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DAILY CURRENT AFFAIRS, 28 SEPTEMBER 2024

AIR QUALITY INDEX (AQI)

 

1. Context

Court accuses Commission of non-compliance with the law, says its actions must translate into actual reduction of pollution; CAQM says it has taken steps to address stubble-burning ; SC asks panel to file a status report by October 3
 

2. The Air Quality Index (AQI)

The AQI is a colour-coded index launched under the Swachh Bharat campaign to simplify the understanding of pollution levels. It helps convey the condition of the air and guides appropriate measures based on the severity of pollution. The AQI consists of six categories, each with a corresponding colour code: 'Good' (0-50), 'Satisfactory' (51-100), 'Moderately Polluted' (101-200), 'Poor' (201-300), 'Very Poor' (301-400) and 'Severe' (401-500).

3. Calculation of AQI

  • To calculate the AQI, a technical study was conducted by an expert group, including medical professionals, air quality experts, and academics.
  • Various pollutants, such as PM10, PM2.5, Nitrogen Dioxide, Ozone, Carbon, and others, are measured.
  • Each pollutant is assigned a weight based on its impact on human health.
  • The composite air quality index is determined by combining these weights, simplifying multiple data points into a single number and colour to represent overall air quality.
  • Monitoring stations across the country assess these pollutant levels.

4. Impact of Pollutants on Health

  • Among the most harmful pollutants are fine particulate matter, such as PM2.5, which has a diameter smaller than 2.5 micrometres.
  • PM2.5 particles can easily enter the circulatory system, bypassing the nose and throat.
  • They are associated with respiratory problems and reduced visibility, posing health risks such as asthma, heart attacks, bronchitis, and other respiratory issues.

5. Influence on Government Policy

  • Governments, especially in areas like Delhi, use the AQI to announce measures to combat air pollution.
  • When the AQI in the National Capital Region (NCR) reaches the 'severe' category, Stage 4 of the Graded Response Action Plan (GRAP) is implemented.
  • GRAP is designed for emergency measures to prevent further deterioration of air quality.
  • Specific actions may include prohibiting the use of non-BS-VI-compliant diesel four-wheelers and restricting the entry of trucks into the city while allowing petrol cars to continue operating as usual.

6. Conclusion

The Air Quality Index is an essential tool that simplifies the understanding of air pollution, assesses its health impacts, and influences government policies and actions to combat deteriorating air quality. As Mumbai braces for worsening air quality, the AQI will continue to be a critical resource for both the government and the public.

 
For Prelims: Air Pollution, Air Quality Index, PM 2.5, PM 10, BS-VI Vehicles, Graded Response Action Plan, National Capital Region, Nitrogen Dioxide, Ozone, Carbon, 
For Mains: 
1. With the onset of worsening air quality in Mumbai, discuss the importance of the AQI as a critical resource for both the government and the public. How can the AQI assist in addressing air pollution-related challenges in the upcoming winter months? (250 Words)

 

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)
  1. Carbon dioxide
  2. Carbon monoxide
  3. Nitrogen dioxide
  4. Sulfur dioxide
  5. Methane

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

Answer: B

2. Which of the following are the reasons/factors for exposure to benzene pollution? (UPSC 2020)

  1. Automobile exhaust
  2. Tobacco smoke
  3. Wood burning
  4. Using varnished wooden furniture
  5. Using products made of polyurethane

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

AnswerA

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

Answer: A

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

Answer: A

 

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

 Answer: D

 

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

Answer: C

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
Answer: D
 
8.  Headquarters of the World Meteorological Organization is located in (NDA 2017)
A. Washington        B. Geneva         C. Moscow         D.  London
 
Answer: B
 
 
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
Answer: A
 
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
 
Answer: D
 
 
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
 
Answer: B
 
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.
 
Answer: A
 
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
 
Answer: D
 
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%
 
Answer: B
 
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
 
Answer: A
 
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
 
Answer: C
 
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
 
Answer: D
 
18. Which of the following is a VOC? (MP Vyapam 2022) 
A. Toulene          B. Water            C. Carbon dioxide          D. Carbon monoxide
 
Answer: A
 
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.
 
Answer: C

 Source: The Indian Express

PARAM RUDRA

 
 
1. Context
 
Three new supercomputers, installed at premier scientific institutions in Delhi, Pune and Kolkata, to boost research in the fields of astronomy, medicine and high-energy physics, were on Thursday dedicated to the nation by Prime Minister Narendra Modi.
 
2. PARAM Rudra
 
  • PARAM Rudra is an autonomous underwater vehicle (AUV) developed by the Defence Research and Development Organisation (DRDO) of India. It is designed for various underwater missions, including surveillance, mine detection, and oceanographic data collection. The AUV can operate autonomously, navigate underwater environments, and carry various payloads like sonar systems and cameras
  • PARAM Rudra is designed for various high-performance computing applications, including scientific simulations, artificial intelligence, and big data analytics
  •  It uses a hybrid CPU-GPU architecture, combining traditional processors with graphics processing units for enhanced parallel computing capabilities
  • The supercomputer is used in various fields such as weather forecasting, climate modeling, molecular dynamics, quantum mechanics, and computational fluid dynamics
 
3. Key takeaways
 
  • PARAM Rudra supercomputers are locally developed by the Centre for Development of Advanced Computing (C-DAC) as part of the National Supercomputing Mission (NSM).

