ECONOMY
HERKINS
Why is it relevant for prelims 2023?
India emerges as largest exporters of cucumber and gherkins in the world.
https://pib.gov.in/PressReleasePage.aspx?PRID=1791893
Gherkins
Gherkin is a term generally used to refer to a savory pickled cucumber. Gherkins and commercial cucumbers belong to the same species (Cucumis sativus) but are from different cultivar groups
Gherkin cultivation, processing and exports started in India during the early 1990s with a modest beginning in Karnataka and later extended to the neighbouring states of Tamil Nadu, Andhra Pradesh and Telangana.
Nearly 15% production of the world’s gherkin requirement is grown in India.
Gherkins is currently exported to more than 20 countries, with major destinations being North America, European countries and Oceanic countries
SPECIAL ECONOMIC ZONE
Why is it relevant for UPSC Prelims 2023?
New legislation to replace special economic zones act.
https://www.pib.gov.in/PressReleasePage.aspx?PRID=1794135
What is a Special Economic Zone?
An SEZ is a part of a country that is usually duty-free and has its own set of business and commercial rules, with the goal of attracting investment and creating jobs.
In 2005, the Special Economic Zones Act was passed. In 2006, the Act and the SEZ Rules went into effect.
About 64 percent of the SEZs are located in five states – Tamil Nadu, Telangana, Karnataka, Andhra Pradesh and Maharashtra.
The apex body is the Board of Approval, which is led by the Secretary of Commerce (Ministry of Commerce and Industry).
A committee led by Baba Kalyani was constituted to evaluate India’s present SEZ policy.
CENTRAL BANK DIGITAL CURRENCY
Why is it relevant for UPSC Prelims 2023?
Introduction of central bank digital currency ‘digital rupee’ announced.
https://pib.gov.in/PressReleasePage.aspx?PRID=1794160
More about CBDC.
A CBDC is the legal tender issued by a central bank in a digital form. It is the same as a fiat currency and is exchangeable one-to-one with the fiat currency. Only its form is different.
A CBDC is an electronic record or digital token of a country’s official currency, which fulfils the basic functions as a medium of exchange, unit of account, store of value, and standard of deferred payment.
CBDCs should be exchangeable at par with cash.
For this the RBI submitted a proposal to the government for a change to the Reserve Bank of India Act, 1934, to broaden the definition of “banknote” to encompass money in digital form.
CBDCs are distinct from decentralized virtual currencies and crypto assets, which are not issued by the government and do not have the status of “legal cash,” while being directly inspired by Bitcoin.
Benefits of CBDC.
Payments using CBDCs are final and thus reduce settlement risk in the financial system.
CBDC will eliminate the need for interbank settlement.
It will enable the user to conduct both domestic and cross border transactions which do not require a third party or a bank.
Remember!
The e-Naira, the first CBDC outside the Caribbean, was introduced by Nigeria as the most recent CBDC.
BLUE REVOLUTION
Why is it relevant for UPSC Prelims 2023?
The Blue Revolution scheme of the Department of Fisheries, Ministry of Fisheries, Animal Husbandry and Dairying and its progressive outcomes were discussed in the Parliament.
https://pib.gov.in/PressReleasePage.aspx?PRID=1795559
About the scheme
It was implemented for a period of five years as a centrally sponsored scheme.
The purpose of the scheme was to increase the inland and marine productivity of fisheries through financial assistance and multidimensional activities.
Overall growth and adequate funding have been reported in the last five years.
The PMMSY (Pradhan Mantri Matsya Sampada Yojana) has provided a major boost to the objectives of the blue revolution.
- NATIONAL LAND MONETIZATION CORPORATION
Why is it relevant for Prelims 2023?
The Union Cabinet, chaired by Prime Minister Shri Narendra Modi has approved the setting up National Land Monetization Corporation (NLMC) as a wholly owned Government of India company with an initial authorized share capital of Rs 5000 crore and paid-up share capital of Rs 150 crore.
Key details about NLMC
NLMC will undertake monetization of surplus land and building assets of Central Public Sector Enterprises (CPSEs) and other Government agencies.
The proposal is in pursuance of the Budget Announcement for 2021-22.
With monetization of non-core assets, Government would be able to generate substantial revenues by monetizing unused and under-used assets.
About NLMC
NLMC is also expected to own, hold, manage and monetize surplus land and building assets of CPSEs under closure and the surplus non-core land assets of Government owned CPSEs under strategic disinvestment.
This will speed up the closure process of CPSEs and smoothen the strategic disinvestment process of Government owned CPSEs.
In the context of governance, consider the following: (2010)
Encouraging Foreign Direct Investment inflows
Privatization of higher educational Institutions
Down-sizing of bureaucracy
Selling/offloading the shares of Public Sector Undertakings
Which of the above can be used as measures to control the fiscal deficit in India?
