Tag: ‘India’s indebtedness levels

UPSC DAILY CURRENT AFFAIRS (23RD DECEMBER, 2023) Coastal Shipping Policy Syllabus:GS3/Economy Context The Union Minister of Ports, Shipping and Waterways (MoPSW) chaired the meeting on the ‘Coastal Shipping Policy’. What is Coastal Shipping? Coastal shipping refers to the transportation of goods and passengers between ports or harbors along a country’s coastline. This mode of shipping is distinct from deep-sea or international shipping, which involves the movement of cargo and passengers across oceans and between different countries. Potential of Coastal Shipping Geographical Advantage: India has 12 major and more than 200 non-major ports situated along its 7500 km long coastline and a vast network of navigable waterways. Short-Distance Travel: Coastal shipping routes typically cover relatively short distances along the coastlines of a country. This makes it a cost-effective and efficient mode of transportation for goods and people between nearby ports. Decongestion of Road and Rail Networks: It can help alleviate congestion on India’s already burdened road and rail networks. This can lead to improved efficiency and reduced travel times for goods transported by these modes. Environmental Benefits: It can help reduce carbon emissions and contribute to India’s efforts to achieve sustainable and eco-friendly logistics solutions. Connectivity to Remote Areas: India has an extensive coastline, and coastal shipping can facilitate connectivity to remote and underserved areas, promoting economic development in these regions. Promotion of Port Infrastructure: The development of coastal shipping is closely linked to the growth of port infrastructure. Increased utilization of coastal shipping can drive investments in port facilities, leading to improved efficiency and capacity at Indian ports. Coastal Shipping: Cargo Transport In the year 2014-15, Indian ports handled about 74.97 million Tonnes per Annum (MTPA) of coastal cargo -Increased to 151 MTPA (increased by 104%) in 2022-23. National Waterways handled 126.15 MMT cargo in 2022-23 while it was 6.83 MMT in 2013-14 (increased by 1700%). Commodity Wise Share: Port of Loading (POL) Products (32.3%), Thermal Coal (30.6%), Iron Ore (11%), Iron Pellets (7.6%), Cement/Clinker (1.5%) and Others (17.1%). Challenges issues in the infrastructure and procedures at port and port-centric areas underdevelopment of small ports; lack of a collaborative culture among the various service providers involved in the logistics supply chain. Government Steps GST regulation: The government has also reduced GST on bunker fuels used in Indian Flag Vessels from 18% to 5%. Sagarmala Programme: It was launched by the Ministry of Shipping, to promote port-led development and harness the potential of India’s coastline and waterways. It focuses on developing infrastructure, enhancing efficiency, and integrating the maritime sector with other modes of transportation. Priority berthing policy for coastal vessels has been notified to reduce turnaround time for coastal vessels and improve their utilization. Green channel clearance introduced for faster evacuation of coastal cargo at ports. Allowed reimbursement of freight subsidy on primary movement of subsidized urea and P&K fertilizers by coastal shipping or inland water transportation. Development of National Waterways: The government has been working on the development of National Waterways to enhance inland and coastal water transportation. This includes the identification and development of waterways for cargo and passenger movement. Cabotage Relaxation: Cabotage laws regulate the transportation of goods between domestic ports. The government has periodically relaxed cabotage regulations to allow foreign-flagged vessels to carry coastal cargo, which can help improve the availability of vessels for coastal shipping. Way Ahead Coastal shipping is an important component of a nation’s maritime transport system and plays a crucial role in domestic trade and connectivity. To harness the full potential of it, development of agglomeration centers, silo infrastructure, dedicated warehousing facilities and improvement in end-to-end logistics supply chain are the focus areas of the ministry for promoting coastal shipping further. Drug Abuse in India Syllabus: GS1/Society In Context The rampant abuse of pharmaceutical drugs, known locally as intoxicating tablets, has opened a new front in Punjab’s fight against narcotics addiction. About Rampant Abuse: Almost 25% of the FIRs filed by Punjab Police under the Narcotic Drugs and Psychotropic Substances Act (NDPS) between April, 2022 and February, 2023, are related to the confiscation of such pills from individuals. Hubs: The high number of pill-related FIRs are from the areas located far from the border with Pakistan, but close to pharmaceutical hubs like Baddi and Paonta Sahib in Himachal Pradesh, and Saharanpur in Uttar Pradesh. This suggests a direct link between poverty and drug peddling Drug Abuse in India According to the Ministry of Social Justice and Empowerment’s report on the “National Survey on Extent and Pattern of Substance Use in India” (2019), the magnitude of substance use is: 14.6% individuals between the age of 10 and 75 years are current users of alcohol, and out of them, 5.2% are alcohol dependents. About 2.8% of individuals are cannabis users. Overall opioid users are nearly 2.06%. 