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  • India to unveil 50-year Government Bonds

    Central Idea

    • India is set to make history by issuing it’s first-ever 50-year government bonds and 30-year green bonds.
    • These offerings have piqued the interest of insurance companies and provident funds seeking avenues to invest their long-term funds.

    Why such move?

    • Ambitious Target: India aims to mobilize â‚č6.55 trillion ($78.73 billion) through bond sales from October to March. This includes a significant â‚č300 billion allocation to the 50-year security, marking the central government’s maiden auction of such bonds.
    • Natural Demand: Long-term investors, particularly insurers, find the 50-year bonds appealing due to their alignment with asset-liability management requirements.

    Government Bonds in India

    • Government Bonds in India, fall under the broad category of Government Securities (G-Sec) and are primarily long term investment tools issued for periods ranging from 5 to 40 years.
    • It can be issued by both Central and State governments of India. Government bonds issued by State Governments are also called State Development Loans (SDLs).
    • The GB interest rates, also called a coupon, can either be fixed or floating and disbursed on a semi-annual basis.
    • In most cases, GOI issues bonds at a fixed coupon rate in the market.

    Types:

    Fixed-Rate Bonds Offer a fixed interest rate throughout the investment tenure, providing clarity with the coupon rate mentioned.
    Floating Rate Bonds (FRBs) Subject to periodic interest rate adjustments, often with a base rate and fixed spread determined through auctions.
    Sovereign Gold Bonds (SGBs) Allow investments in gold without physical possession, with tax-exempt interest and prices linked to gold’s value.
    Inflation-Indexed Bonds Adjust both principal and interest based on inflation, using indices like CPI or WPI, tailored for retail investors.
    7.75% GOI Savings Bond Features a 7.75% interest rate and available to individuals, minors with legal guardians, and Hindu Undivided Families.
    Bonds with Call/Put Option Permit either issuer or investor to buy back or sell bonds, respectively, on specified dates, after 5 years from issuance.
    Zero-Coupon Bonds Generate earnings from the difference between issuance and redemption prices, as they do not provide interest income.

    Advantages offered

    • Sovereign Guarantee: Government bonds are backed by the government’s commitment, offering stability and assured returns.
    • Inflation-Adjusted: Inflation-indexed bonds protect investors from rising prices, maintaining the real value of their investments.
    • Regular Income: Government bonds provide semi-annual interest disbursements, offering investors a source of regular income.

    Limitations

    • Lower Income: Apart from 7.75% GOI Savings Bonds, government bonds typically offer lower interest rates.
    • Lack of Relevance: With maturity tenures ranging from 5 to 40 years, government bonds may lose relevance over time, particularly in the face of inflation.

  • In news: Dadasaheb Phalke Award

     Central Idea

    • Union Information and Broadcasting Minister announced that veteran actor Waheeda Rehman would be given the Dadasaheb Phalke Lifetime Achievement Award for 2021, honouring her stellar contribution to Indian cinema.

    About Dadasaheb Phalke Award

    Purpose Highest honor in Indian cinema for outstanding contributions to its growth and development.
    Inception Instituted by the Indian government in 1969.
    Named After Dhundiraj Govind Phalke, “Father of Indian Cinema.”
    Components ‘Swarna Kamal’ (Golden Lotus), INR 10 lakh cash prize, certificate, silk scroll, and shawl.
    Presentation By the President of India in the presence of key film industry representatives and officials.
    First Recipient Devika Rani Roerich (1969).

    Who was Dadasaheb Phalke?

    • Early Life: Dhundiraj Govind Phalke, born in 1870 in Trimbak, Maharashtra, had a diverse career. He initially studied engineering and sculpture and later developed a fascination for motion pictures after watching the 1906 silent film ‘The Life of Christ.’
    • Varied Pursuits: Before entering the world of cinema, Phalke worked as a photographer, owned a printing press, and even collaborated with the renowned painter Raja Ravi Varma.
    • Filmmaking Pioneer: In 1913, Phalke scripted, produced, and directed India’s inaugural feature film, the silent masterpiece ‘Raja Harishchandra.’ This groundbreaking film’s commercial success marked the beginning of Phalke’s prolific career in which he created 95 more films and 26 short films over the next 19 years.
    • Father of Indian Cinema: Dhundiraj Govind Phalke is hailed as the “Father of Indian Cinema” for his pioneering contributions to the country’s film industry.

