9 PM Daily Current Affairs Brief – May 2nd, 2022

Current Affairs Compilations for UPSC IAS Prelims 2022

Mains Oriented Articles

GS Paper 2

• Invigorating the Ayush industry
• India must make the most of the diplomatic attention it’s receiving
• Why Berlin Is A Key Partner For New Delhi
• The Delhi dual governance conundrum
• Revisit the Seventh Schedule to improve Centre-state relations

GS Paper 3

• Desi commerce: GoI’s ecommerce network for small players is a good idea. Customer interface will be critical
• A silicon waste alert for our creaky power sector
• Funding woes haunts Indian Science
• Ukraine rethinks on hyper-globalisation. Nations need to de-risk against overdependence on few suppliers
• India must use markets to decarbonise

Prelims Oriented Articles (Factly)

• Explained: Why US wants to ban menthol cigarettes, and what ‘racial justice’ has to do with it
• Economy may take more than a decade to overcome COVID-19 losses: RBI report
• India-UAE Comprehensive Economic Partnership Agreement(CEPA) enters into force
• India’s Pharma exports grow by 103% since 2013-14
• The recent woes of the jute industry in West Bengal
• Mechanism to process unorganized workers’ accident claims in the works, says Ministry
• PM inaugurates Joint Conference of Chief Ministers of States and Chief Justices of High Courts
• APEDA launches gluten-free millet products for all age groups at affordable prices
• Centre notified second phase of mandatory hallmarking which shall come into force from June 01, 2022

Mains Oriented Articles

GS Paper 2

Invigorating the Ayush industry

Context: The Ayush industry in India can provide cost-effective healthcare to people across States. It has all the ingredients of success, to co-exist with the modern health systems, as a choice-based system of traditional medicine.

The article lists out measures that can be implemented to reinvigorate the Ayush Ministry.

China’s example wrt its traditional medicine sector

The global market for herbal medicine was valued at $657.5 billion in 2020. It is expected to grow to $746.9 billion in 2022.

The Healthy China 2030 plan forecasts that the value of traditional Chinese medicine (TCM) market may reach $737.9 billion within China and globally by 2030.

The growth of the TCM industry in China is attributed to the immense attention the sector has received in the country.

– In 1982, the Constitution of China gave full recognition to TCM.

– Since 2009, there has been continuous support for TCM in health policies. China has focused upon developing quality infrastructure for TCM to co-exist with modern medicine under the same roof.

What has been the progress of the Indian Ayush sector over the years?

The Indian Ayush sector has grown by 17% between 2014 and 2020.

– Related segments such as plant derivatives grew by 21%, plant extracts by 14.7%, and herbal plants by 14.3% during the same period.

What measures have been taken in India to promote Ayush systems?

In India, the National Ayush Mission (NAM) was launched in 2014 by the Department of Ayush, Ministry of Health and Family Welfare, to promote Ayush systems and address the needs of the sector in a comprehensive way.

– Objectives of NAM: a) Providing cost-effective services, b) strengthening educational systems, c) quality control of drugs and d) sustainable availability of raw materials.

– Under the ‘Medicinal Plants’ component of the NAM scheme (2015–16 to 2020–21), the cultivation of prioritised medicinal plants in identified clusters/zones is being supported. For the cultivation of plants, subsidies at 30%, 50% and 75% of the cultivation cost for 140 medicinal plants are being provided.

Further, last year it was announced that medicinal plants will be cultivated on 75,000 hectares of land.

The Ministry of Finance has also announced a ₹4000-crore package under the Aatmanirbhar Bharat Abhiyaan for the promotion of herbal cultivation.

Prime Minister laid the foundation of the WHO-Global Centre for Traditional Medicine in Jamnagar on April 19, 2022. This will be the first and only global outpost centre for traditional medicine across the world.

What is the way forward?

The Ayush sector requires a multi-dimensional push, ranging from initiatives at the institutional level, massive awareness and promotion of cultivation of medicinal plants by farmers, to trade-related interventions and quality focus measures.

Strengthen SMPBs: The National Medicinal Plant Board (NMPB) implements the medicinal plant component of Ayush through state bodies—State Medicinal Plant Boards (SMPBs).

– The organisational structure of SMPBs needs to be strengthened. They should have experts for conservation, cultivation, R&D, herbal garden etc.

On the trade front, developing comprehensive databases on Ayush trade, products and raw materials is needed.

Expansion of HS national lines to accommodate various features of traditional medicine and medicinal plant products based on existing requirements is required to provide more comprehensive trade data on Ayurvedic products. To date, most ISM (Indian System of Medicine) products, herbal products and medicinal plants products are not identified under specific HS (Harmonised system) codes.

Integrative medicine: NITI Aayog has already constituted a committee and four working groups on integrative medicine, to provide deeper insights and recommendations in the areas of education, research, clinical practice and public health and administration.

Integration of Ayush systems into mainstream systems will certainly give wider acceptance for traditional systems of the country.

India must make the most of the diplomatic attention it’s receiving

Context: India witnessed a plethora of diplomatic activities in the past few days in light of the Raisina Dialogue, where representatives from Europe, and the West interacted with their Indian counterparts.

India’s Quad partners the US, Japan, Australia, its partners in Europe and several ASEAN countries, see India as an anchor that could help stabilise the present international situation. They have a stake in India emerging as an influential power and are willing to contribute to that end. This is an opportunity that ought to be leveraged as part of a broader strategy to significantly advance India’s long-term prospects.

It must be grasped.