1.08% are current users of sedatives (non-medical use). 1.7% of children and adolescents are inhalant users as compared to adults of 0.58%. As per the latest report of the National Crime Records Bureau the Punjab topped the nationwide list in cases pertaining to possession of drugs for trafficking in 2022. Drugs and Types– From traditional plant-based drugs such as cannabis, cocaine, and heroin to synthetic drugs such as tramadol, consumption of narcotic substances in India has increased manifold in recent years.– In terms of users, India’s illicit drug markets are mostly dominated by cannabis and opioids. Impact of Drug Abuse Health Effects: These may include cardiovascular issues, respiratory problems, liver damage, and infectious diseases (such as HIV and hepatitis, particularly for intravenous drug users). Drug abuse is often linked to mental health disorders, including anxiety, depression, paranoia, hallucinations, and cognitive impairments. Social and Interpersonal Consequences: The behavioral changes and emotional instability associated with drug use can lead to conflict and alienation. Individuals engaged in drug abuse may withdraw from social activities, leading to isolation and a diminished support system. Workplace Productivity: Substance abuse disorders may contribute to unemployment or difficulty maintaining steady employment. Crime: Drug abuse is often associated with criminal activities such as drug trafficking, theft, and violence. This can contribute to an increase in crime rates in communities. Public Health Concerns: The spread of diseases, such as HIV and hepatitis, through shared needles among intravenous drug users, can pose public health challenges. Child Neglect and Abuse: Parents with substance abuse problems may neglect or abuse their children, leading to long-term psychological and emotional consequences for the children. Steps Taken by the Government of India to Curb Drug Abuse National Policy on Narcotic Drugs and Psychotropic Substances: The Government of India brought out a National Policy in 2012 to serve as a guide to various Ministries/Departments, State Governments, NGOs, etc. National Action Plan for Drug Demand Reduction (NAPDDR): The Ministry of Social Justice and Empowerment has prepared NAPDDR for 2018-2023 so as to focus on preventive education, awareness generation, identification, counselling, treatment and rehabilitation of drug dependent persons and training and capacity building. International Conventions: India is a signatory to the three UN Conventions namely, Single Convention on Narcotic Drugs, 1961, Convention on Psychotropic Substances, 1971 and Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, 1988. NDPS Act: The Government of India has enacted the NDPS Act in the year 1985 to make stringent provisions for the control and regulation of operations relating to narcotic drugs and psychotropic substances. Scheme for Prevention of Alcoholism: The Ministry of Social Justice and Empowerment has been implementing a Central Sector Scheme of Assistance for Prevention of Alcoholism and Substance (Drugs) Abuse since 1985-86. Treatment and Rehabilitation Centers: The government has established treatment and rehabilitation centers across the country to help individuals struggling with drug addiction. International Cooperation: India collaborates with international organizations and other countries to address the transnational nature of drug trafficking. Border Security Measures: Strengthening border security is crucial to curb the inflow of illegal drugs into the country. This includes increased vigilance at border crossings and cooperation with neighboring countries. Conclusion and Way Forward The need to combat drug menace must be a concern for everyone who wants to have a better society. There is a need for setting up of a special authority with statutory powers to curb the use of drugs, strengthening coordination between various departments. Leaving no one behind requires greater investment in evidence-based prevention, as well as treatment and other services for drug use disorders, HIV, hepatitis C and other infections. We need international cooperation to increase access to controlled drugs for medical purposes, while preventing diversion and abuse, and to strengthen law enforcement action to dismantle the transnational organised crime networks. Source: IE Paat-Mitro Application for Jute Farmers Syllabus:GS3/ Economy Context The Ministry of Textiles launched “Paat-Mitro” – a mobile application during ‘Jute Symposium’. About Paat-Mitro application is developed by The Jute Corporation of India Limited (JCI). Jute Symposium: It was organized to create awareness and popularize Jute based technical textiles with special emphasis on Jute Geotextiles. Features The application is launched to provide information about MSP and agronomy to jute farmers and is available in 6 languages. In the app there are Jute Gradation Parameters, Farmer-centric schemes like ‘Jute-ICARE’, weather forecasts, JCI’s Purchase Centers’ locations, Procurement Policies, and Chatbot are also made available. Farmers will also be able to track the status of their payments for the raw jute sold to JCI under MSP Operation. Jute Production In India India is the largest producer of jute followed by Bangladesh and China. However, in terms of acreage and trade, Bangladesh takes the lead accounting for three-fourth of the global jute exports in comparison to India’s 7%. Jute sector provides direct employment to 3.5 lakh workers in the country and supports the livelihood of around 40 lakh farm families. West Bengal, Bihar and Assam account for almost 99% of India’s total production. Conditions Required for Jute Production– Temperature: A mean maximum and minimum temperature of 34oC and 15oC and a mean relative humidity of 65% are required. – Rainfall: Around 150-250 cm.