The policy is based on the Principles of trust and partnership with exporters and aims at process re-engineering and automation to facilitate ease of doing business for exporters.

The Key Approach to  the policy is based on these 4 pillars:

1. Incentive to Remission
2. Export promotion through collaboration-Exporters, States, Districts and Indian Missions
3. Ease of doing business, reduction in transaction cost and e-initiatives and 
4. Emerging Areas-E-Commerce Developing Districts as Export Hubs and Streamlining SCOMET Policy.

4. Goals and Targets

• The Government aims to increase India's overall exports to USD 2 trillion by 2030, with equal contributions from the merchandise and services sectors.
• It also intends to encourage the use of Indian Currency in cross-border trade, aided by a new payment settlement framework introduced by the RBI in July 2022.
• This could be particularly advantageous in the case of countries with which India enjoys a trade surplus.

5. Salient features 

• Targets $ 2 trillion in exports by 2030
• Continuous and responsive framework with no end date
• Making the rupee a global currency
• Making India a trade hub
• Digitisation and faster processing of applications
• Amnesty scheme for the shortfall in export obligations
• Restructuring of the Department of Commerce
• Over 50 per cent reduction threshold for recognition of star trade houses

6. Process Re-Engineering and Automation

• The policy emphasizes export promotion and development, moving away from an incentive regime to a regime which is facilitating, based on technology interface and principles of collaboration.
• FTP 2023 codifies implementation mechanisms in a paperless, online environment, building on earlier ease-of-doing-business initiatives.
• Reduction in fee structures and IT-based schemes will make accessing export benefits easier for MSMEs and others.
• Duty exemption schemes for export production will now be implemented through Regional Offices in a rule-based IT system environment, eliminating the need for a manual interface.

7. Towns of Export Excellence

• Four new towns, namely Faridabad, Mirzapur, Moradabad and Varanasi have been designated as Towns of Export Excellence (TEE) in addition to the existing 39 towns.
• The TEEs will have priority access to export promotion funds under the MAI scheme and will be able to avail of Common Service Provider (CSP) benefits for export fulfilment under the EPCG Scheme. It is expected to boost the exports of handlooms, handicrafts and Carpets.

8. Recognition of Exporters

• Exporter firms recognized with "status" based on export performance will now be partners in capacity-building initiatives on a best-endeavour basis.
• Similar to the "each one teaches one" initiative, 2-star and above status holders would be encouraged to provide trade-related training based on a model curriculum to interested individuals.
• Status recognition norms have been re-calibrated to enable more exporting firms to achieve 4 and 5-star ratings, leading to better branding opportunities in export markets.

9. Promoting export from the districts

• The FTP aims at building partnerships with State governments and taking forward the Districts as Export Hubs (DEH) initiative to promote exports at the district level and accelerate the development of the grassroots trade ecosystem.
• Efforts to identify export-worthy products & services and resolve concerns at the district level will be made through an institutional mechanism State Export Promotion Committee and District Export Promotion Committee at the State and District level, respectively.
• District-specific export action plans to be prepared for each district outlining the district-specific strategy to promote the export of identified products and services.

10. Streamlining SCOMET Policy

• India is placing more emphasis on the "export control" regime as its integration with export control regime countries strengthens.
• There is a wider outreach and understanding of SCOMET (Special Chemicals, Organisms, Materials, Equipment and Technologies) among stakeholders and the policy regime is being made more robust to implement international treaties and agreements entered into by India.
• A robust export control system in India would provide access to dual-use High-end goods and technologies to Indian exporters while facilitating exports of controlled items/technologies under SCOMET for India.

11. Facilitating E-Commerce Exports

• Various estimates suggest e-commerce export potential in the range of $200 to $300 billion by 2030.
• FTP 2023 outlines the intent and roadmap for establishing e-commerce hubs and related elements such as payment reconciliation, bookkeeping, returns policy and export entitlements.
• As a starting point, the consignment-wise cap on E-Commerce exports through courier has been raised from ₹ 5 Lakh to ₹ 10 Lakh in the FTP 2023.
• Depending on the feedback of exporters, this cap will be further revised or eventually removed.

