9 PM Daily Current Affairs Brief – September 2nd, 2021

Dear Friends,
We have initiated some changes in the 9 PM Brief and other postings related to current affairs. What we sought to do:

  1. Ensure that all relevant facts, data, and arguments from today’s newspaper are readily available to you.
  2. We have widened the sources to provide you with content that is more than enough and adds value not just for GS but also for essay writing. Hence, the 9 PM brief now covers the following newspapers:
    1. The Hindu  
    2. Indian Express  
    3. Livemint  
    4. Business Standard  
    5. Times of India 
  3. We have also introduced the relevance part to every article. This ensures that you know why a particular article is important.
  4. Since these changes are new, so initially the number of articles might increase, but they’ll go down over time.
  5. It is our endeavor to provide you with the best content and your feedback is essential for the same. We will be anticipating your feedback and ensure the blog serves as an optimal medium of learning for all the aspirants.
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Mains Oriented Articles 

GS Paper 1

GS Paper 2

GS Paper 3

Prelims Oriented Articles (Factly) 

Mains Oriented Articles

GS Paper 1

Enlarge the Panchsheel approach to tribal upliftment

Source:  This post is based on the article “Enlarge the Panchsheel Approach for Tribal upliftment” published in the Livemint on 2nd  September 2021.

Syllabus: GS 1 – Effects of globalization on Indian society

Relevance: This article explains India’s Tribal development policy.

Synopsis: Despite Indian independence, tribal development is lacking in India.

Introduction

This article highlights the problems/ difficulties faced by tribals because of globalisation.

Impact of Globalisation on Tribals

Livelihood: It forced tribes to give up their traditional occupations. Now, most of them work as migrants, daily wageworker in unorganized sectors.

Culture: It severely impacted their ancient culture. Globalisation unrestrained interactions between tribal populations. This has resulted in indigenous culture being suppressed.

What is Panchsheel? How it will address tribal Issues?

To address the issues of Tribals, Jawahar Lal Nehru advocated “Panchsheel” for Tribal development. The major components of the Panchsheel are:

Self-Governance: It advocates the non- imposition of outside rule/culture from external agencies by encouraging self-governance. It affirms that the forest and land rights of tribals must be protected.

Inclusivity: It encourages the inclusion of tribals in development and administration. It additionally mandates that schemes and administrative insurance policies meant for Tribal beneficiaries shouldn’t be cumbersome.

Integration and Development: It requires that the standard of judging progress for Tribals be based mostly on life-quality indices, with an intention to strike a steadiness between isolationism and their assimilation.

What are provisions in the Indian Constitution for Tribal Upliftment?

Part X of the Constitution: It entails provisions for the administration and management of Scheduled Areas and Schedule Tribes (STs).

Article 330 and 332: It reserves seats for ST in Schedule areas, thus granting them representation to safeguard their rights and interests.

89th Amendment: It introduced National Commission for ST, which further derives its power from Article 338 A.

Tribal Advisory Council: It is mandatorily constituted to inculcate the value of self-governance, which is the cornerstone of democracy.

PESA (Panchayat Extensions of Scheduled Areas) Act, 1995: In 1991, after the recommendation of Bhuria committee, the government enacted the PESA. It confers the powers of local self-governance, ownership and management of natural resources to the local Tribal communities.

Read more: Panchayat Extensions of Scheduled Areas(PESA) Act

Recommendation of various Commissions and committees

Kaka Kalekar Commission, 1953: It suggested the recognition of ST as an exclusive group that belongs to no specific religion.

Bandhopadhyay and Mungekar Committee: It was constituted to examine governance issues in Schedule areas affected by extremism.

Xaxa Panel, 2014: It was constituted to look extensively into Tribal livelihood, employment, health, migration and legal matters. This committee observed that the PESA and the Forests Rights Act are slow to absorb the rapidly evolving circumstances of tribals.

There are some more committees constituted for tribal reforms like Elwin panel 1959, UN Debar Commission 1960, Lokur Committee 1965, Shilu Ao Panel 1965. These all are largely focused on Tribal development, governance mechanism and welfare system.

What are the Supreme Court rulings for Tribal rights?

The judiciary acts as a torchbearer of Tribal rights in its role as Panchsheel enforcer.

In Samatha vs state of Andhra Pradesh 1977: It held that granting of mining lease in Schedule areas by state amounts to transfer of land to “non-tribal” is in violation of the Fifth schedule.

In Orissa Mining Corporation vs Ministry of Environment and Forests: The SC held that forest dwellers and STs have a right under FRA (Forest Right Act) to be consulted before their ancient homelands are converted into commercial lands.

What are the government’s efforts?

‘Stand Up India’ scheme 2021: It is launched by SIDBI (Small Industries Development Bank of India). It seeks to provide loans to ST ranging from 10 lakh to 1 crore to set up enterprises.

Budget 2021-22: I reduced the margin money requirement for loans from 25% to 15%. It also allows credit for agricultural allied activities.

A proposal has been made for building 750 Eklavya model Residential schools in Tribal majority areas to inculcate heritage-based education. It will also focus on vocational skill training.

What more can be done?

Despite seven decades of independence, several constitutional and legal safeguards, the condition of tribal leaves much to be desired.

India’s ratification of the International Labor Convention’s 1989 convention on Rights of Indigenous people which recognizes their rights on land and natural resources can be the pragmatic step that may use in the development of Tribal people.


GS Paper 2

Where liberalism and nationalism are placed in Asia

Source: This post is based on the article “Where liberalism and nationalism are placed in Asia” published in The Hindu on 2nd September 2021.

Syllabus: GS 2– Important aspects of governance

Relevance: This article explains India’s presence in the South China Sea.

Synopsis

Liberalism and nationalism mean different things to different people, and the two concepts are often considered mutually exclusive.

Introduction

Nationalism may take various forms but essentially, it is about collective identity, whereas liberalism implies the defence of individual freedom and self-determination.

The liberal tradition contributes the ideas such as free trade, international law, multilateralism, environmental protection and human rights. But the problems arise when such ideas become a doctrine for nation-building.

