UDAAN 500

PLUS
FOR PRELIMS 2022
CURRENT AFFAIRS
January 2021 to January 2022

covering
+
500
INDIAN ECONOMY days
ONE
STOP
SOLUTION

 

 

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Prelims Mains

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Jagarati Awasthi Satyam Gandhi Gaurav Budania

UPSC CSE 2020 UPSC CSE 2020 UPSC CSE 2020
AIR-02 AIR-10 AIR-13

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OnlyIAS UDAAN PLUS: ECONOMY

PREFACE

Dear aspirants, OnlyIAS team is ecstatic to present this book to you, which is certainly
going to be your best companion in your preparation.

This book has been designed by considering the issues and challenges students face
during Prelims preparation. While preparing this book, our team was aiming to solve as
much problems as possible. For example, students are many a times so confused about
what to study and what not in current affairs section, which news is relevant and which
news is to be ignored, how much in depth we should go for any topic, what kind of
questions UPSC asks from particular topic, how to link static with current etc.

This book is an honest attempt to solve these problems and to help students perform
better in exam, save time in preparation and get rid of various confusions which they
basically come across.

Right from the number of pages, to what topic to be covered, our team has done research
on every aspect to make it the finest version of itself. Covering everything comes with a
limitation of retention power, relevancy, possibility of revision, too many pages which
makes it beyond bulky and ultimately lot of time consumption of students for not so
important things adding to that a kind of distracted paths.

This book is an attempt to make your preparation to the point, relevant, based on UPSC
ongoing trend and pattern, revision friendly, and most updated.

OnlyIAS team wish you all the best for your preparation with all humility and
humbleness and we are hopeful that this book will do wonders for you. Keep reading.

Sumit Rewri and team

Note: We are also publishing UDAAN 2.0 series, which will cover your static along with
contemporary developments. You can expect best of the results if you cover that quick and
comprehensive revision series named UDAAN 2.0

Note: Although our team has tried best, yet if any important issue we found which needs updating we
will do the same and current issues of last few months will be updated and a supplementary of few
issues will be compiled and will be released soon.

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OnlyIAS UDAAN PLUS: ECONOMY

LITHIUM REFINERY .................................................................. 23

1. AGRICULTURE ..................................................................... 4
GLOBAL HOUSING TECHNOLOGY CHALLENGE ........... 23
SEAWEED FARMING ....................................................................4 SAGARMALA SEAPLANE SERVICES (SSPS) .................... 24
SEAWEED MISSION ......................................................................4 GOLDEN QUADRILATERAL & GOLDEN DIAGONAL
NATIONAL AGRICULTURE MARKET (E-NAM).................4 SECTIONS....................................................................................... 24
SOIL HEALTH CARD SCHEME ..................................................4 FREIGHT BUSINESS DEVELOPMENT PORTAL .............. 24
TRIFOOD PARKS ............................................................................5 PRARAMBH – STARTUP INDIA INTERNATIONAL
SAGUNA RICE TECHNIQUE .......................................................5 SUMMIT .......................................................................................... 25
UNIFIED PORTAL OF GOBARDHAN ......................................5 STARTUP INDIA SEED FUND SCHEME (SISFS) ............. 25
SUB-MISSION ON AGROFORESTRY SCHEME ....................5 NATIONAL STARTUP ADVISORY COUNCIL .................... 26
AGRICULTURE VOLTAGE TECHNOLOGY ...........................6 IRON ORE POLICY 2021........................................................... 26
MIYAWAKI TECHNIQUE ............................................................6 SECTION 32A OF IBC ................................................................. 27
PLI SCHEME FOR FOOD PROCESSING INDUSTRY ..........6 INSOLVENCY AND BANKRUPTCY CODE
OPIUM PRODUCTION IN INDIA ...............................................7 (AMENDMENT) BILL 2021 .................................................... 27
SHAPHARI SCHEME .....................................................................7 MEGA INVESTMENT TEXTILES PARKS (PM MITRA)
E-SANTA WEB PORTAL ..............................................................7 SCHEME .......................................................................................... 28
CODEX COMMITTEE ON SPICES AND CULINARY ONE DISTRICT-ONE PRODUCT SCHEME ......................... 28
HERBS (CCSCH) ..............................................................................8 PRADHAN MANTRI URJA GANGA PROJECT ................... 29
LARGE AREA CERTIFICATION.................................................8 OCCUPATIONAL SAFETY, HEALTH AND WORKING
AGRICULTURE INFRASTRUCTURE FUND (AIF)..............9 CONDITIONS CODE.................................................................... 30
MACS 1407 .......................................................................................9 SAKSHAM (SHRAMIK SHAKTI MANCH) ........................... 30
INDIA BEGINS EXPORTS OF ORGANIC MILLETS .......... 10 MAJOR PORT AUTHORITIES BILL, 2020 .......................... 30
MISSION FOR INTEGRATED DEVELOPMENT OF SAMARTH SCHEME ................................................................... 31
HORTICULTURE ......................................................................... 10 PUBLIC SECTOR ENTERPRISE POLICY ............................. 31
PRADHAN MANTRI KISAN SAMMAN NIDHI (PM- GO ELECTRIC CAMPAIGN ....................................................... 32
KISAN) ............................................................................................. 10 HYDROGEN FUEL ....................................................................... 32
NANO UREA LIQUID .................................................................. 11 NATIONAL URBAN DIGITAL MISSION (NUDM) ............ 33
HORTICULTURE CLUSTER DEVELOPMENT FIXED TERM EMPLOYMENT ................................................. 33
PROGRAMME ............................................................................... 11 INDIA TELECOM 2021 ............................................................. 34
SEED MINIKIT PROGRAMME ................................................ 11 RATING MECHANISM FOR NATIONAL HIGHWAYS .... 34
SUB-MISSION ON AGRICULTURAL MECHANIZATION LAND PORTS AUTHORITY OF INDIA ................................. 35
............................................................................................................ 12 STAND UP INDIA SCHEME ..................................................... 35
PMFME SCHEME SEED CAPITAL MODULE ..................... 12 GRAM UJALA................................................................................. 36
HARIT DHARA ............................................................................. 12 UNIQUE LAND PARCEL IDENTIFICATION NUMBER
DAIRY INVESTMENT ACCELERATOR ............................... 13 (ULPIN) SCHEME........................................................................ 36
BHARTIYA PRAKRITIK KRISHI PADHATI ....................... 13 MARITIME INDIA SUMMIT 2021......................................... 36
NATIONAL INNOVATIONS IN CLIMATE RESILIENT AIM-PRIME ................................................................................... 37
AGRICULTURE ............................................................................. 14 INDIA ENERGY DASHBOARDS.............................................. 37
NATIONAL MISSION ON EDIBLE OIL-OIL PALM TRADE FACILITATION MOBILE APPLICATION ............ 38
(NMEO-OP) ................................................................................... 14 EATSMART CITIES CHALLENGE AND TRANSPORT 4
E-GOPALA APP ............................................................................ 14 ALL CHALLENGE ........................................................................ 38
LINAC-NCDC FISHERIES BUSINESS INCUBATION POWER GRID INFRASTRUCTURE INVESTMENT TRUST
CENTRE .......................................................................................... 15 ............................................................................................................ 39
RIVER RANCHING PROGRAMME ........................................ 15 PLI SCHEME FOR ADVANCED CHEMISTRY CELL
MINIMUM SUPPORT PRICE ................................................... 16 BATTERY STORAGE .................................................................. 39
PUSA BASMATI 1979 AND PUSA BASMATI 1985 ........ 16 PRODUCTION-LINKED INCENTIVE (PLI) SCHEME FOR
NATIONAL DIGITAL LIVESTOCK MISSION ..................... 17 SPECIALTY STEEL ...................................................................... 40
TRANSPORT AND MARKETING ASSISTANCE (TMA) PLI SCHEME FOR TEXTILES .................................................. 40
SCHEME .......................................................................................... 17 PLI SCHEME FOR PROMOTING TELECOM AND
KRISHI UDAN 2.0 SCHEME ..................................................... 17 NETWORKING PRODUCTS MANUFACTURING IN
PRADHAN MANTRI KRISHI SINCHAYEE YOJANA ........ 18 INDIA ............................................................................................... 41
SEED VILLAGE PROGRAMME ............................................... 18 SWAMIH INVESTMENT FUND .............................................. 41
PM-KISAN ...................................................................................... 19 E-WAY BILL INTEGRATION WITH FASTAG, RFID ....... 41
DRAFT RULES FOR GM FOODS ............................................. 19 MCA21 V3.0................................................................................... 42
BIOENERGY CROPS ................................................................... 20 ONE NATION-ONE STANDARD MISSION ......................... 42
MOBILE HONEY PROCESSING VAN .................................... 20 INLAND VESSELS BILL ............................................................. 43
PROMOTION OF DRONE USE IN AGRICULTURE .......... 21 INTEGRATED POWER DEVELOPMENT SCHEME ......... 44
PURPLE REVOLUTION ............................................................. 21 LAND BANKS/INDIA INDUSTRIAL LAND BANK .......... 44
NATRAX .......................................................................................... 44
2. INDUSTRY AND INFRASTRUCTURE ........................... 22
BHARATNET................................................................................. 45
NEW INDUSTRIAL DEVELOPMENT SCHEME FOR REVAMPED DISTRIBUTION SECTOR SCHEME ............. 45
JAMMU & KASHMIR ................................................................... 22 FREIGHT SMART CITIES INITIATIVE ................................ 46
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OPEN NETWORK FOR DIGITAL COMMERCE ................. 46 ACCREDITED INVESTORS ...................................................... 67

EXPERT COMMITTEE ON LONGEVITY FINANCE ......... 46 INDIAN FOREIGN EXCHANGE RESERVES ....................... 67
POLICY ON VINTAGE VEHICLES .......................................... 47 INFLATION TARGETING ......................................................... 68
PRADHAN MANTRI GRAM SADAK YOJANA .................... 47 CHINA’S DIGITAL CURRENCY ............................................... 68
GATI SHAKTI ................................................................................ 48 DOGECOIN ..................................................................................... 69
INDIA’S LARGEST FLOATING SOLAR PROJECT............. 48 STABLECOINS .............................................................................. 69
UBHARTE SITAARE FUND...................................................... 49 CURRENCY WATCH LIST ........................................................ 69
NATIONAL MONETISATION PIPELINE ............................ 49 SOVEREIGN GOLD BOND SCHEME ..................................... 70
SAMRIDH SCHEME .................................................................... 50 IPO GREY MARKET .................................................................... 70
BHARAT SERIES (BH-SERIES) .............................................. 50 BHIM-UPI LAUNCHED IN BHUTAN .................................... 70
UDAN SCHEME ............................................................................ 51 E-RUPI ............................................................................................. 71
KHAVDA RENEWABLE ENERGY PARK ............................. 51 INTERNATIONAL BULLION EXCHANGE .......................... 71
NATIONAL SINGLE WINDOW SYSTEM ............................. 52 MARQUEE INSTITUTIONAL INVESTORS ......................... 72
NATIONAL EXPORT INSURANCE ACCOUNT SCHEME SEBI MOOTS ENTRY NORMS TO SET UP STOCK
............................................................................................................ 52 EXCHANGES.................................................................................. 72
NATIONAL ROAD SAFETY BOARD...................................... 52 SECURITIES APPELLATE TRIBUNAL................................. 72
THE DRAFT ELECTRICITY (RIGHTS OF CONSUMERS) DIGITAL INTELLIGENCE UNIT ............................................. 73
AMENDMENT RULES, 2021 ................................................... 53 CENTRAL SCRUTINY CENTRE AND IEPFA MOBILE APP
'MAHARATNA' STATUS TO POWER FINANCE ............................................................................................................ 73
CORPORATION ............................................................................ 53 BLOCKCHAIN-BASED TRACEABILITY INTERFACE .... 73
SAMBHAV AWARENESS PROGRAMME ............................ 54 REGULATIONS REVIEW AUTHORITY 2.0 ........................ 74
COMMUNITY RESOURCE PERSONS-ENTERPRISE NATIONAL FINANCIAL REPORTING AUTHORITY....... 75
PROMOTION (CRP-EP) ............................................................ 54 MR. NILESH SHAH COMMITTEE .......................................... 75
MINERALS CONCESSION (FOURTH AMENDMENT) ENFORCEMENT DIRECTORATE .......................................... 76
RULES, 2021 ................................................................................. 55 INSTITUTE OF COST ACCOUNTANTS OF INDIA ........... 76
USOF SCHEME.............................................................................. 55 T+1 SETTLEMENT SYSTEM ................................................... 76
TIGHT OIL ...................................................................................... 56 NATIONAL COMPANY LAW TRIBUNAL ........................... 77
O-SMART SCHEME ..................................................................... 56 OPERATION MOLTEN METAL .............................................. 77
PROGRAMME TO UPSKILL STREET VENDORS ............. 57 SOCIAL STOCK EXCHANGES .................................................. 78
SMART CITIES MISSION .......................................................... 57 NSE-SHINE BULLION BLOCKCHAIN PLATFORM ......... 78
ALL INDIA EDTECH CHALLENGE AND MASTER CLASS SAARTHI MOBILE APP ............................................................. 78
SERIES INITIATIVE .................................................................... 58 IC15 CRYPTOCURRENCY INDEX ......................................... 79
NEAT INITIATIVE ....................................................................... 58 FOREIGN CONTRIBUTION REGULATION ACT .............. 79
CERTIFICATION COURSE ON HOME ENERGY AUDIT 59
6. BANKING SECTOR OF INDIA ........................................ 80
GRAM UJALA PROGRAMME ................................................... 59
ULIP HACKATHON – LOGIXTICS .......................................... 60 CURRENT ACCOUNT ................................................................. 80
ATMANIRBHAR HASTSHILPKAR SCHEME ..................... 60 REGULATION OF NBFCS.......................................................... 80
PERFORM, ACHIEVE AND TRADE (PAT) SCHEME ...... 60 LEGAL ENTITY IDENTIFIER (LEI) SYSTEM .................... 81
OPEN ACREAGE LICENSING POLICY ................................. 61 JAYANT KUMAR DASH COMMITTEE ................................. 81
NATIONAL TECHNICAL TEXTILES MISSION .................. 61 OPEN MARKET OPERATIONS (OMO) ................................ 81
DESIGN LINKED INCENTIVE FOR SEMICONDUCTORS BANKS BOARD BUREAU.......................................................... 82
............................................................................................................ 61 NATIONAL BANK FOR FINANCING INFRASTRUCTURE
CHIPS TO STARTUP (C2S) PROGRAMME......................... 62 AND DEVELOPMENT ................................................................ 82
INDIAN RENEWABLE ENERGY DEVELOPMENT AT-1 BONDS.................................................................................. 83
AGENCY LIMITED....................................................................... 62 SHYAMALA GOPINATH COMMITTEE ................................ 83
ONE NATION ONE OMBUDSMAN ........................................ 84
3. SERVICE SECTOR IN INDIA ............................................ 63
EMERGENCY CREDIT LINE GUARANTEE SCHEME ..... 84
BUREAU OF INDIAN STANDARDS (BIS) ........................... 63 NATIONAL BANK FOR AGRICULTURE AND RURAL
STATE REFORM ACTION PLAN ............................................ 64 DEVELOPMENT (NABARD) ................................................... 85
SUNIL SETHI COMMITTEE ..................................................... 64 CURRENCY CHEST ..................................................................... 85
SUDARSHAN SEN COMMITTEE............................................ 85
4. INDIAN INSURANCE MARKET ...................................... 65
WAYS AND MEANS ADVANCES ............................................ 86
G.N. BAJPAI COMMITTEE ........................................................ 65 CREDIT RATING .......................................................................... 86
NATIONAL EXPORT INSURANCE ACCOUNT SCHEME NATIONAL COMPANY LAW APPELLATE TRIBUNAL . 87
............................................................................................................ 65 FINANCIAL STABILITY REPORT.......................................... 87
DIRECT MONETISATION OF DEFICIT ............................... 88
5. FINANCIAL AND SECURITY MARKET ........................ 66
NEW REGULATORY REGIME FOR MICROFINANCE .... 88
PAYMENTS INFRASTRUCTURE DEVELOPMENT FUND G-SEC ACQUISITION PROGRAMME 2.0............................. 89
(PIDF) .............................................................................................. 66 ACCOUNT AGGREGATOR ........................................................ 89
WASHINGTON CONSENSUS .................................................. 66 SECURED OVERNIGHT FINANCING RATE ...................... 89
LINE OF CREDIT (LOC)............................................................. 66 NEO-BANKS .................................................................................. 90
BLANK-CHEQUE COMPANY .................................................. 66
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OnlyIAS UDAAN PLUS: ECONOMY

REVISED PROMPT CORRECTIVE ACTION (PCA) GREEN HYDROGEN MICROGRID PROJECT .................. 111
FRAMEWORK............................................................................... 90 ETHANOL BLENDED PETROL PROGRAMME .............. 111
DEPRECIATION OF INDIAN RUPEE .................................... 91 INTRA-STATE TRANSMISSION SYSTEM - GREEN
SCHEDULE BANK ....................................................................... 91 ENERGY CORRIDOR ............................................................... 112
ASSETS UNDER MANAGEMENT (AUM) ........................... 92
11. IMPORTANT INDEX AND REPORTS ...................... 113
TOKENIZATION .......................................................................... 92
ESG FUNDS .................................................................................... 93 DIGITAL PAYMENTS INDEX ............................................... 113
OFFLINE SMALL-VALUE E-PAYMENTS ............................ 93 WORLD FOOD PRICE INDEX: FAO.................................... 113
FAIR VALUE THROUGH PROFIT AND LOSS (FVTPL) INDIA INNOVATION INDEX ................................................ 113
ACCOUNT ....................................................................................... 93 INDIA ENERGY OUTLOOK 2021 REPORT ..................... 113
BARE NECESSITIES INDEX.................................................. 114
7. TAXATION........................................................................... 94
INDEX OF ECONOMIC FREEDOM 2021 .......................... 114
RODTEP SCHEME ....................................................................... 94 WORLD HAPPINESS REPORT 2021 ................................ 115
GREEN TAX ................................................................................... 94 OXFAM INEQUALITY INDEX ............................................... 115
CESS AND SURCHARGE............................................................ 95 OXFAM REPORT: INEQUALITY KILLS ............................ 116
GLOBAL MINIMUM CORPORATE INCOME TAX ............ 95 INTERNATIONAL INTELLECTUAL PROPERTY INDEX
TAX INSPECTORS WITHOUT BORDERS ........................... 96 ......................................................................................................... 116
REBATE OF STATE AND CENTRAL TAXES AND LEVIES WORLD ECONOMIC OUTLOOK.......................................... 117
(ROSCTL) SCHEME .................................................................... 97 ENERGY TRANSITION INDEX 2021................................. 117
THE TAXATION LAWS (AMENDMENT) BILL, 2021 .... 97 GLOBAL ELECTRIC VEHICLES OUTLOOK 2021 ......... 118
PURCHASING MANAGERS’ INDEX ................................... 118
8. PUBLIC FINANCE .............................................................. 98
WORLD EMPLOYMENT AND SOCIAL OUTLOOK:
INTERNATIONAL FINANCIAL SERVICES CENTRES TRENDS 2021 ........................................................................... 118
AUTHORITY (IFSCA) ................................................................. 98 WORLD ENERGY INVESTMENT REPORT 2021 ......... 119
OFF BUDGET BORROWINGS ................................................. 98 GLOBAL LIVEABILITY INDEX ............................................ 120
PRADHAN MANTRI MUDRA YOJANA ................................ 99 WORLD COMPETITIVENESS INDEX 2021 .................... 120
WORLD INVESTMENT REPORT 2021 ............................ 120
9. EXTERNAL SECTOR OF INDIA ...................................... 99
FINANCIAL INCLUSION INDEX ......................................... 121
TRADE POLICY REVIEW MECHANISM ............................. 99 PERIODIC LABOUR FORCE SURVEY................................ 121
ANTI-DUMPING DUTY ............................................................. 99 QUARTERLY BULLETIN OF PERIODIC LABOUR FORCE
VEHICLE SCRAPPING POLICY ............................................ 100 SURVEY (OCTOBER-DECEMBER 2020) ........................ 122
PRORIISE SOFTWARE ........................................................... 100 INDEX OF INDUSTRIAL PRODUCTION........................... 122
GOLD HALLMARKING ........................................................... 101 GLOBAL INNOVATION INDEX 2021 ................................ 123
PATENTS (AMENDMENT) RULES, 2021 ....................... 101 CIPS EXCELLENCE IN PROCUREMENT AWARDS 2021
ESSENTIAL COMMODITIES ACT 1955 ........................... 102 ......................................................................................................... 123
CONSUMER PROTECTION (DIRECT SELLING) INDUSTRIAL PARK RATINGS SYSTEM REPORT ........ 124
RULES,2021 ............................................................................... 102 NOBEL PRIZE IN ECONOMICS 2021................................ 124
ELECTRONIC GOLD RECEIPTS .......................................... 102 GLOBAL FOOD SECURITY INDEX 2021.......................... 125
LEADS REPORT 2021 ............................................................ 125
10. HUMAN DEVELOPMENT AND SUSTAINABLE
WAGE RATE INDEX ................................................................ 125
DEVELOPMENT ................................................................... 103
STATE OF INDIA’S LIVELIHOOD REPORT 2021......... 126
EMPLOYEE PROVIDENT FUND (EPF) SCHEME ......... 103 GLOBAL UNICORN INDEX 2021 ........................................ 126
CONSUMER WELFARE FUND............................................. 103
ATAL BHUJAL YOJANA .......................................................... 104
SANKALP..................................................................................... 104
CENTRAL EMPLOYMENT GUARANTEE COUNCIL .... 104
DRAFT BLUE ECONOMY POLICY ...................................... 104
THE HYDROGEN ECONOMY – NEW DELHI DIALOGUE
2021 .............................................................................................. 105
NATIONAL MISSION ON USE OF BIOMASS IN
THERMAL POWER PLANTS ................................................ 106
GREEN HYDROGEN MOBILITY PROJECT ...................... 107
HYDROGEN FUEL .................................................................... 107
PM-DAKSH ................................................................................. 108
SEEKHO AUR KAMAO SCHEME ......................................... 108
UJJWALA 2.0 SCHEME ........................................................... 108
SAUBHAGYA SCHEME ........................................................... 109
RENEWABLE ENERGY CERTIFICATE............................. 109
BIO-ECONOMY ......................................................................... 110
MGNREGA ................................................................................... 110
SUSTAINABLE DEVELOPMENT CELL ............................ 110
SAMPANN PROJECT ............................................................... 111
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OnlyIAS UDAAN PLUS: ECONOMY

o Abate algal blooms, sequester millions of tons

1. AGRICULTURE CO2
o Produce bioethanol approx. 6.6 billion litres
SEAWEED FARMING
• In News: In Budget 2021, the Finance Minister has NATIONAL AGRICULTURE MARKET (E -NAM)
proposed to set up a multi-purpose seaweed park in • In News: Recently, it has been reported that more
Tamil Nadu. It will be a part of the Seaweed Farming than 1.69 crore Farmers & 1.55 Lakh traders are
promotion in India. registered on e-NAM platform.

Seaweed: e-NAM:
• Seaweed, or macroalgae → thousands of species of • An online trading platform for agriculture produce to
macroscopic, multicellular, marine algae, play a key help farmers, traders, and buyers. It networks the
ecological role in coastal ecosystems (ocean as well as existing APMC mandis to create a unified national
in rivers, lakes, & other water bodies). market.
• May belong to several groups of multicellular • Objective:
algae → red algae, green algae, and brown algae. o To promote uniformity in agriculture marketing
• Use light to fix atmospheric carbon dissolved in by streamlining procedures across the integrated
water. Macroalgae are amongst the most powerful markets.
carbon-fixing organisms on earth. o Removing information asymmetry between
• Seaweed Species in India: Kappaphycus alvarezii, buyers and sellers and promoting real time price
Gracilaria edulis, Gelidiella acerosa, Sargassum spp. discovery based on actual demand and supply.
and Turbinaria spp. • Implementing Agency: Small Farmers Agribusiness
• Importance of Seaweed Farming: Provide Consortium (SFAC) under the aegis of Ministry of
occupation for the coastal people; Continuous supply Agriculture and Farmers’ Welfare, Government of
of raw material for seaweed-based industry; Eco- India.
friendly; treat coastal pollution; reduce CO2.
SOIL HEALTH CARD SCHEME
Seaweed Farming:
• In News: Recently, it has been reported that the
• Seaweed farming or Kelp farming is the practice of
scheme is being implemented in 32 States and UTs.
cultivating and harvesting seaweed.
• Introduced: Ministry of Agriculture, 5th December
• Simplest form: it consists of the management of
2015.
naturally found batches.
• Features: Village level Soil Testing Labs will be set up
• Most advanced form: it consists of fully controlling
by youth having education in agriculture, Women Self
the life cycle of the algae.
Help Groups, FPOs etc.
• Aim: enabling employment generation after
Commercial Significance of Seaweeds:
appropriate skill development.
• Rich in vitamins, minerals, & fibre
• Contain anti-inflammatory & anti-microbial agents
Soil Health Card:
• Possess powerful cancer-fighting agents
• Printed report that a farmer will be handed over for
• Effective binding agents (emulsifiers) & popular each of his holdings.
softeners (emollients) used in toothpaste, fruit jelly,
• Two sets of fertilizer recommendations for six
cosmetic products, etc.
crops including recommendations of organic
manures.
SEAWEED MISSION • Parameters: pH, Electrical Conductivity (EC),
• In News: Recently, the Technology Information, Organic Carbon (OC), Nitrogen (N), Phosphorus (P),
Forecasting and Assessment Council (TIFAC) has Potassium (K), Sulphur (S), Zinc (Zn), Boron (B), Iron
launched an initiative called ‘Seaweed Mission’. (Fe), Manganese (Mn), Copper (Cu).
• Launched by: Technology Information, Forecasting • Objectives:
and Assessment Council (TIFAC) o To improve soil quality and profitability of
• Objective: Commercial farming of seaweeds and its farmers.
processing for value addition towards boosting the o Employment generation for rural youth.
national economy. o To update information on soil analysis.
• Benefits: If cultivation is done in 5% of the EEZ area o To provide soil testing facilities to farmers at
of India, it can: their doorstep.
o Set up new seaweed industry • Benefits:
o Provide employment to people and Contribute to o Help farmers to increase crop production
national GDP o Ensure the quality of land fertility
o Improve ocean productivity and create a o Farmers can choose crops based on the reports.
healthier ocean • Soil Health Management Scheme:
o Promoting organic farming practices

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o Judicious use of chemical fertilizers + organic • Zerotill technique: Unique Conservation

manures and biofertilizers Agriculture → type of cultivation method.
o Strengthening of soil and fertilizer testing • Uses: to cultivate rice and related rotation crops
facilities without ploughing, puddling and transplanting rice
o Ensuring quality control requirements of on permanent raised beds.
fertilizers, biofertilizers and organic fertilizers • SRT iron forma tool: facilitates planting of crops in
under Fertiliser Control Order, 1985 predetermined distances enabling precise plant
o Upgradation of skill and knowledge of soil testing population per unit area.
laboratory staff. • Important principles:
o All roots and small portions of stem should be left
TRIFOOD PARKS in the beds for slow rotting.
• In News: Recently, TRIFED Signs MoU with Akhil o No ploughing, puddling and hoeing to be done to
Bhartiya Vanvasi Kalyan Ashram for setting up of control weeds.
TRIFOOD Parks in Madhya Pradesh o SRT will get the crop ready for harvesting 8 to 10
days earlier.
About: o SRT can be opted while choosing a variety to
avoid getting harvested caught in receding rain.
• Agency Involved: TRIFED (under the Ministry of
Tribal Affairs) and the Ministry of Food Processing. • Advantages of SRT:
o Saves 30% to 40% cost of production & 50%
• Launched under the Van Dhan Yojana in 2020.
treacherous labor.
• Aim: Food processing centers, promoting value
o Loss of valuable silt (about 20%) during puddling
addition to minor forest produce.
can be prevented.
• Procure raw materials from the Van Dhan Kendras
and process them to be sold across the country
through Tribes India outlets. UNIFIED PORTAL OF GOBARDHAN
• MSP for minor forest produce is fixed by the Tribal • In News: Recently, a Unified Portal of Gobardhan has
Affairs Ministry and it is revised every three years by been launched to ensure smooth implementation of
a pricing cell constituted under the Ministry. Biogas schemes/initiatives and their real time
tracking.
Tribal Cooperative Marketing Development
Federation of India (TRIFED): Galvanizing Organic Bio-Agro Resources Dhan
• Formation: Statutory body, established in August (GOBAR-DHAN) Scheme:
1987 • Implemented: under the Swachh Bharat Mission
• Registered as: National level Cooperative body by Gramin-Phase 2, by the Department of Drinking
the Government of the country Water and Sanitation under the Jal Shakti ministry.
• Focus: • Launched in 2018.
o Institutionalizing the trade of Minor Forest • Aims: To augment income of farmers by converting
Produce (MFP) & Surplus Agricultural Produce biodegradable waste into compressed biogas (CBG).
(SAP) Also attracting entrepreneurs for establishing
o Manufactured products for national and community-based CBG plants in rural areas.
international markets on a sustainable basis • India is home to the highest cattle population (300
o Supporting the formation of Self Help Groups and million approx) in the world, with a daily output of
imparting training to them 3 million tonnes of dung.

Recent initiatives by TRIFED: SUB-MISSION ON AGROFORESTRY SCHEME

• Tech for Tribals: Initiative of TRIFED supported by
• In News: Recently, the Ministry of Agriculture and
Ministry of MSME, for capacity building and
Farmers Welfare has signed a MoU with the Central
imparting entrepreneurship skills to tribals under
Silk Board on a convergence model for the
the Pradhan Mantri Van Dhan Yojana (PMVDY).
implementation of Agroforestry in the silk sector
• Van Dhan Samajik Doori Jagrookta Abhiyaan:
under the Sub-Mission on Agroforestry (SMAF)
Aimed at educating Tribals on covid-19 response like
Scheme
social distancing, home quarantine, hygiene tips.
• Aim: To incentivize the farmers to take up
• Providing protective masks and hygiene products
sericulture-based Agroforestry models thereby
to the Van Dhan Self Help Groups (SHGs).
contributing to the Make in India and Make for the
World vision of the Prime Minister.
SAGUNA RICE TECHNIQUE
• In News: Recently, the Saguna Rice Technique (SRT) Sub-Mission on Agroforestry (SMAF):
technique will help stop the stubble burning in • Recommended By: National Agroforestry Policy
Punjab and Haryana. 2014

About:

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OnlyIAS UDAAN PLUS: ECONOMY

• Implementing By: The Department of Agriculture, • Component I: 10,000 MW of Decentralized Ground

Cooperation and Farmers Welfare (DAC & FW) since Mounted Grid Connected Renewable Power Plants of
2016-17. individual plant size up to 2 MW.
• Comes under: National Mission for Sustainable • Component II: Installation of 17.50 lakh standalone
Agriculture (NMSA). Solar Powered Agriculture Pumps of individual pump
• India: The first country to launch at the World capacity up to 7.5 HP.
Agroforestry Congress (Delhi, February 2014) • Component III: Solarisation of 10 Lakh Grid-
Currently, the scheme is being implemented in 20 connected Agriculture Pumps of individual pump
States and 2 UTs. capacity up to 7.5 HP
• Aim: To encourage farmers for multi-purpose and
climate resilient agriculture; additional source of MIYAWAKI TECHNIQUE
income to the farmers; enhanced feedstock to inter
• In News: Recently, a patch of land in Mumbai’s
alia wood-based and herbal industry.
eastern suburbs has become a testament to create the
• Significance:
“urban forests” through the Miyawaki technique.
o Improvement of the soil profile,
o Moisture conservation,
About
o Conservation of natural resources,
• Pioneered by Japanese botanist Akira Miyawaki in
o Creation of an additional source of livelihood,
1980s.
o Income opportunities.
• An afforestation technique to create urban forests
in a short span of time. Tiny forests grown on small
Central Silk Board
plots of land in 2 to 3 years and are self-sustaining
• Established during 1948.
(maintenance-free)
• Functions: under the administrative control of the
• Four layers: shrub, sub-tree, tree, and canopy.
Ministry of Textiles, having head quarter at
• Methods: local agro-climatic conditions are studied;
Bengaluru.
the seeds are planted at a very high density; ground
is covered with a thick layer of mulch.
Agroforestry:
• Benefits: Faster Process and Dense Forest; Faster
• Type of social forestry in which tree farming and
Regeneration of Land; Self Sustainable; Eco-friendly.
fodder plants, grasses and legumes are grown on the
farmers' land.
• Involves: raising of trees and agricultural crops PLI SCHEME FOR FOOD PROCESSING INDUSTRY
either on the same land or in close association in such • In News: Recently the Ministry of Food Processing
a way that all land including the waste patches is put Industries (MoFPI) has launched an online portal for
to good use. ‘Production Linked Incentive Scheme for Food
Processing Industry’ (PLISFPI).
AGRICULTURE VOLTAGE TECHNOLOGY
PLI scheme:
• In News: Recently, an Agri-voltaic system of 105 KW
• Introduced By: GoI in March 2020 to boost domestic
capacity has been developed by ICAR-Central Arid
manufacturing and cut down on import bills,
Zone Research Institute, Jodhpur.
• Objective:
Agriculture Voltage Technology: o To support creation of global food manufacturing
champions.
• This technology can increase the income of farmers
o To strengthen select Indian brands of food
by the generation of electricity and growing cash
products for global visibility and wider
crops simultaneously on the same piece of land.
acceptance in the international markets.
• Component-I of the KUSUM scheme: provision for
o To increase employment opportunities of off-
installation of the agri-voltaic system in farmers’
farm jobs.
fields with a capacity ranging from 500 KW to 2 MW.
o To ensure remunerative prices of farm produce
• National Solar Energy Federation of India (NSEFI)
and higher income to farmers.
also documented 13 operational agri-voltaic systems
• Other PLI Scheme approved sectors: automobiles,
in the country managed by different solar PV
pharmaceuticals, IT hardware including laptops,
functionaries and public Institutes.
mobile phones & telecom equipment, white goods,
chemical cells and textiles, etc.
KUSUM (Kisan Urja Suraksha Utthan Mahabhiyan)
• Categories:
Scheme:
o Category-I: Applicant under this category could
• Announced in the Union Budget 2018-19.
undertake Branding & Marketing activities
• Aims: to provide extra income to farmers, by giving
abroad also and apply for grant under the
them an option to sell additional power to the grid
scheme with a common application.
through solar power projects set up on their barren
o Category-II: SMEs Applicants manufacturing
lands.
innovative/ organic products who apply for PLI
Incentive based on Sales.
Components of KUSUM Scheme:
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OnlyIAS UDAAN PLUS: ECONOMY

o Category-III: Applicants applying solely for • Purpose: It certifies hatcheries and farms for the
grant for undertaking Branding & Marketing production of antibiotic-free shrimp products (It is an
activities abroad. Antibiotics free Certification Scheme).
• Based on: the United Nations’ Food and Agriculture
OPIUM PRODUCTION IN INDIA Organization’s technical guidelines on aquaculture
certification.
• In News: Recently, the Union government has
decided to rope in the private sector to commence • Aims to: enhance the consumer confidence, meet
production of concentrated poppy straw from India’s international standards and promote hassle-free
opium crop to boost the yield of alkaloids. export
• Certification Process: The entire certification
Poppy Straw: process will be online to minimize human errors and
• Poppy straw is the husk left after the opium is ensure higher credibility and transparency.
extracted from pods. • Components:
• This poppy straw also contains a very small o Certifying hatcheries for the quality of their seeds
morphine content and if used in sufficient quantities, and
poppy straw can give a high. o Separately approving shrimp farms that adopt
the requisite good practices.
• One of the narcotic drugs under the Narcotic Drugs &
Psychotropic Substances Act 1985 (NDPS Act). • Significance:
o India: second-largest fish producer in the world.
• Possession, sale, use, etc. of poppy straw is regulated
o Provides employment to 14 million people -
by the State Governments under the State Narcotic
harvesting, processing packaging, and
Drugs & Psychotropic Substances Rules.
distribution.
• Farmers sell the poppy straw to those licensed by the
o Major Shrimp Producing States: Andhra
State Governments to purchase poppy straw.
Pradesh, West Bengal, Odisha, Gujarat, and Tamil
Nadu.
Opium Cultivation
• Post-independence: control over cultivation and
Marine Products Exports Development Authority
manufacture of opium became responsibility of the
(MPEDA):
Central Government with effect from April, 1950.
• MPEDA: nodal coordinating, state-owned agency
• India is one among 12 countries in the world where
engaged in fishery production and allied activities.
legal cultivation of opium is permissible within the
• Formation: In 1972 under the Marine Products
ambit of the United Nations, Single Convention on
Export Development Authority Act (MPEDA), 1972.
Narcotic Drugs 1961.
• Ministry: Ministry of Commerce and Industry.
• Traditional opium-growing States: Uttar Pradesh,
• Headquartered: Kochi, Kerala.
Rajasthan, and Madhya Pradesh.
• Mandate: To increase exports of seafood including
• In these states, poppy cultivation is allowed based on
fisheries of all kinds, specifying standards, marketing,
licences issued annually by the Central Bureau of
processing, extension and training in various aspects.
Narcotics.
• It currently only extracts alkaloids from opium gum
at few facilities. E-SANTA WEB PORTAL
• In News: Recently the Union Commerce and Industry
Alkaloids Minister has inaugurated an electronic platform
• Used for medical purposes and exported to several named e-SANTA, which will connect aqua farmers
countries. and the buyers.
• Controlled: Revenue Department in the Finance
Ministry. About
• Uses: Therapeutic value and is indispensable in the • e-SANTA: Electronic Solution for Augmenting NaCSA
medical world; Homeopathy and Ayurveda or Unani farmers' Trade in Aquaculture.
systems of indigenous medicines; Used as Analgesics, • It is a digital bridge to end the market divide and will
Anti-Tussive, Anti spasmodic and as a source of act as an alternative marketing tool b/w farmers &
edible seed-oil, acts as a medicinal herb. buyers by eliminating middlemen.
• The farmers: freely list their produce and quote their
SHAPHARI SCHEME price.
• The exporters: list their requirements and also to
• In News: Recently, the Marine Products Exports
choose the products based on their requirements:
Development Authority (MPEDA) has developed a
desired size, location, harvest dates etc.
certification scheme for aquaculture products called
‘Shaphari’. • Available in many languages, which will help the
local population.
Shaphari: • Significance: It will help in RAISE -
• Shaphari (Sanskrit word) means: superior quality o Reducing Risk
of fishery products suitable for human consumption. o Awareness of Products & Markets
o Increase in Income
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OnlyIAS UDAAN PLUS: ECONOMY

o Shielding Against Wrong Practice • Establishment: Autonomous statutory body

o Ease of Processes established under the Food Safety and Standards Act,
2006 (FSS Act).
National Centre for Sustainable Aquaculture: • Headquartered in Delhi.
• Extension arm of Marine Products Export • Ministry: Ministry of Health & Family Welfare
Development Authority (MPEDA), Ministry of • Functions:
Commerce & Industry Govt. of India. o Framing of regulations
• Objective: to encourage and uplift the small and o Granting FSSAI food safety license
marginal farmers through organization of clusters o Laying down procedure and guidelines for
and best management practices in shrimp culture laboratories in food businesses
• Enables participating farmers to organize: The o To provide suggestions to the government
schedule of farm operations; Quality seed o To collect data regarding contaminants in foods
procurement; Simultaneous stocking; Water products, identification of emerging risks and
exchange; Harvesting regimes. introduction of a rapid alert system.
o Creating an information network across the
CODEX COMMITTEE ON SPICES AND CULINARY country
HERBS (CCSCH) o Promote general awareness about food safety
and food standards.
• In News: Recently, the Food Safety and Standards
Authority of India (FSSAI) inaugurated the fifth
session of the Codex Committee on Spices and LARGE AREA CERTIFICATION
Culinary Herbs (CCSCH) established under Codex • In News: Recently, the Ministry of Agriculture and
Alimentarius Commission (CAC). Farmer Welfare has conferred a land area in the
Andaman and Nicobar with organic certification. This
Codex Alimentarius: is the first large contiguous territory conferred with
• It is a collection of international food standards the organic certification under the ‘Large Area
that have been adopted by the CAC. Certification’ (LAC) scheme.
• The Standards cover all the main foods, whether
processed, semi-processed or raw, materials used in About the scheme:
the further processing of food products. • The Department of Agriculture and Farmers Welfare
• Codex provisions concern the hygienic and under its flagship scheme of Paramparagat Krishi
nutritional quality of food, including Vikas Yojna (PKVY) has launched the Large Area
microbiological norms, food additives, pesticide and Certification Scheme.
veterinary drug residues. • Paramparagat Krishi Vikas Yojana(PKVY) was
launched in 2015 with the aim to support and
Codex Committee on Spices and Culinary Herbs promote organic farming. This in turn results in the
(CCSCH): improvement of soil health.
• Formed in 2013. • Purpose: The purpose is to provide a unique and
• Main function: to elaborate worldwide standards for quick organic certification to harness the potential
spices and culinary herbs in their dried and land areas for organic products.
dehydrated state in whole, ground, and cracked or
crushed form. Process for LAC:
• It will also consult, as necessary, with other • Firstly: under the LAC, each village in the area is
international organizations in the standards considered as one cluster/group. Documentations
development process to avoid duplication. are simple and maintained village-wise.
• India is the host country and Spices Board (Ministry • Secondly: all farmers with their farmland and
of Commerce and Industry) is the Secretariat for livestock need to adhere to the standard
organising the sessions of the committee. requirements. After verification, they will get
certified as a group. Once issued they don’t need to go
Codex Alimentarius Commission (CAC): under conversion period.
• Intergovernmental body established jointly by the • Thirdly: certification is renewed on annual basis
UN’s FAO and the WHO in 1963, within the through annual verification. Annual verification is a
framework of the Joint Food Standards Programme. process of peer appraisals as per the process of PGS-
• The Secretariat of the CAC is hosted at FAO India.
headquarters in Rome.
• Objective: to protect the health of consumers and Benefits of LAC:
ensure fair practices in the food trade. • If areas having chemical input usage history are
• Meetings: regular session once a year alternating required to undergo a transition period of minimum
between Geneva and Rome. 2-3 years to qualify as organic.
• Members: Currently, it has 189 Codex Members. • During this period, farmers need to adopt standard
organic agriculture practices and keep their farms
Food Safety and Standards Authority of India (FSSAI): under the certification process.
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OnlyIAS UDAAN PLUS: ECONOMY

• On successful completion, such farms can be certified • For APMCs: interest subvention for a loan upto Rs. 2
as organic after 2-3 years. It also requires elaborate crore will be provided for each project of different
documentation and time to time verification by the infrastructure types e.g. cold storage, sorting, grading
certification authorities. and assaying units, silos, et within the same market
• Whereas under LAC requirements are simple and the yard.
area can be certified almost immediately • Power: Minister of Agriculture & Farmers Welfare to
make necessary changes with regard to addition or
Organic Farming and India: deletion of beneficiary.
• Organic Farming avoids using of synthetic inputs • Period of financial facility: extended from 4 to 6
(such as fertilizers, pesticides, hormones). Instead, it years upto 2025-26 and overall period of the scheme
relies upon crop rotations, animal manures, off-farm has been extended from 10 to 13 upto 2032-33.
organic waste and a biological system of nutrient
mobilization. Central Sector Schemes:
• 100 percent funded by the Union Government with
Related Initiatives: states
• Mission Organic Value Chain Development for North • functioning as implementing agencies.
East Region (MOVCDNER). • These schemes are mainly formulated on subjects
• Paramparagat Krishi Vikas Yojana (PKVY), etc. from the Union List.
• India now has more than 30 lakh ha area registered • In addition, the Central ministries also implement
under organic certification. Also, more and more some schemes directly in the states/UTs, which are
farmers are joining the movement slowly. called Central Sector Schemes, but resources under
• As per the international survey report (2021) India these schemes are not generally transferred to states.
ranks at 5th place in terms of area. Further, India is at
the top in terms of the total number of organic Centrally Sponsored Schemes:
producers (the base year 2019). • A certain percentage of the funding is borne by
• Sikkim became the first State in the world to the Centre and the states in fixed ratios and the
become fully organic in 2016. implementation is done by the state governments.
• CSSs are formulated in subjects from the State List
AGRICULTURE INFRASTRUCTURE FUND (AIF) to encourage states to prioritize in areas that require
more attention.
• In News: Recently, the Union Cabinet has given
approval to a pan India central sector scheme i.e.
Agriculture Infrastructure Fund, to inject formal MACS 1407
credit into farm and farm-processing based activities. • In News: Recently, Indian Scientists have developed
a high-yielding and pest-resistant variety of soybean,
About the Fund: called MACS 1407.
• AIF is a Central Sector Scheme.
• Medium to long term debt financing facility for About MACS 1407
investment in viable projects for post-harvest • It is a high-yielding and pest-resistant variety of
management soybean.
• Infrastructure and community farming assets • Cultivation: It is suitable for cultivation in the states
through interest subvention and financial support. of Assam, West Bengal, Jharkhand, Chhattisgarh and
• Eligible beneficiaries include: Farmers, Marketing North-Eastern states.
Cooperative Societies, Joint Liability Groups (JLG),
Multipurpose Cooperative Societies, Agri- Key Features:
entrepreneurs, Start-ups, and Central/State agency • It requires an average of 43 days for 50 % flowering.
or Local Body sponsored Public-Private Partnership Further, it takes 104 days to mature from the date of
Projects. sowing.
• Management of the fund: • It has white coloured flowers, yellow seeds and black
o It will be managed and monitored through an hilum.
online Management Information System (MIS) • Its seeds have 19.81 % oil content, 41 % protein
platform. content and show good germinability.
o The National, State and District level Monitoring • Advantages: High Yielding, Pest Resistant and
Committees will be set up to ensure real-time Suitable for mechanical harvesting
monitoring and effective feed-back.
Significance:
Modifications: • In 2019, India produced around 90 million tons of
• Eligibility extended to State Agencies/APMCs, soybean, widely cultivated as oil seeds as well as a
National & State Federations of Cooperatives, cheap source of protein for animal feed and many
Federations of Farmers Producers Organizations packaged meals.
(FPOs) and Federations of Self Help Groups (SHGs). • India is striving to be among the world’s major
producers of soybean.
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OnlyIAS UDAAN PLUS: ECONOMY

• High-yielding, disease resistant varieties of the Mission for Integrated Development of Horticulture
legume can help achieve this target. (MIDH) Scheme
• Ministry: Ministry of Agriculture and Farmers’
INDIA BEGINS EXPORTS OF ORGANIC MILLETS Welfare, GOI.
• Centrally Sponsored scheme for the holistic growth
• In News: In a major boost to exports of organic
and development of the Indian horticulture sector,
products from the country, the first consignment of
covers vegetables, fruits, roots and tuber crops,
millets grown in the Himalayas would be exported to
aromatic plants, flowers, spices, bamboo, coconut,
Denmark.
cashew and cocoa.
• Also provides technical support and advice to
About
state horticultural missions, Rashtriya Krishi Vikas
• APEDA, in collaboration with Uttarakhand
Yojana (RKVY), Saffron Mission and the National
Agriculture Produce Marketing Board (UKAPMB) &
Mission for Sustainable Agriculture (NMSA).
Just Organik, an exporter, has sourced & processed
• Funding Pattern: GoI contributes 60%, of total
ragi (finger millet), and jhingora (barnyard millet)
outlay for developmental programmes in all the
from farmers in Uttarakhand for exports, which
states except states in North East and Himalayas,
meets the organic certification standards of the
40% share is contributed by State Governments. In
European Union.
the case of North Eastern States and Himalayan
• Millets are gaining a lot of popularity globally because
States, GOI contributes 90%.
of high nutritive values and being gluten free also.
Sub Schemes:
Agricultural and Processed Food Products Export
• National Horticulture Mission (NHM).
Development Authority (APEDA)
• Horticulture Mission for North East & Himalayan
• Established: under the Agricultural and Processed
States (HMNEH).
Food Products Export Development Authority Act,
1985. • National Bamboo Mission (NBM).
• Ministry & Headquarter: Ministry of Commerce and • National Horticulture Board (NHB).
Industry. Headquarters in New Delhi. • Coconut Development Board (CDB).
• Functions: mandated with the responsibility of • Central Institute for Horticulture (CIH).
export promotion and development of the scheduled
products viz. fruits, vegetables, meat products, dairy PRADHAN MANTRI KISAN SAMMAN NIDHI (PM -
products, alcoholic and non-alcoholic beverages etc. KISAN)
Also responsibility to monitor import of sugar. • In News: Recently, the Prime Minister released the
8th instalment of financial benefit under Pradhan
National Programme for Organic Production (NPOP) Mantri Kisan Samman Nidhi (PM-KISAN).
• Implemented by APEDA since its inception in 2001 as
notified under the Foreign Trade (Development and About
Regulations) Act, 1992. • Centre transfers an amount of Rs 6,000 per year,
• NPOP covers standards for crops and their products, in three equal instalments, directly into the bank
live stocks and poultry products, aquaculture, accounts of all landholding farmers irrespective of
apiculture etc. the size of their land holdings.
• Recognized by the Food Safety Standard Authority of • Launched: in February 2019
India (FSSAI) for trade of organic products in the • Objective: Income support to farmers for easing
domestic market. their liquidity needs to facilitate timely access to
• NPOP certification has been recognized by the inputs.
European Union and Switzerland • Funding: Central Sector Scheme with 100% funding
• It also facilitates export of Indian organic products to from the Government of India.
the United Kingdom even in the post Brexit phase. • Implementation: Implemented by the Ministry of
Agriculture and Farmers Welfare.
MISSION FOR INTEGRATED DEVELOPMENT OF • Identification of Beneficiaries: The entire
HORTICULTURE responsibility of identification of beneficiary farmer
• In News: Recently, the Ministry of Agriculture and families rests with the State/UT Governments.
Farmers’ Welfare has provided an enhanced
allocation of Rs. 2250 Crore for the year 2021-22 for PM-KISAN Mobile App:
‘Mission for Integrated Development of Horticulture’ • Developed and designed by the National
(MIDH). Informatics Centre in collaboration with the Ministry
• Horticulture: A branch of plant agriculture dealing of Electronics and Information Technology
with garden crops, generally fruits, vegetables, and • Function: Farmers can view the status of their
ornamental plants. M.H. Marigowda is considered the application, update or carry out corrections of their
Father of Indian Horticulture. Aadhaar cards and also check the history of credits to
their bank accounts.

