💥UPSC 2026, 2027, 2028 UAP Mentorship (March Batch) + Access XFactor Notes & Microthemes PDF

Type: IOCR

  • The Crisis In The Middle East

    Article 99 of the UN Charter

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Article 99

    Mains level: Read the attached story

    Central Idea

    • The UN General Secretary wrote under Article 99 about the escalating threats to peace and security due to the situation in Gaza.
    • He mentioned the human suffering, deaths, and destruction in Israel and the Occupied Palestine Territory, emphasizing the need for a humanitarian ceasefire.

    Understanding Article 99

    • Charter as an International Treaty: The UN Charter, the founding document of the United Nations, functions as an international treaty binding member states.
    • Article 99’s Provision: It allows the Secretary-General to bring any matter to the UNSC that may threaten international peace and security.
    • Discretionary Power: This article is seen as a discretionary power, requiring the Secretary-General to exercise political judgment, tact, and integrity.

    Historical Invocation of Article 99

    • Rare Usage: Article 99 has been seldom invoked, with notable instances including the Congo upheaval in 1960 and Tunisia’s complaint against France in 1961.
    • Current Context: It is indicated that Guterres’ invocation of Article 99 over Gaza is a significant constitutional move.
    • Details of the Crisis: He mentioned the human suffering, deaths, and destruction in Israel and the Occupied Palestine Territory, emphasizing the need for a humanitarian ceasefire.

    Potential Impact

    • Draft Resolution by UAE: Following Guterres’ letter, the United Arab Emirates submitted a draft resolution to the UNSC demanding an immediate ceasefire.
    • Voting Dynamics: For the resolution to pass, it requires at least nine votes in favor and no vetoes from the five permanent members.
    • Challenges in Reaching Consensus: The likelihood of unanimous support from permanent members is uncertain, given the US and Britain’s support for Israel’s military actions since October 7.

    Conclusion

    • Guterres’ appeal underscores the severity of the humanitarian crisis in Gaza.
    • The outcome of the UNSC’s actions, influenced by Guterres’ appeal, remains pivotal in addressing the ongoing conflict and humanitarian situation in Gaza.
  • Climate Change Negotiations – UNFCCC, COP, Other Conventions and Protocols

    Global Cooling Pledge at COP28 

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Global Cooling Pledge

    Mains level: NA

    Global Cooling Pledge

    Central Idea

    • At the COP28 climate summit on November 6, 63 countries, including the US, Canada, and Kenya, signed the world’s first pledge to reduce cooling emissions.

    Global Cooling Pledge

    • Term: This pledge aims to cut cooling emissions by at least 68% by 2050, addressing a significant source of greenhouse gases.
    • Current Contribution to Global Emissions: Cooling emissions, primarily from refrigerants and cooling energy, currently constitute 7% of global greenhouse gases.
    • Projected Increase: These emissions are expected to triple by 2050 due to rising global temperatures and increased demand for cooling appliances like ACs and refrigerators.

    Role of Refrigerants in Global Warming

    • Transition from CFCs to HFCs and HCFCs: Initially, chlorofluorocarbons (CFCs) were used in cooling appliances but were phased out by the 1987 Montreal Protocol due to ozone depletion concerns. They were replaced by hydrofluorocarbons (HFCs) and hydrochlorofluorocarbons (HCFCs).
    • Greenhouse Gas Potency: Although HFCs and HCFCs don’t harm the ozone layer, they are potent greenhouse gases, with some forms like HFC-134a having a global warming potential 3,400 times that of CO2.

    Sources and Effects of HFC and HCFC Emissions

    • Leakage from Appliances: These gases often leak from damaged appliances or car air conditioning systems, especially at the end of their life cycle.
    • Contribution to Warming: The leakage of these gases contributes significantly to global warming, with the Climate and Clean Air Coalition (CCAC) highlighting their potency.

    Challenge of Cooling Energy

    • Electricity for Cooling: A significant portion of cooling emissions comes from the electricity used to power cooling appliances.
    • Fossil Fuel Dependence: Much of this electricity is generated from fossil fuels, particularly in developing countries, contributing to climate change.

    Vicious Cycle of Cooling Demand and Global Warming

    • Feedback Loop: Rising global temperatures increase the demand for cooling, which in turn contributes to more warming.
    • Growing Cooling Device Market: The number of cooling devices is expected to rise from 3.6 billion to 9.5 billion by 2050, with a potential need for 14 billion devices if cooling access is expanded globally.