– Soil: Jute can be raised on all kinds of soils from clay to sandy loam, but loamy alluvial soils are best suited. Challenges for Jute Industry in India Competition from Synthetic Fibers: Jute faces stiff competition from synthetic fibers like polypropylene and polyester, which are often considered more versatile and cost-effective. Lack of Innovation and Product Diversification: The industry is facing challenges in terms of limited product innovation and diversification. Expanding the range of jute products and finding new applications can help capture a broader market. Poor Quality: Under retting, jute bundles are kept under water at a depth of about 30 cm. This process gives the fiber its shine, color, and strength. It should ideally be done in slow moving, clean water bodies like rivers. But Indian farmers do not have access to such resources. Problems of Jute mills in India: Jute mills are marred by issues of Machinery modernisation, Mismanagement, Labour shortage, and Unrest and dependence on the government. Amongst the functioning mills, only 8-10 are in good financial health and can survive seasonal losses. The business of another 20 mills is just average. The rest of the mills are financially unsound. Government Steps for Jute Production Continuation of Jute Packaging Material (Compulsory Use in Packing Commodities) Act,1987. The Government has kept reservations 100% for food grains and 20% for sugar, to be packed in jute packaging material. The Government has approved an Umbrella scheme namely National Jute Development Program (NJDP) with a total outlay of Rs 485.58 crore for implementation during 2021-22 to 2025-26 for overall development and promotion of Jute Sector. NJDP covers following schemes: Improved Cultivation and Advanced Retting Exercise (Jute ICARE): To introduce a package of scientific methods of jute cultivation and retting exercises for improving fiber quality and productivity and reducing the cost of jute production and increasing farmers’ income. Jute Resource cum Production Centre (JRCPC): To spread jute diversification programmes by providing training to new artisans and WSHGs for sustained employment for production of Jute Diversified Products (JDPs). Jute Raw Material Bank (JRMB): To supply jute raw material to jute artisans, MSMEs for production of JDPs at Mill Gate price. Jute Retail Outlets (JRO) Scheme: To facilitate existing and new artisans / entrepreneurs for promotion and sale of JDPs through Retail Outlets / Showrooms. Jute Design Resource Centre (JDRC): For designing and development of market worthy innovative jute diversified products and helping existing and new JDP manufacturers and exporters. Product Diversification (R&D) Studies: To explore Research & Development in Textile and Non Textile Applications. Production Linked Incentive (PLI) Scheme: To support Jute Mills and MSME JDP units for manufacturing and exporting JDPs and making them cost competitive in the international markets. Capital Subsidy for Acquisition of Plant & Machinery (CSAPM): For manufacturing (JDPs) and to facilitate modernization / upgradation of the existing Jute mills and MSME JDP Units. Market Development Promotion activities (Domestic & Exports): To support the JDP units for promotion and sale of JDPs, in the Domestic market and to register jute exporters to boost export of jute goods. Development of Jute Mark Logo for Certification of Quality Jute Diversified products and Launching publicity campaign to popularize jute. Scholarship Scheme for the girl children of the workers of jute mills, JDP- MSMEs: To support girl children of the workers of Jute Mills/MSME-JDP Units in the form of incentives. Jute Corporation of India Limited (JCI)– JCI was incorporated by the Government Of India in 1971 as a price support agency with the mandate for the procurement of raw jute from the growers at the minimum Support price (MSP).– The objective is not profit making but a social cause to protect the interest of about 4.00 million families engaged in farming of jute. Inflation in India Syllabus: GS3/Economy Context Recently, RBI in an article discussed the Supply and Demand side factors which primarily influenced inflation in India. What is Inflation? Inflation is a rise in prices, which can be translated as the decline of purchasing power over time. The rate at which purchasing power drops can be reflected in the average price increase of a basket of selected goods and services over some period of time. The rise in prices, which is often expressed as a percentage, means that a unit of currency effectively buys less than it did in prior periods. Inflation can be Cost-Push Inflation or Demand-Pull Inflation. Cost-Push Inflation Cost-push inflation means prices have been “pushed up” by increases in the costs of any of the four factors of production—labor, capital, land, or entrepreneurship—when companies are already running at full production capacity. Aggregate supply is the total volume of goods and services produced by an economy at a given price level. When the