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OnlyIAS UDAAN PLUS: ECONOMY

NANO UREA LIQUID production, post-harvest management, logistics,

marketing and branding.
• In News: Recently, Indian Farmers Fertiliser
• To leverage geographical specialisation and promote
Cooperative Limited(IFFCO) has launched the
integrated and market-led development.
world’s first Nano Urea Liquid.
• To converge with other initiatives of the Government
such as the Agriculture Infrastructure Fund.
Nano Liquid Urea:
• Clusters: MoA&FW has identified 53 horticulture
• Nano Urea Liquid is a nutrient to provide nitrogen
clusters, of which 12 have been selected for the pilot
to plants as an alternative to conventional urea.
launch of the programme-
• Objective: To enable Indian farmers to prosper
o Apple: Shopian (J&K) and Kinnaur (H.P.)
through timely supply of reliable, high quality
o Mango: Lucknow (U.P.), Kutch (Gujarat) and
agricultural inputs and services in an
Mahbubnagar (Telangana)
environmentally sustainable manner and to
o Banana: Anantpur (A.P.) and Theni (T.N.)
undertake other activities to improve their welfare.
o Grapes: Nasik (M.H.)
• Developed by: Nano Urea Liquid has been developed
o Pineapple: Siphahijala (Tripura)
indigenously through proprietary technology at
o Pomegranate: Solapur (M.H.) and Chitradurga
IFFCO”s Nano Biotechnology Research Centre
(Karnataka)
(NBRC) in Gujarat.
o Turmeric: West jaintia Hills (Meghalaya).
• Efficacy Trials: IFFCO had conducted around 11,000
farmer field trials (FFT’s) on more than 94 crops
across India to test the efficacy of nano urea. The SEED MINIKIT PROGRAMME
trials had shown an average 8% increase in yield. • In News: Recently, the Seed Minikit Programme was
launched by the Ministry of Agriculture.
Benefits:
• Can curtail the requirement of urea by at least Seed Minikit:
50%. This will in turn reduce India’s dependence on • It consists of higher yielding varieties of seeds of
urea imports. Pulses and oilseeds that are distributed to farmers.
• Use by farmers will boost balanced nutrition • Funding: The programme is wholly funded by the
programs by reducing the excess use of Urea Center through the National Food Security Mission.
application in the soil → help make the crops • Nodal Agencies: The seed mini-kits are being
stronger, healthier and protect them from the lodging provided by the following central agencies –
effect. o National Seeds Corporation (NCS)
• Effectiveness of the Nano Urea Liquid is over 80%. o NAFED
• Nano Urea Liquid will be cost-effective as it will be o Gujarat State Seeds Corporation
cheaper, this will help in increasing farmers’ income.
• Nano Urea Liquid will have a positive impact: Benefits:
o Quality of underground water • It is a major tool for introducing new varieties of
o Reduction in global warming with an impact on seeds in the farmers’ fields.
climate change and • It will ensure better harvest and better income.
o Sustainable development. • It is instrumental for increasing the seed replacement
rate
HORTICULTURE CLUSTER DEVELOPMENT • The distribution is free of cost
PROGRAMME
Seed Replacement Rate (SRR):
• In News: The Ministry of Agriculture and Farmers
Out of the total area of a crop planted in a season, SRR is
Welfare has launched the Horticulture Cluster
the percentage of total area sown using certified/quality
Development Programme (CDP) in order to promote
seeds other than the farm-saved seed (the practice of
the export of horticultural produce.
saving seeds to plant in the next season).
Cluster Development Programme (CDP):
Pulses and Oilseeds Production in India:
• Programme: It is a central sector programme aimed
• Oilseeds production has increased from 27.51 million
at growing and developing identified horticulture
tonnes in 2014-15 to 36.57million tonnes in 2020-21.
clusters to make them globally competitive.
• On the other hand, pulses production has increased
• Horticulture cluster: regional/geographical
from 17.15 million tonnes in 2014-15 to 25.56 million
concentration of targeted horticulture crops.
tonnes in 2020-21.
• Implementation By: National Horticulture Board
• However, India still imports a lot of pulses and edible
(NHB) of the Ministry of Agriculture and Farmers’
oils to meet domestic demand.
Welfare.
National Food Security Mission (NFSM):
Objective:
• Launched in 2007-08 by the Ministry of Consumer
• To address all major issues related to the Indian
Affairs.
horticulture sector including pre-production,

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OnlyIAS UDAAN PLUS: ECONOMY

• Aim: To increase the production of rice, wheat and • Purpose: To provide seed capital assistance to
pulses through area expansion and productivity members of urban Self Help Groups working in the
enhancement + restoring soil fertility and food processing sector in India.
productivity + Creating employment opportunities + • Aim:
enhancing farm level economy. o To enhance the competitiveness of existing
individual micro-enterprises in the unorganized
SUB-MISSION ON AGRICULTURAL segment of the food processing industry.
MECHANIZATION o To promote formalization of the sector and
provide support to Farmer Producer
• In News: Recently, the Government of India has
Organizations, Self Help Groups, and Producers
released funds for various activities of Farm
Cooperatives along their entire value chain.
Mechanization under the Sub-Mission on Agricultural
• Seed Capital Limit: The Self Help Groups(SHGs) can
Mechanization (SMAM) scheme.
avail the seed capital assistance of Rs.40,000 per SHG
member under the PMFME Scheme.
About
• Launched: In 2014-15, by Ministry of Agriculture
Features:
and Farmers Welfare
• One District One Product
• Objectives: Increasing the reach of farm
• Support for Common Infrastructure
mechanization to small and marginal farmers and to
the regions & difficult areas where farm power • Support to SHGs, FPOs, Co-operative & Individual
availability is low. Micro food Enterprises
• Proposals: to established Village Level farm • Seed Capital for Self Help Groups
Machinery Bank (VLFMB), Custom Hiring Centres • Training & Research Support
(CHC) and High Tech Hubs (HTH) in order to facilitate • Support for Capacity Building
easy availability of farm implements and machinery • Branding & Marketing Support
for hire by farmers.
• Multilingual Mobile App: 'CHC (Custom Hiring DAY-NULM
Centres)- Farm Machinery' which connects farmers • Centrally Sponsored Scheme
with Custom Hiring Service Centres situated in their • Launched in 2014
locality. • Aims: To uplift urban poor by enhancing sustainable
livelihood opportunities through skill development.
Agriculture/Farm Mechanization: • Intended Beneficiaries: Urban poor (street
• Mechanised agriculture is the process of using vendors, slum dwellers, homeless, rag pickers),
agricultural machinery to mechanise the work of unemployed and differently-abled.
agriculture. • Provides: skill training and employment to the urban
• To boost up mechanization in the agriculture sector, poor, interest subsidy of 5% – 7% for setting up
improved agricultural implements and machinery individual micro-enterprises with the loan of up to 2
are essential inputs. lakhs and for group enterprises with a loan limit of up
to Rs.10 lakhs.
Level of farm Mechanization:
• India stands at about 40-45% with states such as HARIT DHARA
UP, Haryana and Punjab having very high • In News: Recently, the Indian Council of Agricultural
mechanization levels while NE states having Research (ICAR) institute has developed an anti-
negligible mechanization. methanogenic feed supplement ‘Harit Dhara’.
• India’s farm mechanization level is still low as
compared to countries such as the US (95 %), Brazil Harit Dhara Supplement
(75%) and China (57%). • It is prepared using condensed and hydrolysable
tannin-rich plant-based sources abundantly available
PMFME SCHEME SEED CAPITAL MODULE in the country.
• In News: Recently, the Ministry of Food Processing • Significance of this supplement: This can cut down
Industries has launched the Seed Capital Module cattle methane emissions by 17-20% and can also
under Pradhan Mantri Formalisation of Micro food result in higher milk production.
processing Enterprises (PMFME) to help Self Help
Groups (SHGs). Benefits:
• It decreases the population of protozoa microbes in
About the rumen, responsible for hydrogen production and
• Launched on the Deendayal Antyodaya Yojana- making it available to the archaea (structure similar
National Urban Livelihoods Mission(DAY-NULM) MIS to bacteria) for reduction of CO2 to methane.
Portal. • Fermentation after using this supplement will help
produce more propionic acid, which provides more
energy for lactose (milk sugar) production and body
weight gain.
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OnlyIAS UDAAN PLUS: ECONOMY

• Reduces methane production Animal Husbandry Infrastructure Development

Fund:
Methane Emission From Cattle: • It is a Central Sector Scheme.
• Methane is produced by animals having rumen. • Launched by the Ministry of Animal Husbandry,
o Rumen is the first of the four stomachs where the Fisheries, and Dairying.
cattle eat plant material, cellulose, fibre, starch • Aim:
and sugars → get fermented or broken down by o To facilitate incentivization of investments for
microorganisms prior to further digestion and o Dairy processing and value addition
nutrient absorption. infrastructure
o Carbohydrate fermentation leads to production o Meat processing and value addition
of CO2 and hydrogen → used by microbes infrastructure and
(Archaea) present in the rumen to produce o Animal Feed Plant.
methane. • Eligibile Entities: Farmer Producer
• An average lactating cow or buffalo in India emits Organization(FPO); Private companies; Individual
around 200 litres of methane per day, while it is 85- entrepreneurs; Section 8 companies; Micro Small and
95 litres for young growing heifers and 20-25 litres Medium Enterprises.
for adult sheep. • Benefits:
o Loan Contribution: Beneficiaries → 10% margin
Government Initiatives related to Livestock: money as an investment. The balance of 90% →
• Animal Husbandry Infrastructure Development scheduled banks.
Fund (AHIDF): Set up to support private investment o Interest Subvention: The GoI will provide a 3%
in Dairy Processing, value addition and cattle feed interest subvention to eligible beneficiaries.
infrastructure. o Loan Moratorium: 2 years moratorium period for
• Rashtriya Gokul Mission: Aimed at developing and the principal loan amount and 6 years repayment
conserving indigenous breeds of bovine population, period thereafter.
also to enhance milk production and to make it more o Credit Guarantee Fund: NABARD would
remunerative to the farmers. maintain a Credit Guarantee Fund. It would
• National Livestock Mission: Launched in the year provide to those sanctioned projects which are
2014-15 to ensure quantitative and qualitative covered under MSME defined ceilings. Guarantee
improvement in livestock production systems and Coverage → up to 25% of the Credit facility of the
capacity building of all stakeholders. borrower.
• National Artificial Insemination Programme: To
prevent the spread of certain diseases which are BHARTIYA PRAKRITIK KRISHI PADHATI
genital in nature, thereby enhancing the efficiency of
• In News: Recently, the Union Minister of Agriculture
the breed.
has provided useful information regarding the
Bhartiya Prakritik Krishi Padhati (BPKP).
DAIRY INVESTMENT ACCELERATOR
• In News: Recently, the Department of Animal Bhartiya Prakritik Krishi Padhati (BPKP)
Husbandry and Dairying(DAHD) has set up a Dairy • Natural farming is promoted as BPKP under the
Investment Accelerator under its Investment centrally sponsored scheme Paramparagat Krishi
Facilitation Cell. Vikas Yojana (PKVY).
• Mainly emphasizes the exclusion of all synthetic
About Dairy Investment Accelerator: chemical inputs and promotes on-farm biomass
• It is a cross-functional team constituted to serve as recycling.
the interface with investors. It shall provide support • Stresses biomass mulching; use of cow dung-urine
across the investment cycle by: formulations; plant-based preparations and time to
o Offering specific inputs for evaluation of time working of soil for aeration.
investment opportunities • Financial assistance of Rs 12200/ha for 3 years is
o Addressing queries about the application to provided for cluster formation, capacity building, and
govt. schemes continuous handholding by trained personnel,
o Connecting with strategic partners certification, and residue analysis.
o Providing on-ground assistance with state
departments & relevant authorities. Paramparagat Krishi Vikas Yojna:
• Functions: • It is a sub-component of Soil Health Management
o To facilitate direct interactions with government (SHM) scheme under National Mission of
officials and connect with other players in the Sustainable Agriculture(NMSA).
Dairy Industry. • Aim: development of sustainable models of organic
o It would also generate awareness among farming through a mix of traditional wisdom and
investors about the Animal Husbandry modern science.
Infrastructure Development fund (AHIDF).

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OnlyIAS UDAAN PLUS: ECONOMY

• Objective: to ensure long term soil fertility build-up, • It will involve raising the area under oil palm
resource conservation and helps in climate change cultivation to 10 lakh hectares by 2025-26 and 16.7
adaptation and mitigation. lakh hectares by 2029-30.
• Key features of PKVY: • Oil palm farmers will be provided financial assistance
o Organic farming is promoted through the and will get remuneration under a price and viability
adoption of the organic village by cluster formula.
approach and PGS certification. • The Viability Formula is a MSP-type mechanism and
o Fifty or more farmers will form a cluster having the government will fix this at 14.3% of Crude Palm
50-acre land to take up the organic farming Oil (CPO) price.
under the scheme.
o Produce will be pesticide residue free and will Objectives of the scheme:
contribute to improving the health of the • Achieve self-reliance in edible oil.
consumer. • Harness domestic edible oil prices that are dictated
by expensive palm oil imports.
NATIONAL INNOVATIONS IN CLIMATE • To raise the domestic production of palm oil by three
RESILIENT AGRICULTURE times to 11 lakh MT by 2025-26.
• In News: Recently, Union Minister of Agriculture and • Focus: Emphasis will be in India’s north-eastern
Farmers Welfare has informed Rajya Sabha about states and the Andaman and Nicobar Islands due to
National Innovations in Climate Resilient Agriculture the conducive weather conditions in the regions.
(NICRA).
Benefits and significance of the scheme:
NICRA: • Rise in Yields
• It is a network project of the Indian Council of • Reduce dependence on imports
Agricultural Research (ICAR) • Raise Farmers Income
• Launched in February 2011.
• Aim: To enhance the resilience of Indian agriculture Palm oil:
to climate change and climate vulnerability through • Palm oil is currently the world’s most consumed
strategic research and technology demonstration. vegetable oil.
• Research on adaptation and mitigation covers: • It is used extensively in the production of detergents,
crops, livestock, fisheries and natural resource plastics, cosmetics, and biofuels.
management. • Top consumers of the commodity are India, China,
and the European Union (EU).
Objectives:
• To enhance the resilience of Indian agriculture E-GOPALA APP
• To demonstrate site specific technology packages on • In News: Recently, the web version of e-GOPALA
farmers’ fields for adapting to current climate risks application developed by National Dairy
• To enhance the capacity building of scientists and Development Board (NDDB) has been launched to aid
other stakeholders in climate resilient agricultural dairy farmers.
research and its application. • It is a comprehensive breed improvement
marketplace and information portal for direct use of
Components: farmers.
• Strategic research on adaptation and mitigation
• Technology demonstration on farmers’ fields to cope Features of the app:
with current climate variability • Managing livestock including buying and selling of
• Sponsored and competitive research grants to fill disease-free germplasm in all forms (semen,
critical research gaps embryos, etc.).
• Capacity building of different stakeholders. • Availability of quality breeding services (Artificial
Insemination, veterinary first aid, vaccination,
NATIONAL MISSION ON EDIBLE OIL-OIL treatment, etc.).
PALM (NMEO-OP) • Guiding farmers for animal nutrition and treatment
of animals using appropriate ayurvedic
• In News: Recently, the Prime Minister announced a medicine/ethnoveterinary medicine.
National Mission on Edible Oil-Oil Palm (NMEO-OP),
• Providing a mechanism to send alerts and inform
with an investment of over Rs 11,000 crore over a
farmers about various government schemes and
five-year period.
campaigns in the area.
About
Pradhan Mantri Matsya Sampada Yojana:
• It is a new Centrally Sponsored Scheme and
• Flagship scheme for focused and sustainable
proposed to have an additional 6.5 lakh hectares for
development of the fisheries sector in the country as
palm oil by 2025-26.
a part of the Atma Nirbhar Bharat Abhiyan.

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OnlyIAS UDAAN PLUS: ECONOMY

• Nodal Ministry: Department of Fisheries, Ministry of • Current Production: fish production is 130 lakh
Animal Husbandry, Dairying and Fisheries. tones and export worth Rs 46,000 crore.
• Aim: • GoI has set a goal of 22 million tonnes of fish
o Enhance fish production by an additional 70 lakh production and export to the tune of Rs one lakh
tonne and increase fisheries export earnings to crore by 2025.
Rs.1,00,000 crore by 2024-25.
o Double the incomes of fishers and fish farmers. National Cooperative Development Corporation
o Reduce post-harvest losses from 20-25% to (NCDC):
about 10%. • Established: by an Act of Parliament in 1963 as a
• Components: Central Sector Scheme (CS) and statutory Corporation under the Ministry of
Centrally Sponsored Scheme (CSS). Agriculture & Farmers Welfare.
• Other significant Features: • Objectives: planning and promoting programmes for
o The scheme Adopt ‘Cluster or Area-based production, processing, marketing, storage, export
Approaches’ and create fisheries clusters and import of agricultural produce, foodstuffs,
through backward and forward linkages. industrial goods, livestock and certain other notified
o It focuses especially on employment generation commodities and services on cooperative principles.
activities such as seaweed and ornamental fish • Its Management vests in 51 members widely
cultivation. represent the General Council to give shape to its
policies and programmes and Board of Management.
LINAC-NCDC FISHERIES BUSINESS INCUBATION
CENTRE RIVER RANCHING PROGRAMME
• In News: Recently, the Union Minister of Fisheries • In News: Recently, the Union Minister for Fisheries,
has inaugurated the country’s first-of-its-kind, Animal Husbandry & Dairying, is set to launch the
dedicated business incubator to be known as LINAC- River Ranching Programme in Uttar Pradesh under
NCDC Fisheries Business Incubation Centre(LlFlC) in the Namami Gange Programme.
Haryana’s Gurugram.
River Ranching:
About LINAC- NCDC Fisheries Business Incubation • It was introduced as special activity under the
Centre (LIFIC): ‘Pradhan Mantri Matsya Sampada Yojana’
• Implementing Agency: National Cooperative (PMMSY) scheme to augment and enhance fish
Development Corporation (NCDC). production and productivity by expanding,
• NCDC has identified the first batch of ten intensifying, diversifying and utilizing land & water
incubates from four states: Bihar, Himachal productively.
Pradesh, Gujarat and Maharashtra. • It is a form of aquaculture,
• Out of them, 6 are from newly-created Fish o In which a population of a fish species (such as
Farmers Producer Organizations with the support salmon) is held in captivity for the first stage of
of the financial grant under the PMMSY. their lives.
• Centre will serve as a ‘milestone’ in future for the o After that released, and later harvested as adults
fisheries sector which is being given a big push when they return from the sea to their
under the central flagship Pradhan Mantri Matsya freshwater birthplace to spawn.
Sampada Yojana (PMSSY). • Implementing agency: National Fisheries
• Aim: To nurture fisheries start-ups under real Development Board, Hyderabad
market-led conditions.
• Services Provided by the LIFIC: Objective:
o The centre will provide hand holding such as • To sustain and conserve the biodiversity in the river.
training, converting entrepreneurial ideas into • Facilitate regular stocking of fingerlings of cultivable
business models. carps to enhance productivity
o It will also share seed money to the new as well • Increase fish production
as existing business entrepreneurs who are keen • Enhance income and livelihood opportunities to
to make big in the fisheries segment. communities’ dependent on these resources
• Significance: Setting up this first of business
incubation centre for fisheries in India is a step in this Significance:
direction to achieve the ambitious goal. • Helps in achieving sustainable fisheries, reducing
habitat degradation, conserving biodiversity,
Fisheries Sector in India: maximising social-economic benefits and would also
• Fisheries is a sunrise industry in India, growing at remove factors causing pollution.
seven per cent annually. • Due to releasing different species of fish in the river,
• India ranks second in the world in total fish it destroy factors that increase the level of nitrogen.
production as per 2018-19 data. Of this, the inland • It will also aid in maintaining the cleanliness of the
fisheries sector contributes nearly 70% and the rest river as they feed on organic remnants.
comes from the marine sector.
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OnlyIAS UDAAN PLUS: ECONOMY

MINIMUM SUPPORT PRICE • Now the plants can “tolerate” application of the
herbicide, and hence it kills only the weeds.
• In News: Recently, the Cabinet Committee on
• Note: as there is no foreign gene involved in the
Economic Affairs (CCEA) has approved the increase
process, the herbicide-tolerance is through mutation
in the MSP for all mandated Rabi crops for the Rabi
breeding. Thus, it is not a Genetically modified
Marketing Season 2022-23.
organism.
Minimum Support Prices (MSP):
Advantages:
• Minimum price set by the Government to protect
• Direct Seeding of Rice Activity: The new varieties
farmers from the price volatility of Agri commodities.
simply replace water with Imazethapyr and there’s
• Recommended: Commission for Agricultural Costs
no need for nursery, puddling, transplanting and
and Prices (CACP)
flooding of fields.
• Approved: Cabinet Committee on Economic Affairs
• Cheaper Option: DSR cultivation is currently based
(Headed by PM)
on two herbicides, Pendimethalin and Bispyribac-
• Nodal Agency: Food Corporation of India (FCI)
sodium.
• As per Swaminathan Commission for Agricultural
• Safer Option: Imazethapyr, moreover, has a wider
Cost and Prices (CACP), there are three types of
weed-control range and is safer, as the ALS gene isn’t
production costs:
present in humans and mammals.
1. A2: Actual paid out cost.
2. A2+FL: Actual paid out cost plus imputed value
Direct Seeding of Rice (DSR):
of family labour.
• Method under which pre-germinated seeds are
3. C2: Comprehensive cost including imputed rent
directly drilled into the field by a tractor-powered
and interest on owned land and capital.
machine.
• No nursery preparation or transplantation involved
MSP is declared on:
in this method.
• Cereals (7): Paddy, Wheat, Barley, Jowar, Bajra, Maise
• Water is replaced by real chemical herbicides and
and Ragi
farmers have to only level their land and give one pre-
• Pulses (5): Gram, Arhar/ Tur, Moong, Urad and Lentil
sowing irrigation.
• Oilseeds (8): Groundnut, Rapeseed/Mustard, Toria,
• The Punjab Agricultural University (PAU) in
Soyabean, Sunflower seed, Sesamum, Safflower seed
Ludhiana has developed a ‘Lucky Seed Drill’ that can
and Niger seed
both sow seeds and simultaneously spray herbicides
• Copra
to control weeds.
• De-husked coconut
• Raw cotton Advantages of DSR:
• Raw jute • Water savings because the first irrigation under DSR
• Sugarcane (Fair and remunerative price) is necessary only 21 days after sowing.
• Virginia flu cured (VFC) tobacco. • Less requirement of labour.
• • Reduction in methane emissions and global warming
Note: potential
• CACP considers both (A2+FL) and C2 costs while • Little disturbance to soil structure
recommending MSPs. • Enhanced system productivity
• C2 costs are used as benchmark reference costs
(opportunity costs) to see if the MSPs recommended Disadvantages of DSR:
by them at least cover these costs in some of the • Main issue is the availability of herbicides.
major producing States. • Seed requirement for DSR is also higher than
transplanting.
PUSA BASMATI 1979 AND PUSA BASMATI 1985 • Land levelling is compulsory in DSR, therefore,
• In News: Recently, the Indian Agricultural Research increases the cost.
Institute (IARI) has developed the country’s first- • The DSR method is not suitable on certain types of
ever non-GM (genetically modified) herbicide- soil and in such fields only transplanting methods
tolerant rice varieties (Pusa Basmati 1979 and Pusa work.
Basmati 1985).
Genetically Modified Organisms (GMOs):
New Varieties of Rice: • It can be defined as organisms in which the genetic
• It contain a mutated Aceto Lactate Synthase (ALS) material (DNA) has been altered in a way that does
gene helps farmers to spray Imazethapyr, a broad- not occur naturally by mating and/or natural
spectrum herbicide, to control weeds. recombination.
• Imazethapyr: effective against a range of broadleaf, • The technology referred to as the “modern
grassy and sedge weeds, can’t be used on normal biotechnology” or “gene technology”, also it is known
paddy, as the chemical does not distinguish b/w the as “recombinant DNA technology” or “genetic
crop and the invasive plants. engineering”.
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OnlyIAS UDAAN PLUS: ECONOMY

• It allows selected individual genes to be transferred eligible agriculture products, shall be covered under
from one organism into another, also between non- this scheme.
related species. • The assistance, at notified rates, will be available for
the export of eligible agriculture products to the
NATIONAL DIGITAL LIVESTOCK MISSION permissible countries, as specified from time to time.
• Assistance would be provided in cash through a
• In News: Recently, the Union Minister of State
direct bank transfer as part reimbursement of freight
Fisheries, Animal Husbandry & Dairying unveiled the
paid.
National Digital Livestock Mission Blueprint.
Major changes have been made in the revised scheme:
About National Digital Livestock Mission:
• Dairy products, which were not covered under the
• It is a digital platform developed jointly by the
earlier scheme, will be eligible for assistance under
Department of Animal Husbandry and Dairying
the revised scheme
(DAHD) and NDDB on the foundation of the existing
• Rates of assistance have been increased, by 50% for
Information Network for Animal Productivity and
exports by sea and by 100% for exports by air.
Health (INAPH).
• Focus: The unique identification of all livestock,
which will be the foundation for all the state and KRISHI UDAN 2.0 SCHEME
national level programmes including domestic and • In News: Recently, the Union Minister of Civil
international trade. Aviation has released Krishi Ude Desh Ka Aam
• Aims: to create a farmer-centric, technology-enabled Naagrik (UDAN) 2.0 to facilitate movement of
ecosystem where the farmers can realize better agricultural produce by air.
income through livestock activities with the right
information. About Krishi UDAN:
• Benefits: farmers will be able to effortlessly access • Krishi UDAN was launched in August 2020, on
the markets, irrespective of their location or holdings international and national routes to assist farmers in
through this digital platform as a wide range of transporting agricultural products so that it improves
stakeholders will be connected in this ecosystem. their value realisation.
• System includes: robust animal breeding systems, • Krishi UDAN 2.0 will focus on transporting
nutrition, disease surveillance, disease control perishable food products from the hilly areas,
programmes and a traceability mechanism for north-eastern states and tribal areas.
animals and animal products. • Implementation: at 53 airports across the country
mainly focusing on northeast and tribal regions and
National Livestock Mission (NLM) is likely to benefit farmers, freight forwarders and
• Introduced: In 2014-15 airlines.
• Initiative: Ministry of Agriculture and Farmers’ • Opted airports not only provide access to regional
Welfare, introduced in 2014-15. domestic markets but also connect them to
• Objective: sustainable development of the livestock international gateways of the country.
sector.
• The livestock sector in the country has been growing Features:
at a compound annual growth rate of 8.15% from • Facilitating and incentivizing movement of Agri-
2014-15 to 2019-20. produce by air transportation: Full waiver of
• Significance: employment generation, Landing, Parking, TNLC and RNFC charges for Indian
entrepreneurship development, increase in per freighters and P2C at selected Airports. Primarily,
animal productivity and thus targeting increased focusing on NER, Hilly, and tribal regions.
production of meat, goat milk, egg and wool. • Strengthening cargo-related infrastructure at
airports and off airports: Facilitating the
TRANSPORT AND MARKETING ASSISTANCE development of a hub and spoke model and a freight
(TMA) SCHEME grid.
• Concessions sought from other bodies: Seek
• In News: Recently, the Centre has revised “Transport
support and encourage States to reduce Sales Tax to
and Marketing Assistance” (TMA) scheme for
1% on aviation fuels for freighters / P2C aircraft as
‘Specified Agriculture Products’
extended in UDAN flights.
• Resources-Pooling through establishing
About TMA Scheme:
Convergence mechanism: Collaboration with other
• It was introduced in 2019 to provide assistance for
government departments and regulatory bodies.
the international component of freight, to mitigate
• Technological convergence: Development of E-
the disadvantage of higher freight costs faced by the
KUSHAL (Krishi UDAN for Sustainable Holistic Agri-
Indian exporters of agriculture products.
Logistics).
• All exporters, duly registered with relevant Export
Promotion Council as per Foreign Trade Policy, of
E-Kaushal:

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OnlyIAS UDAAN PLUS: ECONOMY

• It is an online platform named E-KUSHAL (Krishi Creating and rejuvenating traditional water
Udaan for Sustainable Holistic Agri-Logistics) storage systems like Jal Mandir (Gujarat); Khatri,
• Objective: to facilitate information dissemination to Kuhl (H.P.); Zabo (Nagaland); Eri, Ooranis (T.N.);
all stakeholders regarding the transportation of Dongs (Assam); Katas, Bandhas (Odisha and
agricultural produce. M.P.) etc. at feasible locations.
• The ministry has also proposed convergence of E- o PMKSY (Per Drop More Crop): Promoting
KUSHAL with the National Agriculture Market (e- efficient water conveyance and precision water
NAM). application devices like drips, sprinklers, pivots,
rain - guns in the farm (Jal Sinchan). Construction
Airports under the scheme (Proposed timeline): of micro irrigation structures to supplement
• 2021 – 2022: Agartala, Srinagar, Dibrugarh, source creation activities including tube wells
Dimapur, Hubballi, Imphal, Jorhat, Lilabari, Lucknow, and dug wells.
Silchar, Tezpur, Tirupati, Tuticorin. o PMKSY (Watershed Development): Effective
• 2022 – 2023: Ahmedabad, Bhavnagar, Jharsuguda, management of runoff water and improved soil &
Kozhikode, Mysuru, Puducherry, Rajkot, Vijayawada. moisture conservation activities such as ridge
• 2023 – 2024: Agra, Darbhanga, Gaya, Gwalior, area treatment, drainage line treatment, rain
Pakyong, Pantnagar, Shillong, Shimla, Udaipur, water harvesting.
Vadodara.
• 2024 – 2025: Holangi, Salem SEED VILLAGE PROGRAMME
• In News: Recently, The Ministry of Agriculture and
7 focus routes & products: Farmers Welfare has informed Lok Sabha about the
• Babycorn: Amritsar – Dubai Seed Village Programme (Beej Gram Yojana).
• Lichis: Darbhanga – Rest of India
• Organic produce: Sikkim – Rest of India About Seed Village Programme:
• Seafood: Chennai, Vizag, Kolkata – Far East • It was launched by the Ministry of Agriculture and
• Pineapple: Agartala – Delhi & Dubai Farmers Welfare in 2014-15.
• Mandarin & Oranges: Dibrugarh – Delhi & Dubai • The programme is a key component of the Sub-
• Pulses, fruits & vegetables: Guwahati – Hong Kong Mission on Seeds & Planting Materials.
• Aim: To upgrade the quality of farmer’s saved seeds.
PRADHAN MANTRI KRISHI SINCHAYEE YOJANA • Under this, financial assistance is available for up to
one acre per farmer for distribution of
• In News: Recently, the Cabinet Committee on
foundation/certified seeds at:
Economic Affairs chaired by the Prime Minister has
o 50% of seed cost for cereal crops
approved the implementation of Pradhan Mantri
o 60% for pulses, oilseeds, fodder, and green
Krishi Sinchayee Yojana (PMKSY) for 2021-26.
manure crops
About PMKSY:
Implementing Agencies:
• Launched in 2015
• The implementing agencies will be State
• Centrally Sponsored Scheme: providing central
Departments of Agriculture, State Agriculture
grants to the State Governments for specific activities
Universities, Krishi Vigyan Kendras, State Seeds
(90:10 for NE states & 75:25 for rest).
Corporation, National Seeds Corporation, State
• Objective:
Farms Corporation of India (SFCI), State Seeds
o To achieve convergence of investments in
Certification Agencies, Department of Seed
irrigation at the field level
Certification.
o Expand cultivable area under assured irrigation
• One implementing agency will be identified for the
o Improve on-farm water use efficiency to reduce
area/locality and is to be authorized by the State
wastage of water
Government.
o Enhance the adoption of precision-irrigation and
other water-saving technologies
Objectives:
• In 2020, the Ministry of Jal Shakti launched a mobile
• To improve the quality of farmers saved seed through
application for Geo-Tagging of the components of
use of different seed enhancement techniques.
projects under PMKSY.
• To ensure the disease & insect free quality seed
• Components:
production by use of suitable plant protection
o Accelerated Irrigation Benefit Programme
measures.
(AIBP): To focus on faster completion of ongoing
• To train the farmers about seed production
Major and Medium Irrigation including National
technology, use of quality seed along with improved
Projects.
package of practices for different seed crops.
o PMKSY (Har Khet ko Pani): Creation of new
water sources through Minor Irrigation (both
Monitoring of the Scheme:
surface and ground water)Repair, restoration
and renovation of water bodies; construction • The scheme will be monitored by the Seeds Division
rain water harvesting structures (Jal Sanchay); of the Department of Agriculture and Cooperation.
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OnlyIAS UDAAN PLUS: ECONOMY

• The implementing agencies will be required to send Organism (GEOs) or Living Modified Organism
quarterly progress. (LMOs) intended for direct use as food or for
processing.
Benefits offered: • The regulations will cover food products that may
• Seed is available at the doorsteps of farms at an have been made using food ingredients or processing
appropriate time. aid derived from GMO, even if GM content is not
• Seeds are available at affordable costs even lesser present in the end-product.
than the market price.
• It has increased the confidence among the farmers Major Provisions of Draft Regulations:
about the quality because of known sources of • No one can manufacture or sell any food products
production. or food ingredients derived from genetically
• It facilitates the fast spread of new cultivars of modified organisms (GMOs) without prior approval.
different kinds. • Specifies norms that labs will need to adhere for
testing GM foods.
PM-KISAN • The proposed regulations will apply to
“Genetically Modified Organisms (GMOs) or
• In News: Recently, the Prime Minister released the Genetically Engineered Organisms (GEOs) or Living
9th instalment of financial benefit under Pradhan Modified Organism (LMOs) intended for direct use as
Mantri Kisan Samman Nidhi (PM-KISAN). food or for processing.”
• The regulations’ ambit will include food products
About PM-Kisan scheme:
that may have been made using food ingredients or
• It is a central sector scheme with 100 per cent processing aid derived from GMOs, even if GM
funding from the Government of India. The content is not present in the end-product.
scheme was launched in December 2018.
• Genetically Modified Organisms or Genetically
• Under the scheme, income support of ₹6,000 per Engineered Organisms “shall not be used as an
year in three equal installments of ₹2000 is ingredient” in infant food products.
provided to small and marginal farmers having a
• The draft also proposes labeling norms for food
combined land holding of up to two hectares.
products that contain one per cent or more than one
• The state governments and UT administration percent of GMO content.
identify the farmers who are eligible for the scheme
and share the list with the Centre. FSSAI guidelines on GM Food:
• Ambit: The Scheme initially provided income • FSSAI issued an order on February 8, 2021, setting
support to all Small and Marginal Farmers’ families the permissible limit for genetically modified
across the country, holding cultivable land upto 2 organisms (GMO) in imported food crops at 1%.
hectares. Its ambit was later expanded w.e.f.
• It amounts to advocacy for zero presence of GMOs in
01.06.2019 to cover all farmer families in the country
food and some other consumables.
irrespective of the size of their land holdings.
• Exceptions: Affluent farmers have been excluded Genetically Modified Organism (Transgenic
from the scheme such as Income Tax payers in last Organism):
assessment year, professionals like Doctors,
• In GMO, genetic material (DNA) is altered or
Engineers, Lawyers, Chartered Accountants etc and
artificially introduced using genetic engineering
pensioners drawing at least Rs.10,000/- per month
techniques.
(excluding MTS/Class IV/Group D employees).
• Genetic modification involves the mutation,
insertion, or deletion of genes.
Similar programmes by states:
• Inserted genes usually come from a different
• Bhavantar Bhugtan Yojana- MP.
organism (e.g. In Bt cotton, Bt genes from bacterium
• The Rythu Bandhu scheme- Telangana.
Bacillus thuringiensis are induced).
• Krushak Assistance for Livelihood and Income
• Genetic modification is done to induce a desirable
augmentation (KALIA)- Odisha.
new trait which does not occur naturally in the
species.
DRAFT RULES FOR GM FOODS
• In News: Recently, social activists working among GM techniques:
farmers have come out against the Food Safety and 1. Biological and medical research,
Standards Authority of India’s (FSSAI) draft 2. Production of pharmaceutical drugs,
regulations on genetically modified (GM) food, 3. Experimental medicine (e.g. gene therapy),
terming it “unacceptable”. 4. Agriculture (e.g. golden rice, Bt cotton etc.),
5. Genetically modified bacteria to produce the protein
Background: insulin,
• FSSAI has released draft regulations for GM foods. 6. To produce biofuels from some GM bacteria, etc.
• The rules will apply to Genetically Modified
Organisms (GMOs) or Genetically Engineered GM crop allowed in India:

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OnlyIAS UDAAN PLUS: ECONOMY

• Bt cotton, the only GM crop that is allowed in • Cultivation area under bioenergy crops occupies
India, has two alien genes from the soil bacterium 3.8% ± 0.5% of the global total land area.
Bacillus thuringiensis (Bt) that allows the crop to • But they exert strong regional biophysical effects,
develop a protein toxic to the common pest pink leading to a global net change in air temperature of
bollworm. −0.08 ~ +0.05 degrees Celsius.
• On the other hand, Bt cotton is derived with the • Biophysical cooling or warming effects of these crops
insertion of an additional gene, from another soil can strengthen or weaken the effectiveness of
bacterium, which allows the plant to resist the bioenergy crop cultivation with carbon capture and
common herbicide glyphosate. storage (BECCS) in limiting the temperature
increments.
Genetic Engineering Appraisal Committee: • This depends on the cultivation map and the
• It functions under the Ministry of Environment, bioenergy crop type.
Forest and Climate Change (MoEF&CC). • Compared to the herbaceous crops, changes in the
• It is responsible for the appraisal of activities energy fluxes induced by woody crops in the
involving large-scale use of hazardous cultivation regions are larger, and the cooling effect is
microorganisms and recombinants in research and stronger and healthier across different cultivation
industrial production from the environmental angle. maps.
• The committee is also responsible for the appraisal MOBILE HONEY PROCESSING VAN
of proposals relating to the release of genetically
• In News: Recently, KVIC launched the country’s first
engineered (GE) organisms and products into the
Mobile Honey Processing Van at Village Sirora in
environment including experimental field trials.
Ghaziabad, UP.
• GEAC is chaired by the Special
Secretary/Additional Secretary of MoEF&CC and
About Mobile Honey Processing Van:
co-chaired by a representative from the Department
• Designed by: The Mobile Van has been designed in-
of Biotechnology (DBT).
house by KVIC at its Multi-disciplinary Training
Centre, Panjokehra.
BIOENERGY CROPS • Features:
• In News: Recently, a new study found that converting • This mobile honey processing unit can process up to
annual crops to perennial bioenergy crops can induce 300Kg of honey in 8 hours.
a cooling effect on the areas where they are • The van is also equipped with a testing laboratory,
cultivated. that would instantly examine the quality of honey.
• Aims: at training beekeepers, distributing Bee Boxes
Bioenergy Crops: to farmers and helping rural, educated as well as
• Bioenergy is the energy derived from recently living unemployed youth to earn extra income through
material such as wood, crops, or animal waste. beekeeping activities.
• Bioenergy crops are defined as any plant material • Objective: In line with Prime Minister’s dream of
used to produce bioenergy. “Sweet Kranti” (Sweet Revolution) though honey
• These crops have the capacity to produce large production, the KVIC has come up with this unique
volumes of biomass, high energy potential and can be innovation to enable beekeepers and farmers to get
grown in marginal soils. fair price of their honey produce.
• Examples of bioenergy crops: Eucalyptus, poplar,
willow, miscanthus and switchgrass. Sweet Revolution:
• It is an ambitious initiative of the Government of
Classification of Bioenergy crops: India for promoting apiculture, popularly known as
• First-generation bioenergy crops: Corn, sorghum, 'beekeeping'.
rapeseed and sugarcane • To provide a booster shot to Sweet Revolution, the
• Second-generation bioenergy crops: Switchgrass, government launched the National Beekeeping and
miscanthus, alfalfa, reed canary grass, Napier grass Honey Mission in 2020 (under the Ministry of
and other plants. Agriculture and Farmers Welfare).
• Third-generation bioenergy crops: Boreal plants, • It aims to accelerate the production of quality honey
crassulacean acid metabolism (CAM) plants, and other related products.
eucalyptus and microalgae.
• Bioenergy halophytes: Genera Acacia, Eucalyptus, Objective:
Casuarina, Melaleuca, Prosopis, Rhizophora and • Providing employment by connecting the farmers of
Tamarix. the state with bee keeping.
• Dedicated energy crops: Perennial herbaceous and • To increase agriculture and horticulture yield and
woody plant species as giant miscanthus, income of farmers.
switchgrass, jatropha and algae. • To make the state the leading state in the field of
honey production.
Findings: • Children free from malnutrition.
• Production of quality honey.
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OnlyIAS UDAAN PLUS: ECONOMY

Other Honey Initiatives: provided for the purchase of drones. But this grant
• Honey FPO Programme: The Honey FPO will be limited to only Farm Machinery Training and
Programme has been launched under the Central Testing Institutes, Indian Council of Agricultural
Sector Scheme for Formation & Promotion of new Research (ICAR) institutes, Krishi Vigyan Kendras
10,000 FPOs. and State Agriculture Universities.
• Honey Mission Programme: The Honey Mission • Farmers Producers Organizations (FPOs) would
Programme was launched by Khadi & Village be eligible to receive grants up to 75% of the cost of
Industries Commission (KVIC), under the Ministry of agriculture drone for its demonstrations on the
MSME, during 2017-18. farmers’ fields.
• National Beekeeping & Honey Mission (NBHM): • A contingency expenditure of Rs.6000 per hectare
Scientific beekeeping is promoted for holistic growth would be provided to implementing agencies that
of the sector, leading to income and employment do not want to purchase drones but will hire drones
generation, livelihood support to farm and non-farm for demonstrations from Custom Hiring Centers, Hi-
households. tech Hubs, Drone Manufacturers and Start-Ups.
• Scheme of Fund for Regeneration of Traditional However, they would receive only Rs 3,000/hectare
Industries’ (SFURTI): implemented by the Ministry if they are purchasing the drones for demonstrations.
of MSME, traditional beekeepers are provided with • Agriculture graduates establishing Custom Hiring
sustainable employment by organizing them into Centers (CHCs) will be eligible to receive 50% of
clusters, and supporting them with new machineries the basic cost of a drone and its attachments or up to
and training. ₹5 lakh in grant for drone purchases.
• Existing Custom Hiring Centers which are set up by
Khadi and Village Industries Commission (KVIC): Cooperative Society of Farmers, FPOs and Rural
• KVIC is a statutory body established under the entrepreneurs are entitled to receive 40% (maximum
Khadi and Village Industries Commission Act, ₹4 lakh) as a grant on the basic cost of the drone.
1956. • The financial assistance is to be made available by
• The KVIC is charged with the planning, promotion, the end of March 2023.
organisation and implementation of programmes for
the development of Khadi and other village industries PURPLE REVOLUTION
in the rural areas in coordination with other agencies
• In News: Recently, the Aroma Mission, also popularly
engaged in rural development wherever necessary.
referred as “Lavender or Purple Revolution”, has
• It functions under the Ministry of Micro, Small and
started from J&K and transformed the lives of
Medium Enterprises.
farmers who are able to grow lavender, make
lucrative profit and improve their lives.
PROMOTION OF DRONE USE IN AGRICULTURE
• In News: Recently, the Ministry of Agriculture and About Purple Revolution (Under Aroma Mission):
Farmers Welfare has issued revised guidelines of the • First-time farmers were given free lavender saplings
“Sub-Mission on Agricultural Mechanization” and those who have cultivated lavender before were
(SMAM) scheme in a move aimed at making drones charged Rs. 5-6 per sapling.
more accessible to the farmers. • Objectives:
o To promote the cultivation of aromatic crops for
About the Promotion: essential oils.
• The drone operations are being permitted: by the o To enable Indian farmers and the aroma industry
Ministry of Civil Aviation and Director General of Civil to become global leaders.
Aviation through the conditional exemption route. o To provide benefits to the farmers in achieving
• Drone Rules 2021: Ministry of Civil Aviation has higher profits, utilization of waste lands and
published ‘Drone Rules 2021’ to regulate the use and protection of their crops from wild and grazing
operation of Drones in India. animals.
• The Department of Agriculture & Farmers o Provided employment to women farmers
Welfare has also brought out Standard Operating • Nodal Agencies: CSIR-Central Institute of Medicinal
Procedures (SOPs): for use of Drone application and Aromatic Plants (CSIR-CIMAP), Lucknow.
with pesticides for crop protection in agricultural, • Coverage: The project assured benefits to the
forestry, non-cropped areas, etc. and for Drone growers of Vidarbha, Bundelkhand, Gujarat,
Application in Spraying for Soil and Crop Nutrients. Marathwada, Rajasthan, Andhra Pradesh, Odisha and
• Comply with these rules: The demonstrating other states where farmers are exposed to frequent
institutions and all the providers of agricultural episodes of weather extremes and account for
services through drone application have to comply maximum suicides.
with these regulations and SOPs. • Aromatic Plants:
o Lavender
Guidelines: o Damask rose
• A grant of up to 100% of the cost of an agriculture o Mushk bala, etc.
drone or ₹10 lakhs whichever is less will be • Products:
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OnlyIAS UDAAN PLUS: ECONOMY

o Lavender oil which sells for at least Rs. 10,000

per litre 2. INDUSTRY AND
o Lavender water, which separates from lavender INFRASTRUCTURE
oil, is used to make incense sticks.
o Hydrosol, which is formed after distillation from
NEW INDUSTRIAL DEVELOPMENT SCHEME FOR
the flowers, is used to make soaps and room
JAMMU & KASHMIR
fresheners.
• In News: Recently, GoI has formulated New
Industrial Development Scheme for Jammu &
Kashmir (J&K IDS, 2021) for the development of
Industries in the UT of Jammu & Kashmir.

About the scheme:

• It is a Central Sector Scheme.
• Aims: to take industrial development
(Manufacturing as well as Service Sector Units) to the
block level in UT of J&K, which is first time in any
Industrial Incentive Scheme of the Government of
India.
• Objective: to generate employment which directly
leads to the socio economic development of the
region.

Key Features of the Scheme:

• Attractive for both smaller and larger units.
• It attempts for a more sustained and balanced
industrial growth in the entire UT.
• Simplified on the lines of ease of doing business by
bringing one major incentive- GST Linked Incentive-
that will ensure less compliance burden without
compromising on transparency.
• It is not a reimbursement or refund of GST but gross
GST is used to measure eligibility for industrial
incentive to offset the disadvantages that the UT of
J&K face.

Incentives Under the Scheme:

• Capital Investment Incentive: At the rate of 30% in
Zone-A and 50% in Zone-B on investment made in
plant and machinery (in manufacturing), or
construction of building and other durable physical
assets (in service sector).
• Capital Interest subvention: It provides for 6%
capital interest subvention for a maximum of seven
years on loans up to Rs. 500 crore for investment in
plant and machinery (in manufacturing), or
construction in building and all other durable
physical assets (in service sector) for 10 years.
• GST Linked Incentive: This will incentivise output
up to 300% of the eligible value of actual investment
made in the plant and machinery (in manufacturing),
or construction in building and all other durable
physical assets (in service sector).
• Working Capital Interest Incentive: All existing
units at the annual rate of 5% for maximum 5 years.
Maximum limit of incentive is Rs 1 crore.

Central Sector Schemes

• These schemes are 100% funded by the Central
government.
• Implemented by the Central Government
machinery.
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OnlyIAS UDAAN PLUS: ECONOMY

• Formulated on subjects mainly from the Union List. signed an agreement with an Argentinian firm to
jointly prospect lithium in Argentina.
LITHIUM REFINERY
• In News: Recently, it has been announced that India’s GLOBAL HOUSING TECHNOLOGY CHALLENGE
first Lithium refinery which will process Lithium ore • In News: Recently, Prime Minister has laid the
to produce battery-grade material will be set up in foundation of Light House Projects (LHPs), as part of
Gujarat. the Global Housing Technology Challenge-India
(GHTC-India) initiative, at six sites across six states
About: via video conference.
• Manikaran Power Limited, one of the country’s
largest power trading and renewable energy Light house projects:
companies will be investing over Rs 1,000 crore to set • Constructed at: Indore (Madhya Pradesh), Rajkot
up this refinery. (Gujarat), Chennai (Tamil Nadu), Ranchi (Jharkhand),
• The company will be importing Lithium ore from Agartala (Tripura) and Lucknow (Uttar Pradesh).
Australia and will be processing it here. • Comprise about 1000 houses at each location along
• Last year, Manikaran Power had collaborated with with allied infrastructure facilities.
Australian firm Neometals to tap the Mount Marion • Projects will showcase the use of the six distinct
Lithium mine in Western Australia. shortlisted innovative technologies for field level
• They are currently exploring a couple of places in application, learning and replication.
Sanand and Dholera to set up this refinery. • Demonstrate and deliver ready to live houses at
• The proposed project is expected to help Gujarat an expedited pace within twelve months, as
secure the raw material supply for domestic compared to conventional brick and mortar
manufacturing of Lithium batteries as it looks to construction, and will be more economical,
promote electric vehicles. sustainable, of high quality and durability.
• LHPs demonstrate a variety of technologies,
Lithium: including Prefabricated Sandwich Panel System in
• It is a chemical element with the symbol Li. LHP at Indore, Monolithic Concrete Construction
• It is a soft, silvery-white metal. using Tunnel Formwork etc.
• Under standard conditions, it is the lightest metal and • LHPs will serve as live laboratories for facilitating
the lightest solid element. transfer of technology to the field and its further
• It is highly reactive and flammable, and must be replication.
stored in mineral oil.
• It is an alkali metal and a rare metal. Global Housing Technology Challenge-India:
• Top Lithium producing countries: Australia, Chile, • Launched by: Ministry of Housing & Urban Affairs.
China, Argentina, Zimbabwe and Portugal. • Purpose: GHTC envisages to provide an ecosystem
• Uses: for adoption of innovative technologies in the
o Lithium metal is used to make useful alloys. housing construction sector in a holistic manner.
E.g.: with lead to make ‘white metal’ bearings for • Components of GHTC-India include:
motor engines, with aluminium to make aircraft o Construction Technology India Biennial Expo-
parts, and with magnesium to make armour cum-Conference
plates. o Identifying and Mainstreaming Proven
o In thermonuclear reactions. Demonstrable Technologies for Construction of
o To make electrochemical cells. Lithium is an Light House Projects
important component in Electric Vehicles, o Identifying Potential Future Technologies for
Laptops. Incubation and Acceleration Support through
Affordable Sustainable Housing Accelerators -
Lithium in India: India (ASHA - India).
• Atomic Minerals Directorate for Exploration and
Research (AMD) have shown the presence of lithium Affordable Sustainable Housing Accelerators – India
resources in Mandya district, Karnataka. (ASHA-India):
• Other Potential Sites in India: • Aims: to promote domestic research and
o The major mica belts in Rajasthan, Bihar, and entrepreneurship by providing incubation and
Andhra Pradesh. acceleration support to potential future technologies.
o Pegmatite (igneous rocks) belts in Odisha and • ASHA-India initiative: five ASHA-India Centers have
Chhattisgarh. been set up for providing incubation and acceleration
o Brines of Sambhar and Pachpadra in Rajasthan, support.
and Rann of Kachchh in Gujarat. • The technologies, processes and materials
• Benefits of Domestic Exploration: Reducing Import identified through this initiative will provide a major
Bill and Reducing Overdependence on China fillip to young creative minds, start-ups, innovators
• Government Initiative: India, through a newly and entrepreneurs.
state-owned company Khanij Bidesh India Ltd, had
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OnlyIAS UDAAN PLUS: ECONOMY

PMAY-U Mission: with new regions, enhanced multi-modal

• Pradhan Mantri Awas Yojana – Urban (PMAY-U) connectivity including rail, inland water, coastal and
Mission has been designed to achieve the vision of road services.
“Housing For All by 2022”.
• In order to recognize the outstanding contribution by GOLDEN QUADRILATERAL & GOLDEN DIAGONAL
States, UTs, Urban Local Bodies and beneficiaries, the SECTIONS
Ministry of Housing and Urban Affairs has introduced
• In News: Recently, Indian Railways enhanced the
annual awards for excellence in implementation of
maximum speed to 130 kmph for 1,280 km length out
PMAY-Urban.
of 1,612 Km in Golden Quadrilateral – Golden
Diagonal (GQ-GD) route.
SAGARMALA SEAPLANE SERVICES (SSPS)
• In News: Recently, the Ministry of Ports, Shipping South Central Railway zone:
and Waterways is starting the ambitious Project of • The route covers the entire GQ-GD route over the
Sagarmala Seaplane Services (SSPS) with potential South Central Railway zone, except the Vijayawada -
airline operators. Duvvada section, where a signaling up-gradation task
is in progress.
Seaplane: • According to the approved plan of increasing the
• A seaplane is a fixed-winged aeroplane designed for speed of trains to 130 km per hour, the South Central
taking off and landing on water. It offers the public Railway zone will boost the maximum speed limits
the speed of an aeroplane with the utility of a boat. along the following routes:
• It will connect Sabarmati River in Ahmedabad to the • Golden Diagonal (Grand Trunk) Route - 744 route
Statue of Unity in Kevadia in Narmada district. km:
• Objective: To boost the tourism sector; Employment o Ballarshah to Kazipet - 234 route km
generation for the local people. o Kazipet-Vijayawada-Gudur - 510 route km
• Golden Quadrilateral Route (Chennai-Mumbai
India’s Sea Plane Project: section) - 536 route km:
• The Airports Authority of India (AAI) requested o Renigunta to Gooty - 281 route km
state governments of Gujarat, Assam, Andhra o Gooty to Wadi- 255 route km
Pradesh and Telangana and the administration of • The maximum speed limits in the High-Density
Andaman & Nicobar to propose potential locations Network (HDN) between Secunderabad – Kazipet
for setting up water aerodromes. (132 Km distance) had already been increased to 130
• The routes awarded for seaplane operations include kph.
Sabarmati riverfront to Statue of Unity and • A total of 2,824 km of the track has been made fit to
Shatrunjay Dam; Guwahati riverfront to Umrango run at a speed of 130 kph.
reservoir, Jorhat and Shillong (Meghalaya) and
Nagarjuna Sagar to Vijayawada and Hyderabad Golden Quadrilateral Project:
(Telangana). • Highway network which links Delhi, Mumbai, Kolkata
• Agatti, Kavaratti and Minicoy islands of Lakshadweep and Chennai thus connecting the major industrial,
have also been proposed to be connected through the agricultural and cultural centres of India
seaplane project under the fourth round of UDAN • Project was started in 2001 by Atal Bihari Vajpayee
scheme. under the NDA government and was completed in
January 2012.
Countries Operate Sea Plane: • It was the Phase-1 of the bigger National Highway
• Seaplanes are operational in countries like the Development Project that was launched in 1998 by
Philippines, Canada, Australia, the United States, the same government.
Finland, the United Kingdom, Sri Lanka, Fiji, New • Managed by the National Highways Authority of
Zealand, Papua New Guinea, United Arab Emirates, India (NHAI) under the Ministry of Road, Transport
Italy, Maldives and Hongkong. and Highways.