  • These supercomputers have been installed in Pune, Delhi, and Kolkata to enable significant advancements in scientific research.

(i) Pune's Giant Metre Radio Telescope (GMRT): This facility will leverage the supercomputer to investigate Fast Radio Bursts (FRBs) and other cosmic events.

(ii) Delhi's Inter-University Accelerator Centre (IUAC): The supercomputer will enhance research in areas like material science and atomic physics.

(iii) Kolkata's S.N. Bose Centre: It will facilitate cutting-edge research in fields such as physics, cosmology, and earth sciences.

  • Among these, the most powerful is at IUAC, boasting a 3 petaflop capacity. GMRT's supercomputer has a capacity of 1 petaflop, while the system at S.N. Bose Institute offers 838 teraflops.

  • Additionally, computational capacity for weather and climate studies has seen major improvements with the installation of High-Power Computing (HPC) systems at two atmospheric science institutes, one in Pune and one in Noida, both of which now have their own supercomputers.

  • The Arka system at IITM, with a capacity of 11.77 petaflops, will for the first time enhance the nation's global weather prediction models by improving horizontal resolution from 12 km to 6 km. The HPC Arunika, with 8.24 petaflops, will aid in enhancing weather forecast precision at the block level.

4. National Supercomputing Mission
 
  • The National Supercomputing Mission (NSM), launched in 2015, aims to link national academic and research institutions through a network of high-performance computing facilities.

  • NSM is jointly overseen by the Department of Science and Technology (DST) and the Ministry of Electronics and IT (MeitY). Its implementation is handled by the Centre for Development of Advanced Computing (C-DAC) in Pune and the Indian Institute of Science (IISc) in Bengaluru.

  • The mission's goal is to build a robust supercomputing infrastructure in India to enhance research capabilities. Its primary objectives include:

— Establishing India as a global leader in high-performance computing (HPC) and strengthening the nation's ability to tackle major national and global challenges.

— Equipping scientists and researchers with advanced computing resources for conducting groundbreaking research in their fields.

— Minimizing redundancies and avoiding duplication of investments.

— Developing an ecosystem that positions India as a major supercomputing power, ensuring global competitiveness and self-reliance in HPC.

  • The mission is divided into three phases: phase I focuses on assembling supercomputers, phase II on manufacturing key components domestically, and phase III on designing supercomputers entirely within India
 
National Quantum Mission
 
  • In 2023, India announced the launch of the National Quantum Mission to develop expertise in quantum science and technology. The mission focuses on four key areas: quantum computing, communications, sensors, and materials.

  • With a budget of Rs 6,003.65 crore, the mission will fund scientific and industrial research projects over eight years (2023-2031). It includes the creation of four thematic hubs (T-Hubs), each dedicated to one of the four areas. Each domain will have specific goals and challenges. Before delving into these areas, it's essential to understand what quantum technology entails

 
 
5. Challenges in Supercomputing
 
  • FLOPs, or Floating-Point Operations per Second, is a widely used measure for assessing computational performance, particularly in high-performance computing (HPC) and artificial intelligence (AI). It refers to a type of mathematical operation that involves real numbers with fractional components.
  • While FLOPs are important, they are not the only factor influencing a system's performance. Other elements like memory bandwidth, latency, and architectural design also play crucial roles.
  • However, FLOPs provide a useful benchmark for comparing the computational power of different systems, especially for tasks heavily reliant on floating-point calculations.
  • Given the vast processing capabilities of modern computers, FLOPs are typically expressed in billions (giga), trillions (tera), or even quadrillions (peta) of operations per second (GFLOPs, TFLOPs, PFLOPs, respectively). A petaflop equals 1,000 TFLOPs or 10¹⁵ FLOPs
 
 
For Prelims: Semiconductor, Transistors, Fabrication Technology
 
For Mains: 
1. Discuss the recent global chip shortage and its implications for India's semiconductor industry. What steps has India taken to enhance its domestic chip manufacturing capabilities? (250 Words)
 
Previous Year Questions
 
1. Which of the following fabrication techniques is ideally suited for digital ICs?
(KVS TGT WET 2017)
 
A. Monolithic        B. Thin film      C. Hybrid              D. Thin film and hybrid
 
Answer: A
 
Source: Indianexpress
 
 

SOVEREIGN GREEN BONDS

 
 
 
1. Context
 
The government would take a decision on issuing fresh sovereign gold bonds (SGBs) based on the need and assessment of market conditions, said sources.Experts, however, feel that the government does not seem keen on issuing fresh gold bonds given the overall cost and rising gold prices.
 
 
2. About Sovereign Green Bonds
 
  • Sovereign Green Bonds are a type of government debt instrument issued by a sovereign nation specifically to finance environmentally sustainable projects. These bonds are dedicated to funding initiatives that contribute to the transition to a low-carbon economy, mitigate climate change, and promote environmental sustainability.
  • The proceeds from Sovereign Green Bonds are earmarked for projects such as renewable energy infrastructure development, energy efficiency improvements, green transportation initiatives, sustainable agriculture, and other environmentally friendly endeavours.
  • The key characteristic of Sovereign Green Bonds is their alignment with internationally recognized green finance principles and standards.
  • Issuers typically establish a framework outlining the types of projects eligible for financing through these bonds, ensuring transparency and accountability in the allocation of funds.
  • Investors in Sovereign Green Bonds are attracted not only by the financial returns but also by the opportunity to support sustainable development and address pressing environmental challenges.
 