    Solutions and Strategies

    • Kigali Amendment to the Montreal Protocol: Over 150 countries agreed in 2016 to reduce HFC consumption by 80% by 2047, potentially avoiding over 0.4 degrees Celsius of global warming by 2100.
    • Promoting Climate-Friendly Refrigerants: The use of natural refrigerants with lower or zero global warming potential is being encouraged.
    • Proper Disposal and Management: Effective management and disposal of refrigerants could significantly reduce CO2 emissions.
    • Alternative Cooling Methods: Focusing on building designs that reduce the need for air conditioners, such as improved insulation and ventilation, is crucial.

    Conclusion

    • The Global Cooling Pledge represents a significant step in addressing a key contributor to climate change.
    • This initiative underscores the need for global cooperation in combating the escalating challenges posed by climate change.
  • Climate Change Negotiations – UNFCCC, COP, Other Conventions and Protocols

    INC-3: Global Efforts to Combat Plastic Pollution

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: INC-3

    Mains level: Global consesnsu on curbing Plastic Pollution

    Central Idea

    • The Intergovernmental Negotiating Committee (INC) met in Nairobi for its third round of negotiations under the UN Environment Programme.

    About Intergovernmental Negotiating Committee (INC)

    • INC is a committee that aims to develop a legally binding international instrument to end plastic pollution by 2025, as mandated by UNEA Resolution 5/14.
    • It began working in November 2022 at Punta del Este, Uruguay (INC-1).
    • The second meeting (INC-2) took place in May-June, 2023 at Paris, France.
    • INC is scheduled to complete its work by the end of 2024.

    Overview of INC-3

    • Event: The Intergovernmental Negotiating Committee (INC) met in Nairobi for its third round of negotiations under the United Nations Environment Programme.
    • Objective: To develop an international legally binding instrument to end plastic pollution worldwide, as mandated by UNEA Resolution 5/14.
    • Deadline: The INC is tasked with delivering a global plastics treaty by 2025.

    Significance of INC-3

    • Critical Stage: INC-3 was pivotal in negotiating the ‘zero draft’ text, which offered various options for core obligations and control measures.
    • Progress: Compared to INC-2 in Paris, INC-3 made substantive discussions on the treaty’s content.

    Key Aspects of the ‘Zero Draft’

    • Initial Strength: The zero draft proposed strong options for a legally binding treaty.
    • Dilution of Obligations: During negotiations, member states weakened core obligations, especially on primary polymer production, chemicals of concern, and trade.
    • Controversial Elements: The draft faced controversy over its scope and objectives, particularly regarding the production of primary polymers and lifecycle definitions.

    Financial Mechanism Discussions

    • Proposals: The draft included options like a plastic-pollution fee and reducing financial flow into high carbon footprint projects.
    • Opposition: Some countries, particularly those with vested economic interests, opposed these financial provisions.

    Trade in Plastics

    • Trade Restrictions: The treaty aims to address gaps left by the Basel Convention, but faced opposition regarding trade restrictions.
    • Misinterpretation of WTO Rules: Some countries misconstrued WTO rules to oppose trade restrictions, despite legal allowances for health and environmental protection.

    Challenges in Negotiations

    • Advocacy for Strong Provisions: African countries and Small-Island Developing States advocated for binding provisions, representing marginalized voices and emphasizing human rights and public health.
    • Rules of Procedure: INC-2’s unresolved debate on rules of procedure continued, affecting decision-making at INC-3.
    • Industry Influence: The presence of industry lobbyists indicated significant industry influence on the negotiations.
    • Stalling Tactics: Some countries used stalling and blocking tactics, delaying progress and expanding the draft text with national interest-driven changes.

    Outcomes and Takeaways from INC-3

    • Lack of Consensus: The meeting ended without consensus on intersessional work, hindering progress towards INC-4.
    • Exposure of Opposition: INC-3 highlighted the countries and industries opposed to a strong binding treaty.
    • Future Challenges: The lack of mandate adoption for the first draft development indicates significant challenges ahead in achieving a robust and effective global treaty on plastic pollution.