  • Balsams blossom in Munnar

    Central Idea

    • The genus Impatiens, locally known as Kasithumba and Onappovu, is currently enchanting tourists with its vibrant pink blooms in Munnar.

    What are Balsams?

    • Distinctive Feature: Balsams are commonly referred to as ‘touch-me-not’ due to the unique behavior of their mature seeds bursting open upon touch and distributing seeds.
    • Sign of Active Micro-Climate: Botanists suggest that the extensive flowering of balsams in Munnar indicates the continued activity of the microclimate in this hill station.
    • Indian Balsam Species: India hosts a total of 220 balsam species, with a significant presence of 135 species in the southern Western Ghats.
    • Balsam Paradise: Idukki, particularly the high ranges around Anamudi, is renowned for its rich diversity of wild balsams. Scientists often term the district as a ‘balsam paradise.’

    Conservation Efforts

    • Balsams in Munnar: Munnar boasts 46 balsam species, extending from Munnar to Chinnar and Bison Valley.
    • Protection in National Park: The Eravikulam National Park alone is home to over 40 wild balsam species, with the Forest Department ensuring their protection.
    • Unparalleled Diversity: Prasad G, working plan officer, highlights that Munnar’s altitude has unveiled 46 balsam species, a level of diversity unmatched elsewhere in the world.
    • Indicator Species: Balsams play a crucial role as indicator species for climate change. Any alterations in the climate of a region are often reflected in the population of these plants.

  • Centre seeks to ease Angel Tax Provisions

    Central Idea

    • The government has introduced revisions to the angel tax provisions that were initially implemented in this year’s Budget, primarily targeting investments by non-resident investors into startups at a premium over their fair market value.

    Key changes introduced

    • The Central Board of Direct Taxes issued a notification, amending Rule 11UA under the Income Tax Act, incorporating changes to the draft norms released earlier.
    • Five distinct valuation methods for shares have been introduced, accompanied by a 10% tolerance allowance for deviations from accepted share valuations.
    • These changes aim to provide some relief to prospective foreign investors interested in Indian startups.

     

    Angel Investment

    • An angel investor is an individual who provides financial backing to early-stage startups or entrepreneurs, typically in exchange for equity in the company.
    • Angel investors are typically high-net-worth individuals who invest their own personal funds, rather than investing on behalf of a firm or institution.
    • Features of Angel Investing:
    1. Early-stage funding
    2. Equity investment
    3. High-risk, high-reward
    4. Active involvement
    5. Personal investment
    6. Flexible terms
    7. Shorter investment horizon

     What is Angel Tax?

    • Referred to as Angel Tax, this rule is described in Section 56(2)(viib) of the Income Tax Act, 1961.
    • Essentially it’s a tax on capital receipts, unique to India in the global context.
    • This clause was inserted into the act in 2012 to prevent laundering of black money, round-tripping via investments with a large premium into unlisted companies.
    • The tax covers investment in any private business entity, but only in 2016 was it applied to startups.

    Why was angel tax introduced?

    • The complicated nature of VC fundraising with offshore entities, multiple limited partners and blind pools is contentious.
    • There has been some element of money laundering or round-tripping under guise.

    Details of its levy

    • The Angel Tax is being levied on startups at 9% on net investments in excess of the fair market value.
    • For angel investors, the amount of investment that exceeds the fair market value can be claimed for a 100% tax exemption.
    • However, the investor must have a net worth of â‚č2 crores or an income of more than â‚č25 Lakh in the past 3 fiscal years.

  • Southwest Monsoon begins early Withdrawal/Retreat

    monsoon

    Central Idea

    • India Meteorological Department (IMD) has announced withdrawal of the monsoon.

    What is Monsoon Withdrawal/Retreat?

    • In India, retreating monsoon is the withdrawal of south-west monsoon winds from North India.
    • The withdrawal is gradual and takes about three months.
    • With the retreat of the monsoons, the clouds disappear and the sky becomes clear. The day temperature starts falling steeply.
    • Monsoon rains weaken all over India except few southeastern states.
    • It is helpful in Rabi crop cultivation.