Sagarmala Programme: Benefits:

• The Sagarmala Programme was approved by the • Better movement of products and people
Union Cabinet in 2015 which aims at holistic port • More choice of locations for initiating industrial
infrastructure development along the 7,516-km long activity
coastline through modernisation, mechanisation and • Reduced wastage for the agriculture sector
computerisation. • A decrease in vehicle operating costs and time
• Under this port-led development framework, the
government hopes to increase its cargo traffic three- FREIGHT BUSINESS DEVELOPMENT PORTAL
fold.
• It also includes the establishment of rail/road • In News: Recently the Ministry of Railways has
linkages with the port terminals, thus providing last- launched Freight Business Development Portal.
mile connectivity to ports; development of linkages
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OnlyIAS UDAAN PLUS: ECONOMY

About Freight Business Development Portal: • Atma Nirbhar Bharat: Digital India Atma Nirbhar
• It is an exclusive portal to promote and develop Bharat App Innovation Challenge.
the railways freight business. • Make in India: Promotion to indigenously made
• Ensures that all operations stay customer centric, goods and services under the initiative.
reduce the costs for logistics providers, provide • Start-Up India Programme: A flagship initiative,
online tracking facilities for suppliers and also intended to build a strong eco-system for nurturing
simplify the process of goods transportation. innovation and start-ups in the country to drive
• Aims: to replace physical processes with online ones sustainable economic growth and generate large
to minimize the need of human to human interaction. scale employment opportunities.
• Focus will be on ease of doing business and to bring • Start-up India Digital Platform: It is the world’s
more transparency and to provide professional largest virtual incubator with over 300,000
support. registered start-ups and aspiring entrepreneurs.
• Start-up Grand Challenge: It channelizes the
PRARAMBH – STARTUP INDIA INTERNATIONAL entrepreneurial capacity between Indian and Korean
SUMMIT start-ups to work together and build solutions for the
challenges facing the world.
• In News: Recently, Prarambh- The Startup India
• Atal Innovation Mission (AIM): Launched by NITI
International Summit has been organised by the
Aayog as a flagship programme, it aims to promote a
Department for Promotion of Industry and Internal
culture of innovation and entrepreneurship in India.
Trade, Ministry of Commerce and Industry.
• Project Chunauti: It is a start-up challenge under the
Prarambh: Startup India International Summit: Next Generation Incubation Scheme (NGIS) initiative.
Selected startups are provided human resources,
• The summit has been organized by the Department
legal, intellectual property rights (IPR) and Patent
for Promotion of Industry and Internal Trade,
matters guidance as well as other incubation and
Ministry of Commerce and Industry.
mentorship facilities.
• The summit is organized as a follow-up to the
• National Initiative for Developing and Harnessing
announcement made by the Indian Prime Minister at
Innovations (NIDHI): It is an umbrella programme
the 4th BIMSTEC Summit held in Nepal in 2018.
for nurturing ideas and innovations (knowledge-
During the occasion, India committed to host the
based and technology-driven) into successful
BIMSTEC Startup Conclave.
startups.
• Focus of the Summit: Enhancing multilateral
cooperation and engagement with countries from
Department for Promotion of Industry and Internal
around the globe to collectively develop and
Trade
strengthen the startup ecosystems.
• Earlier called Department of Industrial Policy &
Promotion and was renamed as DPIIT in January,
India and Start-ups:
2019.
• A startup is an entity, incorporated or registered in
• Ministry: Ministry of Commerce and Industry.
India for less than 7 years.
• In 2018, matters related to e-commerce were
• Its annual turnover should be less than 25 crores in
transferred to the Department and in 2019, the
any preceding financial year.
Department was given charge for matters related to
• It should be working towards innovation,
Internal Trade, welfare of traders and their
development, deployment or commercialization of
employees and Startups.
new products, processes or services driven by
• Role: To promote/accelerate industrial development
technology or intellectual property.
of the country by facilitating investment in new and
• India today has the world’s third-largest startup
upcoming technology, foreign direct investment and
ecosystem.
support balanced development of industries.
• The country has more than 42,000 startups of which
• Major engagements of DPIIT:
more than 5,700 startups are in the IT sector.
o Business Reform Action Plan (BRAP) ranking of
• As many as 3,600 startups operate in the health
states,
sector, while nearly 1,700 startups are present in the
o Industrial Corridors,
agriculture sector
o Invest India,
• The registered startups have collectively raised $63 o Make in India initiative, etc.
billion across over 5,400 funding deals.
• There are 12 jobs created per startup in India,
according to the Startup India programme. STARTUP INDIA SEED FUND SCHEME (SISFS)
• Currently, 44 per cent of DPIIT-recognised startups • In News: Recently, the Government has launched the
have at least one women director. Startup India Seed Fund Scheme (SISFS).
• So far: 296 startups have received tax benefits under
the Startup India programme while 39 regulations About Startup India Seed Fund:
including Angel Tax have been simplified • Aim: To provide financial assistance to startups for
proof of concept, prototype development, product
Major Government Initiatives: trials, market entry, and commercialization.
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OnlyIAS UDAAN PLUS: ECONOMY

• Launched by: Department for Promotion of Industry o Funding & Incentives: Exemptions on Income
and Internal Trade (DPIIT) with an outlay of Rs. 945 Tax and Capital Gains Tax for eligible startups; a
Crore. fund of funds to infuse more capital into the
• Eligibility Conditions: startup ecosystem and a credit guarantee
o A startup, recognized by DPIIT, incorporated not scheme.
more than 2 years ago at the time of application. o Incubation & Industry-Academia
o Startups should not have received more than Rs. Partnerships: Creation of numerous incubators
10 lakh of monetary support under any other and innovation labs, events, competitions and
Central or State Government scheme. grants.
• Features:
o Support an estimated 3,600 entrepreneurs NATIONAL STAR TUP ADVISORY COUNCIL
through 300 incubators in the next 4 years.
• In News: Recently, the Minister of Commerce &
o An Experts Advisory Committee (EAC), Industry chaired the first meeting of the National
constituted by DPIIT, will be responsible for the Startup Advisory Council (NSAC).
overall execution and monitoring.
o Grants of upto Rs. 5 crore will be provided to About National Startup Advisory Council (NSAC):
the eligible incubators selected by the
• NSAC was constituted by the Department for
committee.
Promotion of Industry and Internal Trade
o The selected incubators will provide grants of
(DPIIT).
up to Rs. 20 lakh for validation of proof of
• Objective: To advise the Government on measures
concept, or prototype development, or product
required to build a strong ecosystem for nurturing
trials to startups.
innovation and startups in the country.
o Investments of up to Rs. 50 lakh will be
• Structure of NSAC:
provided to the startups for market entry,
o The National Startup Advisory Council will be
commercialization, or scaling up through
chaired by the Minster for Commerce & Industry.
convertible debentures or debt-linked
o The Council will consist of the non-official
instruments.
members, to be nominated by the Central
Government.
Seed Funding:
o The nominees of the concerned
• It typically represents the first official money that a
Ministries/Departments/Organisations, not
business venture or enterprise raises.
below the rank of Joint Secretary to the
• It helps a company to finance its first steps, including
Government of India, will be ex-officio members
things like market research and product
of the Council.
development.
• Functions of NSAC:
• There are many potential investors in a seed funding
o Suggest measures to foster a culture of
situation: founders, friends, family, incubators,
innovation amongst citizens and students.
venture capital companies and more.
o Promote innovation in all sectors of economy
• One of the most common types of investors across the country, including semi-urban and
participating in seed funding is a so-called "angel rural areas.
investor." o Support creative and innovative ideas through
incubation and research and development to
Angel investors: high net worth individuals who invest transform them into valuable products.
their personal income in business start-ups or small and
medium scale companies.
IRON ORE POLICY 2021
Startup India Initiative: • In News: The Ministry of Railways has approved a
• Launched in 2016 new iron-ore policy governing the allocation of rakes
• Objective: To support entrepreneurs, building a and transportation of iron-ore.
robust startup ecosystem and transforming India into
a country of job creators instead of job seekers. About Iron Ore Policy 2021:
• Managed by: The programs under the initiative are • The provisions of the new policy will be updated in
managed by a dedicated Startup India Team which the rake allotment system module by the Centre for
reports to the Department for Industrial Policy and Railway Information Systems (CRIS).
Promotion (DPIIT). • The scrutiny of documentation by Railways has been
• Key Pillars: removed.
o Simplification and Handholding: Easier • Executive Director Rake Movement of Railway Board
compliance, easier exit process for failed (EDRM) office, Kolkata which has been sanctioning
startups, legal support, fast-tracking of patent programmes for movement of iron-ore traffic will
applications and a website to reduce information have no regulatory role in the new policy.
asymmetry. • Customers desirous of moving their traffic under any
priority will have to give an undertaking that they
have procured, transported and utilized materials as
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OnlyIAS UDAAN PLUS: ECONOMY

per rules and regulations of Central and State seizure, retention, or confiscation of the property of
Governments. the corporate debtor as a result of such Proceedings.
• For lapses, customers will be liable to be taken up as • It provides immunity to the corporate debtor and its
per the law of land and railway will stand indemnified property when there is the approval of the resolution
for any such lapses. plan resulting in the change of management of
• Higher priority will be given to the movement of iron- control of the corporate debtor.
ore traffic for domestic manufacturing activity. • This is subject to the successful resolution applicant
• The priority preferences for the customers will be being not involved in the commission of the offense.
self-generated by the system based on the customer’s
profile fed in the system by the concerning zone. INSOLVENCY AND BANKRUPTCY CODE
• Old and new plants will be treated similarly as far as (AMENDMENT) BILL 2021
allotment and loading of rakes is concerned.
• In News: Recently, President Ramnath Kovind has
given his assent to the Insolvency and Bankruptcy
Iron ore is the second most important stream of traffic of
Code (amendment) Bill 2021, which was passed by
Railways and along with steel accounts for nearly 17% of
Parliament in the monsoon session.
total 1210 million tonne freight loading of Indian
Railways in 2019-2020.
About Insolvency and Bankruptcy Code
(Amendment) Bill 2021:
SECTION 32A OF IBC • The government brought the amendments to the
• In News: Recently, SC has upheld section 32A of code to support MSMEs which require support in
Insolvency and Bankruptcy Code (IBC). view of COVID 19 pandemic.
• The Insolvency and Bankruptcy Code (Amendment)
Background: Bill, 2021 amends the Insolvency and Bankruptcy
• Insolvency and Bankruptcy Code is a reform Code, 2016.
enacted in 2016. • It introduced an alternate insolvency resolution
• It amalgamates various laws relating to the process for Micro, Small and Medium Enterprises
insolvency resolution of business firms. (MSMEs) with defaults up to Rs 1 crore called the Pre-
• It lays down clear-cut and faster insolvency packaged Insolvency Resolution Process (PIRP).
proceedings to help creditors, such as banks, recover • In March 2021 a sub-committee of the Insolvency
dues and prevent bad loans, a key drag on the Law Committee (ILC) recommended a pre-pack
economy. framework within the basic structure of the
Insolvency and Bankruptcy Code (IBC), 2016.
• Insolvency: It is a situation where individuals or Pre-Packed Insolvency Resolution:
companies are unable to repay their outstanding • It is a mechanism wherein a resolution arrangement
debt. is agreed upon between the distressed corporate
• Bankruptcy: It is a situation whereby a court of debtor (CDs) and lender before approaching the
competent jurisdiction has declared a person or other NCLT (National Company Law Tribunal) for
entity insolvent, having passed appropriate orders to bankruptcy proceedings.
resolve it and protect the rights of the creditors. It is
a legal declaration of one’s inability to pay off debts. Difference b/w PRIP and CRIP:

Supreme Court’s Judgment: Parameter PRIP CRIP

• In its judgment, the apex court, while upholding the Control of Debtors remain in Company is
validity of Section 32 A of IBC, said. the firm control of their managed by the
• It was important for the IBC to attract bidders who during the distressed firm. resolution
would offer reasonable and fair value for the process professional
corporate debtor to ensure the timely completion of Deadlines To be completed To be completed
corporate insolvency resolution process (CIRP). within a period of within a period of
• Such bidders, however, must also be granted 120 days of the 270 days of the
protection from any misdeeds of the past since they commencement commencement
had nothing to do with it. date. date.
• Such protection, the court said, must also extend to Process of Distressed Resolution
the assets of a corporate debtor, which form a crucial resolution company enters through open
attraction for potential bidders and helps them in into direct bidding system.
assessing and placing a fair bid for the company, agreement b/w
which, in turn, will help banks clean up their books of secured creditors
bad loans. and the existing
owners or outside
Section 32A: investors.
• In cases involving property of a corporate debtor,
Section 32A covers any action involving attachment,
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OnlyIAS UDAAN PLUS: ECONOMY

MEGA INVESTMENT TEXTILES PARKS (PM • Aimed at promoting a competitive and staple
MITRA) SCHEME product from a specific area to push sales and
improve the standard of living of the local population.
• In News: Recently, the Union Cabinet approved the
Over time, it has been replicated in other Asian
setting up of seven Mega Integrated Textile Region
countries as well.
and Apparel (PM MITRA) Parks at an outlay of Rs.
• In India, Uttar Pradesh government was the first state
4,445 crore.
of India to launch the concept of One District One
Product in 2018.
About PM MITRA park:
• Significance: This initiative is seen as a
• PM MITRA park will be developed by a Special
transformational step towards realizing the true
Purpose Vehicle which will be owned by the Central
potential of a district. It will fuel economic growth
and State Government and in a Public Private
and generate employment and rural
Partnership (PPP) Mode.
entrepreneurship.
• The Master Developer will not only develop the
• Components of the Scheme:
Industrial Park but also maintain it during the
o Identify one product per district based on the
concession period.
potential and strength of a district and national
• Features:
priorities
o Each MITRA Park will have an incubation centre,
o Develop a cluster for that product in the district
common processing house and a common
which is capable of producing a world-class
effluent treatment plant and other textile related
product with quality, scalability, and a brand
facilities such as design centres and testing
o Provide market linkages
centres.
o Address bottlenecks for exporting these
o 7 mega textile parks will be launched in three
products
years as part of the scheme.
o Support local exporters/manufacturers to scale
o The parks will be set up over 1,000 acres of land
up manufacturing
with world-class infrastructure and plug-and-
o Find potential buyers outside India with the aim
play facilities.
of promoting exports
o It will be an addition to the Rs. 10,683-crore
o Promoting manufacturing & services industry in
Production Linked Incentive Scheme (PLI) for
the District
technical textiles and manmade fibre.
o Generate employment in the District
o These will have integrated facilities and quick
turnaround time for minimizing transportation
Main objectives of the One District One Product
losses.
Scheme of Uttar Pradesh:
o These are also targeted to have uninterrupted
• Preservation and development of local crafts / skills
water and power supply, common utilities and
and promotion of the art.
research and development labs.
• Increase in the incomes and local employment
• Aims:
(resulting in decline in migration for employment).
o To position India as a fully integrated, globally
competitive, manufacturing and exporting hub. • Improvement in product quality and skill
o To enable the textile industry to attract large development.
investments and boost employment generation. • Transforming the products in an artistic way
(through packaging, branding).
• Eligibility for Incentives:
o An additional Rs 300 crore will be provided as • To connect the production with tourism (Live demo
Competitiveness Incentive Support for the early and sales outlet – gifts and souvenir).
establishment of textiles manufacturing units in • To resolve the issues of economic difference and
each of these parks. regional imbalance.
o Investors who set up “anchor plants” that employ • To take the concept of ODOP to national and
at least 100 people will be eligible for incentives international level after successful implementation at
of upto Rs 10 crore every year for upto three State level.
years.
Steps taken in India:
• ODOP initiative is operationally merged with
ONE DISTRICT-ONE PRODUCT SCHEME
‘Districts as Export Hub’ initiative being implemented
• In News: Recently, the Uttar Pradesh government by DGFT, Department of Commerce, with Department
named actor Kangana Ranaut as the brand for Promotion of Industry and Internal Trade (DPIIT)
ambassador of its ambitious ‘one district-one as a major stakeholder.
product’ programme.
Financial Assistance under the ODOP Programme:
About One District One Product Scheme: • Common Facility Centre (CFC) Scheme: It would
• This scheme is basically a Japanese business provide financial assistance of up to 90 per cent of the
development concept, which gained prominence in project cost. It is provided by the state government.
1979.

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OnlyIAS UDAAN PLUS: ECONOMY

• Marketing Development Assistance Scheme: The 30-40% of the total coffee production in India. It
financial assistance would be provided to all is also nicknamed the ‘coffee cup’ of India.
participants of national and international exhibitions o In Chikkamagaluru, spices were earmarked,
and fairs. They can use it for displaying and selling while pineapples were chosen in Shivamogga
their products selected under ODOP programme. district.
• Finance Assistance Scheme (Margin Money o Other products included are Kalaburagi (red
Scheme): This scheme benefits with not whole but a gram), Mandya (jaggery), Vijayapura (lemon),
margin of the project cost. The applicants receive it in Haveri (mango), Gadag (Byadagi chillies), Bidar
the form of subsidy to set up the project. (ginger), Ballari (fig), Mysuru (bananas), and
• Skill Development Scheme: In this, all skilled Koppal (guava).
artisans would be trained through RPL (Recognition • Northeast Region:
of Prior Learning). They would be certified through o The exceptional carpet making industry, bamboo
various Sector Skill Councils, SSCs, whereas the wood vessels, cane-craft, jewellery.
unskilled artisans would be trained for 10 days and o The handloom industry which produces some of
provided with an advanced toolkit which will be free the best silk products in the country
of cost. o The agricultural products that range from the
world’s best turmeric to one of the hottest chilies
GIS One District One Product (ODOP) Digital Map of in the world
India:
• Initiative of the Ministry of Food Processing. PRADHAN MANTRI URJA GANGA PROJECT
• It will provides detailed information about ODOP • In News: Recently, GAIL (India) Ltd has put West
products to all states and facilitates the stakeholders. Bengal on the gas map of India after it completed
• The digital map also has indicators for tribal, SC, ST, laying a Rs 2,433-crore pipeline that will bring to the
and aspirational districts. state cooking fuel that is cheaper than LPG and CNG
• It will enable stakeholders to make concerted efforts that costs less than petrol and diesel, and fuel to
for its value chain development. produce urea for all its requirement.

ODOP in Various States: About Pradhan Mantri Urja Ganga Project:

• Under the initial phase of the ODOP programme, 106 • Urja Ganga gas pipeline project was inaugurated by
Products have been identified from 103 districts Prime Minister Narendra Modi in his constituency
across 27 States. Varanasi, Uttar Pradesh.
• Uttar Pradesh: • A pipeline of length 2540 km is under construction
o The ancient and nutritious ‘Kala namak’ rice of from the states of Uttar Pradesh to Odisha.
Siddharthanagar • A paper titled Subsidies for Whom in The Economic
o The rare technique of wheat-stalk craft, and Political Weekly (EPW), published in 2012,
handicraft in Bahraich shows that only 18 percent households consume LPG
o The famous chikankari and zari-zardozi work as cooking fuel and the rest use other ways of cooking
garments like wood, kerosene, dung cakes etc which is harmful
o Banana fibre of Kushinagar, to their health
o Banana of Kaushambi,
o Jaggery of Ayodhya, Objectives:
o Aamla of Pratapgarh, • To provide piped cooking gas to the households of
o Pulses of Balrampur and Gonda, Varanasi within next two years and to millions others
o Desi ghee of Auraiya, in neighbour states after one more year.
o Wooden toys of Chitrakoot • To create 25 industrial clusters in these states which
o Wooden artefacts of Saharanpur, Basti, Bijnor, can utilise the gas as fuel and generate employment
Rae Bareli in these areas.
o The horn and bone work that uses the remains of
dead animals rather than living ones, making it a Length wise distribution:
nature-friendly replacement for ivory.
• The state of UP gets the gas line of length 338 km.
o Sunahri Kand: To support the production of
Bihar state will get about 441 km long line.
horticultural items under the “One District One
• Jharkhand gets 500 KM long.
Product (ODOP)” scheme and provide better
• West Bengal will have the pipe line of length 542 km
nutrition to school children.
and Odisha gets benefited by 718 km pipeline.
• Rajasthan: Blue Pottery (Jaipur) and Markhana
Marbels (Nagaur)
Target:
• Maharashtra: Wine from the Nashik valley
• The project is committed to provide the household
• Karnataka:
members health safety by providing clean fuel with
o The hilly district in Malnad region of Karnataka is
the piped gas to the locals of Varanasi and later to
known for its coffee production and accounts for
Bihar, Jharkhand, West Bengal and Odisha.

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OnlyIAS UDAAN PLUS: ECONOMY

• The seven main station cities include Varanasi, Patna, • The portal was initially launched in two districts and
Bokaro, Jamshedpur, Kolkata, Ranchi, Bhubaneswar is now being launched as an all India portal.
and Cuttack as the major beneficiaries of the project. • Objective: To directly connect Shramiks with MSMEs
and facilitate their placement
OCCUPATIONAL SAFETY, HEALTH AND WORKING • It will facilitate creation of 10 lakh blue collar jobs.
CONDITIONS CODE • Features:
o High Technology Enabled: The portal with the
• In News: Recently, NITI Aayog has constituted a sub-
group to prepare a National Action Plan for Migrant demand and supply data uses algorithm and
Workers. Artificial Intelligence (AI) tools, for geo spatial
information on demand and availability of
About Occupational Safety, Health and Working Shramiks, and also provides analysis on skill
Conditions Code: training programmes of Shramiks.
o Automatic Updation: The data/information
• To safeguard the interest of the migrant workers, the
pertaining to the Shramiks and the industries
Government had enacted the Inter-state Migrant
(especially MSME) are being updated
Workmen (Regulation of Employment and
automatically through various WhatsApp and
Conditions of Service) Act, 1979.
other links.
• This Act has now been subsumed in the Occupational
Safety, Health and Working Conditions Code, 2020,
commonly known as OSH Code. MAJOR PORT AUTHORITIES BILL, 2020
• Aims to regulate the employment of workers, • In News: Recently, the Parliament has passed the
including those engaged by contractors, and their Major Port Authorities Bill, 2020 that sought to
working conditions across sectors. provide autonomy to India’s major ports and improve
• It is one of the four codes that are part of the Centre’s their efficiency and competitiveness.
labour reforms agenda.
• Provides: About Major Port Authorities Bill, 2020:
o Decent working conditions, grievances redressal • The Bill aims to replace the Major Port Trusts Act,
mechanisms, minimum wages, protection from 1963.
abuse and exploitation etc., • It seeks to provide for regulation, operation and
o Enhancement of the skills and social security to planning of Major Ports in India and to vest the
all categories of organised and unorganised administration, control and management of such
workers including Migrant workers. ports upon the Boards of Major Port Authorities.
o The relevant provisions of the Code are • This will empower the Major Ports to perform with
applicable to every establishment in which 10 or greater efficiency on account of full autonomy in
more inter-state migrant workers are employed decision making and by modernizing the institutional
or were employed on any day of the preceding 12 framework of Major Ports.
months. • The Bill will apply to the major ports of Chennai,
Cochin, Jawaharlal Nehru Port, Kandla, Kolkata,
The four labour codes: on Wages, Industrial Relations, Mumbai, New Mangalore, Mormugao, Paradip, V.O.
Social Security and Occupational Safety, and Health and Chidambaranar, and Visakhapatnam.
Working Conditions intend to provide workers with wage • Major ports together handled 699.04 million tonnes
security, social security, safety, health and grievance (MT) of cargo during 2018-19.
redress mechanisms. • Objective:
o Decentralization: Decentralizing decision
SAKSHAM (SHRAMIK SHAKTI MANCH) making and to infuse professionalism in
• In News: Recently, the Technology Information, governance of major ports.
Forecasting and Assessment Council (TIFAC) has o Trade and Commerce: To promote the
launched a new initiatives - SAKSHAM (Shramik expansion of port infrastructure and facilitate
Shakti Manch) Job Portal. trade and commerce.
o Decision Making: It imparts faster and
About SAKSHAM Portal: transparent decision making benefiting the
• It is a dynamic portal for jobs/mapping the skills of stakeholders and better project execution
Shramiks (workers) vis-a-vis requirements of Micro, capability.
Small and Medium Enterprises (MSMEs) and other o Reorienting Models: Reorienting the
industries all across the country. It is an all India governance model in central ports to landlord
Portal. port model in line with the successful global
• The portal will help eliminate labour contractors. practice.
• It shall help identification of skill proficiency level • Features:
and development of Skill Cards for Shramiks. o The Bill proposes to create a Board of Major Port
Authority, for each major port.
• The portal uses algorithm and Artificial Intelligence
o Tariff Authority for Major Ports (TAMP) has now
(AI) tools for availability of Shramiks.
been given powers to fix tariffs which will act as
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OnlyIAS UDAAN PLUS: ECONOMY

a reference tariff for purposes of bidding for PPP • Also known as the ‘Scheme for Capacity Building in
projects. Textile Sector (SCBTS)’.
o An Adjudicatory Board has been proposed to be • Implemented by the Ministry of Textiles.
created to carry out the residual function of the • It seeks to Provide demand driven, placement
erstwhile TAMP for Major Ports oriented National Skills Qualifications Framework
• Board of Major Port Authority: (NSQF) compliant skilling programmes.
o These Boards will replace the existing Port • Target: To train 10.00 lakh persons (9 lakhs in
Trusts under the 1963 Act, that are comprised of organised & 1 lakh in traditional sector) excluding
members appointed by the central government. Spinning & Weaving in the organized Sector.
• Composition of Board: • Key features:
o Chairperson and a Deputy Chairperson, to be o Training of Trainers (ToT).
appointed by the central government on the o Aadhar Enabled Biometric Attendance System
recommendation of a selection committee. (AEBAS).
o Further, it will include one member each from (i) o CCTV recording of training programme.
concerned State Government in which the Major o Dedicated call centre with helpline number.
Port is situated, (ii) Ministry of Railways, (iii) • Implementing Agencies:
Ministry of Defence, and (iv) Customs o Textile Industry
Department. o Institutions/Organization of the Ministry of
o The Board will also include two to four Textiles/State Governments having training
independent members, two members infrastructure and placement tie-ups with textile
representing the interests of the employees of industry
the Major Port Authority, and one member not o Reputed training institutions/ NGOs/ Societies/
below the rank of Director (nominated by the Trusts/ Organizations/ Companies /Start Ups /
Central Government). Entrepreneurs active in textile sector having
• Powers of the Board: placement tie-ups with textile industry
o The Bill allows the Board to use its property, • Other Schemes of the Textile Sector:
assets and funds as deemed fit for the o Scheme for Integrated Textile Park (SITP)
development of the major port. o Power-Tex India
o The Board can also make rules on: o Silk Samagra Scheme
> Declaring availability of port assets for port o Amended Technology Upgradation Fund Scheme
related activities and services, (ATUFS)
> Developing infrastructure facilities such as o National Handloom Day
setting up new ports, jetties, and o Jute ICARE
> Providing exemption or remission from o National Technical Textile Mission
payment of any charges on any goods or
vessels.
PUBLIC SECTOR ENTERPRISE POLICY
Landlord Model • In News: Recently, the Government of India has
• The publicly governed port authority acts as a released a new ‘Public Sector Enterprise Policy’.
regulatory body and as landlord while private
companies carry out port operations mainly cargo- About ‘Public Sector Enterprise Policy’:
handling activities. • The policy classifies public sector commercial
• The port authority maintains ownership of the port enterprises into the strategic and non-strategic
while the infrastructure is leased to private firms that sector:
provide and maintain their own superstructure and • Strategic Sector: There would be a maximum of four
install their own equipment to handle cargo. In public sector companies in strategic sectors. State-
return, the landlord port gets a share of the revenue owned firms in other segments would be privatized
from the private entity. eventually.
• The role of the landlord port authority would be to • The following 4 sectors are covered under
carry out all public sector services and operations strategic sectors:
such as the award of bids for cargo terminals and 1. Atomic energy, Space and Defence
dredging. 2. Transport and Telecommunications
3. Power, Petroleum, Coal, and other minerals
4. Banking, Insurance, and financial services
SAMARTH SCHEME
• Non- Strategic Sector: CPSEs of this sector shall be
• In News: Recently, the Ministry of Textiles is privatized or closed, if privatization is not possible.
implementing the Samarth-Scheme for Capacity • Exceptions:
Building in the Textiles Sector. o Public sector classes like major port trusts, the
Airport Authority of India, and undertakings in
About Samarth Scheme: security printing and minting.
• It was approved by Cabinet Committee on Economic
Affairs (CCEA) in 2017.

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OnlyIAS UDAAN PLUS: ECONOMY

o Public sector entities such as not-for-profit • It is a part of the National Electric Mobility Mission
companies or CPSEs providing support to Plan.
vulnerable groups. • Aim: To promote manufacturing of electric and
• Privatisation Process: hybrid vehicle technology
o NITI Aayog will recommend PSUs for retention in • Main thrust of FAME is to encourage electric vehicles
strategic sectors and that should be considered by providing subsidies.
for privatization, merger, or closure. • Vehicles in most segments – two wheelers, three
o The Core Group of Secretaries on Divestment wheelers, electric and hybrid cars and electric buses
(CGD) headed by the cabinet secretary will obtained the subsidy benefit of the scheme.
consider these recommendations. • FAME focuses on 4 areas:
o Final approval will be provided by the 1. Technology development,
Alternative Mechanism. This mechanism consists 2. Demand Creation,
of the Finance minister, Ministers for 3. Pilot Projects and
Administrative reforms, and the Minister for 4. Charging Infrastructure.
roads, transport, and highways.
FAME-India Scheme Phase – II:
GO ELECTRIC CAMPAIGN • Aim: To boost electric mobility and increase the
• In News: Recently, the central government has number of electric vehicles in commercial fleets.
launched the “Go Electric" Campaign to spread • Target:
awareness on the benefits of e-mobility and EV o The outlay of ₹10,000 crore has been made for
Charging Infrastructure as well as electric cooking in three years till 2022 for FAME 2 scheme.
India. o The government will offer the incentives for
electric buses, three-wheelers and four-wheelers
About the Go Electric Campaign: to be used for commercial purposes.
• It is a campaign of the Bureau of Energy Efficiency o Plug-in hybrid vehicles and those with a sizeable
(BEE) to promote and spread awareness on electric lithium-ion battery and electric motor will also
mobility. be included in the scheme and fiscal support
• Objective: offered depending on the size of the battery.
o To push the country towards 100% e-mobility
and clean and safe e-cooking. HYDROGEN FUEL
o To create awareness at PAN-India level and • In News: Recently, under ‘Mission Net Zero Carbon
reduce the import dependence of the country. Emission Railway’ by 2030, Indian Railways are set to
o To move ahead on the path of a low carbon run trains on hydrogen fuel-based technology. For
economy, thereby saving the country and the this, it is considering retrofitting of existing trains.
planet from the adverse impact of climate
change. Hydrogen Fuel:
• Implementation: • Hydrogen is the lightest and first element on the
o Bureau of Energy Efficiency (BEE), under the periodic table. Since the weight of hydrogen is less
aegis of the Ministry of Power has been than air, it rises in the atmosphere and is therefore
mandated to undertake an awareness drive for rarely found in its pure form, H2.
promoting public charging, e-mobility & its • At standard temperature and pressure, hydrogen is a
ecosystem. non-toxic, non-metallic, odourless, tasteless,
colourless, and highly combustible diatomic gas.
Electric Mobility: • It is the most abundant element in the universe.
• E-mobility moves away from existing carbon- The sun and other stars are composed largely of
emitting fossil fuels to using energy from electrical hydrogen.
power sources (e.g. the National Grid) through • Astronomers estimate that 90% of the atoms in the
external charging capability. universe are hydrogen atoms. Hydrogen is a
• Currently, India is using 94 million tonnes of oil and component of more compounds than any other
petroleum products for transportation only which is element.
expected to double by 2030. • Water is the most abundant compound of
• For fossil fuels, India currently has an import bill of hydrogen found on earth.
Rs. 8 lakh Crore. • Molecular hydrogen is not available on Earth in
• It encompasses the use of fully electric, conventional convenient natural reservoirs.
hybrid, plug-in hybrid as well as hydrogen-fuelled • Most hydrogen on Earth is bonded to oxygen in water
vehicles. and to carbon in live or dead and/or fossilized
• Government Initiatives: ‘Faster Adoption and biomass. It can be created by splitting water into
Manufacturing of (Hybrid &) Electric Vehicles in India hydrogen and oxygen.
(FAME-India)’ Scheme. • Hydrogen fuel is a zero-emission fuel burned with
oxygen. It can be used in fuel cells or internal
FAME India:
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OnlyIAS UDAAN PLUS: ECONOMY

combustion engines. It is also used as a fuel for o It will also enable the cities and towns to benefit
spacecraft propulsion. from holistic and diverse forms of support. Such
as satisfying the needs and local challenges of the
Type of Hydrogen: towns and cities.
• Grey Hydrogen:
o It constitutes India's bulk production and is India Urban Data Exchange (IUDX):
extracted from hydrocarbons (fossil fuels, • It has been developed in partnership between the
natural gas). Smart Cities Mission and the Indian Institute of
o It gives CO2 as by product. Science (IISc), Bengaluru.
• Blue Hydrogen: • It serves as a seamless interface for data providers
o It is also sourced from fossil fuels. and data users, including Urban Local Bodies (ULBs),
o However, emissions/ by-products (CO, CO2) are to share, request, and access datasets related to cities,
captured and stored. urban governance, and urban service delivery.
o Thus, it is better than grey hydrogen. • It is an open-source software platform which
• Green Hydrogen: facilitates the secure, authenticated, and managed
o It is generated from renewable energy sources exchange of data amongst various data platforms, 3rd
such as solar and wind. party authenticated and authorised applications, and
o The electricity splits water into hydrogen and other sources.
Oxygen.
o It gives water and water vapour as by-products. Smart Code Platform:
o Thus, it is the best and cleanest type • Smart Code is a platform that enables all ecosystem
stakeholders to contribute to a repository of open-
Storage of Hydrogen: source code for various solutions and applications for
• Hydrogen can be stored physically as either a gas or urban governance.
a liquid. • It is designed to address the challenges that ULBs face
• Storage of hydrogen as a gas typically requires high- in the development and deployment of digital
pressure tanks. applications to address urban challenges, by enabling
• Storage of hydrogen as a liquid requires cryogenic cities to take advantage of existing codes and
temperatures because the boiling point of hydrogen customising them to suit local needs, rather than
at one atmosphere pressure is −252.8°C. having to develop new solutions from scratch.
• Hydrogen can also be stored on the surfaces of solids
(by adsorption) or within solids (by absorption). Geospatial Management Information System (GMIS):
• GMIS is a web-based, spatially-enabled management
NATIONAL URBAN DIGITAL MISSION (NUDM) tool, providing one-stop access to information.
• GMIS integrates information from multiple sources
• In News: Recently, the Ministry of Housing and Urban
and features search options by topic and geographic
Affairs has launched the National Urban Digital
area.
Mission(NUDM) and several other initiatives for
transforming urban governance.
FIXED TERM EMPLOYMENT
About NUDM: • In News: Recently, the Ministry of Labour and
• Launched by: Ministry of Housing and Urban Affairs Employment (Ministry) has notified the draft of the
(MoHUA) in partnership with the Ministry of Model Standing Orders, 2020 for all manufacturing,
Electronics and Information Technology (MEITY). mining and services sector. The draft document has
• Aim: To build the shared digital infrastructure that explicitly mentioned Fixed Term Employment as one
will strengthen the capacity of the urban ecosystem of the classifications of a worker.
to solve complex problems.
• Approach: The digital infrastructure will be built About The Draft Order:
across three pillars of People, Process and platform. • The draft has inserted fixed-term employment as a
The infrastructure will provide holistic support to category of employment but has removed “casual
cities and towns. work" from the list.
• Target: The NUDM aims to institutionalise a citizen- • Six categories of workers: Permanent, Temporary,
centric and ecosystem-driven approach to urban Apprentices, Probationers, Badlis and Fixed Term
governance and service delivery. The NUDM will be Employment.
completed in 2022 cities by 2022. Further, it will be • Badli: a worker who is appointed against the post of
expanded across all cities and towns in India by 2024. a permanent worker or probationer who is
• Significance: temporarily absent.
o The digital infrastructure will help cities to • The draft order will be applicable to all
consolidate and cross-leverage the various manufacturing and mining establishments with 300
digital initiatives of the Ministry of Housing and or more workers.
Urban Affairs.

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OnlyIAS UDAAN PLUS: ECONOMY

• The order will be finalized and integrated with the o Unlike most countries, there is no cap on the
Industrial Relations Code Act 2020 after receiving number of times private firms can renew fixed-
feedback from experts, academics, and others. term contracts in India.

Background on Statutory status of Fixed Term INDIA TELECOM 2021

Employment:
• In News: Recently, Union Minister for
• Industrial Employment (Standing Order) Act
Communications inaugurated India Telecom 2021
1946: fixed-term employment was initially made
Event.
available only to apparel manufacturing sector in
2016 and then to Footwear manufacturing sector in
About India Telecom 2021:
2017 through amendments.
• Organised by: Telecom Equipment Export
• Industrial Employment (Standing Orders)
Promotion Council(TEPC) under Market Access
Central (Amendment) Rules, 2018: allowed all
Initiative Scheme (MAI) of the Department of
industries to hire workers on contract with a fixed
Commerce.
tenure. On those lines, the Union Ministry of Labour
• Support from: Department of Telecommunications
(in 2018) had urged all States to issue separate
& Ministry of External Affairs.
orders permitting fixed term employment (FTE)
• Purpose: It is an exclusive international business
across all industries.
expo. It aims to provide opportunities to the Indian
• Union Ministry of Labour (in 2018): had urged all
telecom stakeholders to meet qualified overseas
States to issue separate orders permitting fixedterm
buyers.
employment (FTE) across all industries
• Data/Facts: 40 Indian telecom companies and 200
foreign delegates from more than 45 countries are
Fixed Term Employment:
attending the event.
• It is a contract in which a company or an enterprise
hires an employee for a specific period of time.
Telecom Equipment and Services Export Promotion
• In most cases, it is for a year but can be renewed after
Council (TEPC)
the term expires depending on the requirement.
• Setup by: Ministry of Commerce & Industry and
• The Standing Order has provided following facets
Ministry of Communications
with regard to fixed term employment:
• Aim: To promote and develop Export of Telecom
• Fixed-term employment: It is the engagement of the
Equipment and Services.
worker on the basis of a written contract of
• Functions: The council undertakes several activities
employment with an employer for a fixed period, but
aimed at exports promotion such as:
subject to following condition:
o Commissioning of Studies to find potential
o His/her hours of work, wages, allowances and
markets
other benefits shall not be less than that of a
o Recommending to the Government for making
permanent worker doing the same work or work
necessary changes in various policies and
of similar nature.
procedures for promotion of Exports and
o He/she shall be entitled to all statutory
Services.
benefits available to a permanent worker
o Holding of National/International Seminars
proportionately according to the period of
o Facilitating the participation of exporters in
service rendered by him even if his period of
various overseas exhibitions
employment does not extend to the qualifying
o Dissemination of trade-related data to its
period of employment required in the statute.
members.
o He/she shall be available for gratuity, if he
renders service under the contract for a period of
Market Access Initiative (MAI) Scheme:
one year. (Gratuity refers to a sum of money paid
• Nodal Ministry: Department of Commerce, Ministry
to an employee at the end of a period of
of Commerce and Industry
employment.)
o For every completed year of service or part • Objective: It is an Export Promotion Scheme. The
thereof in excess of six months, the employer scheme aims to act as a catalyst to promote India’s
shall pay gratuity to the worker at the rate of 15 exports on a sustained basis.
days wages. • Product and Country Focus Approach: The scheme
o Salary payment will be more transparent and is formulated on the basis of the product and country
all remuneration will be paid within a maximum focus approach. It will evolve specific markets and
of seven days after completion of the wage period specific products through market studies/surveys.
of a worker.
o The wage rates should be displayed on an RATING MECHANISM FOR NATIONAL HIGHWAYS
electronic device or notice board and website • In News: Recently, the Ministry of Road Transport &
or human resources portal of the industrial Highways (MoRTH) released the first-ever rating
establishment in Hindi, English or the local mechanism for National Highways.
language in which majority of the workers are
conversant.
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OnlyIAS UDAAN PLUS: ECONOMY

About the rating mechanism for National Highways: o It has power to manage various activities like
• Implemented: National Highways Authority of India infrastructure facilities, communication,
(NHAI) under the Ministry of Road Transport & security, etc., at an ICP.
Highways (MoRTH). o It can regulate and control the movement of
• Objective: Minimum time with maximum safety in a vehicles, people and goods at the ICP with due
stress-free environment for the highway users. Apart regard to the law, security and protocol of the
from that, it will also improve the government’s Government of India.
accountability towards road users.
Other Facts:
Parameters: • The LPAI has developed till date a total of 9 ICPs
• Highway Efficiency (45%): This will consist of an (Integrated Check Posts), which are located across
operating speed of traffic, traffic volume, delay at toll India’s international land border:
plazas among others. o Attari - Handing India’s trade with Pakistan
• Highway Safety (35%): This will look at accidents o Agartala, Petrapole, Srimantapur and Sutarkandi
on the highways per year, ambulance response time, - All handling India’s trade with Bangladesh
road clearance after an accident, etc. o Raxaul and Jogbani - Both handling India’s trade
• User Friendly (20%): This will look at the number with Nepal
of footpaths, junctions, adequate structures, etc. o Moreh - Handling India’s trade with Myanmar
• Several new ICPs are coming up and their total
National Highways have been covered in the rating number is likely to touch 24 by 2030.
mechanism: • India’s border management ecosystem with land
• The rating has been done for all 219 national highway ports is very much in sync with the obligations of the
stretches across the country. They cover a distance of WTO Trade Facilitation Agreement.
18,668 km.
• Four corridors are selected for rating: Agra-Mumbai STAND UP INDIA SCHEME
(1,084 km), Pune-Vijayawada (856 km), Mumbai- • In News: Recently, the Ministry of Finance has
Kolkata (1,927 km), Bangalore-Kanyakumari (655 extended the Standup India Scheme up to the year
km). 2025.
• Best and worst Highway according to the rating
mechanism: About the Stand Up India Scheme:
o Best: 102-km stretch of the six-lane Ahmedabad- • Launched on 5 April 2016 to promote
Vadodara section of National Highway (NH)-48. entrepreneurship at the grass-root level of economic
o Worst: 45-km stretch Indore-Dewas section of empowerment and job creation.
NH-3, which connects Agra to Mumbai.
• Aim: to leverage the institutional credit structure to
reach out to the underserved sector of people such as
LAND PORTS AUTHORITY OF INDIA SCs, STs and Women Entrepreneurs.
• In News: Recently, the Land Ports Authority of India • Objective: to facilitate bank loans between Rs.10
(LPAI) celebrated its 9th Foundation Day at its lakh and Rs.1 crore to at least one SC or ST borrower
headquarters in New Delhi. and at least one woman borrower per bank branch
for setting up a Greenfield enterprise.
About LPAI: • The offices of SIDBI and NABARD shall be designated
• Status: Statutory body (created by Land Ports Stand-Up Connect Centres (SUCC).
Authority of India Act, 2010).
• Established in: 2012. Eligibility under Stand Up India Scheme:
• Headquartered: New Delhi. • SC/ST and/or women entrepreneurs; above 18 years
• Ministry: Ministry of Home Affairs. of age.
• Role and Functions: • Loans under the scheme are available for only
o It develops, sanitizes and manages the facilities Greenfield project.
for cross-border movement of passengers and • Borrower should not be in default to any bank or
goods at designated points along the financial institution.
international borders of India. • In case of non-individual enterprises at least 51% of
o LPAI may put in place systems, which address the shareholding and controlling stake should be held
security imperatives at the Integrated Check by either an SC/ST or Woman entrepreneur.
Posts (ICPs) on the border.
o It can develop and provide consultancy, Performance so far:
construction or management services, and • Banks have sanctioned more than ₹25,000 crore to
undertake operations in India and abroad over 1.14 lakh accounts.
regarding ICP. • The scheme has benefited more than 93,094 women
• Power: entrepreneurs.

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OnlyIAS UDAAN PLUS: ECONOMY

GRAM UJALA • A link of all property transactions will get established.

• Delivery of citizen services of land records through
• In News: Recently, the Government has launched the
the single window.
Gram UJALA Programme - an ambitious scheme
offering the world’s cheapest LED bulbs in rural areas • Sharing of land records data across departments,
at a mere Rs. 10. financial institutions and all stakeholders.

About Gram UJALA Programme Digital India Land Record Modernization Programme
(DILRMP):
• Under the programme, 7 watts and 12-Watt LED
bulbs with 3 years warranty will be given to rural • The DILRMP was previously known as the National
consumers against submission of working Land Record Modernization Programme (NLRMP).
Incandescent bulbs. • Central Sector scheme
• LEDs will be available for only Rs 10 each for each • Launched in 2008 with the purpose to digitize and
household. modernizing land records and developing a
centralized land record management system.
• Each household will get up to 5 LEDs.
• In the first phase, 15 million LED bulbs will be • The Department of Land Resources (Ministry of
distributed across villages of Aarah (Bihar), Varanasi Rural development) has proposed a further
(Uttar Pradesh), Vijaywada (Andhra Pradesh), extension to 2023-24, to complete its original targets
Nagpur (Maharashtra), and village in western as well as expand its ambit with a slew of new
Gujarat. schemes.
• The Gram Ujala programme will be implemented in • The DILRMP is the amalgamation of two projects:
villages of the 5 districts only. 1. Computerization of Land Records (CLR)
2. Strengthening of Revenue Administration and
• These rural households will also have metres
Updating of Land Records (SRA & ULR)
installed in their houses to account for usage.
• The district will be taken as the unit of
• Financing Mechanism:
implementation, where all activities under the
o The programme will be financed entirely through
programme will converge.
carbon credits and will be the first such
programme in India. • Components of DILRMP:
o The revenue earned from carbon credits will o Computerization of land record
contribute Rs. 60 per LED bulb piece, with the o Survey/re-survey
balance Rs. 10 to be paid by the rural consumer. o Computerization of Registration
• Key features:
o Unique Land Parcel Identification Numbers
UNIQUE LAND PARCEL IDENTIFICATION o It is just like the Aadhar Number of land parcels.
NUMBER (ULPIN) SCHEME o A unique ID based on Geo-coordinates of the
• In News: Recently, ‘Bhumi Samvaad’ – a National parcels is generated and assigned to the plots.
Workshop on Digital India Land Record o This has been introduced to share the
Modernisation Programme (DILRMP) was held at computerized digital land record data among
India Habitat Centre here in the national capital. different States/Sectors and a uniform system of
assigning a unique ID to the land parcel across
About the Scheme: the country.
• Under the scheme, a 14-digit identification number
will be issued to every plot of land in the country. MARITIME INDIA SUMMIT 2021
• Being described as “the Aadhaar for land” a
• In News: Recently, ‘Maritime India Summit 2021’ has
number that would uniquely identify every surveyed
been organised by the Ministry of Ports, Shipping and
parcel of land and prevent land fraud, especially in
Waterways.
rural India, where land records are outdated and
disputed.
About
• The identification will be based on the longitude
• Organised by: Maritime India Summit is being
and latitude of the land parcel, and is dependent on
organised by the Ministry of Ports, Shipping &
detailed surveys and geo-referenced cadastral maps.
Waterways. The FICCI will act as the Industry Partner
• This is the next step in the Digital India Land
in this summit.
Records Modernisation Programme (DILRMP),
• Partner Country: Denmark is the partner country
which began in 2008.
for the Maritime India Summit.
• Proper land statistics and land accounting through
• Objective: To visualise a roadmap for India’s
ULPIN will help develop land banks and lead towards
maritime sector for the next decade. Further, the
Integrated Land Information Management System
summit will aid India to become the forefront of the
(ILIMS).
global maritime sector.
Benefits: • Participants: Various stakeholders in the maritime
sector, eminent policy planners, domestic and
• Benefits are to ensure uniqueness in all transactions
international investors, industry experts, thought
and keep the land records always up-to-date.

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OnlyIAS UDAAN PLUS: ECONOMY

leaders, technology providers, representatives of About AIM-PRIME:

major ports and shipping lines, etc. • Aim: promoting science-based, deep technology.
• Significance: Eminent persons from several • It will provide training and guidance over a period of
countries are attending the summit. There is also 12 months.
potential business opportunities and investments in • Implementation: Venture Center – a non-profit
the maritime domain due to the summit. technology business incubator.
• Functions: • Beneficiaries:
o Project vast investment opportunities in each of o Technology developers (early-stage deep tech
the Indian maritime States and UTs. start-ups, and scientists/ engineers/ clinicians)
o Showcase the latest technology, products and with strong science-based deep tech business
services. ideas.
o Help disseminate knowledge about the latest o CEOs and Senior incubation managers of AIM
developments in the maritime sector. Funded Atal Incubation Centers that are
o Provide a platform to interact closely to explore supporting deep tech entrepreneurs.
business opportunities. • Benefits:
o The candidates selected for the program will get
Initiatives launched at the Maritime India Summit: access to in-depth learning resources via a
• E-Book of Maritime Vision Policy 2030: It aims to comprehensive lecture series, live team projects,
make the Indian maritime industry at par with the exercises, and project-specific mentoring.
top global benchmarks in the next 10 years. o They will also have access to a deep tech startup
• Sagar-Manthan: Mercantile Marine Domain playbook, curated video library, and plenty of
Awareness Centre (MMDAC) - It is an information peer-to-peer learning opportunities.
system for enhancing maritime safety, search and
rescue capabilities, security and marine environment Deep technology:
protection. • It is an outcome of very intense research and
development (R&D) with high knowledge content.
Other Facts: • The benefits of this program are aimed at addressing
• Capacity of major ports has increased from 870 specific issues through training and guidance over a
million tonnes (2014) to 1550 million tonnes. period of 12 months
• Mega ports with world class infrastructure are being
developed in Vadhavan, Paradip and Deendayal Port INDIA ENERGY DASHBOARDS
in Kandla.
• In News: Recently, the government think tank NITI
• India aims to operationalise 23 waterways by 2030.
Aayog has launched India Energy Dashboards (IED)
• India has 189 lighthouses across its vast coastline.
Version 2.0.
• It has formulated a programme for developing
tourism in the land adjacent to 78 lighthouses.
About India Energy Dashboards:
• Steps are being taken to introduce urban water
• Aims to provide single-window access to the energy
transport systems in key states and cities such as
data for the country.
Kochi, Mumbai, Gujarat and Goa.
• Purpose: The dashboard compiles Energy data
published/provided by various sources. Like the
AIM-PRIME Central Electricity Authority, Coal Controller’s
• In News: Recently, the Atal Innovation Mission Organisation and Ministry of Petroleum and Natural
(AIM), NITI Aayog launched AIM-PRIME (Program Gas.
for Researchers on Innovations, Market-Readiness & • Features:
Entrepreneurship). o India Energy Dashboards (IED) provides time-
series data from FY 2005-06 until FY 2019-20;
Atal Innovation Mission: o The dashboard enables easy downloading of data
• Government of India’s flagship initiative to promote a into convenient spreadsheet formats in a cleaner
culture of innovation and entrepreneurship in the way;
country. o It provides data at sub-yearly frequencies as well.
• Objective: To develop new programmes and policies This includes monthly data and data from portals
for fostering innovation in different sectors of the maintained by the government agencies. Such as
economy, provide platform and collaboration Saubhagya, UJALA, PRAPTI and Vidyut PRAVAH.
opportunities for different stakeholders, create o It also has a ‘Feedback and Suggestions’ forum for
awareness and create an umbrella structure to the engagement of the energy data user
oversee the innovation ecosystem of the country. community
• Major Achievement: AIM’s initiatives have played o A semi-automated workflow will manage
an important contributory role in the advancement of periodic updates to the IED. The workflow
India from a position of 81 in the Global Innovation system performs basic checks and data
Index in 2015 to a position of 48 in 2020. validation, helping to avoid incorrect data entry.

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OnlyIAS UDAAN PLUS: ECONOMY

PRAAPTI Portal: o Raise and track help requests in real-time.

• PRAAPTI is a web portal, launched in 2018 by the o Tech-enabled governance will play a major role
Ministry of Power. in determining India’s competitiveness, in the
• Full-Form: PRAAPTI stands for Payment ratification post-Covid world.
and analysis in power procurement for bringing o It will significantly contribute to the achievement
transparency in invoicing of generators. of India’s export target of $1 trillion by 2025 and
• Aim: enhancing transparency and encouraging best GDP target of $5 trillion.
practices in Power Purchase transactions.
Directorate General of Foreign Trade (DGFT)
Vidyut PRAVAH: • Directorate General of Foreign Trade (DGFT)
• Vidyut PRAVAH is a mobile application launched by established in 1991. It is an attached office of the
the Ministry of Power. Ministry of Commerce and Industry.
• Purpose: to provide data pertaining to: • Functions: It is responsible for formulating and
• The market price of power from power exchange implementing the Foreign Trade Policy with the main
• Value of current all India demand in GW and objective of promoting India’s exports.
• All India and State shortages including peak hour and • Headquarters: New Delhi
total energy shortage.
EATSMART CITIES CHALLENGE AND TRANSPORT
Saubhagya Scheme: 4 ALL CHALLENGE
• Pradhan Mantri Sahaj Bijli Har Ghar Yojana – • In News: Recently, the Ministry of Housing and Urban
‘Saubhagya’ was launched in September, 2017 with a Affairs launched the EatSmart Cities Challenge and
target to electrify all households by December 2018. Transport 4 All Challenge.
• All the states had declared on Saubhagya portal that
all the willing un-electrified households had been About EatSmart Cities Challenge:
electrified as on 31st March 2019, except 18,734 • EatSmart Cities Challenge is organized by the
households in LWE (left wing extremist) affected Ministry of Housing and Urban Affairs. The challenge
areas of Chhattisgarh. is organised in association with the Food Safety and
Standards Authority of India(FSSAI) under the
UJALA Scheme Ministry of Health and Family Welfare.
• UJALA (Unnat Jyoti by Affordable LEDs for All) is a • Aim: The aim is to motivate Smart Cities to develop a
zero-subsidy scheme launched by the Government in plan that supports a healthy, safe and sustainable
2015. food environment.
• It is touted as the world’s largest domestic lighting • This plan would receive support from institutional,
project. physical, social, and economic infrastructure. Along
• Every domestic household having a metered with that the application of ‘smart’ solutions to
connection from their respective Electricity combat food-related issues.
Distribution Company is eligible to get the LED bulbs • Key Features of the Challenge:
under the Scheme. o As part of the Challenge, competition will
organize among cities to recognize their efforts.
TRADE FACILITATION MOBILE APPLICATION This includes efforts in adopting and scaling up
• In News: Recently, Union Minister of Commerce and various initiatives under Eat Right India.
Industry has launched the Directorate General of o This will create an environment of the right food
Foreign Trade’s (DGFT) Trade Facilitation Mobile practices and habits. It also strengthens the food
Application. safety, regulatory environment and build
awareness among the consumers.
About Trade Facilitation Mobile Application: • Eligibility: The challenge is open to all Smart Cities,
• Tata Consultancy Services (TCS) developed the Trade capital cities of States /UTs, and cities with a
Facilitation Mobile Application. It is as per the population of more than 5 lakh.
directions of the Directorate General of Foreign Trade • Selection: At the end of the first phase of the
(DGFT). challenge, 11 cities will be selected. After that, these
• Aim: The aim is to promote ease of doing business by cities will go for deeper engagement for an extended
providing quick access to information to period to implement their vision.
importers/exporters.
• Features: About Transport 4 All (T4All) Challenge:
o Real-time trade policy updates and event • The Ministry of Housing and Urban Affairs launched
notifications. Transport 4 All challenge. The ministry is
o It provides options to explore Export-Import collaborating with the Institute for Transportation
policies and statistics. and Development Policy(ITDP), a Non-governmental
o Virtual Assistance to trade-related queries. organization.
o It provides access to all the services provided by
DGFT.
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OnlyIAS UDAAN PLUS: ECONOMY

• Aim: The aim is to develop digital solutions that will • InvITs can be treated as the modified version of REITs
make public transport safe, affordable, comfortable, designed to suit the specific circumstances of the
and reliable for all. infrastructure sector
• Key Features: • The InvITs are regulated by the SEBI (Infrastructure
o The citizens will not only define the problems Investment Trusts) Regulations, 2014.
and create solutions, but also help start-ups and • Four elements:
cities to refine the solutions to meet their needs. 1. Trustee has the responsibility of inspecting the
o The first edition of the T4All Challenge focuses on performance of an InvIT.
digital innovation. Thus, cities and start-ups will 2. Sponsor(s) are promoters of the company that
receive guidance to develop and test various set up the InvIT.
solutions, learn from them and scale them. 3. Investment Manager is entrusted with the task of
o All this will build people’s trust in public supervising the assets and investments of the
transport and enhance their mobility. InvIT.
o Further, the solutions will make public 4. Project Manager is responsible for the execution
transport—formal as well as informal— safe, of the project.
convenient, and affordable for all.
• Eligibility: All the Smart Cities Mission cities, capitals PLI SCHEME FOR ADVANCED CHEMISTRY CELL
of states and union territories (UTs), and all cities BATTERY STORAGE
with a population of over 5 lakhs—are eligible for the
• In News: Recently, the Union Cabinet has approved a
Challenge.
Rs. 18,100-crore Production Linked Incentive (PLI)
scheme for manufacturers of Advanced Chemistry
POWER GRID INFRASTRUCTURE INVESTMENT Cell (ACC) battery storage, to reduce imports.
TRUST
• In News: Recently, the Power Grid Corporation of About NPACC Scheme:
India (PGCIL) launched its Infrastructure Investment • The plan is to set up 50 gigawatt hour (GWh)
Trust (InvIT) - PowerGrid Infrastructure Investment manufacturing capacity for ACC batteries by
Trust (PGInvIT). attracting investments totaling Rs. 45,000 crore.
• Requires each selected ACC battery Storage
About PGInvIT: manufacturer to set-up an ACC manufacturing facility
• The first time a state-owned entity (PGCIL) is of minimum 5 GWh capacity, achieve a domestic
monetizing its infrastructure assets through the value addition of at least 25% and incur the
InvIT route. mandatory investment Rs.225 crore /GWh within 2
• This will be only the third InvIT to be listed in the Years.
Indian markets, after IRB InvIT and India Grid Trust, • Furthermore, the beneficiary firms need to ensure a
both of which went public in 2017. minimum 60% domestic value addition at the Project
• The InvIT route was proposed by the Centre as an level within five years.
alternative fundraising route for state-run companies • The incentive will be disbursed over a period of five
to manage funding requirements without having to years. It will be paid out on the basis of sales, energy
depend on government support. efficiency, battery life cycle, and localization levels.

