Current Affairs Compilations for UPSC IAS Prelims 2022

Mains Oriented Articles

GS Paper 2

• C Raja Mohan writes: At G20, the end of old multilateralism – and the beginning of a new order
• Xi Jinping skipping G-20 Summit a deliberate signal to India, West
• DIY India – The government’s ₹13,000cr proposal to train artisans is a step towards self-reliance
• The implications of expansion of BRICS
• The case for elections in Jammu and Kashmir
• India, that is Bharat: How the Constituent Assembly chose

GS Paper 3

Prelims Oriented Articles (Factly)

Mains Oriented Articles

GS Paper 2

C Raja Mohan writes: At G20, the end of old multilateralism – and the beginning of a new order

News: The article discusses the decline of post-Cold War multilateralism, with Russia and China’s growing conflicts causing challenges. It also highlights India’s growing role in shaping new regional and global partnerships, as seen in recent summits in Jakarta and Delhi.

Why is the post-Cold War era of global cooperation weakening?

Russian Conflicts: Russia’s aggressive actions, particularly the annexation of Ukraine’s Crimean Peninsula in 2014 and its ongoing conflict with Ukraine, have caused significant strain on international relations.

China’s Territorial Ambitions: China’s tensions with neighboring Asian countries, including disputes with India, Japan, the Philippines, and Vietnam, have become sources of concern.

Economic Leverage: China has tried to use the world’s dependence on its economy for political and strategic gains, causing distrust.

Change in Chinese Policies: Xi Jinping’s reversal of policies from the 1980s, which aimed for a peaceful periphery and shared prosperity, has negatively impacted regional and global institutions.

How is Asia responding to China’s actions?

Security Institutions: New security groups like the Quad, which includes India, the US, Japan, and Australia, have been established to counterbalance China’s influence.

AUKUS Pact: The AUKUS alliance, consisting of Australia, Britain, and the US, has been formed as a direct response to China’s increasing military presence.

Questioning ASEAN’s Role: China’s aggressive territorial expansion has led to doubts about the effectiveness of ASEAN-led regional institutions in ensuring stability.

Bilateral Ties: Many Asian countries are strengthening bilateral relationships to deter China’s unilateral moves. For example, the trilateral compact between the US, Japan, and South Korea aims to bolster security in Northeast Asia.

Economic Diversification: Nations like Japan and the US are trying to reduce their economic dependence on China by diversifying trade partnerships.

How is India’s role evolving?

Central Player: India is emerging as a pivotal figure in shaping both regional and global dynamics, highlighted by its active participation in forums like the Indo-Pacific Quadrilateral Forum.

G20’s Evolution: India is pushing for the G20 to address the concerns of the Global South, signaling its desire to play a more substantial role in global economic discussions.

Shifting Alliances: Historically aligned with Moscow and Beijing for a multipolar world, India’s focus has shifted due to China’s increasing assertiveness, leading it closer to nations like Australia, Japan, and the US.

Embracing the Indo-Pacific: India has adopted the Indo-Pacific concept and rejuvenated the Quad alliance to counterbalance China’s influence in the region.

What are the features of India’s new multilateral approach?

Quad Collaboration: At the Jakarta summit, Indian’s PM emphasizes that the Quad complements ASEAN’s efforts and promotes regional stability.

Re-globalisation Focus: External Affairs Minister S Jaishankar advocates for a diversified, democratic globalisation, moving away from a China-centric production model.

Collective Solutions: Despite challenges in multilateralism, India continues to seek collective solutions, focusing on diverse issues like modernising the global tax regime.

Global South Concerns: India prioritizes the concerns of the Global South in the G-20 agenda, aiming to enhance cooperation between developed and developing nations, rather than reviving old confrontational politics.

Xi Jinping skipping G-20 Summit a deliberate signal to India, West

News: Recently, Chinese President Xi Jinping has decided to skip the G20 Summit in Delhi for the first time. Instead, Chinese Premier Li Qiang, the second-ranked leader, will attend the Summit, which is a departure from the usual protocol.

China has also not officially provided any specific reason for this.

What may be the probable reasons behind Chinese President skipping the G20 summit?

Tensions with India: China is unhappy with the current status of its bilateral relations with India, specifically India’s position that achieving normalcy in broader relations requires resolving the situation along the Line of Actual Control (LAC).

China’s decision to skip the summit might be linked to the 2020 border clashes and the ongoing border dispute. The release of a new map by China recently further escalated tensions.

Additionally, China may not want to see India’s G20 presidency succeed, given India’s growing international influence, both strategically and economically.

Domination of the West: China’s decision to skip the G-20 Summit shows its preference for forums like BRICS and the Shanghai Cooperation Organisation (SCO), where it has more influence.

However, this strategy faces challenges, as BRICS is already diverse, and it hasn’t achieved significant results since its formation.

Skipping the summit might also be aimed at reducing the G20’s influence, which China sees as Western-dominated and less appealing. The absence of the Russian President at the G-20 could also put China under more scrutiny.

Another possible reason for Xi’s absence could be to avoid addressing Western leaders’ questions regarding China’s support for Russia.

Politicization: China is unhappy with the politicization of the G-20. It believes that the G-20 should focus solely on economic matters and not get involved in political issues like the conflict in Ukraine.

What may be the consequences of China’s decision?

China’s absence at the G20 summit reduces its significance. India’s presidency at G20 has held discussions on issues like reforming multilateral development banks and addressing debt sustainability in low- and middle-income countries.

China’s cooperation in this regard was critical, as it considers its loans to low-income nations commercial.

Skipping G20 summit could also harm China’s global standing and image as an emerging superpower, making it less predictable and reliable on the global stage.

What is the way ahead?

