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Type: IOCR

  • Kunming Declaration on Biodiversity Conservation

    The Kunming Declaration was adopted by over 100 countries at the first part of the ongoing virtual 15th meeting of the Conference of the Parties to the United Nations Convention on Biological Diversity.

    Kunming Declaration

    • It calls upon the parties to “mainstream” biodiversity protection in decision-making and recognise the importance of conservation in protecting human health.
    • The theme of the declaration is Ecological Civilization: Building a Shared Future for All Life on Earth.
    • By adopting this, the nations have committed themselves to support the development, adoption and implementation of an effective post-2020 implementation plan for the Cartagena Protocol on biosafety.
    • Signatory nations will ensure that the post-pandemic recovery policies, programs and plans contribute to the conservation and sustainable use of biodiversity.

    About Convention on Biological Diversity (CBD)

    • The CBD (wef 1993) known informally as the Biodiversity Convention, is a multilateral treaty.
    • The convention has three main goals:
    1. the conservation of biodiversity
    2. the sustainable use of its components
    3. the fair and equitable sharing of benefits arising from genetic resources
    • Its objective is to develop national strategies for the conservation and sustainable use of biological diversity, and it is often seen as the key document regarding sustainable development.
    • It has two supplementary agreements, the Cartagena Protocol and Nagoya Protocol.

    (1) Cartagena Protocol

    • It is an international treaty governing the movements of living modified organisms (LMOs) resulting from modern biotechnology from one country to another.

    (2) Nagoya Protocol

    • It deals with Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization (ABS).

     

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  • [pib] One Sun One World One Grid

    The Union Minister for Power and New and Renewable Energy (MNRE) has addressed the Ministerial session of the Green Grids Initiative-One Sun One World One Grid (OSOWOG) Northwest Europe Cooperative Event.

    One Sun, One World, One Grid

    • The mega plan of OSOWOG calls for trans-national electricity grid supplying solar power across the globe.
    • It will connect 140 countries through a common grid that will be used to transfer solar power.
    • The idea was first floated by PM Modi in 2018 during the first assembly of the International Solar Alliance (ISA).
    • The vision behind the OSOWOG mantra is “the Sun never sets” and is a constant at some geographical location, globally, at any given point of time.

    With India at the fulcrum, the solar spectrum can easily be divided into two broad zones viz:

    1. Far East: It would include countries like Myanmar, Vietnam, Thailand, Lao, Cambodia and
    2. Far West: It would cover the Middle East and the Africa Region

    Implementation phases of the plan

    The plan is divided into three phases:

    • Phase 1: It will connect the Indian grid with the Middle East, South Asia and South-East Asian grids to share solar and other renewable energy resources
    • Phase 2: It will connect the first phase nations with the African pool of renewable sources
    • Phase 3: It will be the concluding step of global interconnection

    How novel is the idea?

    (1) Scale of the program

    • Not limited by national boundaries, it can tackle global challenges linked to energy.
    • It will tackle access for underserved people and communities the world over.
    • It will enable 3 billion people to access clean drinking water (via solar pumps), give 2 billion women access to clean cooking and bring light to the homes of 750 million people.

    (2) Pivotal moment in India’s energy history

    • Going back even further, almost a decade ago, the price of solar energy (then INR 15 a unit) had raised question marks about its commercial feasibility.
    • Today OSOWOG envisions dispatching surplus electricity at near-zero cost as India produces the cheapest solar-powered electricity anywhere in the world.

    (3) Sustainability

    • OSOWOG directly tackles two key problems that are emerging as energy systems try to deliver both energy sustainability and access to underserved populations.
    • Countries like Singapore or Bangladesh simply may not have enough empty land to generate solar energy.
    • Many nations’ policies also prioritise food security (i.e., devoting land to farming) over solar energy. These countries can still benefit from the solar energy dispatched to them via OSOWOG.

    (4) India extending leadership

    • Having international associations is not a new trend for the energy sector which already has a strong geopolitical organisation such as OPEC.
    • Several countries including China have initiated infrastructure projects in other countries, which is seen as a sign of asserting supremacy by several policy experts.
    • While India is a partner nation with most trade associations, with ISA and OSOWOG, it is planning to take a leadership position.

    Significance of OSOWOG

    • Successful ambitious project: It is obviously a very grand and ambitious project with a looming success.
    • Pathbreaking idea: It is also clear that a new energy sector paradigm is needed as we are facing a huge inflection point in electricity generation and consumption.
    • Green benefits: Potential benefits include widespread scale up in energy access, abatement in carbon emissions, lower cost and improved livelihoods.
    • Energy alternative: With battery and storage technology becoming cheaper, electricity consumption at source end is a more feasible idea for solar power.