About Power Grid Expected Benefits:

• Power Grid Corporation of India Limited • Facilitate demand creation for battery storage in
(POWERGRID), is a schedule ‘A’ ‘Maharatna’ Public India.
Sector Enterprise of Govt. of India which was • Facilitate Make-in-India and Atmanirbhar Bharat.
incorporated on 23rd Oct 1989 under the Companies • Facilitate demand for Electric Vehicles (EVs), which
Act, 1956. are proven to be significantly less polluting.
• It is a listed Company, with 51.34% holding of • Import substitution of around Rs. 20,000 crore every
Government of India and the balance is held by year.
Institutional Investors and public. • Impetus to Research & Development to achieve
• It is operating under the Ministry of Power. higher specific energy density and cycles in ACC.
• Promote newer and niche cell technologies.
About Infrastructure Investment Trust (InvIT):
• It is a Collective Investment Scheme similar to a About the PLI scheme:
mutual fund. • Aims to give companies incentives on incremental
• It enables direct investment of money from sales from products manufactured in domestic units.
individual and institutional investors in • It invites foreign companies to set units in India,
infrastructure projects to earn a small portion of the however, it also aims to encourage local companies to
income as return. set up or expand existing manufacturing units.
• InvITs work like real estate investment trusts (REITs) • The PLI Scheme has also been approved for sectors
in features. such as automobiles, pharmaceuticals, IT hardware
including laptops, mobile phones & telecom
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OnlyIAS UDAAN PLUS: ECONOMY

equipment, white goods, chemical cells and textiles, • Adoption of the Fourth Industrial Revolution
etc. (Industry 4.0): It will improve manufacturing
processes, material usage, energy efficiency, plant
Advanced Chemistry Cell (ACC): and worker productivity, supply chain and product
• ACCs are the new generation of advanced storage life-cycle.
technologies that can store electric energy either as • Steel Research and Technology Mission of India:
electrochemical or as chemical energy and convert it It provides for the grant of financial assistance to
back to electric energy as and when required. various institutions including CSIR laboratories and
• Such battery storages will cater not only to electric academic institutions for carrying out research in the
vehicles but also to the consumer electronics iron and steel sector.
industry and electricity grids.
PLI SCHEME FOR TEXTILES
PRODUCTION-LINKED INCENTIVE (PLI) SCHEME • In News: Recently, the Union cabinet has approved
FOR SPECIALTY STEEL the Production Linked Incentive (PLI) scheme for the
• In News: Recently, the Union Cabinet recently textile sector.
approved the Production Linked Incentive (PLI)
Scheme for specialty steel with an outlay of Rs 6,322- About PLI scheme for Textiles:
crore. • It is part of the overall announcement of PLI Schemes
for 13 sectors made earlier during the Union Budget
PLI for Speciality Steel: 2021-22, with an outlay of Rs. 1.97 lakh crore.
• Aim: To help India's SS production reach 42 Million • PLI for Textiles along with RoSCTL, RoDTEP and
Tonnes (MT) by 2026-27 from 18 MT today. other measures of Government in the sector e.g.
• Categories: There are five categories of specialty providing raw material at competitive prices, skill
steel which have been chosen in the PLI Scheme: development etc will herald a new age in textiles
o Coated/plated steel products. manufacturing.
o High strength/wear resistant steel. • Aim: To promote industries that invest in the
o Speciality rails. production of 64 select products.
o Alloy steel products and steel wires. • Product lines include:
o Electrical steel. o 40 in man-made fibre apparel,
• Slabs: There are three slabs of PLI incentives, the o 14 in man-made fibre fabrics, and
lowest being 4% and highest being 12%. o 10 technical textile segments/products.
• Beneficiaries: Both big players i.e. integrated steel • The investment period is 2 years, and the incentive
plants and to the smaller players (secondary steel will be paid for 5 years after the first year of post-
players). investment operation.
• Any company registered in India, engaged in • The scheme is for two types of investments:
manufacturing of the identified ‘specialty steel’ 1. The first entails a minimum of Rs. 300 crores in
grades will be eligible to participate in the scheme. plant, machinery, equipment and civil works in a
unit. The unit must register a minimum turnover
Speciality Steel: of Rs 600 crores once it commences operation.
• It is value-added steel, which is made by processing 2. The second is for a minimum of Rs. 100 crore,
normal finished steel. where the business achieves a minimum
• It is done by converting normal finished steel into turnover of Rs 200 crores.
high value-added steel by way of coating, plating and • The incentive is based on a combination of
heat treatment. investment and turnover.
• Apart from the automobile sector and specialised • Priority will also be given to investment in
capital goods, they can be used in various strategic aspirational districts, Tier3, Tier4 towns, and rural
applications such as defence, space, power etc. areas.
• SS are categorized in various types such as, • Expected Benefits:
coated/plated steel products, high strength/wear o Increase in Investment and Employment
resistant steel, speciality rails, alloy steel products o Focus on Aspirational Districts
and steel wires, electrical steel etc. o Lower dependence on imports

Initiatives related to Steel: Man-made Fibre:

• Mission Purvodaya: Launched in 2020 for the • Manmade fibres are made from various chemicals or
accelerated development of eastern India through are regenerated from plant fibres.
the establishment of an integrated steel hub in • Examples: Polyester; Polyamide (nylon); Acrylics;
Kolkata, West Bengal. Viscose, made from wood bark; Kevlar, a high-
• National Steel Policy 2017: To attain Self- performance fibre; and Nomex, a high-performance
sufficiency in steel production by providing policy fibre
support & guidance to private manufacturers, MSME • Importance of Man-made Fiber in World Market:
steel producers, it was launched in 2017.
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OnlyIAS UDAAN PLUS: ECONOMY

o 80% of the total Chinese textile export was man- o Access and Customer Premises Equipment
made fibre based. (CPE), Internet of Things (IoT) Access Devices,
o 70% of the total global fibre manufacturing and and Other Wireless Equipment
consumption, 70% is man-made fibre related, o Enterprise equipment: Switches, Routers
while in India it is just about 35%. • Eligibility for the Scheme:
o MSMEs – Minimum Threshold of Investment ₹ 10
India’s position: Crores
• Indian production and export of textile and clothing o Other than MSMEs – Minimum Threshold of
products are largely cotton based. Investment ₹ 100 Crores
• In 2018-19, while Indian textile and clothing exports • Incentives: An incentive of 7% to 4% on incremental
amounted to about $36 billion, less than one third sales (over base year) of goods manufactured in
was man-made fibre based. India. Further, for MSMEs, the scheme has a 1%
• Annual textile and clothing exports have remained higher incentive in the first three years.
largely stagnant over the last seven years.
• India is ranked sixth in the global trade in this sector. SWAMIH INVESTMENT FUND
• Competitors: Bangladesh and Vietnam have gained a • In News: Recently, the SWAMIH (Special Window for
sizeable share in the man-made fibre segment of the Affordable & Mid-Income Housing) fund has made its
global textile trade first complete exit from an investment made for
completion of a residential project in Mumbai.
Textile Industry
• A labour intensive sector that employs 45 Mn people About SWAMIH:
in India and is second only to the agriculture sector in • SWAMIH Investment Fund: Formed to complete
terms of employment. construction of stalled, RERA-registered affordable
• It is one of the oldest industries in the Indian and mid-income category housing projects which are
economy, and is a storehouse and carrier of stuck due to paucity of funds.
traditional skills, heritage and culture.
• Set up: as a Category-II AIF (Alternate Investment
Fund) debt fund registered with SEBI.
Division:
• Investment Manager of the Fund: SBICAP Ventures,
• The unorganised sector is small scale and uses a wholly-owned subsidiary of SBI Capital Markets,
traditional tools and methods. It consists of which in turn is a wholly-owned subsidiary of the
handloom, handicrafts and sericulture (production of State Bank of India.
silk).
• Sponsor of the Fund: The Secretary, Department of
• The organised sector uses modern machinery and Economic Affairs, Ministry of Finance, Government of
techniques and consists of the spinning, apparel and India on behalf of the Government of India.
garments segment.
• Eligibility Criteria:
o The real estate projects seeking last-mile funding
PLI SCHEME FOR PROMOTING TELECOM AND from SWAMIH must be Real Estate (Regulation
NETWORKING PRODUCTS MANUFACTURING IN and Development) Act (RERA)-registered which
INDIA have been stalled due to a lack of adequate funds.
• In News: Recently, the Minister of State for o Must fall under the ‘Affordable and Middle
Communications has launched the Production Linked Income Project’ category (any housing projects
Incentive (PLI) Scheme for Telecom and Networking wherein housing units do not exceed 200 sq.m.).
Products. o Net-worth positive projects are also eligible for
SWAMIH funding.
About PLI Scheme for Telecom Sector:
• It is for domestic manufacturing of telecom and RERA
networking products such as switches, routers, • Establishment: Real Estate (Regulation and
4G/5G radio access network, etc. It will be Development) Act (RERA) is an act passed by the
operational from 1st April, 2021. Parliament in 2016 that came into effect fully from
• Objective: 1st May, 2017. The Act establishes Real Estate
o To boost domestic manufacturing in the telecom Regulatory Authority (RERA) in each state for
and networking products by incentivising regulation of the real estate sector and also acts as an
incremental investments and turnover. adjudicating body for speedy dispute resolution.
o To reduce India’s dependence on other countries • Aim: It seeks to protect home-buyers as well as help
for the import of telecom and networking boost investments in the real estate sector by
products. bringing efficiency and transparency in the
• Target segments: sale/purchase of real estate.
o Core Transmission Equipment
o 4G/5G, Next-Generation Radio Access Network E-WAY BILL INTEGRATION WITH FASTAG, RFID
and Wireless Equipment

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OnlyIAS UDAAN PLUS: ECONOMY

• In News: Recently, the Union Government has • Aligned with global best practices and aided by
integrated the E-Way Bill (EWB) system with FasTag emerging technologies such as AI and ML, MCA21 V3
and RFID. is envisioned to transform the corporate regulatory
environment in India.
Electronic Way (E-Way) Bill:
• It is a unique bill number generated for the specific Components of MCA21 V3:
consignment involving the movement of goods. • E-Scrutiny: MCA is in process of setting up a Central
• Under the Goods and Services Tax (GST) regime, Scrutiny Cell which will scrutinise certain Straight
EWBs are mandatory for inter-state transportation of Through Process (STP) Forms filed by the corporates
goods valued over Rs. 50,000 from April 2018, with on the MCA21 registry and flag the companies for
the exemption to precious items such as gold. more in-depth scrutiny.
• It is a mechanism to ensure that goods being • E-adjudication: E-adjudication module will provide
transported comply with the GST Law and is a tool to a platform for conducting online hearings with
track movement of goods and check tax evasion. stakeholders and end to end adjudication
electronically.
FASTags • E-Consultation: To automate and enhance the
• FASTags are stickers that are affixed to the current process of public consultation on proposed
windscreen of vehicles and use Radio Frequency amendments and draft rules etc., e-consultation
Identification (RFID) technology to enable digital, module of MCA21 v3 will provide an online platform.
contactless payment of tolls without having to stop at • Compliance Management System (CMS): CMS will
toll gates. assist MCA in identifying non-compliant
• The tags are linked to bank accounts and other companies/LLPs, issuing e-notices to the said
payment methods. defaulting companies/LLPs etc.
• As a car crosses a toll plaza, the amount is
automatically deducted, and a notification is sent to MCA 21
the registered mobile phone number. • MCA21 is an e-Governance initiative of Ministry of
• From 15th February, 2021, FASTag has become Corporate Affairs (MCA) that enables easy and secure
compulsory for all vehicles across the country. access of the MCA services to the corporate entities,
• It is operated by National Highway Authority of India professionals and citizens of India.
(NHAI). • It is the first Mission Mode e-Governance project of
GoI.
Radio Frequency Identification (RFID)
• It uses radio waves to communicate between two ONE NATION-ONE STANDARD MISSION
objects: a reader and a tag. • In News: Recently, Indian Railways Research Design
• RFID communication is the same as two way radio & Standards Organization(RDSO) has become the
communication in the sense that information is nation’s first institution to be declared as Standard
transmitted or received via a radio wave at a specific Developing Organization(SDO) under the “One
frequency. Nation One Standard” mission.
• Passive tags collect energy from a nearby RFID
reader's interrogating radio waves. About One Nation One Standard Mission:
• Active tags have a local power source such as a • One Nation One Standard was first conceived in 2019
battery and may operate at hundreds of meters from by the Bureau of Indian Standards(BIS).
the RFID reader. • The mission is on the line of one nation, one ration
card scheme in order to ensure quality products in
MCA21 V3.0 the country.
• In News: Recently, the government of India has • Objective:
launched the first phase of the MCA21 version 3.0 to o To aggregate and integrate the existing
its digital corporate compliance portal. capabilities in standardisation.
o To enable the convergence of all standard
About MCA21 3.0 development activities in the country, resulting
• MCA21 V3 is a technology-driven forward-looking in One National Standard for One Subject.
project, envisioned to strengthen enforcement,
promote Ease of Doing Business, enhance the user Research Designs & Standards Organization:
experience, and facilitate seamless integration and • It is the sole R&D Wing of the Ministry of Railways, is
data exchange among Regulators. one of India’s leading Standard formulating bodies
• The project will have Micro-services architecture undertaking standardization work for the railway
with high scalability and capabilities for advanced sector situated in Lucknow, Uttar Pradesh.
analytics.
• It will have additional modules for e-Adjudication, e- Bureau of Indian Standards (BIS):
Consultation and Compliance Management.

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OnlyIAS UDAAN PLUS: ECONOMY

• The Bureau of Indian standards (BIS) Act 2016 • It has about 14,500 km of navigable waterways
establishes the Bureau of Indian Standards (BIS) as which comprise rivers, canals, backwaters, creeks,
the National Standards Body of India. etc.
• The Act enables the Central Government to appoint • Its operations are currently restricted to a few
any authority/agency, in addition to the BIS, to verify stretches in the Ganga-Bhagirathi-Hooghly rivers, the
the conformity of products and services with the Brahmaputra, the Barak river, the rivers in Goa, the
established standard and issue certificate of backwaters in Kerala, inland waters in Mumbai and
conformity. the deltaic regions of the Godavari - Krishna rivers.
• BIS is the only national body that frames standards. • Freight transportation by waterways is highly
• It works under the aegis of Ministry of Consumer underutilized in the country as compared to
Affairs, Food & Public Distribution, Government of developed countries.
India. • India's hinterland connectivity is mainly based on
• BIS is responsible for the harmonious development of road and rail with domestic waterways— both
the activities of standardization, marking and quality coastal shipping and inland waterways—playing a
certification of goods and for matters connected limited role.
therewith or incidental thereto.
National Waterways Of India:
INLAND VESSELS BILL • National Waterway 1:
o It starts from Allahabad (Prayagraj) to Haldia
• In News: Recently, the Union Cabinet approved the
with a distance of 1620 km.
Inland Vessels Bill, 2021, which will replace the
o It is be the longest National Waterways in India.
Inland Vessels Act, 1917 after passing in Parliament.
• National Waterway 2:
o It is a stretch on the Brahmaputra river from
Features of the Bill:
Sadiya to Dhubri in Assam state.
• Unified law: for the entire country, instead of
o The NW 2 is one of the major freight
separate rules framed by the States.
transportation waterways of northeast India and
• The certificate of registration granted under the the third-longest Waterways with and a total
proposed law will be deemed to be valid in all States length of 891 km.
and UTs, and there will be no need to seek separate
• National Waterway 3:
permissions from the States.
o It is located in Kerala state and runs from Kollam
• Central data base: for recording the details of vessel, to Kottapuram.
vessel registration, crew on an electronic portal. o The 205 km long West Coast Canal is India’s first
• It requires all mechanically propelled vessels to waterway with all-time navigation facility.
be mandatorily registered. All non-mechanically o The NW3 is consists of the West Coast Canal,
propelled vessels will also have to be enrolled at Champakara Canal, and Udyogmandal Canal and
district, taluk or panchayat or village level. runs through Kottappuram, Cherthala,
• It enlarges the definition of ‘inland waters’, by Thrikkunnapuzha Kollam, and Alappuzha.
including tidal water limit and national waterways • National Waterway 4:
declared by the Central Government. o It is connected from Kakinada to Pondicherry
• It also deals with pollution control measures of through Canals, Tank, and River Godavari along
Inland Vessels. This Bill directs the Central with Krishna river.
Government to designate a list of chemicals, o The NW 4 the second-longest waterway of India
substances, etc. as pollutants. with a total length of 1095 km in Andhra Pradesh
and Tamil Nadu.
Inland Water Transport (IWT) in India: • National Waterway 5:
• India has about 14,500 km of navigable waterways o It connects Orissa to West Bengal using the
which comprise of rivers, canals, backwaters, creeks, stretch on Brahmani River, East Coast Canal,
etc. Matai river, and Mahanadi River Delta.
• IWT is a fuel-efficient and environment-friendly o The 623 km long canal system will handle the
mode. traffic of cargo such as coal, fertilizer, cement,
• As per the National Waterways Act 2016, 111 and iron.
waterways have been declared as National • National Waterway 6:
Waterways (NWs). o It is the proposed waterway in Assam state and
• The Inland Waterways Authority of India (IWAI) is will connect Lakhipur to Bhanga in river Barak.
implementing the Jal Marg Vikas Project (JMVP) at an o The 121 km long waterway will help in trading
estimated cost of ₹5369.18 crores for capacity between the town of Silchar to Mizoram State.
augmentation of navigation on the Haldia-Varanasi
stretch of Ganga (part of NW-1) with the technical Inland Waterways Authority of India:
and financial assistance of the World Bank. • It came into existence on 27th October 1986 for
development and regulation of inland waterways for
Inland Water Transport in India: shipping and navigation.

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OnlyIAS UDAAN PLUS: ECONOMY

• It primarily undertakes projects for development and from key logistic nodes; layers of terrain and urban
maintenance of IWT (Inland Water Transport) infrastructure.
infrastructure on national waterways through grants • It aims to provide information on available land for
received from the Ministry of Shipping. prospective investors looking at setting up units in
• Headquartered at Noida (Uttar Pradesh). the Country.
• It also provides links to State GIS Portals and State
INTEGRATED POWER DEVELOPMENT SCHEME Land Banks.
• In News: Recently, A 50 kWp Solar rooftop in Solan,
Geographic Information System (GIS):
Himachal Pradesh was inaugurated under Integrated
• A GIS is a computer system for capturing, storing,
Power Development Scheme (IPDS) of the MInistry of
checking, and displaying data related to positions on
Power.
Earth’s surface.
• By relating seemingly unrelated data, GIS can help
About IPDS:
individuals and organizations better understand
• Power Finance Corporation (PFC) is the Nodal agency
spatial patterns and relationships.
for implementation of the scheme.
• GIS can use any information that includes location.
• Launched in 2014 by Ministry of Power
The location can be expressed in many different
• Components:
ways, such as latitude and longitude, address, or ZIP
1. Strengthening of sub-transmission and
code.
distribution network in the urban areas.
• GIS can include data about people, such as
2. Metering of distribution transformers /feeders /
population, income, or education level.
consumers in the urban areas.
• It can also include information about the sites of
3. IT enablement of distribution sector and
factories, farms, and schools, or storm drains, roads,
strengthening of distribution network under R-
and electric power lines etc.
APDRP.
• Eligibility: All Power Distribution Companies
(Discoms) are eligible for financial assistance under NATRAX
the scheme • In News: Recently, the Minister of Heavy Industries
• Objective: and Public Enterprises inaugurated NATRAX- the
o 24×7 Power supplies for consumers. High Speed Track in Pithampur, Indore (Madhya
o Reduction of AT&C (aggregate technical and Pradesh).
commercial) losses.
o Providing access to power to all households. About NATRAX:
• Significance of the scheme: The scheme will help in • It is one of the state-of-the-art automotive testing and
reduction in AT&C losses; establishment of IT certification centre under National Automotive
enabled energy accounting / auditing system, Testing and Research and development (R&D)
improvement in billed energy based on metered Infrastructure Project (NATRIP)
consumption and improvement in collection • NATRIP is the largest and most significant initiative
efficiency. in the automotive sector which comprises
• Funding Pattern: representatives from the Government of India, a
o GoI (Government of India) Grant: 60% (85% for number of State Governments and Indian Automotive
special category States). Industry.
o Additional Grant: 15% (5% for special category • Located only 50 km away from Indore, the financial
States) - linked to achievement of milestones. capital of Madhya Pradesh.
• It is a flagship project of the Ministry of Heavy
LAND BANKS/INDIA INDUSTRIAL LAND BANK Industries.
• In News: Recently, he India Industrial Land Bank • It aims to create a state of the art testing, validation
(IILB), a GIS-based portal, has seen a 30% increase in and R&D infrastructure in the country.
page views each month since April 2021. • It is a world class 11.3 km High Speed Track. The
track is the longest in Asia and the fifth-largest in the
India Industrial Land Bank (IILB): world.
• Department for Promotion of Industry & Internal
Trade (DPIIT) has developed IILB portal, a GIS- Features of the High Speed Track (HST):
enabled database of industrial areas/clusters across • The vehicle can achieve a max speed of 375 Kmph on
the country to adopt a committed approach towards curves with steering control and it has less banking
resource optimization, industrial upgradation and on ovals making it also one of the safest test tracks
sustainability. globally.
• The portal serves as a one-stop solution to the free • It is the one-stop solution for all sorts of high-speed
and easy accessibility of all industrial information performance tests, being one of the largest in the
including availability of raw material, agriculture, world.
horticulture, minerals, natural resources; distance • It can cater to the widest category of vehicles; say
from two-wheelers to the heaviest tractor trailers
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OnlyIAS UDAAN PLUS: ECONOMY

Significance of HST: communications. Since fibre-optic cable transmits

• HST is used for measuring the maximum speed information in the form of light pulses, a ‘dark’ cable
capability of high-end cars like BMW, Mercedes, Audi, refers to one through which light pulses are not being
Ferrari, Lamborghini, Tesla and so forth which transmitted.
cannot be measured on any of the Indian test tracks. • Companies lay extra optical fibres in order to avoid
• Being centrally located in Madhya Pradesh, it is cost repetition when more bandwidth is needed.
accessible to most of the major OEMs. • It is also known as unlit fibre.
• Foreign OEMs will be looking at NATRAX HST for the
development of prototype cars for Indian conditions. REVAMPED DISTRIBUTION SECTOR SCHEME
• At present, foreign OEMs go to their respective high- In News: Recently, the Cabinet Committee on Economic
speed track abroad for high-speed test requirements. Affairs has approved a Reforms-based and Results-linked,
Revamped Distribution Sector Scheme worth Rs. 3.03
BHARATNET trillion wherein the Centre’s share will be Rs. 97,631
• In News: Recently, Union Cabinet has accorded crore.
approval for the revised implementation strategy of
BharatNet through Public-Private Partnership (PPP) About the scheme:
mode in 16 States of the country. • It is a reforms-based and results-linked scheme.
• Aim: To improve the operational efficiencies and
Strategy: financial sustainability of all DISCOMs/Power
• The government will provide Rs 19,041 crore as Departments excluding Private Sector DISCOMs.
viability gap funding for the project. • It envisages the provision of conditional financial
• BharatNet will now extend up to all inhabited villages assistance to DISCOMs for strengthening supply
beyond the gram panchayats (GPs) in the said states. infrastructure.
• It includes creation, upgradation, operation, • The assistance will be based on meeting pre-
maintenance and utilisation of Bharat Net by the qualifying criteria as well as upon the achievement
concessionaire who will be selected by a competitive of basic minimum benchmarks by the DISCOM.
international bidding process. • The scheme will be available till 2025-26.
• Objectives:
About Bharat Net: o Reduction of average aggregate technical and
• Bharat Net Project was originally launched in 2011 as commercial loss to pan-India levels of 12-15% by
the National Optical Fibre Network (NOFN) and 2024-25.
renamed as Bharat-Net in 2015. o Narrow the deficit between the cost of electricity
• It seeks to provide connectivity to 2.5 lakh Gram and the price at which it is supplied to zero by
Panchayats (GPs) through optical fibre. 2024-25.
• It is a flagship mission implemented by Bharat o Developing institutional capabilities for modern
Broadband Network Ltd. (BBNL). DISCOMs.
• Objective: to facilitate the delivery of e-governance, e- o Improvement in the quality, reliability, and
health, e-education, e-banking, Internet and other affordability of power supply to consumers
services to rural India. through a financially sustainable and
operationally efficient distribution sector.
Larger Vision: • Components:
• To establish a highly scalable network infrastructure o Consumer Meters and System Meters: It
accessible on a non-discriminatory basis. involves a compulsory smart metering
• To provide on demand, affordable broadband ecosystem across the distribution sector—
connectivity of 2 Mbps to 20 Mbps for all households starting from electricity feeders to the consumer
and on demand capacity to all institutions. level, including in about 250 million households.
• To realise the vision of Digital India, in partnership o Feeder Segregation: Scheme also focuses on
with States and the private sector. funding for feeder segregation for unsegregated
feeders, which would enable solarization under
Implementation: the PM-KUSUM Scheme.
• The project is a Centre-State collaborative project, o Modernization of Distribution system in
with the States contributing free Rights of Way for Urban Areas: Supervisory Control and Data
establishing the Optical Fibre Network. Acquisition (SCADA) in all urban areas.
• The entire project is being funded by Universal o Rural and Urban area System strengthening.
service Obligation Fund (USOF), which was set up for • Merging all the existing power sector reforms
improving telecom services in rural and remote areas schemes: like Integrated Power Development
of the country. Scheme, Deen Dayal Upadhyaya Gram Jyoti Yojana,
and Pradhan Mantri Sahaj Bijli Har Ghar Yojana
Dark fibre: • Implementation: Each state would have its own
• It is an unused optical fibre that has been laid but is action plan for implementation of the scheme rather
not currently being used in fibre-optic than a ‘one-size-fits-all’ approach.
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OnlyIAS UDAAN PLUS: ECONOMY

• Nodal agencies for the scheme’s implementation are OPEN NETWORK FOR DIGITAL COMMERCE
Rural Electrification Corporation (REC) Limited and
In News: Recently, the The Union Minister of Commerce
Power Finance Corporation (PFC).
& Industry chaired a meeting for the review of the Open
• Special Category States: North-Eastern State of Network for Digital Commerce (ONDC) initiative of
Sikkim and States/Union Territories of Jammu & Department for Promotion of Industry and Internal Trade
Kashmir, Ladakh, Himachal Pradesh, Uttarakhand, (DPIIT).
Andaman & Nicobar Islands, and Lakshadweep will
be treated as Special Category States. ONDC:
• Open Network for Digital Commerce christened
Related Govt Schemes and Initiatives:
ONDC is globally first-of-its-kind initiative that aims
• Pradhan Mantri Sahaj Bijli Har Ghar Yojana to democratise Digital Commerce, moving it from a
(Saubhagya): To ensure electrification of all willing platform-centric model to an open-network.
households in the country in rural as well as urban
• As UPI is to the digital payment domain, ONDC is to e-
areas.
commerce in India.
• Deendayal Upadhyaya Gram Jyoti Yojana
• ONDC will enable, buyers and sellers to be digitally
(DDUGJY): The rural electrification scheme provides
visible and transact through an open network, no
for (a) separation of agriculture and non-agriculture
matter what platform/application they use.
feeders; (b) strengthening and augmentation of sub-
• ONDC will empower merchants and consumers by
transmission and distribution infrastructure in rural
breaking silos to form a single network to drive
areas including metering at distribution
innovation and scale, transforming all businesses
transformers, feeders and consumers end.
from retail goods, food to mobility.
• Ujwal Discom Assurance Yojana (UDAY): For
• Objectives:
operational and financial turnaround of Discoms.
o Promoting open networks developed on open-
• ‘4 Es’ in the Revised Tariff Policy: The 4Es include
sourced methodology, using open specifications
Electricity for all, Efficiency to ensure affordable
and open network protocols independent of any
tariffs, Environment for a sustainable future, Ease of
specific platform.
doing business to attract investments and ensure
o To digitize the entire value chain, standardize
financial viability.
operations, promote inclusion of suppliers,
derive efficiencies in logistics and enhance value
FREIGHT SMAR T CITIES INITIATIVE for consumers.
In News: Recently, the Logistics Division under the • Open-Source: Making a software or a process open-
Ministry of Commerce & Industry has released the source means that the code or the steps of that
roadmap for the ‘Freight Smart Cities Initiative’. process is made available freely for others to use,
redistribute and modify it.
About ‘Freight Smart Cities Initiative’: • Example:
• Stakeholders: The Ministry of Commerce & Industry o The operating system of Apple’s iPhones (iOS) is
has collaborated with Germany, Rocky Mountain closed source, meaning it cannot be legally
Institute (RMI) and RMI India to develop freight modified or reverse engineered,
smart cities. o Google’s Android operating system is open-
• Aims: to improve the efficiency of urban freight and source, and therefore it is possible by
create an opportunity for a reduction in logistics smartphone manufacturers such as Samsung,
costs. Xiaomi, OnePlus, etc to modify it for their
• Implementation: hardware.
o State Governments will identify ten cities,
initially, to be developed as Freight Smart Cities. E-Commerce
o In these ten cities, city-level logistics committees • Electronic commerce or e-commerce is a business
would be formed with having members from the model that lets firms and individuals buy and sell
government as well as from the private sector. things over the Internet.
o Committees would co-create City Logistics Plans • Propelled by rising smartphone penetration, the
like developing peri-urban freight centres, night- launch of 4G networks and increasing consumer
time deliveries, developing truck routes, wealth, the Indian e-commerce market is expected to
Promoting electrification of urban freight among grow to USD 200 billion by 2026.
others. • The Indian e-commerce industry has been on an
• Further expand: to 75 cities in the next phase before upward growth trajectory and is expected to surpass
scaling up throughout the country. It will include all the US to become the second-largest e-commerce
state capitals and cities that have more than one market in the world by 2034.
million population.
• Significance: Improving city logistics would also EXPERT COMMITTEE ON LONGEVITY FINANCE
enable efficient freight movement and bring down
• In News: Recently, International Financial Services
the logistics costs boosting all sectors of the economy.
Centres Authority (IFSCA) has constituted an Expert

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OnlyIAS UDAAN PLUS: ECONOMY

Committee to recommend approach towards • Vehicles that already carry a registration number
development of Longevity Finance Hub in GIFT IFSC would be allowed to retain it.
• Vintage cars that are registered afresh, such as those
About Longevity Finance Hub: that are imported into the country, would be assigned
• ‘Longevity Finance Hub’ will cater to the investment an identifier “VA” in the registration number.
and wealth management needs of the ‘silver • These vehicles will carry a registration plate
generation’ comprising individuals aged 60 years and displaying the state code in two letters followed by
older. VA for vintage, then a 2-letter series and finally a 4-
• Global estimates suggest that there are one billion digit series (0001 to 9999) allotted by the state
people in the silver generation. registering authority.
• Their combined spending power is worth $15 trillion • Registration information will be on the Parivahan
and the size is ever expanding. portal of the Ministry of Road Transport and
• Development in medicinal science and technology Highways.
will support extending lifespan and longevity of the • Fees: new registration - ₹20,000 and subsequent re-
silver generation. registration - ₹5,000.
• It is estimated that by 2040, there will be more • Sale and purchase of vehicles registered as vintage is
members of the silver generation than people under permissible; the buyer and seller have to inform their
20. respective State Transport Authorities.
• This demographic change will throw open new • Scrappage Policy: Vintage vehicles are insulated
challenges and opportunities especially in the areas from the scrappage policy. If a vehicle is more than 15
of wealth management, health, insurance, and other years old but within 50 years, the owner can continue
investment products, thus necessitating the to keep it by passing fitness tests every five years.
dedicated Longevity Finance Hub. • Use of Vintage Cars: Vintage vehicles would neither
be permitted on the road for regular purposes nor
Expert Committee on Longevity Finance Hub: would they be used for commercial purposes. They
• Chaired by: The expert committee is co-chaired by would be allowed only during exhibitions.
Ms. Kaku Nakhate, President and Country Head
(India), Bank of America, and Mr. Gopalan Srinivasan, PRADHAN MANTRI GRAM SADAK YOJANA
Ex-CMD, New India Assurance Company Limited.
In News: Recently, the Cabinet Committee on Economic
• Objective: The committee will recommend an
Affairs has approved continuation of Pradhan Mantri
approach towards the development of Longevity
Gram Sadak Yojana (PMGSY)-I and II up to September,
Finance Hub and provide a road map for the same.
2022, and Road Connectivity Project for Left Wing
Extremism Affected Areas up to March, 2023.
International Financial Services Centres Authority
(IFSCA)
About PMGSY:
• Established in 2020 under the International Financial
• Launched on: 25th December, 2000.
Services Centres Authority Act, 2019.
• Objective: To provide connectivity, by way of an all-
• Headquartered at GIFT City, Gandhinagar in Gujarat.
weather road to unconnected habitations.
• Unified authority for the development and regulation
• Eligibility: Unconnected habitations of designated
of financial products, financial services and financial
population size (500+ in plain areas and 250+ in
institutions.
North-Eastern States, Himalayan States, Deserts and
• The GIFT IFSC is the maiden international financial
Tribal Areas as per 2001 census) in the core network
services centre in India.
for uplifting the socio-economic condition of the rural
• Objective: to develop a strong global connect and population.
focus on the needs of the Indian economy as well as
• Funding: The Union Government bears 90% of the
to serve as an international financial platform for the
project cost in respect of projects sanctioned under
entire region and the global economy as a whole.
the scheme in North-Eastern and Himalayan States,
whereas for other states the Union Government bears
POLICY ON VINTAGE VEHICLES 60% of the cost.
• In News: Recently, the Ministry of Law has approved • Features:
the Draft Vintage Cars Policy. The policy seeks to o PMGSY promotes the use of new and green
amend the Central Motor Vehicle Rules,1989. The technology in the construction of rural roads.
rules will soon be notified by the Ministry of Road Locally available materials are used in road
Transport and Highways. construction in order to promote cost-effective
• Vintage Cars: All two- and four-wheelers that are and fast construction.
50+ years old and have been maintained in their o It also envisages a three-tier Quality Assurance
original form and which have not undergone any Mechanism to ensure the quality of road works
substantial overhaul, shall be defined as Vintage during construction and post-construction.
Motor Vehicles. • PMGSY – Phase I:
o PMGSY – Phase I was launched in December,
Registration of Vintage Cars: 2000 as a 100 % centrally sponsored scheme.
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OnlyIAS UDAAN PLUS: ECONOMY

o Under the scheme, 1,35,436 habitations were • Optimization: For the transportation of goods from
targeted for providing road connectivity and 3.68 one place to another, the plan will help in selecting
lakh km. for upgradation of existing rural roads the most optimum route in terms of time and cost.
in order to ensure full farm to market • Synchronization: PM GatiShakti will help in
connectivity. synchronizing the activities of each department in a
• PMGSY – Phase II: holistic manner by ensuring coordination of work
o The Government of India subsequently launched between them.
PMGSY-II in 2013 for upgradation of 50,000 Kms • Targets:
of existing rural road network to improve its o 11 industrial corridors and two new defence
overall efficiency. corridors in Tamil Nadu and Uttar Pradesh
o While the ongoing PMGSY – I continued, under o 4G connectivity in all villages
PMGSY phase II, the roads already built for o Increasing renewable energy capacity to 225 GW
village connectivity was to be upgraded to from 87.7 GW
enhance rural infrastructure. o Expanding the national highway network to 2
• PMGSY-Phase III: lakh km
o The government of India launched PMGSY-III in o Increasing length of transmission network to
2019 for consolidation of 1,25,000 Km road 4,54,200 circuit km
length by March 2025. o Creation of 220 new airports, heliports and water
aerodromes
Road Connectivity Project of Left Wing Extremism o Increasing cargo handling capacity of railways to
Affected Areas (RCPLWEA): 1,600 million tons from 1210 million tons
• RCPLWEA was started in 2016 to improve o Adding 17,000 km to gas pipeline network
connectivity in 44 Left Wing Extremism(LWE) o 202 fishing clusters/harbours/landing centres
affected districts in 9 states. and more
• The 9 states are Andhra Pradesh, Bihar, Chhattisgarh,
Jharkhand, Madhya Pradesh, Maharashtra, Odisha, National Infrastructure Pipeline:
Telangana and Uttar Pradesh. • NIP is a first-of-its-kind initiative to provide world-
• Bridges up to a span of 100 meters, critical from class infrastructure across the country and improve
security angle would also be funded on these roads. the quality of life for all citizens.
• It will improve project preparation, attract
GATI SHAKTI investments (both domestic & foreign) into
infrastructure, and will be crucial for attaining the
In News: Recently, the government of India has launched
target of becoming a $5 trillion economy by FY 2025.
the ambitious Rs 100 lakh crore Gati Shakti Master Plan
• Covers both economic and social infrastructure
to provide multi-modal connectivity to more than 1,200
projects.
industrial clusters.
Atanu Chakraborty Task Force Recommendations on
About Gati Shakti
National Infrastructure Pipeline (NIP):
• A digital platform will be created to bring 16
• Investment needed: ₹111 lakh crore over the next
ministries including rail and roadways together for
five years (2020-2025) to build infrastructure
integrated planning and coordinated implementation
projects and drive economic growth.
of infrastructure projects.
• Energy, roads, railways and urban projects are
• Aim: To ensure integrated planning and
estimated to account for the bulk of projects (around
implementation of infrastructure projects in the next
70%).
four years, with focus on expediting works on the
ground, saving costs and creating jobs. • The centre (39 percent) and state (40 percent) are
expected to have an almost equal share in
• Comprehensiveness: It will incorporate the
implementing the projects, while the private sector
existing infrastructure schemes of different
has 21 percent share.
departments and state governments like Bharatmala,
Sagarmala, inland waterways, UDAN etc. • Aggressive push towards asset sales.
• Analytical: It will offer 200 layers of geospatial data, • Monetisation of infrastructure assets.
including on existing infrastructure as well as • Setting up of development finance institutions.
geographic information about forests, rivers and • Strengthening the municipal bond market.
district boundaries.
• Dynamic: The portal will allow various government INDIA’S LARGEST FLOATING SOLAR PROJECT
departments to track the progress of various projects In News: Recently, the National Thermal Power
in real time and at one centralised place. Corporation (NTPC) has commissioned the largest
• Prioritization: Different Departments will be able to floating solar PV project of 25MW on the reservoir of its
prioritize their projects through cross–sectoral Simhadri thermal station in Visakhapatnam, Andhra
interactions. Pradesh.

Simhadri Floating Solar Project

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OnlyIAS UDAAN PLUS: ECONOMY

• The 2000MW coal-based Simhadri Station is the first equity-like products in export-oriented units, in both
power project to implement an open sea intake from manufacturing and services sectors.
the Bay of Bengal which has been functional for more • Objectives:
than 20 years. o To enhance India’s competitiveness in select
• This is the first solar project to be set up under the sectors through finance and extensive
flexibilization scheme of coal-powered plant, notified handholding support.
in 2018. o Identify and nurture companies having
• The floating solar installation which has a unique differentiated technology, products or processes,
anchoring design is spread over 75 acres in an RW and enhance their export business
reservoir. o To assist units with export potential, which are
• This floating solar project has the potential to unable to scale up their operations for want of
generate electricity from more than 1 lakh solar PV finance.
modules. o Identify and mitigate challenges faced by
• This would not only help to light around 7,000 successful companies which hinder their exports.
households but also ensure at least 46,000 tons of o To assist existing exporters in widening their
CO2e are kept at arm’s length every year during the basket of products and target new markets
lifespan of this project. through a strategic and structured export market
• The project is also expected to save 1,364 million development initiative.
litres of water per annum. This would be adequate to • Criteria for Selecting Companies:
meet the yearly water requirements of 6,700 o Companies will be selected for support based on
households. their unique value proposition in technology,
products or processes that match global
NTPC requirements.
• NTPC is an Indian statutory corporation engaged in o Fundamentally strong companies with
the generation of electricity and allied activities. acceptable financials with an annual turnover of
• Located in New Delhi. up to approx. Rs 500 crore.
• It is incorporated under the Companies Act 1956 and o Companies with a good business model, strong
it is a central Public Sector Undertaking (PSU) under management capabilities, and focus on product
the Ministry of Power. quality.
• It is India’s largest energy conglomerate with roots
planted way back in 1975 to accelerate power A greenshoe option is an over-allotment option, which is
development in India. a term that is commonly used to describe a special
arrangement in a share offering for example an IPO.
• Aims: to provide reliable power and related solutions
in an economical, efficient and environment-friendly
manner, driven by innovation and agility. Alternative Investment Fund:
• It became a Maharatna company in May 2010. • Anything alternative to traditional forms of
investments gets categorized as alternative
• NTPC’s core function is the generation and
investments.
distribution of electricity to State Electricity Boards
in India. • In India, AIFs are defined under Securities and
Exchange Board of India (Alternative Investment
• It is the largest power company in India with an
Funds) Regulations, 2012.
electric power generating capacity of 62,086 MW.
• It refers to any privately pooled investment fund,
• It has also ventured into oil and gas exploration and
(whether from Indian or foreign sources) which are
coal mining activities.
not presently covered by any governing fund
management of SEBI nor coming under the direct
UBHARTE SITAARE FUND regulation of any other sectoral regulators in India.
In News: Recently, the Ministry of Finance has launched • It includes venture Capital Fund, hedge funds, private
‘Ubharte Sitaare’ Alternative Investment Fund to facilitate equity funds, commodity funds, infrastructure funds,
debt and equity funding to export-oriented MSMEs (Micro etc.
Small and medium Enterprises).
NATIONAL MONETISATION PIPELINE
About the scheme
In News: Recently, the GoI launched the National
• Under the scheme, an identified company is
Monetisation pipeline (NMP) in an effort to list out the
supported even if it is currently underperforming or
government’s infrastructure assets to be sold over the
may be unable to tap its latent potential to grow.
next four-years.
• The scheme diagnoses such challenges and provides
support through a mix of structured support covering
About NMP
equity, debt and technical assistance.
• The four-year National Monetisation Pipeline (NMP)
• It will also have a Greenshoe Option of Rs 250 crore.
will unlock value in brownfield projects by engaging
• The fund has been set up jointly by Exim Bank and
the private sector, transferring to them the rights but
SIDBI (Small Industries Development Bank of India)
not the ownership in projects.
which will invest in the fund by way of equity and
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OnlyIAS UDAAN PLUS: ECONOMY

• Components: Roads, railways and power sector and international immersion in the next three
assets will comprise over 66 per cent of the total years.
estimated value of the assets to be monetised, with o An investment of up to ₹ 40 lakh to the start-up
the balance coming from sectors including telecom, based on the current valuation and growth stage
mining, aviation, ports, natural gas and petroleum of the Start-Up will be provided through selected
product pipelines, warehouses and stadiums. accelerators.
• Significance:
Objective: o India is currently the third-largest Unicorn hub
• To unlock the value of investments in brownfield globally, with 63 Unicorns having a total
public sector assets by tapping institutional and long- valuation of 168 Billion USD.
term capital, which can thereafter be leveraged for o It aims to further the Indian start-up growth and
public investments. create at least 100 unicorns out of the selected
• To enable ‘Infrastructure Creation through startups.
Monetisation’ wherein the public and private sector
collaborate, each excelling in their core areas of Government Initiatives:
competence, so as to deliver socio-economic growth. • Startup India Seed Fund Scheme (SISFS)
• Startup yatra (Initiative by Startup India Action Plan)
Top five sectors Covered: • Make in India Programme (Vocal for Local)
• Roads (27%): It includes 26,700 km of roads, • SOMA Programme (Promote deep tech startups)
railway stations, train operations and tracks
• Railways (25%) BHARAT SERIES (BH-SERIES)
• Power (15%): 28,608 CKT km worth of power
In News: Recently, the Ministry of Road Transport and
transmission lines, 6 GW of hydroelectric and solar
Highways has notified Bharat “BH” series of registration
power assets will be monetised.
to free vehicle owners from the hassle of relocating a
• Oil & gas pipelines (8%): 8,154 km of natural gas vehicle.
pipelines and 3,930 km of petroleum product
pipelines are up for the bid. Bharat series (BH-series)
• Telecom (6%): 2.86 lakh of km fibre assets and • There was a procedure of re-registration of a vehicle
14,917 towers in the telecom sector are being opened while moving to another state.
up for the private sector.
• A vehicle bearing BH registration mark shall not
require assignment of a new registration mark when
Note: Roads, railways and power sector assets will
the owner of the vehicle shifts from one State to
comprise over 2/3rd of the total estimated value of the
another.
assets to be monetised.
• Format of Bharat series (BH-series) Registration
Mark –
Greenfield vs Brownfield Investment
• Registration Mark Format:
• Greenfield Project: It refers to investment in a
o YY BH #### XX
manufacturing, office, or other physical company-
o YY – Year of first registration
related structure or group of structures in an area
o BH- Code for Bharat Series
where no previous facilities exist.
o ####- 0000 to 9999 (randomized)
• Brownfield investment: The projects which are
o XX- Alphabets (AA to ZZ)
modified or upgraded are called brownfield projects.
The term is used for purchasing or leasing existing
Eligibility
production facilities to launch a new production
• Anyone who is a government/PSU employee, state or
activity.
Centre
• In private sector, an employee of a company that has
SAMRIDH SCHEME offices in at least four states/UTs is eligible on
In News: Recently, the Ministry of Electronics & voluntary basis
Information Technology (MeitY) has launched the ‘Start-
up Accelerators of MeitY for pRoduct Innovation, System of tax payment
Development and Growth (SAMRIDH)’ programme. • The motor vehicle tax will be levied for 2 years or in
multiple of 2 instead of paying the 15 years’ tax
About the Scheme: upfront
• Aim: To create a conducive platform for Indian • After the completion of 14th year, the tax shall be
Software Product start-ups to enhance their products levied annually which shall be half of the amount
and secure investments for scaling their business. which was charged earlier
• Implementation: MeitY Start-up Hub (MSH).
• Features of the Scheme: Road tax
o Focus on accelerating the 300 start-ups by • Road tax will be charged at 8% if the cost of the
providing customer connect, investor connect, vehicle is below Rs 10 lakh
• It is 10% for those costing between Rs 10-20 lakh.
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OnlyIAS UDAAN PLUS: ECONOMY

• And for vehicles costing more than Rs 20 lakh, the tax o The scheme will run for 10 years and can be
is 12 per cent extended thereafter.
• Diesel vehicles will be charged 2% extra
• Electric vehicles shall be charged 2 per cent less tax UDAN Phases, Krishi UDAN And International UDAN:
• UDAN 1.0:
Benefits of BH Series o Under this phase, 5 airlines companies were
• Facilitate free movement of personal vehicles across awarded 128 flight routes to 70 airports
any state in India (including 36 newly made operational airports).
• Ease the ownership transfer of used vehicles • UDAN 2.0:
• Reduces the tax burden association with relocation o In 2018, the Ministry of Civil Aviation announced
• Hassle free online system promotes transparency in 73 underserved and unserved airports.
the procedure o For the first time, helipads were also connected
• Incentives to electric vehicles paves way towards under phase 2 of the UDAN scheme.
sustainable India • UDAN 3.0
o Inclusion of Tourism Routes under UDAN 3 in
coordination with the Ministry of Tourism.
UDAN SCHEME
o Inclusion of Seaplanes for connecting Water
In News: Recently, ahead of UDAN Day (21st October), Aerodromes.
the Ministry of Civil Aviation flagged off 6 routes, o Bringing in a number of routes in the North-East
expanding the aerial connectivity of North-East India, Region under the ambit of UDAN.
under the UDAN Scheme. • UDAN 4.0
o In 2020, 78 new routes were approved under the
About UDAN scheme (Ude Desh Ka Aam Nagrik) 4th round of RCS-UDAN to further enhance the
Scheme: connectivity to remote & regional areas of the
• The scheme is aimed at enhancing connectivity to country.
remote and regional areas of the country and making o Kavaratti, Agatti, and Minicoy islands of
air travel affordable. Lakshadweep will be connected by the new
• It is also known as the regional connectivity scheme routes of UDAN 4.0.
(RCS) as it seeks to improve air connectivity to tier-2 • UDAN 4.1
and tier-3 cities through revival of unused and o The UDAN 4.1 focuses on connecting smaller
underused airports. airports, along with special helicopter and
• Launch: Ude Desh Ka Aam Naagrik (UDAN) was seaplane routes.
launched as a Regional Connectivity Scheme (RCS) o Some new routes have been proposed under the
under the Ministry of Civil Aviation in 2016. Sagarmala Seaplane services.
• Objectives: o Sagarmala Seaplane Services is an ambitious
o To develop the regional aviation market. project under the Ministry of Ports, Shipping and
o To provide affordable, economically viable and Waterways with potential airline operators.
profitable air travel on regional routes to the • Krishi UDAN: It was launched by the Ministry of
common man even in small towns. Civil Aviation in August 2020, on international
• Features: and national routes to assist farmers in
o Nearly half of the seats in Udan flights are transporting agricultural products so that it
offered at subsidised fares, and the improves their value realisation.
participating carriers are provided a certain • International UDAN: Under International
amount of viability gap funding (VGF) – an UDAN, the plan is to connect India’s smaller cities
amount shared between the Centre and the directly to some key foreign destinations in the
concerned states. neighbourhood.
o Airlines are awarded routes under the
programme through a bidding process and are
KHAVDA RENEWABLE ENERGY PARK
required to offer airfares at the rate of ₹2,500 per
hour of flight. In News: Recently, India has planned to set up around 14
o At least 50% of the total seats on an aircraft gigawatt-hour (GWh) grid-scale battery storage systems
have to be offered at cheaper rates. at the Khavda renewable energy park in Gujarat.
o In order to enable airlines to offer affordable About Khavda Renewable Energy Park:
fares they are given a subsidy from the • Khavda Renewable Energy Park is the world’s largest
Government for a period of three years. renewable energy park in Gujarat’s Kutch.
o The Government had also earmarked ₹4,500 • The park will be built along the Indo-Pak border at
crore for revival of 50 airports in the first three Khavda.
years. • The park will generate 30GW of clean energy. It will
• Funding: be a hybrid renewable energy park, as it will produce
o Jointly funded by the central government and power using both solar energy and wind energy.
state governments.
Uses of Large Battery Storage systems:
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OnlyIAS UDAAN PLUS: ECONOMY