aggregate supply of goods and services decreases because of an increase in production costs, it results in cost-push inflation. Example: Categories such as vegetables, oils and fats, milk, eggs, pulses, and sugar frequently experience supply-side constraints. Demand-Pull Inflation Demand-pull inflation occurs when there is an increase in aggregate demand, categorized by the four sections of the macroeconomy: households, businesses, governments, and foreign buyers. Increase in government spending and depreciation of local exchange rates can increase aggregate demand, thus the prices are raised. Depreciation of local exchange rate, raises the price of imports and reduces the price of exports. As a result, the purchasing of imports decreases while the buying of exports by foreigners increases. This raises the overall level of aggregate demand. Items like non-alcoholic beverages, personal care products, and health-related goods are mainly affected by demand-side factors. Effects of a rise in the inflation rate Economic growth: Inflation could lead to economic growth as it can be a sign of rising demand. Increased unemployment: Inflation could further lead to an increase in costs due to workers’ demand to increase wages to meet inflation. This might increase unemployment as companies will have to lay off workers to keep up with the costs. Reduced Purchasing Power: Consumers can buy fewer goods and services with the same amount of money, leading to a decrease in their standard of living. Impact on Savings: Inflation erodes the real value of money over time. People holding onto cash or low-interest savings accounts may see the purchasing power of their savings decrease. Weak Currency: Inflation weakens the currency of the country. The falling value of currency makes imports expensive and burdens the forex of the country. Methods to control inflation? Monetary Policy Tools: Adjusting interest rates and Open market operations are used to control inflation. Interest Rates: Central banks use interest rates as a tool to control inflation. By raising interest rates, they aim to reduce borrowing and spending, which can help cool down the economy and prevent excessive inflation. Open Market Operations: Central banks can also influence inflation by buying or selling government securities in the open market. Selling securities can reduce the money supply, while buying them can increase it. Fiscal Policy: It includes reduced government spending and adjusting tax policies. Higher taxes can reduce disposable income and spending, helping to cool down the economy. Supply-Side Policies: It includes productivity improvements and labour market reforms to control inflation. Exchange Rate Policies: A stable exchange rate can help control inflation by influencing the prices of imported goods. A stronger currency makes imports cheaper, helping to curb inflation. Inflation Targeting: Central banks set a specific inflation target and adjust monetary policy to achieve and maintain that target. This provides transparency and helps anchor inflation expectations. Macroprudential Policies: These policies focus on addressing risks in the financial system that may contribute to inflationary pressures. Measures may include setting limits on credit growth or implementing regulations to prevent excessive risk-taking by financial institutions. Conclusion Inflation is a multifaceted economic phenomenon which affects consumer purchasing power, investment decisions, interest rates, and the dynamics of international trade. While moderate inflation is considered a normal feature of a healthy economy, excessive or unpredictable inflation can pose significant challenges. ‘India’s indebtedness levels Syllabus: GS3/Indian Economy and Issues related to mobilization of resources News: The Union Finance Ministry recently sought to dispel “certain” factually incorrect “presumptions” being made about India’s indebtedness levels by IMF. About: The International Monetary Fund (IMF) in its Article IV consultations with India, IMF warned government debt could hit 100% of GDP by 2027-28 under adverse circumstances. Do you know?– An Article IV Consultation is a regular discussion held between the IMF and its member countries, typically once a year. – It’s essentially a health check of the country’s economy, aiming to:a. Assess the overall economic situationb. Identify potential risks and vulnerabilities andc. Provide policy advice Government Debt Status: General Government Debt includes debt of both the Centre and the State Governments. The central government’s debt stood at Rs 155.6 trillion, or 57.1% of GDP, at the end of March 2023. During the same period, the debt of state governments stood at about 28% of GDP. It is important to note that General Government Debt in India is overwhelmingly rupee-denominated, with external borrowings contributing a minimal amount. Domestically issued debt, largely in the form of government bonds, is mostly medium or long-term with a weighted average maturity of roughly 12 years for central government debt. Therefore, the rollover risk is low for domestic debt, and the exposure to volatility in exchange rates tends to be on the lower end. Is there a need to worry? Among the various favourable and unfavourable scenarios given by the IMF, only under one extreme possibility, it has been stated that the General Government’s debt could be “100 percent of debt to GDP ratio” under adverse shocks