Should India downgrade its ties with Russia, and how have they developed over the years?

No.

There are valid legacy reasons for maintaining positive ties with Russia just as some European countries have had to do.

Present India-Russia relations are not a continuation of the old Indo-Soviet ties. That strategic partnership that helped India cope with the Cold War and the Chinese and Pakistani threats ended with the war and the collapse of the Soviet Union.

Moscow no longer sees Beijing as its main security challenge, but for India, China became a bigger challenge.

India’s economic and trade relationship with Russia has become increasingly marginal.

Prospects of a new energy partnership failed to materialise as for Russia, China emerged as a more proximate and attractive power.

Even the defence hardware relationship has diminished progressively as India has rightly tried to diversify its sources of supply.

Why India needs to rethink its Russia policy?

A key assumption in India’s Russia policy has been that as a great power,

– Moscow would be unlikely to accept a junior partnership with China;

– And that it is China that was increasing its presence and influence in Central Asia and Eastern Europe, which Russia considers its “near neighbourhood” and security perimeter.

In the long run, Russian and Chinese interests would not be aligned and, therefore, India should maintain a close relationship with Moscow.

This was also the reason why India argued with the US and other western partners that they needed to be more accommodative of Russian interests so that it could distance itself from Beijing.

Even if the Ukraine war had not erupted, the February 4 Sino-Russian Joint Declaration should have led India to question the continuing validity of these assumptions.

How India needs to shape its foreign policy engagement?

In a shifting geopolitical landscape, it is in India’s interest to remain engaged with Russia and China as two leading powers in the world. Such engagement is important to ascertain how these powers are themselves adjusting to the changing geopolitical equations across the world.

Russia is already a seriously weakened power in a European order and will not be able to prevent Finland and Sweden from joining NATO.

The domestic politics of the US is unpredictable, and this calls for caution.

Europe will likely emerge as a more coherent and cohesive entity, anchored in German power, and playing a role more independent of the US until now. All the more reason why India must deepen its all-round partnership with Europe, build a shared vision of an altered geopolitical landscape and encourage Europe to play a greater role in the Indo-Pacific.

Way forward

The attention being paid to India reflects not what India is. but rather what India could become as one of the key architects of a new international order.

It is time to think strategically about India’s place in a world which is in the midst of a historic transformation.

Why Berlin Is A Key Partner For New Delhi

News: Indian PM is in Berlin for the biennial Inter-Governmental Consultations. The IGC invitation was initiated by Germany during the Ukraine crisis, indicating the importance of India as a global partner.

This follows the visits of the UK prime minister and the European Commission president to India.

The Nordic Summit will follow.

PM’s stop by Paris to meet the French president after a crucial election would be a good sign.

India’s European policy seeking a multipolar world is in full swing.

What are the main features of Indo-German partnership?

India and Germany are strategic partners.

– The partnership mostly deals with climate and sustainability issues. There are no traditional strategic elements like space, nuclear, or defence partnerships. Nevertheless, there is a strategic aspect related to the revival of the partnership amid the Ukraine crisis and the reordering it brings.

– Germany and India are supporters of globalisation. Germany is the most reluctant in Europe to impose unilateral sanctions on Russia and on curbing engagement. It will suffer immense pain with the reduction in Russian energy supplies.

– On Russia: Germany and India agree that Russia cannot be isolated, remain engaged with it and insist it must play within the rules. Maintaining a dialogue is common to Berlin and New Delhi and this could form the basis of a viable political understanding.

– On China: With the Russian policy in bad shape, the China-cautious partners of German coalition Govt seek to deal with Beijing as a systemic rival. India does not want Russian action in Ukraine to distract from Chinese transgressions. A commonality of view on the threat from China to the international order is another aspect of the Indo-German strategic understanding.

– On Green finance: The Indo-German partnership has deepened its climate friendly agenda. More than €1 billion annually is committed by Germany for various green ideas, including solar power, electric mobility, smart cities and Namami Gange. An enhanced partnership on climate, green infrastructure, sustainability and development for the next decade will be the mainstay of the Indo-German strategic partnership.

Way forward

Given the success of the Indo-German environmental and energy partnership, it is time for India and Germany to take this model to other developing countries. Germany through the Compact for Africa, and India through the India-Africa Forum Summit, have dedicated African policies as well as an interest in Latin America.

– Replicating Indian development initiatives – some with German collaboration – in Africa and Latin America can be a major objective. This could initially promote green energy, training, women’s empowerment and the achievement of SDGs.

– There is scope for joint vaccine production, for which Germany has committed funding for Africa, which is India’s major market for pharmaceuticals and vaccines.

– The ‘Achieving SDGs Together’ approach will perhaps be the motto of India and Germany ahead.

Germany needs to enhance its trade and investment with India. The recent visit of the German state secretary for economic cooperation and the brighter prospects for the India-EUFTA and investment agreements are encouraging.

– German companies are moving from their individual production approach to supply chain production lines. By establishing regional or global manufacturing hubs in India, they may utilise India’s FTA with ASEAN and access to Africa to enhance exports from India.

– This could well be a type of China +1 policy. If this can be embedded in the German thinking, and used to wean Germany incrementally away from China, it will be a strategic boost to the Indo-German partnership.

The Delhi dual governance conundrum

Context: Delhi has been experiencing a prolonged confrontation on the relative powers of the territorial administration and the Union government. However, recently, the 2021 amendment to the Government of National Capital Territory of Delhi Act,1991 has been enacted. The aforementioned amendment is also under challenge before the Supreme Court. 