• Large battery storages can help keep power grids NATIONAL EXPORT INSURANCE ACCOUNT
stable, given electricity is produced intermittently SCHEME
from clean energy sources such as solar and wind.
In News: Recently, GoI approves continuation of the
• One of the most critical advantages of battery storage National Export Insurance Account (NEIA) scheme and
is the ability to store energy as it is generated and infusion of Rs. 1,650 crore Grant-in-Aid over 5 years.
then redistribute it when needed rather than as it is
produced. National Export Insurance Account (NEIA):
• This ability reduces the need to curtail renewable • It has been set up by the Government of India to
generation and allows the energy to be deployed facilitate medium and long-term exports, which are
during periods of high electricity demand. commercially viable, considering the limitations of
the ECGC Limited in providing adequate cover on its
NATIONAL SINGLE WIN DOW SYSTEM own and non-availability of reinsurance cover to such
• In News: Recently, the Union Minister of Commerce exporters.
and Industry has launched the National Single • Aims to ensure the availability of credit risk cover for
Window System (NSWS) for investors and projects and other high-value exports, which are
businesses. desirable from the point of view of national interest,
but which ECGC is unable to underwrite at terms
About National Single Window System (NSWS): which will not affect the competitiveness of the
• It is a one-stop digital platform that aims at exports.
allowing investors to apply for various pre-
operations approvals required for commencing a NEIA Trust
business in the country. • It was established in 2006 to promote project exports
• Aims: to make the business registration process from India that are of strategic and national
easier, allowing the beneficiary to get significant importance.
approvals online, without having to run to the • The NEIA Trust promotes Medium and Long Term
government offices for approvals and can avail (MLT) /project exports.
themselves of services with just a click. • It extends (partial/full) support to covers issued by
• Currently, the platform hosts approvals across 18 ECGC (ECGC Ltd, formerly known as Export Credit
Central Departments & 9 States. Another 14 Central Guarantee Corporation of India Ltd.) to MLT/project
depts & 5 states will be added by December 2021. export and to Exim Bank for Buyer’s Credit (BC-NEIA)
tied to project exports from India.
Services offered by NCWS:
• Know Your Approval (KYA) Service: It generates a Various Export Related Schemes and Initiatives taken
list of approvals that must be obtained before a by Govt:
business may begin operations. It does by asking the • Foreign Trade Policy (2015-20): extended upto 30-
investor a series of questions about their anticipated 09-2021 due to the COVID-19 pandemic situation.
business operations, and then determining which • Roll out of a new Scheme – Remission of Duties
permissions are required based on the answers. and Taxes and Exported Products (RoDTEP): Rs
• Common Registration Form: Unified information 12,454 crore sanctioned for the Scheme in the FY
capturing system and a universal registration form 2021-22. It is a WTO compatible mechanism for
has been intended to guarantee a single point of reimbursement of taxes/ duties/ levies, which are
submission of information and documents across currently not being refunded under any other
Ministries and States. mechanism, at the central, state and local level.
• State registration form: It allows investors to access • ROSCTL scheme: Support to the textiles sector was
the corresponding State Single Window System with increased by the remission of Central/ State taxes,
a single click. which now been extended till March 2024.
• Applicant dashboard: Provides a single online • Trade Infrastructure for Export Scheme (TIES),
interface to apply, track and respond to the queries Market Access Initiatives (MAI) Scheme and
pertaining to approvals and registrations across Transport and Marketing Assistance (TMA)
ministries and States. schemes to promote trade infrastructure and
• Document repository: An online centralized storage marketing.
service for investors to enable one-time document
submission and use the same across multiple NATIONAL ROAD SAFETY BOARD
approvals. This eliminates the need to submit In News: Recently, the Ministry of Road Transport &
documents at multiple portals. Highways has notified the constitution of the National
• E-Communication module: It enables online Road Safety Board.
response to queries and clarification requests related
to applications by Ministries and States. National Road Safety Board:
• The NRSB will be constituted of a panel of seven
members and a chairman, with the members having
experience in the fields related to road safety, traffic
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OnlyIAS UDAAN PLUS: ECONOMY

regulation, urban planning, civil engineering and o Billing and payment;

police enforcement and investigation. o Disconnection and reconnection;
• Additionally, the board will also comprise of technical o Reliability of supply;
committees to look into a variety of aspects of road o Consumer as ‘prosumer’;
safety from civil engineering to vehicle construction o Standards of performance of licensee;
and safety equipment. o Compensation mechanism;
• The Head Office of the Board shall be in the National o Call centre for consumer services;
Capital Region and the Board may establish offices at o Grievance redressal mechanism.
other places in India. • Key Provisions:
• The Board shall be responsible for promoting road o States will have to implement these rules and
safety, innovation and adoption of new technology discoms will be held more accountable for issues
and for regulating traffic and motor vehicles. like delays in providing and renewing
connections of electricity.
Board shall formulate: o They are also obligated to provide round-the-
• Specific standards for road safety, traffic clock electricity to consumers, as per the
management and road construction for hilly regions Ministry of Power.
• Guidelines for capacity building and development of o To ensure compliance, the government will apply
skills for traffic police, hospital authorities, highway penalties that will be credited to the consumer’s
authorities, educational and research organizations account.
and other organizations o There are certain exceptions to these rules,
• Guidelines for establishing and operating trauma especially where use for agricultural purposes is
facilities and para-medical facilities, for concerned.
consideration by the Central Government • Other Facts: Electricity is a Concurrent List (Seventh
• Provide technical advice and assistance to the Central Schedule) subject and the central government has the
Government, State Governments and local authorities authority and the power to make laws on it.
on road safety and traffic management
'MAHARATNA' STATUS TO POWER FINANCE
Protection of Samaritans: CORPORATION
• The board aims to promote Good Samaritans and In News: Recently, the government has accorded the
good practices in road safety and traffic 'Maharatna' status to state-owned Power Finance
management Corporation (PFC).
• Good Samaritans who rescue victims of serious road
accidents and rush them to a hospital within the About PFC Ltd.
golden hour will now be rewarded with ₹5,000. • Power Finance Corporation Ltd. (PFC) is an Indian
• They will also be eligible for a cash prize of ₹1 lakh financial institution under the ownership of Ministry
which will be given to 10 such Samaritans in a year. of Power.
• It has been felt that there is a need to motivate the • Established in 1986, it is the financial backbone of
general public through cash awards and certificates Indian Power Sector.
to help the road accident victims in emergency • PFC is the 8th highest profit making Central Public
situation and to boost their morale. Sector Enterprise (CPSE) as per the Department of
• The categories of accidents that will make one eligible Public Enterprises Survey for FY 2017–18.
for the award will include those that result in a major • It is India’s largest NBFC and also India’s largest
surgery or minimum three days of hospitalisation or infrastructure finance company.
brain and spinal cord injuries.
Central Public Sector Enterprises (CPSE):
THE DRAFT ELECTRICITY (RIGHTS OF • The CPSEs are run by the Government under the
CONSUMERS) AMENDMENT RULES, 2021 Department of Public Enterprises of Ministry of
In News: Recently, The Draft Electricity (Rights of Heavy Industries and Public Enterprises.
Consumers) Amendment Rules, 2021 were published on • The government grants the status of Navratna,
September 30, 2021. Miniratna and Maharatna to them based upon the
profit made by these CPSEs.
Electricity (Rights of Consumers) Rules, 2020: • The Maharatna category has been the most recent
• These rules serve to “empower” consumers with one since 2009, other two have been in function since
rights that would allow them to access continuous 1997.
supply of quality, reliable electricity.
• The following areas are covered under the rules: Criteria for different status:
o Rights of consumers and Obligations of • Maharatna:
Distribution licensees; o Having Navratna status.
o Release of new connection and modification in o Listed on Indian stock exchange with minimum
existing connection; prescribed public shareholding under SEBI
o Metering arrangement; regulations.
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OnlyIAS UDAAN PLUS: ECONOMY

o Average annual turnover of more than Rs. 25,000 • Related Initiatives:

crore, during the last 3 years. o Women Entrepreneurship Platform (WEP)
o Average annual net worth of more than Rs. o Venture Capital Scheme for Agri-Business
15,000 crore, during the last 3 years. Development
o Average annual net profit after tax of more than o Pradhan Mantri Mudra Yojana
Rs. 5,000 crore, during the last 3 years. o Generation Unlimited in India (YuWaah)
o Should have significant global o National Career Service
presence/international operations. o Prime Minister’s Employment Generation
• Navratna: Programme (PMEGP)
o A company must first be a Miniratna and have 4 o Pradhan Mantri Rojgar Protsahan Yojana
independent directors on its board before it can (PMRPY)
be made a Navratna. o Mahatma Gandhi National Rural Employment
o A score of 60 (out of 100), based on six Guarantee Scheme (MGNREGA)
parameters:
1. Net profit to net worth. COMMUNITY RESOURCE PERSONS-ENTERPRISE
2. Manpower cost to total cost of PROMOTION (CRP-EP)
production/services.
In News: Recently, around 102 Community Resource
3. Profit before depreciation, interest and taxes
Persons-Enterprise Promotion (CRP-EP) have been
to capital employed.
certified under the Start-up Village Entrepreneurship
4. Profit before interest and taxes to turnover.
Programme (SVEP).
5. Earnings per share.
6. Inter-sectoral performance.
Community Resource Persons-Enterprise Promotion
• Miniratna: The CPSEs which have made profits in the
(CRP-EP)
last three years continuously and have positive net
• CRP-EP provides Business Support Services in rural
worth are eligible to be considered for grant of
areas.
Miniratna status.
• The services provided by them include preparation of
business plans, training, and accessing loans from
Benefits of Maharatna Status:
Banks.
• This enable PFC to offer competitive financing for the
• Selected from the community where the program is
power sector, which will go a long way in making
being implemented, as they understand the local
available affordable & reliable ‘Power For All 24×7’.
context and their familiarity with the NRLM
• This will also impart enhanced powers to the PFC
ecosystem.
Board while taking financial decisions.
• They are also trained before they start working with
• It can make equity investments to undertake financial
the entrepreneurs.
joint ventures and wholly-owned subsidiaries and
undertake mergers and acquisitions in India and
Start-up Village Entrepreneurship Programme
abroad.
(SVEP)
• It can also structure and implement schemes relating
• SVEP is a sub-scheme of the Deendayal Antyodaya
to personnel and Human Resource Management and
Yojana-National Rural Livelihood Mission (DAY-
Training.
NRLM), Ministry of Rural Development and has been
• It can also enter into technology Joint Ventures or
implemented since 2016.
other strategic alliances among others.
• Partner: Entrepreneurship Development Institute of
India (EDII), Ahmedabad is the technical support
SAMBHAV AWARENESS PROGRAMME partner of SVEP.
In News: Recently, the Ministry of Micro, Small & Medium • EDII is an autonomous and not-for-profit institute,
Enterprises (MSME) has launched an e-National Level set up in 1983.
Awareness Programme SAMBHAV. • It is sponsored by apex financial institutions like the
IDBI Bank Ltd., IFCI Ltd., ICICI Bank Ltd. and the State
About SAMBHAV: Bank of India (SBI).
• It is a mass outreach programme under the Ministry • It has been assigned the task of setting up
of MSME in which students from different Entrepreneurship Development Centers in
colleges/ITIs from all parts of the country will be Cambodia, Myanmar, Vietnam, Uzbekistan, etc. by the
encouraged by 130 field offices of the Ministry to take Ministry of External Affairs.
up entrepreneurship. • It aims to:
• During the campaign the college students will be o Support the rural poor to come out of poverty.
made aware of the various schemes being o Support the people to set up enterprises and
implemented by the Ministry of MSME through provide support until the enterprises stabilise.
Audio/Video film presentations. o Providing self-employment opportunities with
• Objective: To promote engagement of the youth in financial assistance and training in business
promoting entrepreneurship, boost domestic management and soft skills.
manufacturing with a view to push economic growth.
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OnlyIAS UDAAN PLUS: ECONOMY

o Create local community cadres for promotion of o Minor Violations: Penalty of only fine for such
enterprises. violations prescribed.
• Features: o Violation of some rules has been decriminalized.
o It addresses three major pillars of rural start-ups
namely finances, incubation and skill Mining Sector in India:
ecosystems. • India holds an advantage in production and
o It promotes both individual and group conversion costs in steel and alumina.
enterprises, majorly in manufacturing, trading • India is the world's second-largest coal producer
and service sectors. as of 2021.
o It invests on building the capacities of the • India is the world's second-largest crude steel
entrepreneurs to run the businesses profitably producer, as of 2020.
based on the local demand and ecosystem. • India has the same mineral potential as South Africa
o Investments are also made on the use of the and Australia. It produces 95 types of minerals but
Information and Communication Technology despite this huge mineral potential, the mining sector
(ICT) to create standard E-learning modules for of India still remains underexplored.
minimizing the transmission loss in technical • The mining sector contributes around 7 to 7.5% of
aspects like a business plan and profit and loss the GDP of countries like South Africa and Australia
account preparations. whereas it is only 1.75% in India.
• 11 states account for 90% of the total number of
MINERALS CONCESSION (FOURTH AMENDMENT) operational mines (Andhra Pradesh, Odisha,
RULES, 2021 Chhattisgarh, Jharkhand, West Bengal, Maharashtra,
In News: Recently, the Ministry of Mines has notified the Tamil Nadu, Gujarat, Madhya Pradesh, Rajasthan, and
Minerals (other than Atomic and Hydro Carbons Energy Karnataka).
Mineral) Concession (Fourth Amendment) Rules, 2021. It
will amend the Minerals (other than Atomic and Hydro Constitutional and Legal Provision Related to
Carbons Energy Mineral) Concession Rules, 2016 [MCR, Mining:
2016]. • State List: The entry at serial No. 23 of List II to the
Constitution of India mandates the state government
Objectives: to own the minerals located within their boundaries.
• Increasing employment and investment in the mining • Central List: The entry at serial No. 54 of List I
sector mandates the central government to own the
• Increase revenue to the States minerals within the Exclusive Economic Zone of India
• Increase the production and time bound (EEZ).
operationalisation of mines • The central government has the ownership over
• Increase the pace of exploration and auction of all offshore minerals (ie, minerals extracted from the
mineral resources, etc. sea or ocean floor in the Indian maritime zones such
as the territorial waters, continental shelf and
Provisions of the Minerals Concession (Fourth exclusive economic zones).
Amendment) Rules, 2021:
• Allows Part Surrender of Mines: The rules have Related Schemes:
allowed part surrender of mining lease area allowed • The National Mineral Policy 2019.
in all cases.Presently, part surrender was allowed • Rationalisation of taxes in the mining sector is also
only in case of non-grant of forest clearance. being considered.
• Sale of minerals by captive owners: In any lease, • Atmanirbhar Bharat scheme: enhancing private
where the mineral is required to be used for captive investments in the mineral sector and bringing in
purpose, the lessee may sell up to 50% of total other reforms has been announced.
mineral produced in such captive mines in a financial • District Mineral Foundation Funds.
year.
• Disposal of Mineral: The rules have added a USOF SCHEME
provision allowing disposal of overburden/ waste In News: Recently, The Union Cabinet has approved the
rock/ mineral below the threshold value which is provisioning of mobile services in over 7,000 uncovered
generated during the course of mining. villages through the Universal Service Obligation Fund
• Penalty provisions in the rules have been (USOF).
rationalized: Previously, the rules provided for
penalty of imprisonment upto 2 years or fine upto 5 About USOF Scheme:
lakh rupees or both for violation of each and every • It envisages to provide 4G based mobile services in
rule irrespective of the severity of the violation. the 7,287 uncovered villages of 44 Aspirational
• Category of Violations: Districts across five States - Andhra Pradesh,
o Major Violations: Penalty of imprisonment, fine Chhattisgarh, Jharkhand, Maharashtra, and Odisha.
or both. • Funded by the Universal Service Obligation Fund
(USOF).
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OnlyIAS UDAAN PLUS: ECONOMY

• Enhance digital connectivity useful for self-reliance, in shale oil production in the US having played a key
facilitate learning, dissemination of information and role in turning the country from an importer of crude
knowledge, skill upgradation and development, to a net exporter in 2019.
disaster management, e-Governance initiatives, • Associated Concerns:
establishment of enterprises & e-commerce facilities, o Shale oil and gas exploration faces several
etc. challenges other than environmental concerns
• It seeks to fulfill the vision of Digital India promoting around massive water requirements for fracking
domestic manufacturing and fulfilling the objectives and potential for groundwater contamination.
of Atmanirbhar Bharat etc. o Shale rocks are usually found adjacent to rocks
containing usable/ drinking water known as
Universal Service Obligation Fund (USOF): ‘aquifers
• It ensures that there is universal non- o While fracking, the shale fluid could possibly
discriminatory access to quality ICT (Information penetrate aquifers leading to methane poisoning
and Communications Technology) services at of groundwater used for drinking and irrigation
economically efficient prices to people in rural and purposes.
remote areas.
• Created under the Ministry of Communications in Shale Oil Exploration in India:
2002. • Currently, there is no large-scale commercial
• Non-lapsable fund, i.e., the unspent amount under a production of shale oil and gas in India.
targeted financial year does not lapse and is accrued • Earlier, State-owned ONGC had found prospects of
for next years’ spending. shale oil at the Cambay basin in Gujarat and the
• All credits to this fund require parliamentary Krishna Godavari basin in Andhra Pradesh.
approval and it has statutory support under Indian • However, the company concluded that the quantity of
Telegraph (Amendment) Act, 2003. oil flow observed in these basins did not indicate
• Objectives: “commerciality” and that the general characteristics
o Economic: Network extension & stimulate of Indian shales are quite different from North
uptake of the ICT services American ones.
o Social: Mainstreaming the underserved & un- • Conventional Sources:
served areas/groups by bridging the Access Gap. o The energy sources which cannot be
o Political: to enable citizens exercise their compensated, once these are used (after their
political rights in an informed way and exploitation) are termed as conventional energy
o Constitutional: Equitable distribution of the sources.
fruits of the telecom/digital revolution and fair o These sources of energy are also known as non-
allocation of national resources (pooled USO renewable sources of energy and in limited
levy) via targeted subsidies. quantities apart from hydro-electric power.
Some of the examples are coal, Natural gas, oil
TIGHT OIL etc.
• Non-Conventional Sources:
In News: Recenty, Cairn Oil & Gas has announced that it o These non-conventional sources are also known
is partnering with US-based Halliburton to start shale
as renewable sources of energy.
exploration in the Lower Barmer Hill formation, Western o The examples include solar energy, tidal energy
Rajasthan. and wind energy, Geothermal energy etc.
Shale Oil and Gas:
• Tight Oil: The key difference between shale oil and O-SMART SCHEME
conventional crude is that the former, also called In News: Recently, the Ministry of Earth Sciences (MoES)
‘tight oil’, is found in smaller batches, and deeper than has launched O-SMART (Ocean Services, Modelling,
conventional crude deposits. Applications, Resources and Technology) scheme.
• Shale Gas: Unlike conventional hydrocarbons that
can be extracted from the permeable rocks easily, About the scheme
shale gas is trapped under low permeable rocks. • The scheme encompasses a total of 16 sub-projects
• Extraction Process: addressing ocean development activities such as
o Extraction requires creation of fractures in oil Services, Technology, Resources, Observations and
and gas rich shale to release hydrocarbons Science.
through a process called hydraulic • The services rendered under the O-SMART will
fracking/fracturing. provide economic benefits to a number of user
o It requires a mixture of ‘pressurised water, communities in the coastal and ocean sectors,
chemicals, and sand’ (shale fluid) to break low namely, fisheries, offshore industry, coastal states,
permeable rocks and have access to the shale gas Defence, Shipping, Ports etc.
reserves.
• Top Producers: Russia and the US are among the Objectives:
largest shale oil producers in the world, with a surge
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OnlyIAS UDAAN PLUS: ECONOMY

• To generate and regularly update information on • Implemented by: Tourism and Hospitality Sector
Marine Living Resources and their relationship with Skill Council(THSSC) and training partners of
the physical environment in the Indian Exclusive National Skill Development Corporation(NSDC).
Economic Zone (EEZ). • Training under the programme: Under the
• To periodically monitor levels of sea water pollutants initiative, the Street Food Vendors will be educated
for health assessment of coastal waters of India, to on health and safety standards, safety provisions
develop shoreline change maps for assessment of under COVID-19 protocols, effective communication
coastal erosion due to natural and anthropogenic techniques with staff and customers, new-age skills
activities. such as digital literacy, financial literacy, digital
• To develop a wide range of the state-of-the art ocean payments and e-selling.
observation systems for acquisition of real-time data • Funding/Financial Support: The vendors will also
from the seas around India. be supported with loans under the Mudra Scheme.
• To generate and disseminate a suite of user-oriented
ocean information, advisories, warnings, data and Other Schemes related to Food vendors:
data products for the benefit of society. • PM SVANidhi Scheme
• To develop high resolution models for ocean forecast • Main Bhi Digital (me too digital)
and reanalysis system. • The Street Vendors (Protection of Livelihood and
• To develop algorithms for validation of satellite data Regulation of Street Vending) Act, 2014.
for coastal research and to monitor changes in the • Pradhan Mantri Shram Yogi Maandhan Yojana.
coastal research. • Pradhan Mantri Matru Vandana Yojana.
• Acquisition of 2 Coastal Research Vessels (CRVs) as
replacement of 2 old CRVs for coastal pollution Pradhan Mantri Kaushal Vikas Yojana:
monitoring, testing of various underwater • PMKVY was launched in 2015 under Skill India
components and technology demonstration. Mission.
• To develop technologies to tap the marine bio • It aims to train over 40 crore people in India in
resources, to develop technologies generating different skills by 2022.
freshwater and energy from ocean, to develop • It aims at vocational training and certification of
underwater vehicles and technologies and Indian youth for a better livelihood and respect in the
Establishment of Ballast water treatment facility etc. society.
• Submission of India's claim over continental shelf
extending beyond the EEZ supported by scientific PMKVY-1.0:
data, and the topographic survey of EEZ of India. • Launched on 15th July, 2015 (World Youth Skills
Day) to encourage and promote skill development in
Blue Economy: the country by providing free short duration skill
• The Blue Economy is concept that encourages better training, Special Projects, Recognition of Prior
stewardship of our ocean or ‘blue’ resources. Learning, Kaushal & Rozgar Mela, etc.
• The blue economy is not just about market
opportunities; it also provides for the protection and PMKVY 2.0 (2016-20):
development of more intangible ‘blue’ resources such • Launched by scaling up both in terms of Sector and
as traditional ways of life, carbon sequestration, and Geography and by greater alignment with other
coastal resilience to help vulnerable states mitigate missions of the Government of India like Make in
the often-devastating effects of climate change. India, Digital India, Swachh Bharat, etc.
• More than 1.2 Crore youth have been
PROGRAMME TO UPSKILL STREET VENDORS trained/oriented through an improved standardized
In News: Recently, the Ministry of Skill Development and skilling ecosystem in the country under PMKVY 1.0
Entrepreneurship(MSDE) has launched a programme to and PMKVY 2.0.
upskill street vendors.
PMKVY 3.0:
About the programme: • Launched in January 2021, in 717 districts, 28
• The programme will be implemented under the States/eight UTs, as a step towards ‘Atma Nirbhar
Recognition of Prior Learning (RPL) component of Bharat’.
Pradhan Mantri Kaushal Vikas Yojana (PMKVY) 3.0. • It envisages training of eight lakh candidates over a
• Objective: To provide relevant skills to the Street scheme period of 2020-2021 with an outlay of Rs.
Food Vendors leading towards better services to 948.90 crore.
consumers, more opportunities to vendors for • The focus is on bridging the demand-supply gap by
revenue generation, awareness on regulations and promoting skill development in areas of new-age and
stipulated rules in return providing better services to Industry 4.0 job roles.
the local bodies.
• Pilot Phase: In the pilot phase, the programme will SMART CITIES MISSION
be implemented to skill the street vendors of East In News: Recently, the Union Housing and Urban Affairs
Delhi Municipal Corporation(EDMC). Ministry has extended the timeline for the
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OnlyIAS UDAAN PLUS: ECONOMY

implementation of the Smart Cities Mission to June 2023 ‘All India EdTech Challenge and Master Class Series’ for
due to the Covid pandemic. early and advanced stage EdTech founders.

About Smart Cities Mission (SCM) About All India EdTech Challenge and Master Class
• It is a Centrally Sponsored Scheme launched in 2015. Series Initiative:
• It will cover 100 cities and is being implemented by • Aim: To nurture EdTech companies and startups who
the Ministry of Urban Development (MoUD) and all are in pre and post-minimum viable product (MVP)
state and union territory (UT) governments. stages.
• It initially aimed to be completed by 2019-20 but has • Features: The initiative will help EdTech identify
since been extended. industry gaps and clearly define clear problem
statements in the last mile; conduct focussed sessions
Objective: on product-market fit, go-to-market strategy,
• To promote cities that provide core infrastructure customer discovery, Master Class series to provide
and give a decent quality of life to their citizens, a them exposure to business fundamentals, and more.
clean and sustainable environment and application of • Eligibility: The challenge is open for Indian Edtech
‘Smart’ Solutions. startups having a unique combination of talent, ideas,
• Make Cities liveable, inclusive, sustainable (Area- creativity, competitiveness, perseverance, and
based development). passion.
• Create employment opportunities. • Tracks: The challenge will have two tracks-
• Four pillars: Social Infrastructure, Physical 1. Pre EdTech MVP startup challenge for existing
Infrastructure, Institutional Infrastructure, Economic and aspiring EdTech entrepreneurs.
Infrastructure. 2. Post EdTech MVP Challenge will be aimed to
• Significance: bring existing EdTech entrepreneurs closer to
o India is the world’s second-most populous universities, schools, venture capital firms, and
nation. policymakers and enable funding opportunities.
o 31% of India's present population and contribute
around 63% of GDP (Census 2011). NEAT INITIATIVE
o Urban areas are anticipated to house 40% of In News: Recently, the Ministry of Human Resource
India's people and contribute around 75% of Development (MHRD) recently announced the formation
India's GDP by the year 2030. of a new National Educational Alliance for Technology
(NEAT 3.0) to use technology to improve learning
Government Initiatives to Support the SCM: outcomes in higher education.
• National Urban Digital Mission (NUDM): It will
create a shared digital infrastructure for urban India. NEAT scheme:
It shall work across the three pillars of people, • The Model is based upon the Public-Private
process, and platform to provide complete support to Partnership model between the government and
cities and towns. India's Education Technology (Ed-Tech) companies.
• National Urban Learning Platform (NULP): It aims • Objective: to bring the best technological solutions in
to propagate solutions and innovations that are the education pedagogy to a single platform for the
underway, and act as an enabler of the rapid benefit of economically and socially weaker sections
development of diverse new solutions developed by of society.
cities and states. • Target Areas: Artificial Intelligence-based
• Ease of Living Index (EoLI): The EoLI is an technology solutions for customized learning or e-
assessment tool by the Ministry of Housing & Urban content in niche areas with highly employable skills
Affairs that evaluates the quality of life and the impact are being identified for showcasing on the portal.
of various initiatives for urban development in the • Modus Operandi: The government intends to
city. distribute free coupons for a variety of courses
• India Smart Cities Awards Contest (ISAC): It was offered by ed-tech companies under this scheme.
launched to reward the cities, projects and innovative • All India Council for Technical Education (AICTE) is
ideas promoting 'smart; development in cities. in charge of implementation.
• The Urban Learning Internship Programme
(TULIP): TULIP is a program for providing fresh Ed-tech:
graduates with experiential learning opportunities in • Ed-Tech is the practice of incorporating IT tools into
the urban sector. the classroom in order to provide a more engaging,
inclusive, and individualized learning experience.
ALL INDIA EDTECH CHALLENGE AND MA STER • Ed-Tech benefits:
CLASS SERIES INITIATIVE o Increasing the personalization of education
In News: Recently, Atal Innovation Mission (AIM), o Increasing educational productivity via
Amazon Web Services(AWS) and the Global EdTech increasing learning rates
Accelerator -UIncept have joined hands to organise the o Scale-up cost-cutting for instructional materials
and service delivery
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OnlyIAS UDAAN PLUS: ECONOMY

o Improved use of teacher/instructor time. India’s Status at Energy Conservation:

• At the COP-26 summit in Glasgow, India announced
Examples of grassroots innovation: its plans to increase non-fossil fuel power generation
• Hamara Vidhyalaya in Namsai district, Arunachal capacity to 500 GW by 2030. India is running what
Pradesh, is fostering tech-based performance will become the world’s largest clean energy
assessments programme, with an aim of having 175 GW of clean
• Assam’s online career guidance portal is energy capacity by 2022.
strengthening school-to-work and higher-education • India’s non-fossil fuel-based capacity has met the
transition for students in grades 9 to 12 40% target under its Nationally Determined
• Samarth in Gujarat is facilitating the online Contribution (NDC) at COP 21.
professional development of lakhs of teachers in • Installed power capacity from non-fossil fuels will go
collaboration with IIM-Ahmedabad up to 66% by 2030. Also, India has already reached
• Jharkhand’s DigiSATH is spearheading behaviour an emission reduction of 28%.
change by establishing stronger parent-teacher-
student linkages Initiatives Related to Energy Conservation:
• Himachal Pradesh’s HarGhar Pathshala is • Perform Achieve and Trade Scheme:
providing digital education for children with special • National Action Plan on Climate Change (NAPCC).
needs; Uttarakhand’s community radio is promoting • Standards and Labelling.
early reading through byte-size broadcasts • Energy Conservation Building Code (ECBC).
• Madhya Pradesh’s DigiLEP is delivering content for • Demand Side Management.
learning enhancement through a well-structured • ECO Niwas Samhita 2018.
mechanism with over 50,000 WhatsApp groups • Bharat Stage-IV (BS-IV) to Bharat Stage-VI (BS-VI).
covering all clusters and secondary schools • UJALA scheme.
• Kerala’s Aksharavriksham initiative is focusing on • International Solar Alliance.
digital “edutainment” to support learning and skill • The National Action Plan on Climate Change (NAPCC).
development via games and activities.
Bureau of Energy Efficiency
Government Initiatives: • The BEE is a statutory body established through the
• Swayam Prabha TV channel Energy Conservation Act, 2001 under the Union
• PM eVidya Ministry of Power.
• SWAYAMportal • It assists in developing policies and strategies with
• Digital Infrastructure for Knowledge Sharing the primary objective of reducing the energy
(DIKSHA). intensity of the Indian economy.
• BEE coordinates with designated consumers,
CERTIFICATION COURSE ON HOME ENERGY designated agencies, and other organisations to
AUDIT identify and utilise the existing resources and
In News: Recently, The Bureau of Energy Efficiency (BEE) infrastructure, in performing its functions.
has launched a ‘Certification Course on Home Energy
Audit (HEA)’. GRAM UJALA PROGRAMME
In News: Recently, Convergence Energy Services Limited
About Home Energy Audit (HEA) (CESL), a wholly owned subsidiary of Energy Efficiency
• A Home Energy Audit(HEA) enables appropriate Services Limited (EESL), has achieved a remarkable
accounting, monitoring and analysis of energy use of milestone of distributing 50 lakhs LED bulbs under
various energy-consuming equipment and Project Crore of their Gram Ujala programme.
appliances in a house.
• Based on this assessment, a technical report is given About the Gram Ujala Programme:
with feasible solutions for improving energy • The bulbs are offered by Convergence Energy
efficiency. Services Ltd (CESL), a wholly-owned subsidiary of
• The audit would ultimately lead to a reduction in Energy Efficiency Services Ltd (EESL).
energy bills and the carbon footprint of the consumer. • CESL is providing high quality 7-Watt and 12-Watt
LED bulbs with 3 years guarantee at a cost of INR 10
Objective: per bulb in exchange of working incandescent bulbs.
• Creation of a pool of professionals to perform home • Every household can exchange a maximum of 5 bulbs.
energy audits based on the needs of the consumers, • Coverage: In rural households in Bihar, Uttar
• Domestic consumers to get Home Energy Audit Pradesh, Andhra Pradesh, Karnataka, and Telangana.
carried out through respective State Designated • Objective: To ensure holistic development of the
Agency (SDA) Certified Home Energy Auditors, rural ecosystem.
• Create awareness on the importance and benefits of
energy audit and energy efficiency and conservation Unnat Jyoti by Affordable Lighting for All (UJALA)
among students from engineering/diploma colleges. Scheme:

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OnlyIAS UDAAN PLUS: ECONOMY

• It is a zero-subsidy scheme launched in 2015. • Launched by: North Eastern Development Finance
• It is also known as the LED-based Domestic Efficient Corporation Ltd. (NEDFi).
Lighting Programme (DELP) and is the world’s • Aim: To develop the artisans of the North Eastern
largest domestic lighting project. Region by providing them financial assistance in the
• Aim: To promote the efficient usage of energy for all form of term loans for income-generating activities
i.e., its consumption, savings and lighting. like setting up / expansion/modernization and other
• Eligibility: Every domestic household having a activities related to the sector.
metered connection can get LED bulbs.
Key Features:
About CESL: • Under the scheme, a total of 17 artisans have already
• Convergence Energy Services Limited (CESL) is a been provided with credit assistance of Rs.1 lakh per
subsidiary of state-owned Energy Efficiency artisan.
Services Limited, a joint venture of public sector • The credit facility is collateral-free and carries a
companies under the Ministry of Power, Government subsidized interest rate of 6% p.a., which is repayable
of India. in 24 months.
• CESL is focused on delivering clean, affordable, and • For regular repayment, an incentive of 1% on the
reliable energy. interest rate is provided, which will be refunded to
the artisans on successful repayment of loans.
ULIP HACKATHON – LOGIXTICS • Eligibility Criteria:
o Registered/ unregistered artisan/ Individual
In News: Recently, the Department for Promotion of o Having valid qualifications or practising any art
Industry and Internal Trade(DPIIT) has launched the form
Unified Logistics Interface Platform’s (ULIP) Hackathon o No existing loan from any other bank/ financial
named ‘LogiXtics’. institution
o Bank Account.
About ULIP Hackathon – LogiXtics
• It is a hackathon organized under the ULIP. NEDFi
• The hackathon will be a competitive event where • It is notified as a Public Financial Institution under
everyone is invited to showcase their strategic, Companies Act,1956 and was registered as an NBFC
coding and domain skills on a national-level platform in 2002 with RBI.
to solve the existing logistics industry issues. • Nodal Ministry: Ministry of Development of North
• Organise by: NITI Aayog and Atal Innovation Mission Eastern Region (DoNER),
and supported by National Industrial Corridor • Objective: To provide financial assistance to micro,
Development Corporation (NICDC) and NICDC small, medium and large enterprises for setting up
Logistics Data Bank Services Limited (NLDSL). industrial, infrastructure and agri-allied projects in
• Significance: India incurs one of the highest logistics the North Eastern Region of India and also
costs as a percentage of GDP in comparison to Microfinance through MFI/NGOs.
developed countries like the U.S. and Germany – • Headquarters: Guwahati, Assam.
where it is only 8% to 9% while it is 14% in India.

Unified Logistics Interface Platform (ULIP) PERFORM, ACHIEVE AND TRADE (PAT) SCHEME
• ULIP is being developed as a technology platform In News: Recently, a report released by the Centre for
in the logistics sector. Science and Environment (CSE) mentions that the
• Aims to enhance efficiency and reduce logistics Perform, Achieve and Trade (PAT) scheme introduced in
costs in India by creating a transparent platform that 2008 is not effective.
can provide real-time information to all stakeholders
and remove all asymmetry of information. About PAT Scheme
• The platform will also converge the visibility of multi- • Launched by: Ministry of Power.
modal transport across the existing systems of • Nodal Agency: It is a flagship program of Bureau of
various Ministries/Departments working in silos. Energy Efficiency under the National Mission for
• Moreover, the platform will also work with top Indian Enhanced Energy Efficiency (NMEEE).
technology organizations from the private sector and • Aim: PAT is a market-based compliance mechanism
identify solutions to reduce logistics costs. that aims to accelerate improvements in energy
efficiency in energy-intensive industries.
ATMANIRBHAR HASTSHILPKAR SCHEME • Features:
o It seeks to enhance cost-effectiveness through
In News: Recently, North Eastern Development Finance certification of excess energy savings in energy-
Corporation Ltd. (NEDFi) has launched Atmanirbhar intensive industries.
Hastshilpkar Scheme for the grass root artisans in the o An Energy Audit is done to verify the baseline
North East Region. data (current level of efficiency) and thereafter
energy saving targets are given.
About Atmanirbhar Hastshilpkar Scheme:

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OnlyIAS UDAAN PLUS: ECONOMY

o Energy Saving Certificates (esCerts) are issued to • HELP:

those plants that have achieved excess energy o Revenue Sharing Contract
savings over their targets. o Profit or loss is not a concern of the Government.
o Units that are unable to meet the targets either Hence less Red tape is there.
through their own actions or through the o Single Uniform License
purchase of escerts are liable to financial penalty
under the Energy Conservation Act, 2001. • NELP:
• Significance: It has led to the total energy savings of o Production Sharing Contracts: Based on Profit
more than 14 million tonnes of oil equivalent (MTOE) Sharing.
which has resulted in mitigation of about 66 million o Red tapism as the Government wanted to
tonnes of CO2 emission. calculate the input cost of explorers and
extractors.
Centre for Science and Environment (CSE): o Different Licences
• CSE is a public interest research and advocacy
organisation based in New Delhi. NATIONAL TECHNICAL TEXTILES MISSION
• It researches into, lobbies for and communicates the
In News: Recently, The Ministry of Textiles cleared 20
urgency of development that is both sustainable and
strategic research projects worth INR 30 crores in the
equitable.
areas of Specialty fibres and Geotextiles under the
Flagship Programme ‘National Technical Textiles
OPEN ACREAGE LICENSING POLICY Mission’.
In News: Recently, the Government launched the Open
Acreage Licensing Programme (OALP)Bid Round-VII for About National Technical Textiles Mission:
International Competitive Bidding in continuation of its • Launched by: The Ministry of Textiles.
aggressive programme for exploration and adhering to • Aim: To position the country as a global leader in
the prescribed timelines. Technical Textiles and improve the penetration level
of technical textiles in the country.
About OALP • Implementation Period: FY 2020-21 to 2023-24.
• Launched under the Hydrocarbon Exploration • Outlay: Rs. 1480 crores.
and Licensing Policy (HELP) in 2017. • Four components of the mission:
• Under OALP, companies are allowed to carve out 1. Research, Innovation and Development
areas they want to explore oil and gas in. 2. Promotion and Market Development
• Companies can put in an expression of interest (EOI) 3. Export Promotion
for any area throughout the year but such interests 4. Education, Training, Skill Development
are accumulated thrice in a year. The areas sought are • Focus: Developing the usage of technical textiles in
then offered for bidding. various flagship missions, programmes of the
• It provides uniform licences for exploration and country including strategic sectors.
production of all forms of hydrocarbons, enabling • Significance: This will reduce India’s import
contractors to explore conventional as well as dependence and promote the domestic
unconventional oil and gas resources. manufacturing of capital goods in the sector.
• Fields are offered under a revenue-sharing model
and throw up marketing and pricing freedom for Technical Textiles
crude oil and natural gas produced. • Technical textiles are defined as textile materials
and products manufactured primarily for their
Hydrocarbon Exploration and Licensing Policy technical performance and functional properties
(HELP): rather than aesthetic and decorative
• HELP was brought in March 2016 replacing the characteristics.
erstwhile New Exploration Licensing Policy (NELP) • Depending upon their application areas, Technical
• It had 2 key drivers: Textiles products are divided into 12 broad
1. The Open Acreage Licensing Programme (OALP) categories: Agrotech, Buildtech, Clothtech, Geotech,
2. The National Data Repository (NDR) Hometech, Indutech, Mobiltech, Meditech, Protech,
• Both were launched in June 2017 Sportstech, Oekotech, Packtech.
• Aim: To accelerate the Exploration and Production
(E&P) activities in India. DESIGN LINKED INCENTIVE FOR
• The main features of HELP: SEMICONDUCTORS
o Revenue sharing contract. In News: Recently, the Ministry of Electronics and
o Single, uniform licence for exploration and Information (MeitY) started seeking applications from
production of all hydrocarbon resources. 100 domestic companies, start-ups and MSMEs under its
o Choice with bidder to carve acreage. Design Linked Incentive (DLI) Scheme.
o Marketing & pricing freedom.
DLI scheme
HELP vis-à-vis NELP:
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OnlyIAS UDAAN PLUS: ECONOMY

• It was announced in December 2021 by MeitY. o To train 85,000 qualified engineers in the area of
• Under this, financial incentives and design Very-Large-Scale Integration (VLSI) and
infrastructure support will be extended to domestic Embedded System Design.
companies, startups and MSMEs across various o To develop 175 ASICs (Application Specific
stages of development and deployment of Integrated Circuits), Working Prototypes of 20
semiconductor design for Integrated Circuits (ICs), System on Chips (SOC) and IP Core repository
Chipsets, System on Chips (SoCs), Systems & IP Cores over a period of 5 years.
and semiconductor linked design for over 5 years. • Participating Institutions:
• Aims: o The programme would be implemented at about
o To create a vibrant ecosystem for Semiconductor 100 academic institutions/R&D organisations
Chip Design in the country. across the Country (including iits, nits,
o To promote the domestic manufacturing of Government/Private Colleges and R&D
semiconductors and allied devices. Organisations).
o To provide a globally competitive incentive o Startups and msmes can also participate in the
package to companies in semiconductors and programme by submitting their proposals under
display manufacturing as well as design. Academia- Industry Collaborative Project, Grand
• Nodal Agency for Implementation: Centre for Challenge /Hackathons/RFP.
Development of Advanced Computing (CDAC), a • Nodal Implementing Agency: C-DAC (Centre for
scientific society operating under MeitY. Development of Advanced Computing).
• Project Categorization: on the basis of institutions’
Components of DLI: expertise, technology readiness level (TRL) and
1. Chip Design Infrastructure Support: C-DAC will set design experience:
up the India Chip Centre to host the state-of-the-art o Design and development of
design infrastructure (viz. EDA Tools, IP Cores and SoCs/systems/ASICs/Reusable IP Core(s)
support for MPW (Multi Project Wafer fabrication) & o Development of application-oriented working
post-silicon validation) and facilitate its access to prototype of IPs/SoCs/ASICs.
supported companies. o Proof of concept-oriented R&D of ASICs/FPGAs.
2. Product Design Linked Incentive: A • Significance: The programme will be a step towards
reimbursement of up to 50% of the eligible the Electronics System Design & Manufacturing
expenditure subject to a ceiling of Rs.15 Crore per (ESDM) space by way of inculcating the culture of
application will be provided as fiscal support to the SoC/ System Level Design at Bachelors, Masters and
approved applicants who are engaged in Research level and act as a catalyst for the growth of
semiconductor design. Start-ups involved in fabless design.
3. Deployment Linked Incentive: An incentive of 6%
to 4% of net sales turnover over 5 years subject to a INDIAN RENEWABLE ENERGY DEVELOPMENT
ceiling of Rs.30 Crore per application will be provided AGENCY LIMITED
to approved applicants whose semiconductor design
In News: Recently, the Cabinet Committee on Economic
for Integrated Circuits (ICs), Chipsets, System on
Affairs has approved the equity infusion of Rs.1500 crore
Chips (SoCs), Systems & IP Cores and semiconductor
in Indian Renewable Energy Development Agency
linked design are deployed in electronic products.
Limited (IREDA) recently.
Centre for Development of Advanced Computing (C-
About Infusion:
DAC)
• This equity infusion will help in employment
• C-DAC is the premier Research & Development
generation of approximately 10200 jobs-year and
organisation of the Ministry of Electronics and
CO2 equivalent emission reduction of approximately
Information Technology (MeitY) for carrying out
7.49 Million Tonnes CO2/year.
R&D in IT, Electronics and associated areas.
• It will also enhance the specialized non-banking
• India's first supercomputer PARAM 8000 was
finance agency’s net worth, which will help it in
indigenously built (in 1991)by the Centre for
additional financing.
Development of Advanced Computing.
IREDA
CHIPS TO STARTUP (C2S) PROGRAMME • IREDA is a Public Limited Government Company
In News: Recently, the Ministry of Electronics and established as a Non-Banking Financial Institution in
Information (MeitY) has sought applications from 100 1987
academia, R&D organisations, start-ups and MSMEs • It is engaged in promoting, developing and extending
under its Chips to Startup (C2S) Programme. financial assistance for setting up projects relating to
new and renewable sources of energy and energy
About Chips to Startup (C2S) Programme: efficiency/conservation.
• Aim: • IREDA has been awarded “Mini Ratna” (Category -I)
status in 2015 by the Ministry of New and Renewable
Energy (MNRE).
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OnlyIAS UDAAN PLUS: ECONOMY

• The motto: “Energy For Ever”

• It offers a credit enhancement guarantee scheme to
3. SERVICE SECTOR IN INDIA
support the issuance of bonds by wind and solar
energy project developers. BUREAU OF INDIAN STANDARDS (BIS)
In News: Bureau of Indian Standards (BIS) completed 75
glorious years of its existence on 6th January 2022. BIS
came into existence as Indian Standards Institution (ISI)
in 1947.

About BIS
• Bureau of Indian standards (BIS) established under
the BIS Act 2016.
• BIS is the National Standard Body of India for the
harmonious development of the activities of
standardization, marking and quality certification of
goods and for matters connected therewith or
incidental thereto.
• BIS has been providing traceability and tangibility
benefits to the national economy in a number of
ways-
o Providing safe reliable quality goods;
o Minimizing health hazards to consumers;
o Promoting exports and imports substitute;
o Control over proliferation of varieties etc.
Through standardization, certification and
testing.
• BIS has its Headquarters at New Delhi.
Bureau of Indian Standards Act
• BIS Act allows multiple types of simplified conformity
assessment schemes including self-declaration of
conformity.
• BIS act provides enabling provisions for making
hallmarking of precious metal articles mandatory.
• The Act enables the Central Government to appoint
any authority/agency, in addition to the BIS, to verify
the conformity of products and services with the
established standard and issue certificate of
conformity.
• Provision for repair or recall, of the products (bearing
Standard Mark) that do not conform to the relevant
Indian Standard.
• New areas identified in standardization:
o Alternate fuels
o E-mobility
o Medical Devices
o Smart Cities
o Digital Technologies (e.g. Industry 4.0, Artificial
Intelligence, Block Chain etc.)
o New and Renewable energy.

Important initiatives for effective implementation of

the BIS Act, 2016:
• BIS (Hallmarking) Regulations, 2018 under the BIS
act calls for Hallmarking of:
o Gold jewellery and gold artefacts
o Silver jewellery and silver artefacts
• Penal provisions for better and effective compliance
have been made stringent under BIS (Hallmarking)
Regulations, 2018.
• Also includes Agmark, ISI, BIS, BEE and Other Ratings

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OnlyIAS UDAAN PLUS: ECONOMY

STATE REFORM ACTION PLAN o Further, the committee will suggest measures for
quadrupling exports of Handloom products.
In News: Recently, the Ministry of Commerce and
o To suggest ways and means for improving the
Industry has informed Lok Sabha about the rankings of
marketing of handloom products in the domestic
States and Union Territories (UTs) under State Reform
market.
Action Plan (SRAP), 2019.
o To suggest measures for improving the input
supplies (raw materials, credit, technology up-
About State Reform Action Plan (SRAP):
gradation, skilling, designs).
• It is an index that ranks states and Union Territories
based on the implementation of the Business Reform
National Handloom Day:
Action Plan.
• National handloom day is observed annually on 7th
• Released by: It has been released by the Department
August to honour the handloom weaving community
for Promotion of Industry and Internal Trade (DPIIT)
and highlight the importance of India’s handloom
since 2015.
industry.
• Objective: To attract investments by increasing the
• Significance:
Ease of Doing Business in each State. It introduces an
o The 7th of August was chosen as the National
element of healthy competition through a system of
Handloom Day to commemorate the Swadeshi
ranking states.
Movement, which was launched on this day in
• Parameters: It includes 180 reform points covering 1905.
12 business regulatory areas such as Access to o The first National handloom day was
Information, Single Window System, Labour, inaugurated on 7th August 2015.
Environment, Paying Taxes among others.
• Method of Ranking: The rankings are based on
feedback obtained from users/professionals against
180 out of 187 reform points. Its method is similar to
the methodology followed by the World Bank in its
global Doing Business rankings.
• Ranking: The top five states under the SRAP 2019
are Andhra Pradesh, Uttar Pradesh, Telangana,
Madhya Pradesh and Jharkhand.

SRAP, 2020:
• Department for Promotion of Industry and Internal
Trade (DPIIT) has prepared a 301-point State
Reforms Action Plan,2020, and shared with
States/UTs.
• The Action Plan is spread across 15 reform areas. It
seeks to promote a sector-specific approach to create
an enabling business environment across various
sectors in the country.
• Various sectors include: Trade License, Healthcare,
Legal Metrology, Fire License/NOC, Cinema Halls,
Hospitality, Telecom, Movie Shooting and Tourism.

SUNIL SETHI COMMITTEE

In News: Recently, the Government of India has
constituted a committee on the occasion of National
Handloom Day for doubling the production and
quadrupling the exports of handlooms in a span of 3
years.

About the Committee for the Handloom Sector:

• Headed by: Sh. Sunil Sethi, Chairman, Fashion Design
Council of India (FDCI) New Delhi,
• Terms of Reference of the Committee:
o To suggest the framework for doubling the
production of the Handloom Sector.
o To suggest ways for collaboration of handloom
weavers agencies with the designers,
organizations and exporters.

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OnlyIAS UDAAN PLUS: ECONOMY

expropriation risks and limited recourse covers

4. INDIAN INSURANCE MARKET (insolvency risks).

G.N. BAJPAI COMMITTEE Export Credit Guarantee Corporation (ECGC)

In News: Recently, the committee has submitted its • Establishment: The ECGC Ltd is wholly owned by the
report to the Chairperson, IFSCA. Ministry of Commerce and Industry.
• Objective: to promote exports from the country by
About G.N. Bajpai Committee providing credit risk insurance and related services
• Constituted by: The International Financial Services for exports.
Centres Authority (IFSCA) had constituted an • The Government of India had initially set up Export
Insurance Committee. Risks Insurance Corporation in 1957.
• Chairmanship: Mr. G.N. Bajpai, former Chairman LIC • After the introduction of insurance covers to banks
and SEBI. during the period 1962-64, the name was changed to
• Mandate: The mandate of the committee was to Export Credit & Guarantee Corporation Ltd in 1964.
identify key areas for the development of insurance • It was changed to ECGC Ltd in August 2014.
and reinsurance business from IFSC.

Key recommendations
• IFSCA has developed an eco-system for Aircraft
Leasing and Financing which can be utilized to
develop Aviation Insurance Hub and Trade Credit
Insurance at IFSC.
• IFSC can develop a framework for enabling
operations of Captive insurance model.
• Investment framework may be redesigned to give
more avenues for insurers to mobilize their funds to
ensure more returns and flexibility.

NATIONAL EXPORT INSURANCE ACCOUNT

SCHEME
In News: Recently, Government approves continuation of
the National Export Insurance Account (NEIA) scheme
and infusion of Rs. 1,650 crore Grant-in-Aid over 5 years.

About National Export Insurance Account (NEIA)

Scheme:
• NEIA Trust was established in 2006 to promote
project exports from India that are of strategic and
national importance.
• It promotes Medium and Long Term (MLT)/project
exports by extending (partial/full) support to covers
issued by ECGC to MLT/project export.
• Exim Bank, in April 2011, in conjunction with ECGC
Ltd., introduced a new initiative, viz. Buyer’s Credit
under the NEIA scheme, under which the Bank
finances and facilitates project exports from India.

