applications

    • Sodium cyanide is a deadly toxic, white, crystalline compound with the chemical formula NaCN.
    • It is a water-soluble solid, mainly used in gold mining, electroplating, and in the synthesis of organic chemicals.
    • It is hygroscopice. it quickly absorbs water from the air.
    • In gold mining, sodium cyanide is used to dissolve and separate gold from its ores.
    • It plays a pivotal role in various industrial processes, electroplating, metal heat treatment, and the production of insecticides, dyes, pigments, and pharmaceuticals.

    What is Anti-Dumping Duty?

    • An anti-dumping duty is a protectionist tariff that a domestic government imposes on foreign imports that it believes are priced below the price at which it is sold in the exporters’ domestic market.
    • This is imposed with the rationale that these products have the potential to undercut local businesses and the local economy.
    • The World Trade Organization (WTO) operates a set of international trade rules for the regulation of anti-dumping measures.
    • In general, the WTO agreement permits governments to act against dumping “if it causes or threatens material injury to an established industry in the territory of a contracting party.

    Anti-Dumping Mechanism in India:

    • The Anti-Dumping mechanism in India is administered by the Directorate General of Anti-Dumping and Allied Dutites (DGAD) under the Ministry of Finance.
    • The anti-dumping law in India is covered under the Customs Tariff Act, 1975, and the Customs Tariff Rules, 1995.
    • The DGAD conducts anti-dumping investigations to determine if the domestic industry has been hurt by a surge in below-cost imports.

    How is Anti-Dumping Duty calculated?

    • The anti-dumping duty is calculated as the difference between the normal value and the export value of the product.
    • The normal value is the market value of the product in the domestic market, while the export value is the price at which the product is exported to India.
    • The anti-dumping duty is imposed to offset the price difference and prevent the domestic industry from being harmed by cheap imports.

     

    PYQ:

    [2015] In India, the steel production industry requires the import of-

    (a) Saltpetre

    (b) Rock phosphate

    (c) Coking coal

    (d) All of the above