(a) 1, 2 and 3
(b) 2, 3 and 4
(c) 1, 2 and 4
(d) 3 and 4 only
Q. Which of the following statements best describes the term ‘Scheme for Sustainable Structuring of Stressed Assets (S4A)’, recently seen in the news? (2017)
(a) It is a procedure for considering ecological costs of developmental schemes formulated by the Government.
(b) It is a scheme of RBI for reworking the financial structure of big corporate entities facing genuine difficulties.
(c) It is a disinvestment plan of the Government regarding Central Public Sector Undertakings.
(d) It is an important provision in ‘The Insolvency and Bankruptcy Code’ recently implemented by the Government.
Q. Which of the following statements best describes the term ‘Scheme for Sustainable Structuring of Stressed Assets (S4A)’, recently seen in the news? (2017)
(a) It is a procedure for considering ecological costs of developmental schemes formulated by the Government.
(b) It is a scheme of RBI for reworking the financial structure of big corporate entities facing genuine difficulties.
(c) It is a disinvestment plan of the Government regarding Central Public Sector Undertakings.
(d) It is an important provision in ‘The Insolvency and Bankruptcy Code’ recently implemented by the Government.
PM-DevINE
Why is it relevant for Prelims 2023?
PM-DevINE scheme was announced in the Budget 2022-23 by the Finance Minister under PM Gati Shakti Plan.
About the Scheme
Prime Minister’s Development Initiative for North East (or PM-DevINE) has been announced in Union Budget 2022-23, which will fund infrastructure in the spirit of PM Gati Shakti, and social development projects based on felt needs of the North-East.
PM-DevINE will enable livelihood activities for youth and women by filling the gaps in various sectors, but it will not be a substitute for existing Central or State schemes.
An initial allocation of Rs. 1,500 crore has been made, as per Budget speech for 2022-23.
The scheme aims to fund infrastructure and need-based social development, including one-of-a-kind ‘Bamboo Link Roads’ in Mizoram.
The PM-DevINE scheme will be implemented through North Eastern Council (NEC).
Bamboo Link Roads will be constructed in Mizoram, under the PM-DevINE scheme.
These roads will help in transporting bamboo from forests
FINCLUVATION: INDIA POST PAYMENTS BANK (IPPB)
Why is it relevant for Prelims 2023?
Recently, the India Post Payments Bank (IPPB) launched the Fincluvation Platform to promote innovative solutions in collaboration with fintech startups to accelerate financial inclusion among the underserved and unserved population.
https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1818635
What is Fincluvation?
Fincluvation will be a permanent platform of IPPB to co-create inclusive financial solutions with participating start-ups.
IPPB and the Department of Post (DoP) collectively serve close to 430 million customers through post offices and at their doorsteps via more than 4,00,000 Post Office employees and Gramin Dak Sevaks – making it one of the largest and most trusted postal networks in the world.
It is an industry-first initiative to create a powerful platform to mobilize the start-up community toward building meaningful financial products aimed at financial inclusion.
BREED-WISE REPORT OF LIVESTOCK AND POULTRY
Why is it relevant for UPSC Prelims 2023?
The Union Minister of Fisheries, Animal Husbandry and Dairying released the Breed-Wise Report on Livestock and Poultry.
https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1824647
Breed-Wise Report of Livestock and Poultry
The report is based on the 20th Livestock Census conducted in 2019.
This marks the first time in the country that breed wise data was collected by using tablet computers instead of paper mode.
The livestock and the poultry birds were counted based on their breeds as recognized by the National Bureau of Animal Genetic Resources (NBAGR).
According to the report, the Exotic and Crossbred animals account for nearly 26.5% of the total cattle population whereas 73.5% are indigenous cattle.
As per the report, the total number of indigenous cattle reduced by 6% to 14.21 crores in 2019 from 15.12 crores in 2012. During the same period, their share in the total cattle population fell from 79% to 73%.
Maximum decline in their numbers: Khariar , Kherigarh , Kenkatha , Motu and Hariana.
Highest population in terms of absolute number: Gir cattle breed had the highest population of 68.57 lakh followed by Lakshmi and Sahiwal cattle breeds.
FIRST LAVENDER FESTIVAL
Why is it relevant for UPSC Prelims 2023?
Recently, India’s First Lavendar festival was inaugurated in Jammu’s Bhaderwah.
https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1828547
Lavender Revolution
Lavender cultivation has generated employment for about 5,000 farmers and young entrepreneurs in Jammu & Kashmir remote areas.
Over 1,000 farming families cultivate it on 200 acres.
The Purple or Lavender Revolution was launched in 2016 by the Union Ministry of Science & Technology through the Council of Scientific & Industrial Research (CSIR) Aroma Mission.
Lavender cultivation on is practised in almost all the 20 districts of Jammu & Kashmir.