What is the difference between nationalism and liberalism?

Nationalism may take various forms but essentially, it is about collective identity, whereas liberalism implies the defence of individual freedom and self-determination.

Liberalism can underpin universal rights and Adam Smith’s natural laws of economics. But its appeal is mainly to the professional, educated class and lacks nationalism’s emotional appeal.

How was nationalism in India got shaped during independence?

Before Indian independence, nationalism was regarded with suspicion. For instance, Rabindranath Tagore had considered it a malign ideology and supported the values of internationalism and universalism. On the other hand, VD Savarkar supported Hindutva nationalism with Buddha’s universalism.

On the other hand, Jawaharlal Nehru saw merit in nationalism. For instance, in 1953, he mentioned, “nationalism has been and is a very good thing. It has been a great liberating force in certain stages of a country’s history”. But he also feared that extreme nationalism could degenerate into fascism and expansionism.

How the Asian Democracy is different from Western Democracy?

Democracy in Asia is not shaped by the liberalism of the West. The centrality of civil and political rights is less and a degree of state intervention is considered acceptable when it comes to individual autonomy.

How will nationalism and liberalism be reflected in a future Asia?

Both India and China were at the receiving end of western imperialism and emerged as supporters of principles of international society reflected in the Panchsheel, namely sovereignty, territorial integrity and non-interference.

The two leading Asian nations, India and China, used the present world system to their rise while protesting against the control of the United Nations and world financial institutions.

But they both have not formulated any alternative based on Asian nationalism. Their current rivalry makes any such formulation an impossible one.


Better policing, please: Court observations on investigations in Delhi riots should be required reading for all major police forces

Source: This post is based on the article “Better policing, please: Court observations on investigations in Delhi riots should be required reading for all major police forces” published in The Times of India on 1st September 2021.

Syllabus: GS 2Police reforms

Relevance: Understand lapses in the police investigation.

Synopsis: There are few major lapses in the police investigation. These can be corrected by paying heed to the advice of the Delhi court.

Introduction

Recently, the police investigation in the February 2020 riots case has come under the scanner of Delhi Trial Courts. These critical observations have to be considered seriously during the police investigations in the country.

What are the judicial observations about the police investigations?

Inconsistency: The courts noted many inconsistencies in witness statements, which should have been noted by police during their investigation.

Poor Evidence: In multiple bail orders, judges have cited poor evidence as to their reason for granting bail. For example, in the context of the Delhi High court’s bail for three anti-CAA activists in June, despite they have been charged with the UAPA (Unlawful Activities Prevention Act), the police were not able to produce strong convicting evidence.

Policing methods: Courts are also finding basic lapses in policing methods. E.g. In one case involving acid burn injuries to police personnel, police did not collect chemical samples from the crime scene for forensic analysis.

The behaviour of investigating officers: Investigating officers are not briefing prosecutors properly or answering their queries.

Methods of framing charges: In some cases, investigation appeared “inefficient” and “unproductive”. Police are framing charges of vandalism without thinking how such evidence and the investigation will withstand a higher degree of scrutiny during trials. For example, in a riot victim’s gunshot injury complaint, police had clubbed this case with incidents from other localities of some other day.

How can the investigation be improved?

If Police all over India pay close attention to the Delhi court’s observations, investigation processes can be made efficient, which will help in the quick delivery of Justice.


The Paralympic paradox

Source: This post is based on the article “The Paralympic paradox” published in the Business Standard on 1st September 2021.

Syllabus: GS-2 Mechanisms, Laws, Institutions and Bodies constituted for the protection and betterment of vulnerable sections

Relevance: Paralympics empowering disabled people.

Synopsis: Indians with disabilities need more attention.

Introduction

Indian athletes have given their best performance in Paralympics 2021. It gives a platform for disabled people to perform and shine. But, at the same time, it shows the embarrassing truth about Indian society that neglect disabled people.

Read more: Making the Paralympics count

India has been participating in the Paralympics since 1988, but their coverage has been rarely featured in India in any significant way. Rarely, people knew about their achievements. It is time that we understand the issues faced by disabled people and work on them.

What are the government’s efforts to improve Paralympic athletes performance?

Khelo India Scheme: The government introduced this scheme in 2017. Three sports bodies were recognized under this, including a Paralympic Committee of India. Its aim is to provide differently-abled sportspeople access to more special facilities and coaching centres.

Read more: Khelo India Scheme

TOP (Target Olympic Podium) Scheme: The scheme offers support for high potential para-athletes.

Read more: TOP Scheme
What will be the impact of Private Sector Cooperation?

Greater interest from the private sector, which has been the driving factor behind the commercial success of sporting events.

There is positive momentum in this direction, as automobile makers have now decided to design special vehicles for two of the medal winners.

Apart from that, Toyota also signed a sponsorship with the Worldwide Paralympic Partner.

How should we start?

A government report recently pointed that only half of the disabled people in India have a disability certificate, effectively depriving the other half of all the government benefits. A good first step would be ensuring the issuance of disability certificates to all.


Three doses not two: Israel sets new benchmark for full vaccination. It is on India’s horizon as well

Source: This post is based on the article “Three doses not two: Israel sets new benchmark for full vaccination. It is on India’s horizon as well” published in the Times of India on 1st September 2021.

Syllabus: GS 2 – Issues relating to development and management of Social Sector/Services relating to Health

Relevance: To understand the immunization process.

Synopsis: With Israel adopting a 3 dose policy, what should be India’s policy going forward?

Introduction

Recently, Israel stated that every Israeli over 12 years is now entitled to a booster shot after the second dose. Other countries from the UK to Indonesia are also planning to offer booster doses to vulnerable groups.

Why has Israel adopted this Policy?

It is well known that antibody responses weaken over time, especially with new viruses rapidly mutating and producing new versions.

An Oxford University study of 3,391,645 test results found that – 92% and 69% efficacy is seen two weeks after the second Pfizer and AstraZeneca doses. However, after 90 days efficacy slips to 78% and 61% respectively.

What should India do?