by FY2028. It talks only of a worst-case scenario and not a must happen phenomenon. Similar IMF Reports for other countries show much higher extreme scenarios for them. The corresponding figures of ‘worst-case’ scenarios for the USA, UK and China are about 160, 140, and 200 per cent, respectively, which is far worse compared to 100 per cent for India. It is also noteworthy that the same report indicates that under favourable circumstances, the General Government Debt to GDP ratio may decline to below 70 per cent in the same period. Therefore, any interpretation that the report implies that General Government debt would exceed 100% of GDP in the medium term is misconstrued. A cross-country comparison shows that India has done relatively well and is still below the debt level of 2002. Debt to GDP Ratio (Percent) What lies ahead? The General Government debt has steeply declined from about 88 per cent in FY 2020-21 to about 81 per cent in 2022-23, and the Centre is on track to achieve its stated fiscal consolidation target (to reduce fiscal deficit below 4.5 per cent of GDP by FY 2025-26). The States have also individually enacted their Fiscal Responsibility Legislation, which is monitored by their respective State Legislatures. Therefore, it is expected that the General Government debt will decline substantially in the medium to long term. PPP Beginner’s e-course of World Bank and India Syllabus: GS3/Economy In Context The World Bank and Department of Economic Affairs launched the Public-Private Partnership (PPP) Beginner’s e-course. About (PPP) Beginner’s e-course It is for fostering collaboration between the public and private sectors in infrastructure capacity-building. Aim: To provide foundational knowledge and insights to individuals keen on understanding and contributing to the dynamic realm of PPPs in India. It comprises 5 modules which covers the major elements associated with the lifecycle of PPP projects. Significance: This will help in structuring and implementing successful PPP projects across different infrastructure sectors in the country. Key Features of the PPP Beginner’s e-Course: Accessible Learning: Available online, the course ensures accessibility to a wide audience across the country. Expert-Driven Content: Curated by industry experts and policymakers, the course content reflects current trends and best practices in PPPs. Interactive Learning: Engaging multimedia elements, quizzes, and discussions foster interactive learning experiences. Certification: Upon completion of the e-Course, learners will receive a certificate recognizing their proficiency in PPP fundamentals. World Bank ‘s Development Projects in India The World Bank, established in 1944, has committed to lending worth $97.6 billion in India, including all active and closed projects. Of the total commitments, 19 percent have been committed to projects in the public administration sector, 15 percent to the agriculture, fishing and forestry sector, and 11 percent to the transport sector. About World Bank– It is an international financial institution that provides loans and grants to the governments of developing countries for the purpose of pursuing capital projects.– It was established along with the International Monetary Fund at the 1944 Bretton Woods Conference. – It comprises two institutions: the International Bank for Reconstruction and Development (IBRD), and the International Development Association (IDA). – Mandate: The World Bank Group has a mandate to reduce poverty and support sustainable development.a. The institution focuses on a wide range of areas, including education, health, agriculture, infrastructure, and environmental sustainability.– Reports: World Development Report (WDR), Global Economic Prospects (GEP), Doing Business Report, Global Financial Inclusion (Findex) Database, Poverty and Shared Prosperity Report. Facts In News Namdapha Flying Squirrel Syllabus: GS3/Species in News In Context A nocturnal flying squirrel has resurfaced in Arunachal Pradesh after going missing for 42 years. About The Namdapha flying squirrel (Biswamoyopterus biswasi) is an arboreal (living in trees), nocturnal flying squirrel endemic to Arunachal Pradesh in northeast India, where it is known from a single specimen collected in Namdapha National Park in 1981. Appearance: It has reddish, grizzled fur with white above. Its crown is pale grey, its patagium is orangish and its underparts are white. Threats: Poaching and potential habitat destruction, highlighting the need for robust conservation strategies. Conservation Status:Critically endangered by the IUCN. The Wildlife Protection Act of India placed it under Schedule I, indicating the highest level of protection. Namdapha National Park – Namdapha National Park is situated in the eastern Himalayan range in the northeastern state of Arunachal Pradesh established in 1983.– It is crossed from east to west by the Noa Dihing River, a tributary of Brahmaputra River. – The park is inhabited by species, such as the Bengal tiger, clouded leopard, snow leopard, red panda, Indian elephant, and various species of deer and primates.– Namdapha National Park has been designated as a Tiger Reserve to protect its significant tiger population.– It is also a part of the Eastern Himalaya Biodiversity Hotspot and has been recognized as a biodiversity hotspot by Conservation International.