Under the mission, first-time farmers were given free lavender saplings, while those who had cultivated lavender before were charged Rs. 5-6 per sapling.
Aim: To support the domestic aromatic crop-based agro-economy by moving from imported aromatic oils to homegrown varieties.
Products
The main product is Lavender oil which sells for at least Rs. 10,000 per litre. Lavender water, which separates from lavender oil, is used to make incense sticks.
Hydrosol, which is formed after distillation from the flowers, is used to make soaps and room fresheners.
WORLD BEE DAY
Why is it relevant for UPSC Prelims 2023?
The Ministry of Agriculture and Farmers’ Welfare (MoA&FW) is celebrating World Bee Day. Earlier, the Khadi and Village Industries Commission (KVIC) had launched the country’s first Mobile Honey Processing Van at Village in Uttar Pradesh.
https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1826702
More about World Bee Day
The day marks the birth anniversary of Anton Janša, a pioneer of modern apiculture.
Anton Janša hailed from a family of beekeepers in Slovenia, where beekeeping is an important agricultural activity with a long-standing tradition.
Anton enrolled in the first bee-keeping school in Europe and worked full-time as a beekeeper.
His book ‘Discussion on Bee-keeping’ was also published in German.
Theme for 2022: Bee Engaged: Celebrating the diversity of bees and beekeeping systems.
FOREIGN INVESTMENT FACILITATION PORTAL
Why is it relevant for UPSC Prelims 2023?
Recently, Foreign Investment Facilitation Portal (FIFP) completed 5 years since the Union Cabinet’s decision to abolish Foreign Investment Promotion Board (FIPB).
https://pib.gov.in/PressReleasePage.aspx?PRID=1827889
About Foreign Investment Facilitation Portal (FIFP)
It is the new online single-point interface of the Government of India for investors to facilitate Foreign Direct Investment.
It is administered by the Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce & Industry.
It will continue to facilitate the single window clearance of applications which are through the approval route.
Routes through which India gets FDI
Automatic Route: In this, the foreign entity does not require the prior approval of the government or the RBI.
Government route: In this, the foreign entity has to take the approval of the government.
SINGLE NODAL AGENCY (SNA) DASHBOARD
Why it is relevant for UPSC Prelims 2023?
Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman to launch of Single Nodal Agency (SNA) Dashboard during the Iconic Week Celebrations of Azadi Ka Amrit Mahotsav celebrations of Ministry of Finance, in New Delhi.
https://pib.gov.in/Pressreleaseshare.aspx?PRID=1831876
About the Dashboard
The SNA Dashboard forms part of a major public financial management reform that was initiated in 2021 with regards to the manner in which funds for Centrally Sponsored Schemes (CSS) are released, disbursed and monitored.
This revised procedure, now referred to as the SNA model, requires each State to identify and designate a SNA for every scheme.
All funds for that State in a particular scheme will be credited in this bank account, and all expenses will be made by all other Implementing Agencies involved from this account.
The SNA model, therefore, ensures that allocation of funds to States for the CSS are made in a timely manner and after meeting various stipulations.
The Dashboard depicts releases made to different States by Ministries, further releases made by State Treasuries to the SNA accounts, expenditure reported by the agencies, interest paid by banks to SNA accounts etc. in intelligible, informative and visually appealing graphics.
The programme will also have presentations on ‘Best Practices in Cash Management through SNA and Treasury Single Account (TSA)’.
NETRA (New e-Tracking and Remote Administration)’ Portal
Why it is relevant for UPSC Prelims 2023?
Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman will launch the Iconic Day celebrations of the Department of Economic Affairs at Vigyan Bhawan, New Delhi.
https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1831915
Market Ka Eklavya
NSDL’s outreach initiative ‘Market Ka Eklavya – Express’, a programme specially designed to introduce students to the basics of investing and financial markets will be screened during the event.
‘Market Ka Eklavya – Express’ lays the foundation of the twin pillars of Financial Independence, namely, Financial Awareness and Financial Discipline in a simple language using relatable examples from everyday life to explain complex concepts.
NETRA
The New E-tracking and Remote Administration (NETRA) platform has been developed with the objective of efficient management and monitoring of the LOC and Concessional Finance Projects extended by Export-import Bank of India.
NETRA is developed to further enhance the speed of delivery of the LOCs by capturing project specific developments that offers need based access to key Indian stakeholders, including the Indian Missions abroad.
The platform will facilitate in the implementation cycle, project monitoring and reporting by providing all relevant information to the key Indian stakeholders in an automated environment.
RBI TO INCREASE CREDIT FLOW THROUGH COOPERATIVE BANKS
Why it is relevant for UPSC Prelims 2023?