India will need to engage with China beyond the G20 and accept that diplomatic relations are unlikely to improve soon.

Economic risks due to dependence on Chinese imports remain, so India should carefully handle military and diplomatic issues while decreasing reliance on Chinese imports.

DIY India – The government’s ₹13,000cr proposal to train artisans is a step towards self-reliance

News: Skilled workers like plumbers and carpenters have become difficult to find in India because many leave for better opportunities abroad.

Additionally, there’s a lack of a DIY (Do It Yourself) culture among the middle-class Indians, unlike in the West where people do minor repairs themselves.

Hence, to address this issue, the government is planning to launch a ₹13,000 crore scheme, known as PM Vishwakarma Scheme.

What is the scheme about?

The scheme will train artisans in various manual crafts, including carpentry. It will be launched for five years on Vishwakarma Jayanti (September 17).

In the first year, six lakh families will benefit, with one member receiving a subsidized ₹2 lakh loan to learn a specific craft.

This initiative hopes to supplement the country’s skilled workforce and promote the Gandhian idea of dignifying manual labor. 

Read More: Licence To Skill – GOI’s scheme for craftspeople is a good idea but its success critically depends on finding markets and Vishwakarma scheme will aid 30 lakh artisan families

What are the concerns associated with the scheme?

There is a concern that, like many IIT and other institution graduates, these artisans might also leave for better opportunities abroad, leading to a “Brain Drain” issue.

Hence, this situation highlights the importance of self-reliance; as the saying goes, “If you want a job done, you have to do it yourself.” Like charity, Atmanirbharta begins at home.

The implications of expansion of BRICS

News– The 15th BRICS summit in Johannesburg announced that the five-member grouping had invited six new members from West Asia; Egypt and Ethiopia from Africa, and Argentina from Latin America.

What are some significant positive aspects about the grouping?

Since 2009, BRICS has convened annual summits and is supported by numerous ministerial and expert meetings.

It has established two significant institutions. First is the New Development Bank (NBD), which provides development assistance. Second is the Contingent Reserve Arrangement, designed to aid countries facing short-term balance-of-payments challenges.

The NBD has already funded 96 projects with a total value of $33 billion.

What is the main agenda of BRICS countries?

BRICS member countries have shared discontent with the Western-dominated international institutions that emerged after World War II. These include the World Bank, the International Monetary Fund, the United Nations and, the World Trade Organization.

The United States has led the Western alliance in both political and economic spheres.

BRICS challenges this Western-led world order by promoting economic and political cooperation among its member states,

It is establishing institutions outside of Western control, and advocating strongly for comprehensive reforms to accommodate the interests of emerging economies.

The Johannesburg Declaration explicitly states that the members “strategic partnership” aims to achieve “a more representative, fairer international order.”

How recent expansion of BRICS makes the group more influential?

The recent expansion of BRICS’s membership collectively wields significant economic influence within the enlarged organization.

With the proposed expansion, BRICS will represent 46% of the world’s population. Its share of global GDP will rise from 31.5% in PPP terms to 37%. It is surpassing the GDP share of the G-7, which stands at 30.7%.

The five core BRICS members currently account for 23% of global exports and 19% of global imports. With the addition of new members, these figures will increase by 3.7% and 3%, respectively.

The most significant impact will be on the energy sector. The five original BRICS members currently contribute to 20% of the world’s oil production. This share is set to increase to 42%.

What is the geopolitical importance of BRICS expansion?

Countries from West Asia are already closely intertwined with BRICS members.

China and India receive 35% of Saudi Arabia’s oil production. Russia, a major oil supplier to China and India, is exploring Brazil as a market. Despite U.S. sanctions, Iran has considerably increased its oil production, and most of it going to China.

Egypt and Ethiopia play essential roles in the strategically vital Horn of Africa and the Red Sea region. Argentina holds the position of being the second-largest economy in Latin America.

The recent additions to BRICS, especially those from West Asia, align well with the group’s political and economic framework.

Since 2020, both Saudi Arabia and the UAE have pursued independent foreign policies, distancing themselves from U.S. influence.

Saudi Arabia has pursued de-escalation. It has engaged in dialogue with various countries, including Turkey and Iran. It made China-brokered accord with Iran in March this year.

The UAE has normalized relations with Iran and is expanding its maritime presence across the Gulf, the Gulf of Aden, the Red Sea, and the Horn of Africa.

Iran’s inclusion in BRICS is significant. It opens opportunities for enhanced regional economic cooperation and the revitalization of long-dormant north-south connectivity projects, including the Chabahar port.

What are major takeaways from Johannesburg Declaration?

The Johannesburg Declaration predominantly emphasizes intra-BRICS cooperation and collaboration with other developing nations.

The member nations have agreed to promote the use of local currencies in trade and financial transactions between BRICS countries and other trade partners.

The Declaration demonstrates shared viewpoints among its members on various political matters, such as the United Nations’ significance, regional issues in West Asia, the conflict in Ukraine, and global terrorism.

The case for elections in Jammu and Kashmir

News– Jammu and Kashmir has not conducted legislative elections in the past nine years. The most recent Assembly election occurred in 2014, and the last elected government was dissolved in June 2018.

What are the issues with recommendations of the Delimitation Commission appointed for Jammu and Kashmir?

The recommendations raised two concerns. It allocated six out of seven new seats to Jammu and only one to the Valley. This is deviation from the democratic principle of equal representation.

Despite the Valley having 56.15% of the State’s population, it was assigned 47 seats. Jammu was assigned 43 seats, even though it had 43.85% of the population.

The commission’s redrawing of political constituencies resulted in the concentration of minority voters in fewer districts or their dispersion across multiple districts. It has affected their voting strength.