With more than 65.26 crore vaccine doses administered, multiple studies will be helpful in getting an optimal handle on complex efficacy issues. For Covishield, India can take inputs on policymaking from international studies. For Covaxin, we have our own data.

Regarding the third dose, ICMR (Indian Council of Medical Research) must take the lead and conduct field-level studies.

What should be the priority of India?

For India, the first priority is giving two doses to all adults. India must ramp up the vaccine supply and vaccinating all eligible Indians with two doses before formulating a policy for 3 doses. To achieve that, large hospitals also need to step up vaccination drives.


What the global flow of guns tell us about how states fail

Source: This post is based on the article “What the global flow of guns tell us about how states fail” published in Indian Express on 2nd  September 2021.

Syllabus: GS 2- Effect of Policies & Politics of Developed & Developing Countries on India’s Interests

Relevance: Understand the role of arms in society.

Synopsis: The supply of weapons matters. If not controlled, then the weapons guide the nation in a different direction. The Taliban takeover of Afghanistan is the latest example.

Introduction

The global flow of guns serves as a very useful indicator of the flow of power and money. This can be understood from numerous historical examples.

What are the historical examples of weapons flow and gun control?

Colonial countries: In Asia, colonial empires used guns for their own self-protection. But, the British controlled colonies by disarming citizens.

The British Empire in India not just dispossessed Indians of weapons, it also disarmed them of indigenous knowledge in weapon-making that had begun to emerge in the 17th century.

For instance, the Arms Act 1878 tightly controlled arms ownership in India. It was an exercise of colonial and racial subordination that even Gandhi wanted to overturn.

The example of America: It has ensured that places it intervenes, are flooded with weapons. The US has a historical tradition of gun ownership to assert racial privilege. It also has a history of an armed militia winning a war of independence and becoming a modern state.

How do guns inflict violence in society?

Developed countries vs conflict zones: Afghanistan has a death rate of 59.8/1,00,000 resulting from violence and weapons use. Even in Pakistan, it is 5.9 but in countries like the USA and Japan, it is less than 1. This reflects that gun culture breeds violence and tends to persist in society.

India: India has followed the British policy of arms control, fearing rebellion by people. In 1959, India enacted restrictive arms laws to control lower-class rebellion.

What is the Small Arms Treaty?

It is the Treaty adopted by UN General Assembly in 2013. The Treaty aimed to establish the highest possible common standards for regulating conventional arms, and prevent their diversion and illicit trade.

US: has withdrawn from the Treaty because of an ideological commitment to exporting weapons.

India: India is not a member, as it thinks that the Treaty protects arms exporters more than importers.

This shows that major powerful countries are not keen on controlling the flow of weapons as it gives them economic benefits along with the power to influence other countries. Overall, the Treaty is not strong enough on arms transfers to non-state actors, which is where a significant part of the problem lies.

What do we learn from the history of weapons flow?

It is true that weapons are needed to control violence. But peaceful societies cannot be built by the indiscriminate proliferation of weapons.

 


GS Paper 3

India must commit to net zero emissions

Source: This post is based on the article “India must commit to net zero emissions” posted in The Hindu on 2nd September 2021.

Syllabus: GS3 – Conservation, Environmental Pollution and Degradation, Environmental Impact Assessment.

Relevance: Need for India to commit to net zero emissions.

Synopsis: While all the major economies and big corporates are shifting towards net zero emissions, India is yet to commit to the same. It offers India an opportunity to scale up its efforts for mitigation and adaptation to climate change.

Introduction

With over 50% of the global economy already committed to net zero emissions by 2050 — and China committing to be so before 2060, India is at the risk of being cast globally as an outlier on climate action. The pace and scale of climate action is only set to increase, with the recent Intergovernmental Panel on Climate Change (IPCC) report calling for urgent and stronger responses.

A transition towards net zero emissions offers various opportunities for India, as highlighted below.

What are the opportunities for India?

Large scale investment–  Last year, investors injected over $500 billion into climate transition.

Being part of the global community– Over 100 countries have already committed to net zero emissions by 2050, with more expected at COP26.

Must Read: Net Zero Emissions target for India – Explained
Why India must commit to net zero emissions?

Vulnerability to climate change– India is among the most vulnerable countries to climate change and, therefore, should be among the more active against the threats. It faces harmful impacts related to sea level rise, heat stress, drought, water stress and flooding, biodiversity and natural disasters.

Responsibility as rising power–  As a rising power, India naturally seeks stronger influence globally. India is already the third-largest emitter in the world, which calls for more commitment.

Affect India’s international diplomacy– India’s lack of commitment to net zero emissions will cast a negative shadow on its international diplomacy. This applies not just to key relationships like with the U.S., but also with much of the Group of 77 (G77) states.

Boosting economic growth– There is no longer a trade-off between reducing emissions and economic growth. The U.K. has reduced emissions over 40% and grown its economy over 70% since 1990.

Increasing agricultural productivity– Agricultural policy needs to consider adaptive approaches to maximize productivity in light of increased flooding and drought due to climate change.

Gaining advantage in the technologies– The transition of the global economy to net zero emissions is the biggest commercial opportunity in history. Investing heavily thus helps to gain an advantage in the technologies of the new economy, like renewable energy & storage, electric and hydrogen transport, low emissions industry, green cities or sustainable agriculture.

However, India is doing exceptionally well to adapt to climate change, which is evident as below.

India’s efforts to adapt to climate change

Firstly, India is set to significantly exceed its Paris Agreement commitment of reducing the emission intensity of its GDP by 33-35% below 2005 levels by 2030.

Secondly, India is leading with the roll-out of renewable energy and an expanded target for 450GW by 2030.

Thirdly, It is taking leadership on the International Solar Alliance and recent national hydrogen strategy.

Fourthly, Indian corporates are also stepping up, with the Tata Group winning awards on sustainability, Mahindra committing to net zero by 2040 and Reliance by 2035.


How Israel’s expertise in climate innovation can help India

Source: This post is based on article How Israel’s expertise in climate innovation can help India posted in The Indian Express on 2nd September 2021.

