EARTH OBSERVATION SATELLITES (EOS)
1. Context
ISRO’s latest Earth Observation Satellite ‘EOS-08’ launched by the Small Satellite Launch Vehicle (SSLV)-D3 today at 9:17 hrs from Satish Dhawan Space Centre, Shriharikota.The primary objectives of the EOS-08 mission include designing and developing a microsatellite, creating payload instruments compatible with the microsatellite bus, and incorporating new technologies required for future operational satellites.
2.What is Earth observation satellites?
- Earth observation satellites, also known as Earth remote sensing satellites, are designed to monitor and collect data about the Earth from orbit. This category includes both military spy satellites and those intended for non-military purposes, such as environmental monitoring, weather forecasting, cartography, and more.
- These satellites are crucial for overseeing and safeguarding our environment, managing resources, responding to global humanitarian crises, and supporting sustainable development. They offer valuable insights into various aspects like ocean salinity, ice thickness, crop health, and air quality.
- The most common type of Earth observation satellites are Earth-imaging satellites, which capture images similar to aerial photographs. However, some EO satellites conduct remote sensing without creating images, such as those using GNSS radio occultation techniques
3.Types of Earth Observation Satellites
Earth observation satellites are crucial tools for monitoring our planet. They provide valuable data for various applications, including weather forecasting, environmental monitoring, and disaster management
Earth observation (EO) satellites can be categorized into two main types depending on their imaging techniques: passive and active.
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Passive Satellites: These satellites detect radiation that is reflected off the Earth's surface, including visible light and infrared. They generally cannot operate effectively through cloud cover.
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Active Satellites: These satellites emit energy towards the Earth's surface and measure the reflected signal to gather information. They are capable of penetrating cloud cover to obtain data
4. How do earth observation satellites collect data?
- Earth observation satellites operate in various orbits, providing different viewpoints of the Earth. Due to constraints in power and storage, most satellites do not continuously collect data.
- Some satellites provide consistent and reliable data, while others gather it intermittently over time.
- The collected data is stored on the satellite until it can be transmitted to a ground station when it comes into view.
- The duration from image capture to data availability can range from a month to just a few minutes, with advancements in technology reducing this time.
- As multiple companies own these satellites, there are various data providers with distinct pricing models.
- ISRO has deployed numerous operational remote sensing satellites. Currently, thirteen of these satellites are in sun-synchronous orbits, while four are in geostationary orbits.
- The data collected from these satellites supports a range of applications including agriculture, water resources, urban planning, rural development, mineral exploration, environmental monitoring, forestry, ocean resource management, and disaster response
5. Advantages of low Earth satellites
Earth observation satellites offer numerous advantages across various fields due to their ability to collect and transmit data from space.
Here are some of the key benefits:
- Climate Change: Track changes in climate patterns, ice melt, sea level rise, and greenhouse gas concentrations.
- Natural Disasters: Monitor and assess the impact of natural disasters like hurricanes, earthquakes, and floods in real-time.
- Agriculture: Provide data on crop health, soil conditions, and irrigation needs, helping optimize agricultural practices and increase yields.
- Water Resources: Monitor water bodies, track changes in water availability, and manage water resources more effectively.
- Land Use: Assist in urban planning and land use management by providing detailed imagery and data on land development and changes.
- Infrastructure: Support infrastructure development by providing accurate and up-to-date information on land and environmental conditions
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For Prelims: LOS, PSLV, GSLV
For Mains: GS III - Science & technology
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Previous Year Questions
1. With reference to India's satellite launch vehicles, consider the following statements: (UPSC 2018)
1. PSLVs launch satellites useful for Earth resources monitoring whereas GSLVs are designed mainly to launch communication satellites.
2. Satellites launched by PSLV appear to remain permanently fixed in the same position in the sky, as viewed from a particular location on Earth.
3. GSLV Mk III is a four- staged launch vehicle with the first and third stages using solid rocket motors; and the second and fourth stages using liquid rocket engines.
Which of the statements given above is/are correct?
A. 1 only
B. 2 and 3
C. 1 and 2
D. 3 only
Answer: A
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Source: PIB, Business Standard
SMALL SATELLITE LAUNCHING VEHICLES (SSLV)
1. Context
The Indian Space Research Organisation (ISRO) will launch the third development flight — the last one it is authorised to undertake — of the small satellite launch vehicle (SSLV)
2. What is a small satellite launch vehicle (SSLV)?
A Small Satellite Launch Vehicle (SSLV) is a type of rocket specifically designed to carry small satellites, typically weighing up to 500 kilograms, into space. SSLVs are engineered for cost-effective, flexible, and rapid deployment of these smaller payloads into low Earth orbit (LEO). These launch vehicles are increasingly important due to the growing demand for launching small satellites for purposes like Earth observation, communication, scientific research, and technology demonstrations
Key Features of SSLV:
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Size and Capacity: SSLVs are smaller and lighter than traditional rockets, making them suitable for launching payloads of small to medium-sized satellites.