Changes in residency rules also contributed to an imbalance in constituencies. Before 2019, non-permanent residents were not eligible to vote in Assembly elections.

Following the alteration of Article 370 and the repeal of Article 35A, anyone “ordinarily resident” in the former State became eligible to vote.

It includes those who had been residents for more than 15 years, those who had studied in the region for more than seven years, and those registered as migrants by the Relief and Rehabilitation Commissioner.

What are some facts about new proposed bills for introducing reservation in the J & K assembly?

The Jammu and Kashmir Reorganisation (Amendment) Bill, 2023, allocates two seats for ‘Kashmiri migrants’  and one for individuals displaced from Pakistani-held territories of Jammu and Kashmir. These three seats will be filled by nominees of the Lieutenant-Governor.

The Constitution (Jammu and Kashmir) Scheduled Tribes Order (Amendment) Bill, 2023, is the second Bill. It includes the Pahari community and several small tribes in Jammu and Kashmir’s list of Scheduled Tribes.

This change allows Paharis to compete for reserved seats that were previously dominated by Gujjars and Bakerwals.

The third Bill is the Constitution (Jammu and Kashmir) Scheduled Castes Order (Amendment) Bill, 2023. It adds the Valmiki community to Jammu and Kashmir’s list of Scheduled Castes.

The fourth Bill is the Jammu and Kashmir Reservation (Amendment) Bill, 2023. It includes 15 more other backward classes, such as West Pakistan refugees and Gorkhas.

What are concerns about their practical implementation of these Bills?

Pandit migrants have been elected without reservations for many years, even during times of insurgency and after their exodus. They may not require reserved seats but instead need security when elected.

Gujjars accept Pahari reservation as long as it doesn’t encroach on their quota. But, they have received no such assurance.

Long-term residents like refugees, Gurkhas, and Valmikis should be entitled to vote. But, the question remains whether the former group needs a reserved seat.

Due to these gaps, the Bills can create voter polarisation along caste and community lines in a region with diverse castes and communities.

In Muslim-majority areas, there is concern that the number of their representatives will decrease.

In Jammu, there is suspicion that new reservations are aimed at creating additional support for the Bharatiya Janata Party, particularly in areas where the party’s influence is waning.

Why is holding elections in Jammu & Kashmir and Ladakh necessary?

Most people are now eager for a prompt Assembly election. The centrally-directed administration in Jammu and Kashmir have led to higher unemployment rates and loss of land and resource rights.

Meanwhile, discontent is growing in Ladakh, where the powers of the elected Hill Councils have been greatly reduced by the Lieutenant-Governor’s office. Here too, the demand for Statehood is gaining momentum.

Holding an Assembly election before the end of the year can help rebuild confidence, as past experience has shown.

The Atal Bihari Vajpayee administration conducted elections in 2002, during a period of significant insurgency. However, that election marked the beginning of 12 years of peace-building, with two free and fair elections.

In contrast, the attempt to manipulate the 1987 election resulted in over a decade of armed conflict.

India, that is Bharat: How the Constituent Assembly chose

News– Recently the President’s invite for the G-20 dinner mentioned the “President of Bharat” instead of “President of India”. This has reignited the debate whether India should be renamed as Bharat.

The first debate on Article 1 was to begin on November 17, 1948. However, on the suggestion of Govind Ballabh Pant, the discussion on the name was postponed to a later date.

What were the arguments in favour of giving prominence to Bharat over India in constituent assembly?

Reminder of colonial Past – The use of India over Bharat was seen as a reminder of the colonial past.

Use of Bharat would symbolise actual independence – India name for the newly independent nation did not signify the actual independence. Members who supported the name Bharat took Irish constitution example. Irish Free State was one of the few countries in the modern world which changed its name on achieving freedom and the fourth article of its Constitution refers to the change in the name of the land.

Name of the country as India was foreign imposition – Clinging to the word ‘India’, showed that we are not ashamed of having this insulting word which has been imposed on us by alien rulers.

Name Bharat was befitting to our history and our culture – Vishnu Purana and Brahma Purana mentioned ‘Bharat’. Seventh-century Chinese traveller Hiuen Tsang had referred to the country as Bharat.

What are the arguments against renaming of name India as Bharat?

Cumbersome process – Renaming of names of government institutions to corporate institutions. This will be a cumbersome and tiring process.

Renaming of name would be against the non-theocratic and inclusive state that India symbolises.

Renaming of names will not serve much purpose as all institutions have already Bharat names in their Hindi usage like the RBI and IITs.

Renaming of names is a means of political polarisation between the elite-non-elite, urban-rural and south-north states. It is being used to counter the emerging coalition of I.N.D.I.A by the ruling party.

However, Dr. Ambedkar reminded the House several times that the civilisational debate was unnecessary since the name Bharat was not opposed by members. Dr. Ambedkar was apprehensive of such debates on the name of the country. He was focussed more on development path the country should take.

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The tax base is growing – government shouldn’t waste the opportunity

News: The author discusses the growth in India’s tax base, with more individuals and companies paying taxes, even during slow economic growth. However, despite the increased tax base, the tax to GDP ratio remains stable due to tax rate reductions and other policy decisions, leaving the government with limited additional revenue for its development goals.

What are the reasons for the growth in India’s tax base?

Direct Taxpayer Growth: Companies paying tax surged by 43% from 7.46 lakh in 2014-15 to 10.7 lakh in 2022-23. Individual taxpayers saw a 65% jump from 5.38 crore to 8.9 crore.

Small Taxpayer Inclusion: A significant portion of new taxpayers earn under Rs 5 lakh, making them an essential segment of the expanding tax base.