The Union Minister for Home and Cooperation, Shri Amit Shah, has welcomed the important steps announced by RBI to increase credit flow through Cooperative Banks.
https://www.pib.gov.in/PressReleseDetailm.aspx?PRID=1832644
Measures taken by RBI
The individual housing loan limit for Urban Co-operative Banks has been doubled.
With this decision, the individual housing loan limit for Tier 1 Urban Cooperative Banks (UCBs) has now been increased from ₹ 30 lakh to ₹ 60 lakh, for Tier 2 UCB from ₹ 70 lakh to ₹ 1.40 crore and for Rural Cooperative Banks (RCBs).
The limit has been increased from 20 lakhs and 30 lakhs to 50 lakhs and 75 lakhs respectively.
Rural Co-operative Banks (RCBs) have been allowed to lend to the Commercial Real Estate Residential Housing sector, which will increase the scope of our Rural Co-operative Banks and also give impetus to the resolution of providing affordable houses to the people.
Now Urban Co-operative banks have been allowed to provide door step banking facility to their customers like commercial banks.
NIRYAT PORTAL
Why it is relevant for UPSC Prelims 2023?
Prime Minister Shri Narendra Modi will inaugurate the new premises of the Ministry of Commerce and Industry – ‘Vanijya Bhawan’.
https://www.pib.gov.in/PressReleasePage.aspx?PRID=1836516
Key facts to remember
He will also launch a new portal – NIRYAT (National Import-Export Record for Yearly Analysis of Trade) – which is developed as a one stop platform for stakeholders to get all necessary information related to India’s foreign trade.
The Vanijya Bhawan is designed as a smart building which incorporates the principles of sustainable architecture with a special focus on energy saving.
It will serve as an integrated and modern office complex that will be used by the two Departments under the Ministry i.e. Department of Commerce and Department for Promotion of Industry and Internal Trade (DPIIT).
BHARAT GAURAV TRAIN
Why it is relevant for UPSC Prelims 2023?
The inaugural Bharat Gaurav train, connecting destinations associated with Ramayana Circuit in India and Nepal, arrived in Nepal’s Janakpur with 500 tourists from India.
https://theprint.in/world/first-bharat-gaurav-train-arrives-in-nepals-janakpur/1009152/
Facts about Bharat Gaurav Train
The Bharat Gaurav Tourist Train between India and Nepal will provide an opportunity to people from across the countries to explore the architectural, historical and cultural marvels of the country. The train started its first Shri Ramayana Yatra for 18 days from June 21.
First trip of the train will also cover the religious destination of Janakpur (in Nepal), apart from other popular destinations like Ayodhya, Nandigram, Varanasi, Sitamarhui, Chitrakoot, Prayagraj, Hampi, Pancvati (Nasik), Rameshwaram and Bhadrachalam.
Ministry of Tourism in coordination with Ministry of Railways and Indian Railway Catering and Tourism Corporation (IRCTC) has also proposed Bharat Gaurav Tourist Trains for Buddhist Circuit, Krishna Circuit, and many other circuits.
Bharat Gaurav trains is an attempt of showcasing the rich spiritual, cultural, and historical heritage of India to its people.
NATIONAL CONFERENCE ON MILLETS
Why it is relevant for UPSC Prelims 2023?
Union Minister of State for M/o Food Processing Industries, Shri Prahlad Singh Patel inaugurated the National Conference on Millets on the theme ‘The Future Super Food for India’ in New Delhi, organised by industry body ASSOCHAM with the support of M/o Food Processing Industries.
https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1836530
Millet & it’s importance
The Millets have been among the oldest eatables in the country.
It is a crop grown from small seeds which can be grown well in dry areas or even on lands with deficient and low fertility thus is known as the superfood of India.
Millets can develop from seeds to ready-to-harvest crops in just about 65 days and this characteristic of the millets is of vital importance in thickly populated regions of the world.
If stored properly, millets can keep well for two years or beyond.
The major millets producing states in India include Haryana, Uttar Pradesh, Chhattisgarh, Gujarat, Rajasthan, Madhya Pradesh, Maharashtra, Andhra Pradesh, Karnataka, Tamil Nadu and Telangana.
India is now the 5th largest exporter of millets globally.
The year 2023 will be the international year of millets that will create value generation and promotion of sustainable products in food choices.
ECONOMY AND AGRICULTURE
FINANCIAL SERVICES INSTITUTIONS BUREAU
News – Government has transformed Banks Board Bureau (BBB), the headhunter for directors of state-owned banks and financial institutions, into Financial Services Institutions Bureau (FSIB).
About Financial Services Institutions Bureau
Constituted effective from July 01, 2022
Purpose – recommend persons for appointment as whole-time directors and non-executive chairpersons on the Boards of financial services institutions and for advising on certain other matters relating to personnel management in these institutions.
The Secretariat of the Bureau currently comprises of Secretary and four officers.
Guidelines for selection of general managers and directors of public sector general insurance companies have been made part of FSIB.