Syllabus: GS3 – Conservation, Environmental Pollution and Degradation, Environmental Impact Assessment

Relevance: Lessons from Israel could be used to drive India’s climate actions.

Synopsis: In the backdrop of emerging threats from climate change such as floods, forest fires, torrential rains, giant hailstones etc. our efforts to mitigate and adapt to climate change seems slow. However, Israel’s actions could help us move faster to achieve net zero emission.

Introduction

The average global temperature rise in 2021 is projected to be about 1.2 degrees Celsius above that of the pre-industrial period. The Intergovernmental Panel on Climate Change 2021 analysis shows that the window of opportunity to limit temperature rise to 1.5 degrees Celsius to avoid the worst impacts of climate change is closing. The report is a warning for us.

We need a lifestyle and economy that supports, not disrupts the planet’s climate, nature and environment.

What are potential threats to India?

Melting of glaciers– The Himalayan glaciers, the source of major rivers and aquifers supplying water to hundreds of millions of Indians, are disappearing at an alarming rate.

Risk to low lying areas– Climate change will increase the risks in low-lying coastal zones due to cyclones and coastal and inland flooding, storm surges and sea-level rise.

Impact on Indian agriculture and water resources– The increased frequency of extreme events such as floods and droughts will have a severe impact on India’s agriculture and water resources, food security and the prosperity of rural communities.

India has made enormous investments in renewable energy sources, to increase the use of solar, wind, biomass, waste, and hydropower energies. But there are still enormous challenges in meeting Indian demands for energy, food, and water sustainably. Israel offers lessons for us.

What can we learn from Israel?

In agriculture– Israel has learned to establish agriculture in the desert and arid areas.

In water use–  It recycles 90% of its wastewater, and use desalinate drinking water.

In energy– Israel has developed solutions for energy storage, energy efficiency, and renewable energy. It also promotes energy generation from sea waves, the use of advanced computing tools for energy management.

Animal protein substitutes– it has cultivated a groundbreaking industry of animal protein substitutes. Products such as poultry, milk, eggs and more are being produced in laboratories using methods that emit almost no greenhouse gases. This allows huge swathes of agricultural land currently being used for livestock purposes to be freed up for ecological restoration and reforestation.

Way forward

We need to harness all of humanity’s abilities in order to steer the planet towards a safe position. The only way to do this is by working together, sharing information and experience, and providing mutual support. Israel and India can lead the way to establish state-of-the-art solutions for the developing world in order to mitigate the impacts of climate change.


Let’s talk land sinks: Are they enough to beat global warming

Source: This post is based on article Let’s talk land sinks: Are they enough to beat global warming published in Down to Earth on 2nd September 2021.

Syllabus: GS3 – Conservation, Environmental Pollution and Degradation, Environmental Impact Assessment.

Relevance: Protecting land is important in the fight against global warming.

Synopsis: The world is not on track to reduce GHG emissions at the scale needed to avert a temperature rise of 1.5 °C over pre-industrial levels. The solution, then, is to find ways in which emissions can be removed from the atmosphere and growing trees becomes part of this package.

Introduction

About 56% of the carbon dioxide (CO2) emitted by humans is absorbed by the oceans and land out of which 30% is removed  by land alone. Forests, grasslands and wetlands act as sinks and remove a part of the CO2 emitted through human activities like burning fossil fuels.

On the other hand, land is also a source of emissions —burning of forests and other disturbances add CO2 to the atmosphere.

How does land help in reducing GHG emissions?

According to the Special Report on Climate Change and Land 2019 (SRCCL) by the IPCC, land use accounted for 13% of anthropogenic CO2 emissions during 2007-2016. But it also provided a net sink of around 11.2 gigatons of carbon dioxide per year, equivalent to 29% of the total CO2 emissions in the same period. This means 29-30% human-driven CO2 emissions have been soaked up by the world’s land sinks during the past three decades.

Thus, adding to forests and restoring land can benefit local communities as environmental degradation impacts their livelihoods and impoverishes communities. It highlights the importance of land to mitigate the ill effects of GHG emission.

What are the challenges to the existing forest cover?

Increased heat levels: Increased heat adds to the moisture stress in forests and leading to widespread burning.

Large scale cutting of forests: Forests are being cut for different economic activities, reducing their role as sinks for the CO2 released from fossil fuel burning.

All these concerns and challenges calls for greater international collaboration which is evident from the following.

What are the global efforts to mitigate the challenges?

UNFCCC: The role of land (forests and agricultural land) as a mitigation pathway to reduce CO2 emissions was recognized by the United Nations Framework Convention on Climate Change (UNFCCC) in 1992.

The Kyoto Protocol: In 1997, Kyoto protocol, called on government to enhance the land carbon sink capacities of their territories and to reduce emissions from fossil fuel consumption.

Bonn Challenge: In 2011, the IUCN launched the Bonn Challenge to restore 150 million hectares of the world’s degraded and deforested lands by 2020 and 350 million hectares by 2030.

UN Decade on Ecosystem Restoration: In March 2019, the UN General Assembly declared 2021-2030 as the UN Decade on Ecosystem Restoration to prevent, halt and reverse the degradation of ecosystems worldwide.

One trillion tree initiative: In January 2020, the World Economic Forum in Davos, Switzerland, launched ‘one trillion tree’ initiativeto plant a trillion trees by 2030 and “accelerate nature-based solutions in support of the UN Decade on Ecosystem Restoration (2021-2030)”.

LEAF Coalition: In April 2021, the LEAF (Lowering Emissions by Accelerating Forest Finance) Coalition was announced as a public-private effort led by the US, the UK and Norway. The initiative aims to mobilize at least $1 billion for financing countries committed to protecting their tropical forests. It is supported by corporations like Unilever plc, Amazon.com, Nestle and Airbnb.

In May 2021, the G7 countries pledged to conserve or protect “at least 30% of the global land and at least 30% of the global oceans by 2030 to halt and reverse biodiversity loss and address climate change.”.