GST’s Appeal: Active GST payers increased from 1.2 crore in 2019 to 1.4 crore by 2023. The benefits of GST registration, like input tax credits, may have driven more businesses to pay direct taxes.

Formalization of Firms: Approximately 22% of Indian firms are now formally engaged in tax-paying activities.

Economic Expansion & Formalization: The growth in the tax base can be attributed to the economy’s growth. The formalization of the economy has made tax evasion tougher.

Diverse Taxpayer Profile: Not all taxpayers are active in the workforce. Retirees and those earning from interests or rentals also contribute, suggesting a broadened tax base beyond just the active labor force.

What are the challenges still present in India’s tax system?

Lower Tax Revenues: Despite a broader tax base, the government has limited room to spend due to constrained tax revenues.

Stable Tax to GDP Ratio: The growth in the number of taxpayers hasn’t translated into a proportionate increase in the tax to GDP ratio.

Impact of Tax Cuts: The corporate tax rate was cut from 30% to 22%. The resulting revenue loss was Rs 1.28 lakh crore in 2019-20 and Rs 1 lakh crore in 2020-21. The corporate tax to GDP ratio fell from 3.5% in 2018-19 to 3.1% in 2022-23.

Rise in Zero-Tax Individuals: The number of individuals with zero tax liability grew from 2.9 crore in 2019-20 to 5.16 crore in 2022-23. The recent increase in the rebate limit to Rs 7 lakh might further this trend.

Reduced GST Rates: The weighted average GST rate fell from 14.4% during its introduction to 11.6% in 2019 due to tax cuts in 2017 and 2018.

Laws governing forests of the Northeast

News: The article discusses concerns over the Forest (Conservation) Amendment Act, 2023, which allows diversion of forest land near India’s borders without clearance. Special constitutional protections in Northeast India like Article 371A for Nagaland and 371G for Mizoram can restrict certain central laws, including forest-related ones.

What is the controversy about the new act?

Amendment Details: The Forest (Conservation) Amendment Act, 2023 is at the center of controversy. It permits the diversion of forest land within 100 km of India’s international borders for projects without the typical forest clearance.

Area of Concern: A significant portion of Northeast India, including states like Mizoram, lies within this 100 km range, making them directly affected by the amendment.

Mizoram’s Opposition: The Mizoram Assembly unanimously passed a resolution opposing this amendment, aiming to protect the rights and interests of its people.

Constitutional Protections: Northeastern states like Nagaland and Mizoram have special constitutional protections (Article 371A and 371G) that can restrict certain central laws. This creates potential clashes with the new amendment.

Widespread Discontent: It’s not just Mizoram. States like Tripura and Sikkim, which are governed by the ruling party or its allies, also expressed concerns and opposed the 100-km exemption clause in the amendment.

Is the Forest Conservation Act (FCA) relevant to Northeast India?

The FCA, established in 1980, governs the diversion of forest lands for non-forest purposes.

Relevancies of FCA are:

Special Protections: Northeastern states like Nagaland and Mizoram have constitutional protections (Article 371A and 371G) that can restrict some central laws.

Nagaland’s Stance: Although Nagaland once extended the FCA to government forests, it was later deemed non-applicable due to lack of resolution.

Mizoram’s Position: When Mizoram became a state in 1986, all Central Acts including FCA were extended to it, covering 84.53% of its notified forests.

Other States: The FCA is applicable in Meghalaya, Tripura, the Sixth Schedule Areas within these States, and in Arunachal Pradesh, Sikkim, and Manipur, with varying extents of FCA clearances.

What is Recorded Forest Area (RFA)?

Definition: RFA refers to lands that are recorded as forests, regardless of their official classification or ownership.

Coverage: Over half of the Northeast region is categorized as RFA.

Types: RFAs include notified forests and unclassed forests (forests not officially categorized).

Supreme Court Ruling: In 1996, the court expanded “forest land” under the FCA to cover areas recorded as forests in government records, broadening the FCA’s reach to unclassed forests.

Distribution in Northeast: Percentages range, with Assam at 34.21% and Sikkim at 82.31%. Other states like Mizoram and Nagaland have 35.48% and 53.01% RFA, respectively.

How does the FRA Act impact the Northeast region?

The Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act (FRA) 2006 includes various forest classifications, from unclassified to national parks.

Rights Recognition: FRA acknowledges specific rights under state laws, customary laws, and tribal traditions.

Northeast’s Stance: While FRA benefits Northeast due to sizable unclassed forests, only Assam and Tripura have implemented it. Other states claim it’s irrelevant due to existing land ownership structures.

Mizoram’s Shift: Initially, Mizoram extended the FRA in 2009 but retracted in 2019, citing irrelevance as no claims for rights emerged.

What can be done to protect forests?

Measures to Protect Forests:

FRA Implementation: The Environment Ministry, in 2009, emphasized the importance of implementing the Forest Rights Act (FRA) and obtaining prior informed consent from the Gram Sabha before admitting a forest diversion proposal.

Role of District Collector: The District Collector, who heads the committee issuing FRA titles, was tasked with ensuring FRA compliance during the forest clearance process.

Shift in 2022: The Ministry’s 2022 Forest Conservation Rules altered the process, asking states to ensure FRA compliance only after final approval for forest diversion.

State’s Responsibility: States can ensure mandatory FRA fulfillment and Gram Sabha consent before any forest land is handed over for non-forest purposes.

Tribal Affairs Ministry’s Role: This ministry can recognize and settle forest rights when forests are diverted, reinforcing legal security for forest-dwelling communities and forest protection.

Time to decide-Infrastructure development in the hills cannot be the same as in the plains

News: The article discusses concerns about flood damage in north India, with the Chief Justice suggesting a study on the Himalayan region’s sustainability. The Centre proposes a committee to address these concerns, focusing on balancing population growth, infrastructure, and the area’s delicate environment.