Nature of Delhi in the federal scheme 

Delhi is a Union Territory under Schedule 1 of the Constitution. It has the absence of statehood. However, it has been declared as the “National Capital Territory” which is governed under Article 239AA. 

What are the factors that have led to power tussle in the Delhi Governance? 

Dilemmas of dual governance: Delhi is governed by the elected Council of Ministers i and the Central Government through the Administrator of Delhi, renamed as the Lieutenant Governor (L-G). Therefore, issues in the governance of Delhi arose, with respect to who is empowered to control the agencies, namely the Anti-Corruption Bureau, the Civil Services and the Electricity Board.  

The Supreme Court’s pronouncements with respect to the dual governance of Delhi 

Earlier, the Delhi High Court has decided in favour of the Central Government relying on the status of Delhi as a Union Territory.  

The SC decided on the substantial questions of law in reference to the powers of the elected government of Delhi vis-a-vis the L-G pertaining to the Administration of NCT. The observations made were: 

(1) The objectives behind the Constitution (Sixty-ninth Amendment) Act shall guide the interpretation of Article 239AA. Article 239AA was interpreted from the perspective of the principles of federalism and democracy, thereby, according a sui generis status to Delhi in distinction from other Union Territories (UT) which were more centrally governed. 

(3)  The Delhi Assembly has the power to make laws over all subjects that figure in the Concurrent List, and all, except three excluded subjects, in the State List. Further, in these matters, the LG is bound by the “aid and advice” of the Council of Ministers of Delhi. 

(4) The L-G ought to act on the “aid and advice” of the Council of Ministers, except when he refers “a matter” to the President for a final decision in case of a difference of opinion between L-G and the Council of Ministers. However, the SC ruled that “any matter” cannot be construed to mean “every matter”. The LG should refer only in exceptional circumstances.  

(5) L-G shall act as a facilitator rather than posing himself as an adversary to the elected Council of Ministers.  

(6) The SC ruled that the National Capital Territory of Delhi cannot be granted the status of a State under the constitutional scheme. 

(7) It was ruled that the Anti-corruption Bureau (ACB) comes under the Centre, the Electricity Board under the Government of NCT, a Commission of Enquiry under the Commissions of Enquiry Act can be constituted by the centre, the power to appoint Public Prosecutor is vested with Government of NCT.  

What were the unresolved questions? 

One Judge (In a two-judge bench of the SC) held that services should be outside the purview of the GNCTD, and the other judge held that officers below the rank of joint secretary are under the control of the Government of NCT. 

Way Forward 

Due to the split, the matter of services is being heard by a three-Judge Bench of the Supreme Court (SC). However, there are also demand to refer the matter to the Constitution Bench of the SC. 

The persons holding high office are expected to conduct themselves in faithful discharge of their duties. It would ensure smooth running of administration and protection of the rights of the stakeholders. 

Revisit the Seventh Schedule to improve Centre-state relations

News: Recently, the Union government revoked the orders and guidelines issued under the Disaster Management Act (DMA), 2005 after covid knocked on India’s doors. The DMA has been the backbone of policy interventions to fight covid.  

What are the constitutional provisions with respect to invoking the laws? 

Any legislation can be passed under an enabling constitutional provision. Article 246 talks about the Union, state and concurrent lists which are mentioned in the Seventh Schedule of the Constitution. 

Considering, health is a state subject mentioned in the state list and disasters do not find mention in any lists in the Schedule VII. Therefore, the union government invoked the Disaster management Act (DMA) 2005 by relating to Entry 23 (Social Security and Social Insurance) in the Concurrent List of the Constitution. It was invoked to deal with covid-19.  

How was the DMA 2005 used by the states? 

Some states like West Bengal, Maharashtra, Odisha, Jharkhand and Chhattisgarh legalized the home delivery of alcohol under the ambit of the DMA. Ironically, it was invoked for liquor delivery to promote social security and social insurance. It was also aimed to address a shortfall in tax revenues (Taxes on alcohol account for a significant share of the total revenue in many states)  

However, at present the DMA has been revoked. Therefore, in the absence of enabling legislation (due to revocation of the DMA), the states will have to curtail the home delivery of alcohol.  

What are the issues that plague the Seventh Schedule?  

The Seventh Schedule was inherited from the Government of India Act, 1935. Therefore, it is a relic of the colonial past. The lists do not reflect the complex realities of India in its 75th year of independence. For example, despite having health as the state subject, the Union government was in a better position to legislate on some issues related to health (vaccination, for instance) 

The states often shift their responsibilities upon centre. For example: (1) state highways are often classified as national highways, and (2) the states ask for the help of paramilitary forces in times of crisis despite having law and order as the state subjects. 

States have also advocated the transfer of some subjects from the Union and concurrent lists to the state list. For instance, entry No. 58 of the Union list is on the manufacturing, supply and distribution of salt.  

States have also criticized the transfer of some subjects from the state list to the concurrent list. ‘ 

Way Forward 

The Sarkaria Commission and the Punchi Commission. Both advised comprehensive consultation between the Union and state governments before moving anything from the state list to the concurrent list.  

N.K. Singh, chairman of the 15th Finance Commission, has time and again argued for reforms in the Seventh Schedule. 

Some have even advocated further decentralization of that Schedule by introducing a local government list in the light of rapid urbanization across countries. 

There has to be periodic reviews of these lists—say, after every 20 years.  

GS Paper 3

Desi commerce: GoI’s ecommerce network for small players is a good idea. Customer interface will be critical

Context: GoI’s quest to build an open digital ecommerce network for small businesses holds great promise.