Export transactions are eligible for inclusion under

NEIA:
• Only such medium and long-term export projects
which are viable and for which reinsurance is not
available.
• Exports to countries that are not likely to be
covered on purely commercial considerations or are
beyond country-exposure limits of ECGC or countries
currently facing economic/political difficulties, but
where Indian presence is required.
• Transactions involving investments by Indian
companies in overseas markets can be covered for
the protection of their investments against

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OnlyIAS UDAAN PLUS: ECONOMY

• Importance: To determine policy towards economic

5. FINANCIAL AND SECURITY development in Latin America, South East Asia and
MARKET other countries.

Ten principles of Washington Consensus:

PAYMENTS INFRASTRUCTURE DEVELOPMENT
1. Low government borrowing
FUND (PIDF)
2. Redirection of public spending from subsidies toward
In News: Recently, RBI has operationalises PIDF scheme broad-based provision of key pro-growth
to boost digital payments. 3. Tax reform
4. Positive Interest rates
About Payment Infrastructure Development Fund 5. Competitive exchange rates;
(PIDF): 6. Trade liberalization
• Objective: This fund has been created to encourage 7. Liberalization of inward foreign direct investment;
acquirers to deploy point of sale (PoS) infrastructure, 8. Privatization of state enterprises;
both physical and digital, in tier-3 to tier-6 centres 9. Deregulation
and north eastern states. 10. Legal security for property rights.
• Contributions to the fund: The RBI has made an
initial contribution of Rs 250 crore covering half the LINE OF CREDIT (LOC)
fund. The remaining will come from the card issuing
banks and card networks operating in the country. In News: Recently, India has signed an agreement
• Duration: The fund will be operational for three extending a USD 100 million Line of Credit (LOC) to Sri
years effective from 1st January, 2021 and may be Lanka for projects in the Solar Energy Sector. The LOC is
extended for two more years. for a period of 20 years, with an interest of 1.75%.
• Implementation: The types of acceptance devices to
Background:
be covered under the scheme are physical PoS, mPoS,
GPRS, PSTN, and QR code-based payments. • The agreement was signed between the Government
of Sri Lanka and the Export-Import (EXIM) Bank of
• Management: The fund will be governed through an
India.
advisory council but it will be managed and
administered by the RBI. • EXIM Bank is a specialized financial institution,
wholly owned by the Government of India.
• The maximum cost of the physical acceptance
device eligible for subsidy is Rs 10,000 (including
About Line of Credit
one-time operating cost up to Rs 500).
• It is a credit facility extended by a bank or any
• The maximum cost of the digital acceptance
other financial institution to a government,
device eligible for subsidy is Rs 300 (including
business or an individual customer, that enables
onetime operating cost up to Rs 200).
the customer to draw the maximum loan amount.
• Fixing Accountability: Acquirers of the subsidy shall
• The borrower can access funds from the line of credit
submit quarterly reports on the achievement of
at any time as long as they do not exceed the
targets to the RBI.
maximum amount (or credit limit) set in the
agreement and meet any other requirements such as
WASHINGTON CONSENSUS making timely minimum payments.
In News: Recently, the Union Government through its • It is not a grant but a ‘soft loan’ provided on
Budget 2021-22 has signalled its fiscal deficit at 9.5% of concessional interest rates to developing
GDP for FY21 and 6.8% in FY22. countries, which has to be repaid by the borrowing
government.
About Washington Consensus: • The projects under LOCs spread over different
• It refers to a set of broadly free market economic sectors: agriculture, infrastructure, telecom, railway,
ideas, supported by prominent economists and transmission, power, renewable energy etc.
international organizations, such as the IMF, the • These help to promote exports of Indian goods and
World Bank, the EU and the US. It was drawn from services, as 75% of the value of the contract must be
the advice of John Williamson. sourced from India.
• It minimized the state’s role in the economy and
pushed an aggressive free-market agenda of BLANK-CHEQUE COMPANY
deregulation, privatization, and trade liberalization.
In News: Recently, renewable energy producer ‘ReNew
• It paved the way for the domination of the
Power’ announced an agreement to merge with RMG
Western-style capitalism. It was aggressively
Acquisition Corp II, a blank-cheque company or a Special
promoted by the International Monetary Fund and
Purpose Acquisition Company (SPAC).
the World Bank.
• Aim: To advocate free trade, floating exchange rates,
About Blank-cheque Company:
free markets and macroeconomic stability.
• A SPAC, or a blank-cheque company, is an entity
specifically set up with the objective of acquiring
a firm in a particular sector.
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OnlyIAS UDAAN PLUS: ECONOMY

• The aim of this SPAC is to raise money in an Initial Alternative Investment Funds (AIF) Regulations
Public Offering (IPO), and at this point in time, it does and Portfolio Managers (PMS) Regulations.
not have any operations or revenues. o Investment advisory fees can be set mutually
• Once the money is raised from the public, it is kept in without any regulatory caps.
an escrow account, which can be accessed while
making the acquisition. SEBI
• If the acquisition is not made within two years of the • Statutory body
IPO, the SPAC is delisted and the money is returned • Established in 1992 in accordance with the
to the investors. provisions of the SEBI Act, 1992.
• Headquarters is situated in Mumbai.
Initial Public Offering: • Objective: To protect the interests of investors in
• IPO is the selling of securities to the public in the securities and to promote and regulate the securities
primary market. market.
• It is when an unlisted company makes either a fresh
issue of securities or an offer for sale of its existing INDIAN FOREIGN EXCHANGE RESERVES
securities or both for the first time to the public.
In News: According to recent data from Reserve bank of
india (RBI), India's Foreign Exchange (Forex) reserves
Shell Companies
posted a decline of USD 678 million during the week
• A shell company is a firm that does not conduct any ended 21st January 2022 to reach USD 634.287 billion.
operations in the economy, but it is formally
registered, incorporated, or legally organized in the Foreign Exchange Reserves:
economy.
• Foreign exchange reserves are assets held on reserve
• These are sometimes used illegitimately, such as to by a central bank in foreign currencies, which can
disguise business ownership from law enforcement include bonds, treasury bills and other government
or the public. securities.
• It needs to be noted that most foreign exchange
Escrow Account
reserves are held in US dollars.
• It is a legal concept describing a financial
• India’s Forex Reserve include:
instrument whereby an asset or escrow money is
o Foreign Currency Assets
held by a third party on behalf of two other
o Gold reserves
parties that are in the process of completing a
o Special Drawing Rights
transaction.
o Reserve position with the International
• The third-party holds the funds until both parties Monetary Fund (IMF).
have fulfilled their contractual requirements.
• Objectives of Holding Forex Reserves:
• Escrow is associated with real estate transactions, o Supporting and maintaining confidence in the
but it can apply to any situation where funds will pass policies for monetary and exchange rate
from one party to another. management.
o Provides the capacity to intervene in support of
ACCREDITED INVESTORS the national or union currency.
In News: Recently, the Securities and Exchange Board of o Limits external vulnerability by maintaining
India(SEBI) has come up with a framework for creating foreign currency liquidity to absorb shocks
so-called accredited investors. during times of crisis or when access to
borrowing is curtailed.
About Accredited Investors
• Accredited Investors are those investors who may be Foreign Currency Assets
considered to be well-informed or well-advised • FCAs are assets that are valued based on a currency
about investment products. other than the country's own currency.
• Eligibility: Anyone is eligible to become an • FCA is the largest component of the forex reserve. It
accredited investor provided the person satisfies at is expressed in dollar terms.
least one of three conditions: • The FCAs include the effect of appreciation or
1. One, the investor has a net worth of ₹7.5crore, depreciation of non-US units like the euro, pound and
with at least half of it in financial assets. yen held in the foreign exchange reserves.
2. Two, the investor has an annual income greater
than ₹2 crores. Special Drawing Rights
3. Three, the individual has an annual income • The SDR is an international reserve asset, created
greater than ₹1 crore and net worth greater than by the IMF in 1969 to supplement its member
₹5 crores, with at least half this amount in countries’ official reserves.
financial assets. • The SDR is neither a currency nor a claim on the
• Benefits of becoming an accredited investor: IMF. Rather, it is a potential claim on the freely usable
o Accredited investors get relaxation in the currencies of IMF members. SDRs can be exchanged
minimum amount to be invested in the for these currencies.
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OnlyIAS UDAAN PLUS: ECONOMY

• The value of the SDR is calculated from a weighted 1. Strict Inflation Targeting: It is adopted when
basket of major currencies, including the US dollar, the central bank is only concerned about keeping
the euro, Japanese yen, Chinese yuan, and British inflation as close to a given inflation target as
pound. possible, and nothing else.
• The interest rate on SDRs or (SDRi) is the interest 2. Flexible Inflation Targeting: It is adopted when
paid to members on their SDR holdings. the central bank is to some extent also concerned
• Recently, the IMF has made an allocation of SDR about other things, for instance, the stability of
12.57 billion (equivalent to around USD 17.86 billion) interest rates, exchange rates, output and
to India. Now, the total SDR holdings of India stand at employment.
SDR 13.66 billion.
CHINA’S DIGITAL CURRENCY
Reserve Position in the International Monetary Fund In News: Recently, China in February 2021 launched the
• A reserve tranche position implies a portion of the latest round of pilot trials of its new digital currency, with
required quota of currency each member country reported plans of a major roll-out by the end of the year
must provide to the IMF that can be utilized for its and ahead of the Winter Olympics in Beijing in February
own purposes. 2022.
• The reserve tranche is basically an emergency
account that IMF members can access at any time About China’s Digital Currency
without agreeing to conditions or paying a service • Officially titled the Digital Currency Electronic
fee. Payment (DCEP), the digital RMB (or Renminbi,
China’s currency) is, as its name suggests, a digital
INFLATION TARGETING version of China’s currency.
In News: Recently, India’s retail inflation hardened for • It can be downloaded and exchanged via an
the second month in a row in November, touching 4.91% application authorised by the People’s Bank of China
from 4.48% recorded in October, with urban parts (PBOC), China’s central bank.
experiencing a sharper rise in prices at a pace of 5.54% • Unlike e-wallets, the digital currency does not require
and vegetable prices jumping 7.45% from the previous Internet connectivity. The payment is made through
month. Near-field Communication (NFC) technology.
• Unlike non-bank payment platforms that require
Background users to link bank accounts, this can be opened with
• The Central Government has notified 4% CPI inflation a personal identification number.
as the target for the period from August 5, 2016, to • China is among a small group of countries that have
March 31, 2021, with the upper tolerance limit of 6 begun pilot trials; others include Sweden, South
percent and the lower tolerance limit of 2 per cent. Korea and Thailand.
• There is a flexible inflation targeting framework in
India (after the 2016 amendment to the Reserve Bank Digital Currency
of India (RBI) Act, 1934). • Digital currency is a payment method which exists
• The amended RBI Act provides for the inflation target only in electronic form and is not tangible.
to be set by the Government of India, in consultation • Digital currency can be transferred between entities
with the Reserve Bank, once every five years. or users with the help of technology like computers,
smartphones and the internet.
Inflation • Although it is similar to physical currencies, digital
• It refers to the rise in the prices of most goods and money allows borderless transfer of ownership as
services of daily or common use, such as food, well as instantaneous transactions.
clothing, housing etc. • Digital currency is also known as digital money and
• It measures the average price change in a basket of cyber cash. E.g. Cryptocurrency
commodities and services over time.
• The opposite and rare fall in the price index of this Cryptocurrency
basket of items is called ‘deflation’. • A cryptocurrency is a digital or virtual currency that
• It is indicative of the decrease in the purchasing uses cryptography for security.
power of a unit of a country’s currency. • Cryptocurrencies use decentralized technology to let
• This is measured in percentage. users make secure payments and store money
without the need to use their name or go through a
Inflation Targeting: bank.
• It is a central banking policy that revolves around • They run on a distributed public ledger called
adjusting monetary policy to achieve a specified blockchain, which is a record of all transactions
annual rate of inflation. updated and held by currency holders.
• Inflation targeting is known to bring more stability, • The most common cryptocurrencies are Bitcoin,
predictability, and transparency in deciding Libra, Ethereum, Ripple, and Litecoin.
monetary policy.

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DOGECOIN o There are a few stablecoins, which are backed by

a basket of multiple assets (commercial papers,
In News: Recently, Dogecoin’s value has risen
bonds, real estate, precious metals, etc).
phenomenally.
o The value of these stablecoins can fluctuate over
time subject to movement in commodity and
About Dogecoin
precious metal prices. Example: Digix Gold,
• Dogecoin is a Cryptocurrency created in 2013 by
backed by physical gold.
software engineers Billy Markus and Jackson Palmer.
• Crypto-Collateralized Stablecoins:
It was created as a faster alternative to Bitcoin.
o Crypto-collateralized stablecoins are more
• Origin: Dogecoin was started as a satire on the
decentralised than their peers and are backed by
numerous fraud crypto coins that had sprung up at
cryptocurrencies.
the time. It takes its name and logo from a Shiba Inu
o The flipside is price volatility and to address the
meme that was viral several years ago.
risk of price volatility, these stablecoins are over-
• Differences from Bitcoins: Bitcoins fixed the collateralized.
maximum possible number as 21 million (a figure o Example: Dai.
that is estimated to be reached by 2040). But the
• Non-collateralized stablecoins:
Dogecoin numbers do not have an upper limit and
o These stablecoins do not have any backing and
there are already more than 100 billion in existence.
are decentralized in the true sense and the
• Reason behind Dogecoin’s Rise: The main reason supply of non-collateralized stablecoins is
believed to be behind Dogecoin’s rise is its listing on governed by algorithms.
Coinbase (Coinbase is the most popular virtual o Example: Basis.
currency exchange in the US).

Concerns: CURRENCY WATCH LIST

• Cryptocurrencies are considered highly volatile In News: Recently, the United States (US) placed 11
and may crash as fast as they rise. This is because countries, including India in the Currency Practices
they do not have any intrinsic value such as land Monitoring List (Currency Manipulators Watch List).
or gold.
• Further, they are also susceptible to manipulation by Currency Manipulators:
small groups who often hold large numbers of virtual • A label given by the US government to countries it
currency in circulation. feels are engaging in “unfair currency practices”
by deliberately devaluing their currency against the
STABLECOINS dollar.
• The practice would mean that the country in question
In News: Recently, the Treasury Department of US and is artificially lowering the value of its currency to gain
other agencies are moving towards tighter regulation for an unfair advantage over others.
a fast-growing cryptocurrency called stablecoins.
• This is because the devaluation would reduce the cost
of exports from that country and artificially show a
About Stablecoins:
reduction in trade deficits as a result.
• A stablecoin is a type of cryptocurrency that is
typically pegged to an existing government- Currency Manipulator Watch List:
backed currency.
• The US Department of Treasury releases the semi-
• A cryptocurrency is a form of digital asset based on a annual report where it has to track developments in
network that is distributed across a large number of international economies and inspect foreign
computers. exchange rates.
• Stablecoins hold a bundle of assets in reserve, usually • It reviews currency practices of the US’ 20 biggest
short-term securities such as cash, government debt trading partners.
or commercial paper.
• Criteria: An economy meeting two of the three
• Stablecoins are useful because they allow people to criteria in the Trade Facilitation and Trade
transact more seamlessly in cryptocurrencies that Enforcement Act of 2015 is placed on the Watch List
function as investments, such as Bitcoin. and labeled as currency manipulators by the
• They form a bridge between old-world money and Treasury
new-world crypto aslo they promise to function like 1. A “significant” bilateral trade surplus with the US
perfectly safe holdings. — one that is at least USD 20 billion over a 12-
month period.
Types of Stablecoins: 2. A material current account surplus equivalent to
• Fiat-collateralized Stablecoins: They are at least 2% of Gross Domestic Product (GDP)
collateralized by fiat money, such as the US dollar, over a 12-month period.
euro or the pound, on a 1:1 ratio. Examples: Tether, 3. “Persistent”, one-sided intervention — when net
Gemini Dollar, and TrueSD. purchases of foreign currency totalling at least
• Stablecoins Backed by Other Assets: 2% of the country’s GDP over a 12 month period

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OnlyIAS UDAAN PLUS: ECONOMY

are conducted repeatedly, in at least six out of 12 • Interest Rate: A fixed rate of 2.5% per annum is
months. applicable on the scheme, payable semi-annually. The
interest on Gold Bonds shall be taxable as per the
Current Status: provision of Income Tax Act, 1961.
• Countries on the List: The other 10 countries on the
list with India that merit “close attention to their IPO GREY MARKET
currency practices” are China, Japan, Korea, Germany,
Ireland, Italy, Malaysia, Singapore, Thailand, and In News: Recently, Paytm’s stock has risen from ₹11,500
Mexico. to ₹21,000 in four days in the grey market.
• India’s Status: India met two of the three criteria that
IPO Grey Market
is the trade surplus criterion and the “persistent, one-
sided intervention” criterion. • Generally, when companies wish to raise funds to fuel
their growth, they sell a part of their stock on the
Reason behind India on the list: stock market. This process is called an initial public
offering, or IPO.
• The U.S. Treasury Department had recently retained
India in a watchlist for currency manipulators • An IPO grey market is an unofficial market where
submitted to the U.S. Congress. IPO shares or applications are bought and sold
before they become available for trading on the
• It cited higher dollar purchases (close to 5% of the
stock market.
gross domestic product) by the Reserve Bank of India
(RBI). • It is also termed a parallel market or an over-the-
counter market.
• Another trigger for the inclusion in the currency
watchlist is a trade surplus of $20 billion or more.
Regulations:
• There are no regulations to govern it as it is
SOVEREIGN GOLD BOND SCHEME unofficial.
In News: Recently, the Central government announced • The Securities and Exchange Board of India (SEBI),
the calendar for Sovereign Gold Bonds (SGB) that will be stock exchanges, and brokers have no part to play in
issued in four tranches, from October 2021 to March it.
2022. • Transactions are undertaken in cash on a one-on-one
basis.
About the Sovereign Gold Bond Scheme:
• The sovereign gold bond was introduced by the Kostak rate: It relates to an IPO application. So, the rate
Government in 2015. at which an investor buys an IPO application before the
• Government introduced these bonds to help reduce listing is termed the Kostak rate.
India’s over dependence on gold imports.
• The move was also aimed at changing the habits of Investors trade in the Grey Market
Indians from saving in physical form of gold to a • It’s an excellent opportunity for investors to purchase
paper form with Sovereign backing. a company’s shares even before they are listed,
• Eligibility: The bonds will be restricted for sale to especially if they feel that the company’s stock will
resident Indian entities, including individuals, HUFs, increase in value.
trusts, universities and charitable institutions. • If an investor has missed the deadline for the IPO
• Denomination and tenor: The bonds will be application or wishes to buy more shares then they
denominated in multiples of gram(s) of gold with a can approach the IPO grey market.
basic unit of 1 gram. The tenor will be for a period of
8 years with exit option from the 5th year to be Benefit for the companies
exercised on the interest payment dates. • For companies, the grey market is a great way to
• Minimum and Maximum limit: The minimum know how the demand for their shares is and how
permissible investment limit will be 1 gram of gold, the company’s shares might perform once it is
while the maximum limit will be 4 kg for individual, 4 listed.
kg for Hindu Undivided Family and 20 kg for trusts • Apart from that, an IPO grey market could be used
and similar entities per fiscal (April-March) notified to gauge how the company’s stock will perform
by the government from time to time. once it is listed.
• Joint Holder: In case of joint holding, the investment
limit of 4 kg will be applied to the first applicant only. BHIM-UPI LAUNCHED IN BHUTAN
• Benefit:
In News: Recently, Bhutan has become the first country
o Bonds can be used as collateral for loans.
to adopt India’s Unified Payment Interface (UPI)
o The capital gains tax arising on redemption of
standards for its quick response (QR) code.
SGB to an individual has been exempted.
• Term: The gold bonds come with a maturity period
About
of eight years, with an option to exit the investment
• The payment system was launched by NPCI
after the first five years.
International Payments Ltd. (NIPL), the

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OnlyIAS UDAAN PLUS: ECONOMY

international arm of National Payment Corporation E-RUPI

of India (NPCI), in partnership with the Royal
Monetary Authority (RMA) of Bhutan. In News: Recently, the Indian government is going to
launch an electronic voucher based digital payment
• Bhutan is the first country to adopt UPI standards
system e-RUPI.
for its Quick Response (QR) code, and the first
country in our immediate neighbourhood to accept
e-RUPI:
mobile based payments through the BHIM App.
• It is a person and purpose-specific digital payment
• It is also the second country after Singapore to have
solution which is a cashless and contactless
BHIM-UPI acceptance at merchant locations.
instrument for digital payment.
• Bhutan will also become the only country to both
issue and accept RuPay cards as well as accept • The system is pre-paid in nature and hence, assures
timely payment to the service provider without the
BHIM-UPI.
involvement of any intermediary.
Bharat Interface for Money (BHIM):
Working Mechanism:
• It is India’s digital payment application (app) that
• e-RUPI has a QR code or SMS string-based e-Voucher,
works through UPI, a system that powers multiple
which is delivered to the mobile of the beneficiaries.
bank accounts into a single mobile application.
• It will be like a prepaid gift voucher that can be
• BHIM app, that was developed by the National
redeemed at specific accepting centres without any
Payments Corporation of India (NPCI), was launched
credit or debit card, mobile app or internet banking.
in December, 2016.
• It will connect sponsors of the services with
• It is a Unified Payment Interface (UPI) that allows real
beneficiaries and service providers digitally without
time fund transfer.
any physical interface.
• Three levels of authentication:
• Developed By: The National Payments Corporation
1. The app binds with a device’s ID and mobile
of India (NPCI) in collaboration with the Department
number.
of Financial Services, Ministry of Health & Family
2. A user needs to sync whichever bank account
Welfare and National Health Authority.
(UPI or non-UPI enabled) in order to conduct the
transaction. • Countries using the voucher system: the US,
3. When a user sets up the app they are asked to Colombia, Chile, Sweden, Hong Kong, etc.
create a pin which is needed to log into the app.
The UPI pin, which a user creates with their bank INTERNATIONAL BULLION EXCHANGE
account is needed to go through with the In News: Recently, International Financial Services
transaction. Centres Authority (IFSCA) chief launches pilot run of
International Bullion Exchange; to go live on October 1,
Unified Payments Interface (UPI): 2021, the Foundation Day of IFSCA.
• It is an instant real-time payment system, allowing
users to transfer money on a real-time basis, across About the International Bullion Exchange:
multiple bank accounts without revealing details of • International Bullion Exchange will be a ‘Gateway for
one’s bank account to the other party. Bullion Imports into India’, wherein all bullion
imports for domestic consumption will be
National Payments Corporation of India (NPCI) channelised through the exchange.
• NPCI, an umbrella organisation for operating retail • Managed by: India International Bullion Holding
payments and settlement systems in India, is an IFSC Ltd (IIBH) has been created for setting up and
initiative of Reserve Bank of India (RBI) and Indian for operationalising International Bullion Exchange
Banks’ Association (IBA) under the provisions of the at IFSC, GIFT City.
Payment and Settlement Systems Act, 2007. • Expected Benefits:
• It is a “Not for Profit” Company under the provisions o All the market participants at a common
of Section 25 of Companies Act 1956 (now Section 8 transparent platform for bullion trading
of Companies Act 2013), with an intention to provide o Provide an efficient price discovery and
infrastructure to the entire Banking system in India assurance in the quality of gold
for physical as well as electronic payment and o Enable greater integration with other segments
settlement systems. of financial markets
o Help establish India’s position as a dominant
RuPay Card Scheme trading hub in the world.
• RuPay is the first-of-its-kind domestic Debit and
Credit Card payment network of India. Bullion
• The name, derived from the words ‘Rupee and • Bullion refers to physical gold and silver of high
‘Payment’, emphasises that it is India’s very own purity that is often kept in the form of bars or
initiative for Debit and Credit Card payments. coins.
• The card can also be used for transactions in
Singapore, Bhutan, UAE, Bahrain and Saudi Arabia.

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OnlyIAS UDAAN PLUS: ECONOMY

• Bullion can sometimes be considered legal tender

and is often held as reserves by central banks or held SECURITIES APPELLATE TRIBUNAL
by institutional investors.
In News: Recently, the Securities Appellate Tribunal
• Investors can buy or sell bullion through dealers who (SAT) stayed the order passed by Securities and Exchange
are active on one of several global bullion markets. Board of India (SEBI) that had put a one-year ban on a
retail company Chairperson and some other promoters
MARQUEE INSTITUTIONAL INVESTORS from the securities market.
In News: Recently, Infrastructure Investment Trusts
(InvIT) of the National Highways Authority of India About:
(NHAI) attracts marquee institutional investors. • SAT is a statutory body established under the
provisions of Section 15K of the SEBI Act, 1992.
About marquee investor: • Location: Mumbai.
• It is an investor well known for investing in • Composition:
companies that turn into success stories at a later o SAT consists of a Presiding Officer and Two other
date. members.
• The person could be either an individual or a o The Presiding officer of SAT shall be appointed
corporate/ institutional investor. by the Central Government in consultation with
• The purchase of some company’s shares by such the Chief Justice of India or his nominee.
investors gives others the hope that these companies • Powers: It has the same powers as vested in a civil
would turn out to be profitable investments for them court. Further, if any person feels aggrieved by SAT’s
too. decision or order can appeal to the Supreme Court.
• While this can prove to be true in many cases, it is not • Functions:
a rule, because no investor can dictate future o To hear and dispose of appeals against orders
business and economic events. passed by the SEBI or by an adjudicating officer
• One should not just look at the presence of marquee under the SEBI Act,1992.
investors, but the potential of those companies and o To hear and dispose of appeals against orders
then invest. passed by the Pension Fund Regulatory and
Development Authority (PFRDA).
SEBI MOOTS ENTRY NORMS TO SET UP STOCK o To hear and dispose of appeals against orders
EXCHANGES passed by the Insurance Regulatory
Development Authority of India (IRDAI).
In News: Recently, Securities and Exchange Board of
India (SEBI) has proposed a new framework for Securities and Exchange Board of India:
ownership of Market Infrastructure Institutions (MII) to
• SEBI is a statutory body established in 1992 in
facilitate new entrants to set up stock exchanges and
accordance with the provisions of the SEBI Act, 1992.
depositories.
• Initially, SEBI was a non-statutory body. In April,
1988 the SEBI was constituted as the regulator of
Key Proposals:
capital markets in India under a resolution of the
• A resident promoter setting up an MII may hold up to
Government of India.
100% shareholding, which will be brought down to
• Headquarters:
not more than (either 51% or 26%) in 10 years.
o The headquarters of SEBI is situated in Mumbai.
• A foreign promoter from Financial Action Task Force
o The regional offices of SEBI are located in
FATF member jurisdictions setting up an MII may
Ahmedabad, Kolkata, Chennai and Delhi.
hold up to 49% shareholding, which shall be brought
• Composition:
down to not more than (either 26% or 15%) in 10
o All decisions taken by SEBI are collectively taken
years.
by its Board that consists of a Chairman and eight
• Foreign individuals or entities from other than FATF
other members.
member jurisdictions may acquire or hold up to 10%
o SEBI also appoints various committees,
in an MII.
whenever required to look into the pressing
• Any person other than the promoter may acquire or issues of that time.
hold less than 25% shareholding.
• Function:
o To protect the interests of investors in securities
Market Infrastructure
and to promote and regulate the securities
• It is a system administered by a public organisation market.
or other public instrumentality, or a private and o Registering and regulating the working of stock
regulated association or entity, that provides services brokers, merchant bankers, underwriters,
to the financial industry for trading, clearing and portfolio managers, investment advisers and
settlement, matching of financial transactions and such other intermediaries who may be
depository functions. associated with securities markets in any
• Examples: include stock exchanges, depositories and manner.
clearing corporations.

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OnlyIAS UDAAN PLUS: ECONOMY

o SEBI is a quasi-legislative, quasi-judicial and CENTRAL SCRUTINY CENTRE AND IEPFA

quasi-executive body.
MOBILE APP
In News: Recently, the Finance Minister has virtually
DIGITAL INTELLIGENCE UNIT
launched the Central Scrutiny Centre (CSC). She also
In News: Recently, the Ministry of Communications has launched the mobile app for the Investor Education and
decided to set up a Digital Intelligence Unit (DIU) as a Protection Fund Authority (IEPFA).
nodal agency to deal with complaints of unsolicited
commercial communication (UCC) and cases of financial About Central Scrutiny Centre:
fraud, especially in the digital payments space. • Central Scrutiny Centre is an initiative of the Ministry
of Corporate Affairs. It aims to scrutinize the forms
About Digital Intelligence Unit: filled by companies under straight-through
• Objective: To coordinate with various law processes.
enforcement agencies, financial institutions and • Objective: The objective is to ensure that data quality
telecom service providers in investigating any is free from flaws.
fraudulent activity involving telecom resources. • Features of the Central Scrutiny Centre:
• Significance: Checking Unsolicited Commercial o It will Scrutinize the filings made by users under
Communication (UCC). The issue of UCC has been a straight-through processes
major area of concern for the Telecom Ministry as o The CSC will identify data quality issues and
well as the Telecom Regulatory Authority of India irregularities.
(TRAI). It has from time to time fined telecom o It will communicate the data quality issues to the
operators for not following its directives on stopping concerned Registrar of Companies. Then the
UCC. corrective steps can be taken to restore the
• Effective Redressal of Complaints: Along with DIU, authenticity and correctness of data.
a web and mobile application as well as a SMS-based
system shall be developed for effective redressal of Investor Education and Protection Fund (IEPF):
complaints. • IEPF has been established under the Companies
• Instilling Trust In the Digital Ecosystem: The DIU Act,1956 by the Companies (Amendment) Act,1999.
system will strengthen the trust of people in the • Objective: IEP Fund has been established for the
digital ecosystem and will make financial digital promotion of investors awareness and protection of
transactions primarily through mobile more secure the interests of investors.
and reliable, which will result in promotion of Digital • If the amounts such as dividends, applications money,
India. matured deposits, etc. remained unpaid or unclaimed
for a period of 7 years, then they will be transferred
UCC on over-the-top (OTT) Service Providers: to the IEPF.
• TRAI is also about to come up with a consultation • Credited to: The amounts credited to IEPF are
paper to deal with UCC on over-the-top (OTT) service maintained under the consolidated fund of India
providers. The launched systems does not address (Article 266 of the Constitution).
the issue of UCC on over-the-top (OTT) service • Utilisation of Fund:
providers such as WhatsApp. o The fund is utilized for promoting investor
• The Telecom Commercial Communication Customer awareness and protection of investor interests.
Preference Regulation, 2018 tightened the norms for o Based on the order of the court, the Fund can also
all stakeholders in the telecom ecosystem to have be utilized for distribution of any disgorged
facilities for users to complain against unsolicited amount among eligible applicants who suffered
calls or SMS. However, OTT players have thus far losses due to wrong actions by any person.
remained untethered from regulations as far as UCC
is concerned. IEPF Authority:
• Set up under the Ministry of Corporate Affairs as a
Telecom Regulatory Authority of India (TRAI): statutory body under the Companies Act 2013.
• Statutory Body: Established by an Act of Parliament • Aim: It aims to administer the Investor Education
(Telecom Regulatory Authority of India Act, 1997) and Protection Fund.
• Objectives: • Chairperson: Secretary Ministry of Corporate Affairs
o To regulate telecom services, including is the Chairperson of the authority.
fixation/revision of tariffs for telecom services.
o Provide a fair and transparent policy
environment which promotes a level playing BLOCKCHAIN-BASED TRACEABILITY INTERFACE
field and facilitates fair competition. In News: Recently, Spices Board India under Ministry of
• Recent Amendment: The TRAI Act was amended in Commerce and Industry and UNDP India’s Accelerator
the year 2000 to establish a Telecommunications Lab has signed a Memorandum of Understanding (MoU).
Dispute Settlement and Appellate Tribunal (TDSAT)
to take over the adjudicatory and disputes functions About blockchain-based traceability interface:
from TRAI.
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OnlyIAS UDAAN PLUS: ECONOMY

• Blockchain-based traceability interface will be • UNDP Accelerator Lab in India has been launched by
integrated with the e-Spice Bazaar portal. The portal UNDP in collaboration with Atal Innovation Mission.
was developed by Spices Board India for connecting
spices farmers with markets. REGULATIONS REVIEW AUTHORITY 2.0
• Significance:
• In News: Recently, the Reserve Bank Of India (RBI)
o It will bring ease and transparency in data
has constituted an Advisory Group to assist the
management across a complex network. This
second Regulations Review Authority (RRA 2.0).
network includes farmers, distributors,
• Background: In 1999, the RBI had set up a
processors, retailers, regulators, and consumers
Regulations Review Authority (RRA) for reviewing
thus simplifying the supply chain.
the regulations, circulars, reporting systems, based
o It will also allow farmers and other stakeholders
on the feedback from the public, banks, and financial
to access the information. This makes the entire
institutions.
supply chain more efficient and equitable.
About Regulations Review Authority (RRA 2.0):
Blockchain Technology:
• Regulations Review Authority (RRA 2.0) will
• A blockchain is a distributed ledger of information. It
streamline the regulatory instructions, reduce the
replicates across various nodes on a “peer-to-peer”
compliance burden of the entities under regulations.
network (P2P Network).
• The RRA 2.0 will achieve this by simplifying
• The data exists on multiple computers at the same
procedures and reduce reporting requirements
time. It constantly grows as new sets of recordings or
wherever possible.
blocks add to it in a decentralization manner.
• Headed by: M Rajeshwar Rao, Deputy Governor of
• All transactions on a standard Blockchain are verified
RBI has appointed as the head of the Regulations
and signed with cryptography. It is to ensure security
Review Authority 2.0.
and anonymity.
o Cryptography: It is the process of converting • Duration: The authority will be set up for a period of
ordinary plain text into unintelligible text and one year from May 1. But, RBI can extend its tenure.
vice-versa. • Terms of Reference of RRA 2.0:
o The intended person can encrypt the coded o Making regulatory and supervisory instructions
message and use them. more effective by removing redundancies and
• The ledger can record many transactions such as duplications.
monetary transactions, property transfer, and even o To obtain feedback from regulated entities on
ballot storage. simplification of procedures and enhancement of
ease of compliance.
Spices Board India: o RRA will reduce the compliance burden on
regulated entities by streamlining the reporting
• Spices Board is one of the five Commodity Boards
mechanism; revoking obsolete instructions if
functioning under the Ministry of Commerce &
necessary.
Industry.
o To examine and suggest the changes required in
• Objective: It is an autonomous body responsible for
the dissemination process of RBI circulars/
the export promotion of the 52 scheduled spices and
instructions.
development of Cardamom (Small & Large).
o To engage internally as well as externally with all
• Functions:
regulated entities and other stakeholders to
o Research, Development, and Regulation of
facilitate the process.
domestic marketing of Small & Large Cardamom;
o Post-harvest improvement of all spices;
Reserve Bank of India (RBI):
o Export promotion of all spices. Further, it will
• Formation: Established on 1st April, 1935 in
assist the exporters in technology up-gradation,
accordance with the provisions of the Reserve Bank
quality management, brand promotion, research
of India Act, 1934.
& product development;
• Originally privately owned, since nationalization in
o Development of spices in the North East;
1949, the Reserve Bank is fully owned by the
o Regulation of quality of spices for exports
Government of India.
through its quality evaluation services; etc.
• Major Functions:
UNDP Accelerator Lab: o Monetary Authority: Formulates, implements
and monitors the monetary policy.
• Accelerator Lab is an innovative initiative by the
o Recent Initiative: Government Securities
UNDP, Qatar Government and the Federal Republic of
Acquisition Programme (G-SAP).
Germany. It aims to find 21st-century solutions to
o Regulator and supervisor of the financial
today’s complex new challenges.
system: Prescribes broad parameters of banking
• Objective: These labs seek to identify grassroots
operations within which the country's banking
solutions together with local actors. Further, they will
and financial system functions.
validate their potential to accelerate further
o Manager of Foreign Exchange: Manages the
developments.
Foreign Exchange Management Act, 1999.
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OnlyIAS UDAAN PLUS: ECONOMY

o Issuer of currency: Issues and exchanges or o Monitor and enforce compliance with accounting
destroys currency and coins not fit for standards and auditing standards;
circulation. o Oversee the quality of service of the professions
o Developmental role: Performs a wide range of associated with ensuring compliance with such
promotional functions to support national standards and suggest measures for
objectives. improvement in the quality of service;
o Regulator and Supervisor of Payment and o Perform such other functions and duties as may
Settlement Systems: Introduces and upgrades be necessary or incidental to the aforesaid
safe and efficient modes of payment systems in functions and duties.
the country to meet the requirements of the • Powers:
public at large. o It can probe listed companies and those unlisted
• Recent Initiatives: public companies having paid-up capital of no
o Digital Payments Index, less than Rs 500 crore or annual turnover of no
o Payments Infrastructure Development Fund less than Rs 1,000 crore.
o National Payments Corporation of India (NPCI), o It can investigate professional misconduct
etc. committed by members of the Institute of
• Related Functions: Chartered Accountants of India (ICAI) for
o Banker to the Government: performs merchant prescribed class of body corporate or persons.
banking function for the central and the state
governments; also acts as their banker. MR. NILESH SHAH COMMITTEE
o Banker to banks: maintains banking accounts of
In News: Recently, the International Financial Services
all scheduled banks.
Centres Authority (IFSCA) has constituted an Expert
o The Ways and Means Advances (WMA) are
Committee on Investment Funds to recommend to IFSCA
short-term loan facilities which allow the Centre
on the road map for the funds industry in the
and states to borrow funds from the RBI to bridge
International Financial Service Centres (IFSCs) in India.
their temporary mismatch between expenditure
and receipts.
Nilesh Shah Expert Committee on Investment Funds:
• It has been constituted to holistically review the
RBI’s Publications:
Global best practices and make recommendations to
• Consumer Confidence Survey (CCS - Quarterly)
IFSCA on the roadmap for the industry.
• Inflation Expectations Survey of Households (IESH -
• It will recommend IFSCA on long term vision for
Quarterly)
operations of Investment Funds in IFSC.
• Financial Stability Report (Half-Yearly)
• It will identify issues that may be critical for
• Monetary Policy Report (Half-Yearly) development of the Investment Funds industry at
• Report on Foreign Exchange Reserves (Half-Yearly) IFSCs including inter-regulatory issues.
• Any other relevant item on building the ecosystem
NATIONAL FINANCIAL REPORTING AUTHORITY inter-alia on asset managers, hedge funds, PE, VC,
In News: Recently, National Financial Reporting sovereign funds, family offices, and the
Authority (NFRA) Chairperson has pitched for a accompanying professional services.
‘standalone legislation’ for the regulator in the interests
of autonomy. About the International Financial Services Centres
Authority (IFSCA):
About NFRA: • It a statutory body, which has been established under
• Established: NFRA was constituted in 2018 by the the International Financial Services Centres
Government of India under section 132 (1) of the Authority Act, 2019.
Companies Act, 2013. It is an audit regulator. • It is headquartered at GIFT City, Gandhinagar in
• Headquartered in New Delhi. Gujarat.
• Background: The decision to constitute the NFRA • Role of IFSCA:
was taken after the role of auditors and the Institute o It is a unified authority for the development and
of Chartered Accountants of India came under the regulation of financial products, financial
scanner for alleged lapses in various corporate scams services and financial institutions in the
including that at the Punjab National Bank. International Financial Services Centre (IFSC) in
• Composition: It consists of a chairperson, who shall India.
be a person of eminence and having expertise in o GIFT IFSC is the maiden international financial
accountancy, auditing, finance or law, appointed by services centre in India.
the Central Government and such other members not o Prior to the establishment of IFSCA, the domestic
exceeding 15. financial regulators, namely, RBI, SEBI, PFRDA
• Functions and Duties: and IRDAI regulated the business in IFSC.
o Recommend accounting and auditing policies
and standards to be adopted by companies for
approval by the Central Government;
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ENFORCEMENT DIRECTORATE In News: Recently, Union Cabinet granted ex-post facto

approval to the Memorandum of Understandings (MoUs)
In News: Recently, the Enforcement Directorate has
entered into by the Institute of Cost Accountants of India
transferred assets worth ₹8,441.50 crore to public sector
and the Institute of Company Secretaries of India with
banks that suffered losses to the tune of ₹22,585.83 crore
various foreign countries including Australia, UK and Sri
due to frauds committed allegedly by Vijay Mallya, Nirav
Lanka.
Modi and Mehul Choksi.
About Institute of Cost Accountants of India:
About Enforcement Directorate:
• ICMAI, previously known as the Institute of Cost &
• It is a Multi-Disciplinary Organization mandated with
Works Accountants of India (ICWAI), is a premier
the task of enforcing the provisions of two special
statutory professional accountancy body in India
fiscal laws – Foreign Exchange Management Act,
under the jurisdiction of Ministry of Corporate
1999 (FEMA) and Prevention of Money Laundering
Affairs, Government of India.
Act, 2002 (PMLA).
• Objectives: Promoting, regulating and developing
• Historical background:
the profession of Cost & Management Accountancy.
o 1st May, 1956: an ‘Enforcement Unit’ was
• Responsibilities:
formed, in Department of Economic Affairs, for
o It is the only licensing cum regulating body of
handling Exchange Control Laws violations
Cost & Management Accountancy profession
under Foreign Exchange Regulation Act, 1947
in India.
(FERA ’47).
o It recommends the Cost and Management
o In 1957: the Unit was renamed as ‘Enforcement
Accounting Standards to be followed by
Directorate’.
companies in India to which statutory
o In 1960: The administrative control of the
maintenance of cost records applicable.
Directorate was transferred from Department of
o ICMAI is solely responsible for setting the
Economic Affairs to Department of Revenue
auditing and assurance standards for
o For a short period of 04 years (1973 – 1977):
statutory Cost Audit to be followed in the Audit
the Directorate also remained under the
of cost statements in India.
administrative jurisdiction of Department of
o It also issues other technical guidelines on
Personnel & Administrative Reforms.
several aspects like Internal Audit, Management
• Powers:
Accounting etc. to be followed by practising Cost
o FEMA, a Civil Law having quasi-judicial powers,
Accountants while discharging their services.
for investigating suspected contraventions of the
o The ICMAI is a founder member of the
Exchange Control Laws and Regulations with the
International Federation of Accountants (IFAC),
powers to impose penalties on those adjudged
Confederation of Asian and Pacific Accountants
guilty.
(CAPA) and South Asian Federation of
o PMLA, a Criminal Law, whereby the Officers are
Accountants (SAFA).
empowered to conduct enquiries to locate,
o ICAI is a member of the National Foundation of
provisionally attach/confiscate assets derived
Corporate Governance (NFCG).
from acts of Schedules Offences besides arresting
and prosecuting the Money Launderers.
Institute of Company Secretaries of India (ICSI):
• Composition: Besides directly recruiting personnel,
• It is a statutory professional body in India under the
the Directorate also draws officers from different
jurisdiction of Ministry of Corporate Affairs,
Investigating Agencies, viz., Customs & Central
Government of India.
Excise, Income Tax, Police, etc. on deputation.
• Objective: promoting, regulating and developing the
• Other functions:
profession of company secretaries in India.
o Processing cases of fugitive/s from India under
Fugitive Economic Offenders Act, 2018.
o Sponsor cases of preventive detention under T+1 SETTLEMENT SYSTEM
Conservation of Foreign Exchange and In News: Recently, Securities and Exchange Board of
Prevention of Smuggling Activities Act, 1974 India (SEBI) allowed stock exchanges to start the T+1
(COFEPOSA) in regard to contraventions of system as an option in place of T+2 for completion of
FEMA. share transactions.
• Special courts:
o For the trial of an offence punishable under About T+1 Settlement System:
section 4 of PMLA, the Central Government (in • T+1 means that settlements will have to be cleared
consultation with the Chief Justice of the High within one day of the actual transactions taking place.
Court), designates one or more Sessions Court as • Currently, trades on the Indian stock exchanges are
Special Court(s). settled in two working days after the transaction is
o The court is also called PMLA Court. done (T+2).
• In April 2002, stock exchanges had introduced a T+3
INSTITUTE OF COST ACCOUNTANTS OF INDIA rolling settlement cycle. This was shortened to T+2
from April 1, 2003.

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Benefits of T+1 Settlement: • It deals with matters mainly related to companies law
• A shortened cycle reduces the settlement time and the insolvency law.
• Frees up the capital required to collateralise that risk • Term of members: Appointments will be for five
• Reduces the number of outstanding unsettled trades years from the date of assumption of charge or till
at any instant attaining the age of 65 or until further orders.
• Narrow the time window for a counterparty
insolvency/bankruptcy About ITAT:
• Reduces the systemic risk • It deals with income tax matters.
• It is statutory body in the field of direct taxes and its
T+1 vs T+2 Settlement: orders are accepted as final, on findings of fact.
• In T+2, if an investor sells shares, the settlement of • ITAT was the first Tribunal to be created on 25th
the trade takes place in two working days (T+2) and January, 1941 and is also known as ‘Mother Tribunal’.
the broker who handles the trade will get the money • With a view to ensuring highest degree of
on the third day, but will credit the amount in the independence of the ITAT, it functions under the
investor’s account only by the fourth day. Department of Legal Affairs in the Ministry of Law
• In effect, the investor will get the money only after and Justice and is kept away from any kind of control
three days. by the Ministry of Finance.
• In T+1, settlement of the trade takes place in one • The orders passed by the ITAT can be subjected to
working day and the investor will get the money on appellate challenge, on substantial questions of law,
the following day. before the respective High Court.

Settlement System: OPERATION MOLTEN METAL

• In the securities industry, the trade settlement period
• In News: Recently, the Directorate of Revenue
refers to the time between the trade date that an
Intelligence (DRI) arrested four foreign nationals and
order is executed in the market and the settlement
seized 85.535 kg gold from their possession during
date when a trade is considered final.
an intelligence operation code-named “Molten
• On the last day of the settlement period, the buyer Metal.”
becomes the holder of record of the security.
About Operation Molten Metal:
Global Scenario:
• It was reported that four foreign nationals were
• The US Depository Trust & Clearing Corporation found to be using sophisticated metallurgical
(DTCC) highlighted the immediate benefits of T+1, techniques to convert the smuggled gold in the form
including cost savings, reduced market risk, etc. of ‘EI’ laminates into bar/cylindrical form for further
• DTCC estimates that a move to T+1 could bring a 41 distribution.
per cent reduction in the volatility component of • The ‘EI’ laminates of the transformers were found to
National Securities Clearing Corporation’s margin have been made of gold-coated with nickel,
• In order to move to T+1, industry participants must essentially to hide the identity of the gold.
implement the necessary operational and business
• DRI indicated that the gold smuggled in the form of
changes and regulators must be engaged machinery parts was being melted and moulded into
bar/cylinder shapes before being disposed of in the
NATIONAL COMPANY LA W TRIBUNAL local market.
In News: Recently, the government has appointed 31
people as judicial, technical and accountant members at Directorate of Revenue Intelligence (DRI):
the National Company Law Tribunal (NCLT) and the • It is India’s apex anti-smuggling intelligence,
Income Tax Appellate Tribunal (ITAT). investigations and operations agency.
• It was started in 1957.
Background: • It works under the Central Board of Indirect Taxes
• Around 250 posts lying vacant at various key & Customs, Ministry of Finance, Government of
tribunals and appellate tribunals such as the NCLT, India.
the DRT, the TDSAT and the SAT. • DRI is the major intelligence agency which enforces
• SC had recently flagged concerns, saying the Centre the prohibition of the smuggling of items including
was “emasculating” tribunals by not appointing gold, diamonds, electronics, foreign currency, and
officials to the quasi-judicial bodies that are facing a counterfeit Indian currency.
staff crunch. • Role and Function: It is tasked with detecting and
curbing smuggling of contraband, including drug
About NCLT: trafficking and illicit international trade in wildlife
• It is a quasi-judicial body in India that adjudicates and environmentally sensitive items, as well as
issues relating to companies in India. combating commercial frauds related to
• Established on 1st June, 2016 (Companies Act, 2013). international trade and evasion of Customs duty.
• Formed based on the recommendations of the Justice
Eradi Committee.
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OnlyIAS UDAAN PLUS: ECONOMY

SOCIAL STOCK EXCHANGES NSE-SHINE BULLION BLOCKCHAIN PLATFORM

In News: Recently, SEBI’s technical group (TG) on social In News: Recently, first time in India, the NSE-Shine
stock exchanges (SSEs) has submitted its report. platform will provide a data framework for bullion bar
integrity for settlement of Gold derivatives contracts.
About Social Stock Exchanges (SSEs):
• The idea of the SSE as a platform for listing social About
enterprise, voluntary and welfare organisations so • It is a blockchain platform for gold bullion launched
that they can raise capital was mooted in the Union by the National Stock Exchange (NSE) with Chainflux
Budget 2019-20. in support with India Gold Policy Centre (IGPC) and
• Social enterprise can be defined as a non-loss; non- the Indian Bullion and Jewellers’ Association (IBJA).
dividend paying company created and designed to • It will also help in ensuring data security, data
address a social problem. integrity, and data traceability for each bullion bar ID
• It was proposed to be set up under the market at any point of time.
regulator SEBI. • The platform is developed by The India Gold Policy
• Aim of the initiative is to help social and voluntary Centre (IGPC) at the Indian Institute of Management,
organisations which work for social causes to raise Ahmedabad (IIM-A) and the Indian Bullion and
capital as equity or debt or a unit of mutual fund. Jewellers’ Association (IBJA) with the NSE and
• SSE already exists in countries such as Singapore, UK, Chainflux.
Canada among others. These countries allow firms • The platform will be launched in November 2021.
operating in sectors such as health, environment and NSE-approved refiners will be able to use the system
transportation to raise capital. to record details of their produced bullion.
• The expert panel was headed by Harsh Bhanwala, • It will create a bullion repository for all bullion bars
ex-Chairman, Nabard. produced by NSE-approved refiners as per the NSE
Refiner Standards (NRS).
Recommendations of the Report:
• Eligibility: National Stock Exchange of India Limited (NSE)
o Both for-profit (FP) and not-for-profit • NSE is India's largest financial market.
organisations (NPO) should be allowed to tap the • Incorporated in 1992, the NSE has developed into a
SSE provided they are able to demonstrate that sophisticated, electronic market, which ranked
social intent and impact. fourth in the world by equity trading volume.
o Corporate foundations, political and religious • NSE was the first exchange in India to provide
organisations should be made ineligible to raise modern, fully automated electronic trading.
funds using the SSE mechanism. • The NSE is the largest private wide-area network in
• Modes available for fundraising: India.
o For NPOs, it shall be equity, zero coupon zero • The NIFTY 50 is the flagship index on the National
principal bond (ZCZP), development impact Stock Exchange of India Ltd. (NSE).
bonds, social impact fund, currently known as • The Index tracks the behaviour of a portfolio of blue
social venture fund (SVP) with 100 per cent chip companies, the largest and most liquid Indian
grants-in grants out provision, and donations by securities. It includes 50 of the approximately 1600
investors through mutual funds. companies listed on the NSE.
o For FP enterprises, it will be equity, debt,
development impact bonds, and social venture SAARTHI MOBILE APP
funds.
• Corpus size of the fund: • In News: Recently, the Securities and Exchange
o Minimum corpus size for such funds be reduced Board of India (SEBI) launched the Saarthi mobile
from Rs 20 crore to Rs 5 crore and the minimum application.
subscription amount be reduced from Rs 1 crore
to Rs. 2 lakh. About the App
• The capacity building fund for SSE: • Aim: to create awareness among investors about the
o It should have a corpus of Rs 100 crore. This fund basic concepts of the securities market.
should be housed under Nabard. Exchanges and • The app will also explain about KYC process, trading
other developmental agencies such as SIDBI and settlement, Mutual Funds (MF), recent market
should be asked to contribute towards this fund. developments, investor grievances redressal
• List of broad activities: mechanism, etc.
o These include eradicating hunger, poverty • The application uses both Hindi and English.
malnutrition and inequality; promoting gender • It is available for both iOS and android users. In
equality by empowerment of women and future, the app will be made available in local
LGBTQIA+ communities; training to promote languages as well.
rural sports; and slum area development,
affordable housing. Securities and Exchange Board of India (SEBI):

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OnlyIAS UDAAN PLUS: ECONOMY

• SEBI is a statutory body established on 12th April intervention, can use this index to create investment
1992 in accordance with the provisions of the products at lower costs.
Securities and Exchange Board of India Act, 1992.
• Functions: Its basic function is to protect the FOREIGN CONTRIBUTION REGULATION ACT
interests of investors in securities and to promote In News: Recently, the Union Ministry of Home Affairs
and regulate the securities market. (MHA) has cancelled the Foreign Contribution
• Composition: SEBI Board consists of a Chairman and (Regulation) Act (FCRA), 2010 registration of various
several other whole time and part time members. non-governmental organisations (NGOs).
• SEBI also appoints various committees, whenever
required to look into the pressing issues of that time. Foreign Contribution (Regulation) Act (FCRA), 2010:
• Foreign funding of persons in India is regulated
IC15 CRYPTOCURRENCY INDEX under FCRA act and is implemented by the Ministry
• In News: Recently, Superapp CryptoWire launched of Home Affairs.
India’s first cryptocurrency index, IC15, which will • Individuals are permitted to accept foreign
measure the performance of the 15 most widely contributions without permission of MHA.
traded cryptocurrencies listed on leading crypto • Monetary limit for acceptance of such foreign
exchanges by market capitalization. contributions shall be less than Rs. 25,000.
• The Act ensures that the recipients of foreign
IC15: contributions adhere to the stated purpose for which
• The crypto currency index known as IC15 has been such contribution has been obtained.
launched by the global crypto currency super app • Under the Act, organisations are required to register
kryptowire. themselves every five years.
• It is a rule based broad market index by market • Registered NGOs can receive foreign contributions
capitalisation, which tracks the performance of top15 for five purposes: Social, educational, religious,
widely traded liquid crypto currencies, in terms of economic and cultural.
market capitalization.
• The index includes a governance committee. Foreign Contribution (Regulation) Amendment Act,
• It comprises leading domain experts, academicians 2020:
and industry practitioners. • Prohibition to accept foreign contribution: The
• These experts will monitor and administer the Act bars public servants from receiving foreign
rebalancing of top15 cryptos every quarter. contributions.
• The base date is 1 April,2018 while the base value of • Transfer of foreign contribution: The Act prohibits
the index is set at 10000. the transfer of foreign contribution to any other
• This index captures over 80% of market movement. person not registered to accept foreign contributions.
• The index has a low correlation with other asset • Aadhaar for registration: The Act makes Aadhaar
classes, as gains in IC15 would not mirror gains in number mandatory for all office bearers, directors or
other asset classes. key functionaries of a person receiving foreign
• As of January 1, 2022, Bitcoin, Ethereum, Binance contribution, as an identification document.
Coin, and Solana are sitting on the top four positions • FCRA account: The Act states that foreign
on the IC15 index. contributions must be received only in an account
designated by the bank as FCRA account in such
Eligibility conditions: branches of the State Bank of India, New Delhi.
• Should have traded on at least 90% of the days during • Reduction in use of foreign contribution for
the review period and administrative purposes: The Act proposes that not
• Should be among the 100 most liquid more than 20% of the total foreign funds received
cryptocurrencies in terms of trading value. could be defrayed for administrative expenses. In
• Should be in the top 50 in terms of the circulating FCRA 2010 the limit was 50%.
market capitalization. • Surrender of certificate: The Act allows the central
government to permit a person to surrender their
Significance: registration certificate.
• IC15 can be replicated for creating index-
linked products such as index funds or exchange-
traded funds (ETFs).
• Usually, the performance of a mutual fund scheme is
assessed with reference to a benchmark, which could
be a total return index of the Nifty or the Sensex.
• IC15 is the first index in India that can act as a
benchmark of the underlying cryptocurrency market
and the performance benchmark for fund managers.
• Moreover, robo-advisors, which provide financial
advice with moderate to minimal human
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OnlyIAS UDAAN PLUS: ECONOMY

exposure, related party transactions,

6. BANKING SECTOR OF INDIA customer complaints.
2. Middle Layer: It will consist of NBFCs that
CURRENT ACCOUNT currently fall in the ‘systemically important’
category along with deposit-taking non-bank
• In News: Recently, the current account surplus
lenders. Housing Finance Companies,
moderated to $15.5 billion (2.4% of GDP) in the
Infrastructure Finance Companies,
quarter ended September of 2020-21 from $19.2
Infrastructure Debt Funds, Core Investment
billion (3.8% of GDP) in the first quarter this fiscal.
Companies. The proposals for this set of NBFCs
The current account saw a deficit of $7.6 billion
include:
(1.1%) in the year-ago quarter.
o Subjected to tighter corporate
governance norms.
About Current Account
o No changes proposed in the capital-to-
• It maintains a record of the country’s transactions
risk-assets ratio (CRAR) of 15% with a
with other nations, in terms of trade of goods and
minimum Tier-I ratio of 10%.
services, net earnings on overseas investments
o NBFCs cannot provide loans to companies
and net transfer of payments over a period of time,
for buy-back of securities.
such as remittances.
o NBFCs with 10 or more branches will be
• This account goes into a deficit when money sent
required to adopt core banking solutions.
outward exceeds that coming inward.
3. Upper Layer: It will include about 25-30 NBFCs
• Current account constitute: net income, interest and and will be subjected to bank-like regulation.
dividends and transfers such as foreign aid, o It will have to implement differential
remittances, donations among others. standard asset provisioning and also the
• It is measured as a percentage of GDP. large exposure framework as applicable to
• The formulae for calculating CAD is: banks.
o Current Account = Trade gap + Net current o The concept of Core Equity Tier-1 will be
transfers + Net income abroad introduced for this category and is proposed
o Trade gap = Exports – Imports. to be set at 9%.
• Significance: Current account balance measures the o Also be subject to a mandatory listing
external strength or weakness of an economy. requirement.
• A current account surplus implies the country is a net 4. Top Layer: This layer will be empty for now and
lender to the rest of the world, while a deficit will be populated with NBFCs, where the RBI may
indicates it is a net borrower. see an elevated systemic risk.
• A Current Account Deficit (CAD) shows that the
country has become uncompetitive, and investors are Non-Bank Financial Companies (NBFCs):
not willing to invest there. They may withdraw their • Financial institutions that offer various banking
investments. services but do not have a banking license.
• Registered under the Companies Act, 1956
REGULATION OF NBFCS engaged in the business of loans and advances,
In News: Recently, the Reserve Bank of India (RBI) has acquisition of
proposed a tighter regulatory framework for Non- shares/stocks/bonds/debentures/securities issued
Banking Financial Companies (NBFCs) by creating a four- by a government or local authority, or other
tier structure with a progressive increase in intensity of marketable securities.
regulation. • A non-banking institution that is a company and has
principal business of receiving deposits under any
About: scheme or arrangement in one lump sum or in
• Objective: It is to keep the big NBFCs in good installments is also an NBFC.
financial health. It has become important after the
failure of extremely large NBFC like IL&FS. Difference b/w Banks & NBFCs
• Four Tier Structure: • NBFCs lend and make investments and hence their
1. Base layer: Includes the large number of small activities are akin to that of banks; however, there are
NBFCs in the country and will subject to the least a few differences as given below:
regulation. It is because they have a limited o NBFC cannot accept demand deposits
impact on systemic stability. The proposals for o NBFCs do not form part of the payment and
this set of NBFCs include: settlement system and cannot issue cheques
o Entry-level net owned funds required to be drawn on itself
raised to Rs 20 crore from Rs 2 crore. o The deposit insurance facility of Deposit
o NPA classification norm of 180 days will be Insurance and Credit Guarantee Corporation is
harmonized to 90 days. not available to depositors of NBFCs, unlike in the
o Disclosure requirements will be widened case of banks.
by including disclosures on types of

