9 PM UPSC Current Affairs Articles 23rd January, 2025

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Mains Oriented Articles

GS PAPER - 1

Unlocking India’s Critical Minerals Potential

Source: This post on Unlocking India’s Critical Minerals Potential has been created based on article “The oligarchy we see today” published in The Hindu on 23rd January 2025.

UPSC Syllabus topic: GS Paper 1- Distribution of Key Natural Resources across the world

Context: The article discusses China’s strategic use of export controls on critical minerals, which are essential for advanced technologies like semiconductors, aerospace, and batteries. It highlights China’s calculated approach to controlling mineral exports, balancing its economic interests with geopolitical goals. In contrast, the article examines India’s challenges in building a robust critical minerals ecosystem despite having significant mineral potential, as evidenced by lithium deposits in Jammu and Kashmir.

What recent export restrictions has China introduced?

  1. On January 2, 2025, China’s Ministry of Commerce (MOFCOM) added 28 U.S. entities to its export control list.
  2. The restrictions target minerals critical for high-tech applications, including tungsten, gallium, magnesium, beryllium, hafnium, and lithium-6.

How has China historically used its mineral exports as a strategic tool?

  1. China has repeatedly weaponized critical mineral exports, targeting minerals essential to Western nations, especially for semiconductors, batteries, and advanced electronics.
  2. Examples include:
    1. The rare earth minerals embargo against Japan (2010).
    2. Restrictions on antimony, gallium, and germanium exports.
    3. A ban on rare earth extraction and processing technologies (2023).
  3. China avoids controlling minerals heavily reliant on Western raw material imports.
  4. It refrains from measures that could harm domestic industries or export-driven sectors.

 What is India’s current status in critical minerals development?

  1. India discovered lithium deposits in Jammu and Kashmir’s Reasi district in 2023, but no company has shown interest in bidding for the resources.
  2. Only 48% of the mineral blocks offered for auction have been successfully auctioned.

What steps has the Indian government taken to boost critical minerals development?

  1. Identified 30 critical minerals essential for national security.
  2. Established Khanij Bidesh India Ltd. (KABIL) to secure overseas investments in critical minerals like lithium and cobalt.
  3. Passed the Mines and Minerals (Development and Regulation) Amendment Act, 2023, removing restrictions on certain rare earth elements.

How has the 2023 amendment aimed to improve exploration?

  1. Introduced an ‘exploration license’ to attract specialized exploration firms, including foreign players.
  2. Enabled firms to focus on reconnaissance and prospecting without committing to full-scale mining.
  3. Promised reimbursement of 50% of exploration expenditure once mining begins.

Why have these reforms not yielded significant results?

  1. Only a few exploration licenses for minerals like lithium and rare earth elements have been issued, mostly to public sector firms.
  2. Foreign participation remains minimal, and mining license auctions have stalled.
  3. Outdated resource classification systems and insufficient geological data make exploration riskier for potential bidders.

 How can India improve its critical minerals exploration?

  1. Focus on high-quality geological surveys to reduce information asymmetry between the government and mining companies.
  2. Offer larger upfront fiscal incentives during the exploration phase instead of reimbursing costs only after production begins.
  3. Both sectors involve high upfront costs and long timelines for profitability.
  4. India’s aggressive capital support for semiconductor fabrication could be replicated for critical minerals exploration to offset early costs and attract investment.

What should India’s approach be?

  1. India must address systemic issues, including outdated exploration methods and limited fiscal incentives, to unlock the potential of its critical minerals sector.
  2. Adopting a semiconductor fabrication-style model for critical minerals could boost domestic exploration, mining, and exports, aligning with the country’s strategic goals.

GS PAPER - 2

Is the Government Encouraging ‘Crosspathy’?

Source: This post on Crosspathy Controversy in India has been created based on article “Is the Government Encouraging ‘Crosspathy’?”  published in The Hindu on 23rd January 2025.

UPSC Syllabus topic: GS Paper 2- Issues Relating to Development and Management of Social Sector/Services relating to Health, Education, Human Resources.

Context: The article examines the Maharashtra Food and Drugs Administration’s (FDA) recent directive permitting homeopathic practitioners with a certificate in modern pharmacology to prescribe allopathic medicines. It discusses the challenges to this directive, particularly from the Indian Medical Association (IMA), which argues that it contradicts a Bombay High Court stay order and the Supreme Court’s stance on ‘crosspathy.’ What directive has the Maharashtra Food and Drugs Administration issued?