12. Facilitation under the Export Promotion of Capital Goods (EPCG) Scheme

The EPCG Scheme allows the import of capital goods at zero Customs duty for export production, which is being further rationalised. Some key changes being added are:

• Prime Minster Mega Integrated Textile Region and Apparel Parks (PM MITRA) scheme has been added as an additional scheme eligible to claim benefits under the CSP (Common Service Provider) Scheme of Export Promotion Capital Goods Scheme (EPCG),
• Dairy Sector to be exempted from maintaining Average Export Obligations to support the dairy sector to upgrade the technology.
• Battery Electric Vehicles (BEV) of all types, Vertical Farming equipment, Wastewater Treatment and Recycling, Rainwater harvesting system and Rainwater Filters and Green Hydrogen are added to Green Technology products and will now be eligible for reduced Export Obligation requirements under EPCG Scheme.

13. Facilitation under the Advance Authorization Scheme

• The advance authorisation Scheme accessed by DTA units provides duty-free import of raw materials for manufacturing export items and is placed at a similar footing to EOU and SEZ schemes.
• Special Advance Authorisation Scheme extended to the export of the Apparel and clothing sector under a self-declaration basis to facilitate prompt execution of export orders.
• Benefits of Self-Ratification Scheme for fixation of Input-Output Norms extended to 2 stars and above status holders in addition to Authorised Economic Operators at present.

15. Amnesty Scheme

• Under the amnesty Scheme, an online portal will be launched for registration and a six-month window will be available to exporters to avail of the scheme.
• It will cover all pending cases of default in the export obligation of authorisations, these can be regularised on payment of all customs duties exempted in proportion to unfulfilled export obligations.

For Prelims & Mains

Previous Year Questions

UN WORLD WATER CONFERENCE

 

1. Context

The World Water Conference was convened by the United Nations (March 22­, 2023) and was the first UN conference on freshwater in almost 50 years.

2. Background

• It was held in the context of serious environmental issues flooding, drought, the severity of climate change, and a looming food crisis.
• The conference also marked a mid­term review of the Water Action Decade 2018­-2028 (to advance the water agenda by energizing existing programs and projects, and inspiring water action to achieve the 2030 Agenda, in particular Sustainable Development Goal 6 (SDG 6), which envisages the sustainable management of water and sanitation for all.
• The central outcome of the conference was the international Water Action Agenda, to which governments, multilateral institutions, businesses, and non­governmental organizations submitted over 670 commitments to address water security issues.
• Nearly 164 governments and 75 multilateral organizations have made commitments.
• While the commitments embodied in the Water Action Agenda are voluntary and, therefore, legally non­binding, the voluntary commitments are expected to inspire the collective political will, which is needed to address the many water challenges.

3. What is UN Water Conference?

• The UN Water Conference is an international conference that aims to better align activities by governments, companies, NGOs, and funders around a few grand challenges in the water sector.
• It serves as a platform for countries to learn from the experiences of others, transfer technology, and invest.
• The last UN Water Conference was held in 1977.
• It resulted in the first global ‘Action Plan’ recognizing that all people have the right to access safe drinking water and sanitation.
• This led to several decades of global funding and concerted effort to provide drinking water and sanitation for all.

4. Poor finances, poor water services

• The commitments made at the conference must be scrutinized to see whether they will yield universal, safe, affordable, and equitable access to water that is consistent with SDG 6.
• Meeting this target by 2030 (as envisioned by the SDG) will incur capital expenditures of $114 billion per year.
• The World Bank estimates recurring operations and maintenance for basic water and sanitation service (WASH) costs to rise from about $4 billion to over $30 billion per year by 2030, which is far more than the capital costs for basic WASH services.
• The World Resources Institute (WRI) is of the view that the commitments made by the states reflected rigour, scope, and ambition but they lacked proper finance and targets that are quantifiable in nature.
• Investment in this range would require valuing water, which in turn requires robust water measurement and accounting.
• There are ‘serious limitations in our knowledge about the volume, flux, and quality of water in lakes, rivers, soils, and aquifers.
• There are huge gaps in water usage data. The metering of water has triggered resistance from India to Ireland because of concerns about equitable access and affordability of water services.