    Conclusion

    • INC-3’s outcomes underscore the complexities and challenges in formulating a global treaty on plastic pollution.
    • The divergent interests of member states, influenced by economic and industry considerations, pose significant hurdles.
    • The upcoming negotiations will be crucial in balancing these interests with the urgent need for effective global action to tackle the plastic pollution crisis.
  • Foreign Policy Watch: India-SAARC Nations

    Gujral Doctrine of Foreign Policy and its Significance

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Gujral Doctrine

    Mains level: Read the attached story

    Gujral Doctrine

    Central Idea: Remembering IK Gujral

    • Date: November 30 marks the 11th death anniversary of IK Gujral, India’s 12th Prime Minister.
    • Tenure: Gujral’s tenure as Prime Minister was less than a year, often overshadowed in discussions about India’s heads of government.
    • Unique Contribution: He is notably recognized for the ‘Gujral Doctrine’, a distinctive foreign policy approach named after him.

    Understanding the Gujral Doctrine

    • Background: Before becoming Prime Minister, Gujral served as the External Affairs Minister twice, during which he formulated his foreign policy approach.
    • Five Principles: Outlined in a speech at Chatham House, London, the doctrine emphasized-
    1. Non-reciprocity in relations with neighbors like Nepal, Bangladesh, Bhutan, Maldives, and Sri Lanka,
    2. Non-use of territory against each other,
    3. Non-interference in internal affairs,
    4. Respect for sovereignty and territorial integrity, and
    5. Peaceful bilateral negotiations for dispute resolution.
    • Exclusion of Pakistan: Notably, Pakistan was not included in the list of countries for non-reciprocal relations.
    • Philosophy: The doctrine was based on leveraging India’s size and influence in South East Asia through a non-domineering attitude and continuous dialogue, even with Pakistan.

    Successes of the Gujral Doctrine

    • Strengthening Regional Trust: The doctrine enhanced trust and cooperation with India’s neighbors.
    • Key Achievements: Notable successes include the signing of a 30-year water treaty with Bangladesh and positive developments in relations with Bhutan and Nepal.
    • Legacy: Successive Prime Ministers, despite differing political ideologies, continued to follow aspects of this doctrine.

    Criticism and Limitations

    • Perceived Leniency: Gujral faced criticism for being too lenient, particularly towards Pakistan, potentially leaving India vulnerable to future threats.
    • Perception in Pakistan: Some in Pakistan viewed the doctrine as an Indian strategy to isolate Islamabad.

    Gujral’s Personal Influence on the Doctrine

    • Background: Born in undivided Punjab and a participant in the freedom struggle, Gujral was known for his politeness and firmness in politics.
    • Stance during the Emergency: As Information Minister, he reportedly resisted Sanjay Gandhi’s orders to stifle the press.
    • International Relations Stance: Gujral was outspoken in his views, notably critiquing Britain’s suggestion to mediate over Kashmir.

    Legacy in India’s Foreign Policy

    • Impact on India’s Foreign Policy: Gujral’s approach left a lasting influence on India’s foreign policy, particularly in its relations with neighboring countries.
    • Recognition and Remembrance: His doctrine is remembered as a significant contribution to India’s diplomatic strategy, reflecting his understanding of regional dynamics and India’s role in South East Asia.

    Conclusion

    • The Gujral Doctrine stands as a testament to IK Gujral’s diplomatic acumen and his vision for India’s role in its immediate neighborhood.
    • His approach, emphasizing cooperation, non-reciprocity, and dialogue, continues to influence India’s foreign policy decisions and its relationships with neighboring countries.
  • Climate Change Negotiations – UNFCCC, COP, Other Conventions and Protocols

    What the OECD Report says of Climate Finance ahead of COP 28?

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: OECD

    Mains level: Read the attached story

    Central Idea

    • A recent report published by the OECD reveals that economically developed countries failed to fulfill their commitment to jointly mobilize $100 billion per year for climate mitigation and adaptation in developing countries in 2021, missing the 2020 deadline.
    • The report’s findings have significant implications for the upcoming COP 28 climate talks in the United Arab Emirates, where climate finance is expected to be a contentious issue.