    Factors affecting the retreat

    Two predominant factors cause the phenomenon:

    (1) Land topography

    • First, the low mountain range in each region runs from north to south, shielding it from west-bound winds that trigger summer monsoon.
    • After summer, the range aids in the ‘orographic lift’ or rising of east-bound air mass from a lower to higher elevation, forming clouds and resulting in rain.

    (2) Atmospheric convection

    • The second factor is atmospheric convection or vertical movement of air.
    • As the earth is heated by the sun, different surfaces absorb different amounts of energy and convection may occur where the surface heats up very rapidly.
    • As the surface warms, it heats the overlying air, which gradually becomes less dense than the surrounding air and begins to rise.
    • This condition is more favorable from September to February because of the role played by sea surface temperature or water temperature.

    Immediate factors influencing withdrawal

    • The withdrawal of the monsoon is based on meteorological conditions such as-
    1. Anti-cyclonic circulation (dry air that is the opposite of a cyclone)
    2. Absence of rain in the past five days and
    3. Dry weather conditions over the region

    When does it occur?

    • The monsoon withdrawal is a long-drawn process and extends into mid-October, though the IMD considers September 30 to be the final day of the season over India.
    • The rain after that is categorised as “post-monsoon” rainfall.

  • How Indians and their Boats fared in the Deep Sea?

    boat

    Central Idea

    • A groundbreaking 21-meter-long ship, constructed using an age-old technique of stitching wooden planks with ropes, cords, coconut fibers, natural resins, and oils, is scheduled to embark ‘Baliyatra’ from Odisha to Bali, Indonesia.
    • The initiative, led by the Govt. of India, aims to rekindle the nation’s rich maritime tradition and heritage.
    • This remarkable journey will be manned by a crew from the Indian Navy.

    Early Evidence of Maritime Trade

    • Ancient Maritime Trade: The presence of maritime trade networks dating back to circa 3300-1300 BCE is supported by evidence from the Indus Valley, Mesopotamia, and coastal sites along the Arabian Sea. The engineering marvel of the dock at Lothal in Gujarat stands as a testament to the Indus civilization’s profound understanding of tides and winds.
    • Historical Accounts: Ancient texts, including the Vedas (circa 1500-500 BCE), contain vivid accounts of seafaring adventures and the associated risks. Furthermore, the Jataka Tales (circa 300 BCE-400 CE) and Tamil Sangam literature (circa 300 BCE-300 CE) provide explicit references to maritime activities.

    Challenges in Recognizing Maritime Heritage

    • Historiographical Biases: Historians have often marginalized India’s maritime heritage in favor of narratives centered on land-based polities. This bias has led to the neglect of India’s maritime contributions.
    • Emergence of Deep-Sea Voyages: The 1st century BCE witnessed intensified mid-ocean voyages driven by the Roman Empire’s demand for Eastern commodities, which harnessed monsoon winds and marked a significant turning point in maritime activity.

    Ancient Indian Boats and Shipbuilding

    • Limited Knowledge: The field of marine archaeology in India remains at an early stage of development, with primary insights derived from boat-building traditions, artistic depictions, and literary sources.
    • Traditional Boat-Building Techniques: Indian boat construction traditions favor stitching planks of wood together instead of using nails. These traditions encompass coir-stitched, jong (Southeast Asian), and Austronesian methods, each employing various stitching techniques.
    • Wood Selection: Selection of wood types for shipbuilding depended on their suitability for specific ship components. Mangrove wood excelled in creating sturdy dowels, while teak was preferred for planks, keels, stem, and stern posts.

    India’s Role in Maritime Trade

    • Trade Lake of the Indian Ocean: By the Common Era, the Indian Ocean had evolved into a thriving trade network, with India positioned at its heart. This network facilitated trade connections between India and Europe via the Middle East and Africa in the west, as well as Southeast Asia, China, and Malaysia in the east.
    • Evidence of Scale: Estimates indicate the colossal scale of trade, with customs taxes collected from the Red Sea trade route alone contributing significantly to the Roman exchequer.