3. Facilitating the Green Transition

 

  • Enabling Foreign Institutional Investors (FIIs) to invest in India's green projects expands the financial resources available to support the country's ambitious goals for transitioning to a greener economy by 2070. These goals include ensuring that 50% of India's energy is sourced from non-fossil fuel-based sources and reducing the carbon intensity of the nation's economy by 45%, as pledged by Prime Minister Narendra Modi at COP26 in Glasgow in 2021.
  • The Reserve Bank of India (RBI) had issued Sovereign Green Bonds (SGrBs) worth ₹16,000 crore in two tranches in January and February of the previous year, with maturities in 2028 and 2033. While these bonds were oversubscribed on both occasions, the primary participants were domestic financial institutions and banks, limiting the avenues for government borrowing. Additionally, these green Government-Securities (G-Secs) were classified under the Statutory Liquidity Ratio (SLR), further constraining the financial institutions' lending capacity.
  • SGrBs typically offer lower interest rates compared to conventional G-Secs, leading to what is termed as a "greenium" - the amount foregone by a bank by investing in them. However, central banks and governments worldwide are encouraging financial institutions to embrace green investments to accelerate the transition to a sustainable future.
  • Climate finance experts believe that allowing FIIs to invest in green G-Secs would benefit India. They point out that FIIs are seeking to diversify their portfolio of green investments, especially in light of significant regulatory support in developed countries. Investing in India's green G-Secs presents an opportunity for them to do so.
  • FIIs may also be motivated to acquire green credentials, particularly when such investment opportunities are limited in their home markets. India's successful implementation of the Sovereign Green Bonds Framework in late 2022 has addressed concerns about greenwashing, further enhancing the attractiveness of these investments.
 

4. Understanding the Green Taxonomy Gap

 

  • In the 2022-23 Union Budget, Finance Minister Nirmala Sitharaman announced the government's decision to issue Sovereign Green Bonds (SGrBs) to expedite funding for various government projects, including initiatives such as offshore wind harnessing, grid-scale solar power production, and promoting the transition to battery-operated Electric Vehicles (EVs).
  • However, a critical gap emerged as the Reserve Bank of India (RBI) had not established a green taxonomy or a standardized method to evaluate the environmental or emissions credentials of investments. This gap raised concerns about potential greenwashing, wherein projects falsely claim environmentally friendly characteristics to secure funding.
  • To bridge this gap, the Finance Ministry unveiled India's inaugural SGrB Framework on November 9, 2022, outlining the types of projects eligible for funding through this category of Government-Securities (G-Secs).
  • These projects encompassed a range of initiatives, including investments in small-scale solar/wind/biomass/hydropower energy projects with integrated energy generation and storage, upgrades to public lighting systems (e.g., transitioning to LED lights), construction of low-carbon buildings, energy-efficiency retrofits for existing buildings, enhancements to public transportation infrastructure, subsidies to promote EV adoption, and the establishment of EV charging infrastructure.
  • Furthermore, the government sought validation from Norway-based validator Cicero to compare India's SGrB Framework with the green principles outlined by the International Capital Market Association (ICMA).
  • Cicero rated India's framework as a "green medium," highlighting its good governance practices.
  • The importance of identifying new green projects with credible audit trails and significant impact, particularly those areas that have received limited private capital, such as Distributed Renewable Energy and clean energy transition finance for Micro, Small, and Medium Enterprises (MSMEs).
  • Addressing this gap is crucial for effectively deploying the proceeds from SGrBs and advancing India's sustainable development goals.
 
5. The Way Forward
 
India can leverage Sovereign Green Bonds as a powerful tool to mobilize resources, foster international collaboration, and achieve its ambitious green goals. This integrated approach will pave the way for a sustainable and low-carbon future for the nation.
 
 
For Prelims: Sovereign Green Bonds, MSMEs, Climate Change, RBI, International Capital Market Association, Government-Securities
For Mains: 
1. Discuss the significance of Sovereign Green Bonds (SGrBs) in India's transition to a low-carbon economy. How can the issuance of SGrBs attract foreign investment and support the country's ambitious green goals?  (250 Words)
 
 
Previous Year Questions
 
1. Which of the following statements regarding the Green bonds is NOT true? (UPPSC RO/ARO 2020)
A. Green Bond investment is only for climate friendly projects
B. Green bonds were first introduced by European Investment Fund in 2007
C. Green Bonds are Financial Market Innovation
D. Green Bonds are fixed interest loan is short date maturities
 
2.  Indian Government Bond Yields are influenced by which of the following? (2021)
1. Actions of the United States Federal Reserve
2. Actions of the Reserve Bank of India
3. Inflation and short-term interest rates

Select the correct answer using the code given below.