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Cost-Effective: The development and launch costs of SSLVs are significantly lower than those of larger launch vehicles. This makes them an attractive option for both commercial and government missions that require deploying small satellites.
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Rapid Deployment: SSLVs are designed to be quickly assembled and launched, reducing the turnaround time between launches. This rapid deployment capability is especially valuable for time-sensitive missions.
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Flexibility: SSLVs offer greater flexibility in terms of launch schedules and orbital insertions, as they can be launched on demand and tailored to specific mission requirements.
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Multiple Payloads: Some SSLVs are capable of deploying multiple small satellites in a single mission, optimizing the use of resources and further reducing costs
| The Indian Space Research Organisation (ISRO) developed its own SSLV to meet the growing demand for small satellite launches. The SSLV is capable of carrying payloads of up to 500 kg to low Earth orbit and is designed for quick turnaround and cost-effective launches |
3. What are the advantages of using SSLV?
Using a Small Satellite Launch Vehicle (SSLV) offers several advantages, particularly in the context of the growing demand for launching small satellites.
Here are the key benefits:
- SSLVs are cheaper to develop and launch compared to larger rockets. This makes space access more affordable for smaller companies, startups, and research institutions
- SSLVs can carry multiple small satellites on a single mission, allowing the costs to be shared among different payload providers
- SSLVs are designed for rapid assembly and deployment, reducing the time between launches. This is particularly useful for time-sensitive missions
- SSLVs offer greater flexibility in scheduling launches, allowing operators to choose specific windows for launching their satellites based on mission requirements
- SSLVs can be dedicated to launching a single small satellite or a specific constellation of small satellites, ensuring that the payload is placed in the exact orbit required without waiting for a larger payload
- Small satellite operators no longer need to wait for a rideshare opportunity on a larger rocket, which can lead to delays and suboptimal orbits
- The lower cost and flexibility of SSLVs make space more accessible to universities, research institutions, startups, and smaller countries that might not have the resources to fund larger missions
- The availability of SSLVs encourages innovation and investment in space technologies, contributing to the growth of the space industry
- SSLVs can deploy multiple small satellites in different orbits during the same mission, enhancing the versatility of each launch
- SSLVs can be used for a wide range of missions, including Earth observation, communication, scientific research, and technology demonstration
4.What are PSLVs and GSLVs?
- The Polar Satellite Launch Vehicle (PSLV), introduced in 1994, represents the third generation of Indian satellite launch vehicles.
- To date, it has achieved over 50 successful launches. Often referred to as "ISRO's workhorse," the PSLV has reliably placed various satellites into low Earth orbits (below 2,000 km altitude) with a strong track record of success.
- The PSLV-XL variant can carry payloads of up to 1,860 kg. Meanwhile, Geosynchronous Satellite Launch Vehicles (GSLVs) have played a crucial role in deploying communication satellites into geosynchronous transfer orbits.
- According to the European Space Agency (ESA), telecommunications satellites are typically positioned in geostationary Earth orbit (GEO), which is a circular orbit located 35,786 kilometers above the Earth's equator
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For Prelims: Current events of national and international importance
For Mains: Space technology, Important contributions of Indians in Science and Technology
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Previous Year Questions
1. With reference to India's satellite launch vehicles, consider the following statements: (UPSC 2018)
1. PSLVs launch satellites useful for Earth resources monitoring whereas GSLVs are designed mainly to launch communication satellites.
2. Satellites launched by PSLV appear to remain permanently fixed in the same position in the sky, as viewed from a particular location on Earth.
3. GSLV Mk III is a four- staged launch vehicle with the first and third stages using solid rocket motors; and the second and fourth stages using liquid rocket engines.
Which of the statements given above is/are correct?