    Limitations of OSOWOG

    • Low financial benefits: This may sound a geopolitically a clever strategy. However, it is to be seen if this makes sense, technology-wise and in terms of financial benefits.
    • Cost-sharing challenge: The mechanism of cost-sharing will be challenging, given the varied priorities of participating countries depending on their socio-economic orders.
    • Pace of progress: The OSOWOG will turn out to be an expensive, complex and very slow progress project.
    • Geopolitical issue: Any disruption caused due to any bilateral/multilateral issues can potentially affect critical services in multiple continents and countries.
    • Grid parameters: There is a difference in voltage, frequency and specifications of the grid in most regions. Maintaining grid stability with just renewable generation would be technically difficult.

    Way forward

    • While India has taken baby steps with ISA, a major investment drive is still missing. This is planned to be achieved through OSOWOG.
    • India will need a strong coalition of international partners to realise this vision.

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    Back2Basics: International Solar Alliance

    • Officially announced during UN Climate Change Conference in Paris in 2015, the ISA is a partnership of solar-resource rich countries.
    • Currently, there are 121 countries that have agreed to be members for ISA.
    • Most of these are countries with large participation from Africa, South-east Asia and Europe.
    • Pakistan and China are not a part of ISA.

     

  • India retains 3rd position in RE Investment Attractiveness Index

    India has retained the third rank in the Renewable Energy Country Attractiveness Index released by consultancy firm EY.

    RE Country Attractiveness Index (RECAI)

    • The RECAI ranks the world’s top 40 markets on the attractiveness of their renewable energy investment and deployment opportunities.
    • The rankings reflect assessments of market attractiveness and global market trends.

    India’s performance

    • India remained at the third position since three consecutive years.
    • India’s thriving renewable energy market conditions, inclusive policy decisions, investment and technology improvements focusing on self-reliant supply chains have pushed the transition.
    • RECAI highlights that corporate power purchase agreements (PPAs) are emerging as a key driver of clean energy growth.
    • A new PPA Index – introduced in this edition of RECAI – focuses on the attractiveness of renewable power procurement and ranks the growth potential of a nation’s corporate PPA market.
    • India is ranked sixth among the top 30 PPA markets.

    Global scenario

    • The US, mainland China and India continue to retain the top three rankings and Indonesia is a new entrant to the RECAI.
    • The top-performing markets have held their ground in this latest issue – with no movement into or out of the top eight.
    • France (fourth position, up by one) and the UK (fifth position, down by one), while Germany (sixth position, up by one) has edged back ahead of Australia (seventh position, down by one).

     

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  • India invited to become full-time IEA member

    International Energy Agency (IEA) has invited India, the world’s third-largest energy consumer, to become its full-time member.

    International Energy Agency (IEA)

    • The IEA is an autonomous intergovernmental organization established in the framework of the Organisation for Economic Co-operation and Development (OECD) in 1974 in the wake of the 1973 oil crisis.
    • Based in Paris, IEA was initially dedicated to responding to physical disruptions in the supply of oil, as well as serving as an information source on statistics about the international oil market.
    • In the decades since, its role has expanded to cover the entire global energy system, encompassing traditional energy sources such as oil, gas, and coal as well as cleaner and faster growing ones such as solar PV, wind power and biofuels.
    • It is best known for the publication of its annual World Energy Outlook.

    Role and responsibility

    • The Agency’s mandate has broadened to focus on providing analysis, data, policy recommendations and solutions to help countries ensure secure, affordable and sustainable energy for all.
    • In particular, it has focused on supporting global efforts to accelerate the clean energy transition and mitigate climate change.
    • The IEA has a broad role in promoting rational energy policies and multinational energy technology co-operation with a view to reaching net zero emissions.

    India and IEA

    • India, in March 2017, became an associate member of the Paris-based body which advises industrialised nations on energy policies.
    • Today the IEA acts as a policy adviser to its member states, as well as major emerging economies such as Brazil, China, India, Indonesia and South Africa to support energy security and advance the clean energy transition worldwide.

    Significance of the invitation

    • This proposal if accepted will require New Delhi to raise strategic oil reserves to 90 days requirement.
    • India is becoming increasingly influential in global energy trends.