What is the background of this issue?

  1. In 2017, the Maharashtra Medical Education and Drug Department permitted homeopathic practitioners holding the Licentiate of the Court of Examiners of Homeopathy (1951-1982) to practise modern medicine.
  2. This notification was challenged in the Bombay High Court by the Indian Medical Association (IMA), leading to a stay on the directive.

 Why is the directive being opposed?

  1. The IMA argues that:
    1. Even the central regulatory body for homeopathy does not allow its practitioners to prescribe allopathic medicines.
    2. The Supreme Court has banned ‘crosspathy,’ categorizing it as medical negligence.
    3. The FDA lacks the authority to issue such a directive, especially since the court’s stay remains in effect.
  2. The IMA fears risks to patients’ safety if homeopathic practitioners are allowed to prescribe allopathic medicines without proper qualifications.

What has the Supreme Court ruled on crosspathy?

  1. In the 1996 Poonam Verma vs. Ashwin Patel case, the Supreme Court held a homeopath liable for negligence after prescribing allopathic medicine, leading to a patient’s death.
  2. The judiciary views cross-system practice as medical negligence unless explicitly authorized by state governments.

Why is the Central government promoting AYUSH medicine?

  1. India faces a significant shortage of doctors, particularly in rural areas.
  2. AYUSH practitioners are being integrated to fill healthcare gaps and improve accessibility in underserved regions.
  3. As of June 2022:
    1. 13,08,009 allopathic doctors are registered in India.
    2. 65 lakh AYUSH doctors are available.
  4. The Health Dynamics of India 2022-23 report highlights an 80% shortage of specialist doctors in rural community health centres.

What are experts saying about integrating alternative medicine practitioners?

  1. Public health experts emphasize the importance of structured integration of mid-level providers.
  2. Allowing unregulated cross-system practice may lead to chaos in the healthcare system.
  3. While promoting AYUSH practitioners is seen as a solution to doctor shortages, their roles need clear regulations to maintain healthcare standards.

The Rise and Influence of Oligarchy in Modern Democracies

Source: This post on The Rise and Influence of Oligarchy in Modern Democracies has been created based on article “The oligarchy we see today” published in The Hindu on 23rd January 2025.

UPSC Syllabus topic: GS Paper 2 – International relations

Context: The article explores the concept and evolution of oligarchy, emphasizing its contemporary relevance and implications for democracy. It begins by addressing U.S. President Joe Biden’s warning about a “tech industrial complex” and a new Gilded Age of oligarchs threatening American democracy.

What warnings have been made about oligarchy in the U.S. recently?

  1. In his farewell remarks, U.S. President Joe Biden warned of an emerging oligarchy threatening American democracy.
  2. Biden highlighted a “tech industrial complex,” akin to Dwight Eisenhower’s 1961 warning about the “military-industrial complex.”
  3. Biden cautioned about a new Gilded Age of “robber barons” eroding freedoms.
  4. Theodore Roosevelt, a U.S. President in the early 1900s, combated similar challenges by trust-busting and creating regulatory agencies.

How is oligarchy currently visible in the U.S.?

  1. Political and economic power are intertwined, as seen in Donald Trump’s cabinet, which included 13 billionaires.
  2. Elon Musk, the first individual with a net worth exceeding $400 billion, supported Trump’s campaign with $200 million and proposed public spending cuts.
  3. Billionaires from industries like fossil fuels, tech, and others (e.g., Jeff Bezos, Tim Cook, and Mark Zuckerberg) were prominently present at Trump’s inauguration and have federal government contracts.

 What is the origin of the term oligarchy? How do oligarchs operate and adapt?

  1. The term was coined by Aristotle to describe the rule of a wealthy few “for corrupt and unjust purposes.”
  2. Oligarchs often gain power through financial means, social standing, or connections in politics, religion, or the military.
  3. Jeffrey A. Winters, in his book Oligarchy (2011), explained that oligarchs defend their wealth by using power and influence.
  4. Their involvement varies depending on threats to their interests.

How has oligarchy evolved over time?

  1. Modern oligarchs, like Michael Bloomberg, use private funds to secure political positions, unlike historical oligarchs such as Marcus Licinius Crassus, who sought political power for survival.
  2. Oligarchs today focus more on vanity and influence than survival.
  3. Oligarchy becomes dangerous when oligarchs:
    • Violate the rule of law.
    • Remove checks and balances on their power.
    • Prioritize personal interests over the people’s welfare.