A. 1 only
B. 2 and 3
C. 1 and 2
D. 3 only
Answer: A
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Source: Indianexpress
AIR POLLUTION
1. Context
A recent report stated that India is home to 83 of the 100 most polluted cities in the world. Another report from the British Medical Journal estimated that air pollution led to the deaths of 2.1 million people in India, the second largest numbers after China. Over 99% of the population breathes air that is poorer than the recommended WHO standards
2. Air Pollution and its severity
According to the International Energy Associates, road transport accounts for 12% of India’s CO2 emissions, with heavy vehicles being the primary source of Particulate Matter (PM) 2.5 emissions. PM2.5 consists of tiny particles that can penetrate deeply into the lungs and enter the bloodstream, leading to various respiratory and cardiovascular issues. Heavy vehicles also play a major role in emitting Nitrogen Oxide (NOx), which has similar health effects. NOx contributes to the formation of ground-level ozone, which degrades air quality and increases heat, exacerbating air pollution in urban areas. Research shows that heavy vehicles are responsible for approximately 60-70% of vehicular PM emissions and about 40-50% of NOx emissions in cities
3. Measures to Control Air Pollution
- With the transport sector expanding at a rate of 9.1% annually, the Bureau of Energy Efficiency’s (BEE) effort to develop draft Corporate Average Fuel Economy (CAFE) standards for cars in India is both timely and commendable.
- The planned implementation timelines for CAFE III (2027-2032) and CAFE IV (2032-2037) are practical. Transitioning from the Modified India Driving Cycle (MIDC) to the World Light Duty Vehicle Testing Procedure (WLTP) starting March 31, 2027, is a positive move, as the WLTP provides a more accurate and globally standardized assessment of a vehicle's fuel consumption and CO2 emissions.
- The proposed emissions targets under CAFE III at 91.7g CO2/km and CAFE IV at 70g CO2/km are achievable. These stringent CO2 targets are crucial for fostering innovation and promoting the adoption of cleaner technologies.
- For the benefit of both the environment and public health, these targets should remain firm.
- However, it is important to note that the CAFE norms do not cover emissions from heavy vehicles such as trucks and lorries
4. Government Initiatives to Control air pollution
- In 2022, the government launched a vehicle scrappage policy aimed at retiring old and polluting vehicles, including heavy-duty ones. The policy requires passenger vehicles older than 20 years and commercial vehicles older than 15 years to pass a “fitness and emissions test.”
- Vehicles that fail these tests are deemed end-of-life, lose their registration certificates, and are recommended for scrapping.
- However, the policy has not yet been effectively implemented in Karnataka due to the limited number of scrapyards (only two in the entire state) and its voluntary nature.
- In Bangalore, many older vehicles are not four-wheelers but include older BMTC buses, private vans, and heavy vehicles.
- Maharashtra, among 21 states, has introduced incentives like road tax discounts or new vehicle purchase reductions to promote scrapping, but these measures have yet to significantly impact air pollution. It is crucial for policymakers to ensure that these guidelines are not just theoretically sound but practically enforced.
- Current government measures to address air pollution—such as regular vehicle emissions testing, banning open garbage burning, and monitoring industrial emissions—must be strictly enforced.
- While the government's efforts to reduce air pollution are commendable, it is important to emphasize that expanding mass transit is essential for a sustainable approach to tackling air pollution in India
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For Prelims: National Clean Air Programme, Air Pollution, Particulate Matter, Clean Air Action Plans For Mains:
1. What are the challenges and opportunities presented by the National Clean Air Programme (NCAP) for improving air quality in Indian cities? Discuss the measures required to overcome implementation hurdles and ensure the effective management of air pollution. (250 Words)
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Previous Year Questions
1. In the cities of our country, which among the following atmospheric gases are normally considered in calculating the value of Air Quality Index? (UPSC 2016)
Select the correct answer using the code given below: A. 1, 2 and 3 only B. 2, 3 and 4 only C. 1, 4 and 5 only D. 1, 2, 3, 4 and 5 2. Which of the following are the reasons/factors for exposure to benzene pollution? (UPSC 2020)
Select the correct answer using the code given below: A. 1, 2 and 3 only B. 2 and 4 only C. 1, 3 and 4 only D. 1, 2, 3, 4 and 5
3. What is the ‘Greenhouse Gas Protocol’? (UPSC 2016) (a) It is an international accounting tool for government and business leaders to understand, quantify and manage greenhouse gas emissions
(b) It is an initiative of the United Nations to offer financial incentives to developing countries to reduce greenhouse gas emissions and to adopt eco-friendly technologies.
(c) It is an inter-governmental agreement ratified by all the member countries of the United Nations to reduce greenhouse gas emissions to specified levels by the year 2022
(d) It is one of the multilateral REDD+ initiatives hosted by the World Bank
4. Photochemical smog is a resultant of the reaction among (UPSC 2013) (a) NO2, O3 and peroxyacetyl nitrate in the presence of sunlight
(b) CO, O2 and peroxyacetyl nitrate in the presence of sunlight
(c) CO, CO2 and NO2 at low temperature
(d) high concentration of NO2 O3 and CO in the evening
5. Acid rain is caused by the pollution of the environment (UPSC 2013, 2022) (a) Carbon Dioxide and Nitrogen
(b) Carbon Monoxide and Carbon Dioxide
(c) Ozone and Carbon Dioxide
(d) Nitrous Oxide and Sulphur Dioxide
6. Biological Oxygen Demand (BOD) is a standard criterion for (UPSC 2017) (a) Measuring oxygen level in blood
(b) Computing oxygen levels in forest ecosystems
(c) Pollution assay in aquatic ecosystem
(d) Assessing oxygen levels in high-altitude regions
7. The Ministry of Environment, Forest and Climate Change recently published the draft Environment Impact Assessment (EIA) Notification, in 2020. Which of the following statements is correct about EIA? (Punjab Civil Service 2020)