    Try this MCQ:

    Q.The Global Energy Transition Index recently seen in news is released by:

    a) International Energy Agency (IEA)

    b) World Economic Forum (WEF)

    c) International Renewable Energy Agency (IRENA)

    d) International Solar Alliance

     

    [wpdiscuz-feedback id=”092iami3uv” question=”Please leave a feedback on this” opened=”1″]Post your answers here.[/wpdiscuz-feedback]

     

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  • WTO raises 2021 goods trade outlook

    The World Trade Organization (WTO) has upgraded its world merchandise trade growth outlook to nearly 11 percent for this year, higher than 8% estimated in March.

    About WTO

    • The World Trade Organization (WTO) is an intergovernmental organization that regulates and facilitates international trade between nations.
    • Governments use the organization to establish, revise, and enforce the rules that govern international trade.
    • It officially commenced operations on 1 January 1995, pursuant to the 1994 Marrakesh Agreement, thus replacing the General Agreement on Tariffs and Trade (GATT) that had been established in 1948.
    • The WTO is the world’s largest international economic organization, with 164 member states representing over 96% of global trade and global GDP.
    • The WTO facilitates trade in goods, services and intellectual property among participating countries.
    • It prohibits discrimination between trading partners, but provides exceptions for environmental protection, national security, and other important goals.

    Report on Global trade

    • According to a WTO, global goods trade is expected to grow by 10.8 per cent compared to the forecast of 8 per cent in March, but with varied recovery, depending on the region.
    • The report said export volume growth in 2021 will be 8.7 per cent in North America, 7.2 per cent in South America, 9.7 per cent in Europe, 7 per cent in Africa, 5 per cent in West Asia and the highest for Asia at 14.4 per cent.
    • On the other hand, imports are expected to grow at a faster pace as compared to exports. Inbound shipments into North America are set to grow by 12.6 per cent.
    • It will be 19.9 per cent in South America, 9.1 per cent in Europe, 13.1 per cent in CIS, 11.3 per cent in Africa, 9.3 per cent in West Asia and 10.7 per cent in Asia.

    Key highlights for India

    • Exports from India have been rising consistently over the last few quarters, after plummeting for a few months as the outbreak of Covid-19 disrupted global trade.
    • India’s exports to its top trading partners such as the US, European Union, nations in West Asia, among others, are expected to rise.
    • Exports data during the first six months of the current fiscal year is emblematic of the fact that external demand has been robust.
    • Besides, supply-side disruptions can also be exacerbated by the rapid and unexpectedly strong recovery of demand in advanced and many emerging economies.

    Competing with China

    • Experts said with rising global demand, India should be able to compete in various segments vis-a-vis China.
    • Currently, China is facing supply-side as well as demand-side issues owing to several internal challenges (energy, debt crisis).
    • Therefore, India is in a good position to increase its exports, and can become a substitute for China across various product categories or sectors.
    • India can take advantage of the increasing global demand, which can ultimately translate into demand for Indian exports.

     

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  • Explained: Global Minimum Tax Deal

    A global deal to ensure big companies pay a minimum tax rate of 15% and make it harder for them to avoid taxation has been agreed by 136 countries.

    What is the news?

    • The OECD said four countries – Kenya, Nigeria, Pakistan and Sri Lanka – had not yet joined the agreement.
    • However, the countries behind the accord together accounted for over 90% of the global economy.

    Why a global minimum tax?

    • With budgets strained after the COVID-19 crisis, many governments want more than ever to discourage multinationals from shifting profits – and tax revenues – to low-tax countries.
    • Increasingly, income from intangible sources such as drug patents, software and royalties on intellectual property has migrated to these jurisdictions.
    • This has allowed companies to avoid paying higher taxes in their traditional home countries.
    • The minimum tax and other provisions aim to put an end to decades of tax competition between governments to attract foreign investment.

    How would a deal work?

    • The global minimum tax rate would apply to overseas profits of multinational firms with 750 million euros ($868 million) in sales globally.
    • Govts could still set whatever local corporate tax rate they want.
    • However, buif companies pay lower rates in a particular country, their home governments could “top up” their taxes to the 15% minimum, eliminating the advantage of shifting profits.
    • A second track of the overhaul would allow countries where revenues are earned to tax 25% of the largest multinationals’ so-called excess profit – defined as profit in excess of 10% of revenue.

    What happens next?

    • The next step is for finance ministers from the Group of 20 economic powers to formally endorse the deal, paving the way for adoption by G20 leaders at an end October summit.
    • Nonetheless, questions remain about the US position which hangs in part on a domestic tax reform the Biden administration wants to push through the US Congress.
    • The agreement calls for countries to bring it into law in 2022 so that it can take effect by 2023, an extremely tight timeframe given that previous international tax deals took years to implement.
    • Countries that have in recent years created national digital services taxes will have to repeal them.