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OnlyIAS UDAAN PLUS: ECONOMY

LEGAL ENTITY IDENTIFIER (LEI) SYSTEM by leveraging existing capabilities in traditional

lending.
In News: Recently, the RBI has introduced the Legal
Entity Identifier (LEI) for Large Value Transactions in
Digital Lending Models
Centralised Payment Systems.
• Bank/NBFC-owned digital platforms: They
operate under the direct regulatory purview of RBI.
LEI
• Fintech companies’ proprietary digital platforms:
• The Legal Entity Identifier (LEI) is a 20-character
They work in partnership with banks/NBFCs,
alpha-numeric code used to uniquely identify parties
typically under an outsourcing arrangement to
to financial transactions worldwide.
support sourcing of borrowers, assess
• It is a reference code like a bar code used across
creditworthiness using alternative data and recover
markets and jurisdictions to uniquely identify a
the dues. Platforms are not required to seek any
legally distinct entity that engages in a financial
registration with RBI and are only indirectly
transaction.
regulated through RBI’s outsourcing guidelines
• It is designed to be a linchpin for financial data the
applicable to Banks/NBFCs.
first global and unique entity identifier enabling risk
• Peer-to-peer (P2P) lending platforms: They
managers and regulators to identify parties to
usually involve the otherwise unregulated retail
financial transactions instantly and precisely.
lenders. RBI has mandated such platforms to seek
registration as NBFC-P2P and thus they are directly
Objective:
regulated by RBI.
• To improve the quality and accuracy of financial data
• Significance of Digital Lending
reporting systems for better risk management.
o Instant disbursal of funds
• To create a global reference data system that
o Customer friendly application
uniquely identifies every legal entity in any
o Paperless process
jurisdiction that is party to a financial transaction.
o Transparent and simplified process
o Reasonable interest rates
JAYANT KUMAR DASH COMMITTEE o Ensure swift payback
In News: Recently, RBI has constituted a working group o Reduced credit gap
on digital lending including online platforms and mobile o Operating cost efficiency
apps. o Financial inclusion, Example - JAM (Jan Dhan-
Aadhaar-Mobile) trinity
About Jayant Kumar Dash committee:
• RBI had constituted the working group on digital OPEN MARKET OPERATIONS (OMO)
lending including lending through online platforms In News: Recently, RBI announces ₹20,000 crore open
and mobile apps under the chairmanship of Jayant market operations on February 10.
Kumar Dash, Executive Director, RBI.
• Set up in the backdrop of business conduct and About Open Market Operation
customer protection concerns arising out of the • Open market operations is the sale and purchase of
increase in digital lending activities. government securities and treasury bills by RBI or
• Objective: The working group will study digital the central bank of the country.
lending activities in the regulated and unregulated • Objective: to regulate the money supply in the
financial sector so that an appropriate regulatory economy.
approach can be put in place.
• It is one of the quantitative monetary policy tools.
• Composition: The working group comprises six
• RBI carries out the OMO through commercial banks
members–four will be from within the RBI and the
and does not directly deal with the public.
remaining will be external. Jayant Kumar Dash,
• RBI employs two kinds of OMOs:
executive director at the RBI will head the group that
1. Outright Purchase (PEMO): this is permanent
has been advised to submit its report within three
and involves the outright selling or buying of
months.
government securities.
2. Repurchase Agreement (REPO): this is short-
Digital Lending:
term and are subject to repurchase.
• It consists of lending through web platforms or
mobile apps, by taking advantage of technology for
Monetary RBI action in Effect in the
authentication and credit assessment.
policy OMO economy
• India’s digital lending market has seen a significant
Expansionary Buys Injects money in
rise over the years. The digital lending value
Contractionary Sells Removes money
increased from USD 33 billion in FY15 to USD 150
out
billion in FY20 and is expected to hit the USD 350-
billion mark by FY23.
Other Facts:
• Banks have launched their own independent digital
lending platforms to tap in the digital lending market

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OnlyIAS UDAAN PLUS: ECONOMY

• Quantitative tools: control the extent of money • Provide technical assistance like Project Report,
supply by changing the Cash Reserve Ratio (CRR), or Viability study, and consultancy services.
bank rate or open market operations.
• Qualitative tools: include persuasion by the Central NATIONAL BANK FOR FINANCING
bank in order to make commercial banks discourage INFRASTRUCTURE AND DEVELOPMENT
or encourage lending which is done through moral
• In News: Recently, the Rajya Sabha cleared the
suasion, margin requirement, etc.
National Bank for Financing Infrastructure and
Development (NBFID) Bill, 2021.
BANKS BOARD BUREAU • NBFID will be set up as a corporate body with
In News: Recently, the Banks Board Bureau (BBB) may be authorised share capital of one lakh crore rupees.
entrusted with the job to select MDs and DMDs of a
proposed ₹1-lakh crore development financial institution Objective:
(DFI) being set up to accelerate infrastructure financing. • Financial Objective: To directly or indirectly lend,
invest, or attract investments for infrastructure
About BBB: projects located entirely or partly in India.
• It was set up in February 2016 as an autonomous • Developmental Objective: Includes facilitating the
body based on the recommendations of the RBI- development of the market for bonds, loans, and
appointed Nayak Committee. derivatives for infrastructure financing.
• It was part of the Indradhanush Plan.
• It will make recommendations for appointment of Functions of NBFID:
whole-time directors as well as non-executive • Extending loans and advances for infrastructure
chairpersons of Public Sector Banks (PSBs) and state- projects.
owned financial institutions. • Taking over or refinancing such existing loans.
• The Ministry of Finance takes the final decision on the • Attracting investment from private sector investors
appointments in consultation with the Prime and institutional investors for infrastructure
Minister’s Office. projects.
• Organising and facilitating foreign participation in
Composition: infrastructure projects.
• Banks Board Bureau comprises the Chairman, three • Facilitating negotiations with various government
ex-officio members i.e Secretary, Department of authorities for dispute resolution in the field of
Public Enterprises, Secretary of the Department of infrastructure financing.
Financial Services and Deputy Governor of the • Providing consultancy services in infrastructure
Reserve Bank of India, and five expert members, two financing.
of which are from the private sector.
Source of funds:
Development Financial Institution (DFI): • NBFID may raise money in the form of loans or
• A development finance institution is an agency that otherwise both in Indian rupees and foreign
finances infrastructure projects that are of national currencies or secure money by the issue and sale of
importance but may or may not conform to various financial instruments including bonds and
commercial return standards. debentures.
• In most cases, these agencies are government owned • NBFID may borrow money from:
and their borrowings enjoy the comfort of o Central Government
government guarantees, which help bring down the o Reserve Bank of India (RBI)
cost of funding. o Scheduled commercial banks
o Mutual funds
Objectives: o Multilateral institutions (World Bank and Asian
• Economic development of the country Development Bank)
• These banks provide financial as well as the technical
support to various sectors Management of NBFID:
• DFIs do not accept deposits from people • Governed by a Board of Directors. The Chairperson
• Raise funds by borrowing funds from governments will be appointed by the central government in
and by selling their bonds to the general public consultation with RBI.
• It also provides a guarantee to banks on behalf of • A body constituted by the central government will
companies and subscriptions to shares, debentures, recommend candidates for the post of the Managing
etc. Director and Deputy Managing Directors.
• Underwriting enables firms to raise funds from the • The Board will appoint independent directors based
public. Underwriting a financial institution on the recommendation of an internal committee.
guarantees to purchase a certain percentage of
shares of a company that is issuing IPO if it is not Support from the Central Government:
subscribed by the Public. • GoI will provide grants worth Rs. 5,000 crore to
NBFID by the end of the first financial year.
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OnlyIAS UDAAN PLUS: ECONOMY

• Also a guarantee at a concessional rate of up to 0.1% Impact on Mutual Funds

for borrowing from multilateral institutions, • Typically, MFs have treated the date of the call option
sovereign wealth funds, and other foreign funds. on AT1 bonds as the maturity date.
• Costs towards insulation from fluctuations in foreign • If these bonds are treated as 100-year bonds, it raises
exchange (in connection with borrowing in foreign the risk in these bonds as they become ultra long-
currency) may be reimbursed by the government in term.
part or full. • This could also lead to volatility in the prices of these
• Upon request by NBFID, the government may bonds as the risk increases the yields on these bonds
guarantee the bonds, debentures, and loans issued by rises.
NBFID. • Bond yields and bond prices move in opposite
directions and therefore, the higher yield will drive
Prior sanction for investigation and prosecution: down the price of the bond, which in turn will lead to
• No investigation can be initiated against employees of a decrease in the net asset value of MF schemes
NBFID without the prior sanction of: holding these bonds.
1. The central government in case of the • These bonds are not liquid and it will be difficult for
chairperson or other directors, and MFs to sell these to meet redemption pressure.
2. The managing director in case of other
employees. Courts will also require prior Impact On Banks:
sanction for taking cognisance of offences in • AT1 bonds have emerged as the capital instrument of
matters involving employees of NBFID. choice for state banks as they strive to shore up
capital ratios.
Other Development Financial Institutions: • If there are restrictions on investments by mutual
• Any person to set up a DFI by applying to RBI. funds in such bonds, banks will find it tough to raise
• RBI may grant a licence for DFI in consultation with capital at a time when they need funds in the wake of
the central government. the soaring bad assets.
• RBI will also prescribe regulations for these DFIs. • A major chunk of AT1 bonds is bought by mutual
funds.
AT-1 BONDS
In News: Recently, the decision of the Securities and SHYAMALA GOPINATH COMMITTEE
Exchange Board of India (SEBI) to slap restrictions on In News: Recently, the RBI has set up a five-member
mutual fund (MF) investments in additional tier-1 (AT1) Standing External Advisory Committee (SEAC), headed by
bonds has raised a storm in the MF and banking sectors. former RBI Deputy Governor Shyamala Gopinath, for
evaluating applications for universal banks and Small
About AT-1 bonds: Finance Banks (SFBs).
• Type of unsecured, perpetual bonds that banks issue
to shore up their core capital base to meet the Basel- About the Committee:
III norms. • Tenure: The committee will have a tenure of three
• Two routes through to acquire bonds: years.
1. Initial private placement offers of AT-1 bonds by • Secretariat of the Committee: The secretarial
banks seeking to raise money. support to the committee would be provided by RBI’s
2. Secondary market buys of already-traded AT-1 Department of Regulation.
bonds. • Functions: The applications for universal banks and
• AT-1 bonds are like any other bonds issued by banks SFBs will first be evaluated by the RBI to ensure
and companies, but pay a slightly higher rate of prima facie eligibility of the applicants, after which
interest compared to other bonds. the SEAC will evaluate the applications.
• These bonds are also listed and traded on the
exchanges. So, if an AT-1 bondholder needs money, On-tap Licensing of Universal Bank
he can sell it in the secondary market. • An ‘on-tap’ facility means the RBI will accept
• Investors cannot return these bonds to the issuing applications and grant licenses for banks throughout
bank and get the money. i.e there is no put option the year.
available to its holders. • The policy allows aspirants to apply for universal
• The issuing banks have the option to recall AT-1 bank license at any time, subject to the fulfillment of
bonds issued by them (termed call options that allow the set conditions.
banks to redeem them after 5 or 10 years).
• Banks issuing AT-1 bonds can skip interest payouts Small Finance Banks (SFBs):
for a particular year or even reduce the bonds’ face • Small Finance Banks are the financial institutions
value. which provide financial services to the unserved and
• AT-1 bonds are regulated by RBI. If the RBI feels that unbanked region of the country.
a bank needs a rescue, it can simply ask the bank to • They are registered as a public limited company
write off its outstanding AT-1 bonds without under the Companies Act, 2013.
consulting its investors.
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OnlyIAS UDAAN PLUS: ECONOMY

Functions: • A government official who deals with complaints

• It shall primarily undertake basic banking activities made by ordinary people against public
of acceptance of deposits and lending to small organizations. This concept of Ombudsman arrived
business units, small and marginal farmers, micro from Sweden.
and small industries and unorganised sector entities. • It means an officer appointed by the Legislature to
• It can also undertake other non-risk sharing simple handle complaints against a service or administrative
financial services activities, not requiring any authority.
commitment of own funds, such as the distribution of • In India an Ombudsman is appointed to resolve
mutual fund units, insurance products, pension grievances in the following sectors:
products, etc. o Insurance Ombudsman
• It can also become an Authorised Dealer in foreign o Income Tax Ombudsman
exchange business for its clients’ requirements. o Banking Ombudsman
• No restriction in the area of operations of SFBs;
however, preference will be given to those applicants RBI Retail Direct Scheme:
who, in the initial phase, set up the bank in a cluster • It is aimed at enhancing access to government
of under-banked States/districts, such as in the securities market for retail investors.
North-East, East and Central regions of the country. • It offers them a new avenue for directly investing in
securities issued by the Government of India and the
Universal Banks: State Governments.
• Financial entities such as commercial banks, • Investors will be able to easily open and maintain
Financial Institutions, Non-Banking Financial their government securities account online with the
Companies (NBFCs), which undertake multiple RBI, free of cost.
financial activities under one roof, thereby creating a
financial supermarket. EMERGENCY CREDIT LINE GUARANTEE SCHEME
• Focus on leveraging their large branch network and
In News: Recently, the government has extended the
offer a wide range of services under a single brand
emergency credit line guarantee scheme till the end of
name/Bank’s name.
March 2022 or till guarantees for an amount of Rs 4.5 lakh
• As per guidelines on on-tap licensing of universal
crore are issued under the scheme, whichever is earlier.
banks issued in August 2016, resident individuals
and professionals having 10 years of experience in
About the scheme:
banking and finance at a senior level are eligible to
• Launched as part of the Atmanirbhar Bharat Abhiyan
promote universal banks.
package in May 2020 to mitigate the distress caused
• Large industrial houses are excluded as eligible
by coronavirus-induced lockdown, by providing
entities but are permitted to invest in the banks up to
credit to different sectors, especially MSMEs.
10%.
• 100% guarantee coverage is being provided by the
• A non-operative financial holding company (NOFHC)
National Credit Guarantee Trustee Company,
has been made non-mandatory in case of promoters
whereas Banks and Non-Banking Financial
being individuals or standalone
Companies (NBFCs) provide loans.
promoting/converting entities who/which do not
• The credit will be provided in the form of a
have other group entities.
Guaranteed Emergency Credit Line (GECL) facility.
• No Guarantee Fee shall be charged by NCGTC from
ONE NATION ONE OMBUDSMAN the Member Lending Institutions (MLIs) under the
In News: Recently, the Indian Prime Minister has Scheme.
launched the integrated ombudsman scheme. • Interest rates under the Scheme shall be capped at
9.25% for banks and FIs, and at 14% for NBFCs.
Integrated Ombudsman Scheme:
• Aims to further improve the grievance redress Eligibility:
mechanism for resolving customer complaints • Borrowers with credit outstanding up to Rs. 50 crore
against entities regulated by RBI. as on 29th February, 2020, and with an annual
• The central theme is based on ‘One Nation-One turnover of up to Rs. 250 crore are eligible under the
Ombudsman’ with one portal, one email and one Scheme.
address for the customers to lodge their complaints. • On 1st August 2020, the government widened the
• There will be a single point of reference for customers scope of the Rs. 3 lakh crore-ECLGS scheme by
to file their complaints, submit the documents, track doubling the upper ceiling of loans outstanding and
status and provide feedback. including certain loans given to professionals like
• A multi-lingual toll-free number will provide all doctors, lawyers and chartered accountants for
relevant information on grievance redress and business purposes under its ambit.
assistance for filing complaints.
Benefits of the scheme:
Ombudsman:

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OnlyIAS UDAAN PLUS: ECONOMY

• It will provide credit to the sector at a low cost, • Administered by: The RBI administers these
thereby enabling MSMEs to meet their operational chests. Even though these chests are usually situated
liabilities and restart their businesses. on the premises of different banks.
• By supporting MSMEs to continue functioning during • Belongs to: The money present in the currency chest
the current unprecedented situation, the Scheme is belongs to the RBI. But the money kept in the strong
also expected to have a positive impact on the room outside the currency chests belongs to the
economy and support its revival. bank.
• Security arrangement for the chests:
NATIONAL BANK FOR AGRICULTURE AND RURAL o The security of currency chests varies from one
DEVELOPMENT (NABARD) bank to the other where the chests are situated.
o The Reserve Bank of India (RBI) reimburses the
In News: Recently, it has been reported that National
security expenses to the bank as per the set
Bank for Agriculture and Rural Development (NABARD)
norms.
closed its business at Rs. 6.57 lakh crore in FY 2020-21,
recording a growth rate of 23.5%. • Recovery Procedure if stolen: As per the set
guidelines, the bank in which the currency chest is
About NABARD situated is liable to fulfil the loss of the currency chest.
• Origin: Came into existence on 12th July 1982 by • Role of currency chests:
transferring the agricultural credit functions of the o The RBI offices in various cities receive the notes
Reserve Bank of India (RBI) and refinance functions from note presses and coins from the mints.
of the then Agricultural Refinance and Development These are sent to the currency chests and small
Corporation (ARDC). coin depots from where they are distributed to
bank branches.
• Status: It is a statutory body established under
o The RBI has set up over 4,075 currency chests all
‘National Bank for Agriculture and Rural
over the country. Besides these, there are around
Development Act, 1981’.
3,746 bank branches that act as small coin depots
• Objective:
to stock small coins.
o It is a development bank focussing primarily on
the rural sector of the country.
RBI guidelines:
o It is the apex banking institution to provide
• Area of the strong room/ vault of at least 1,500 sq ft.
finance for Agriculture and rural development.
For those situated in hilly/ inaccessible places, the
• Headquarters: Mumbai.
strong room/ vault area of at least 600 sq ft.
• Major Functions of NABARD:
• The new chests should have a processing capacity of
o It provides refinance support for building rural
6.6 lakh pieces of banknotes per day. Those situated
infrastructure.
in the hilly/ inaccessible places, a capacity of 2.1 lakh
o It supervises Cooperative Banks and Regional
pieces of banknotes per day.
Rural Banks (RRBs) and helps them develop
• The currency chests should have Chest Balance Limit
sound banking practices and integrate them to
(CBL) of Rs 1,000 crore, subject to ground realities
the CBS (Core Banking Solution) platform.
and reasonable restrictions, at the discretion of the
o It is involved in designing Union government’s
Reserve Bank.
development schemes and their implementation.
o NABARD has various international partnerships
including leading global organizations and World SUDARSHAN SEN COMMITTEE
Bank-affiliated institutions that are breaking In News: Recently, RBI committee (Sudarshan Sen
new ground in the fields of rural development as committee) has come out with a host of suggestions in a
well as agriculture. bid to streamline the functioning of Asset Reconstruction
• Cooperation with the RBI: Companies (ARCs).
o RBI provides 3 directors to NABARD’s Board of
Directors. About the committee:
o NABARD provides recommendations to RBI on • RBI set up a six-member committee headed by
issue of licenses to Cooperative Banks, opening of Sudarshan Sen, former executive director, Reserve
new branches by State Cooperative Banks and Bank of India (RBI).
RRBs. • The performance of the ARCs has so far remained
lacklustre, both in ensuring recovery and in revival of
CURRENCY CHEST businesses.
In News: Recently, a Private Security Guard in • Lenders could recover only about 14.29% of the
Chandigarh has stolen Rs 4 crore from a Currency Chest amount owed by borrowers in respect of stressed
of Axis Bank. assets sold to ARCs in the 2004-2013 period.
• To improve the performance of ARCs, the RBI had
About Currency Chest: appointed a six-member committee headed by
• Meaning: A currency chest is a place where the Sudarshan Sen, former executive director, Reserve
Reserve Bank of India (RBI) stocks the money meant Bank of India (RBI) to examine the issues and
for banks and ATMs.
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OnlyIAS UDAAN PLUS: ECONOMY

recommend measures for enabling ARCs to meet the • Types: Normal and special.
growing requirements of the financial sector. o Special WMA or Special Drawing Facility is
provided against the collateral of the government
Recommendations: securities held by the state. The interest rate for
• Online Platform for Sale of Stressed Assets SDF is one percentage point less than the repo
• Expanding Scope of SARFAESI Act rate.
• Providing Additional Resources o It gets normal WMA after the state has
• Using Insolvency and Bankruptcy Code (IBC) exhausted the limit of SDF. The number of loans
framework under normal WMA is based on a three-year
• Large Loans for sale to ARCs average of actual revenue and capital
• For Ensuring Debt Aggregation expenditure of the state.
• RBI should ensure fair competition between the
NARCL and private ARCs CREDIT RATING
In News: Recently, Credit ratings agency ‘Moody's’ has
Asset Reconstruction Companies (ARCs): changed India's sovereign rating outlook from 'negative'
• It is a specialized financial institution that buys to 'stable' and affirmed the country's rating at “Baa3".
the Non-Performing Assets (NPAs) from banks
and financial institutions so that they can clean up Credit Rating
their balance sheets. • A credit rating is an assessment of the
• A NPA is a loan or advance for which the principal or creditworthiness of a borrower.
interest payment remained overdue for a period of 90 • Individuals, corporations and governments are
days. assigned credit ratings, whoever wants to borrow
• Typically, ARCs buy banks’ bad loans by paying a money.
portion as cash up front (15% as mandated by the • Individuals are given ‘credit scores’, while
RBI), and issue security receipts (SRs) for the balance corporations and governments receive ‘credit
(85%). ratings’.
• This helps banks to concentrate on normal banking • International credit rating agencies: Fitch Ratings,
activities. Banks, rather than going after the Moody’s Investors Service and Standard & Poor’s
defaulters by wasting their time and effort, can sell (S&P) are controlling approximately 95% of global
the bad assets to the ARCs at a mutually agreed value. ratings business.
• The SARFAESI Act, 2002 provides the legal basis • In India: six credit rating agencies registered under
for the setting up of ARCs in India. Securities and Exchange Board of India (SEBI)
• RBI has got the power to regulate the ARCs. namely, CRISIL, ICRA, CARE, SMERA, Fitch India and
Brickwork Ratings.
WAYS AND MEANS ADVANCES
In News: Recently, the RBI has decided to continue with Rating Implies:
the existing interim Ways and Means Advances (WMA) • Baa1: The highest rating of speculative grade
scheme limit of Rs. 51,560 crore for all States/UTs upto Moody's Long-term Corporate Obligation Rating.
September 2021, given the prevalence of Covid-19. Obligations rated Ba1 are judged to have speculative
elements and are subject to substantial credit risk.
About Ways and Means Advances: • Baa2: Obligations rated Baa2 are subject to moderate
• Temporary loan facilities provided by RBI to the credit risk.
government to enable it to meet temporary • Baa3: The lowest investment grade, just a notch
mismatches between revenue and expenditure. above junk status (Speculative).
• Launch: The WMA scheme was introduced in 1997.
• Objective: To meet mismatches in the receipts and Sovereign Credit Rating (SCR):
payments of the government. • SCR is an independent assessment of the
• Features: creditworthiness of a country or sovereign entity.
o The government can avail immediate cash from • It can give investors insights into the level of risk
the RBI, if required. But it has to return the associated with investing in the debt of a particular
amount within 90 days. Interest is charged at the country, including any political risk.
existing repo rate. • In addition to issuing bonds in external debt markets,
o If the WMA exceeds 90 days, it would be treated another common motivation for countries to obtain a
as an overdraft (the interest rate on overdrafts is sovereign credit rating is to attract Foreign Direct
2 percentage points more than the repo rate). Investment (FDI).
o The limits for WMA (for Centre) are decided by • At the request of the country, a credit rating agency
the government and RBI mutually and revised will evaluate its economic and political environment
periodically. to assign it a rating.
o A higher limit provides the government • Moody’s considers a Baa3 or higher rating to be of
flexibility to raise funds from RBI without investment grade, and a rating of Ba1 and below is
borrowing them from the market. speculative.
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OnlyIAS UDAAN PLUS: ECONOMY

• S&P gives a BBB- or higher rating to countries it o Revival of Sick companies

considers investment grade, and grades of BB+ or o Winding up of Companies
lower are deemed to be speculative or "junk" grade. o Once NCLT admits the case for insolvency
process under IBC, 2016 the case cannot be
NATIONAL COMPANY LAW APPELLATE withdrawn even if the payment decides to settle.
TRIBUNAL But SC using Art 142 (extraordinary
constitutional provisions) allowed it.
In News: Recently, Justice Ramalingam Sudhakar, former
chief justice of Manipur High Court, has been appointed
as president of the National Company Law Tribunal FINANCIAL STABILITY REPORT
(NCLT). In News: Recently, the Reserve Bank of India released the
24th issue of the Financial Stability Report (FSR).
About NCLAT
• Constituted under Companies Act, 2013. About FSR
• Functions: It hears appeals against the orders of - • The Financial Stability Report (FSR) is published
o NCLT under Section 61 of the Insolvency and twice each year by the RBI.
Bankruptcy Code, 2016 (IBC). • It presents an assessment of the health of the
o Insolvency and Bankruptcy Board of India under financial system.
Section 202 and Section 211 of IBC. • The RBI also conducts a Systemic Risk Survey (SRS),
o The Competition Commission of India (CCI). wherein it asks experts and market participants to
• Composition: assess the financial system on five different types of
o The President of the Tribunal and the risks:
chairperson and Judicial Members of the 1. Global
Appellate Tribunal shall be appointed after 2. Financial
consultation with the Chief Justice of India. 3. Macroeconomic
o The Members of the Tribunal and the Technical 4. Institutional
Members shall be appointed on the 5. General
recommendation of a Selection Committee
consisting of: It focuses on public and private banks with the
o Chief Justice of India or his nominee— following aspects:
Chairperson. • Capital availability for working
o A senior Judge of the Supreme Court or a Chief • Cost of NPAs and whether they are manageable
Justice of High Court— Member. • Credit flow in different sectors of the economy
o Secretary in the Ministry of Corporate Affairs— • Credit flow at personal levels (households)
Member. • Macro-financial risks in the economy
o Secretary in the Ministry of Law and Justice— • Macro-financial risks refer to the risks that originate
Member. from the financial system but affect the wider
o Secretary in the Department of Financial Services economy as well as risks to the financial system that
in the Ministry of Finance— Member. originate in the wider economy.
• Eligibility: • Stress tests are also performed by RBI as part of FSR
o Chairperson: Should be/been judge of the
Supreme Court or should be/been Chief Justice of Significance:
the High Court. • The report helps in assessing the health of the
o Judicial Member: Is/has been a judge of a High financial systems of the economy.
Court or is a judicial member of a tribunal for 5 • It helps as an Early Warning System in case of any
years or more. financial issues.
o Technical member: Person with proven ability, • Coming from the Central Bank, it is reliable and the
integrity and standing having special knowledge growth or fallouts can be trusted.
and experience of 25 years or more (in specified • Making the fallouts in the Report as points to work on
areas). will give the country a direction towards growth.
• Term: Term of office of chairperson and members is
5 years and they can be reappointed for additional 5 Major Highlights:
years. • Resurfacing COVID-19 infections: Global economic
recovery has been losing momentum in the second
National Company Law Tribunal (NCLT), 2013 half of 2021 in the face of resurfacing COVID-19
• It is a successor body to the Company Law Board. infections.
• It is based on Justice Erandi Committee with respect • Progress of vaccination: On the domestic front,
to Insolvency and winding up of companies. progress in vaccination has enabled the recovery to
• It is a quasi-judicial body set up to govern companies regain traction after the debilitating second wave of
established under the Companies Act, 2013 the pandemic.
• Powers of NCLT, 2013: • Capital to risk-weighted assets ratio (CRAR): The
o Mismanagement and Oppression capital to risk-weighted assets ratio (CRAR) of
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OnlyIAS UDAAN PLUS: ECONOMY

scheduled commercial banks (SCBs) rose to a new • It proposed that revenue deficit, fiscal deficit, tax
peak of 16.6 percent and their provisioning coverage revenue and the total outstanding liabilities be
ratio (PCR) stood at 68.1 per cent in September 2021. projected as a percentage of gross domestic product
• Gross Non-Performing Asset (GNPA): Macro stress (GDP) in the medium-term fiscal policy statement.
tests for credit risk indicate that the gross non- • It made mandatory to place annually the Union
performing asset (GNPA) ratio of SCBs may increase Budget documents, Medium Term Fiscal Policy
from 6.9 per cent in September 2021 to 8.1 per cent Statement, Macroeconomic Framework Statement
by September 2022 under the baseline scenario and and Fiscal Policy Strategy Statement in the
to 9.5 per cent under a severe stress scenario. Parliament.
• Financial institutions in India: They have remained
resilient amidst the pandemic and stability prevails in Fiscal Deficit:
the financial markets, cushioned by policy and • Fiscal Deficit is the difference between the total
regulatory support. income of the government (total taxes and non-debt
• Levels of risks: There are five levels of risks - very capital receipts) and its total expenditure.
high, high, medium, low and very low. For India, the • A Fiscal Deficit situation occurs when the
main sources of risks are commodity prices, domestic government’s expenditure exceeds its income. This
inflation, equity price volatility, asset quality difference is calculated both in absolute terms and
deterioration, credit growth and cyber disruptions. also as a percentage of the Gross Domestic Product
(GDP) of the country.
DIRECT MONETISATION OF DEFICIT
In News: Recently, the Minister of Heavy Industries and NEW REGULATORY REGIME FOR MICR OFINANCE
Public Enterprises has inaugurated NATRAX- the High In News: Recently, RBI proposed to lift the interest rate
Speed Track (HST) in Indore, Madhya Pradesh. cap on Microfinance Institutions (MFIs), and said all
micro loans should be regulated by a common set of
Direct Monetisation: guidelines irrespective of who gives them.
• It means that the Reserve Bank of India (RBI)
directly funds the Central government’s deficit Microfinance:
against government bonds or securities. • Microfinance is a form of financial service which
• Until 1997, the government used to sell securities ad provides small loans and other financial services to
hoc Treasury-Bills directly to the RBI. This allowed poor and low-income households.
the government to technically print equivalent • In India, all loans that are below Rs. 1 lakh are
amounts of currency to meet its budget deficit. considered as microloans.
• This practice was stopped over its inflationary • Based on the recommendations of Malegam
impact and in favour of fiscal prudence. Committee, RBI introduced a comprehensive
• This is different from the “indirect” monetisation regulatory framework for NBFC-MFIs in 2011.
that RBI does when it conducts the Open Market • Microcredit is delivered through a variety of
Operations (OMOs) and/or purchases bonds in institutional channels viz.,
the secondary market. 1. Scheduled commercial banks (SCBs) (including
• Direct monetisation of deficit is also referred to small finance banks (SFBs) and regional rural
as helicopter money when large sums of new money banks (RRBs))
are printed to stimulate an economy during a crisis — 2. Cooperative banks,
like a recession. 3. Non-banking financial companies (NBFCs)
• Significance: Direct monetization of the deficit could 4. Microfinance institutions (MFIs) registered as
bring down interest rates and delay inflationary NBFCs as well as in other forms.
pressures arising out of the additional spending.
Provisions:
Ad-hoc treasury bills: • A common definition of microfinance loans: The
• It enabled the automatic monetisation of central document aims to provide one common definition for
government budget deficits and they were eliminated all regulated microfinance sector entities.
in 1997. • Capping the outflow on account of repayment of
• All T-bill issuances now represent market loan obligations of a household to a percentage of the
borrowings of the central government. household income. Further, borrowers can
determine the period of repayments as per their
Fiscal Responsibility Budget Management (FRBM) requirements.
Act: • A Board approved policy for household income
• It was enacted in August 2003 and sets targets for assessment.
the government to achieve fiscal stability. • There should be no pre-payment penalty; no
• It provides the provisions for required flexibility for collateral requirement, and greater repayment
RBI to deal with inflation, to improve the frequency for all microfinance loans.
management of public funds, to strengthen fiscal • Alignment of pricing guidelines for NBFC-MFIs
prudence and to reduce fiscal deficits. with guidelines for NBFCs.
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OnlyIAS UDAAN PLUS: ECONOMY

• Introduction of a standard simplified fact sheet on ACCOUNT AGGREGATOR

the pricing of microfinance loans. Further, MFIs need
In News: Recently, eight major banks have joined the
to display minimum, maximum and average interest
Account Aggregator (AA) network that will enable
rates charged on microfinance loans on their
customers to easily access and share their financial data.
websites for greater transparency.
About Account Aggregator
Non-Banking Financial Company (NBFC)-Micro
Finance Institution (MFI): • It is a non-banking financial company engaged in the
business of providing, under a contract, the service of
• The NBFC-MFI is a non-deposit taking financial
retrieving or collecting financial information
company.
pertaining to its customer.
• Conditions to qualify as NBFC-MFI:
• It is also engaged in consolidating, organising and
o Minimum Net Owned Funds (NOF) of Rs. 5 crore.
presenting such information to the customer or any
o At least 85% of its Net Assets in the nature of
other financial information user as may be specified
Qualifying Assets.
by the bank.
• NBFCs can operate at a very high level, MFIs cater to
• AAs enable flow of data between Financial
only the smaller level of social strata, with need of
Information Providers (FIPs) and Financial
smaller amounts as loans.
Information Users (FIUs).
• The architecture of AA is based on the Data
G-SEC ACQUISITION PROGRAMME 2.0 Empowerment and Protection Architecture (DEPA)
In News: Recently, RBI halted its bond buying under the framework.
G-Sec Acquisition Programme (GSAP). • The licence for AAs is issued by the RBI, and the
financial sector will have many AAs.
About Government Securities Acquisition
Programme (G-SAP): Benefits:
• The G-Sec Acquisition Programme (G-SAP) is • For Consumers: It allows customers to avail various
basically an unconditional and a structured Open financial services from a host of providers on a single
Market Operation (OMO), of a much larger scale portal based on a consent method, consumers can
and size. choose what financial data to share and with which
• RBI has called the G-SAP as an OMO with a ‘distinct entity.
character’. • For Banks: As an addition to India’s digital
• The word ‘unconditional’ here connotes that RBI has infrastructure, it will allow banks to access consented
committed upfront that it will buy G-Secs irrespective data flows and verified data.
of the market sentiment. • Reduce Frauds: AA reduces the fraud associated
• Objective: To achieve a stable and orderly evolution with physical data by introducing secure digital
of the yield curve along with management of liquidity signatures and end-to-end encryption for data
in the economy. sharing.

Significance: SECURED OVERNIGHT FINANCING RATE

• The GSAP would provide more comfort to the bond
In News: Recently, State Bank of India (SBI) has executed
market. As the borrowing of the Government
two inter-bank short term money market deals with
increased this year, RBI has to ensure there is no
pricing linked to SOFR (Secured Overnight Financing
disruption in the Indian market.
Rate).
• The programme will help to reduce the spread
between repo rate and the ten-year government bond
Secured Overnight Financing Rate (SOFR)
yield.
• It is a benchmark interest rate for dollar-
• The G-SAP will almost serve the purpose of an OMO
denominated derivatives and loans that is replacing
calendar, which had been on the bond market’s wish
the London interbank offered rate (LIBOR).
list for a long time.
• SOFR is based on transactions in the Treasury
repurchase market, where investors offer banks
Government Securities:
overnight loans backed by their bond assets.
• These are debt instruments issued by the
government to borrow money. • It is a replacement for USD LIBOR (London Inter-
bank Offered Rate) that may be phased out end-2021.
• The two key categories:
1. Treasury bills (T-Bills): short-term • The overnight rate is generally the interest rate that
large banks use to borrow and lend from one another
instruments which mature in 91 days, 182 days,
in the overnight market.
or 364 days, and
2. Dated securities: long-term instruments, which
LIBOR
mature anywhere between 5 years and 40 years
• LIBOR is the benchmark interest rate at which major
• Note: T-Bills are issued only by the central
global banks lend to one another.
government, and the interest on them is determined
by market forces.
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• LIBOR is administered by the Intercontinental • Traditional banks have many advantages over
Exchange, which asks major global banks how much neobanks, such as funding and most importantly
they would charge other banks for short-term loans. customers' trust. However, legacy systems are
• The rate is calculated using the Waterfall weighing them down and they find it difficult to adapt
Methodology, a standardized, transaction-based, to the growing needs of a tech-savvy generation.
data-driven, layered method. • While neobanks don’t have the funds or customer
• LIBOR has been subject to manipulation, scandal, and base to overthrow traditional banks, they have
methodological critique, making it less credible today something special in their arsenal innovation.
as a benchmark rate. • Neo-banks offer a wide range of offerings to
• LIBOR is being replaced by the Secured Overnight customers across retail and small-to-medium
Financing Rate (SOFR) on June 30, 2023, with phase- enterprise (SME) categories.
out of its use beginning after 2021.
Neo banks in India:
NEO-BANKS • Currently, there are 10 neo banks in India, and a
couple of more are in the process of entering the
In News: The Neo-banks are changing the face of fin-tech
market.
by bridging the gap between the services that traditional
• ICICI Bank took the lead in the segment and
banks offer and the evolving expectations of customers in
partnered with three neo banks: Free, Instant Pay,
the digital age.
and Yelo.
About Neo-banks: • Two types of neobanks.
1. The Neobank doesn’t have a banking license
• Neo-banks are online-only financial technology
themselves and instead partner up with a
(fin-tech) companies that operate solely digitally
traditional bank to provide their products
or via mobile apps.
2. The neobanks obtain banking licenses
• Neo-banks are digital banks without any physical
themselves to operate fully on their own.
branches offering services that traditional banks
• Currently in India, neobanks are not allowed to
don’t.
hold customer deposits and neither virtual license
• In India, these firms don't have a bank licence of
is being granted by the RBI since it still maintains its
their own, but rely on bank partners to offer licensed
stand on the need for physical presence as per its
services as the RBI doesn’t allow banks to be 100%
2014 guidelines,
digital yet (though some foreign banks offer digital-
• Leaving them with the only option to partner with a
only products through their local units).
traditional bank.
• Major features of Neo Bank:
o They run on targeted customer segments that are
not the concerns of legacy banks, such as SMEs, REVISED PROMPT CORRECTIVE ACTION (PCA)
tech-savvy millennials, and low-wage classes. FRAMEWORK
o Lower fees/charges and fast retention of In News: Recently, RBI has announced a revised Prompt
customers. Corrective Action (PCA) framework.
o Built with technologies from the cloud.
o Specialised financial systems, such as payments, About Prompt Corrective Action (PCA):
expenditures, receivables, and control of • It is a framework under which banks with weak
expenses. financial metrics are put under watch by the RBI.
o Neo banks also focus on forex cards, credit cards, • The RBI introduced the PCA framework in 2002 as a
cash processing, cost management, corporate structured early-intervention mechanism for
banking services, and loan products globally. banks that become undercapitalised due to poor
• Benefits: asset quality, or vulnerable due to loss of profitability.
o Hassle-free banking services • Aims to check the problem of Non-Performing
o Soothing user interface Assets (NPAs) in the Indian banking sector.
o Innovation-first attitude • It was reviewed in 2017 based on the
o Advanced security level recommendations of the working group of the
o Supporting Clients Financial Stability and Development Council on
Resolution Regimes for Financial Institutions in India
Difference b/w Neo Bank and Traditional Bank: and the Financial Sector Legislative Reforms
Commission.
• Neo-banks are disrupting the traditional banking • Application: The PCA is invoked when certain risk
system by leveraging technology and artificial thresholds are breached. There are three risk
intelligence (AI) to offer a range of personalised thresholds which are based on certain levels of asset
services to customers. quality, profitability, capital and the like.
• While, traditional banks follow an omni-channel • Types of restrictions: Two types of restrictions,
approach i.e. having both physical (through mandatory and discretionary. Restrictions on
branches and ATMs) and digital banking presence to dividend, branch expansion, directors compensation,
offer a multitude of products and services.
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are mandatory while discretionary restrictions could • Depreciation in rupee is a double-edged sword for
include curbs on lending and deposit. the Reserve Bank of India.
• Impact on Bank when PCA triggered: • Positive: While a weaker currency may support
o Banks are not allowed to renew or access costly exports amid a nascent economic recovery from the
deposits or take steps to increase their fee-based pandemic.
income. • Negative: It poses risk of imported inflation, and may
o Banks will also have to launch a special drive to make it difficult for the central bank to maintain
reduce the stock of NPAs and contain generation interest rates at a record low for longer.
of fresh NPAs.
o They will also not be allowed to enter into new Currency Appreciation:
lines of business. RBI will also impose • It is an increase in the value of one currency in
restrictions on the bank on borrowings from the relation to another currency.
interbank market. • Currencies appreciate against each other for a variety
of reasons, including government policy, interest
Revised framework: rates, trade balances and business cycles.
• The revised PCA framework will be effective from • Currency appreciation discourages a country's
January 1, 2022. export activity as its products and services become
• Capital, asset quality and leverage will be the key costlier to buy.
areas for monitoring.
• Indicators to be tracked for capital, asset quality and Currency Depreciation:
leverage would be CRAR/Common Equity Tier I • It is a fall in the value of a currency in a floating
Ratio, Net NPA Ratio and Tier I Leverage Ratio, exchange rate system.
respectively. • Economic fundamentals, political instability, or risk
aversion can cause currency depreciation.
Non-Performing Asset: • Currency depreciation encourages a country's export
• It is a loan or advance for which the principal or activity as its products and services become cheaper
interest payment remains overdue for a period of 90 to buy.
days.
• Banks are required to classify NPAs further into Devaluation:
Substandard, Doubtful and Loss assets. • A devaluation occurs when a country’s central bank
makes a conscious decision to lower its exchange rate
Capital Adequacy Ratio (CAR): in a fixed or semi-fixed exchange rate.
• The CAR is a measure of a bank's available capital • In general, devaluation and depreciation are often
expressed as a percentage of a bank's risk-weighted used interchangeably.
credit exposures. • They both have the same effect – a fall in the value of
• The Capital Adequacy Ratio, also known as capital-to- the currency which makes imports more expensive,
risk weighted assets ratio (CRAR), is used to protect and exports more competitive.
depositors and promote the stability and efficiency of
financial systems around the world. Reasons for Current Depreciation of Indian Rupee:
• Record-High Trade Deficit: India’s trade deficit
DEPRECIATION OF INDIAN RUPEE widened to an all-time high of about $23 billion in
In News: Recently, the Indian currency declined 2.2% in November amid higher imports.
the Sep-Dec 2021 quarter. This depreciation of currency • Policy divergence b/w RBI and Federal Reserve:
is due to global funds worth $4 billion having been pulled The strengthening of USD in line with expectations of
out of the country’s stock market. better growth in the US economy and favourable
interest offered by the Federal Reserve (US Central
About Depreciation: bank).
• Currency depreciation is a fall in the value of a • Outflow of Capital: Foreign capital exodus from
currency in a floating exchange rate system. stocks have led to the benchmark S&P BSE Sensex
• Rupee depreciation means that the rupee has become Index falling by about 10% below an all-time high
less valuable with respect to the dollar. touched in October 2021.
• It means that the rupee is now weaker than what it • Omicron Concerns: When concerns about the
used to be earlier. omicron virus variant are roiling the global markets.
• E.g.: USD 1 used to equal to Rs. 70, now USD 1 is equal
to Rs. 76, implying that the rupee has depreciated SCHEDULE BANK
relative to the dollar i.e. it takes more rupees to In News: Recently, RBI has informed that Airtel
purchase a dollar. Payments Bank Ltd. has been categorized as a Scheduled
• Currently, this downfall of currency makes the Indian Bank.
rupee as Asia’s worst-performing currency.
About Scheduled Banks:
Impact of Depreciation of Indian Rupee:
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OnlyIAS UDAAN PLUS: ECONOMY

• Scheduled Banks refer to those banks which have high from 2014 to 2018. It grew with a growth rate of
been included in the Second Schedule of Reserve 18% during that period.
Bank of India Act, 1934. • Phase II: IL&FS crisis: In September, 2018 crisis in
• Reserve Bank of India (RBI) in turn includes only IL&FS impacted NBFCs and banking sector in India. It
those banks in this Schedule which satisfy the criteria happened due to high NPAs and financial
laid down vide section 42(6)(a) of the said Act. mismanagement. The growth rate of AUM in NBFCs
• Every Scheduled bank enjoys two types of principal dwindled during that period.
facilities: it becomes eligible for debts/loans at the • Phase III: Impact of COVID-19: During Pandemic,
bank rate from the RBI; and, it automatically acquires collapse of economic activities across core sectors of
the membership of clearing house. economy slowed the growth rate of AUM in NBFCs.
• Banks not under this Schedule are called Non-
Scheduled Banks TOKENIZATION
• In News: Recently, RBI has extended the timeline for
Types of Scheduled Banks:
implementation of the new credit and debit card data
1. Scheduled Commercial banks
storage norms, or card-on-file tokenisation (CoF) by
2. Scheduled Co-operative banks
six months to 30th June, 2022.
Scheduled commercial Banks are further divided into
RBI decision:
5 types as below:
• RBI has also extended tokenization of Card-on-File
1. Nationalised Banks
(CoF) transactions where card details are saved by
2. Development Banks
merchants — and directed the merchants not to store
3. Regional Rural Banks
card details in their systems from January 1, 2022.
4. Foreign Banks
• A CoF transaction is one in which a cardholder has
5. Private sector Banks
authorized a merchant to store his or her Mastercard
or Visa payment details, and to bill the stored
Scheduled Co-operative banks are further divided
account.
into 2 types namely:
1. Scheduled State Co-operative banks • E-commerce companies and airlines and
2. Scheduled Urban Co-operative banks supermarket chains often store card details.

Abut Tokenization:
Currently four banks Airtel Payments Bank, Fino
Payments Bank, India Post Payments Bank, Paytm • Tokenization is a process of replacing actual card
Payments Bank have been granted Scheduled bank status. details with a unique alternate code called the ‘token’.
• Sensitive customer data such as card number and
CVV (card verification value) are replaced with an
ASSETS UNDER MANAGE MENT (AUM) algorithmically generated encrypted token.
In News: Recently, credit rating agency CRISIL has • Benefits of Tokenization:
predicted that Asset under management of Non-Banking o Transaction safety: Tokenization reduces the
Financial Companies is expected to grow by 5-6% in next chances of fraud arising from sharing card
fiscal year. details.
o Easy payments: The token is used to perform
About Assets under Management (AUM): contactless card transactions at point-of-sale
• AUM are the total market value of the investments (PoS) terminals and QR code payments.
that a person or entity manages on behalf of clients. o Data storage: Only card networks and card-
• Investments may be in form of securities, debt issuing banks will have access to and can store
instruments etc. which are managed by institutions any card data.
such as NBFCs, Banks, mutual funds and hedge funds. • Transactions Currently Processed: Many players
involved in processing one card transaction today -
Significance: 1. Merchant
• The total value of AUM is a measure of the size of a 2. Payment aggregator
financial institution. 3. Issuing bank
• It also indicates towards financial health of that 4. Card network
financial institutions and size of a financial • When a transaction happens on a merchant platform,
institution. the data is sent to the payment aggregator (PA).
• The larger AUM means higher revenues generated • The PA next sends the details to either the issuing
from assets and thus higher income of financial bank or the card network.
institutions. • Then issuing bank sends an OTP and the transaction
flows back.
Performance of AUM of NBFCs in India:
• Phase I: High Growth Rate: Growth rate of Asset Card-on-File:
Under Management (AUM) of NBFCs was all time

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• A CoF transaction is a transaction where a cardholder Conditions applied:

has authorised a merchant to store the cardholder’s • Payment instruments shall be enabled for offline
Mastercard or Visa payment details. transactions only after the explicit consent of the
• The cardholder then authorises that same merchant customer.
to bill the cardholder’s stored Mastercard or Visa • That apart, these transactions using cards will be
account. allowed without a requirement to turn on the
• E-commerce companies and airlines and contactless transaction channel.
supermarket chains normally store card details in • The customers shall have recourse to the Reserve
their system. Bank – Integrated Ombudsman Scheme, as
applicable, for grievance redressal.
ESG FUNDS • RBI retains the right to stop or modify the operations
of any such payment solution that enables small value
• In News: Recently, it has been reported that the asset
digital payments in offline mode.
size of ESG (Environment, Social and Governance)
• Significance: Today, the active base of digital
Funds has grown nearly five times to Rs 12,300 crore
payment users is around 120 to 150 million
over the last couple of years.
customers but we need solutions for areas where
About ESG Fund: data or internet connectivity is not available, whether
it be in metros or rural areas.
• It's a type of mutual fund. Its investment is often used
synonymously with socially responsible investing or
sustainable investing. FAIR VALUE THROUGH PROFIT AND LOSS
• A mutual fund often seeks a good stock of a company (FVTPL) ACCOUNT
with cash flows, potential earnings, management • In News: Recently, RBI proposed a new investment
quality, the business it works in, competition, etc. category for banks fair value through profit and
• The ESG fund, on the other hand, shortlists loss(FVTPL) account. This is a part of its initiatives to
companies that score high on the environment, social align lenders investment portfolio regulations with
responsibility, and corporate governance before the global accounting standards.
considering financial aspects when selecting a stock
for investment. About
• As a result, the key distinction between ESG funds • Background: The Investment Portfolios of Banks at
and other funds is 'conscience,' i.e. ESG fund focuses present are classified under three categories:
on companies with environmentally friendly o Held to maturity (HTM),
practices, ethical business practices, and an o Held for trading (HFT)
employee-friendly record. o Available for sale (AFS).
• The Securities and Exchange Board of India (SEBI) • FVTPL Account: RBI has proposed a new investment
regulates the fund. category for banks—fair value through profit and loss
(FVTPL) account. The existing held-for-trading (HFT)
OFFLINE SMALL-VALUE E-PAYMENTS category will now come under the FVTPL category.
• HFT category was for debt securities purchased by
• In News: Recently, RBI has come out with the
banks with the intent of selling them within a short
framework for facilitating small-value digital
period of time.
payments in offline mode.
• FVTPL will be the residual category where all
investments that do not qualify for inclusion in HTM
About Offline E-payments:
or AFS shall be categorized.
• Offline digital payment does not require Internet or
• This category can have investments such as
telecom connectivity.
securitisation receipts (SRs), mutual funds, alternate
• Such payments can be carried out face-to-face
investment funds, equity shares, derivatives
(proximity mode) using any channel or
(including those undertaken for hedging), among
instrument like cards, wallets and mobile devices.
others.
• Such transactions would not require an Additional
Factor of Authentication.
• Since the transactions are offline, alerts (by way of
SMS and/or e-mail) will be received by the customer
after a time lag.
• There is a limit of ₹200 per transaction and an overall
limit of ₹2,000 until the balance in the account is
replenished.
• Objective: To promote digital payments in semi-
urban and rural areas, this framework allows offline
payments upto Rs. 200 per transaction, subject to an
overall limit of Rs 2,000.

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7. TAXATION Merchandise Exports from India Scheme (MEIS):

• MEIS was launched with an objective to enhance the
RODTEP SCHEME export of notified goods manufactured in a country.
In News: Recently, the Ministry of Commerce and • It came into effect on 1 April 2015 through the
Industry has announced rates of tax refunds under the Foreign Trade Policy and was in existence till 2020.
Remission of Duties and Taxes on Exported Products • It intended to incentivize exports of goods
(RoDTEP) scheme for 8,555 products for the FY 2021-22 manufactured in India or produced in India.
• The incentives were for goods widely exported from
About the Scheme India, industries producing or manufacturing such
• Announced in 2020 as a replacement for the goods with a view to making Indian exports
Merchandise Export from India Scheme (MEIS), competitive.
which was not compliant with the rules of the World • The MEIS covered almost 5000 goods notified for the
Trade Organisation. purpose of the scheme.
• It would refund to exporters the embedded central,
state and local duties or taxes that were so far not GREEN TAX
being rebated or refunded and were, therefore, In News: Recently, the Centre announced its plans to
placing India’s exports at a disadvantage. impose a "green tax" on older vehicles in a move to
disincentive the use of polluting vehicles and to curb
Key features: pollution in the country.
• To enable zero rating of exports by ensuring domestic
taxes are not exported, all taxes, including those Objective
levied by States and even Gram Panchayats, will be • To levy a “Green Tax” on old vehicles which are
refunded under the scheme. polluting the environment.
• The rebates under RoDTEP is WTO-compliant as per • The policy of deregistration and scrapping of vehicles
legal advice, range from 0.5% to 4.3% of the Free On owned by Government department and PSU, which
Board value of outbound consignments. are above 15 years in age.
• The lowest rate is offered on items like chocolates, • Revenue collected from the Green Tax to be kept in a
toffees and sugar confectionary, while yarns and separate account and used for tackling pollution, and
fibres have been granted the highest rate. for States to set up state of-art facilities for emission
• Steel, pharma and chemicals have not been included monitoring.
under the scheme because their exports have done
well without incentives. Applicability of green tax:
• Transport vehicles older than 8 years could be
Rates: charged Green Tax at the time of renewal of fitness
• The tax refund rates range from 0.5% to 4.3% for certificate, at the rate of 10 to 25 % of road tax
various sectors. • Personal vehicles to be charged Green Tax at the time
• The rebate will have to be claimed as a percentage of of renewal of Registration Certification after 15 years.
the Freight On Board value of exports. • Public transport vehicles, such as city buses, to be
• Issuance: Rebates will be issued in the form of a charged lower Green tax.
transferable duty credit/electronic scrip (e-scrip) • Higher Green tax (50% of Road Tax) for vehicles
which will be maintained in an electronic ledger by being registered in highly polluted cities.
the Central Board of Indirect Taxes and Customs • Differential tax, depending on fuel (petrol/diesel)
(CBIC). and type of vehicle.