The proposed model can potentially be a game-changer for small retailers and new tech startups facing big ecommerce giants and their market dominance and commissions.

It can also address sellers’ limitations of being tied down to one platform, and supposedly opaque algorithms used by them to prioritise some sellers.

ONDC can also help tomorrow’s ecommerce/tech startups save redundant investments in the ecommerce network and focus on customer acquisition.

What is the way forward?

Unlike in digital payments and the pioneering UPI, ecommerce has dominant players with user-friendly websites and apps, excellent customer service and fast delivery networks. Hence, ONDC-based offerings have to be just as good to attract sellers and customers.

And the smart non-disruptive solution will be to allow existing ecommerce players to operate as they are, with their proprietary technologies for vendor onboarding, inventory, price discovery, delivery logistics.

ONDC, with its premise of greater cross-platform visibility and discoverability of sellers, shouldn’t be thrust on anybody.

– If interoperable networks and applications built on ONDC ease tasks like cataloguing, inventory management, order fulfilment and delivery logistics, both buyers and sellers would be automatically attracted.

A silicon waste alert for our creaky power sector

Context: India’s power crisis is best described by a disconnect between installed capacity and availability that must be sorted out.

What are the major reasons behind the power shortage in the country?

India has an installed capacity to generate almost 400 gigawatts of electricity, and about 40% of it cleanly. But a surge in peak demand to nearly 205 gigawatts, amid the blistering heatwave in the April, led to frequent power outages in various parts of the country.

Shortage of coal: Coal shortage can be attributed to following two reasons: – a) a rise in demand from pre-covid peaks that traced a revival in the Indian economy, even as extra power was guzzled by an early AC season amid record temperatures, b) the Ukraine war made prices of coal spike.

– As Indian coal importers looked to domestic sources, local stuff fell short.

– Problems with the discom sector: Most discoms in India are state-run entities that are strapped for cash and stretched out of shape by a status quo at the usage end of the market, where theft and freebies are rampant and subsidy-transfer delays from state coffers are routine.

Way forward

India needs to go for end-to-end reforms that could link demand and supply efficiently.

Funding woes haunts Indian Science

News: The Union Ministry of Science and Technology budgetary allocation in the current financial year (2022-23) has seen a drop from the last year. The 2022-2023 Union Budget has seen a drop of 3.9% from last year. 

What is the significance of science and tech? 

The purpose is to understand the world better. It is a highly competitive field among the nations.  

The funding of science and technology has often been touted as a marker of social advancement. 

Status of India’s R&D expenditure 

The research in India is primarily sustained by direct funding from the government. There is little participation from the private sector. 

India’s share in the global R&D expenditure is at 1-3% of the global total. However, the share of the U.S. and China is around 25% and 23% respectively.  

The proportion of qualified researchers is very low in India. In 2017, there were 255 researchers per million people in India in contrast to 8,342 per million in Israel, 7,597 in Sweden and 7,498 in South Korea.  

The budgetary allocations have shown a consistent downward trend over a last few years. It varied between 0.6 to 0.8% of GDP over a decade. It is way below the United States, China, Japan, the European Union countries and South Korea.  

There is a skewed distribution of funds. Most funding goes to DRDO, Department of Space and Atomic Energy. However, ICAT, CSIR, DST, DBT, MoES and Indian Council of Medical Research (ICMR) received the rest of the 30 to 40% of the public funds.  

Despite, jump in the number of universities from 752 to 1,016, and the number of students doing doctoral degrees, the funding remained frozen between 2011 and 2018. 

Most of the country’s scientific research is being conducted by government laboratories and a few premier institutes.  The agency will lead to democratisation of the knowledge base. 

Some of the measures taken to boost scientific research funding in India  

In pursuance to the National Education Policy 2020, the government announced to establish a new funding agency called the National Research Foundation (NRF). It is expected to bring thousands of colleges and universities under its ambit, therefore to boost university science research and work in social sciences. The 2021-22 budget announced to offer ₹10,000 crore every year to this agency starting from 2021, over the next five years,  

The 2021 budget speech also expressed the intention of investing about ₹4,000 crore over five years for deep-ocean research and biodiversity conservation. 

The government has shown commitment to set up four centres for virological research and development of hydrogen energy. .  

Way Forward 

The scientific institutions need more autonomous, more participatory, and less bureaucratic functioning as well as a vibrant and responsive financial system to unleash the fullest potential of Indian science. 

India must choose to break the bureaucratic barriers that exist in the government departments and develop innovative ways to help basic research flourish. 

The government should release enough funds for scientific research. The R&D spending can be raised to at least 1% of the GDP.  

It is also important for the private sector to chip in. The government should incentivise the private players like tax breaks, etc.  

Further, the NRF should be set up. It should be independent of political interference, and the related financial commitment. In addition, the SERB (Science Engineering Research Board) can be upgraded.  

India can learn a lot from China as it has become a world leader in scientific research in a short span of time. 

Ukraine rethinks on hyper-globalisation. Nations need to de-risk against overdependence on few suppliers

Relevance: External Sector, Self-Reliant India 

News:  Recently, Indonesia, the world’s largest producer and exporter of the palm oil has been experiencing domestic shortages of the same. This led to spike in the domestic palm oil prices in Indonesia and the world (including India). Therefore, Indonesia has announced to ban all exports.  

What is the concept of hyper-globalization? 