    Organisation for Economic Cooperation and Development (OECD)

     

    • Establishment: Founded in 1961, succeeding the Organisation for European Economic Co-operation (OEEC) which was established in 1948 to help administer the Marshall Plan for the reconstruction of Europe after World War II.
    • Members: Initially European-focused, it now includes 38 member countries from across the globe, including many of the world’s most advanced economies and some emerging economies.
    • Purpose: To stimulate economic progress and world trade. It’s a forum where governments can work together to share experiences and seek solutions to common problems.
    • Key Functions: Provides a platform for comparing policy experiences, seeking answers to common problems, identifying good practices, and coordinating domestic and international policies of its members.
    • Major Publications: Includes the OECD Economic Outlook, the OECD Employment Outlook, and the Programme for International Student Assessment (PISA) report.

    Key Findings of the OECD Report

    • Shortfall in Climate Finance: Developed countries mobilized $89.6 billion in climate finance in 2021, falling short of the $100 billion target.
    • Decline in Adaptation Finance: The report highlights a 14% decrease in financing for climate adaptation in 2021 compared to the previous year.

    Significance of the OECD Report

    • Representation of Developed Nations: The OECD consists of affluent countries such as the U.S., the U.K., Germany, France, Switzerland, and Canada, providing insights into their climate finance priorities before the COP 28 talks.
    • COP 26 Pledge: The report follows a commitment by developed nations at COP 26 in 2020 to double adaptation finance and acknowledges their failure to meet the $100 billion goal on time.

    Issues related to Climate Finance Accountability

    • Composition of Climate Finance: The report reveals that a significant portion of public climate financing comes in the form of loans, raising concerns about debt stress in developing countries.
    • Loan Classification: The report’s treatment of loans without considering grant equivalents can exacerbate the burden on poorer nations, as loans may require repayment with interest.
    • ‘Additionality’: The UNFCCC mandates that developed countries provide “new and additional” financial resources for climate purposes, preventing the diversion of funds from other essential sectors like healthcare.
    • Lack of Defined Criteria: Developed countries have resisted efforts to establish a clear definition of climate finance, allowing ambiguity in classifying various types of funding.
    • Double-Counting: Some developed countries have been accused of double-counting development aid as climate finance, leading to the misallocation of resources.

    Climate Finance Needs and Future Projections

    • The OECD report suggests that $100 billion was likely met in 2022, but this data remains preliminary and unverified.
    • Developing countries are projected to require approximately $1 trillion annually for climate investments by 2025, escalating to $2.4 trillion per year from 2026 to 2030, highlighting the inadequacy of the $100 billion goal.

    Conclusion

    • The OECD report on climate finance underscores the gap between promises made by developed nations and their actual contributions.
    • Issues of loan classification, additionality, and a lack of clear criteria for climate finance need to be addressed for greater transparency and accountability.
    • As developing countries face growing climate-related challenges, public funding from governments and multilateral development banks remains crucial to meeting their needs.
  • OBOR Initiative

    China to extend China-Myanmar Economic Corridor to Sri Lanka

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: China-Myanmar Economic Corridor

    Mains level: Belt and Road Initiative

    cmec

    Central Idea

    • In a significant move towards expanding the Belt and Road Initiative (BRI) in South Asia, China has expressed its commitment to prioritize the extension of the China-Myanmar Economic Corridor (CMEC) to Sri Lanka.

    What is CMEC?

    Details
    Geographical Scope Connects China’s Yunnan Province with Mandalay, Kyaukphyu SEZ on the Bay of Bengal, and Yangon in Myanmar.
    Strategic Importance Provides China an alternative to the Strait of Malacca for trade and energy transport. Offers a shorter, more secure route to the Middle East and Africa.
    Infrastructure Involves building roads, railways, ports, and industrial zones. Key projects include the development of the Kyaukphyu deep-sea port.
    Economic Impact on Myanmar Promises infrastructure development, foreign investment, and job creation in Myanmar. Raises concerns about debt sustainability, environmental impact, and displacement of local communities.
    Political and Security Challenges The corridor passes through politically sensitive and conflict-prone areas in Myanmar, posing challenges to its implementation and stability.

    Expanding the Economic Corridor

    • China’s Strategic Priority: State Councillor Shen Yiqin emphasized that China is making the extension of the CMEC to Sri Lanka a strategic priority.
    • Free Trade Agreement Acceleration: Both nations affirmed their commitment to expediting the implementation of the China-Sri Lanka Free Trade Agreement, reinforcing their economic partnership.