1. It predicts the effect of a proposed industrial/infrastructural project on the environment.
2. It prevents the proposed activity/project from being approved without proper oversight or taking adverse consequences into account.
3. It compares various alternatives for a project and seeks to identify the one which represents the best combination of economic and environmental costs and benefits.
4. As per the new notification, Coal and non-Coal mineral prospecting and solar photovoltaic projects do not need prior environmental clearance.
Select the correct answer using the code given below:
A. Only 1 and 2
B. Only 2, 3 and 4
C. Only 1, 2 and 3
D. Only 1, 2 and 4
8. Headquarters of the World Meteorological Organization is located in (NDA 2017)
A. Washington B. Geneva C. Moscow D. London
9. With reference to the 'Global Climate Change Alliance', which of the following statements is/are correct? (UPSC 2017)
1. It is an initiative of the European Union.
2. It provides technical and financial support to targeted developing countries to integrate climate change into their development policies and budgets.
3. It is coordinated by World Resources Institute (WRI) and World Business Council for Sustainable Development (WBCSD)
Select the correct answer using the code given below:
A. 1 and 2 only B. 3 only C. 2 and 3 only D. 1, 2 and 3
10. The IPCC is the United Nations body for assessing the science related to climate change. IPCC stands for: (RRB NTPC CBT 2 2022)
A. Intergovernmental Provision on Climate Change
B. International Panel on Climate Change
C. International Provision on Climate Change
D. Intergovernmental Panel on Climate Change
11. Comprehension (SSC CHSL 2020)
Direction: In the following passage some words have been deleted. Fill in the blanks with the help of the alternatives given. Select the most appropriate option for each blank.
Forest fire always (1) ______ by one of two reasons-naturally caused or human-caused. Natural fire is generally (2) ______ by lightning, with a very small percentage (3) ______ by spontaneous combustion of dry fuel such as sawdust and leaves. (4) ______, human-caused fire can happen (5) ______ any number of reasons.
Select the most appropriate option for blank No. 1.
A. takes up B. happens C. causes D. creates
12. Which of the following statements best describes the term 'Social Cost of Carbon'? It is a measure, in monetary value, of the (UPSC 2020)
A. long-term damage done by a tonne of CO2 emission in a given year.
B. requirement of fossil fuels for a country to provide goods and services to its citizens, based on the burning of those fuels.
C. efforts put in by a climate refugee to adapt to live in a new place.
D. contribution of an individual person to the carbon footprint on the planet Earth.
13. The increasing amount of carbon dioxide in the air is slowly raising the temperature of the atmosphere, because it absorbs (UPSC 2012)
A. the water vapour of the air and retains its heat
B. the ultraviolet part of the solar radiation
C. all the solar radiations
D. the infrared part of the solar radiation
14. As per the World Health Organisation (WHO) recommendation of a balanced diet, to avoid unhealthy weight gain, total fat should NOT exceed _______ of total energy intake. (UPSSSC Mandi Inspector 2019)
A. 20% B. 30% C. 10% D. 40%
15. What is the role of ultraviolet (UV) radiation in the water purification systems? (UPSC 2012)
1. It inactivates/kills the harmful microorganisms in water.
2. It removes all the undesirable odours from the water.
3. It quickens the sedimentation of solid particles, removes turbidity and improves the clarity of water.
Which of the statements given above is/are correct?
A. 1 only B. 2 and 3 only C. 1 and 3 only D. 1, 2 and 3
16. Which of the following ultraviolet rays is more dangerous? (UPTET 2017)
A. UV-A B. UV-B C. UV-C D. None of the above
17. Consider the following statements: (UPSC 2019)
1. Agricultural soils release nitrogen oxides into environment.
2. Cattle release ammonia into environment.
3. Poultry industry releases reactive nitrogen compounds into environment.
Which of the statements given above is/are correct?