In a hyper-globalised world, countries produce things in which they have comparative advantage and import those others can make at lower opportunity cost.  

For example, Indonesia and Malaysia produce palm oil; and Ukraine and Russia produce sunflower oil. They have comparative advantages in the palm oil and sunflower oil. Therefore, Indonesia alone is the largest exporter of palm oil.  

What are the issues in hyper-globalization? 

It leads to too much dependence on supplies from one or two countries. For example, palm oil, which accounts for roughly 40% of India’s annual vegetable oil consumption, is almost entirely imported from Indonesia and Malaysia.  

This can lead to supply disruption in case of crisis. For example, In wake of the Russia-Ukraine war, the supply of sunflower oil has been disrupted.  

In fact, high international crude prices have led to diversion of palm and soyabean oil for making bio-diesel.  

The disruption in the supply of commodities impacts the prices of the other commodities. For example, At present, palm oil prices are causing strain in the prices of vanaspati, margarine, bread, biscuits, noodles, frozen dessert, namkeens, mithai, soap and cosmetics etc. 

Way Forward 

Hyper-globalisation and leveraging comparative advantage work well in a world without geopolitical frictions or natural disasters. For example, 2011 Thailand floods impacted the computer hard drive supply chain.  

In the real world, countries need to de-risk against overdependence on few suppliers, especially of products entailing heavy foreign exchange outgo.  

The Indian government needs to reduce dependence on import of edible oils from the current 60-65%.  

Domestic producers can be given one-time capital subsidy and tariff support based on long-term import parity pricing.  

There are collateral benefits, too, from some paddy and wheat acreage getting diverted to oil palm or mustard.

India must use markets to decarbonise

News: Recently, in the Conference of Parties (CoP-26) of the UNFCCC held at Glasgow in November 2021 several partner countries were seen committed to concrete action plans to contain global warming under the threshold of 1.5 degrees Celsius.  

Why should India decarbonize? 

Climate change is bound to impact human lives and the global economy. This is going to be at an exceptionally high scale in the coming future.  

After China and the United States, India is the third-largest emitter of the Carbon dioxide. Thus is a key player in emissions reduction. 

As per the IEA’s India Energy Outlook 2021 Report, India’s energy system is highly dependent on fossil fuels i.e., coal, oil and bioenergy. Thus, Indian energy ecosystem is highly carbon-intensive. 

India is a growing economy which would demand more energy consumption with time. As per the IEA’s World Energy Outlook Report 2017, India will account for nearly one-fourth of the global energy demand by 2040. Therefore, India’s economic growth should be sustainable. It requires carbon emissions reductions. 

What are the reasons behind high Greenhouse Gases (GHG) emissions and the climate change? 

It is a feature of market failure. The consumer’s economic activities like driving or air-conditioning and the producer’s economic activities such as electricity generation and manufacturing are inefficient in nature.

They cause emissions, leading to pollution and global warming. These negative externalities are not reflected in the costs of production and consumption. This leads to an uncontrolled rise in emissions and also breeds apathy towards mitigation efforts.  

Way Forward 

There is a need to address the problem of market failure. Government intervention is required in a number of ways.  

(A) The government can adopt the command-and-control strategy. This involves regulations for reducing emissions like setting emission levels and fixing limits of emissions. However, it would be good only during the initial phase of the mitigation strategy. 

Further, the Nationally Determined Contribution targets or emission levels set by the country under the Paris Agreement should not be wrongly set. It could lead to cost-inefficient outcomes.  

(B) The carbon tax is a better option. I would work well for regulating the pre-fixed levels of emissions. This option will lead to near-efficient outcomes. Initially, the firms reduces the emissions, the marginal cost of abatement rises. However, the firm will stop reducing emissions and choose to pay tax at the point when the cost of abatement becomes higher than the rate of tax.  

The government can introduce an auction-based carbon trading scheme. It will spur higher efficiency. The price of certificates will be determined in the free market between the firms facing low and high abatement costs. It will determine the optimal and cost-efficient levels of emissions reduction. The firms will have choice to either mitigate or trade. The firms having low abatement-cost will keep reducing emissions as they would profit by trading the certificates. They will adopt green-tech, renewable energy, electrification and energy efficiency measures. 

India should adopt an effective policy framework for emissions reduction. It should take into account the reasons for market failure.  

The market-based instruments are the most efficient tools for the transition to a green energy economy.  

The government should ensure equity in energy access. It should channel the revenues generated from carbon pricing to households and firms impacted by the carbon trading and carbon tax. 

Prelims Oriented Articles (Factly)

Explained: Why US wants to ban menthol cigarettes, and what ‘racial justice’ has to do with it

Source: The post is based on the article “Explained: Why US wants to ban menthol cigarettes, and what ‘racial justice’ has to do with it” published in Indian Express on 29th April 2022.

What is the News?

The US Food and Drug Administration has issued a proposal to ban menthol cigarettes and flavoured cigars.

What is the proposal of the US on Menthol Cigarettes?

The US aims to prohibit menthol as a characterizing flavor in cigarettes and prohibit all characterizing flavors (other than tobacco) in cigars.

What are the reasons behind this menthol cigarettes ban?

Health: Menthol has a minty taste and aroma. Further, it reduces the irritation and harshness of smoking. This increases the appeal and makes menthol cigarettes easier to use, particularly for youth and young adults.

Menthol interacts with nicotine in the brain to enhance nicotine’s addictive effects. Thus making it more difficult for people to quit smoking.

Younger Population: The proposed ban will affect a large share of the smoker population, especially young adults and racially disadvantaged groups.