    Uncovering a Hidden Past

    • Ongoing Exploration: Recent excavations have provided substantial insights into India’s maritime history. Nevertheless, experts acknowledge that numerous discoveries await on this journey of exploration.
    • Need for Investment: Marine archaeology in India requires increased funding and recognition to unlock its full potential and contribute meaningfully to humanity’s understanding of the past.
    • Value of Knowledge: Scientific archaeology’s pursuit of India’s deep maritime past offers the potential for immense benefits to humanity. Engaging with this history challenges conventional narratives and represents a subversive yet essential endeavor.

    Conclusion

    • The forthcoming voyage of the stitched ship symbolizes India’s dedicated efforts to rejuvenate its maritime heritage, shedding light on the forgotten history of Indian seafarers and their remarkable vessels.
    • Through exploration and study, India seeks to restore the rightful place of its maritime legacy in the annals of history.

  • Tobacco Warnings on OTT Platforms: A Closer Look at the Debate

    tobacco

    Central Idea

    • The Central government’s regulations mandated long-duration smoking warnings for films and TV series on OTT platforms like Hotstar, Amazon, and Netflix.
    • Streaming websites voiced objections, raising concerns about user experience.

    Recent Development

    • According to a recent report, the government has agreed to find “pragmatic solutions” for stricter tobacco warnings on OTT platforms.
    • A closed-door meeting saw streaming executives engage with Health Ministry and Information and Broadcasting (I&B) Ministry officials.

    Why Smoking Warnings in Indian Entertainment?

    • Linking Health Impact and Public Perception: The introduction of smoking warnings in Indian entertainment stems from the connection between smoking’s health impact and its portrayal to the public. The goal is to communicate clear information about the health risks associated with smoking and discourage its use.
    • Regulation Evolution: The Indian government has a history of regulating how smoking is portrayed. The Cinematograph Act of 1952 prohibited the “glamorization” of tobacco in movies, and the Cable Television Networks Amendment Act of 2000 banned tobacco and alcohol advertising on cable TV.

    Historical Context

    • Factors Leading to Consensus: Several factors contributed to a growing national consensus on tobacco control, including increased health awareness, new laws and enforcement, judicial rulings (e.g., the 2008 ban on public smoking), civil society efforts, global support for tobacco control, and the influence of the World Health Organization.
    • COTPA and Health Ministry Notification: Under the Cigarettes and Other Tobacco Products Act (COTPA), signed into law in May 2003, the Health Ministry introduced a notification prohibiting the display of tobacco products in cinema and television programs.
    • Content Rules: This notification required films and shows produced before it to include health warnings regarding smoking as a prominent scroll at the bottom of the screen. It also recommended prohibiting smoking in public places and using pictorial health warnings covering 85% of tobacco product display areas.
    • Legal Challenges: Legal challenges arose as some filmmakers and actors argued that these rules violated their freedom of speech. The Delhi HC quashed the notification in 2009, but the Supreme Court later upheld the rules.

    Introduction of Health Spots

    • Consensus-Building Efforts: Amid legal disputes, I&B Ministry appointed a new minister, leading to attempts to reach consensus. In 2011, the Health Ministry introduced new rules after consultations with I&B Ministry, aiming to make them more practical and implementable.
    • Health Spots in Old Content: For films and shows made before these rules, anti-tobacco health spots or messages were required at the beginning and middle of television programs, made available to the Central Board of Film Certification (CBFC).
    • Requirements for New Content: New films and TV shows with smoking scenes were to provide an “editorial justification” to the CBFC, include anti-tobacco health spots, display a prominent static message during tobacco product scenes, and feature an audio-visual disclaimer on the ill effects of tobacco use.

    Implementation Challenges

    • A study revealed that while many movies implemented at least one element of the film rules on tobacco imagery, few fully complied.
    • Compliance with other aspects of COTPA, such as restrictions on selling cigarettes near schools, has also been lacking.

    Debate over OTT Smoking Warnings

    • Content Library Concerns: I&B Ministry which regulates streaming platforms, expressed concerns about implementing warnings in existing content, foreign content, and health spots. It suggested displaying an appropriate health warning when users log in.
    • OTT Industry Concerns: In May, India ordered OTT platforms to insert static health warnings and anti-tobacco disclaimers. OTT executives raised concerns about the potential need to edit vast amounts of existing content, impacting user experience and creators’ freedom of expression.