 What are some examples of oligarchies globally?

  1. Philippines: Powerful families dominate due to its colonial past.
  2. China: Despite calling itself a communist republic, power is concentrated in a few hands.
  3. Russia: Wealthy businessmen with political influence are often referred to as oligarchs.
  4. United States: Bernie Sanders pointed out that oligarchs run both Russia and the U.S.

Can democracy counter oligarchy?

  1. Aristotle, in Politics, argued democracy is safer and less prone to conflict than oligarchy.
  2. However, sociologist Robert Michels’ “iron law of oligarchy” posits that democracies inevitably transform into oligarchies due to labor division.

What risks does oligarchy pose today?

  1. John Adams feared the rise of a “power elite” over 200 years ago.
  2. Today, economic power concentrated through technological advancements, like AI, is intensifying oligarchic tendencies globally.

India lagging behind in AI innovation

Source: The post India lagging behind in AI innovation has been created, based on the article “Why Neutral Expert’s decision on Indus Waters Treaty is a win for India” published in “Indian Express” on 23rd January 2025

UPSC Syllabus Topic: GS Paper2- International relations-India and its neighbourhood- relations.

Context: The article discusses how the Neutral Expert appointed by the World Bank confirmed his authority to judge the disputes between India and Pakistan concerning two hydroelectric projects under the Indus Waters Treaty. This decision supports India’s position that the disputes fall within his jurisdiction.

For detailed information on Indus Water Treaty read this article here

What is the Indus Waters Treaty (IWT)?

  1. The Indus Waters Treaty was signed on September 19, 1960, by India and Pakistan after nine years of negotiations arranged by the World Bank.
  2. It determines the distribution of the waters of the Indus River and its tributaries.
  3. India has “unrestricted use” of the Eastern Rivers (Beas, Ravi, Sutlej), and Pakistan controls the Western Rivers (Indus, Chenab, Jhelum).
  4. India gets 30% of the total Indus River System water, while Pakistan gets 70%.

What is the ongoing dispute?

The dispute concerns the design of two hydroelectric projects in Jammu and Kashmir:

  1. Kishenganga Hydroelectric Project (HEP) on the Kishenganga (a tributary of the Jhelum).
  2. Ratle Hydroelectric Project (HEP) on the Chenab.
  3. Both are “run-of-the-river” projects, meaning they generate electricity without obstructing river flow.
  4. Pakistan claims these projects violate the Treaty, but India maintains they comply with IWT provisions.

How was the dispute handled?

  1. In 2015, Pakistan requested a Neutral Expert but withdrew its request in 2016, opting for arbitration at the Permanent Court of Arbitration (PCA).
  2. India rejected the PCA mechanism and insisted on resolving differences through the Neutral Expert as per the IWT’s graded dispute resolution system.
  3. The World Bank initiated both processes in October 2022: appointing a Neutral Expert (Michel Lino) and launching PCA proceedings.

What is the Neutral Expert’s role and decision?

  1. The Neutral Expert upheld India’s position that the differences on the two projects fall under his jurisdiction.
  2. He decided to hear the merits of the case after visiting the project sites in June 2023.
  3. India boycotts the PCA proceedings, calling them inconsistent with the Treaty, but engages with the Neutral Expert process.
  4. It confirms India’s stand that the Neutral Expert is competent to resolve the dispute.
  5. This outcome is favorable for India at this stage as the matter remains within Treaty-aligned mechanisms.

What is the future of the IWT?

  1. India has issued two notices to Pakistan:
  • January 2023 Notice: Sought modification of the Treaty due to Pakistan’s repeated objections.
  • September 2024 Notice: Cited changes in demographics, environmental challenges, clean energy goals, and cross-border terrorism as reasons to review the Treaty.
  1. These notices invoke Article XII (3), which allows the Treaty to be modified by mutual agreement.

Key Takeaway

The Neutral Expert’s decision strengthens India’s stand in the dispute. However, India’s push for Treaty review and modification suggests possible renegotiation in response to modern challenges like clean energy and security concerns.

Question for practice:

Evaluate how the decision of the Neutral Expert supports India’s position in the ongoing disputes under the Indus Waters Treaty.

GS PAPER - 3

US AI Chip Export Rules Affect India

Source: The post US AI Chip Export Rules Affect India has been created, based on the article “What is U.S.’s new rule for exporting AI chips?” published in “The Hindu” on 23rd January 2025

UPSC Syllabus Topic: GS Paper3- Science and Technology- Awareness in the fields of IT, Space, Computers, robotics, nano-technology, bio-technology and issues relating to intellectual property rights.