(a) 1 and 2 only           (b) 2 only               (c) 3 only           (d) 1, 2 and 3

3. With reference to ‘IFC Masala Bonds’, sometimes seen in the news, which of the statements given below is/ are correct? (2016)

1. The International Finance Corporation, which offers these bonds, is an arm of the World Bank.
2. They are the rupee-denominated bonds and are a source of debt financing for the public and private sector.

Select the correct answer using the code given below:

(a) 1 only                 (b) 2 only                 (c) Both 1 and 2                 (d) Neither 1 nor 2

Answer: 1-D, 2-D, 3-C

 Source: The Hindu

 

PRODUCTION LINKED INCENTIVE (PLI) SCHEME

 
 
 
1. Context
 

About 12 textile companies are set to receive the first set of incentive payment under the productionlinked incentive ( PLI) scheme.“Around 40 companies have grounded investment.We had a gestation period till March 2024.

 
 
2. About Production-Linked Incentive (PLI) Scheme

 

The Production-Linked Incentive (PLI) scheme is an initiative by the Indian government to boost domestic manufacturing in specific sectors. It incentivizes companies, both domestic and foreign, to set up or expand production facilities in India by offering financial rewards based on incremental sales achieved over a set period.

  • The government announces a PLI scheme for a particular sector with specific targets for production and sales.
  • Companies apply for the scheme and submit their production plans.
  • If selected, companies receive a percentage of their incremental sales (over a base year) as an incentive.
  • The incentive amount varies depending on the sector and the level of incremental sales achieved.
  • The scheme typically runs for several years, providing companies with long-term financial support.

 

3. Sectors with Current PLI Schemes

 

  • Mobile phone manufacturing and specified electronic components have been successful in attracting major players like Apple and Samsung to set up production in India.
  • Large-scale electronics manufacturing to boost domestic production of TVs, laptops, and other electronics products.
  • High-efficiency solar PV modules to make India a global leader in solar energy production.
  • Automobiles and auto components incentivize the production of electric vehicles, hydrogen fuel cell vehicles, and advanced auto components.
  • Man-made fibre (MMF) apparel and textiles to boost domestic production of high-quality MMF textiles.
  • White goods (air conditioners, refrigerators, etc.) to make India a global hub for white goods manufacturing.

 

4. Sectors Likely to See PLI Schemes in the Future

 

  • The pharmaceuticals and medical devices sector is crucial for national health security and has the potential for significant growth.
  • Green hydrogen and ammonia fuels are essential for achieving climate goals and could benefit from PLI support.
  • Advanced manufacturing technologies include robotics, 3D printing, and artificial intelligence, which are crucial for future industries.
  • The food processing sector has vast potential for value creation and job creation, and PLI could help address inefficiencies.

 

5. Benefits of the PLI Scheme

 

  • PLI attracts investment and encourages companies to manufacture in India, reducing dependence on imports.
  • New manufacturing units and increased production lead to job creation in various sectors.
  • PLI attracts global companies with advanced technology, leading to knowledge transfer and skill development in India.
  • Increased domestic production can lead to higher exports and strengthen the Indian economy.
 

6. Challenges in the PLI Scheme

 

  • Companies need significant upfront investment to set up new production facilities, which can be a deterrent for some.
  • The application and approval process for PLI schemes can be lengthy and complex, discouraging some companies.
  • The government needs to ensure the long-term sustainability of PLI schemes to avoid dependence on subsidies.

 

7. The Way Forward

 

The PLI scheme is a promising initiative with the potential to transform India's manufacturing landscape. By addressing the challenges and continuously improving its design, the government can further incentivize domestic production and boost India's economic growth.

 
For Prelims: Production Linked Incentive scheme,  industrial policy
For Mains: 
1. Discuss the role of the government in promoting domestic manufacturing. Should the focus be on incentives like the Production Linked Incentive scheme or on creating a conducive business environment? (250 Words)
 
 
 
Previous Year Questions
 

1. Consider, the following statements : (UPSC 2023)

Statement-I : India accounts for 3.2% of global export of goods.

Statement-II : Many local companies and some foreign companies operating in India have taken advantage of India's ‘Production-linked Incentive’ scheme.

Which one of the following is correct in respect of the above statements?

(a) Both Statement-I and Statement-II are correct and Statement-II is the correct explanation for Statement-I

(b) Both Statement-I and Statement-II are correct and Statement-II is not the correct explanation for Statement-I

(c) Statement-I is correct but Statement-II is incorrect

(d) Statement-I is incorrect but Statement-II is correct

Answer: D

 

Source: The Indian Express

CENTRAL WATER COMMISSION

 

1. Context 

As the southwest monsoon prepares to leave the mainland, the good showers over the last few months have ensured that water levels in most of the 155 reservoirs across the country that are monitored by the Central Water Commission ( CWC) are better than normal levels.However, water levels in the reservoirs of North India particularly in the states of Himachal Pradesh and Punjab, along with Bihar and Nagaland are lower than their normal levels.