About Banks Board Bureau
Set up in 2016
Body of eminent professionals and officials to make recommendations for appointment of whole-time directors as well as non-executive chairpersons of public sector banks (PSBs) and state-owned financial institutions.
It was also entrusted with the task of engaging with the board of directors of all PSBs to formulate appropriate strategies for their growth and development.
Financial Services Institutions Bureau | An Autonomous Body of Government of India (fsib.org.in)
WINDFALL TAX
News – The Centre slapped a windfall tax on domestic crude oil producers in efforts to reduce pressure on the rupee, rein in the current account deficit (CAD), and increase the domestic supply of petroleum products.
A windfall tax is a higher tax rate levied by governments against certain industries when economic conditions allow those industries to experience above-average profits.
When any industry benefits from an event or a one-off external situation that they were not responsible for and make sudden profits, these profits are taxed separately, over and above the normal taxes that these companies pay to the governments.
Source: https://timesofindia.indiatimes.com/business/india-business/explained-what-is-windfall-profit-and-why-has-it-been-imposed-on-oil-and-gas-companies/articleshow/93919507.cms
CRITICAL MINERALS
News – India and Australia decided to strengthen their partnership in the field of projects and supply chains for critical minerals. India-Australia Critical Minerals Investment Partnership.
About Critical minerals
These are elements that are the building blocks of essential modern-day technologies.
These minerals are now used everywhere from making mobile phones, computers to batteries, electric vehicles and green technologies like solar panels and wind turbines.
Graphite, lithium and cobalt are used for making EV batteries
Rare earths are used for making magnets
Silicon is a key mineral for making computer chips and solar panels
Aerospace, communications and defense industries rely on several such minerals for manufacturing fighter jets, drones, radio sets and other critical equipment
These critical resources are key to the ecosystem that fuels the transition towards clean energy. World is fast shifting from a fossil fuel-intensive to a mineral-intensive energy system.
2019 USGS Mineral Commodity Summaries report, China is the world’s largest producer of 16 critical minerals.
About KABIL or the Khanij Bidesh India Limited
A joint venture of three public sector companies – NALCO, HCL and MECL
To ensure mineral security of the nation and to attain self-reliance
KABIL is mandated to identify and acquire overseas mineral assets of critical and strategic nature such as Lithium, Cobalt etc.
India-Australia critical minerals investment partnership – joint investment for lithium and cobalt projects in Australia
About Minerals Security Partnership (MSP)
It is a US-led initiative to bolster critical mineral supply chains.
The goal of the MSP is to ensure that critical minerals are produced, processed, and recycled in a manner that supports the ability of countries to realize the full economic development benefit of their geological endowments.
MSP partners – USA, Australia, Canada, Finland, France, Germany, Japan, the Republic of Korea, Sweden, the United Kingdom, the United States, and the European Commission.
The MSP will focus on the supply chains of minerals such as Cobalt, Nickel, Lithium, and also the 17 ‘rare earth’ minerals.
https://www.pib.gov.in/PressReleasePage.aspx?PRID=1810948
Minerals Security Partnership – United States Department of State
PLATFORM OF PLATFORMS (POP)
News – The Union Minister of Agriculture and Farmers Welfare launched the Platform of Platforms (POP) under the National Agriculture Market (e-NAM)
About Platform of Platforms
It was launched under the National Agriculture Market (e-NAM)
41 service providers from different platforms are covered under POP facilitating various value chain services like trading, quality checks, warehousing, fintech, market information, transportation etc.
Service Providers include Composite Service Providers, Logistics Service Provider, Quality Assurance Service Provider, Cleaning, Grading, Sorting & Packaging Service Provider, Warehousing Facility Service Provider, Agricultural Input Service Provider, Technology Enabled Finance & Insurance Service Provider, Information Dissemination Portal and other platforms (e-commerce, international agri-business platforms, barter, private market platforms etc.).
e-NAM integrates the platform of Service Providers as “Platform of Platforms”
Benefits
With the introduction of POP, farmers will be facilitated to sell the produce outside their state borders.
Increase farmers’ digital access to multiple markets, buyers and service providers
Bring transparency in business transactions with the aim of improving price search mechanism and quality commensurate price realisation.
The inclusion of various service providers enables farmers, FPOs, traders and other stakeholders to access a wide variety of goods and services across the agricultural value chain through a single window.
Source: https://pib.gov.in/PressReleasePage.aspx?PRID=1841544
LANDLORD PORT MODEL
News – Jawaharlal Nehru Port becomes first 100% Landlord Major Port of India
JNP has become the first major port of the country to become 100% Landlord port having all berths being operated on PPP model.
About Landlord Port
In landlord ports, publicly governed port authority or the state is responsible for port planning, acts as regulatory body, and owns port-related land and basic infrastructure.