A. 1 and 3 only B. 2 and 3 only C. 2 only D. 1, 2 and 3
18. Which of the following is a VOC? (MP Vyapam 2022)
A. Toulene B. Water C. Carbon dioxide D. Carbon monoxide
19. Volatile Organic Compounds (VOCs) are of great concern because (UGC NET Environmental Science 2020)
A. Once such compounds are in the vapour state, they are difficult to control in the environment.
B. Most of them are ozone-depleting substances
C. They contribute to a general increase in reactive hydrocarbons in the atmosphere.
D. They are less soluble in water.
Answers: 1-B, 2-A, 3-A, 4-A, 5-D, 6-C, 7-D, 8-B, 9-A, 10-D, 11-B, 12-A, 13-D, 14-B, 15-A, 16-C, 17-D, 18-A, 19-C
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Source: The Hindu
SPACE WEATHER
1. Context
Astronomers from the Indian Institute of Astrophysics (IIA) have found a new method to predict the amplitude of the upcoming solar cycle. Besides, their research can also help in space weather forecasting.
2. What is Space weather?
Space weather refers to the environmental conditions in space that can affect space-borne and ground-based technological systems. It encompasses a range of phenomena associated with the Sun and its interaction with Earth's magnetosphere and atmosphere
Space weather is monitored by various space agencies and organizations using satellites and ground-based observatories. Prediction models and forecasting systems are used to anticipate space weather events and mitigate their potential impacts on technology and infrastructure
3. What are different types of space weather?
Space weather refers to the conditions in space that can affect technological systems in orbit and on Earth.It's primarily driven by solar activity.
Here are some of the main types:
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Solar Flares:
- Sudden, intense bursts of radiation from the Sun's surface that can affect satellite communications, GPS systems, and power grids on Earth.
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Coronal Mass Ejections (CMEs):
- Large bursts of solar wind and magnetic fields rising above the solar corona or being released into space. CMEs can lead to geomagnetic storms that may disrupt communications and navigation systems.
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Solar Wind:
- A stream of charged particles (mainly electrons and protons) emitted by the Sun. Variations in solar wind can impact the Earth's magnetic field and cause geomagnetic storms.
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Geomagnetic Storms:
- Disturbances in Earth's magnetosphere caused by solar wind and CMEs. These storms can induce electric currents that affect power grids and satellite systems.
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Auroras:
- Natural light displays in the sky, such as the Northern and Southern Lights, caused by charged particles from the solar wind interacting with Earth's magnetic field and atmosphere.
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Space Radiation:
- High-energy particles from the Sun and cosmic rays that can pose health risks to astronauts and passengers on high-altitude flights, and can affect electronic systems and satellites
4. How does Space weather affect Earth?
Space weather can have various effects on Earth and its technological systems.
Here’s how different aspects of space weather impact our planet:
- Solar flares and geomagnetic storms can disrupt satellite communications, affecting television broadcasts, internet services, and emergency communications.
- GPS satellites can experience signal degradation or loss, impacting navigation systems used in aviation, shipping, and personal devices
- High-energy particles from solar flares and CMEs can damage satellite electronics and sensors, potentially leading to satellite malfunctions or failures
- Geomagnetic storms can induce electric currents in power lines, transformers, and other components of the power grid. This can lead to voltage fluctuations, equipment damage, and even large-scale power outages
- Increased currents can stress power infrastructure, potentially leading to transformer failures and long-term damage to the power grid
- Solar flares can cause ionospheric disturbances, leading to radio blackouts. This affects shortwave radio communications, which are crucial for aviation, maritime operations, and emergency services
- Space weather can cause interference with various types of radio signals, impacting both terrestrial and space-based communication systems
- High-altitude flights, particularly near the polar regions, can experience increased radiation exposure during solar storms. This poses health risks to passengers and crew and can affect avionics systems
- Disruptions in satellite-based navigation systems and radio communications can affect flight safety and operation
- Space radiation from solar energetic particles poses health risks to astronauts. Increased radiation levels during solar storms can affect their health and safety during space missions.
- High-energy particles can damage spacecraft electronics and sensors, potentially leading to operational issues or failures
- Geomagnetic storms can induce electric currents in pipelines and railways, potentially leading to corrosion and operational problems
- While primarily a visual phenomenon, auroras indicate increased geomagnetic activity and serve as a visual marker of space weather effects
- Intense auroral activity can sometimes be associated with other space weather impacts, such as increased radiation or communication disruptions
5. Prediction and Monitor Space Weather
Satellites:
- Solar Observatories: Satellites like the Solar and Heliospheric Observatory (SOHO), the Solar Dynamics Observatory (SDO), and the Solar Terrestrial Relations Observatory (STEREO) monitor the Sun’s activity, including solar flares, coronal mass ejections (CMEs), and solar wind.