5. Funding

• Funding from regional, national, and international sources prioritizes new water infrastructure rather than water maintenance services (World Bank study).
• It results in decreased service for water customers. World Bank estimates project recurring operations and maintenance service (WASH) costs to rise from about $4 billion to over $30 billion per year by 2030, which is far more than the capital costs for basic WASH services. Water does not qualify to be a global public good as it is not considered to be an area of urgent funding as compared to climate change.
• The Global Environment Facility (GEF) is the only international funding mechanism that has been able to cover more than 300 watersheds and an even greater number of aquifers across the political boundaries of two or more states with its grant and concessional loan.

6. India's Commitments at the Conference

India’s commitments at the conference were:

• An investment of $240 billion in the water sector and efforts to restore groundwater level.
• A 2021 CAG report says that groundwater extraction in India increased from 58% to 63% between 2004-­17.
• This has been further exacerbated by climate change resulting in intermittent rainfall, which further undermines the recharge potential.
• The revised Groundwater Bill 2017 vests State groundwater boards with creating laws, managing water allocation, and other relevant issues.
• The State boards are understaffed, lack expertise and prioritize socio­political conflicts over groundwater resources.
• In international law, ‘states possess the authority to make voluntary commitments to address issues of global concern.
• These commitments are distinguished from other legal forms because they are not made pursuant to a consensus instrument to which the parties have agreed.
• They are generally independent of the commitments of other parties. 
• Efforts to ‘tackle climate change and promote environmental sustainability have led states to make voluntary commitments to curb greenhouse gases and to take measures to promote sustainability, even in the absence of a legally non­binding instrument.
• The commitments of states after the Climate Conference in Denmark (December 2009), underline this.
• But in the case of climate change, these voluntary commitments take place within the broader context of binding agreements: the United Nations Framework Convention on Climate Change, the Kyoto Protocol, and the Paris Agreement.
• Voluntary commitments are becoming an important feature in the environmental law vista, but they raise difficult issues of accountability.
• Commitments made by the states with different formats and with different content pose challenges in terms of monitoring compliance with each commitment.
• Voluntary commitments are perhaps just a necessary step in the face of inaction.

7. Outcomes of the 2023 Conference

• The conference’s proceedings resulted in a lot of talks, fragmented discussions, and no binding commitments.
• There were 713 diverse voluntary commitments by philanthropic donors, governments, corporations, and NGOs, with 120 relevant to India.
• Commitments included a $50-billion commitment from the Indian government to improve rural drinking water services under its Jal Jeevan Mission.

For Prelims & Mains

For Prelims: UN World Water Conference, Sustainable Development Goal 6 (SDG 6), World Resources Institute (WRI), Global Environment Facility (GEF), World Bank, and Jal Jeevan Mission. For Mains:1. What is UN Water Conference? Explain India's commitments at the Conference and discuss the key outcomes of the conference.

Previous year Question

1. With reference to the water on the planet Earth, consider the following statements: (UPSC 2021) 1. The amount of water in the rivers and lakes is more than the amount of groundwater. 2. The amount of water in polar ice caps and glaciers is more than the amount of groundwater. Which of the statements given above is/are correct? A. 1 only B. 2 only C. Both 1 and 2 D. Neither 1 nor 2 Answer: B

 Source: The Hindu

WHY AL AQSA MOSQUE IS IMPORTANT TO ISLAM

 

 

1.Context

A Israeli police raid on Jerusalem’s Al-Aqsa mosque  has triggered a furious reaction from Palestinians across the occupied West Bank and the wider Arab and Muslim world