Integrity of insolvency processes: A tough ask

Source: This post is based on the article “Integrity of insolvency processes: A tough ask” published in Live Mint on 2nd September 2021.

Syllabus: GS3- Indian Economy and issues relating to Planning, Mobilization of Resources, Growth, Development and Employment

Relevance:  Role of Insolvency bankruptcy code in maintaining the health of financial institutions

Synopsis: Issues hampering the effective implementation of IBC and suggested reforms

Background

There is wide apprehension that the IBC might become a failed attempt to comprehensively tackle corporate sickness or resolve the NPA’s in banking sector

What are the issues hampering the effective implementation of IBC?

Huge delays in special courts

Lack of court capacity

Dubious decisions by resolution professionals

Asymmetrical information on the state of assets shared with different parties

Defaulters trying to control the system for favourable resolutions and steep haircuts

What reforms are needed?

PSBs need to improve their credit appraisal and asset valuation skills: The entire IBC process seems designed primarily to help banks, mainly state-owned, recover their dues. This is well intended design because loan recovery lets banks extend fresh credit that gives economic growth an impetus. Yet, designing a large part of the IBC process for this alone has created structural flaws. Because many public sector banks (PSBs) have carried over their flawed credit appraisal practices to the Committee of Creditors (CoCs) that take charge of insolvent firms for resolution, which tends to impair outcomes.

The issue of frequent legislative amendments and rule changes needs to be addressed: The role of unstable government is another issue impacting resolution process. For instance, sectors such as power, road, telecom and mining projects took on debt on the basis of government policy. But when the state went back on a commitment or changed a policy overnight or failed to pay up on project completion, these sectors were rendered incompetent.

Diversion of Funds needs to be regulated: Many Indian industrial houses have over-borrowed relative to project costs and diverted those proceeds to either finance their own equity contribution or fund something else. With economic slowdown, many of these projects were unable to generate adequate cash flows to service these irrational debts.

Way forward

While reducing concentrations of authority, as the IBBI proposes, could help in several ways, there’s a lot more that ails our system. As a regulator, the IBBI may need to intensify its coordination with other regulators to strengthen its processes. are unlikely to solve some of these deep-seated problems.


Fleeting cheer (On impact of COVID on GDP and the future scenario)

Source: This post is based on the article “Fleeting cheer” published in The Hindu on 2nd September 2021.

Syllabus: GS3- Indian Economy and issues relating

Relevance: Impact of pandemic on growth

Synopsis: The latest GDP estimates show that national output rebounded in Quarter 1. However, the numbers show a different picture when compared with the pre-pandemic first quarter of fiscal 2019-20.

Introduction

National Statistical Office data shows GDP expanded 20.1% from a year earlier. All the eight industries spanning the broad agriculture, manufacturing and services categories posted positive growth. Also, the gross value added grew by 18.8%.

How second wave has impacted the economy?

First, GDP at constant prices was estimated at ₹32.38-lakh crore, a 16.9% contraction from January-March’s ₹38.96-lakh crore and more than 9% of the ₹35.66-lakh crore in April-June 2019.

Second, with the exceptions of electricity and other utility services and the non-contact intensive services grouping of financial, real estate and professional services, all other six industries posted double-digit quarter-on-quarter contractions.

Third, private consumption spending showed year-on-year growth of 19.3% but still shrinking by 17.4% from the preceding three months.

Fourth, government consumption expenditure which has helped shore up the economy in past, contracted 4.8% from a year earlier and 7.6% from the previous quarter.

What opportunities lie ahead for the economy?

Most States have gradually eased their localized second wave restrictions.

Exports have been one of the bright spots as the U.S. and other western economies have posted economic recoveries.

Manufacturing has surged almost 50% year-on-year. As per Manufacturing Purchasing Managers’ Index, the manufacturing sector experienced a second straight month of increase in production.

What are some future challenges?

Rising raw material costs: as per PMI survey, rising raw material costs have been forcing manufacturers to either absorb the impact or raise prices. It is risking the prospect of an already weak demand.

Freeze on hiring: According to IHS Markit, uncertainty has led companies to freeze hiring. With monsoon rains in deficit, agricultural output and wider rural consumption also face a likely downturn.


Gauging household income key for microfinance clients

Source: This post is based on the article “Gauging household income key for microfinance clients” published in The Hindu on 2nd September 2021.

Syllabus: GS3 Mobilization of Resources, Growth, Development

Relevance: Credit growth, Micro-Finance

Synopsis: An accurate assessment of household-level incomes would avoid instances of over-indebtedness and ensure long-term stability of the ecosystem.

Introduction

Recently released, Consultative Document on Regulation of Microfinance in June 2021, shows that the microfinance movement in India is set to receive momentum.

Following the Malegam Committee Report, the current Consultative Document on Regulation of Microfinance looks to reassess the priorities of the microfinance sector.

What are some key recommendations?

First, some of the key regulatory changes proposed in the document takes household income as a critical variable for loan assessment.

Second, the definition of microfinance itself is proposed to mean collateral-free loans to households with annual household incomes of up to ₹1,25,000 and ₹2,00,000 for rural and urban areas respectively.

Third, it suggested all Regulated Entities to have a board-approved policy for household income assessment. It caps loan repayment for all outstanding loans of the household at 50% of household income.

Why measuring household income is complex?

First, with a high degree of informality in our economy, income tends to be unpredictable in time and volatile in volume.

Second, Low-Income Households (LIHs), who form the customer base for Microfinance Institutions (MFIs) have seasonal and volatile income flows. For instance, households with migrant workers who migrate to the city for certain months of the year see an income peak during those months.

Third, the highs are also contrasted by lows during certain lean seasons when remunerative work is unavailable, such as drought and during growing season. There have been attempts to understand their inflows by measuring their expenditure. But, due to rotational debts, expenditure also does not truly reflect the household’s income.

Fourth, for most LIHs, their expenditure on income-related activity is not separate from their personal expenses. It is difficult to separate the household’s personal expenses from their occupational pursuits.

How household income can be measured?