Which countries have already banned menthol cigarettes?

The first country in the world to ban menthol cigarettes was Brazil in 2012.

In 2017, Canada banned these cigarettes and the European Union in 2020. Turkey, Moldova and Ethiopia have also banned menthol cigarettes.

What about India on Menthol Cigarettes?

India has not banned the sale of menthol cigarettes.

In 2019, the Government of India banned electronic cigarettes. In addition, different states have their own rules in place banning hookah consumption, including flavoured hookahs, in public places.

What will be the impact of the menthol cigarettes ban in India?

If India were to ban menthol and other flavored cigarettes, the impact might be limited, given that chewing tobacco and bidi are the most common forms of tobacco use.

Moreover, banning such products has logistical issues as well because banning will increase the smuggling of the products.

Economy may take more than a decade to overcome COVID-19 losses: RBI report

Source: The post is based on the article “Economy may take more than a decade to overcome COVID-19 losses: RBI report” published in The Hindu on 29th April 2022.

What is the News?

The Reserve Bank of India has released the Report on Currency and Finance (RCF) for the year 2021-22. 

Theme of the Report: ‘Revive and Reconstruct’ in the context of nurturing a durable recovery post-Covid and raising trend growth in the medium-term.

What are the key highlights from the report?

Covid-19 Impact on Indian Economy: Covid-19 pandemic is a watershed moment and the ongoing structural changes catalyzed by the pandemic can potentially alter the growth trajectory in the medium term. For instance, the Indian economy is likely to take over 12 years to overcome the COVID-19 losses.

Russia-Ukraine Conflict: The Russia-Ukraine conflict has dampened the momentum of recovery, with its impact transmitting through record-high commodity prices, weaker global growth outlook and tighter global financial conditions.

Deglobalization threat: Concerns surrounding deglobalisation impacting future trade, capital flows and supply chains have amplified uncertainties for the business environment.

What are the reforms suggested by the report?

Seven Wheels of Economic Progress: The blueprint of reforms proposed in the Report revolves around seven wheels of economic progress: 1) Aggregate demand, 2) Aggregate supply Institutions, 3) Intermediaries and markets, 4) Macroeconomic stability and policy coordination, 5) Productivity and technological progress, 6) Structural change and 7) Sustainability.

Rebalancing of Monetary and Fiscal Policies: Timely rebalancing of monetary and fiscal policies will likely be the first step in this journey.

Price Stability: Price stability is a necessary precondition for strong and sustainable growth.

Reducing Government Debt: Reducing general government debt to below 66% of GDP over the next five years is important to secure India’s medium-term growth prospects.

Promoting Industrial revolution 4.0: Industrial revolution 4.0 and committed transition to a net-zero emission target warrant a policy ecosystem that facilitates the provision of adequate access to risk capital and a globally competitive environment for doing business.

Better FTA Negotiations: India’s ongoing and future free trade agreement (FTA) negotiations may focus on the transfer of technology and better trade terms for high-quality imports from partner countries to improve the outlook for exports and domestic manufacturing.

Other Structural Reforms: The report has suggested several structural reforms which include: 1) Enhancing access to litigation free low-cost land, 2) Raising the quality of labor through public expenditure on education and health and the Skill India Mission, 3) Scaling up R&D activities with an emphasis on innovation and technology, 4) Creating an enabling environment for start-ups and unicorns, 5) Rationalization of subsidies that promote inefficiencies and 6) Encouraging urban agglomerations by improving the housing and physical infrastructure.

India-UAE Comprehensive Economic Partnership Agreement(CEPA) enters into force

Source: The post is based on the article “India-UAE Comprehensive Economic Partnership Agreement(CEPA) enters into force” published in PIB on 1st May 2022.

What is the News?

The historic India-UAE Comprehensive Economic Partnership Agreement (CEPA) which was signed between the two nations has officially entered into force.

What is India-UAE CEPA?

Click Here to read about it

How will this agreement benefit India?

Goods: India will benefit from preferential market access provided by the UAE on over 97% of its tariff lines which account for 99% of Indian exports to the UAE in value terms. Particularly from labour-intensive sectors such as Gems and Jewellery, Textiles, leather, footwear, sports goods among others.

Services: Indian service providers will have enhanced access to around 111 sub-sectors from the 11 broad service sectors. 

Expected Impact: CEPA is expected to increase the total value of bilateral trade in goods to over US$100 billion and trade in services to over US$15 billion within five years.

Note: Exports are an important engine of growth in every economy. For instance, $670 bn of exports (goods and services) from India during the last fiscal year constituted 22-23% of the GDP.

India’s Pharma exports grow by 103% since 2013-14

Source: The post is based on the article “India’s Pharma exports grow by 103% since 2013-14” published in PIB on 1st May 2022.

What is the News?

According to the Ministry of Commerce and Industry, Indian pharma exports witnessed a growth of 103% since 2013-14.

About Indian Pharmaceutical Exports

Pharma Exports: Indian pharma exports witnessed a growth of 103% from 2013-14 till 2021-22. This is a remarkable growth with exports growing by almost USD 10 billion in 8 years. Moreover, the Pharma trade balance continues to be in India’s favour. 

Pharmaceutical Production: India ranks 3rd worldwide for Pharmaceutical production by volume and 14th by value. The current market size of the Indian pharmaceutical industry is around USD 50 billion. 

Moreover. Indian pharma companies enabled by their price competitiveness and good quality have made a global mark with 60% of the world’s vaccines and 20% of generic medicines coming from India.   