2. What is Al Aqsa Mosque

• The Al-Aqsa lies at the heart of Jerusalem’s Old City on a hill known to Jews as Har ha-Bayit, or Temple Mount, and to Muslims internationally as al-Haram al-Sharif, or The Noble Sanctuary
• Muslims regard the site as the third holiest in Islam, after Mecca and Medina
• Al-Aqsa is the name given to the whole compound and is home to two Muslim holy places: the Dome of the Rock and the Al-Aqsa Mosque, also known as the Qibli Mosque, which was built in the 8th century AD
• The compound overlooks the Western Wall, a sacred place of prayer for Jews, for whom the Temple Mount is their most sacred site
• Jews believe biblical King Solomon built the first temple there 3,000 years ago. A second temple was razed by the Romans in AD 70
• Israel captured the site in the 1967 Middle East war and annexed it with the rest of East Jerusalem and adjoining parts of the West Bank in a move not recognized internationally
• Jordan, whose ruling Hashemite family has custodianship of the Muslim and Christian sites, appoints members of the Waqf institution which oversees the site

3. Al aqsa in the flashpoint of Israel-Palestinian Conflict

• The Al-Aqsa compound has long been a flashpoint for deadly violence over matters of sovereignty and religion in Jerusalem
• Under the longstanding “status quo” arrangement governing the area, which Israel says it maintains, non-Muslims can visit but only Muslims are allowed to worship in the mosque compound
• Jewish visitors have increasingly prayed more or less openly at the site in defiance of the rules, and Israeli restrictions on Muslim worshippers’ access to the site have led to protests and outbreaks of violence
• Clashes at the site in 2021 contributed to setting off a 10-day war with Gaza
• In 2000, the Israeli politician Ariel Sharon, then opposition leader, led a group of Israeli lawmakers onto the Temple Mount/al-Haram al-Sharif complex
• Palestinians protested, and there were violent clashes that quickly escalated into the second Palestinian uprising, also known as the Al-Aqsa Intifada

 

 

Source: indianexpress

PREPAID PAYMENT INSTRUMENTS

1. Context 

For the past few years, many payment modes have been introduced and approved by RBI, which has facilitated the purchase of goods and services. One such technological development is the Prepaid Payment Instruments (PPIs).

One of the biggest features of this form of instrument is that value is already stored in these instruments including paper vouchers, prepaid smart cards, online wallets etc.

2. Prepaid payment instrument

• Prepaid Payment Instruments or commonly known as PPIs are instruments that facilitate the purchase of goods and services, enable remittance facilities, the conduct of financial services etc., against the value that is stored in them.
• These PPIs are generally issued by banks or non-banks where banks need to take approval and non-banks need authorisation before issuing such PPIs.
• PPIs come in various forms such as mobile wallets, smart cards, vouchers, magnetic chips, payment wallets etc.

3. Types of PPIs in India

Under the earlier Master Direction on Issuance and Operation of Prepaid Payment Instruments of 2017, the Reserve Bank of India (RBI) had classified prepaid payment instruments into three types viz.

3.1. Closed System PPIs

These PPIs were issued by an entity to facilitate the purchase of goods and services from the same entity only. There was no provision for cash withdrawal from the same

3.2. Semi-Closed PPIs

Such PPIs were issued by the RBI approved Banks and also RBI approved Non-Banks for the purchase of goods and services, remittance facilities, financial services etc, for use at a group of identified merchant locations which have a special contract with the issuer or through a payment aggregator/payment gateway to accept PPIs as payment instruments.

3.3. Open System PPIs

• These PPIs were issued by RBI-approved banks to be used by any merchant for the purchase of goods and services, remittance facilities, financial services etc.
• The above system of PPIs was found to be hampering interoperability and harmonisation amongst various PPIs.
• As a result, RBI came out with a new set of Master Directions on Prepaid Payment Instruments of 2021, laying down fresh eligibility criteria and conditions of use for payment system operators that are involved in the issuance and operation of Prepaid Payment Instruments.

4. Latest Categorisation of Prepaid Payment Instruments

4.1. Small PPIs

• These are issued by both banks and non-banks after obtaining minimum information about the PPI holder.
• These PPIs can only be used for the purchase of goods and services and that too at a group of identified merchant establishments/locations having a special contract with the issuer to accept the PPIs as Payment instruments.
• The facility of funds transfer or cash withdrawal from such PPIs has not been permitted. 
• Under the category of Small PPIs, there are two types of Prepaid payment instruments. They are:

4.2. Small PPIs with cash loading facility

The total cash in these PPIs cannot exceed Rupees 10, 000 a month and the total amount during the year cannot exceed the amount of Rupees 1, 20, 000 in financial year. They have the facility to load cash.