Operations are carried out by the port operator. The infrastructure is typically leased to the private operating companies.
The construction of the port, purchasing the necessary equipment to provide safe navigation, faster turnaround time for both ships and trucks become a responsibility of the port operator.
The port authority has limited interference in the port activities.
About Jawaharlal Nehru Port (JNP)
JNP is ranked 26th among the top 100 global ports.
Currently, five container terminals are operated at JNP, of which only one is port owned.
Source: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1842587
Public Private Partnerships in Ports / Port Reform Public Private Partnership (worldbank.org)
INDIA INTERNATIONAL BULLION EXCHANGE (IIBX)
News – Prime Minister launched India’s first International Bullion Exchange (IIBX)’ in Gujarat, the first of its kind in the country.
Bullion
Bullion refers to physical gold and silver of high purity that is often kept in the form of bars, ingots, or coins.
Bullion can sometimes be considered legal tender and is often held as reserves by central banks or held by institutional investors.
Who can trade on the IIBX?
Qualified jewellers will be permitted to import gold through the IIBX and set up the infrastructure to store physical gold and silver.
Non-resident Indians and institutions are able to participate after registering with the IFSCA
Jewellers will be able to transact on IIBX as trading members or as clients of a trading member.
A qualified jeweller based in India and not having physical presence in the IFSC may apply for a limited-purpose trading membership — where the entity can only trade on its own account and no client on boarding shall be permitted.
Qualified jeweller
To become qualified jewellers, entities require a minimum net worth of Rs 25 crore and 90% of the average annual turnover in the last three financial years through deals in goods categorized as precious metals.
Trading member
For becoming a trading member, a qualified jeweller may establish a branch or a subsidiary in IFSC and apply to the IFSCA.
Advantages of having a bullion exchange in India
The IIBX will be a gateway for bullion imports into India, where all bullion imports for domestic consumption shall be channelized through the exchange.
It provides a trading avenue to various participants
A bullion exchange will offer the advantages of price discovery, transparency in disclosures, guaranteed centralised clearing and assurance of quality.
A bullion exchange is an important step towards financialization of bullion-based products.
IIBX ensures sourcing integrity of the bullion delivered by mandating compliance to Organisation for Economic Cooperation and Development (OECD) Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas.
Additional points
India International Bullion Holding (IFSC) will operate India International Bullion Exchange.
The exchange will be an additional platform for gold imports into the country, in addition to banks and nominated agencies.
It will also give an option to trade gold and silver in US dollar.
Since GIFT City is a free trade zone, no duty will be paid.
For the first time in India, since the liberalisation of gold imports through nominated banks and agencies in the 1990s, the eligible qualified jewellers in India have been allowed to directly import gold through IIBX.
ONE NATION ONE FERTILISER
News – Ministry of Chemicals and Fertilisers announced that it has been decided to implement One Nation One Fertiliser by introducing a “Single Brand for Fertilisers and Logo”
Under the Ministry of Chemicals and Fertilisers
One Nation One Fertiliser is under the fertiliser subsidy scheme named “Pradhanmantri Bhartiya Janurvarak Pariyojna” (PMBJP)
The single brand name for UREA, DAP, MOP and NPK etc. would be BHARAT UREA, BHARAT DAP, BHARAT MOP and BHARAT NPK etc. respectively for all Fertiliser Companies, State Trading Entities (STEs) and Fertiliser Marketing Entities (FMEs).
A logo indicating Fertiliser subsidy scheme namely Pradhanmantri Bhartiya Janurvarak Pariyojna will be used on said fertiliser bags.
Under the new “One Nation One Fertiliser” scheme, companies are allowed to display their name, brand, logo and other relevant product information only on one-third space of their bags. On the remaining two-thirds space, the “Bharat” brand and Pradhanmantri Bharatiya Jan Urvarak Pariyojana logo will have to be shown.
This scheme applies to both public & private sector companies.
Source: What is the One Nation One Fertiliser scheme? (indianexpress.com)
OFF-BUDGET BORROWINGS
News – The Centre on Wednesday relaxed norms for adjusting states’ off-budget loans.
About Off-budget borrowings
Off-budget borrowings refer to loans taken by state government entities, special purpose vehicles, etc, where principal and interest would be repaid from state government’s own budget, instead of the cash flows or revenues generated by the borrowing entity.
Such borrowings bypass the net borrowing ceiling fixed for states in a fiscal year by routing loans outside state budget through government owned companies or statutory bodies. Since the responsibility for repayment lies with states, it adversely impacts their revenue and fiscal deficit.
As per norms, state governments are required to take the Centre’s approval for fresh borrowing over the limit set for a particular financial year.
But states don’t need prior central consent to guarantee the loans and advances, and bonds issued by its entities. Also, the ceiling on guarantees is self-determined and varies from state to state. All these have led to greater reliance on off-budget borrowings.