Structured survey-based approach: It could be used by Financial Service Providers (FSPs) to assess a household’s expenses, debt position and income from various sources of occupation. However, attention must be paid while designing such a questionnaire so that it captures seasonality and volatility in cash flows.

Template-based approach: It could be used wherein FSPs could create various templates for different categories of households (as per location, occupation type, family characteristics, etc.).

Household templates could be defined based on publicly available data sets that contain State/district-level information about household cash flows and occupation types. These templates could then be used to gauge the household income of a client matching a particular template.

Centralised database: FSPs could collect and maintain household income data through a centralised database. This would allow for uniformity in data collection across all FSPs.

Technology Service providers could play a crucial role in this exercise and create customised digital architecture for FSPs depending on their specific needs. Creating new technology to document and analyse cash flows of LIHs would facilitate innovation in the standard microcredit contracts through customised repayment schedule and risk-based pricing, depending on a household’s cash flows.


Our banks are mispricing capital and this is simply unsustainable

Source: This post is based on the article “Our banks are mispricing capital and this is simply unsustainable” published in Live Mint on 2nd September 2021. 

Syllabus: GS3-Issues related to Banking sector 

Relevance:  Monetary policy and Economic stability 

Synopsis: Below-cost lending in India could have economic repercussions beyond the financial burden imposed on bank shareholders.

Background

We have a situation in India today where the policy repo rate has been kept low, which is reflected in the cost of deposits and consequently lending rates.  

Also, there is talk of loan melas, where credit must be given. The question that arises is whether we are pricing capital adequately. 

What is the cost borne by the banks? 

For instance, for every ₹100 of deposits that enter the banking system, there are accompanying costs for the system. 

These are deposit costs, provisioning for NPAs, return on assets (ROA or minimum profit), and the regulatory cost of cash reserve and statutory liquidity ratio balances (CRR and SLR). 

Adding these components, the basic cost works out to 8.9%, which should be the rate at which incremental lending should take place.  

Hence, by offering loans at a much lower rate of 7.23%, the banking system is actually mispricing the capital. 

Other issues: As NPAs increase, ideally banks should load this cost onto their borrowers. But that rarely happens in India. Instead, it is taken on banks’ books and gets reflected in their balance sheets.  

How does mispricing capital impact the economy? 

Deposit costs have been driven down as savers don’t have a choice. Deposit-holders are subsidizing borrowers quite significantly. 

Loss to bank shareholders: Banks have been placing funds costing them 8.9% with the central bank through its reverse repo window, which gives them just 3.35%. This loss is eventually borne by bank shareholders. 

More lending to small businesses: With rigid policies on corporate lending to avert possible NPAs, banks have preferred lending to the retail segment, which is less risky, and small businesses, backed by the Centre’s credit guarantee. 

Prelims Oriented Articles (Factly)

Is Covid-19 now endemic in India?

Source: This post is based on the article Is Covid-19 now endemic in India?published in the Indian Express on 31st August 2021.

What is the News?

The World Health Organization(WHO) chief scientist has said that India seems to be entering some stage of Covid-19 endemicity, where there is low- to moderate-level transmission.

What is endemicity?

Endemic refers to the constant presence and/or usual prevalence of a disease or infectious agent in a population within a geographic area.

For Example, Malaria and Chickenpox are endemic diseases, unlike smallpox, which has been eradicated.

Note: Pandemic is an epidemic occurring worldwide or over a very wide area, crossing international boundaries and usually affecting a large number of people.

Why is Covid-19 entering into endemicity?

Disease pathogens that don’t have animals (another species) as a reservoir alone can be eradicated. For example, smallpox and polio are human viruses, so they can be eradicated. 

This means if there is a virus/pathogen that is present in some animal reservoir like bats, camels or civet cats, then it can transmit again once the level of immunity wanes in the population against the disease caused by it.

In the case of coronavirus disease, it will continue to circulate as it is present in the animal reservoir.

Future Projections:

Covid-19 will eventually stabilise to a level where it will be present among people but at a relatively low and predictable rate

It will cause disease to the extent that people have had no vaccination against or exposure.

However, if enough people are vaccinated or have been exposed to the infection, then the virus will cause symptomatic infection but not the disease.


Snow leopard, Black necked crane declared state animal and birds in Ladakh

Source: This post is based on the article “Snow leopard, Black-necked crane declared state animal and birds in Ladakh” published in Times of India on 2nd September 2021.

What is the News?

The Administration of Union Territory of Ladakh has declared ‘snow leopard‘ as its state animal and black-necked crane as its State Bird.

Note: Erstwhile Jammu and Kashmir state had the black-necked crane and Kashmir stag (Hangul) as its state bird and animal respectively.

About Snow Leopard:

Snow leopards are found in the mountainous regions of central and southern Asia.

Read more: Snow leopards

About Black Necked Crane:

Black Necked Crane is endemic to the Tibetan Plateau. The largest populations of the bird are in China, with smaller numbers extending into Vietnam, Bhutan, and India.

In India, eastern Ladakh is the only known breeding ground for Black-necked cranes outside China. The estimated population of Black-necked Crane in the Ladakh region is between 80-100 while the global population is estimated to be around 6,000.

Recently, for the first time, a Black-necked Crane has been fitted with satellite transmitters in the Ladakh region to know its migration routes.

Read more: Black Necked Crane


India, Kazakhstan joint military exercise ‘KAZIND-21’

Source: This post is based on the article “India, Kazakhstan joint military exercise KAZIND-21” published in PIB on 1st September 2021.

What is the News?

The fifth edition of the Exercise “KAZIND-21” has started at Training Node Aisha Bibi, Kazakhstan.

About KAZIND-21:

It is an annual bilateral military exercise between India and Kazakhstan. This is the fifth edition of the exercise. The exercise will focus on Counter Insurgency/ Counter-Terrorism operations in the mountainous terrains as well as rural and urban settings under the UN mandate.

This exercise will provide impetus to the ever-growing military and diplomatic ties between the two nations.

About India-Kazakhstan Relations:

Kazakhstan is a country in Central Asia. India was one of the first countries to recognize the independence of Kazakhstan. Diplomatic relations were established in February 1992.