Context: The article discusses new U.S. regulations on exporting advanced AI technology and chips. It divides countries into three tiers with different rules. India and China fall under the second tier, requiring authorization for certain AI-related transactions. The goal is to protect U.S. security.

For detailed information on US Restrictions on AI Chips and Its Impact on India read  Article1, Article2

What Technology is Being Regulated by U.S?

  1. The U.S. Bureau of Industry and Security (BIS) is regulating the following technologies:
  • Advanced Computing Chips: These are integral for running sophisticated AI operations and data processing.
  • AI Model Weights: Specific configurations and setups of AI models that dictate how data is processed and the quality of outputs.
  1. The regulations update how these technologies are exported, re-exported, or transferred within countries. They categorize countries into three tiers:

Tier 1: Includes 18 allies like the U.K. and Canada, with no restrictions.

Tier 2: Includes China and India, requires authorizations for certain transactions.

Tier 3: Includes countries like North Korea and Iran, which are barred from accessing the technology.

What Are the Concerns About These Regulations?

  1. Impact on U.S. Global Competitiveness: Critics argue that the regulations might undermine the innovation that has kept the U.S. ahead in the tech sector. For example, Ned Finkle from NVIDIA expressed concerns that controlling widely available technology does not enhance U.S. security.
  2. Availability of Alternative Suppliers: Ken Glueck of Oracle noted that the rules ignore the existence of non-U.S. chip suppliers. He argues that companies can achieve the same performance by sourcing GPUs from alternative suppliers like Huawei and Tencent, thus undermining the effectiveness of the regulations and impacting U.S. competitiveness in the global market.

How Do These Rules Impact India?

  1. Requirement for Authorization: Indian companies must obtain Validated End User (VEU) authorization to use exported advanced AI chips for both civilian and military purposes, excluding nuclear applications.
  2. Impact on Data Centers: Large Indian data centers that want to deploy these advanced technologies will need to navigate these new bureaucratic hurdles to speed up their operations.
  3. Exclusion from Trusted Allies: India is notably absent from the list of trusted allies and partners, likely due to concerns over past technology leakages to countries like Russia.

Question for practice:

Discuss how the new U.S. regulations on exporting advanced AI technology and chips impact India’s technology sector.

India lagging behind in AI innovation

Source: The post India lagging behind in AI innovation has been created, based on the article “Basic technology R&D: Let’s wake up before it’s too late” published in “Live mint” on 23rd January 2025

UPSC Syllabus Topic: GS Paper3– Science and Technology – Developments and their applications and effects in everyday life.

Context: The article highlights India’s missed opportunity in foundational AI research, focusing instead on adapting existing models. It emphasizes the need for bold investment in speculative research to avoid dependency on foreign technology and ensure competitiveness in emerging industries.

For detailed information on Major concerns of AI use in India read this article here

Why is India lagging behind in AI innovation?

  1. Missed foundational research opportunities: India focused on adapting existing AI models instead of creating new ones, despite having talent and resources when transformer models emerged 2–3 years ago.
  2. Low research output: India produces only 10% of the AI research papers compared to China or the US.
  3. Dependency on foreign technology: Heavy reliance on foreign intellectual property leads to costly licensing, cloud fees, and hardware imports.
  4. China’s rapid advancements: Chinese firms developed efficient, versatile models supporting multiple languages, including Indian ones, while India remains focused on local adaptations.
  5. Lack of bold investment: Limited funding for speculative, foundational research hinders innovation.

Why is foundational research critical for India’s future?

  1. Global Competitiveness: Without foundational breakthroughs, India risks being overshadowed by foreign models, even in local applications like Indian language AI.
  2. Missed Opportunities: India skipped foundational research in transformer models despite having talent, producing only 10% of China or the US’s AI research papers.
  3. High Costs of Dependency: Relying on foreign technology increases licensing, cloud, and hardware expenses, making AI a forex absorber.
  4. Shaping Future Industries: Foundational research enables leadership in AI-driven fields like robotics and autonomous vehicles.

What needs to change for India to lead in AI?

  1. India must fund speculative research without fixed end goals.
  2. Bold experimentation in AI model development can lead to transformative breakthroughs.
  3. Visionary leaders and financial backing for foundational research are essential.
  4. Investing now will ensure India’s leadership in future technologies.