- Space Weather Satellites: Instruments on satellites such as the NOAA’s GOES series (Geostationary Operational Environmental Satellites) and the NASA’s Parker Solar Probe observe space weather phenomena and provide real-time data on solar radiation and particle fluxes.
Ground-Based Observatories:
- Magnetometers: Ground-based magnetometers measure changes in Earth's magnetic field, helping to detect geomagnetic storms and fluctuations.
- Radio Telescopes: Radio telescopes monitor solar radio emissions that can indicate solar flare activity and other solar phenomena.
Space-Based Instruments:
- Plasma Detectors: Instruments aboard spacecraft measure the properties of the solar wind and charged particles, providing data on solar wind speed, density, and temperature.
- Radiation Detectors: Spacecraft and satellites equipped with radiation detectors measure levels of solar energetic particles and cosmic rays.
6. How can we prepare for and mitigate the effects of space weather?
Preparing for and mitigating the effects of space weather involves a combination of proactive measures, technological solutions, and strategic planning.
Here’s how individuals, organizations, and governments can prepare for and reduce the impacts of space weather:
Satellite Protection:
- Shielding: Equip satellites with shielding to protect sensitive electronics from radiation and high-energy particles.
- Redundancy: Design satellites with redundant systems to ensure continued operation if primary systems fail due to space weather impacts.
- Radiation Hardened Components: Use radiation-hardened components to minimize damage from space radiation
Power Grid Management:
- Grid Monitoring: Implement advanced monitoring systems to detect and manage geomagnetic induced currents in power grids.
- Protective Measures: Use geomagnetic storm forecasting to prepare power grids and install protective devices, such as series capacitors, to reduce the impact of induced currents.
- Operational Procedures: Develop and practice contingency plans for power grid operators to respond to space weather events
7. Challenges and future of Space Weather research
- Solar flares, coronal mass ejections (CMEs), and geomagnetic storms are highly complex and can be difficult to predict with high accuracy
- The interactions between solar wind, Earth's magnetosphere, and the ionosphere involve complex physical processes that are not fully understood
- Space weather monitoring relies on a limited number of satellites and ground-based observatories, which may not cover all necessary areas
- The vast amount of data collected from various sources can be challenging to process and analyze efficiently
- Existing models for predicting space weather events have limitations in accuracy and reliability, especially for predicting the impact of solar activity on Earth’s technological systems
- Providing timely and accurate forecasts remains a significant challenge due to the rapid and dynamic nature of space weather events
- The impacts of space weather on different systems (e.g., power grids, satellites, aviation) can vary widely, making it difficult to assess and mitigate risks comprehensively
- Understanding and predicting the long-term effects of space weather on infrastructure and technology is still an emerging area of research
- Space weather research and monitoring require significant investment in technology, infrastructure, and human resources, which can be limited
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For Prelims: Solar flares, Solar Eclipse, Corona holes
For Mains: GS III - General Science, Science & technology
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Source: The Hindu
NON BANKING FINANCIAL COMPANIES (NBFC)
1. Context
Non-banking finance companies (NBFCs) will likely post a robust growth of almost 15% in gold loan business in FY25 despite the recent regulatory actions taken by the Reserve of India (RBI)
2. What are the non-banking financial companies (NBFCs)?
- Non-Banking Financial Companies (NBFCs) are financial institutions that provide banking services but do not hold a banking license.
- They are crucial to the financial system as they cater to the financial needs of sectors where traditional banks may not reach or provide services.
- NBFCs offer various financial services such as loans and advances, acquisition of shares/stocks/bonds/debentures/securities issued by Government or local authority, leasing, hire-purchase, insurance business, chit business, etc.
- They differ from traditional banks because they cannot accept demand deposits and do not form part of the payment and settlement system like banks do.
- However, they play a significant role in providing credit to individuals, small businesses, and the unorganised sector, thereby contributing to financial inclusion and economic growth. Examples of NBFCs include companies engaged in equipment leasing, hire-purchase finance, vehicle finance, and microfinance
3. Classification of NBFCs
NBFCs can be classified into various categories based on their activities, ownership structure, and regulatory requirements.
Here are some common classifications:
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Asset Financing NBFCs: These NBFCs primarily provide financing for the purchase of assets such as vehicles, machinery, equipment, etc.
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Investment and Credit NBFCs: These NBFCs primarily make investments in securities or extend credit facilities.
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Infrastructure Finance Companies (IFCs): These NBFCs focus on financing infrastructure projects such as roads, ports, power, telecommunications, etc.
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Housing Finance Companies (HFCs): These NBFCs specialize in providing finance for housing and related activities.
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Microfinance Institutions (MFIs): These NBFCs provide financial services, including small loans, savings, and insurance, to low-income individuals and microenterprises.