2. About Central Water Commission

  • CWC is an attached office of the Ministry of Jai Shakti Department of Water Resources, River Development and Ganga Rejuvenation. 
The Commission is entrusted with the general responsibilities of initiating, coordinating and furthering in consultation with the State Governments concerned, schemes for control, conservation and utilization of water resources throughout the country for purpose of Flood Control, Irrigation, Navigation, Drinking Water Supply and Water Power Development.
  • It undertakes the investigations, construction and execution of any such schemes as required.
  • It is headed by a chairman, with the status of Ex Officio Secretary to the Government of India. Its headquarters at New Delhi.
  • The Work of the Commission is divided among 3 wings namely, the Designs and Research (D & R) Wing, River Management (RM) Wing and Water Planning and Projects (WP & P) Wing.
  • A separate Human Resources Management Unit headed by Chief Engineer deals with Human Resources Management or Development, Financial Management, Training and Administrative matters of the CWC.
  • National Water Academy located in Pune is responsible for the training of Central and State in-service engineers and it functions directly under the guidance of the Chairman.

3. Dam Rehabilitation and Improvement Project (DRIP) Project

  • The Project was launched in 2012 by the CWC with financial aid from the World Bank.
  • It is an externally-aided project with 80 per cent of the total project provided by the World Bank as loan/ credit and the remaining 20 per cent being borne by the states/ Central government.
  • The total cost of the Project was Rs 2100 crores and the amount allocated for Phase II and III is Rs. 10, 211 crores.
  • The project was launched in 2020, with DRIP Phase II and III, with similar objectives on a larger scale.
  • There were 225 dams which were covered for rehabilitation and improvement in terms of safety measures.

3.1. Objectives

  • To improve the safety and performance of selected existing dams and associated appurtenances in a sustainable manner.
  • To strengthen the dam safety institutional setup in participating states as well as at the central level.
  • To explore the alternative incidental means at a few selected dams to generate the incidental revenue for sustainable operation and maintenance of dams.

3.2. Components

  • Rehabilitation of selected dams and their appurtenances 
  • Institutional Strengthening 
  • Project Management
  • The formation of the International Centre of Excellence for Dams (ICED) will empower 'Make in India' in dam safety, plus augment advanced research and developing technologies and application products.
  • The ICED is being set up at 109 Crore, being borne by the Department of Water Resources, Ganga Rejuvenation & River Development, Ministry of Jal Shakti, Government of India as a non-recurring grant in six tranches.
  • ICED, Roorkee will provide specialized technical support in investigations, modelling, research and innovations, and technical support services to the Indian and overseas dam owners.
  • IITR will endeavour to reach a level of self-sufficiency within ten (10) years by generating income streams through the knowledge and capabilities developed on dam safety & rehabilitation in general and in the core areas of reservoir sedimentation and seismic hazard mapping and analysis in particular.
  • The Centre will work for agreed dam safety areas to support and provide solutions to various emerging challenges faced in dam safety through scientific research and the latest technology and digital innovations.
  • IITR will endeavour to reach a level of self-sufficiency within ten (10) years by generating income streams through the knowledge and capabilities developed on dam safety & rehabilitation in general and in the core areas of reservoir sedimentation and seismic hazard mapping and analysis in particular.

For Prelims & Mains

For Prelims: DRIP Project, Dams,  Central Water Commission, Central Water Academy, Ministry of Jai Shakti Department of Water Resources, River Development and Ganga Rejuvenation, International Centre of Excellence for Dams. 
For Mains:
1. What is Dam Rehabilitation and Improvement Project and discuss how it will improve the irrigation system in India. (250 Words)
 
Source: PIB
 

INDIA-US PARTNERSHIP

 
 
1. Context
On the sidelines of the Quad leaders’ summit, Prime Minister Narendra Modi held a meeting with United States President Joe Biden on September 21. This might well have been the final tête-à-tête between the two world leaders before Biden leaves the White House in January 2025
 
2.India-US Relationship
  • India and the United States has been multifaceted and has evolved over the years. It covers various areas such as strategic, economic, technological, and cultural cooperation.
  • India and the United States have developed a strategic partnership, marked by regular high-level diplomatic engagements and cooperation on regional and global issues. Both countries share common values such as democracy and a commitment to a rules-based international order
  • Defense and security ties between India and the U.S. have strengthened. Both countries participate in joint military exercises, and there is ongoing collaboration in defense technology and procurement. The Logistics Exchange Memorandum of Agreement (LEMOA) and the Communications Compatibility and Security Agreement (COMCASA) are examples of agreements aimed at enhancing defense cooperation.
  • Economic ties have expanded, with both countries being significant trade partners. Bilateral trade has increased, and efforts have been made to address trade imbalances. The U.S. has been a major source of foreign direct investment (FDI) in India, and both sides have expressed interest in further deepening economic collaboration.
3. Key Elements of Partnerships of India-US