4.3. Small PPIs with no cash-loading facility

This type of PPI has the same limit as mentioned above, but the cash loading facility is absent in these PPIs.

4.4. Full KYC PPIs

These PPIs are issued by Banks and non-banks after completing the Know Your Customer (KYC) process of the PPI holder.

These PPIs, however, can be used to purchase goods and services, cash withdrawals and fund transfers.

5. Specific categories of PPIs

5.1. Gift PPIs

• In these PPIs, the Maximum value of a prepaid gift instrument cannot exceed a sum of Rupees 10, 000.
• These PPIs are not reloadable and the facility of fund transfer and cash withdrawal is also not permitted.
• The PPI issuer is supposed to maintain the KYC details of the purchaser of such instrument and separate KYC will not be required for the customer who is issued such instruments through Debit Cards to their bank accounts and Credit Cards in India.
• A risk-based approach, which is duly approved by its Board, will be adopted by the PPI issuer to decide the number of such instruments which can be issued to a customer, transaction limits etc.
• At the request of the PPI holder, these PPIs will be revalidated, including through the issuance of a new instrument.
• Before the first loading of funds takes place or at the time of issuance of the PPI, the features of such PPIs have to be communicated to the PPI holder via SMS/email/any other means.

5.2. PPIs for Mass Transit Systems (PPI-MTS)

• The MTS operators issue these PPIs after the authorisation to issue such PPIs under the Payment and Settlement Systems Act, 2007.
• These PPIs are reloadable and they are used at only merchant outlets whose operations are within premises.
• The PPI issuer decides about the customer details required for the issuance of such PPIs.
• In these kinds of PPIs, the maximum outstanding value shall not exceed the limit of Rupees 3000 at any point in time
• Further, cash withdrawals and funds transfers are prohibited for such instruments.

6. Conclusion

• From the above discussion, it can be concluded that there are primarily two types of Prepaid Payment Instruments.
• However, RBI has created special categories where two more types of Prepaid Payment Instruments have been added viz. Gift PPIs and PPIs for Mass Transit Systems.
• To protect the holders and acceptors of PPIs from potential fraud and exploitation, RBI has made it necessary for the PPI issuer to state all the T&Cs for the usage of PPIs in clear and simple language.

For Prelims & Mains

For Prelims: RBI, Prepaid Payment Instruments, Mass Transit Systems, KYC For Mains:  1. What are Prepaid Payment Instruments? Discuss the various types of Prepaid Payment Instruments in India. (250 Words)

Previous Year Questions

1. The establishment of 'Payment Banks' is being allowed in India to promote financial inclusion. Which of the following statements is/are correct in this context? (UPSC  2016) 1. Mobile telephone companies and supermarket chains that are owned and controlled by residents are eligible to be promoters of Payment Banks. 2. Payment Banks can issue both credit cards and debit cards. 3. Payment Banks cannot undertake lending activities. Select the correct answer using the code given below. A. 1 and 2 only     B. 1 and 3 only    C. 2 only    D.  1, 2 and 3 Answer: B 2. Which of the following are the most likely consequences of implementing the ‘Unified Payments Interface (UPI)’? (UPSC 2017) (a) Mobile wallets will not be necessary for online payments. (b) Digital currency will totally replace physical currency in about two decades. (c) FDI inflows will drastically increase. (d) Direct transfer of subsidies to poor people will become very effective. Answer: (a)

Source: enterslice

INDIAN HISTORY BOOKS

 

1. Context

During a recent interview while promoting his movie ‘Samrat Prithviraj’, actor Akshay Kumar said the history of rulers like Prithviraj Chauhan “should be written about” in Indian history textbooks. He also appealed to the Union Education Minister to look into the matter.

2. Who decides the content of Indian history textbooks?

• Education as a subject comes under both the state and central governments according to the constitution, meaning both the state and

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