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Non-Deposit Taking NBFCs: These NBFCs do not accept deposits from the public. They rely on other sources of funding such as borrowings from banks, financial institutions, and capital markets.
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Deposit Taking NBFCs: These NBFCs accept deposits from the public and are regulated more closely, similar to banks, to ensure the safety of depositor funds.
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Systemically Important NBFCs (SI-NBFCs): These are NBFCs whose failure could potentially disrupt the financial system. They are subject to additional regulatory requirements to mitigate systemic risks.
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Core Investment Companies (CICs): These NBFCs are primarily engaged in the business of acquisition of shares and securities and hold not less than 90% of its Total Assets in the form of investment in equity shares, preference shares, bonds, debentures, debt, or loans in group companies.
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Infrastructure Debt Funds (IDFs): These NBFCs are set up to facilitate the flow of long-term debt into infrastructure projects.
4. What is the 50-50 Criteria of Principal Business?
- The 50-50 criteria of principal business refers to a regulatory guideline set by the Reserve Bank of India (RBI) for determining whether a company's principal business is that of a Non-Banking Financial Company (NBFC).
- According to this criterion, if more than 50% of a company's total assets or gross income comes from financial assets or income derived from financial assets, it is considered to be primarily engaged in the business of an NBFC. In other words, if at least 50% of the company's assets or income is from financial activities, it falls under the purview of NBFC regulations.
- This guideline helps to differentiate between companies engaged primarily in non-financial activities with some incidental financial activities and those whose main business revolves around financial services, thereby ensuring appropriate regulation and supervision of NBFCs by the RBI. It is an important criterion used by regulators to determine the regulatory classification of companies operating in the financial sector
5.RBI rules on Non Banking Financial Companies
The Reserve Bank of India (RBI) regulates Non-Banking Financial Companies (NBFCs) in India to ensure financial stability, consumer protection, and the smooth functioning of the financial system.
Some of the key rules and regulations imposed by the RBI on NBFCs include:
- NBFCs need to obtain a Certificate of Registration (CoR) from the RBI to commence or carry on the business of non-banking financial institution.
- RBI imposes prudential regulations on NBFCs to ensure the safety and soundness of their operations. These norms cover aspects such as capital adequacy, income recognition, asset classification, provisioning, liquidity management, and exposure limits.
- NBFCs are required to adhere to a Fair Practices Code (FPC) prescribed by the RBI, which outlines the principles of transparency, fairness, and responsible lending practices.
- NBFCs are mandated to follow KYC norms while onboarding customers, including verification of identity, address, and other relevant information, to prevent money laundering and terrorist financing activities
- NBFCs are required to implement effective AML/CFT measures, including customer due diligence, transaction monitoring, and reporting of suspicious transactions, to mitigate the risks of money laundering and terrorist financing.
- RBI mandates NBFCs to adhere to good corporate governance practices, including the composition of the board of directors, risk management framework, internal controls, and disclosure requirements
- NBFCs are required to have robust risk management systems in place to identify, assess, monitor, and mitigate various risks such as credit risk, market risk, liquidity risk, and operational risk.
- NBFCs need to submit various regulatory returns and reports to the RBI periodically, providing details of their financial performance, capital adequacy, asset quality, and compliance with regulatory requirements.
- RBI conducts regular inspections and supervisory reviews of NBFCs to assess their financial health, compliance with regulations, and adherence to best practices.
- RBI has the authority to issue directions, impose restrictions, and take corrective actions against NBFCs that fail to comply with regulatory requirements or pose risks to the financial system.
6. Way Forward
Non-Banking Financial Companies (NBFCs) play a vital role in India's financial landscape, serving as critical intermediaries between traditional banking institutions and underserved segments of the economy. With their diverse range of financial services and flexible approach to lending, NBFCs contribute significantly to promoting financial inclusion, fostering entrepreneurship, and driving economic growth. However, the regulatory framework governing NBFCs remains paramount in ensuring the stability and integrity of the financial system. As the sector continues to evolve and face new challenges, effective regulation, prudent risk management, and adherence to best practices will be essential for NBFCs to sustain their growth trajectory and fulfill their socio-economic mandate in a responsible and sustainable manner
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For Prelims: Economy
For Mains: GS-III: Indian Economy and issues relating to planning, mobilisation, of resources, growth, development, and employment.