– It is also on the Tentative Lists of UNESCO World Heritage Sites in India. PM-DevINE Scheme Syllabus: GS3/Economy In Context The Ministry of Development of North Eastern Region (DoNER) has held meeting with Chief Ministers of northeast States over lag in Prime Minister’s Development Initiative for North East Region (PM-DevINE) scheme. About The scheme was announced in the 2022-23 Union Budget with an initial allocation of ₹1,500 crore. It is a Central Sector scheme, with 100% Central funding. Aim: PM-DevINE is aimed at rapid and holistic development of the North- East Region by funding infrastructure and social development projects, based on felt needs of the States. Objectives: fund infrastructure convergently, in the spirit of PM GatiShakti; support social development projects based on felt needs of the NER; enable livelihood activities for youth and women; and fill the development gaps in various sectors. The time frame defined for PM-DevINE scheme projects is 2023-24 for sanction and 2025-26 for completion. It will be implemented by the Ministry of Development of North Eastern Region (MDoNER) through North Eastern Council or Central Ministries/agencies or State Government agencies. Palna Scheme Syllabus: GS1/Society In Context The Women and Child Development Minister inaugurated the National Programme on Anganwadi-cum-Crèches. About Government has planned to open 17 thousand creches all around the country. A new Standard Operating Procedure (SOP) for anganwadi-cum-creche centres was also released. It outlines a comprehensive framework for the administration and implementation of the scheme, including administrative hierarchy, roles, and responsibilities of the workers and monitoring checklist. About Palna Scheme Earlier known as the National Creche Scheme, it was reorganized and renamed as Palna Scheme under the sub scheme ‘Samarthya’ of ‘Mission Shakti’. Under the Palna Scheme, provision of Anganwadi cum Creches has been introduced by the Ministry of Women and Child Development. Objectives: Quality crèche care facility by providing a safe and secure environment for children of working women. To support nutritional, health and cognitive development of children. Enable mothers to take up gainful employment. Key Services: Sleeping facility Early stimulation for children below 3 years of age Pre-school education for children between the ages of 3 to 6 year Supplementary nutrition (to be locally sourced) Growth Monitoring, health check ups and immunization in convergence with POSHAN 2.0 Funding Pattern: A funding ratio of 60:40 between Union Government and State. Significance: The scheme enables more women to take up gainful employment amongst all socio-economic groups both in the organized and unorganized sector, irrespective of their employment status. Tax Devolution to States Syllabus:GS3/ Economy Context The central government has authorized the release of an additional installment of tax devolution amounting to ₹72,961.21 crore to State Governments. About The amount has been released for financing various social welfare measures and infrastructure development schemes. As per the norm, tax devolution is made through 14 installments to states in a year, with at least one installment in each month and two extra installments released in the last two months of the year. What is Tax devolution? Tax devolution, a key source of funding for state governments. Article 280(1) of the Constitutions lays down that the modalities for setting up of a Finance Commission to make recommendation on the distribution of net proceeds of taxes between the Union and the States, allocation between the States of respective shares of such proceeds; grants- in-aid and the revenues of the States and measures needed to supplement the resources of the Panchayats during the award period. The objective of tax devolution is to promote fiscal federalism, strengthen the financial autonomy of state governments, and empower them to meet the needs of their respective populations. Finance Commission Recommendations Currently, tax devolution is being administered by the recommendations of the 15th Finance Commission chaired by N.K.Singh. The Finance Commission had recommended that states be given 41 percent of the divisible tax pool of the Centre during the five-year period 2021-22 to 2025-26. Funding Winter Syllabus :GS 3/Economy In News As per recent report,The Indian startup ecosystem continues to face the prolonged funding winter period. About Funding Winter It refers to a period in which funding for startups becomes more difficult to obtain due to a variety of factors. It is attributed to a market slowdown and economic volatility on account of the prevailing macroeconomic and geopolitical conditions, which have driven inflation, commodity prices and interest rates. The slowdown in funding for Indian startups began around mid-2022. Consequences It has created a strain on profitability, leading to a challenging work environment for employees. But some industry observers claimed that It helped start-ups to manage their businesses better without burning excessive cash . Future Outlook The startups will have to come up with credible plans to ensure proper returns on investment. According to Experts,Funding winter for Indian startups is likely to end by March 2024. Indian Ocean Naval Symposium (IONS) 2023 Syllabus :GS 3/Defense In News The 8th edition of Indian Ocean Naval Symposium (IONS) Conclave of Chiefs (CoC) was conducted by the Royal Thai Navy at Bangkok About IONS The ‘Indian Ocean Naval Symposium’ (IONS) is a voluntary initiative . It was conceived by the Indian Navy in 2008 as a forum that seeks to increase maritime co-operation among navies of the littoral states of the Indian Ocean Region by providing an open and inclusive forum for discussion of regionally relevant maritime issues. India is scheduled to take over as the Chair of IONS (2025-27) during 9th CoC planned to be conducted in India at the end 2025. R21/Matrix-M Malaria Caccine Syllabus :GS 2/Health In News The World Health Organization (WHO) added the R21/Matrix-M malaria vaccine to its list of prequalified vaccines. Do you know ?