    What will be the economic impact?

    • The OECD, which has steered the negotiations, estimates the minimum tax will generate $150 billion in additional global tax revenues annually.
    • Taxing rights on more than $125 billion of profit will be additionally shifted to the countries were they are earned from the low tax countries where they are currently booked.
    • Economists expect that the deal will encourage multinationals to repatriate capital to their country of headquarters, giving a boost to those economies.
    • However, various deductions and exceptions baked into the deal are at the same time designed to limit the impact on low tax countries like Ireland, where many US groups base their European operations.

    Back2Basics: Base Erosion and Profit Shifting (BEPS)

    • BEPS refers to corporate tax planning strategies used by multinationals to “shift” profits from higher-tax jurisdictions to lower-tax jurisdictions.
    • It thus “erodes” the “tax base” of the higher-tax jurisdictions.
    • Corporate tax havens offer BEPS tools to “shift” profits to the haven, and additional BEPS tools to avoid paying taxes within the haven.
    • It is alleged that BEPS is associated mostly with American technology and life science multinationals.

    Try this:

     

    Q.3) What are the factors that led to the demand of global minimum corporate tax? What will be its implications for India? (10 Marks)

     

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  • India-ASEAN FTA

    The Commerce and Industry Minister has called for a renegotiation of the India-ASEAN free trade agreement (FTA).

    Why such move?

    • The MCI aims to prevent its misuse by ‘third parties’ and remove trade restrictions as well as non-tariff barriers that he said had hurt Indian exports disproportionately since the pact was operationalized in 2010.
    • The focus needed to be on new rules to eliminate misuse ‘by third parties outside ASEAN’, the minister said, hinting at China.
    • India had to deal with several restrictive barriers on exports in the ASEAN region, particularly in the agriculture and auto sectors.

    About ASEAN

    • Members:
    • Officially the Association of Southeast Asian Nations, ASEAN is an economic union comprising 10 member states in Southeast Asia.
    • It promotes intergovernmental cooperation and facilitates economic, political, security, military, educational, and sociocultural integration between its members and other countries in Asia.

    India-ASEAN Free Trade Agreement

    • The initial framework agreement for ASEAN–India Free Trade Area (AIFTA) was signed on 8 October 2003 in Bali, Indonesia.
    • The FTA came into effect on 1 January 2010.
    • The FTA had emerged from a mutual interest of both parties to expand their economic ties in the Asia-Pacific region.

    Background of the AIFTA

    • India’s Look East policy was reciprocated by similar interests of many ASEAN countries to expand their interactions westward.
    • After India became a sectoral dialogue partner of ASEAN in 1992, India saw its trade with ASEAN increase relative to its trade with the rest of the world.
    • Between 1993 and 2003, ASEAN-India bilateral trade grew at an annual rate of 11.2%, from US$2.9 billion in 1993 to US$12.1 billion in 2003.
    • Total Indian FDI into ASEAN from 2000 to 2008 was US$1.3 billion.

    Acknowledging this trend and recognising the economic potential of closer linkages, both sides recognised the opportunities to pave the way for the establishment of an ASEAN–India Free Trade Area (FTA).

    Structure of the AIFTA

    • The signing of the ASEAN-India Trade in Goods Agreement paves the way for the creation of one of the world’s largest FTAs – a market of almost 1.8 billion people with a combined GDP of US$2.8 trillion.
    • It sees tariff liberalisation of over 90 percent of products traded between the two dynamic regions, including the so-called “special products”.
    • The products include palm oil (crude and refined), coffee, black tea and pepper.

    Criticism

    While there are many benefits to the ASEAN-India FTA, there is concern in India that the agreement will have several negative impacts on the economy.

    • Opening-up its market: This FTA will allow them to increase the market access of their products.
    • No specific gains: It is criticised, however, that India will not experience as great an increase in market access to ASEAN countries as ASEAN will in India.
    • Export driven ASEAN: The economies of the ASEAN countries are largely export-driven. Considering India’s expansive domestic market, the ASEAN countries will look eagerly towards India as a home for its exports.
    • Huge trade deficit: Since the early 2000s, India has had an increasing trade deficit with ASEAN. It is feared that a gradual liberalisation of tariffs and a rise in imported goods into India will threaten several sectors of the economy.
    • Inaccessible Markets: As a dominant exporter of light manufacturing products, ASEAN has competitive tariff rates that make it difficult for India to gain access to the industry market in ASEAN countries.
    • Cheaper imports: The state of Kerala is an important exporter in the national export of plantation products. It fears that cheap imports of oil palm, rubber, coffee, and fish would lower domestic production, adversely affecting farmers and ultimately its economy.