What is the “Carrying Capacity”?

The “carrying capacity” is a concept taken from population biology. It refers to the maximum number of a species that can live sustainably in a specific ecosystem without harming it. If the population exceeds this capacity, the environment may get damaged, leading to a natural decrease in species numbers.

What environmental challenges are faced in the Himalayan states?

Population Growth: The Himalayan States struggle to support an increasing number of residents without harming the environment.

Infrastructure Needs: They need roads and buildings, but construction can damage the delicate ecosystem. For example, post the 2013 Uttarakhand floods, road-widening projects continued despite concerns.

Fragile Geography: The region’s unique topography makes development tricky. In January, land issues in Joshimath, Uttarakhand showed this.

Balancing Act: There’s a need to balance between development and preserving the environment. Himachal Pradesh’s recent floods, caused by building on vulnerable mountains, are a case in point.

What are the various proposals to overcome these challenges?

Expert Committee Suggestion: Chief Justice D.Y. Chandrachud recommended an expert committee to conduct a “complete and comprehensive” study on the Himalayan region’s carrying capacity.

Technical Committee Proposal: Following the suggestion, the Centre proposed a 13-member technical committee to delve into the matter.

Carrying Capacity Guidelines: In 2020, the Centre circulated guidelines among the 13 Himalayan States. The goal was to assess the carrying capacity of hill stations, cities, and eco-sensitive zones in these states.

Reminder from Environment Ministry: The Environment Ministry reminded the states in May to undertake the aforementioned study and submit their findings.

RBI’s e-rupee could use UPI for a reformist leap

News– Recently, State Bank of India has integrated UPI with e-rupee wallets designed for holding the RBI’s central bank digital currency.

What are some facts about UPI?

The UPI system is administered by the National Payments Corporation of India. It is a consortium of financial institutions.

The UPI platform is built upon India’s state operated Aadhaar system, which utilises biometric IDs to verify the identities of bank and telecom users.

What are the benefits associated with integrating UPI with e-rupee wallets designed for holding the RBI’s central bank digital currency (CBDC)?

E-rupee holders can now use UPI to conduct swift retail transactions by scanning QR codes. This integration is expected to provide increased liquidity to e-rupees. It could potentially transform UPI in the future.

What will be the potential role of a CBDC with RBI’s e-rupee?

it can be a novel medium for offering a fast, cost-effective, and secure alternative to cumbersome cross-border money transfers. Such adoption would also support economic growth, international trade, and financial inclusion.

From a strategic perspective, using RBI’s digital tokens for trans-border transactions could potentially serve as a barrier against the adoption of cryptocurrencies and capital flight.

What is the significant distinction between CBDC and UPI?

CBDC represents a direct claim on the currency issuer, RBI. These IOUs are backed by RBI’s own guarantee, making them exceptionally secure.

In contrast, UPI relies on the safety of commercial banks participating in the payment process.

Use financial inclusion to reduce inequality and speed up growth

News– The article expalain the contribution of B20 grouping for promoting financial inclusion and challenges in prompting financial inclusion.

What is the contribution of B20 for promoting financial inclusion?

The topic of financial inclusion has been a consistent part of the B20 discussions for an extended period. It all began at the Pittsburgh Summit in 2009 when the Financial Inclusion Experts Group (FIEG) was established.

The Global Partnership for Financial Inclusion (GPFI) was formed at the Seoul Summit in 2011. It was followed by the introduction of a fundamental set of financial inclusion metrics at the Mexico Summit in 2012.

The China Summit in 2016 led to the adoption of high-level principles for digital financial inclusion. At the Indonesia Summit in 2022, an implementation guide for this was provided.

What are challenges in promoting financial inclusion?

According to the 2021 Global Findex Database from the World Bank, approximately 24% of adults worldwide lack access to formal financial accounts.

Only 29% of adults choose to deposit their savings in a financial institution, and a mere 28% of adults borrow from a formal financial institution on a global scale.

MSMEs are also facing growing disparities in obtaining financing. A publication by the World Bank titled “MSME Finance Gap: Assessment of the Shortfalls and Opportunities in Financing MSMEs in Emerging Markets” revealed it.

As per the repost, 21% of micro-enterprises in developing countries face constraints due to loan application rejections or unfavorable loan terms. For small and medium-sized enterprises, this figure rises to 30%.

Globally, women encounter various obstacles accessing basic banking services. It including restrictive social norms, limitations on mobility, lack of identification, and limited financial literacy. This gender disparity is evident in low-income and developing countries.

For example, in Sub-Saharan Africa and the Middle East and North Africa, the gender gap in bank account ownership is 12 and 14 percentage points. It is twice the average gender gap in emerging economies and three times the global average.

In case of digital payments, men with accounts in developing countries are typically 6 percentage points more likely than women to use digital payment methods.

Women also face greater challenges in accessing emergency funds. According to the World Bank’s Findex data from 2021, only 50% of women in developing nations claimed they could consistently access emergency cash, compared to 59% of men.

What is the way forward for financial inclusion?

There are three main pillars to reduce barriers to financial inclusion.

The first pillar focuses on enhancing the ecosystem and facilitators that drive financial inclusion. Challenges such as a lack of innovation in financial services, low financial literacy, limited opportunities for capacity building, and gender-based exclusion can strain ongoing financial inclusion efforts.

To address this, the promotion of private sector engagement in financial inclusion through partnerships is necessary.

There is need for  enhancement of individuals’ and small enterprises’ capacities through incubation and financial literacy programs, and the promotion of gender-inclusive financial services and initiatives.

The second pillar aims to expand the reach of financial products and services. Global insurance penetration remains low at 7% of GDP.