3.1.Technology partnership

  • Micron Technology, in collaboration with the backing of the India Semiconductor Mission, plans to allocate over $800 million for the establishment of a new semiconductor assembly and test facility in India, contributing to a total investment of $2.75 billion. Additionally, Applied Materials is set to construct a Semiconductor Centre for Commercialization and Innovation in India, aimed at enhancing the diversification of the semiconductor supply chain between the two countries. Simultaneously, Lam Research intends to facilitate the training of 60,000 Indian engineers through its "Semiverse Solution," aligning with India's objectives for accelerated semiconductor education and workforce development
  • India has recently joined the Minerals Security Partnership (MSP) led by the United States, aimed at expediting the establishment of robust and sustainable global supply chains for critical energy minerals. Commencing in June 2022, MSP already includes 12 other partner nations and the European Union. As part of this collaboration, Epsilon Carbon Limited from India is set to inject $650 million into the creation of a greenfield facility for electric vehicle battery components, marking the most substantial Indian investment to date in the U.S. electric vehicle battery sector.
  • India and the United States have initiated collaborative efforts through public-private Joint Task Forces dedicated to the advancement and implementation of Open RAN systems, as well as the progress of advanced research and development in telecommunications. The joint leadership of India's Bharat 6G and the U.S. Next G Alliance in this public-private research endeavour is aimed at diminishing expenses, enhancing security, and fortifying the resilience of telecommunication networks.
  • India has officially endorsed the Artemis Accords, aligning itself with 26 other nations dedicated to fostering peaceful, sustainable, and transparent collaboration for the exploration of celestial bodies such as the Moon, Mars, and beyond. In a significant development, NASA is set to offer advanced training to astronauts from the Indian Space Research Organization (ISRO), with the objective of initiating a joint mission to the International Space Station in 2024. Furthermore, NASA and ISRO are actively working on establishing a strategic framework for cooperation in human spaceflight, with plans to finalize the agreement by the conclusion of 2023.
  • A collaborative effort has been instituted by both nations through the creation of a Joint Indo-US Quantum Coordination Mechanism. This mechanism is designed to streamline cooperative research endeavors involving the public and private sectors in both countries. Additionally, they have formalized an implementing arrangement to bolster joint research initiatives focusing on quantum technologies, Artificial Intelligence (AI), and advanced wireless technologies.
  • The National Science Foundation of the United States has disclosed 35 collaborative research projects in conjunction with India's Department of Science and Technology. Additionally, a fresh cooperative agreement has been formalized between the U.S. National Science Foundation and India's Ministry of Electronics and Information Technology, specifically targeting emerging technologies
  • Sterlite Technologies Limited of India has committed a $100 million investment towards establishing a manufacturing facility for optical fiber cables in close proximity to Columbia, South Carolina. This initiative is expected to support annual optical fiber exports from India amounting to $150 million
3.2.Defence Partnership
  • The Joint Statement expressed approval for the innovative proposal put forth by General Electric to collaboratively manufacture the F414 jet engine in India. General Electric and Hindustan Aeronautics Limited (HAL) have formalized a Memorandum of Understanding (MoU), and a manufacturing license agreement has been presented for Congressional Notification. This unprecedented initiative, marking the first time F414 engines will be produced in India, is poised to facilitate a more extensive transfer of U.S. jet engine technology than previously experienced
  • India has plans to acquire armed MQ-9B SeaGuardian Unmanned Aerial Vehicles (UAVs), aiming to enhance the country's intelligence, surveillance, and reconnaissance capabilities
  • The U.S. Navy has finalized a Master Ship Repair Agreement (MSRA) with Larsen and Toubro Shipyard in Kattupalli (Chennai) and is in the process of completing agreements with Mazagon Dock Limited (Mumbai) and Goa Shipyard (Goa). These arrangements will permit U.S. Navy vessels to undergo maintenance and repair at Indian shipyards during their voyages.
  • The inauguration of the India-US Defence Acceleration Ecosystem (INDUS-X) took place on June 21, 2023. This network involves participants from universities, incubators, corporations, think tanks, and private investors. The program is designed to foster collaborative innovation in defense technologies and expedite the integration of India's private sector defense industry with its U.S. counterpart
3.3. Cooperation in the Indo-Pacific
 

Titled 'Taking the Lead on the Global Platform,' the Joint Statement highlights several strategic actions undertaken by the two nations.

  • Indo-Pacific and Indian Ocean: The United States will become a participant in the Indo-Pacific Oceans Initiative, a regional effort initiated by Prime Minister Modi in 2015 to ensure a secure, stable maritime environment and advocate for its conservation and sustainable utilization. India will maintain its role as an observer in the Partners in the Blue Pacific. The U.S. and India plan to conduct an Indian Ocean Dialogue involving experts and stakeholders from the broader Indian Ocean region to enhance regional coordination.
3.4.Sustainable development
  • India and the United States will persist in their collaborative efforts to meet their individual climate and energy objectives. The United States appreciates India's commitment to jointly spearhead the Hydrogen Breakthrough Agenda, a multinational initiative aimed at making affordable renewable and low-carbon hydrogen accessible worldwide by 2030
  • The Joint Statement underlines the mutual dedication of both nations to establishing inventive investment frameworks. These frameworks aim to reduce the capital costs and draw substantial international private financing for projects related to renewable energy, battery storage, and emerging green technologies in India. Additionally, the statement acknowledges efforts to decarbonize the transportation sector and highlights India's establishment of the Global Biofuels Alliance, in which the U.S. is a founding member
3.5.Initiatives on health
  • The U.S. National Cancer Institute is set to encourage cooperation between American and Indian scientists through two recently awarded grants. These grants aim to create an Artificial Intelligence (AI)-enhanced digital pathology platform for purposes such as cancer diagnosis, prognosis, and forecasting therapeutic outcomes. Additionally, the grants will support the development of AI-driven automated radiotherapy treatment specifically for cervix, head, and neck cancers.
  • The U.S. National Institute of Diabetes and Digestive and Kidney Diseases is poised to enter into an agreement with the Indian Council of Medical Research. This collaboration aims to advance research in the realms of basic, clinical, and translational studies on diabetes. Additionally, the United States and India are set to convene a US-India Cancer Dialogue, facilitated by President Biden's Cancer Moonshot initiative. This dialogue will serve as a platform for experts from both countries to identify specific areas of collaboration, accelerating the pace of progress in the fight against cancer.
3.6.Fighting terror and drugs
  • The Joint Statement reaffirmed the commitment of the United States and India to jointly combat global terrorism, condemning terrorism and violent extremism in all its forms. President Biden and Prime Minister Modi reiterated the need for concerted action against UN-listed terrorist groups, including al-Qa’ida, ISIS/Daesh, Lashkar e-Tayyeba (LeT), Jaish-e-Mohammad (JeM), and Hizb-ul-Mujhahideen.
  • They strongly denounced cross-border terrorism and the use of terrorist proxies. The leaders called on Pakistan to take immediate action to prevent any territory under its control from being used for launching terrorist attacks. Additionally, they urged for the perpetrators of the 26/11 Mumbai and Pathankot attacks to be brought to justice.