  • RBI asks for SARFAESI Act Compliance

    Central Idea

    • The RBI has issued a directive requiring commercial banks and Non-Banking Financial Companies (NBFCs), collectively referred to as Regulated Entities (REs), to disclose borrower information.
    • This disclosure pertains to borrowers whose secured assets have been repossessed under the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (SARFAESI Act).

    What is the SARFAESI Act?

    • Objective: The SARFAESI Act, introduced in 2002, is formally known as the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act. Its primary objective is to protect financial institutions against loan defaults.
    • Empowering Banks: The Act empowers banks to seize, manage, or sell securities pledged as collateral for loans, facilitating the recovery of bad debts without the need for court intervention.
    • Broad Application: The SARFAESI Act applies nationwide and covers all types of assets, whether movable or immovable, provided as security to lenders.

    Aim of the SARFAESI Act

    The SARFAESI Act serves two key purposes:

    1. Efficient NPA Recovery: It streamlines and expedites the recovery of non-performing assets (NPAs) for financial institutions and banks.
    2. Asset Auction: It enables financial organizations and banks to auction residential and commercial assets in cases of borrower default.

    Why was such a Law needed?

    • Pre-SARFAESI Era: Before the enactment of the SARFAESI Act in December 2002, financial institutions and banks faced complex procedures for recovering bad debts.
    • Legal Complexity: Lenders had to navigate legal complexities, resorting to civil courts or designated tribunals to secure ‘security interests’ for recovering defaulted loans, resulting in slow and cumbersome debt recovery.

    Powers Granted to Banks under the Law

    • Default Trigger: The SARFAESI Act comes into play when a borrower defaults on payments for more than six months.
    • Notice Period: The lender is required to issue a notice to the borrower, providing them with a 60-day window to clear their outstanding dues.
    • Asset Possession: If the borrower fails to comply within the stipulated period, the financial institution gains the right to take possession of the secured assets and manage, transfer, or sell them.
    • Appellate Avenue: The defaulter has the option to appeal to an appellate authority established under the law within 30 days of receiving a notice from the lender.

    SARFAESI Act: Applicability

    The SARFAESI Act primarily deals with various legal aspects related to:

    • Registration of asset reconstruction companies.
    • Acquisition of rights or interest in financial assets.
    • Measures for asset reconstruction.
    • Resolution of disputes.

  • OSIRIS-REx Mission Returns to Earth with Asteroid Samples

    osiris-rex

    Central Idea

    • The NASA OSIRIS-REx mission has achieved a significant milestone by successfully returning to Earth with an estimated 250 grams (8.8 ounces) of material gathered from the surface of an asteroid.
    • These precious samples hold the potential to provide critical insights into differentiating authentic asteroid-origin materials from potential terrestrial contaminants or alterations across various meteorite types.

    OSIRIS-REx Mission

    (a) Mission Launch and Journey:

    • OSIRIS-REx embarked on its journey when it was launched from Cape Canaveral, Florida, in 2016.
    • Over a span of two years, it traversed space to reach Bennu, a carbon-rich asteroid nestled between Earth and Mars.

    (b) Orbiting Bennu:

    • The spacecraft reached its destination, Bennu, in December 2018.
    • It spent two years in orbit around the asteroid, conducting a comprehensive suite of measurements.
    • These measurements encompassed critical aspects such as Bennu’s mass, density, albedo, surface composition, and particle environment.
    • The landing site chosen on Bennu was named “Nightingale.”

    (c) Notable Discoveries:

    • During the reconnaissance phase, the OSIRIS-REx mission uncovered several intriguing findings:
    • Bennu is classified as an active asteroid, periodically ejecting material from its surface.
    • The surface of Bennu exhibited a considerably rougher terrain than initially expected, featuring numerous boulders exceeding ten meters in diameter.
    • Bennu’s bulk density was found to be lower than anticipated, suggesting the presence of substantial empty space within the asteroid’s structure.
    • Surface features on Bennu indicated signs of past aqueous activity, and the asteroid’s rotation was observed to be accelerating due to the YORP effect.