– The prequalification means larger access to vaccines as a key tool to prevent malaria in children, with it being a prerequisite for vaccine procurement by UNICEF and funding support for deployment by Gavi, the Vaccine Alliance. About R21/Matrix-M The R21 vaccine is the second malaria vaccine recommended by WHO, following the RTS,S/AS01 vaccine, which received a WHO recommendation in 2021. Both vaccines are shown to be safe and effective in preventing malaria in children R21/Matrix-M developed by Oxford University and manufactured by Serum Institute of India. Malaria It is a mosquito-borne disease which mostly spreads to people through the bites of some infected female Anopheles mosquitoes. Blood transfusion and contaminated needles may also transmit malaria. It is mostly found in tropical countries.. The infection is caused by a parasite and does not spread from person to person. Symptoms: The most common early symptoms of malaria are fever, headache and chills. Disease burden: According to the latest World malaria report, there were 249 million cases of malaria in 2022 compared to 244 million cases in 2021. The estimated number of malaria deaths stood at 608 000 in 2022 compared to 610 000 in 2021. Prevention: Malaria can be prevented by avoiding mosquito bites and by taking medicines. XPoSat Syllabus: GS3/Developments in Science and Technology News: ISRO is likely to launch its first polarimetry mission XPoSat on January 1, 2024. About: It is India’s first, and only the world’s second polarimetry mission that is meant to study various dynamics of bright astronomical X-ray sources in extreme conditions. The other such major mission is NASA’s Imaging X-ray Polarimetry Explorer (IXPE) that was launched in 2021. It will become the country’s third space-based observatory after the recently launched solar mission Aditya-L1 and AstroSat launched in 2015. Mandate: To study the “polarisation” of astronomical X-rays, which can provide insights into the processes that resulted in its emissions. The observatory can help in understanding the emission mechanism from sources such as black holes and neutron stars (collapsed core of a massive star). Do you know?– Polarization is a property of light. – Light is the vibration of electric and magnetic fields. This is why light is called an “electromagnetic wave”. – In non-polarized light, both fields have a random orientation with respect to the direction of light propagation, while polarized light has a given vibration direction. – In astrophysics, studying the polarization of light is very useful: it can give information about interstellar dust or about the magnetic fields of celestial objects. Life: The planned life of the mission is five years. Payloads: It will carry two payloads in a low earth orbit: POLIX (Polarimeter Instrument in X-rays): It is expected to observe about 40 bright astronomical sources of different categories during the planned lifetime. XSPECT (X-ray Spectroscopy and Timing): XSPECT uses a method of observation called spectroscopy that studies the electromagnetic spectrum generated by different matter. Significance: IXPE of NASA and XPoSat of ISRO are complementary and can provide coordinated observations of phenomena across a wide energy spectrum. After the opening of the Indian space sector to private players, there has been an increase in the number of scientific missions launched by ISRO. Sovereign Credit Rating Syllabus: GS3/Indian Economy and Issues related to mobilization of resources News: Recently, the Finance Ministry released a document titled “Re-examining Narratives: A Collection of Essays”. About: The first of the five essays in the document is a criticism of the opaque methodologies adopted by credit rating agencies to arrive at sovereign ratings. The essay seeks to flag issues with the methodology adopted by the three main global credit rating agencies (Moody’s, Standard & Poor’s and Fitch) and to show how these gaps affect India adversely. It is argued that they are opaque and appear to disadvantage developing economies” in certain ways. Sovereign ratings: Sovereign ratings are about the creditworthiness of governments. They provide a marker for investors around the world about the ability and willingness of governments to pay back debt. Just as an individual’s credit rating is critical to whether she gets a loan and at what interest rate, sovereign ratings affect a country’s ability to borrow money from global investors. Importance of sovereign ratings: Governments with lower sovereign ratings have to pay higher interest rates when they borrow. Sovereign ratings matter also for all businesses in that country, as the government is considered to be the safest bet in a country. Most developing countries (such as India), while rich in either labour