4. Way forward

India and the U.S. often collaborate on various global and regional challenges, including United Nations initiatives, counterterrorism efforts, and regional stability.
 
Source: Indianexpress
 

FOREIGN DIRECT INVESTMENT (FDI)

 
 
1. Context
 The debate on Chinese foreign direct investment (FDI) into India oscillates between economic benefits and security risks. But, a key fundamental question beyond that remains unanswered.
 
2. FDI in India
  • India's net foreign direct investment (FDI) inflows experienced a decline, decreasing by nearly 31% to $25.5 billion during the first 10 months of the 2023-24 fiscal year. The Finance Ministry attributed this decline to a broader trend of slowing investments in developing countries, while expressing optimism for a potential increase in investments in the current calendar year.
  • Although global FDI flows overall saw a 3% rise to approximately $1.4 trillion in 2023, economic uncertainty and elevated interest rates impacted global investment, resulting in a 9% decrease in FDI flows to developing nations, as outlined in the Ministry's February assessment of economic performance.
  • Reflecting the global trend of reduced FDI flows to developing countries, gross FDI inflows to India also experienced a slight decline, from $61.7 billion to $59.5 billion during the period from April 2023 to January 2024. In terms of net inflows, the corresponding figures were $25.5 billion versus $36.8 billion. The decrease in net inflows was primarily attributed to an increase in repatriation, while the decline in gross inflows was minimal.
  • While a modest uptick in global FDI flows is anticipated for the current calendar year, attributed to a decrease in inflation and borrowing costs in major markets that could stabilize financing conditions for international investment, significant risks persist, according to the Ministry. These risks include geopolitical tensions, elevated debt levels in numerous countries, and concerns regarding further fragmentation of the global economy
 
3. Foreign Direct Investment (FDI)
Foreign Direct Investment (FDI) refers to the investment made by individuals, businesses, or governments from one country (the home country) into another country (the host country) with the objective of establishing a lasting interest or significant degree of influence in the foreign business or enterprise
Key Aspects:
  • FDI involves the transfer of funds and resources from one country to another. This capital inflow can help stimulate economic growth in the host country by providing funds for investment in infrastructure, technology, and other areas.
  • FDI often leads to the creation of jobs in the host country. When foreign companies establish subsidiaries or invest in existing businesses, they typically hire local employees, which can help reduce unemployment and improve living standards
  • Foreign investors often bring advanced technologies, processes, and management practices to the host country. This technology transfer can enhance the host country's productivity, competitiveness, and industrial capabilities
  • FDI can provide access to new markets for both the host country and the investing company. Foreign investors can tap into the host country's consumer base, while the host country gains access to the investing company's global distribution networks.
  • FDI can contribute to overall economic development in the host country by promoting industrialization, improving infrastructure, and fostering innovation and entrepreneurship.
4.FDI Routes in India
India has several routes through which Foreign Direct Investment (FDI) can enter the country. These routes are regulated by the Reserve Bank of India (RBI) and the Department for Promotion of Industry and Internal Trade (DPIIT), and they define the conditions, limits, and sectors in which FDI is allowed
  1. Automatic Route: Under the automatic route, FDI is allowed without the need for prior approval from the RBI or the government. Investors only need to notify the RBI within a specified time frame after the investment is made. This route is available for most sectors, except those that are prohibited or require government approval.

  2. Government Route: In sectors or activities that are not covered under the automatic route, FDI requires government approval. Investors must apply for approval through the Foreign Investment Facilitation Portal (FIFP) or the Foreign Investment Promotion Board (FIPB), depending on the sector.