Question for practice:

Examine the reasons behind India’s lag in foundational AI research and its implications for the country’s future competitiveness.

Urbanization affecting groundwater

Source: The post urbanization affecting groundwater has been created, based on the article “Address India’s worsening urban groundwater crisis” published in “Live mint” on 23rd January 2025

UPSC Syllabus Topic: GS Paper3-Conservation, Environmental Pollution and Degradation, Environmental Impact Assessment

Context: The article highlights India’s groundwater crisis, with contamination and over-extraction worsening due to urbanization, fertilizer use, and poor sewage management. It calls for sustainable water management through advanced technologies, decentralized wastewater treatment, rainwater harvesting, and circular water economy initiatives.

For detailed information on India’s Annual Groundwater Quality Report 2024 read this article here

Why is groundwater important?

  1. Groundwater is a critical source of urban water supply worldwide, supporting nearly half the urban population.
  2. Aquifers store larger water volumes than artificial reservoirs, ensuring water availability during droughts.
  3. For example, the Ogallala Aquifer in the US supplied 500 cubic kilometers of water in 40 years, exceeding Egypt’s Lake Nasser.
  4. Groundwater is often cleaner than surface water, as aquifers naturally protect it from contamination.
  5. It ensures reliable water supply, especially in regions with limited surface water resources or during periods of irregular rainfall.

How is urbanization affecting groundwater?

  1. Urbanization is drastically impacting groundwater due to increased water demand and inadequate sewage treatment infrastructure.
  2. By 2036, India’s urban population is expected to surge to 600 million, intensifying the strain on groundwater resources.
  3. Urban areas, contributing 70% to India’s GDP, face significant water management challenges.
  4. Of 712 surveyed districts, 102 are overexploited with groundwater extraction rates exceeding 100%.
  5. Specifically, urban centers in Punjab, Delhi, Haryana, and Karnataka are experiencing nearly depleted groundwater levels, highlighting the critical need for improved water management and conservation practices.

What are the main causes of groundwater contamination?

  1. Excessive Fertilizer Use: Leads to nitrate contamination; 20% of groundwater samples in India have nitrate levels exceeding 45 mg/l, with some districts over 40%.
  2. Poor Waste Management: Urban areas lack sewage treatment, as in 2021, only 31,841 MLD of sewage was treated out of 72,368 MLD generated.
  3. Arsenic Contamination: Severe in states like West Bengal, Uttar Pradesh, and Assam.
  4. Fluoride Pollution: Found in over 9% of groundwater samples.
  5. Urbanization Impact: Impervious surfaces hinder recharge, and untreated sewage pollutes rivers and aquifers.

What solutions can improve groundwater management?

  1. Circular water economy:
  • Use decentralized wastewater treatment systems at community levels.
  • Reclaim water for non-drinking purposes and extract nutrients like nitrogen and phosphorus.
  1. Technology-driven solutions:
  • IoT sensors and AI can monitor water quality and predict contamination trends.
  • These tools can streamline water distribution and improve wastewater treatment.
  1. Rainwater harvesting and aquifer recharge:
  • Cities should adopt rainwater harvesting and artificial aquifer recharge to conserve water.

What are India’s existing initiatives for water conservation?

  1. The Jal Shakti Abhiyan focuses on rainwater harvesting and groundwater recharge.
  2. The AMRUT 2.0 programme promotes effective urban water management.
  3. Unified and Model Building Bye Laws prioritize water conservation in urban planning.

For detailed information on Groundwater Use and Governance in India read this article here

How can India ensure water sustainability?

  1. India should scale up localized strategies like decentralized treatment and rainwater harvesting.
  2. Regular monitoring and advanced technologies will enhance the impact of existing initiatives.
  3. By adopting innovative solutions, cities can secure safe groundwater and long-term water sustainability.

Question for practice:

Examine the impact of urbanization on groundwater resources in India and suggest sustainable solutions for addressing the challenges.

Prelims Oriented Articles (Factly)

Dhanauri Wetland

News: The Principal Bench of the National Green Tribunal (NGT) has directed the Uttar Pradesh government to inform it of the status of notifying the Dhanauri waterbody as a wetland. 