    Significance of CMEC in BRI

    • CMEC’s Emergence: CMEC is the latest addition to the six land corridors within the Belt and Road Initiative, gaining prominence over the stalled Bangladesh-China India Myanmar (BCIM) corridor.
    • South Asian Perspective: India and Bhutan remain outside the BRI framework, while countries like Sri Lanka are enthusiastic participants, poised for a more substantial economic contribution in the second phase of the initiative.
  • Skilling India – Skill India Mission,PMKVY, NSDC, etc.

    India’s Global Talent Competitiveness Ranking falls to 103

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Global Talent Competitiveness Index (GTCI)

    Mains level: NA

    Central Idea

    • India’s ranking in the Global Talent Competitiveness Index (GTCI) has significantly declined from 83 a decade ago to 103 in the latest report released this month.
    • India now finds itself positioned between Algeria (ranked 102) and Guatemala (ranked 104), all classified as lower-middle-income countries.

    About Global Talent Competitiveness Index (GTCI)

    • The GTCI ranks 134 countries based on their ability to grow, attract, and retain talent.
    • It is released by INSEAD, a partner and sponsor of the United Nation’s Sustainable Development Goals (SDGs)Davos, Switzerland recently.
    • INSEAD is one of the world’s leading and largest graduate business schools with locations all over the world and alliances with top institutions.
    • The report ranks countries based on 6 pillars:
    1. enable
    2. attract
    3. grow
    4. retain talent
    5. vocation and technical skills
    6. global knowledge skills

    India’s Ranking and Comparisons

    • Rank 103: India’s current rank is well below the median score of the countries assessed in the GTCI.
    • BRICS Nations: India’s performance in the GTCI is the weakest among the BRICS countries. China leads the group at rank 40, followed by Russia at 52, South Africa at 68, and Brazil at 69.
    • Top Three Countries: These are Singapore, Switzerland, and the United States.
    • Skills Mismatch: India faces an increased skills mismatch and difficulties in finding skilled employees, resulting in its low rankings in the ‘Employability’ and ‘Vocational and Technical Skills’ categories.
    • Best-Performing Area: India’s best-performing area in the GTCI is “Global Knowledge Skills,” driven by innovation and software development, contributing to its 69th position in the “Talent Impact” sub-pillar.
  • Foreign Policy Watch: India – EU

    India-UK Free Trade Agreement: A Strategic Shift in Trade Relations

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Free Trade Agreement

    Mains level: NA

    fta

    Central Idea

    • External Affairs Minister recent discussions with British PM have put the India-UK Free Trade Agreement (FTA) at the forefront of bilateral negotiations.

    Why does this FTA matter?

    • The FTA, when finalized, is expected to not only enhance economic ties between India and the UK but also serve as a blueprint for similar agreements with India’s second-largest trading partner, the European Union (EU).

    What is Free Trade Agreement (FTA)?

    • A Free Trade Agreement (FTA) is a legally binding trade pact between two or more countries or regions that aims to reduce or eliminate barriers to trade and promote economic cooperation.
    • FTAs are designed to facilitate the exchange of goods and services across borders by reducing or eliminating tariffs (import taxes), quotas, and various non-tariff barriers, such as regulations and licensing requirements.
    • These agreements are negotiated to create a more open and competitive trade environment, fostering economic growth and prosperity among the participating nations.

    India’s considerations and UK

    • Economic Integration: India is reorienting its trade strategy, moving away from previous trade deals that widened deficits with East Asian countries. Instead, it’s focusing on strengthening economic integration with Western and African nations.
    • Reducing Dependence on China: The disruption of global supply chains during the pandemic exposed the risks of overreliance on China. Western countries, including Australia and the UK, are now seeking a ‘China-plus one’ approach in trade.
    • RCEP Exit: India’s exit from the China-dominated Regional Comprehensive Economic Partnership (RCEP) further underscores its desire to bolster trade ties with the UK, EU, Australia, and others as a counterbalance to China’s influence.

    Brexit Influence and UK’s Perspective

    • Crucial for UK: A trade deal with India holds significant importance for the UK, especially as it faces a challenging election in early 2025. Concerns that fueled the Brexit vote have made the UK cautious about offering work permits to Indian service sector workers under the FTA.
    • Market Compensation: Despite Brexit uncertainties, the vast Indian market provides London with an opportunity to offset the loss of access to the European Single Market.