     

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  • NATO fires Russian Diplomats

    NATO has withdrew the accreditation of eight Russian officials to the military alliance in response to a rise in malign activities by Moscow.

    NATO

    • NATO is a military alliance established by the North Atlantic Treaty (also called the Washington Treaty) of April 4, 1949.
    • It sought to create a counterweight to Soviet armies stationed in Central and Eastern Europe after World War II.
    • Its original members were Belgium, Canada, Denmark, France, Iceland, Italy, Luxembourg, the Netherlands, Norway, Portugal, the United Kingdom, and the United States.
    • NATO has spread a web of partners, namely Egypt, Israel, Sweden, Austria, Switzerland and Finland.

    Why was it founded?

    Ans. Communist sweep in Europe post-WWII and rise of Soviet dominance

    • After World War II in 1945, Western Europe was economically exhausted and militarily weak, and newly powerful communist parties had arisen in France and Italy.
    • By contrast, the Soviet Union had emerged from the war with its armies dominating all the states of central and Eastern Europe.
    • By 1948 communists under Moscow’s sponsorship had consolidated their control of the governments of those countries and suppressed all non-communist political activity.
    • What became known as the Iron Curtain, a term popularized by Winston Churchill, had descended over central and Eastern Europe.

    Ideology of NATO

    • The NATO ensures that the security of its European member countries is inseparably linked to that of its North American member countries.
    • It commits the Allies to democracy, individual liberty and the rule of law, as well as to peaceful resolution of disputes.
    • It also provides a unique forum for dialogue and cooperation across the Atlantic.

    The Article 5

    • The heart of NATO is expressed in Article 5, in which the signatory members agree that an armed attack against one or more of them in Europe or North America shall be considered an attack against them all.

    Why in news now?

    • The relationship between NATO and Russia is at its lowest point since the end of the Cold War.
    • The NATO (rather US) sees their aggressive actions, not least against Ukraine, but also the significant military buildup and violations of important arms control agreements.
    • NATO suspended practical cooperation with Russia in 2014 after it annexed Ukraine’s Crimean Peninsula.

     

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  • India joins High Ambition Coalition (HAC)

    India has officially joined the High Ambition Coalition for Nature and People, a group of more than 70 countries encouraging the adoption of the global goal to protect 30×30.

    High Ambition Coalition (HAC)

    Aim: To promote an international agreement to protect at least 30 % the of world’s land and ocean by 2030

    • The HAC is an informal group of approximately 61 countries within the UN Framework Convention on Climate Change (UNFCCC).
    • It is committed to advancing progressive proposals on climate ambition.
    • The HAC was founded by the Republic of the Marshall Islands in 2014 with the aim of ensuring the Paris Agreement, adopted in 2015, was as ambitious as possible.
    • The Republic of the Marshall Islands serves as the convener and secretariat of the HAC.
    • The global 30×30 goal is currently a centerpiece of the treaty.

    Members

    • HAC members currently include a mix of countries in the global north and south; European, Latin American, Africa and Asia countries are among the members.
    • India is the first of the BRICS bloc of major emerging economies (Brazil, Russia, India, China and South Africa) to join the HAC.

     

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  • [pib] Industrial Park Ratings System (IPRS) Report

    The Department for Promotion of Industry and Internal Trade (DPIIT) has released the Industrial Park Ratings System Report.

    Industrial Park Ratings System (IPRS)

    • The IPRS pilot exercise was launched in 2018 with an objective of enhancing industrial infrastructure competitiveness and supporting policy development for enabling industrialization across the country.
    • The IPRS report is an extension of the India Industrial Land Bank which features more than 4,400 industrial parks in a GIS-enabled database.
    • It seeks to help investors identify their preferred location for investment.
    • With this report, the investors can even remotely refer to this report to identify the suitable investable land area, as per the various parameters of infrastructure, connectivity, business support services and environment and safety standards.

    Highlights of the report

    • 41 Industrial Parks have been assessed as “Leaders” in the Industrial Park Ratings System Report released by DPIIT.
    • 90 Industrial Parks have been rated as under the Challenger category while 185 have been rated as under “Aspirers”.
    • These ratings are assigned on the basis of key existing parameters and infrastructure facilities etc.

     

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