resources or land or mineral resources, suffer from a lack of capital (money available to put to use). In the absence of financial resources, developing countries struggle to make the best use of their natural strengths. A poor sovereign rating can inhibit the ability of these countries to borrow money from rich investors — just as a good rating can make it easier to become more productive and remove mass poverty. Stand of India Publicly challenging the rating agency’s claims and highlighting the alleged biases and providing counter-evidence to their assessments is crucial for a country like India. Also, seeking independent assessments from alternative credit ratings or reputable research institutions to provide a more balanced view is needed. Further, ensuring all relevant economic and financial data is readily available and easily accessible to the public and rating agencies. China bans Export of Rare Earth technologies Syllabus: GS3/ Economy News: China recently banned the export of technology to extract and separate the strategic metals. About: The move came as it overhauled a list of technologies deemed key to national security. It also banned the export of production technology for rare earth metals and alloy materials as well as technology to prepare some rare earth magnets. The reason is also given as Europe and the U.S. are trying to wean themselves off rare earths from China, which accounts for 90% of global refined output. About Rare Earth metals: Rare earths are a group of 17 metals used to make magnets for use in EVs and other electronics. These 17 elements are, Lanthanum, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, lutetium, scandium, yttrium. Do you know?– Rare earth elements are relatively plentiful in the earth’s crust, with cerium being the 25th most abundant element. This makes it as abundant as copper. – But, because of their geochemical properties, rare earth elements are typically dispersed. This means they are not often found in concentrated enough clusters to make them viable to mine. a. It was the scarcity of these minerals that led to them being called rare earths. Properties: These metals have unusual fluorescent, conductive, and magnetic properties, which make them very useful when alloyed, or mixed, in small quantities with more common metals such as iron. They are lustrous silvery-white soft heavy metals. Production: China accounts for 90% of the world’s rare earth production. The other major producers are Australia, USA, Russia, Malaysia and Vietnam. Indian Scenario: Like the rest of the world, India is an importer of rare earths. According to Statista in 2020, India’s import of rare earth amounted to 1,800 tonnes, about 0.67 per cent of the global figure. India’s share in the import of rare earths is modest, reflecting a low level maturity of its downstream industries like electronics, defence, and aerospace. However, as Make in India has made strides in these sectors, the demand for rare earths is growing. Assam-Meghalaya Panels on Boundary Syllabus: GS3/ Security Challenges and their Management News: The regional committees on the boundary dispute between Assam and Meghalaya have been asked to submit their reports by December 31. About: The boundary dispute between the two States has persisted since Meghalaya was carved out of Assam in 1972. Assam and Meghalaya had 12 disputed sectors along their 884.9-km boundary. The disputes in six of these sectors were settled through an agreement signed on March 29, 2022. The six disputed sectors that remain are Langpih, Borduar, Nongwah-Mawtamur, Deshdoomreah, Block-I, Block-II, and Psiar-Khanduli. Three regional committees for three districts were set up by both States to study the disputed sectors, meet the stakeholders, and submit a report to their respective governments. Do you know?– Assam and Arunachal Pradesh resolved their boundary disputes over 37 of 123 villages with the signing of the Namsai Declaration on July 15, 2022. Red Tide Syllabus:GS3/Environment Context A three-member committee appointed by the National Green Tribunal (NGT) inspected the Puducherry beach near Kuruchikuppam to analyze the cause behind the Red tide. What Is a Red Tide? A red tide is an event that occurs on the coastline when algae—a plant-like organism—grows out of control. The name “red tide” comes from the fact that overgrown algae can cause the water to change color. Red tides can be hazardous to human health and sea life. Harmful effects of red tides Toxin Production: It produces toxins, such as brevetoxins, saxitoxins, and domoic acid. These toxins can have harmful effects on marine life and can be transferred through the food chain. Shellfish Poisoning: Filter-feeding shellfish, such as mussels, clams, and oysters, can accumulate the toxins produced by red tide algae. When humans consume contaminated shellfish, they experience poisoning, such as paralytic shellfish poisoning (PSP) or amnesic shellfish poisoning (ASP). Marine Life Mortality: Fish, shellfish, and other marine animals may suffer from mass mortalities during red tide events. Economic Impact: Red tide events can have severe economic consequences for coastal communities that rely on fishing and aquaculture. Closures of fisheries and shellfish harvesting areas due to toxin contamination can lead to financial losses for fishermen, shellfish farmers, and related industries.

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