India-Kazakhstan Inter-Governmental Commission (IGC) was established in 1993. It is the apex bilateral institutional mechanism for developing trade, economic, scientific, technological, industrial and cultural cooperation between the two countries. 

The two countries in 2009 signed a Strategic Partnership treaty. In 2015, the two countries signed a Defence and Military Technical cooperation agreement.

Indian Space Research Organization (ISRO) launched “Al-Farabi-1”, a 1.7 kg Technology Demonstrator Nano Satellite built by Al-Farabi Kazakh National University, Almaty along with 103 other satellites in 2017.


India to Offer Indemnity to Flag Carrier Bidder Over Cairn Claim

Source: This post is based on the article “India to Offer Indemnity to Flag Carrier Bidder Over Cairn Claim“ published in Livemint on 2nd September 2021.

What is the News?

The Indian Government has planned to offer indemnity to the financial bidders of Air India Ltd.

Note: Indemnity means security against a loss or other financial stress.

Must Read: What is “Indemnity” and why vaccine manufacturers are demanding that?

Why is India planning to provide indemnity to Air India bidders?

In 2020, Britain’s Cairn Energy Plc had won an arbitration award for $1.2 billion-plus interest over a controversial retrospective tax demand from the Indian government. Recently, Cairn has secured an order from a French court authorizing the freezing of 20 Indian government properties in Paris. This includes the assets of Air India also. Cairn Energy has also registered the arbitration award in several countries.

Read more: Cairn Energy dispute and Government disputes with private entities – Explained, pointwise

Similarly, Devas Multimedia has won a case against Antrix Corporation (a subsidiary of the Indian Space Research Organisation) for arbitrary cancellation of a contract. Devas Multimedia Pvt is also seeking to seize Air India’s assets abroad.

Due to this, the potential bidders of Air India are afraid of encountering any surprises on further liabilities. Hence, to give them assurance from any liability, the Government has planned to offer indemnity to the financial bidders of Air India Ltd.

Note: India has recently passed the Taxation Laws (Amendment) Bill, 2021, in Parliament. The bill allows firms relief from the retrospective tax demands if they agree to drop litigation. The government is also in talks with Cairn to settle the dispute.

Read moreRetrospective taxation and the Taxation Laws (Amendment) Bill – Explained, pointwise

Effectiveness of vaccines

Source: This post is based on the article “Effectiveness of vaccines” published in The Hindu on 2nd September 2021.

What is the News?

According to a study, natural infection confers stronger immunity against the SARS-CoV-2 virus than even full vaccination. 

Background

Natural Immunity following a virus infection lasts longer is already well known. For Example, People infected with the 2002 Severe Acute Respiratory Syndrome (SARS) and the Middle East Respiratory Syndrome(MERS) have been shown to have strong immunity for up to three years.

However, a study has now shown that natural infection confers stronger immunity against the SARS-CoV-2 virus also than even full vaccination.

About the Study

The study was undertaken in Israel, as it was the first country to vaccinate a large percentage of the population with the Pfizer vaccine.

The researchers compared over 16,000 people who were previously infected but not vaccinated with an equal number of people who had not been naturally infected but fully vaccinated.

What were the findings?

The researchers have found that people previously infected with the Covid-19 virus had better immunity, reduced risk of reinfection, than uninfected people who were fully immunised with the Pfizer vaccine.

What are the flaws in the study?

The study has not informed if the level and duration of immunity protection varies depending on the severity of the disease and whether asymptomatic infection confers the same protection as those with the disease.

What are the other findings of the study?

One encouraging finding of the study is the absence of death among the vaccinated. This is a clear signal that the vaccine offers formidable protection against serious infections. 

Hence, natural immunity, even if found to be superior and long-lasting than vaccine-induced protection, is not what one should opt for.

Vaccination will always remain a safe and sure way to remain protected against severe COVID-19 disease and death, even if it means the protection is not robust or long-lasting.


Naval Aviation to get President’s Colour

Source: This post is based on the article “Naval Aviation to get President’s Colour” published in PIB on 1st September 2021.

What is the News?

The President of India will award the President’s Colour to Indian Naval Aviation at the ceremonial parade to be held at INS Hansa, Goa.

What is President’s Colour?

President’s Colour is the highest honour bestowed on a military unit in recognition of its exceptional service to the nation. 

The Indian Navy was the first amongst the Indian Armed Forces to be awarded the President’s Colour in 1951.

Subsequent recipients of the President’s Colour in the Navy include Southern Naval Command, Eastern Naval Command, Western Naval Command, Eastern Fleet, Western Fleet, Submarine Arm, INS Shivaji and the Indian Naval Academy.

About Naval Aviation

Indian Naval Aviation came into existence in 1951, with the acquisition of the first Sealand aircraft, and commissioning of INS Garuda, the first Naval Air Station in 1953.

Currently, Indian Naval Aviation has nine air stations and three naval air enclaves along the Indian coastline and in Andaman and Nicobar Islands.


Women and Child Development Minister inaugurates NUTRI GARDEN at All India Institute of Ayurveda

Source: This post is based on the article “Women and Child Development Minister inaugurates NUTRI GARDEN at All India Institute of Ayurveda published in PIB on 1st September 2021.

What is the News?

The Union Minister for Women and Child Development has inaugurated NUTRI GARDEN to mark the beginning of Poshan Maah – 2021 at the All India Institute of Ayurveda (AIIA). 

Read more: Poshan Maah
About Nutri Gardens

Nutri kitchen garden/Nutri garden is a method of planting and harvesting nutrient-rich crops in residential houses or in their vicinity to meet the requirements of the family all year round. 

In urban areas, Nutri kitchen gardening can be promoted in the form of rooftop gardening, terrace gardening, vertical gardening and container gardening. 

In rural areas, Nutri kitchen gardens can be promoted in the backyard of the houses. 

What are the benefits of Nutri Garden?

It increases the availability of food and nutrient sources. It can act as a source of supplementary income. The crops harvested are Fresh and Safe (chemical-free).