There is also a need to accelerate financial inclusion for agricultural, rural, and migrant populations.

This pillar concentrates on reducing the cost of capital for financial institutions, devising innovative distribution channels for service delivery, and promoting cross-border payments through protocol standardization.

The final pillar strengthens the consumer protection framework to uphold consumer trust in new digital products. It sseks to formulate policies that strike a balance between protection and innovation.

Prelims Oriented Articles (Factly)

Ministry of Tourism in collaboration with the United Nations World Tourism Organization (UNWTO) unveiled the G20 Tourism and SDG Dashboard

Source: The post is based on the article “Ministry of Tourism in collaboration with the United Nations World Tourism Organization (UNWTO) unveiled the G20 Tourism and SDG Dashboard” published in PIB on 6th September 2023

What is the News?

The Ministry of Tourism in collaboration with the United Nations World Tourism Organization (UNWTO), unveiled the G20 Tourism and SDG Dashboard.

What is G20 Tourism and SDG Dashboard?

The G20 Tourism and SDG Dashboard serves as a comprehensive online public platform, amalgamating the collective knowledge of the G20 Tourism Working Group.

It showcases best practices, case studies and insights from G20 countries for achieving the Sustainable Development Goals. 

What is the Goa Roadmap for Tourism?

UNWTO as the knowledge partner of India’s G20 Presidency has developed the Goa Roadmap for Tourism as a Vehicle for Achieving the Sustainable Development Goals. 

The Roadmap is built around the five priority areas of the Tourism Working Group under India’s G20 Presidency: 1. Green Tourism; 2. Digitalization; 3. Skills; 4. Tourism micro-, small and medium-sized enterprises (MSMEs) and 5. Destination Management.

Tourism and the G20 economies: 

The G20 economies represent around 85% of the global GDP, over 75% of the global trade and about two-thirds of the world population.

In 2022, the G20 welcomed 74% of international tourists and 73% of tourism exports worldwide. In 2019, pre COVID-19 pandemic the Tourism Direct GDP reached 3.7% of the G20 economies.

Centre signs MoU with Adobe to train children in classroom

Source: The post is based on the article “Centre signs MoU with Adobe to train children in classroom” published in The Hindu on 6th September 2023

What is the News?

The Union Ministry of Education has partnered with Adobe, a global software company, to promote creative expression in classrooms using Adobe Express.

What is Adobe Express?

Adobe Express is an AI-first, all-in-one, quick and easy content creation app with generative AI capabilities, that allows users to create content like posters, animated videos, web pages, PDFs and more.

What is the purpose of the partnership between the Union Ministry of Education and Adobe?

Aim: To provide training and certification in creativity and digital literacy to about 20 million students and five lakh teachers by 2027 using Adobe Express-based curriculum. 

Under the programme, Adobe will provide schools across the country with free access to Adobe Express Premium and professional development of educators.

– Curriculum, training and certification based on Adobe Express tools and capabilities will be rolled out to empower students and educators with topics covering creativity, generative AI, design, animation, video and other emerging technologies.

– Educators will receive Adobe Creative Educators certification upon completion of training. 

Significance: The initiative will help in empowering students with the tools and resources to develop future-ready skills on creativity, critical thinking, communication and collaboration, and empower educators with critical skills required to inspire creative classrooms.

TRAI releases recommendations on “Issues related to FM Radio Broadcasting”

Source:  The post is based on the article “TRAI releases recommendations on “Issues related to FM Radio Broadcasting” published in PIB on 6th September 2023

What is the News?

The Telecom Regulatory Authority of India(TRAI) has released its recommendations on issues related to FM radio broadcasting including private FM Radio operators.

What are the recommendations given by TRAI to address issues related to FM radio broadcasting?

Firstly, extend the existing FM license period of 15 years by 3 years.

Secondly, private FM radio operators should be allowed to broadcast news and current affairs programs, limited to 10 minutes in each clock hour.

Thirdly, annual license fee of a FM radio channel should be de-linked from non-refundable one-time entry fee and the license fee should be calculated as 4% of the Gross Revenue (GR) of the FM radio channel during the respective financial year. 

Fourthly, the Government may take appropriate measures to provide relief to the FM radio operators to address challenges posed due to COVID-19 pandemic.

Fifthly, functions or features pertaining to FM radio should remain enabled and activated on all mobile handsets having the necessary hardware.Built-in FM radio receivers in mobile handset must not be subjected to any form of disablement or deactivation.

Sixthly, a Standing Committee, headed by a senior officer of Joint Secretary or above level, to oversee and monitor the compliance by mobile phone manufacturers (or importers) may be established by the Ministry of Electronics and Information Technology(MeitY) .

Lastly, an online grievance redressal portal should be provided for submitting information or complaints of case of any non-compliance as regards enablement of FM radio functionality in such mobile handsets that have the necessary functionality for FM receivers.

FM flags threats to financial system from crypto, tax havens

Source: The post is based on the article “FM flags threats to financial system from crypto, tax havens” published in The Hindu on 6th September 2023

What is the News?

The Finance Minister has addressed the delegates at the Global Fintech Fest (GFF) 2023 being held in Mumbai.

What are the key highlights from the Finance Minister’s address at the Global Fintech Fest (GFF) 2023?

Source: The Hindu

Global Financial Threats: Cryptocurrency, drug mafias, tax havens, and cyber threats are significant global financial threats.Collaboration is needed to address these challenges effectively.

Cryptocurrencies offer opportunities but they also pose threats.Hence, efforts are needed to regulate and address issues related to crypto assets.

Fintech Industry: Fintech industry in promoting financial inclusion and influencing India’s financial landscape.Fintechs have played a substantial role in lending and reaching out to new customers.