Over the last two years, many states have resorted to off-budget borrowing to fund their capital expenditures and minimise the impact of a economic downturn induced by COVID-19.
The Centre has fixed the net borrowing ceiling of states at Rs 8,57,849 crore or 3.5 per cent of GSDP. States are also eligible for additional borrowing of 0.50 per cent of GSDP linked to reforms in the power sector.
GEOGRAPHICAL INDICATION (GI) STATUS
News – Bihar’s Mithila Makhana has been awarded the Geographical Indication (GI) tag.
About Mithila Makhana
Cultivated in the Mithila region of Bihar and Nepal, Mithila Makhana is a unique variety of aquatic fox nuts.
Its botanical name is Euryale Ferox Salisb
It is grown in ponds on a leaf.
India’s 80 per cent Makhana or Fox Nut supply is fulfilled by Bihar. It is popular in a festival called Kojagara Puja.
Mithila Makhana is good for health and a rich source of protein, fibre, calcium, magnesium, iron, and phosphorus.
Other GI products from Bihar
Other products that received GI tag in Bihar include bhagalpuri jardalu mango, katarni rice, magahi betel (Paan), shahi litchi, silao khaja, madhubani painting and pipli work.
News – Five agricultural products of Kerala have been granted Geographical Indication (GI) status.
Attappady Attukombu Avara
Cultivated in the Attappady region of Palakkad
Curved like a goat’s horn as its name indicates
Its higher anthocyanin content, compared to other dolichos beans, imparts violet colour in the stem and fruits.
Attappady Thuvara
It has seeds with white coat.
These are bigger and have higher seed weight than the regular variety.
Kanthalloor-Vattavada Veluthulli (garlic)
It contains higher amount of sulphides, flavonoids, and proteins compared to the garlic produced in other areas.
Onattukara Ellu
Onattukara Ellu and its oil are famous for its unique health benefits.
Relatively higher antioxidant content in Onattukara Ellu helps in fighting the free radicals which destroy the body cells.
Kodungalloor Pottuvellari
Cultivated in Kodungalloor and parts of Ernakulam is consumed as juice and in other forms.
This snap melon, which is harvested in summer, is excellent for quenching thirst.
News – The famous Tandur red gram of Telangana has got geographical indication (GI) tag.
Tandur red gram
It is a local variety of pigeon pea which is mainly grown in the rainfed tract of the Tandur and nearby region of Telangana.
The specific quality traits of Tandur Red Gram has been attributed to the fertile deep black soil with huge deposits of Attapulgite clay mineral specifically in Tandur region along with huge limestone deposits.
It contains about 22-24% protein, which is almost three times that of the protein content in cereals.
It has good taste, better cooking quality as well as enhanced storage quality.
About GI tag
GI tag is a special tag given to a specific area of products, agricultural, natural and manufactured products (handicrafts and industrial goods).
It is given to a product of special quality and identity that originates in a specific geographical area.
The GI tagging helps products in building a brand, generating local employment and most significantly it helps in preserving the traditional knowledge, culture and expression of the particular region (and its people).
No individual or company can sell a product under the name, which has received a GI tag.
It provides legal protection and prevention against any illegitimate use of the product.
It gives an authenticity label and promotes exports of the item.
In India, the Geographical Indications of Goods (Registration and Protection) Act, 1999 provides protection to GI relating to goods and is governed and directed by the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).
Further, Articles 1(2) and 10 of the Paris Convention state that the protection of industrial Property and Geographical Indication are elements of Intellectual Property. The validity of the tag is 10 years which can be renewed further.
Source: Explained: What Is Mithila Makhana That’s Been Awarded The GI Tag (indiatimes.com)
Five agricultural products of Kerala get GI tag, taking the total count to 17 (thehindu.com)
Telangana’s Tandur red gram gets GI tag – The Hindu
NATIONAL LOGISTICS POLICY (NLP) 2022
News – The Prime Minister of India has launched the National Logistics Policy (NLP) 2022.
Targets of National Logistics Policy (NLP) 2022
Reduce cost of logistics in India to be comparable to global benchmarks by 2030
Improve the Logistics Performance Index ranking – endeavor is to be among top 25 countries by 2030
Create data driven decision support mechanism for an efficient logistics ecosystem.
Source: 239205.pdf (logistics.gov.in)
ECONOMIC TERMS
Cantillon Effect – It refers to the idea that changes in money supply in an economy causes redistribution of purchasing power among people, disturbs relative prices of goods and services, and leads to misallocation of scarce resources.
Moonlighting – taking up a second job or multiple jobs apart from one’s full-time job, without informing their current employer about it.
Shrinkflation – a product downsizes its quantity while keeping the price the same.
Impact investing – It is an investment strategy that aims to generate specific beneficial social or environmental effects in addition to financial gains. Investors who use impact investing as a strategy consider a company’s commitment to corporate social responsibility (CSR) or the sense of duty to positively serve society as a whole before they become involved with that company.