IIT Ropar’s startup company introduces World’s first ‘Plant based’ smart air-purifier “Ubreathe Life”

Source: This post is based on the article “IIT Ropar’s startup company introduces World’s first ‘Plant based’ smart air-purifier “Ubreathe Life”published in PIB on 1st September 2021.

What is the News?

IIT Ropar’s startup company has developed a living plant-based air purifier, “Ubreathe Life” that amplifies the air purification process in indoor spaces.

About Ubreathe Life

Ubreathe Life
Source: Times of India

Ubreathe Life is the world’s first, state-of-the-art ‘Smart Bio-Filter’ that can purify the air.

It amplifies the air purification process in indoor spaces. These indoor spaces can either be hospitals, schools, offices and your homes.

 

Who developed Ubreathe Life?

It has been developed at IIT Ropar, which is a designated iHub – AWaDH (Agriculture and Water Technology Development Hub) of the Department of Science and Technology.

How does Ubreathe Life work?

The technology works through the air-purifying natural leafy plant. The room air interacts with leaves and goes to the soil-root zone where maximum pollutants are purified. 

The technology used in this product is the ‘Urban Munnar Effect’ along with patent-pending “Breathing Roots” to exponentially amplify the phytoremediation process of the plants. 

Note: Phytoremediation is a process by which plants effectively remove pollutants from the air.

What is the significance of the device?

‘Ubreathe Life’ effectively improves indoor air quality by removing particulate, gaseous, and biological contaminants while increasing the oxygen levels in the indoor spaces.

This is done through specific plants, UV disinfection, and a stack of Pre-filter, Charcoal filter, and HEPA (high-efficiency particulate air) filter fitted in a specially designed wooden box.


Indian Army to participate in multinational military exercise ‘ZAPAD 2021’ in Russia

Source: This post is based on the article “India to participate in exercise ‘ZAPAD 2021’ in Russia” published in PIB on 1st September 2021.

What is the News?

Indian Army contingent will participate in a multi-nation military exercise named ‘ZAPAD 2021‘ at Nizhny in Russia.

About Exercise ZAPAD:

Exercise ZAPAD 2021 is one of the theatre level exercises of the Russian Armed Forces. The exercise focuses primarily on operations against terrorists with the aim to enhance military and strategic ties amongst the participating nations.

More than a dozen countries from the Eurasian and South Asian Regions will participate in the exercise. From India, the NAGA Battalion group is participating in the exercise.

About Naga Regiment

Naga Regiment is one of the fiercest infantry regiments of the Indian Army. It is amongst the youngest regiments of the Indian Army – the first battalion raised in Ranikhet 1970. The regiment recruits mainly from Nagaland, in northeast India.


UN: Weather disasters soar in numbers, cost, but deaths fall

Source: This post is based on the article “UN: Weather disasters soar in numbers, cost, but deaths fall” published in The Indian Express on 1st Sep 2021.

What is the news?

As per World Meteorological Organization (WMO)’s report, weather disasters are striking the world four to five times more often and causing seven times more damage than in the 1970s.

About the report

The report looks at more than 11,000 weather disasters in the past half-century.

The report comes during a disaster-filled summer globally, including deadly floods in Germany and a heat wave in the Mediterranean, and with the United States simultaneously struck by powerful Hurricane Ida and an onslaught of drought-worsened wildfires.

What are the findings of the report?

Increasing frequency of disasters: In the 1970s, the world averaged about 711 weather disasters a year, but from 2000 to 2009 that was up to 3,536 a year or nearly 10 a day. What’s driving the destruction is that more people are moving into dangerous areas as climate change is making weather disasters stronger and more frequent.

Increasing economic losses: In the 1970s, weather disasters cost about $175 billion globally, when adjusted to 2019 dollars, the U.N. found. That increased to $1.38 trillion for the period from 2010 to 2019. The economic losses have been growing very rapidly and this growth will continue.

Disasters are, however, killing far fewer people now. In the 1970s and 1980s, they killed an average of about 170 people a day worldwide. In the 2010s, that dropped to about 40 per day. As per experts, better weather warnings and preparedness are lessening the death toll.

More climatic extremes in the future: We are going to see more climatic extremes because of climate change, and these negative trends in climate will continue for the coming decades.

Most death and damage during 50 years of weather disasters came from storms, flooding and drought.

Developing nations suffer more: More than 90% of the more than 2 million deaths are in what the U.N. considers developing nations, while nearly 60% of the economic damage occurred in richer countries.


Missing the woods: 18% of India’s 2,603 tree species threatened with extinction

Source: This post is based on articleMissing the woods: 18% of India’s 2,603 tree species threatened with extinction published in Down to Earth on 2nd September 2021.

What is the news?

According to the State of the World’s Trees report, released by London-based Botanic Gardens Conservation International, some 469 of India’s 2,603 tree species (18%) are threatened with extinction.

Findings

Firstly, about a third of the tree species found in the Indo-Malaya (Tropical Asia) biogeographic realm of which India is a part, have not been evaluated and data about them is deficient.

Secondly, other than Indo-Malaya and Oceania, the Afrotropics (Africa south of the Sahara, including Madagascar) have the highest proportion of threatened tree species.

Thirdly, the Palearctic and Nearctic (North America) realms mostly have tree species that are not threatened.

Fourthly, the Neotropics (Central and South America) have the largest number of tree species with 23,631 tree species. Indo-Malaya is second and the Afrotropics have 9,237 species. The Nearctic and Oceania have the lowest number of tree species.

Fifthly, the researchers found that 142 of the world’s tree species have become extinct.

Sixthly, among countries, Brazil, China, Colombia and Indonesia had many tree species as well as many threatened species. Madagascar is one of the countries with the highest number of threatened trees.

What are the threats to the trees?

Threats to tree species, as listed in the report, includes:

Agriculture (29%), logging (27%), livestock farming (14%), residential and commercial development (13%), fire and fire suppression (13%), energy production and mining (9%), wood and pulp plantations (6%), invasive and other problematic species (5%) and climate change (4%).


 

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