Share of India’s Pharmaceutical Drugs in Global Exports: The share of pharmaceuticals and drugs in our global exports is 5.92%. Formulations and biologicals continue to account for a major share of 73.31% of India’s total exports followed by Bulk drugs and drug intermediates.

Pharma Export Destinations: India’s top 5 pharma export destinations are the USA, UK, South Africa, Russia and Nigeria.

Around 55 % of our pharma exports from India cater to highly regulated markets. For instance, the largest number of FDA approved plants outside the US is in India.

The recent woes of the jute industry in West Bengal

Source:  The post is based on the article “The recent woes of the jute industry in West Bengal” published in The Hindu on 2nd May 2022.

What is the News?

Member of Parliament(MP) from Barrackpore constituency in West Bengal has met the Textile Minister to apprise him about issues concerning jute farmers, workers and the overall jute industry.

He said that the operations of 20 jute mills in his constituency with lakhs of people dependent on them were adversely affected with many forced to shut down and many others on the verge of closure.

What is the problem the Indian Jute Industry is facing?

In simple words, jute mills are procuring raw jute at prices higher than what they are selling after processing. 

Why is this happening? 

Mills do not acquire their raw material directly from the farmers. This is because the farmers are far-off from the mill’s locations and the procurement process is cumbersome. Due to this, procurement now flows through middlemen or traders. 

These middlemen charge mills for their services which involve procuring jute from farmers, grading, bailing and then bringing the bales to the mills.

The government has a fixed Minimum Support Price(MSP) for raw jute procurement from farmers which is ₹4,750 per quintal for the 2022-23 season.

However, jute reaches mill at ₹7,200 per quintal that is, ₹700 more than the ₹6,500 per quintal cap for the final product. This is why the procuring price is higher than the selling price.

Jute Industry in India

Jute Industry in India is 150 years old. In India, Jute is primarily grown in West Bengal, Odisha, Assam, Meghalaya, Tripura and Andhra Pradesh. (West Bengal, Bihar and Assam account for almost 99% of India’s total jute production)

Jute is the only crop where earnings begin to trickle in way before the final harvest. The seeds are planted between April and May and harvested between July and August.

Jute production is a labour-intensive industry. It employs about two lakh workers in West Bengal alone and 4 lakh workers across the country.

Uses of Jute: The bulk of the final jute produced is used for packaging purposes. The provisions of the Jute Packaging Material (Compulsory use in Packing Commodities) Act, 1987 or the JPM Act mandate that 100% production of foodgrains and 20% sugar production must be packaged in jute bags. 

Other uses of Jute are: Used in insulation (replacing glass wool), geotextiles, activated carbon powder, wall coverings, flooring, garments, rugs, ropes, gunny bags, handicrafts, curtains, carpet backings, paper, sandals and furniture.

India as a Jute Producer

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-fourths of the global jute exports in comparison to India’s 7%. 

This can be attributed to the fact that India lags behind Bangladesh in producing superior quality jute fibre due to infrastructural constraints related to retting, farm mechanization, lack of availability of certified seeds and varieties suitable for the country’s agro-climate. 

Further, Bangladesh provides cash subsidies for varied semifinished and finished jute products.

Mechanism to process unorganized workers’ accident claims in the works, says Ministry

Source:  The post is based on the article “Mechanism to process unorganized workers’ accident claims in the works, says Ministry” published in The Hindu on 1st May 2022.

What is the News?

The Ministry of Labour and Employment is working on a mechanism to process accident insurance claims by unorganized workers registered on the e-Shram portal.

What is e-Shram Portal?

The Ministry of Labour and Employment had launched the e-Shram Portal with the aim of creating a national database of unorganized workers and facilitating social security schemes for them. 

During the launch of the portal, the Government has said that the workers registered on the portal would also be eligible for ₹2 lakh as accident insurance.

How will the accidental insurance cover be provided?

The government is planning to link the e-Shram portal with the Pradhan Mantri Suraksha Bima Yojana, the Centre’s existing accident insurance scheme. 

The scheme would allow the workers to get the direct benefit transfer(DBT) through the e-Shram unique ID number. 

The unique IDs on the e-Shram portal carried the same series from the Employees Provident Fund Organization(EPFO) universal account number(UAN).

Note: In Budget 2022-2023, the Finance Minister had announced the linking of four portals such as the National Career Service, e-Shram, UDYAM (for those interested in starting MSMEs) and ASEEM (Atmanirbhar Skilled Employee Employer Mapping). 

Among them, the inter-linking of the NCS and e-Shram portals had been completed. This linkage has enabled unorganized workers registered on e-Shram to seamlessly register on NCS and look for better job opportunities through NCS.

PM inaugurates Joint Conference of Chief Ministers of States and Chief Justices of High Courts

Source: The post is based on the article “PM inaugurates Joint Conference of Chief Ministers of States and Chief Justices of High Courts” published in PIB on 30th April 2022. 

What is the News?

The Prime Minister is attending the joint conference of Chief Ministers and Chief Justices of High Courts at Vigyan Bhawan in New Delhi.

What are the key highlights from the conference?

The Prime Minister remarked the following at the Conference

Release of Undertrials: There are over 3.5 lakh prisoners in jails today who are undertrials. A majority of these are poor or from ordinary families. There is a committee in every district headed by the district judge to look into this issue and wherever possible bail must be granted to them.

Promote local languages in the courts so that people of the country feel connected with the judicial process and their faith in the same increases. 