    Benefits for India and the UK

    • India’s Gains: Indian labour-intensive sectors like apparel and gems & jewellery have struggled with declining market share. A trade deal could potentially level the playing field with competitors like Bangladesh. However, it may have repercussions on Least Developed Countries.
    • UK’s Advantages: Past trade deals have shown that eliminating duties doesn’t guarantee export growth. Reduction of tariffs on British exports like cars, whisky, and wines could provide deeper access to Indian markets.
    • Tariff Disparity: The average tariff on Indian imports to the UK is 4.2%, while the average tariff in India on goods from the UK is 14.6%, highlighting the potential for tariff alignment.

    Addressing Non-Tariff Barriers (NTBs)

    • Modern FTA Scope: FTA negotiations could focus on eliminating non-tariff barriers (NTBs), which have historically hindered exports. NTBs often involve regulations, standards, testing, certification, or reshipment inspections, especially in agriculture and manufacturing.
    • Conformity Assessments: Indian agricultural exporters often face strict limits on contaminants, and Indian products face rejections due to conformity assessments and technical requirements.

    Carbon Tax and Impact

    • The UK, akin to the EU, is considering a carbon border adjustment mechanism (CBAM) that imposes a carbon tax on certain imports based on emissions.
    • This move may affect India’s exports, even with reduced tariffs, particularly in sectors like cement, chemicals, steel, and power generation.

    Conclusion

    • The India-UK Free Trade Agreement represents a strategic shift in India’s trade policy, emphasizing Western and African integration while mitigating dependence on China.
    • For the UK, it offers a chance to compensate for Brexit-related losses and strengthen ties with a significant economic partner.
    • Addressing tariff disparities, NTBs, and carbon taxes will be pivotal in shaping the FTA’s impact on both nations’ economies.
  • Climate Change Negotiations – UNFCCC, COP, Other Conventions and Protocols

    COP28 in Dubai: What to expect from Climate meeting

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: COP28

    Mains level: Read the attached story

    COP28

    Central Idea

    • The upcoming COP28, scheduled to be held in Dubai from November 30 to December 12, faces the daunting challenge of addressing the urgent climate crisis.
    • Despite decades of negotiations, current global commitments to combat climate change are deemed insufficient.
    • With temperatures rising at an alarming rate, the need for substantial action has never been more critical.

    What is COP?

    • The word ‘COP’ is an acronym for ‘Conference of the Parties. The ‘parties’ are the governments around the world that have signed the UN Framework Convention on Climate Change (UNFCCC), a treaty agreed upon in 1994.
    • Every year, the COP is hosted by a different nation and the first such COP meeting – ‘COP1’ – took place in Germany in 1995.
    • The conferences are attended by world leaders, negotiators, and ministers, and also by representatives from civil society, business, international organisations, and the media.
    • The last COP-27 edition convened in Sharm el-Sheikh, Egypt with the theme “Together for Implementation” and to renew and extend the agreements reached in the historic Paris Agreement.

    Climate Action So Far: Crisis and Inadequate Responses

    • Rising Temperatures: 2023 is poised to become the warmest year ever recorded, with monthly warming records continually broken.
    • Response Lag: Global efforts to combat climate change have not kept pace with the rapid temperature increase.
    • Assessment: Recent reports indicate that current climate action plans, even in an optimistic scenario, would only achieve a 2% reduction in emissions by 2030, far from the 43% reduction recommended by the Intergovernmental Panel on Climate Change (IPCC) to limit warming to 1.5 degrees Celsius.
    • Financial Gap: Despite increasing climate risks, financial resources allocated for adaptation measures in developing countries are insufficient, with a vast disparity between the required and actual funding.

    Expectations from COP28

    COP28 aims to address these pressing climate challenges and achieve significant outcomes:

    (1) Tripling of Renewable Energy:

    • Objective: Triple the global installed capacity of renewable energy by 2030, resulting in 70% of electricity generation from renewables.
    • Potential: This initiative could reduce 7 billion tonnes of carbon dioxide equivalent emissions by 2030, making it a substantial step toward emission reduction.
    • Support: The proposal has garnered endorsement from G20 countries and explicit support from 60 others.

    (2) Delivery of $100 Billion:

    • Background: Developed countries pledged to mobilize $100 billion annually in climate finance from 2020, a commitment that remains unfulfilled.
    • Progress: Developed nations are expected to claim fulfillment of this promise at COP28, though it remains inadequate compared to the trillions required for climate action.
    • Challenge: The greater challenge lies in negotiating additional funding beyond the $100 billion annually, commencing from next year.