– The Finance Minister urged fintech companies to invest heavily in cybersecurity measures, including advanced encryption, to protect user data and financial transactions. Security is crucial for building trust in the financial ecosystem.

Cross-Border Payments: India’s priority, under its G20 presidency, includes enhancing cross-border payment arrangements, especially considering the volume of remittances to the country.

Unclaimed Deposits: According to RBI, balances in savings or current accounts which are not operated for ten years, or term deposits not claimed within ten years from the date of maturity are classified as unclaimed deposits.

– Banking system alone is estimated to hold over Rs 35,000 crore in unclaimed deposits.

– To facilitate the recovery of these unclaimed funds, the Reserve Bank of India (RBI) had recently launched UDGAM (Unclaimed Deposits – Gateway to Access information) central web portal. 

Jal Jeevan Mission Achieves Milestone of 13 Crore Rural Households Tap Connections

Source: The post is based on the article “Jal Jeevan Mission Achieves Milestone of 13 Crore Rural Households Tap Connections” published in PIB on 6th September 2023

What is the News?

The Jal Jeevan Mission (JJM) has achieved another milestone of providing tap water connections to 13 Crore rural households. 

What is the Jal Jeevan Mission (JJM)?

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What is the progress made under Jal Jeevan Mission (JJM)?

Jal Jeevan Mission (JJM) has achieved the milestone of providing tap water connections to 130 million rural households.

The rural tap connection coverage has increased from 32.3 million households at the start of the mission in 2019 to 130 million in just four years.

Currently, Goa, Telangana, Haryana, Gujarat, Punjab, Himachal Pradesh, Puducherry, Dadra and Nagar Haveli and Daman and Diu and Andaman and Nicobar Islands have reported 100% coverage.

Every second, one tap water connection is installed, thus changing the country’s rural landscape.Since January 1,2023 around 87,500 tap connections have been provided every day.

Tap water supply has been provided to 915,000 (88.73%) schools, and 952,000 (84.69%) anganwadi centers in the country.

The mission has also successfully resolved the issue of Arsenic and Fluoride contamination in drinking water sources providing safe drinking water in affected habitations.

‘Green Hydrogen Pilots in India’ Conference held in the run-up to G20 Summit

Source: The post is based on the article “Green Hydrogen Pilots in India Conference held in the run-up to G20 Summit” published in PIB on 6th September 2023

What is the News?

“Green Hydrogen Pilots in India” conference was held in New Delhi.

What is the Green Hydrogen Pilots in India conference?

Hosted by: NTPC Limited 

Purpose: The conference showcased various Green Hydrogen Pilots being implemented by both public and private sector companies of India.

What are the key highlights from the conference?

India’s commitment to green hydrogen sets it apart from countries using natural gas-based hydrogen with higher emissions.India aims to be an influential exporter and a leader in the green hydrogen approach.

India’s carbon dioxide contribution is relatively low compared to its population, reflecting its dedication to environmental concerns.The shift toward green hydrogen aligns with the goals of energy independence and environmental responsibility.

India intends to become a refueling destination for green ships by providing affordable green hydrogen or green ammonia.Collaboration with the Ministry of Shipping is in progress.

The National Green Hydrogen Mission’s pilot projects are the driving force behind innovation and experimentation.They target sectors traditionally reliant on fossil fuels.

The R&D roadmap for the National Green Hydrogen Mission is nearly finalized and will be released soon.It outlines research areas needed for green hydrogen development.

Public and private sectors are also implementing several pilot projects in green hydrogen, contributing to the growth of the green hydrogen ecosystem.

Scientists fabricated optically active flexible biodegradable polymer-nanocomposite films

Source: The post is based on the article “Scientists fabricated optically active flexible biodegradable polymer-nanocomposite films” published in PIB on 6th September 2023

What is the News?

Researchers have developed a biodegradable nanocomposite film for Flexible Optical Devices.

What are Polymers?

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What is the importance of Polymers?

Polymers have become important in our daily lives finding applications in various industries. 

However, the demand for highly flexible and optically active polymers has led researchers to explore new materials and methodologies.

The nanomaterials are known to enhance the properties of the polymers keeping the inherent properties of the polymers intact.

Scientists have reported that polyvinyl alcohol (PVA) is one of the most widely studied synthetic biodegradable polymers having good film-forming and excellent mechanical properties.Its optical and mechanical properties can be tuned by incorporating suitable nanomaterials.  

What have the researchers developed?

Researchers have developed an optically active biodegradable nanocomposite film with excellent mechanical properties.

This innovation could pave the way for the development of flexible displays and organic LEDs, revolutionizing the field of optical technology. 

The biodegradable nature of the material also aligns with sustainability goals, making it a promising candidate for various future applications.

UPI QR Code-Central Bank Digital Currency interoperability: How does it work and how do customers benefit?

Source: The post is based on the article “UPI QR Code-Central Bank Digital Currency interoperability: How does it work and how do customers benefit?” published in Indian Express on 6th September 2023

What is the News?

Several banks are enabling the interoperability of Unified Payments Interface’s (UPI) Quick Response (QR) code with their Central Bank Digital Currency(CBDC) or e₹ application.

What is Interoperability?

Interoperability is the technical compatibility that enables a payment system to be used in conjunction with other payment systems.

It allows system providers and participants in different systems to undertake, clear and settle payment transactions across systems without participating in multiple systems.

What is QR Code?

A QR code consists of black squares arranged in a square grid on a white background, which can be read by an imaging device such as a camera.QR contains information about the item to which it is attached.

QR code is an alternate contactless channel of payments.It allows merchants or businesses to accept payments from their customers directly into their bank accounts.