4.1. Examples
  • Under the automatic route, FDI of up to 100% is allowed for manufacturing of automobiles and components.
  • For the manufacturing of electric vehicles (EVs), 100% FDI is allowed under the automatic route.
  • In single-brand retail trading, 100% FDI is allowed, with up to 49% allowed under the automatic route. Beyond 49%, government approval is required.
  • Multi-brand retail trading (supermarkets and department stores) with FDI is permitted in some states, subject to certain conditions and restrictions. The FDI limit is typically capped at 51%.
  • FDI in the insurance sector is allowed up to 74%, with up to 49% under the automatic route. Beyond 49%, government approval is needed
  • In the telecom sector, 100% FDI is allowed, with up to 49% under the automatic route. Beyond 49%, government approval is required
  • In the defense sector, FDI up to 74% is allowed under the automatic route, with government approval required for investments beyond 49%
  • In most segments of the media and broadcasting sector, including print and digital media, 100% FDI is allowed, with up to 49% under the automatic route
4.2.Sectors where FDI Prohibited
  • FDI is prohibited in the atomic energy sector, which includes activities related to the production of atomic energy and nuclear power generation.
  • FDI is generally prohibited in the gambling and betting industry, which includes casinos and online betting platforms
  • FDI is not allowed in the lottery business, except for state-run lotteries
  • FDI is prohibited in chit funds, which are traditional Indian savings and credit schemes.
  •  Nidhi companies are non-banking finance companies (NBFCs) that facilitate mutual benefit funds. FDI is typically not permitted in these entities
  • While FDI is allowed in single-brand retail trading, it is generally prohibited in multi-brand retail trading of agricultural products. Some states have allowed it under specific conditions, but this remains a highly regulated area.
  • FDI is not allowed in the trading of transferable development rights (TDRs) pertaining to the construction of real estate
5. Foreign Portfolio Investors (FPIs)
Foreign Portfolio Investors (FPIs) refer to foreign individuals, institutions, or funds that invest in financial assets in a country, such as stocks, bonds, mutual funds, and other securities. FPIs are distinct from Foreign Direct Investors (FDIs), who typically make long-term investments in companies and assets to establish a lasting interest
Key Aspects:
  • FPIs invest in a country's financial markets, primarily by buying and selling securities traded on stock exchanges and fixed-income instruments like bonds and government securities
  • FPIs often seek to diversify their investment portfolios by spreading their investments across different asset classes, sectors, and countries. This diversification helps manage risk and enhance returns
  • FPIs have the flexibility to buy and sell securities in the secondary market, providing liquidity to the market and contributing to price discovery
  • FPIs typically have a shorter investment horizon compared to Foreign Direct Investors (FDIs). They may engage in short-term trading or hold securities for a few months to a few years.
  • FPIs are subject to regulatory frameworks and restrictions in the countries where they invest. These regulations are designed to ensure that foreign investments do not pose undue risks to the local financial markets and economy.
6.Foreign Portfolio vs. Foreign Direct Investment
 
FPI (Foreign Portfolio Investment) FDI (Foreign Direct Investment)
FPI involves the purchase of financial assets such as stocks, bonds, mutual funds, and other securities in a foreign country. These investments are typically made with the intention of earning returns on capital and do not result in significant control or ownership of the underlying businesses FDI entails making an investment in a foreign country with the primary objective of establishing a lasting interest and significant control or influence over a business enterprise or physical assets. FDI often involves the acquisition of a substantial ownership stake (typically at least 10%) in a company or the establishment of new business operations.
FPI is generally characterized by a shorter investment horizon. Investors in FPI may engage in trading and portfolio rebalancing activities, and their investments are often more liquid. The focus is on earning capital gains and income from investments. FDI is characterized by a longer-term commitment. Investors in FDI intend to engage in the day-to-day management or decision-making of the business, contribute to its growth and development, and generate profits over an extended period.
FPI investors typically have little to no influence or control over the companies in which they invest. They are passive investors who participate in the financial markets and rely on market dynamics to drive returns. FDI investors actively participate in the management and decision-making of the businesses they invest in. They often seek to exercise control over company operations and strategy, which may include appointing board members or key executives.
FPI investments are often made through financial instruments like stocks, bonds, and securities. Investors may use instruments like mutual funds or exchange-traded funds (ETFs) to gain exposure to foreign markets FDI investments involve a direct equity stake in a company, either through share acquisition or the establishment of a subsidiary or branch in the host country. FDI can also involve the purchase of real assets such as land, factories, or infrastructure
FPI can provide short-term capital inflows, but it may be more susceptible to market volatility and sudden capital outflows. It may not have as direct an impact on job creation and economic development as FDI. FDI often contributes to long-term economic development by creating jobs, stimulating infrastructure development, transferring technology and expertise, and enhancing the competitiveness of local industries
FPI investments are subject to regulations that vary by country and may include foreign ownership limits, reporting requirements, and tax considerations. FDI is subject to regulations that can be more stringent and may involve government approval, sector-specific conditions, and investment protection measures
 
 
 
 
For Prelims: Economic and Social Development-Sustainable Development, Poverty, Inclusion, Demographics, Social Sector Initiatives, etc
For Mains: General Studies III: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment
 
 
Previous Year Questions
 
1. Both Foreign Direct Investments (FDI) and Foreign Institutional Investor (FII) are related to investment in a country. (UPSC CSE 2011)
 
Which one of the following statements best represents an important difference between the two?
A.FII helps bring better management skills and technology, while FDI only brings in capital
B.FII helps in increasing capital availability in general, while FDI only targets specific sectors C.FDI flows only into the secondary markets, while FII targets primary market
D.FII is considered to the more stable than FDI
 
Answer (B)
 
Source: indianexpress
 

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