Mediation as a tool for Pendency of Cases: Mediation is an important tool for the settlement of pending cases in the courts, especially at the local level. There is a thousand years old tradition of settlement of disputes through mediation in our society. 

The Chief Justice of India remarked the following at the Conference

Reason for Huge Number of Cases: Governments were the biggest litigant accounting for 50% of all cases of which two-thirds related to land acquisitions.

Hence, blaming the legislature and executive, CJI said that if the laws are passed with clarity of thought and people’s welfare in mind, litigation will be minimized.

Improving Judicial Infrastructure: There is an urgent need for improving judicial infrastructure across the country. For this, the CJI proposal included the setting up of the State Judicial Infrastructure Development Authority (SJIDA) with CMs and CJs of HCs as members.

PIL misuse: CJI said the rise in frivolous litigation was a worry, particularly the misuse of the public interest litigation route which often became “personal interest litigation”.

The Law Minister remarked the following at the Conference

The Centrally Sponsored Scheme for the development of Infrastructure Facilities for Judiciary has been extended till 2025-26.

The following initiatives have been taken under the e-court Integrated Mission Mode Project,

– 18,735 courts across the country have been computerized to keep the justice system accessible to the common man through e-filing of cases and hearing through video conferencing.

– National Judicial data grid(NJDG) has been through which lawyers and litigants can access case status information.

– 17 Virtual Courts have been set up in 13 States/UTs which primarily deal with petty traffic offences.

For speedy resolution of commercial cases the Commercial Courts Act, 2015 was passed and again amended in 2018, which led to the establishment of “Dedicated Commercial Courts” for the first time in Delhi, Mumbai, Kolkata and Bengaluru.

APEDA launches gluten-free millet products for all age groups at affordable prices

Sources: The post is based on the article “APEDA launches gluten-free millet products for all age groups at affordable prices” published in PIB on 30th April 2022. 

What is the News?

Agricultural & Processed Food Products Export Development Authority(APEDA) has launched a variety of millet products for all age groups at affordable prices ranging from Rs 5 to Rs 15 at the AAHAR food fair.

What is AAHAR Food Fair?

AAHAR is Asia’s biggest B2B international food and hospitality fair.

Organized by: APEDA and the India Trade Promotion Organization(ITPO).

Purpose: To showcase agricultural and processed food products to the global players in the food and beverages industry as the fair is visited by a large number of importers from different parts of the world.

What has APEDA launched at AAHAR Food Fair?

Millet in Minutes: APEDA has launched a variety of “Millet in Minutes” products under the category of Ready-to-Eat(RTE) such as Upma, Pongal, Khichadi, Noodles, Biryani, etc. This is the first RTE millet product in the market to cater the fast-paced world at their convenience in a healthy way.

Note: The millets are a rich source of protein, fibre, minerals, iron, calcium and have a low glycemic index. In view of this, the government has notified millets as Nutri-cereals in April 2018.

Moreover, in March 2021, the United Nations General Assembly(UNGA) declared 2023 as the International Year of Millets.

Display of GI Products: APEDA has put on display Geographical Indication(GI) agricultural products at AAHAR.The products include: 1) Punjab – Basmati Rice, 2) Karnataka – Gulbarga Tur Dal, 3) Maharashtra – Sangli Raisin, Kolhapur Jaggery, 4) Manipur – Chak-Hao and Kachai Lemon, 5) Mizoram – Ginger and Chili, 6) Sikkim – Large Cardamom, 7) Kerala – Navara Rice, Pokkali Rice, Kaipad Rice, 8) Himachal Pradesh – Kala Jeera, Chulli Oil, 9) West Bengal –  Gobindobhog Rice, Tulaipanji Rice, Banglar Rasgulla, 10) Rajasthan – Bikaneri Bhujia and 11) Odisha – Kandhamal Haladi.

Centre notified second phase of mandatory hallmarking which shall come into force from June 01, 2022

Source: The post is based on the article “Centre notified second phase of mandatory hallmarking which shall come into force from June 01, 2022” published in PIB on 30th April 2022. 

What is the News?

The second phase of the mandatory hallmarking vide Hallmarking of Gold Jewellery and Gold Artifacts (Amendment) Order, 2022 will come into force from June 01, 2022.

What is Hallmarking?

Hallmarking is the accurate determination and official recording of the proportionate content of precious metal in precious metal articles. Hallmarks is thus a guarantee of purity or fineness of precious metal articles.

The principle objectives of Hallmarking are to protect the public against adulteration and to obligate manufacturers to maintain legal standards of fineness. 

The Bureau of Indian Standard(BIS) operates the gold and silver hallmarking scheme in India.

According to the scheme, BIS certified jewellers can get their jewellery hallmarked from any of the BIS recognized Assaying and Hallmarking Centres (A&HC).

Implementation of Mandatory Hallmarking of Jewellery in a Phased Manner

First Phase

In the first phase, gold hallmarking was available only in 256 districts and jewellers having an annual turnover above Rs. 40 lakh will come under its purview.

A certain category of jewellery and items will also be exempted from the mandatory requirement of hallmarking.

Jewellery for international exhibitions and jewellery for government-approved B2B (Business-to-Business) domestic exhibitions will be exempted from mandatory Hallmarking.

Second Phase

The second phase of the mandatory hallmarking will cover additional three caratages of gold jewellery/artifacts viz.20, 23 and 24 carats.

Moreover, 32 new districts have been added under the mandatory hallmarking regime wherein an AHC has been set up post-implementation of the first phase of the mandatory hallmarking order.