What is UPI QR code-CBDC interoperability?

Interoperability of UPI with the digital rupee means all UPI QR codes are compatible with CBDC apps. 

Initially, when the pilot for the retail digital rupee was launched, the e₹-R users had to scan a specific QR code to undertake transactions. 

However, with the interoperability of the two, payments can now be made using a single QR code.

How will this benefit customers and merchants?

The interoperability of UPI and CBDC will ensure seamless transactions between a customer and merchant without having the need to switch between multiple digital platforms.

It will allow a digital rupee user to make payments for their daily needs, such as groceries and medicines, by scanning any UPI QR codes at any merchant outlet.

Even merchants are not required to keep a separate QR code to accept the digital rupee payments.They can accept CBDC payments on their existing QR code.

How will interoperability help in increasing CBDC adoption?

Currently, UPI is a widely used payment method and the interoperability between it and the CBDC will propel the adoption of the digital rupee.

New Covid-19 variant may be ‘reason to worry’: What is known about ‘Pirola’ so far

Source: The post is based on the article “New Covid-19 variant may be ‘reason to worry’: What is known about ‘Pirola’ so far” published in Indian Express on 6th September 2023

What is the News?

An article published in the Yale Medicine Review has noted the rise of Covid-19 infections in multiple countries driven by a new Coronavirus variant called BA.2.86 which is informally being termed ‘Pirola’.

What is Pirola?

Pirola is a newly designated highly mutating Omicron variant of Covid-19 virus.

It was first spotted in Denmark and has now spread to other countries like the US, Canada and Israel.

Pirola differs from previous variants of Omicron as it has more than 30 spike protein mutations.This gives it the capacity to be immune, evasive and highly transmissible.

It is currently in the WHO list of  ‘variants under monitoring’.

How do viruses mutate, exactly?

It is natural for all viruses to mutate over time and such changes are particularly common in viruses that have RNA as their genetic material as in the case of coronaviruses and influenza viruses.

Once a virus enters the human body, its genetic material — RNA or DNA — enters the cells and starts making copies of itself which can infect the other cells.Whenever an error occurs during this copying process, it triggers a mutation.

Occasionally, a mutation comes along when the genetic mistakes that are introduced while copying prove to be advantageous for the virus — these help the virus copy itself or enter human cells more easily. 

Whenever a virus is widely circulating in a population, the more it spreads and replicates, its chances of mutating increases.

Biodiversity loss: 37,000 ‘alien species’ introduced by human activities, says report

Source: The post is based on the article “Biodiversity loss: 37,000 ‘alien species’ introduced by human activities, says report” published in Indian Express on 6th September 2023

What is the News?

Intergovernmental Platform on Biodiversity and Ecosystem Services (IPBES) has released a publication titled “Assessment Report on Invasive Alien Species and their Control’’.

What are Invasive Alien species?

Source: IPBES

Invasive alien species are plants, animals, pathogens and other organisms that are non-native to an ecosystem, and which may cause economic or environmental harm or adversely affect human health. 

In particular, they impact adversely upon biodiversity, including decline or elimination of native species – through competition, predation, or transmission of pathogens – and the disruption of local ecosystems and ecosystem functions.

What are the key findings of IPBES report on Invasive Alien species?

Number of Introduced Alien Species: There are 37,000 alien species introduced by human activities worldwide.

– Over 3,500 of these alien species pose significant global threats to nature, economy, food security, and human health.

Most widespread invasive alien species: The water hyacinth is the world’s most widespread invasive alien species on land. 

– Lantana, a flowering shrub and the black rat are the second and third most widespread globally. The brown rat and the house mouse are also widespread invasive alien species.

Not all alien invasive species have negative impacts: Not all alien species establish and spread with negative impacts on biodiversity, local ecosystems and species but a significant proportion do.

– About 6% of alien plants; 22% of alien invertebrates; 14% of alien vertebrates; and 11% of alien microbes known to be invasive pose major risks to nature and to people.

– Nearly 80% of the documented impacts of invasive species on nature’s contribution to people are negative.

What is the impact of Invasive Alien species?

Impact on Biodiversity: Invasive alien species are a major driver of biodiversity loss, contributing to 60% of global plant and animal extinctions.

– They are one of the five major direct drivers of biodiversity loss globally alongside land and sea-use change, direct exploitation of organisms, climate change, and pollution. 

Economic Impact: The annual costs of invasive alien species have at least quadrupled every decade since 1970, as global trade and human travel increased.In 2019, the global economic cost of invasive alien species exceeded $423 billion annually.

Impact on Food Supply: The reduction of food supply is the most common impact of alien invasive species.For example, the European shore crab impacting commercial shellfish beds in New England or the Caribbean false mussel damaging locally important fishery resources in Kerala, by wiping out native clams and oysters.

Spreads Diseases: Invasive alien species like Aedes albopictus and Aedes aegyptii spread diseases such as malaria, Zika and West Nile Fever.

Amplify impact of Climate Change: Invasive alien species can also amplify the impacts of climate change.For example, invasive alien plants, especially trees and grasses, can sometimes be highly flammable and promote more intense fires.

What has been the response of countries against Invasive Alien species?

Most countries (80%) have included targets related to managing invasive alien species in their national biodiversity plans.

However, only 17% specifically address the issue in national legislation.Nearly half of all countries (45%) do not invest in management of biological invasions.

Recently, countries have  agreed to reduce the rate of introduction and establishment of invasive alien species by at least 50% by 2030 under Target 6 of the Kunming-Montreal Global Biodiversity Framework.

The following today’s current affairs articles have been covered in 7 PM Explained section of the day:

7 PM Editorial of the day: Modern Threats to Indian Financial System – Explained, pointwise