About Dhanauri Wetland

Dhanauri Wetland
Source- The Indian Express

 

  • It is in the Dhanauri village near Dankaur in Uttar Pradesh. 
  • It is nestled within the floodplains of Yamuna Basin. 
  • The wetland hosts more than 217 bird species, including over 150 Sarus Cranes. 
    • Sarus Crane is the state bird of Uttar Pradesh. 
  • The wetland has over 20,000 waterfowl, and supports 23 species of birds that are endangered, critically endangered and threatened. 
  • It has been recognised as an Important Bird Area by Bird Life International. 
  • Dhanauri is yet to be recognised as a Ramsar site. 
About Ramsar Convention 

  • It is an intergovernmental treaty that provides the framework for national action and international cooperation for the conservation and wise use of wetlands and their resources. 
  • The convention was signed in Ramsar (Iran) in 1971 under the auspices of UNESCO and came into force in 1975. 
  • Article 1.1 of the Ramsar Convention defines wetland as “areas of marsh, fen, peatland or water, whether natural or artificial, permanent or temporary, with water that is static or flowing, fresh, brackish or salt, including areas of marine water the depth of which at low tide does not exceed six metres”. 
  • It recognises 5 major types of wetlands: marine, estuarine, lacustrine, riverine and palustrine. 

Mission SCOT

News: The Prime Minister has congratulated Digantara for the successful launch of Mission SCOT (Space Camera for Object Tracking). 

About Mission SCOT

Mission SCOT
Source- The Economic Times

 

  • It is the world’s first commercial satellite for surveillance of Resident Space Objects (as small as 5cm) orbiting the Earth to ensure safer space operations. 
  • Surveillance of Outer Space or Situational Space Awareness (SSA) gains paramount importance to ensure the safety of spacecrafts. 
  • It aims to improve space safety, optimise traffic management and strengthen national security initiatives. 
  • The SCOT satellite has been launched onboard SpaceX Transporter-12 mission. 
  • SCOT will be deployed in a sun-synchronous orbit. This will enable it to track objects in Low Earth Orbit (LEO) with greater efficiency as compared to the existing sensors. 

Kalaripayattu

News: The relegation of Kalaripayattu to the demonstration section of the 38th edition of the National Games has sparked off a political storm. 

About Kalaripayattu

Kalaripayattu
Source- The Indian Express
  • It is one of the oldest and most scientific martial art forms in the world based on the ancient knowledge of the human body. 
  • It originated in Kerala. Myths credit the warrior sage Parasurama with establishing Kalarippayattu.  
  • The term Kalaripayattu is combination of two Malayalam words: Kalari (meaning training ground) and Payattu (meaning training of martial arts). 
  • The martial art involves 4 stages: 
    • Maippayattu- It is the body conditioning phase where the person is taught to prepare their body for a fight. 
    • Kolthari- In the second stage, a person is taught attack and self-defence with the help of wooden weapons. 
    • Angathari- In this stage, sharp metal objects are introduced after the person overcomes the fear of fighting with wooden weapons. 
    • Verumkai- Research based bare hand fighting is emphasised in this stage to teach students body anatomy. The purpose is to make the person aware of what points they can hit and what they cannot. 
  • There are two types of Kalaripayattu: 
    • Northern: In comparison to the southern type, more weapons are used, and all movements are in straight line- forward and backward. 
    • Southern: The participants can move in any direction while practicing it. 
  • It is said that Kalarippayattu was introduced in China by Bodhidharma in the 5th century AD. 
  • The martial art was added to the National List of Intangible Cultural Heritage of India in 2009. 

Diamond Imprest Authorisation

News: The Department of Commerce, Government of India, has introduced Diamond Imprest Authorisation (DIA) Scheme for the duty-free import of natural cut and polished diamonds. 

About Diamond Imprest Authorisation 

Diamond Imprest Authorisation
Source- Business Standard
  • It aims to enhance the global competitiveness of India’s diamond sector by providing a streamlined mechanism for duty free import of natural cut and polished diamonds, leading to value addition and boost in exports. 
  • The scheme has been introduced under the Foreign Trade Policy 2023.  
  • Key Features: 
    • Duty-free import of Natural Cut and Polished Diamonds, of less than ¼ Carat (25 Cents). 
    • Export Obligation: Mandating export obligation with a value addition of 10%. 
    • Eligibility: All Diamond exporters holding Two Star Export House status and above and having US $15 Million exports per year. 
    • The scheme does not cover the Lab Grown Diamonds (LGD). 
  • Potential Benefits: 
    • Providing a level playing field for Indian diamond exporters (particularly MSME exporters) to enable them to compete effectively. 
    • Generating more employment opportunities in the diamond sector. 
    • Encouraging the domestic diamond processing industry by facilitating ease of doing business and increasing the export of cut and polished diamond from India. 

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