    (3) Funding for Loss and Damage:

    • Fund Creation: The establishment of a loss and damage fund, designed to assist countries affected by climate change impacts, was a notable outcome of the previous climate meeting in Egypt.
    • Funding Flow: COP28 is expected to witness financial contributions to the loss and damage fund, signaling progress in addressing concerns, especially for small island nations.

    (4) Global Stocktake:

    • Mandate: As per the Paris Agreement (2015), COP28 will present findings from the first global stocktake exercise. This assessment evaluates countries’ progress in combating climate change and outlines necessary actions for the next five years.
    • Informing Action: The stocktake findings will inform discussions and actions during the conference, providing a roadmap for more effective climate action.

    (5) Phase-down of Fossil Fuels:

    • Challenge: Controversial debates on the scheduled phase-down or phase-out of fossil fuels, particularly coal, persist among nations.
    • Contentious Issue: Resolving the disagreement over fossil fuel reduction is expected to be a complex and unresolved matter at COP28.

    Conclusion

    • COP28, set to be held in Dubai, represents a critical opportunity to address the climate crisis.
    • With expectations of tripling renewable energy, fulfillment of $100 billion climate finance commitments, funding for loss and damage, and global stocktake findings, the conference aims to push climate action forward.
    • However, the contentious issue of fossil fuel phase-down remains a challenge for the conference.
    • The world eagerly anticipates the outcomes and progress toward mitigating climate change.
  • Capital Markets: Challenges and Developments

    India’s Growing Influence on the MSCI Emerging Markets Index

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: MSCI EM Index

    Mains level: NA

    Emerging Markets

    Central Idea

    • India’s presence on the MSCI Emerging Markets (EM) Index is set to expand with the inclusion of nine new stocks, effective from 30th November.
    • This development will elevate India’s weightage on the index to 16.3%, reaching an all-time high representation of 131 Indian stocks.

    What is MSCI EM Index?

    • MSCI is a globally recognized index listed on the NYSE.
    • It is released and maintained by MSCI Inc., a leading provider of global equity indices, investment analytics, and other financial data and services.
    • Its stock indices are closely monitored by global asset managers, hedge funds, banks, corporations, and insurance companies.
    • They rely on these indices to allocate funds across global stock markets.
    • MSCI indices serve as a foundation for passive investments through exchange-traded funds (ETFs), index funds, and certain fund of funds.

    India’s Progress on the EM Index

    • Increasing Weight: India’s weightage on the MSCI EM Index has steadily grown, poised to double to 16.3% from four years ago with the upcoming rebalancing.
    • Second to China: India ranks second, trailing only China (29.89%), on the EM Index, outperforming countries like Taiwan (15.07%), South Korea (11.78%), and Brazil (5.42%).
    • Strong Performance: As an independent entity, India has excelled in generating net returns, boasting a 4.75% return in the year through October compared to MSCI EM’s -2.14%. Over the long term, India has achieved an annualized 8.33% return over ten years versus MSCI EM’s 1.19%.

    Inclusion Criteria for Stocks

    • Market Capitalization-Based Weightage: Stocks’ weights on the EM index are determined by free-float market capitalization, which represents shares available for foreign investors to trade. Higher market capitalization leads to greater weight and allocation by investors.
    • Top Indian Stocks: Prominent Indian stocks on MSCI EM include Reliance Industries (weight 1.34%), ICICI Bank (0.91%), and Infosys (0.87%).

    Impact of Increased Representation

    • Passive Inflows: Passive foreign trackers are expected to inject $1.5 billion into the nine newly included Indian stocks and other Indian counters with increased weights.
    • Stock Rebalancing: MSCI’s adjustments involve increasing the weights of stocks like Zomato, Hindustan Aeronautics, and Jio Financial Services, potentially attracting around $160 million in passive inflows. However, heavyweight stocks like Reliance may experience minor weight reductions.
    • Overall FPI Investment: The increase primarily benefits passive trackers, and it may not necessarily lead to a surge in overall foreign portfolio investment (FPI) flows. Nonetheless, it boosts investor sentiment, as passive investments tend to offer higher returns over extended periods due to lower expenses and reduced human error.
    • Positive Sentiment: MSCI EM’s positive review of India comes shortly after Morgan Stanley upgraded India to the status of the most preferred emerging market, further enhancing India’s appeal to global