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Previous Year Questions 1.The RBI acts as a bankers’ bank. This would imply which of the following? (UPSC CSE 2012) 1. Other banks retain their deposits with the RBI. 2. The RBI lends funds to the commercial banks in times of need. 3. The RBI advises the commercial banks on monetary matters. Select the correct answer using the codes given below : (a) 2 and 3 only (b) 1 and 2 only (c) 1 and 3 only (d) 1, 2 and 3 Answer (d)
The central bank, also known as the apex bank, has overarching control over a nation's banking system. It holds the exclusive authority for issuing currency and regulates the money supply within the economy. As outlined in the Reserve Bank of India Act, 1934, the central bank fulfills several key functions:
2.With reference to the Non-banking Financial Companies (NBFCs) in India, consider the following statements: (UPSC CSE 2010)
Which of the statements given above is/are correct? (a) 1 only Answer: (b)
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Source: Indianexpress
UNIFORM CIVIL CODE (UCC)
1. Context
Invoking the Constitution and the Supreme Court, Prime Minister Narendra Modi made a strong pitch Thursday for the Uniform Civil Code, saying it’s time the country moves towards a civil code that is “secular” and not “communal” and “discriminatory” as the existing one
2. 22nd law commission on UCC
- Underlining that the Uniform Civil Code is “neither necessary nor desirable at this stage”, the 21st Law Commission of India, in 2018, argued for reform of family laws of every religion through amendments and codification of certain aspects so as to make them gender-just
- In its ‘Consultation Paper on Family Law Reforms’, the Law Commission took a stand in favour of “equality ‘within communities’ between men and women” (personal law reform), “rather than ‘equality between’ communities” (UCC)
- According to the 22nd Law Commission Cultural diversity cannot be compromised to the extent that our urge for uniformity itself becomes a reason for threat to the territorial integrity of the nation
- women must be guaranteed their freedom of faith without any compromise on their right to equality
3. What is the Uniform Civil Code
- A UCC would provide for one law for the entire country, applicable to all religious communities, in their personal matters such as marriage, divorce, inheritance, adoption etc
- Currently, Indian personal law is fairly complex, with each religion adhering to its own specific laws
- Separate laws govern Hindus including Sikhs, Jains and Buddhist, Muslims, Christians, and followers of other religions
- Moreover, there is diversity even within communities. All Hindus of the country are not governed by one law, nor are all Muslims or all Christians
- For instance, in the Northeast, there are more than 200 tribes with their own varied customary laws
- The Constitution itself protects local customs in Nagaland. Similar protections are enjoyed by Meghalaya and Mizoram. Even reformed Hindu law, in spite of codification, protects customary practices
- The exception to this rule is the state of Goa, where all religions have a common law regarding marriages, divorces, and adoption
4. Constitution on UCC
- Article 44 of the Constitution lays down that the state shall endeavour to secure a UCC for citizens throughout the territory of India
- Article 44 is among the Directive Principles of State Policy. Directive Principles are not enforceable by court, but are supposed to inform and guide governance
- However, in some senses, Article 44 is unique in this manner. While Article 44 uses the words “state shall endeavour”, other Articles in the ‘Directive Principles’ chapter use words such as “in particular strive”; “shall in particular direct its policy”; “shall be obligation of the state
- The phrase “by suitable legislation” is absent in Article 44. All this implies that the duty of the state is greater in other directive principles than in Article 44
5. Uniform Code for Personal Law
Article 25 lays down an individual’s fundamental right to religion; Article 26(b) upholds the right of each religious denomination or any section thereof to “manage its own affairs in matters of religion”
Article 29 defines the right to conserve distinctive culture
An individual’s freedom of religion under Article 25 is subject to “public order, health, morality” and other provisions relating to fundamental rights, but a group’s freedom under Article 26 has not been subjected to other fundamental rights
6. Way forward
Over the next 30 days, the Law Commission will receive views of the public and stakeholders
The notice said the stakeholders concerned are at liberty to make submissions in the form of consultation/discussion/working papers on any of the issues pertaining to the UCC to the Member Secretary, Law Commission of India
After reviewing the submissions, the Law Commission will again make observations/recommendations regarding a UCC, which may or may not differ from the previous Commission’s observations
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For Prelims: Unifrom Civil Code (UCC), DPSP, Fundamental rights, Law Commission
For Mains: 1. What is the Uniform Civil Code? What are the challenges in implementing a Uniform Civil Code in a diverse country like India?
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Previous Year Questions
Q1. Consider the following provisions under the Directive Principles of State Policy as enshrined in the Constitution of India: (2012)
Which of the above are the Gandhian Principles that are reflected in the Directive Principles of State Policy? (a) 1, 2 and 4 only Answer (b) 2. A legislation that confers on the executive or administrative authority an unguided and uncontrolled discretionary power in the matter of the application of law violates which one of the following Articles of the Constitution of India? Answer (a) Mains 1.Discuss the possible factors that inhibit India from enacting for its citizens a uniform civil code as provided for in the Directive Principles of State Policy. (2015) |
Source: indianexpress