SUGAR
News – In Sugar Season (Oct-Sep) 2021-22, India emerges as the world’s largest producer and consumer of sugar and world’s 2nd largest exporter of sugar.
About sugarcane
India, Brazil, China, Thailand Pakistan, Mexico, Columbia, Australia, Guatemala, etc. are some of the leading sugarcane producing countries in the world.
Sugarcane is a crop of tropical areas.
Under rainfed conditions, it is cultivated in sub-humid and humid climates.
It is largely an irrigated crop in India.
In Indo-Gangetic plain, its cultivation is largely concentrated in Uttar Pradesh.
Sugarcane growing area in western India is spread over Maharashtra and Gujarat.
In southern India, it is cultivated in irrigated tracts of Karnataka, Tamil Nadu, Telangana and Andhra Pradesh.
Uttar Pradesh, Maharashtra, Karnataka, Tamil Nadu, and Andhra Pradesh are the leading producers of this crop.
Source: NCERT
Impossible trinity
News – The Federal Reserve raising interest rates to fight rising prices has brought Impossible Trinity or under focus.
About Impossible trinity
Impossible trinity is also known as the trilemma.
It means an economy cannot pursue independent monetary policy, maintain a fixed exchange rate, and allow the free flow of capital across its borders at the same time.
Any economy can choose to pursue only two out of the three policy options noted above simultaneously in the long-run.
The idea was proposed independently by Canadian economist Robert Mundell and British economist Marcus Fleming in the early 1960s.
Source: The impossible trinity: how the free movement of capital comes with a cost – The Hindu
DOOM LOOP
News – Chances of doom loop in Europe.
It is a situation in which one negative economic condition creates a second negative condition, which in turn creates a third negative condition or reinforces the first, resulting in a self-reinforcing downward spiral.
Excess government debt can trigger an economic doom loop, as happened in Greece in 2010.
A weak banking system (or one overexposed to risk) can also trigger a doom loop, as happened in the 2008 global financial crisis.
Intervention in the form of a bailout is usually needed to break a doom loop.
The loop increases borrowing pressure on the already-stressed government, which further reduces the value of the bonds it issues, and the loop continues.
Source: Doom Loop: Definition, Causes, and Examples (investopedia.com)
Carbon border tax
News – A group of countries including India has opposed the carbon border taxes policy at the COP27 saying it could “result in market distortion”.
Carbon Border Adjustment Mechanism is a plan from the European Union (EU) to tax carbon-intensive products, such as iron and steel, cement, fertiliser, aluminium and electricity generation, from 2026.
Carbon border tax involves imposing an import duty on a product manufactured in a country with more lax climate rules than the one buying it.
The EU came up with the Carbon Border Adjustment Mechanism in 2021.
EU importers will buy carbon certificates corresponding to the carbon price that would have been paid, had the goods been produced under the EU’s carbon pricing rules.
Conversely, once a non-EU producer can show that they have already paid a price for the carbon used in the production of the imported goods in a third country, the corresponding cost can be fully deducted for the EU importer.
Source: What is carbon border tax, which India opposed at COP27 | Explained News,The Indian Express
Surety Bond Insurance
News – Union Minister for Road Transport and Highways launched one of India’s first-ever Surety Bond Insurance product from Bajaj Allianz.
Its simplest form as a written agreement to guarantee compliance, payment, or performance of an act.
Surety is a unique type of insurance because it involves a three-party agreement.
Principal – the party that purchases the bond and undertakes an obligation to perform an act as promised.
Surety – the insurance company or surety company that guarantees the obligation will be performed. If the principal fails to perform the act as promised, the surety is contractually liable for losses sustained.
Obligee – the party who requires, and often receives the benefit of— the surety bond. For most surety bonds, the obligee is a local, state or federal government organization.
Surety Bond Insurance will act as a security arrangement for infrastructure projects and will insulate the contractor as well as the principal.
The Surety Bond Insurance is a risk transfer tool for the Principal and shields the Principal from the losses that may arise in case the contractor fails to perform their contractual obligation.
The product gives the principal a contract of guarantee that contractual terms and other business deals will be concluded in accordance with the mutually agreed terms.
In case the contractor doesn’t fulfil the contractual terms, the Principal can raise a claim on the surety bond and recover the losses they have incurred.
Unlike a bank guarantee, the Surety Bond Insurance does not require large collateral from the contractor thus freeing up significant funds for the contractor, which they can utilize for the growth of the business.
The product will also help in reducing the contractors’ debts to a large extent thus addressing their financial worries.
Source: https://www.pib.gov.in/PressReleaseIframePage.aspx?PRID=1884946
What is a Surety Bond? Surety Bonds Explained. (suretybondsdirect.com)