    Previous such missions

    • Previous space missions like Japan’s Hayabusa and Hayabusa2, as well as China’s Chang’e 5, have made substantial contributions to our understanding of celestial bodies and their compositions.
    • The return of asteroid samples by OSIRIS-REx marks NASA’s first sample return mission since Stardust in 2006 and Genesis in 2004.

    Significance of Sample Return

    • The return of material directly from celestial sources, such as asteroids, comets, the solar wind, and the Moon, holds immense scientific significance.
    • It provides the means to answer questions that lie beyond the scope of remote observations, landers, rovers, or even meteorites.
    • Collecting samples directly from the source ensures the preservation of intricate details that may otherwise be lost during a meteorite’s passage through Earth’s atmosphere and subsequent impact.

  • Documented Tripitaka: Tracing Buddhism’s Sri Lanka Connection

    tripitaka

    Central Idea

    • A team from Buddhavanam Theme Park in Hyderabad embarked on a significant visit to Sri Lanka.
    • Their destination: the third-century BC Buddhist rock-cut caves at Mathale, situated on the Colombo-Kandy route.

    Why such move?

    • The team noted that the teachings of Lord Buddha, known as Tripitaka (Sutra, Vinaya, and Abhidhamma pitakas), were originally transmitted orally.
    • However, it was under the auspices of Sri Lankan king Devanampiya Tissa, a contemporary of King Asoka, that these teachings were written on palm leaves in Sri Lanka.
    • This event marked the advent of Buddhist literature in India.

    About Tripitaka

    • The Tripitaka, also known as the Pali Canon, is a collection of sacred Buddhist scriptures that form the foundational texts of the Theravada Buddhist tradition.
    • It is divided into three sections, known as the Tripitaka, which literally means “Three Baskets.”

    History and significance

    • The Tripitaka was orally transmitted from the time of Gautama Buddha in the 5th century BCE until it was eventually written down in the 1st century BCE.
    • It holds immense historical and religious significance as it contains the teachings, discourses, rules, and guidelines given by the Buddha and his prominent disciples.

    Composition of the Tripitaka:

    (1) Vinaya Pitaka (Basket of Discipline):

    • Comprises the rules and guidelines for monastic discipline in the Buddhist community.
    • Provides detailed instructions on the conduct and behavior expected from monks and nuns.
    • Covers various aspects, including ethical guidelines, disciplinary codes, and procedures for resolving disputes.
    • Offers insights into the monastic life, the organization of the Sangha (monastic community), and the role of the monastic code in maintaining harmony and ethical conduct.

    (2) Sutta Pitaka (Basket of Discourses):

    • Contains the discourses and teachings delivered by Buddha and his close disciples.
    • Includes a vast collection of discourses covering a wide range of topics, such as ethics, meditation, philosophy, and social issues.
    • Consists of individual Suttas (discourses) grouped into different collections or Nikayas, such as the Digha Nikaya (Long Discourses), Majjhima Nikaya (Middle-Length Discourses), Samyutta Nikaya (Connected Discourses), and Anguttara Nikaya (Numerical Discourses).
    • Presents the Buddha’s profound teachings on the Four Noble Truths, the Noble Eightfold Path, dependent origination, and other core concepts of Buddhism.

    (3) Abhidhamma Pitaka (Basket of Higher Teachings):

    • Provides a comprehensive and systematic analysis of Buddhist philosophy and psychology.
    • Explores the nature of mind, consciousness, and reality in intricate detail.
    • Presents the teachings in a more technical and analytical manner, offering an advanced understanding of Buddhist concepts.
    • Divided into seven books, known as the Abhidhamma books, which delve into topics such as consciousness, mental factors, elements, and the path to liberation.
    • Offers a deep exploration of the ultimate nature of existence and the workings of the mind.

    Features and Characteristics

    • Authenticity and Authority: The Tripitaka is regarded as the most authoritative and authentic collection of Buddhist scriptures in the Theravada tradition.
    • Canonical Language: The texts are primarily written in Pali, an ancient Indian language close to the language spoken during the Buddha’s time.
    • Extensive Coverage: The Tripitaka covers a wide range of topics, offering comprehensive guidance for practitioners in various aspects of life.
    • Preservation of Early Buddhist Teachings: The Tripitaka is believed to preserve the original teachings of the Buddha, providing insights into his wisdom and teachings.