Significance: Exemptions:
• Enhance India’s Competitiveness • Vehicles like strong hybrids, electric vehicles and
• Par with International Standards alternate fuels like CNG, ethanol, LPG etc.
• Automated Tax Assessment • Vehicles used in farming, such as tractor, harvester,
tiller etc.
Freight on Board
• Also known as Free on Board (FOB) is a term used Benefit:
to indicate who is liable for goods damaged or • To dissuade people from using vehicles which
destroyed during shipping. damage the environment.
• "FOB origin" means the buyer is at risk and takes • To motivate people to switch to newer, less polluting
ownership of goods once the seller ships the product. vehicles.
• "FOB destination" means the seller retains the risk of • Reduce the pollution level, and make the polluter pay
loss until the goods reach the buyer. for pollution.
• The terms of FOB affect the buyer's inventory cost;
adding liability for shipped goods increases
inventory costs and reduces net income.
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OnlyIAS UDAAN PLUS: ECONOMY

CESS AND SURCHARGE o Authorities calculate cess on the surcharge and

the total tax.
In News: Recently, as per a report the share of cess and
o Cess is levied on everyone.
surcharge in the gross tax revenue (GTR) of the Centre
o Cess is used for a specific purpose only, it cannot
has almost doubled to 9% in 2020-21 from 10.4% in
be used for any other reason.
2011-12, leading to the 15th Finance Commission (FC)
o Cess is aimed at public welfare
recommending a higher grant-in-aid and lower tax
• Surcharge:
devolution to the States.
o The surcharge rate varies as per the brackets in
which the people fall.
Cess:
o A surcharge is calculated on the total tax amount
• It is a tax on tax in basic terms.
only.
• A cess must only be applied to the purpose for
o Only higher income brackets face Surcharge.
which it is levied. E.g.: the Indian government
o The surcharge can be used for any reason that the
collects an education cess and uses it solely for that
government finds fit.
reason, namely, education.
o Surcharge aims to tax high earning individuals.
• This tax is imposed on all taxpayers.
• Paid to the Consolidated Fund of India.
GLOBAL MINIMUM CORPORATE INCOME TAX
• Generally expected to be charged until the
government has sufficient purpose and becomes In News: Recently, the Organisation for Economic
dormant after the purpose is fulfilled. Cooperation and Development (OECD) has announced
• A cess is different from other taxes such as excise that a global deal to ensure big companies pay a Global
duty and income tax as it is levied in addition to the Minimum Tax (GMT) rate of 15% has been agreed by 136
current tax (tax on tax). countries (including India).
• Types of Cess:
o Infrastructure Cess About GMT:
o Krishi Kalyan Cess • Objective: GMT is tailored to address the low
o Cess on Exports effective rates of tax shelled out by some of the
o Road and Infrastructure Cess world’s biggest corporations, including Big Tech
o Duty on Tobacco and Tobacco Products majors such as Apple, Alphabet and Facebook.
o Health and Education Cess on Income Tax • Proposed Two Pillar Solution: The global minimum
o Swachh Bharat Cess tax rate would apply to overseas profits of
o Education Cess multinational firms with $868 million in sales
o Cess on Crude Oil globally.
• Current Cess in place: Education cess, road cess, 1. Pillar 1 (Minimum tax and subject to tax
infrastructure cess, clean energy cess, Krishi Kalyan rules): Governments could still set whatever
cess, and swachh bharat cess local corporate tax rate they want, but if
companies pay lower rates in a particular
Surcharge: country, their home governments could “top up”
• Surcharge is a charge on any tax, charged on the tax their taxes to the 15% minimum, eliminating the
already paid. As the name suggests, surcharge is an advantage of shifting profits.
additional charge or tax. 2. Pillar 2 (Reallocation of additional share of
• Individual Taxpayers with more than the annual profit to the market jurisdictions): Allows
income of Rs 1 Crore have to pay 15% of their tax countries where revenues are earned to tax 25%
liabilities separately in the form of a surcharge. of the largest multinationals’ so-called excess
• Similarly, in case of a company, taxpayers with an profit – defined as profit in excess of 10% of
annual net profit of Rs 1 Crore, 7.5% surcharge revenue.
applies on their tax liabilities separately in the form • Timeline: The agreement calls for countries to bring
of a surcharge. it into law in 2022 so that it can take effect by 2023.
• Occasionally, the surcharge is also levied on a certain • Impact: The minimum tax and other provisions aim
amount of expenditure. It applies in the form of a to put an end to decades of tax competition between
percentage on the amount of expenditure. governments to attract foreign investment.

Similarities Between Cess and Surcharge: Reason behind GMT:

• Both a cess and a surcharge are levied by the central • Major economies are aiming to discourage
government. multinationals from shifting profits and tax revenues
• Both are collected and deposited in India's to low-tax countries regardless of where their sales
Consolidated Fund. are made.
• None of these can be shared by state governments. • Increasingly, income from intangible sources such as
drug patents, software and royalties on intellectual
Difference between Cess and Surcharge: property has migrated to these jurisdictions, allowing
companies to avoid paying higher taxes in their
• Cess:
o Cess Rate is Fixed. traditional home countries.

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OnlyIAS UDAAN PLUS: ECONOMY

• Increasingly, income from intangible sources such as loss account or at the usual corporate rates, and
drug patents, software and royalties on intellectual whichever is higher is payable as tax.
property has migrated to these jurisdictions. • All companies in India, whether domestic or
• This has allowed companies to avoid paying higher foreign, fall under this provision.
taxes in their traditional home countries.
• The minimum tax and other provisions aim to put an Organisation for Economic Cooperation and
end to decades of tax competition between Development (OECD)
governments to attract foreign investment. • The OECD is an intergovernmental economic
organisation, founded to stimulate economic
Targets: progress and world trade.
• The proposals are tailored to address the low • Founded: 1961.
effective rates of tax shelled out by some of the • Headquarters: Paris, France.
world’s biggest corporations, including Big Tech • Total Members: 36.
majors such as Apple, Alphabet and Facebook, as well • India is not a member, but a key economic partner.
as those such as Nike and Starbucks.
• These companies typically rely on complex webs of TAX INSPECTORS WITHOUT BORDERS
subsidiaries to hoover profits out of major markets
In News: Recently, Tax Inspectors Without Borders
into low-tax countries such as Ireland, the British
(TIWB) launched its programme in Seychelles. India was
Virgin Islands, the Bahamas, or Panama.
chosen as the Partner Administration and has provided a
Tax Expert for this programme.
Loss:
• The US loses nearly $50 billion a year to tax cheats,
About the Programme:
according to the Tax Justice Network report, with
• The programme is expected to be of 12 months
Germany and France also among the top losers.
duration.
• India’s annual loss due to corporate tax abuse is
• In this duration, India will collaborate with the TIWB
estimated at over $10 billion.
Secretariat and the UNDP Country Office in Mauritius
Working of tax deal: and Seychelles.
• Applicable to: To overseas profits of multinational • Aim: to aid Seychelles in strengthening its tax
firms with 750 million euros ($868 million) in sales administration by transferring technical know-how
globally. and skills to its tax auditors through sharing of best
audit practices.
• Local Tax Valid: Governments could still set
whatever local corporate tax rate they want, but if • Focus: On Transfer Pricing cases of tourism and
companies pay lower rates in a particular country, financial services sectors.
their home governments could “top up” their taxes to
Benefits of the programme:
the 15% minimum, eliminating the advantage of
shifting profits. • Through this India in collaboration with the UNDP
and the TIWB Secretariat aims to aid Seychelles in
• Excess Profit: A second track of the overhaul would
allow countries where revenues are earned to tax strengthening its tax administration by transferring
25% of the largest multinationals’ so-called excess technical know-how and skills to its tax auditors, and
through sharing of best audit practices.
profit – defined as profit in excess of 10% of revenue.

Minimum Alternate Tax (MAT): About TIWB Programme:

• Due to an increase in the number of zero tax paying • It is a joint initiative of the United Nations
companies, Minimum Alternate Tax (MAT) was Development Programme (UNDP) and the
introduced by the Finance Act, 1987 with effect from Organisation for Economic Cooperation and
assessment year 1988-89. Development (OECD).
• Later on, it was withdrawn by the Finance Act, 1990 • Launched in July 2015.
and then reintroduced by Finance Act, 1996. • Aim: To strengthen developing countries' auditing
capacity and multinationals' compliance worldwide.
• MAT was later extended to cover non-corporate
entities as well. MAT is an important tool with which
tax avoidance can be prevented. Modus Operandi:
• At times it may happen that a taxpayer, being a • It deploys qualified experts in developing countries
company, may have generated income during the across Africa, Asia, Eastern Europe, Latin America
year, but by taking the advantage of various and the Caribbean.
provisions of Income-tax Law like exemptions, • They train the local countries’ personnel in fields
deductions, depreciation, etc., it may have reduced its of:
tax liability or may not have paid any tax at all. o Tax capacity and audits,
o Criminal tax investigations,
• As of Jan 2022, MAT is calculated at 15% on the
book profit that the profit shown in the profit and o The effective use of automatically exchanged
information.

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• TIWB assistance has led to increased domestic THE TAXATION LAWS (AMENDMENT) BILL, 2021
resource mobilisation in some of the least developed
In News: Recently, the Union government finally
countries in the world.
withdrew the Income-tax Act and Finance Act, 2012 by
introducing an amendment bill.
Transfer Pricing:
• In taxation and accounting, transfer pricing refers to About the Bill
• the rules and methods for pricing transactions within • Amendments to the Income-tax Act and Finance Act,
and between enterprises under common ownership 2012 to effectively state that no tax demand shall be
or control. raised for any indirect transfer of Indian assets if the
• E.g. an e-commerce giant ‘X India Ltd’ will try to buy transaction was undertaken before 28th May 2012.
keyboards from ‘X USA Ltd’ at higher prices than the
• Tax raised for the indirect transfer of Indian assets
market rate in order to shift its profit margin to the before May 2012 would be "nullified on fulfillment of
USA. specified conditions" such as the withdrawal of
• Thus, the tax burden for ‘X India Ltd’ will reduce and pending litigation and an undertaking that no
the profitability of the parent company ‘X USA Ltd will damages claims would be filed.
increase’.
• It also proposes to refund the amount paid by
• They are active tools used by many MNCs to avoid or companies facing trail in these cases without interest
evade tax by shrinking the profit margins. thereon.
Few mechanisms to curb it: Aims to:
• Advance Transfer Pricing Agreements 1. Amend the Income Tax Act, 1961, and the Finance
• Minimum percentage of revenue as tax Act, 2012.
• Close scrutiny by setting market prices as a 2. Prevent the income tax department from raising tax
benchmark. demands retrospectively.

REBATE OF STATE AND CENTRAL TAXES AND Eligibility:

LEVIES (ROSCTL) SCHEME • To be eligible, the concerned taxpayers would have to
In News: Recently, it has been reported that Garment drop all pending cases against the government and
exporters will continue to get a rebate on central and state promise not to make any demands for damages or
taxes on their outward shipments as the government costs.
approved extension of RoSCTL scheme till March 2024.
Retrospective Taxation
About RoSCTL Scheme: • It allows a country to pass a rule on taxing certain
• Notified by the Ministry of Textiles in 2019. products, items or services and deals and charge
• Under this scheme, the exporters are issued a Duty companies from a time behind the date on which the
Credit Scrip for the value of embedded taxes and law is passed.
levies contained in the exported product. • Countries use this route to correct any anomalies in
• Exporters can use this scrip to pay basic Customs their taxation policies that have, in the past, allowed
duty for the import of equipment, machinery or any companies to take advantage of such loopholes.
other input. • Retrospective Taxation hurts companies that had
• The scheme would continue till March 31, 2024. knowingly or unknowingly interpreted the tax rules
• Revised guidelines for continuation and differently.
implementation of the RoSCTL scheme shall be • Apart from India, many countries including the USA,
prepared by the Ministry of Textiles in consultation the UK, the Netherlands, Canada, Belgium, Australia
with the Department of Revenue with necessary and Italy have retrospectively taxed companies.
flexibilities to fine-tune the operational details,
implementation modalities and scheduling etc. Implications of Retrospective taxation laws
• Retrospective amendments militate against the
Benefits: principle of tax certainty and damage India’s
• The continuation of the RoSCTL will make Indian reputation as an attractive destination.
garments, apparels, and made ups competitive in the • India has recently suffered various humiliations in
international market and is expected to result in a international arbitration while challenging tax
10% growth in export of these products this year. demands made under the retrospective clause.
• Annual apparel and made ups exports are worth
about $22 billion. It will ensure a stable and Significance of the move:
predictable policy regime and provide a level playing • The move attempts to end long-pending disputes
field to Indian textiles exporters. with foreign firms such as Vodafone Plc.
• It will promote startups and entrepreneurs to export • The move is also investor-friendly, and also brings to
and ensure creation of lakhs of jobs. an end messy litigation and arbitration, especially
with Cairn, which has seen the company staking claim
to India’s overseas assets.
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(API) based machine to machine communication or

8. PUBLIC FINANCE integration, as appropriate.

INTERNATIONAL FINANCIAL SERVICES CENTRES OFF BUDGET BORROWINGS

AUTHORITY (IFSCA) In News: Recently, CAG flags Kerala’s Kerala
• In News: Recently, International Financial Services Infrastructure Investment Fund Board (KIIFB) for critical
Centres Authority (IFSCA) issued a Request For infra projects have bypassed the limits set on government
Proposal (RFP) for Supervisory Technology borrowings
(SupTech) System.
About ‘Off-Budget Borrowings’:
About IFSCA • Off-budget borrowings are loans that are taken not
• It was established as a statutory authority on by the Centre directly, but by another public
April 27, 2020, under the International Financial institution which borrows on the directions of the
Services Centres Authority Act, 2019. central government.
• It has been established at GIFT-IFSC, Gandhinagar, • Such borrowings are used to fulfil the government’s
Gujarat. expenditure needs.
• It is a unified authority for the development and • But since the liability of the loan is not formally on the
regulation of financial products, financial services Centre, the loan is not included in the national
and financial institutions in the International fiscal deficit.
Financial Services Centre (IFSC) in India. • This helps keep the country’s fiscal deficit within
• At present, the GIFT IFSC is the maiden international acceptable limits.
financial services centre in India.
Off Budget Borrowings raised by:
International Financial Service Centre: • The government can ask an implementing agency to
• An IFSC enables bringing back the financial services raise the required funds from the market through
and transactions that are currently carried out in loans or by issuing bonds.
offshore financial centres by Indian corporate • Other public sector undertakings have also borrows
entities and overseas branches/subsidiaries of for the government.
Financial Institutions (such as banks, insurance • Public sector banks are also used to fund off-budget
companies, etc.) to India. expenses.
• It offers a business and regulatory environment that
is comparable to other leading international financial Fiscal Deficit
centres in the world like London and Singapore. • The government describes fiscal deficit of India as
• IFSCs are intended to provide Indian corporates with “the excess of total disbursements from the
easier access to global financial markets and to Consolidated Fund of India, excluding repayment
complement and promote further development of of the debt, over total receipts into the Fund
financial markets in India. (excluding the debt receipts) during a financial
• The first IFSC in India has been set up at theGujarat year”.
International Finance Tec-City (GIFT City) in • In simple words, it is a shortfall in a government's
Gandhinagar. income compared with its spending.
• Fiscal Deficit = Total expenditure of the government
Composition: (capital and revenue expenditure) – Total income of
• Chairperson the government (Revenue receipts + recovery of
• 1 member from RBI loans + ot her receipts).
• 1 member from SEBI
• 1 member from PFRDA Provisions of Borrowings under Constitution:
• 1 member from IRDAI • Borrowing by Centre and the States: Chapter II in
• 2 members from the Finance Ministry Part XII of the Constitution of India deals with
• 2 members appointed on recommendation of a borrowing. Article 292 covers borrowing by the
Selection Committee Central Government, and Article 293 covers
borrowing by States.
Supervisory technology: • Empowering State Legislatures: Article 293(1)
• Supervisory technology (suptech) is the use of provides State legislatures the power by law to
innovative technology by supervisory agencies to enable or limit the State’s executive powers of
support supervision. borrowing and giving guarantees.
• The SupTech system shall cover administrative, • Consent of the Centre: Under clauses (3) and (4) of
compliance, supervision, and enforcement Article 293, State Governments need to obtain the
framework for its regulated entities. consent of the Centre for raising fresh loans in case
• The SupTech system will enable IFSCA to collaborate they are indebted to the latter, and such consent may
with other sectoral financial regulators in India and be granted subject to conditions.
abroad through Application Programming Interface
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OnlyIAS UDAAN PLUS: ECONOMY

PRADHAN MANTRI MUDRA YOJANA 9. EXTERNAL SECTOR OF INDIA

In News: Recently, it has been reported that Public
Sector banks are experiencing a sharp surge in the
proportion of Mudra loans turning into non-performing TRADE POLICY REVIEW MECHANISM
assets (NPAs). In News: Recently, the second and final session of India’s
7th Trade Policy Review (TPR) has been concluded at the
About Pradhan Mantri Mudra Yojana (PMMY): World Trade Organization (WTO) in Geneva.
• It was launched by the government in 2015 for
providing loans up to Rs. 10 lakh to the non- Trade Policy Review (TPR):
corporate, non-farm small/micro-enterprises. • The TPR is an important mechanism under the WTO’s
• Funding Provision: monitoring function and involves a comprehensive
o MUDRA, which stands for Micro Units peer-review of the Member’s national trade policies.
Development & Refinance Agency Ltd., is a • India’s last TPR took place in 2015.
financial institution set up by the Government.
o It provides funding to the non-corporate small Objective:
business sector through various last-mile • To increase the transparency and understanding of
financial institutions like Banks, Non-Banking countries’ trade policies and practices, through
Financial Companies (NBFCs) and Micro Finance regular monitoring
Institutions (MFIs). • To improve the quality of public and
o MUDRA does not lend directly to micro- intergovernmental debate on the issues
entrepreneurs/individuals. • To enable a multilateral assessment of the effects of
• Three Products: policies on the world trading system
1. Shishu: Covering loans up to Rs. 50,000.
2. Kishore: Covering loans above Rs. 50,000 and up India’s Progress:
to Rs. 5 lakh. • Introduction of Goods & Services Tax in 2016.
3. Tarun: Covering loans above Rs. 5 lakh and up to • India’s efforts in the implementation of WTO’s Trade
Rs. 10 lakh. Facilitation Agreement.
• Loans under this scheme are collateral-free loans. • Role played by India in furthering “Ease of Doing
Business” in the country.
Achievements: • India’s improved ranking in “Trading across Borders”
• Loans to disadvantaged sections of society: indicator under the Ease of Doing Business Report.
Women entrepreneurs, SC/ST/OBC, Minorities etc • Trade Facilitation Agreement (TFA), aims to speed up
are key beneficiaries. customs procedures and make trade easier, faster,
• Boost to Atma Nirbhar Bharat and Make in India: The and cheaper.
focus has also been on new entrepreneurs. • The steps taken by India for liberalizing its Foreign
• Employment Generation: Direct Investment (FDI) regime and India’s National
o As per a survey conducted by the Ministry of Intellectual Property Rights Policy, 2016.
Labour and Employment, PMMY helped in
generating 1.12 crore net additional employment ANTI-DUMPING DUTY
from 2015 to 2018.
o Out of the 1.12 crore of estimated increase in In News: Recently, India has initiated an anti-dumping
employment, women accounted for 69 lakh probe against imports of a certain type of tiles, used for
(62%) covering the floors in residential and commercial
buildings, from China, Taiwan and Vietnam following a
Non-Performing Asset (NPA): complaint by domestic players.
• NPAs are loans or advances made by a financial
Dumping
institution, on which both principal or interest is
unpaid for a specified period of time. • Dumping is a process wherein a company exports a
product at a price that is significantly lower than the
• Thus, NPAs are those loans that have ceased to
price it normally charges in its home (or its domestic)
generate income for the bank.
market.
Types of NPA: • This is an unfair trade practice which can have a
distortive effect on international trade.
• Sub Standard: A sub-standard asset is one that is
classified as an NPA for a period not exceeding twelve • Anti-dumping is a measure to rectify the situation
months. arising out of the dumping of goods and its trade
distortive effect.
• Doubtful: A doubtful asset is one that has remained
as an NPA for a period exceeding twelve months.
Anti-Dumping Duty:
• Loss: A loss asset is one where loss has already been
• An anti-dumping duty is a protectionist tariff that a
identified by the bank or an external institution, but
domestic government imposes on foreign imports
it is not yet completely written off, due to its recovery
that it believes are priced below fair market value.
value, however little it may be.
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OnlyIAS UDAAN PLUS: ECONOMY

• In order to protect their respective economy, many • The state governments may be advised to offer a
countries impose duties on products they believe are road-tax rebate of up to 25% for personal vehicles
being dumped in their national market. and up to 15% for commercial vehicles to provide
• In fact, anti-dumping is an instrument for ensuring incentive to owners of old vehicles to scrap old and
fair trade and is not a measure of protection per se for unfit vehicles.
the domestic industry. • Aim: Reducing the population of old and defective
• Such ‘dumped’ products have the potential to vehicles, bringing down vehicular air pollutants,
undercut local businesses and the local economy. improving road and vehicular safety.
• Anti-dumping duties provide relief to the domestic • Provisions:
industry against the injury caused by dumping. o Fitness Test: Old vehicles will have to pass a
fitness test before re-registration and as per the
WTO and Anti-Dumping Duties: policy government commercial vehicles more
• The WTO operates a set of international trade rules, than 15 years old and private vehicles which are
including the international regulation of anti- over 20 years old will be scrapped.
dumping measures. o Road Tax Rebate: The state governments may
• It does NOT intervene in the activities of companies be advised to offer a road-tax rebate of up to 25%
engaged in dumping. for personal vehicles and up to 15% for
• Instead, it focuses on how governments can—or commercial vehicles to provide incentive to
cannot—react to the practice of dumping. owners of old vehicles to scrap old and unfit
• In general, the WTO agreement permits governments vehicles.
to act against dumping if it causes or threatens o Vehicle Discount: Vehicle manufacturers will
material injury to an established domestic industry. also give a discount of 5% to people who will
produce the 'Scrapping Certificate' and
Indian Mechanism: registration fees will be waived off on the
• The Department of Commerce recommends the purchase of a new vehicle.
anti-dumping duty, provisional or final. o Disincentive: As a disincentive, increased re-
• The Department of Revenue in Finance Ministry registration fees would be applicable for vehicles
acts upon the recommendation within three 15 years or older from the initial date
months and imposes such duties. registration.

Difference b/w Anti-dumping duty and Various Government Initiatives to Curb Vehicular
Countervailing Duties: Pollution:
• Anti-dumping duty is different from countervailing • Go Electric Campaign
duty. The latter is imposed in order to counter the • FAME India Scheme Phase II.
negative impact of import subsidies to protect • Electric Vehicles (EV) Policy 2020 for Delhi.
domestic producers. • Hydrogen Fuel Cell Based Bus and Car Project.
• Countervailing Duties (CVDs) are tariffs levied on • National Electric Mobility Mission 2020.
imported goods to offset subsidies made to producers
of these goods in the exporting country. PRORIISE SOFTWARE
• CVDs are meant to level the playing field between In News: Recently, Indian Institute of Science, Bengaluru,
domestic producers of a product and foreign (IISc) and Prorigo Software Pvt. Ltd. jointly developed the
producers of the same product who can afford to sell ProrIISe Software.
it at a lower price because of the subsidy they receive
from their government. About ProrIISe Software:
• Objective: To automate the legal and bureaucratic
VEHICLE SCRAPPING POLICY part of the patent process.
In News: Recently, the Prime Minister while addressing • It will be helpful for registering intellectual property
the Investor Summit in Gujarat via video conferencing developed by Indian academicians.
launched the Vehicle Scrapping Policy/National • Benefits: This software is available at a lesser cost
Automobile Scrappage Policy. when compared to the software available outside
India. Earlier the only choice available was outside
About the Vehicle Scrappage Policy: software products.
• Old vehicles will have to pass a fitness test before re- • Version 2.0 of the software will automate the
registration and as per the policy government financial part too.
commercial vehicles more than 15 years old and • Version 3.0 may release in 2022. It will bring out
private vehicles which are over 20 years old will be artificial intelligence approaches to processes
scrapped. required to evaluate a patent.
• As a disincentive, increased re-registration fees
would be applicable for vehicles 15 years or older Intellectual Property Rights (IPR):
from the initial date registration.

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• IPR are the rights given to persons over the creations PATENTS (AMENDMENT) RULES, 2021
of their minds: inventions, literary and artistic works,
In News: Recently, the union government has introduced
and symbols, names, and images used in commerce.
Patents (Amendment) Rules, 2021 which has reduced the
• The importance of intellectual property was first fee for patent filing and prosecution for educational
recognized in the Paris Convention for the Protection institutions by 80%.
of Industrial Property (1883).
• Later it was also recognized in the Berne Convention About Patents:
for the Protection of Literary and Artistic Works
• A patent is a form of preservation of intellectual
(1886). The World Intellectual Property Organization property.
(WIPO) administers both treaties.
• Patents are territorial rights.
• It is an exclusive right granted for an invention, which
Patent
is a product or a process that provides, in general, a
• Patents are exclusive rights granted by the
new way of doing something, or offers a new
Government to a company /individual for an
technical solution to a problem.
invention.
• To get a patent, technical information about the
• Patents are time-bound. For example: In India
invention must be disclosed to the public in a patent
patents are granted for a period of 20 years from the
application.
date of filing of the patent application.
Patentability Criteria for an Invention:
GOLD HALLMARKING • It should be novel.
In News: Recently, the Government has made it • Must involve an inventive step (technical
mandatory for the introduction of a Hallmark Unique advancement)
Identification (HUID) number in every piece of jewellery. • Capable of industrial application
• Term of Patent: The term of every patent in India is
About Hallmark Unique Identification (HUID) twenty years from the date of filing the patent
• HUID is a six-digit alphanumeric code, or one that application, irrespective of whether it is filed with
consists of numbers and letters. It is given to every provisional or complete specification.
piece of jewellery at the time of hallmarking and is • Patents Act, 1970 : This principal law for patenting
unique for each piece. system in India came into force in the year 1972. It
• It is being implemented by the Bureau of Indian replaced the Indian Patents and Designs Act 1911.
Standards (BIS) in a phased manner.
• Hallmarking & HUID are mandatory for 14, 18 and Patents (Amendment) Rules, 2021
22 carat gold jewellery and artefacts. • Patent Fees for Educational Institutions has been
• Before buying any piece of gold jewellery, the buyer reduced drastically by 80%.
should check all these three symbols. • Expedited Examination System: the facility of
• Implementation: Expedited Examination system extended to 8 more
o Symbols: The hallmark consists of three symbols categories of Patent Applicants-
which give some information about the jewellery o SME (Small and Medium Enterprises),
piece. The first symbol is the BIS logo; the second o Female applicants,
indicates purity and fineness; and the third o Government Departments,
symbol is the HUID. o Institutions established by a Central,
o A&H centre: Jewellery is stamped with the o Institutions established by a Provincial or State
unique number manually at the Assaying & Act,
Hallmarking centre. o Government Company,
• Significance: o an institution wholly or substantially financed by
o Authentication: HUID gives a distinct identity to the Government and
each piece of jewellery enabling traceability. o Applicants under Patents Prosecution Highway.
o Credibility: It is critical to the credibility of • It will make the process of applying and granting
hallmarking and to help address complaints patents completely online.
against adulteration. • Scheme for Facilitating Startups Intellectual
o Registration: In HUID-based hallmarking, Property Protection (SIPP): launched to provide
registration of jewellers is an automatic process facilitators to Startups for filing and processing of
with no human interference. their applications.
o Prevents malpractice: It also helps check • Feedback/ Complaint Mechanism
malpractice by members of the trade. • Awareness activities in IPR
o Data privacy: It is a secure system and poses no
risk to data privacy and security. Patent Prosecution Highway (PPH): It is a set of
o Financial tracking: HUID provides traceability initiatives for providing accelerated patent prosecution
and financial tracking of purchases. procedures by sharing information between some patent
offices.

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ESSENTIAL COMMODITIES ACT 1955 • State Government must set up a mechanism to

monitor or supervise the activities of direct sellers
• In News: Recently, Government of India has declared
and direct selling entities.
Soya Meal as an Essential Commodity till 30th June,
• Direct selling entities will be liable for the grievances
2022 under the Essential Commodities Act 1955.
arising out of the sale of goods or services by its direct
sellers.
About Essential Commodities Act 1955:
• Essential Commodities Act,1955 was enacted to
Consumer Protection (e-Commerce) Rules, 2020:
ensure the easy availability of essential
• The Consumer Protection (E-commerce) Rules, 2020
commodities to consumers and to protect them
are mandatory and are not advisories.
from exploitation by unscrupulous traders.
• Applicability: Apply to all e-commerce retailers,
• There is no specific definition of essential
whether registered in India or abroad, offering goods
commodities in The EC Act. Section 2(A) of the act
and services to Indian consumers.
states that an “essential commodity” means a
commodity specified in the “Schedule” of this Act. • Nodal officer: E-commerce entities need to appoint
a nodal person, resident in India to ensure
• The Act gives powers to the central government to
compliance with the provisions of the act or rules.
add or remove a commodity in the “Schedule”. The
Centre, if it is satisfied that it is necessary to do so in • Prices and Expiry Dates:
public interest, can notify an item as essential, in o The sellers through the e-commerce entities will
consultation with state governments. have to display the total price of goods and
services offered for sale along with the break-up
• By declaring a commodity as essential, the
of other charges.
government can control the production, supply, and
o Expiry date of the good needs to be separately
distribution of that commodity, and impose a stock
displayed.
limit.

Soyabean and Soya Meal: ELECTRONIC GOLD RECEIPTS

• It is one of the fastest growing crops in India. • In News: Recently, the Government of India has
Soyabean is grown as a Kharif Crop in India. notified the Securities and Exchange Board of India
• It is an oilseed produced for extracting edible oils. (Vault Manager) Regulations, 2021 for issuance of
• Soyabean is mostly grown in Madhya Pradesh and 'Electronic Gold Receipt' (EGR).
Maharashtra. These two states together produce
about 90 per cent of total output of soyabean in the About Electronic Gold Receipts:
country • These are electronic receipts issued on the basis of a
• Feed shortage Soyabean meal is a key feed material deposit of underlying physical gold.
for fish, shrimp, cattle, dairy and poultry farmers. • This would pave the way for the operationalization of
Shortage in feed availability has resuled in a surge in a gold exchange in India.
soymeal prices that is hurting livestock farmers, the
industry Gold Exchange:
• In the US, soymeal is available at around $550 a • Gold Exchange would be a national platform for
tonne, while domestic prices in India are more than buying and selling EGRs issued against physical gold.
twice the rate. Investors can trade in EGRs on stock exchanges and
the proposed gold exchange.
CONSUMER PROTECTION (DIRECT SELLING) • The transaction in a gold exchange has been divided
RULES,2021 into three parts
1. Conversion of physical gold into EGR,
• In News: Recently, the Centre has notified Consumer
2. Trading of EGR on a stock exchange
Protection (Direct Selling) Rules, 2021 for the direct
3. Conversion of EGR into physical gold.
selling industry.
• Regulated by: SEBI would regulate the entire
ecosystem of the proposed gold exchange. It would be
About the Rules:
the sole regulator for the exchange, including for
• These Rules shall apply to all goods and services
vaulting, assaying gold quality and fixing delivery
bought or sold through direct selling.
standards.
• These Rules shall also apply to a direct selling entity
• Features:
which is not established in India, but offers goods or
o Stock exchanges can launch contracts of different
services to consumers in India.
denominations for trading and conversion of
• Existing direct selling entities need to comply of these
EGR into gold.
rules within ninety days from the date of publication
o SEBI has brought in fungibility and
of these rules in the Official Gazette.
interoperability between vault managers for the
• The direct sellers as well as the direct selling entities ease of investors.
using e-commerce platforms for sale shall comply o An EGR will not be linked with a unique bar
with the requirements of the Consumer Protection reference number of the physical gold.
(e-Commerce) Rules, 2020.

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OnlyIAS UDAAN PLUS: ECONOMY

o Physical gold deposited at one location can be

withdrawn from a different location of any vault 10. HUMAN DEVELOPMENT AND
manager. SUSTAINABLE DEVELOPMENT

EMPLOYEE PROVIDENT FUND (EPF) SCHEME

In News: Recently, the government has proposed to make
the interest earned on EPF contributions beyond ₹2.5
lakh Taxable.

About EPF
• It is a social security scheme under the Employees’
Provident Funds and Miscellaneous Provisions
Act, 1952.
• Managed by: The scheme is managed under the aegis
of Employees’ Provident Fund Organization (EPFO).
• Coverage: EPF accounts are mandatory for
employees earning up to ₹15,000 a month in firms
with over 20 workers.
• Contribution: Under the scheme, an employee has to
pay a 12% contribution towards the scheme. An
equal contribution is paid by the employer. The
employee gets a lump sum amount including self and
employer’s contribution with interest on both on
retirement.
• Limit on Employer’s Contribution: In Budget 2020,
the government had capped the contributions by
employers into funds EPF or the National Pension
Scheme at ₹7.5 lakh a year.
• The government, as well as private-sector
employees, are allowed to make voluntary
contributions over and above the statutory
deductions into the general provident fund(GPF) or
EPF respectively.
• This savings scheme offers tax exemption under
Section 80C of the Income Tax Act.

Employees’ Provident Fund Organisation (EPFO)

• It is a government organization that manages
provident fund and pension accounts of member
employees and implements the Employees’
Provident Fund and Miscellaneous Provisions Act,
1952 which is applicable to whole of India with
exemption given only to Jammu & Kashmir.
• Administered by the Ministry of Labour &
Employment, Government of India.
• It is one of the World's largest Social Security
Organisations in terms of clientele and the volume of
financial transactions undertaken.

CONSUMER WELFARE FUND

In News: Recently, during the ongoing session the Union
Minister of State for Consumer Affairs, Food and Public
Distribution has informed the parliament about
Consumer Welfare Fund (CWF).

About Consumer Welfare Fund:

• Set up under the Central Goods and Services Tax
(CGST) Act, 2017. The consumer welfare fund rules of
1992 have been subsumed under the CGST rules,
2017.

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OnlyIAS UDAAN PLUS: ECONOMY

• The Fund has been set up by the Department of • Skills Acquisition and Knowledge Awareness for
Revenue (Ministry of Finance) and is being operated Livelihood Promotion (SANKALP) is a World Bank
by the Department of Consumer Affairs (Ministry of loan assisted programme.
Consumer Affairs, Food & Public Distribution). • Objective: To strengthen the district skill
• Objective: To promote and protect the welfare of the administration and the District Skill Committees
consumers. (DSCs).
• Examples: • It is a two-year academic programme.
o Creation of Consumer Law Chairs/ Centres of • It comes with an in-built component of on-ground
Excellence in Institutions/Universities of repute practical experience with the district administration.
to foster research and training on consumer • It will also support the Training of Trainer (ToT)
related issues. system in Public-Private Partnership (PPP) mode.
o Projects for spreading consumer literacy and • MSDE has instituted the “Awards for Excellence in
awareness. District Skill Development Planning (DSDP
Awards)” under SANKALP in 2018.
ATAL BHUJAL YOJANA • Four key result areas have been identified:
In News: Recently, the Minister of State for Jal Shakti & 1. Institutional Strengthening (at National, State &
Social Justice and Empowerment has given the District level)
information regarding the status of Atal Bhujal Yojana 2. Quality Assurance Quality Assurance of skill
(Atal Jal). development programs;
3. Inclusion of marginalised population in skill
About Atal Bhujal Yojana: development
• It is a Rs.6000 crore World Bank approved Central 4. Expanding Skills through Public Private
Sector Scheme of the Ministry of Jal Shakti. Partnerships (PPPs).
• Funding: The funding pattern is 50:50 between
Government of India and World Bank. CENTRAL EMPLOYMENT GUARANTEE COUNCIL
• Aims: to improve ground water management in In News: Recently, the 23rd Meeting of the Central
priority areas in the country through community Employment Guarantee Council was held under the
participation. Chairmanship of Union Minister of Rural Development.
• Scheme envisages:
o Community participation e.g. “formation of About Central Employment Guarantee Council:
Water User Associations”. • The Central Council has been constituted under
o Monitoring and dissemination of data. Section 10 of the MGNREGA.
o Water budgeting. • It is chaired by the Minister of Rural development.
o Panchayat-level plans. • It is responsible for advising the Central Government
o Information, Education & Communication (IEC) on MGNREGA related matters, and for monitoring
activities. and evaluating the implementation of the Act.
• Implementing body: The Department of Water • It prepares Annual Reports on the implementation of
Resources, River Development & Ganga MGNREGA for submission to Parliament.
Rejuvenation, Ministry of Jal Shakti.
• Priority areas: Functions:
o The priority areas identified under the scheme • It advises the Central Government on all matters
fall in the states of Gujarat, Haryana, Karnataka, concerning the implementation of this Act.
Madhya Pradesh, Maharashtra, Rajasthan and • It reviews the monitoring and redressal mechanism
Uttar Pradesh. and recommends improvements required.
o States represent about 25% of the total number • It prepares annual reports to be laid before
of over-exploited, critical and semi-critical blocks Parliament by the Central Government on the
in terms of ground water in India. implementation of this Act.
o Also cover two major types of groundwater
systems found in India – alluvial and hard rock
DRAFT BLUE ECONOMY POLICY
aquifers- and have varying degrees of
institutional readiness and experience in In News: Recently, the Ministry of Earth Sciences (MoES)
groundwater management. has rolled out the draft Blue Economy policy, inviting
suggestions and inputs from various stakeholders.
SANKALP
About Blue Economy:
In News: Recently, the Union Minister of Skill • The concept was introduced by Gunter Pauli in his
Development and Entrepreneurship has chaired a 2010 book- “The Blue Economy: 10 years, 100
function ‘Transforming skilling through strategic innovations, 100 million jobs”.
partnerships under ‘SANKALP’. • It is the sustainable use of ocean resources and ocean
development strategies for economic growth,
About

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OnlyIAS UDAAN PLUS: ECONOMY

improved livelihoods and jobs, and ocean ecosystem 3. Marine fisheries, aquaculture, and fish
health. processing.
• It provides for an inclusive model that helps the 4. Manufacturing, emerging industries, trade,
coastal nations to extend the benefit of ocean technology, services, and skill development.
resources to all. 5. Logistics, infrastructure and shipping, including
• It advocates the inclusion and participation of all trans-shipments.
vulnerable social groups and sectors. 6. Coastal and deep-sea mining and offshore
• It also ascertains the United Nations’ SDGs, especially energy.
SDG14 ‘Life Below Water. 7. Security, strategic dimensions, and international
• This concept predominantly aims for the engagement.
development of human wellbeing and social equity,
whilst reducing environmental risks and ecological THE HYDROGEN ECONOMY – NEW DELHI
scarcities of the ocean. DIALOGUE 2021
• In News: Recently, the Union Minister inaugurated
It encompasses: The Hydrogen Economy – New Delhi Dialogue 2021.
• Renewable Energy: Sustainable marine energy can
play a vital role in social and economic development. About Hydrogen Economy – New Delhi Dialogue
• Fisheries: Sustainable fisheries can generate more 2021:
revenue, more fish and help restore fish stocks. • New Delhi Dialogue 2021 is organized by The Energy
• Maritime Transport: Over 80% of international Forum(TEF), an independent think tank in India in
goods traded are transported by sea. collaboration with the Federation of Indian
• Tourism: Ocean and coastal tourism can bring jobs Petroleum Industry(FIPI).
and economic growth. • FIPI is under the patronage of the Ministry of
• Climate Change: Oceans are an important carbon Petroleum and Natural Gas.
sink (blue carbon) and help mitigate climate change. • It will comprise a High-level Ministerial Session
• Waste Management: Better waste management on followed by Panel Discussions by eminent
land can help oceans recover. policymakers.
• It focus on policy roadmaps and mapping the demand
India’s blue economy: and supply of Hydrogen.
• India’s blue economy is understood as a subset of the • Objectives:
national economy. o To understand the progress of the Hydrogen
• It comprises an entire ocean resources system and ecosystem across continents and contribute to
human-made economic infrastructure in marine, creating synchrony among the think
maritime, and onshore coastal zones within the tanks, Governments and the industry to join
country’s legal jurisdiction. forces for developing innovative and sustainable
• It aids the production of goods and services that have technologies at attractive costs.
clear linkages with economic growth, environmental o It aims to discuss emerging hydrogen ecosystems
sustainability, and national security. and exploring opportunities for collaboration,
• The blue economy is a vast socio-economic cooperation and coalition.
opportunity for coastal nations like India to utilize
ocean resources for societal benefit responsibly. Hydrogen Economy
• The term "hydrogen economy" refers to the vision of
Blue Economy Policy: using hydrogen as a low-carbon energy source
• It is in line with the Government of India’s Vision of replacing, for example, gasoline as a transport fuel or
New India by 2030. natural gas as heating fuel.
• The policy document highlighted the blue economy • Hydrogen is a promising energy carrier and has the
as one of the ten core dimensions for national growth. potential to address various energy sector challenges
• It emphasizes policies across several key sectors to and technically from the application point of view,
achieve holistic growth of India’s economy. substituting conventional fuels.
• Aims to:
o Enhance the contribution of the blue economy to National Hydrogen Mission
India’s GDP • It had recently announced the National Hydrogen
o Improve the lives of coastal communities Mission in the Union Budget 2021 for making a
o Preserve marine biodiversity and hydrogen roadmap for the country.
o Maintain the national security of marine areas • It aims to generate hydrogen from green power
and resources sources.
• Seven thematic areas: • It is essential to decarbonise heavy industries like
1. National accounting framework for the blue steel and cement, it also holds the key to clean electric
economy and ocean governance. mobility that doesn’t depend on rare minerals.
2. Coastal marine spatial planning and tourism.

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OnlyIAS UDAAN PLUS: ECONOMY

Hydrogen o NTPC Limited will play a role in providing logistic

• It is considered the future of clean and sustainable and infrastructure support.
energy. o The duration of the proposed National Mission
• It can be directly used as a fuel similar to natural gas would be a minimum five years.
or as input for fuel cells to generate electricity. • Sub-Groups:
• The sources and processes by which hydrogen is 1. Sub-Group I: It will carry out the research on
derived, are categorised by colour tabs. properties/characteristics of biomass.
• Hydrogen produced from fossil fuels is called grey 2. Sub-Group II: It will carry out technical
hydrogen, this constitutes the bulk of the hydrogen specification and safety aspects including
produced today. research in boiler design.
• Hydrogen generated from fossil fuels with carbon 3. Sub-Group III: It will be responsible for
capture and storage options is called blue hydrogen. resolving issues related to the supply chain
• Hydrogen generated entirely from renewable power during the mission period.
sources is called green hydrogen. 4. Sub-Group IV: It will select designated labs and
• In the last process, electricity generated from certification bodies for testing of agro-based
renewable energy is used to split water into biomass pellets and Municipal Solid Waste
hydrogen and oxygen in an electrolyser. (MSW) pellets.
5. Sub-Group V: It will be formed on the regulatory
framework and economics of biomass co-firing in
NATIONAL MISSION ON USE OF BIOMASS IN
coal based Thermal power plants.
THERMAL POWER PLANTS
• Significance:
In News: Recently, the Ministry of Power has decided to o It will address the issue of air pollution due to
set up a National Mission on use of Biomass in coal based farm stubble-burning.
thermal power plants. o It will reduce the carbon footprints of thermal
power generation and help the nation move
About towards cleaner energy sources.
• Objectives of the mission: o It will also contribute to the National Clean Air
o To increase the level of co-firing from present 5% Programme.
to higher levels to have a larger share of carbon
neutral power generation from the thermal Biomass
power plants. • Biomass is organic, meaning it is made of material
o To take up R&D activity in boiler design to handle that comes from living organisms, such as plants and
the higher amount of silica, alkalis in the biomass animals.
pellets. • The most common biomass materials used for energy
o To facilitate overcoming the constraints in are plants, wood, and waste. These are called biomass
supply chain of bio mass pellets and agro- feedstocks.
residue and its transport upto to the power • World's Top Biofuel Crops: Switchgrass, wheat,
plants. sunflower, cottonseed oil, soy, sugar cane, canola,
o To consider regulatory issues in biomass co- corn, etc.
firing. • It is an integral part of Earth’s carbon cycle.
• Implementation: • In contrast to fossil fuels, biomass comes from
o The Mission would have a Steering Committee recently living organisms. The carbon in biomass can
headed by Secretary (Power) comprising of all continue to be exchanged in the carbon cycle.
stakeholders including representatives from
Ministry of Petroleum & Natural Gas (MoPNG), Biomass power & cogeneration programme:
Ministry of New & Renewable Energy (MNRE)
• Initiated by the Ministry of New and Renewable
etc.
Energy.
o The Executive Committee would be headed by
• For efficient utilization of biomass, bagasse based
Member (Thermal), CEA. NTPC will play a larger
cogeneration in sugar mills and biomass power
role in providing logistic and infrastructure
generation have been taken up under the
support in the proposed National Mission.
programme.
• Structure:
• Biomass materials used for power generation include
o It will have a Steering Committee headed by the
Rice husk, straw, cotton stalk, coconut shells, soya
Power Secretary.
husk, de-oiled cakes, coffee waste, jute wastes,
o The committee will comprise all stakeholders
groundnut shells, saw dust etc.
including representatives from the Ministry of
• Objective: Promoting technologies for optimum use
New and Renewable Energy and the Ministry of
of the country's biomass resources for grid power
Petroleum and Natural Gas.
generation.
o The Executive Committee would be headed by
Member (Thermal), Central Electricity Authority
(CEA).

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GREEN HYDROGEN MOBILITY PROJECT HYDROGEN FUEL

In News: Recently, NTPC, Maharatna PSU under Ministry In News: Recently, under the ‘Mission Net Zero Carbon
of Power has signed MoU with UT of Ladakh and LAHDC Emission Railway’ by 2030, Indian Railways are set to run
to setup the country’s first Green Hydrogen Mobility trains on hydrogen fuel-based technology. For this, it is
project. considering retrofitting of existing trains.

About the MoU of the Green Hydrogen Mobility About Hydrogen fuel
Project: • Hydrogen is the lightest and first element on the
• It is a step to ensure a carbon-free economy based on periodic table. Since the weight of hydrogen is less
renewable sources and green hydrogen. than air, it rises in the atmosphere and is therefore
• Leh is soon to become India's first city to implement rarely found in its pure form, H2.
a green hydrogen-based mobility project with zero- • At standard temperature and pressure, hydrogen is a
emission. nontoxic, non-metallic, odourless, tasteless,
• MoU will enable NTPC to help Ladakh develop a colourless, and highly combustible diatomic gas.
carbon-free economy based on renewable sources • Hydrogen fuel is a zero-emission fuel burned with
and green hydrogen. oxygen. It can be used in fuel cells or internal
• The signing of the MoU was also marked with the combustion engines. It is also used as a fuel for
inauguration of NTPC’s first solar installations in Leh spacecraft propulsion.
in form of solar trees and a solar carport.
• NTPC has planned to ply 5 hydrogen buses, to start Occurrence of Hydrogen:
with, in the region and the company will be setting up • It is the most abundant element in the universe.
a solar plant and a green hydrogen generation unit in The sun and other stars are composed largely of
Leh towards this end. hydrogen.
• This would be zero-emission mobility in the true • Astronomers estimate that 90% of the atoms in the
sense. universe are hydrogen atoms. Hydrogen is a
component of more compounds than any other
Green Hydrogen: element.
• 'Green hydrogen' is pure hydrogen produced using • Water is the most abundant compound of
renewable energy sources such as wind or solar hydrogen found on earth.
power. • Molecular hydrogen is not available on Earth in
• There are no natural hydrogen deposits on earth, it convenient natural reservoirs. Most hydrogen on
has to be extracted from other compounds by a Earth is bonded to oxygen in water and to carbon in
chemical process. live or dead and/or fossilized biomass. It can be
• If renewable energy (e.g. from Solar panels) is used to created by splitting water into hydrogen and oxygen.
generate electricity for the electrolysis of water then • Storage:
the green hydrogen can be generated without any o Hydrogen can be stored physically as either a gas
harmful emissions. or a liquid.
• Applications of green hydrogen: o Storage of hydrogen as a gas typically requires
o Green Chemicals like ammonia and high-pressure tanks.
methanol can directly be utilized in existing o Storage of hydrogen as a liquid requires
applications like fertilizers, mobility, power, cryogenic temperatures because the boiling
chemicals, shipping etc. point of hydrogen at one atmosphere pressure is
o Green Hydrogen blending up to 10% may be −252.8°C.
adopted in CGD networks to gain widespread o Hydrogen can also be stored on the surfaces of
acceptance. solids (by adsorption) or within solids (by
• Significance of Green Hydrogen: absorption).
o Green hydrogen energy is vital for India to meet
its Nationally Determined Contribution (INDC) Potential of clean hydrogen industry:
Targets and ensure regional and national energy • The only by-product or emission that results from the
security, access and availability. usage of hydrogen fuel is water — making the fuel
o Green Hydrogen can act as an energy storage 100 per cent clean.
option, which would be essential to meet • Hydrogen is considered an alternative fuel. It is due
intermittencies (of renewable energy) in the to its ability to power fuel cells in zero-emission
future. electric vehicles, its potential for domestic
o In terms of mobility, for long distance production, and the fuel cell’s potential for high
mobilisations for either urban freight movement efficiency.
within cities and states or for passengers, Green • In fact, a fuel cell coupled with an electric motor is
Hydrogen can be used in railways, large ships, two to three times more efficient than an internal
buses or trucks, etc. combustion engine running on gasoline.
• Hydrogen can also serve as fuel for internal
combustion engines.
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OnlyIAS UDAAN PLUS: ECONOMY

• The energy in 2.2 pounds (1 kilogram) of hydrogen industry apprenticeship opportunities to the general
gas contains about the same as the energy in 1 gallon graduates exiting in April 2019 through the National
(6.2 pounds, 2.8 kilograms) of gasoline. Apprenticeship Promotion Scheme (NAPS). It was
launched by the Ministry of Education.
PM-DAKSH • Atma Nirbhar Skilled Employee Employer
Mapping (ASEEM): Launched by MSDE in 2020, it is
In News: Recently, the government has launched ‘PM-
a portal to help skilled people find sustainable
DAKSH’ portal and app to make the skill development
livelihood opportunities.
schemes accessible to the target groups of Backward
Classes, Scheduled Castes and Safai Karamcharis.
SEEKHO AUR KAMAO SCHEME
About PM-DAKSH Scheme: In News: Recently, Union Minister for Minority Affairs
• The PM-DAKSH stands for Pradhan Mantri Dakshta has informed Rajya Sabha about the Seekho aur Kamao
Aur Kushalta Sampann Hitgrahi (PM-DAKSH) Yojana. Scheme.
• It is being implemented by the Ministry of Social
Justice and Empowerment from the year 2020-21. About Seekho aur Kamao Scheme:
• Eligibility: Marginalized persons of SC, OBC, • It is a scheme implemented by the Ministry of
Economically Backward Classes, De-notified tribes, Minority Affairs.
Sanitation workers including waste pickers, manual • Purpose: It is a Skill development scheme for the
scavengers, transgenders and other similar youth of the 14 – 35 years age group. It aims at
categories. providing employment and employment
• Training Programme: opportunities, improving the employability of
o Up-skilling/Re-skilling existing workers, school dropouts etc.
o Short Term Training Programme • Implementation: Through selected expert Project
o Long Term Training Programme and Implementing Agencies (PIAs).
o Entrepreneurship Development Program (EDP). • Scheme ensures placements of a minimum of
• Training programs implementation: Government 75% trainees, out of which at least 50% placement
Training Institutes, Sector Skill Councils constituted is in the organized sector.
by the Ministry of Skill Development and • Post-placement support of Rs. 2000/- per month
Entrepreneurship and other credible institutions. is provided to placed trainees under the scheme for
two months as placement assistance.
Features of this portal:
• Availability of all information related to skill Other Schemes of Ministry of Minority Affairs:
development at one place for Scheduled Castes, • Naya Savera Scheme: Provide free coaching to
Backward Classes and Safai Karamcharis. students/candidates belonging to minority
• Facility to register for the training institute and communities for qualifying in entrance examinations
program of their interest. of technical/ medical professional courses and
• Facility to upload desired documents related to various competitive exams.
personal information. • Padho Pardesh Scheme: Scheme of interest subsidy
• Facility to register the attendance of the trainees to students of minority communities on educational
through face and eye scanning during the training loans for overseas higher studies.
period. • Nai Udaan Scheme: Support for students clearing
• Monitoring facility through photo and video clip Prelims conducted by Union Public Service
during training etc. Commission (UPSC), State Public Service Commission
(PSC) Staff Selection Commission (SSC) etc.
Other Initiatives Related to Skill Development: • Nai Roshni Scheme: Leadership development of
• Pradhan Mantri Kaushal Vikas Yojana 3.0: It was women belonging to minority communities.
launched by the Ministry of Skill Development and
Entrepreneurship (MSDE) in 2021 in a bid to UJJWALA 2.0 SCHEME
empower India’s youth with employable skills by
In News: Recently, the Prime Minister launched the
making over 300 skill courses available to them.
second phase of Pradhan Mantri Ujjwala Yojana (PMUY)
• National Career Service Project: Launched in 2015
or Ujjwala 2.0 Scheme.
to offer free online career skills training to job-
seekers registered with it. It is an initiative of the
About Pradhan Mantri Ujjwala Yojana:
Ministry of Labour & Employment.
• Launched in May 2016.
• Skills Acquisition and Knowledge Awareness for
• Aim: To provide LPG (Liquefied Petroleum Gas)
Livelihood (SANKALP): Its focus is on district-level
connections to poor households.
skilling ecosystem through convergence and
• Key features: A deposit-free LPG connection is given
coordination. It is a Centrally Sponsored Scheme
to the eligible household with financial assistance of
which is collaborated with the World Bank.
Rs 1,600 per connection by the Centre.
• Scheme for Higher Education Youth in
Apprenticeship and Skills (SHREYAS): To provide
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OnlyIAS UDAAN PLUS: ECONOMY

• Nodal Ministry: Ministry of Petroleum and Natural o Un-electrified households not covered under the
Gas (MoPNG). SECC data would also be provided electricity
• Target: The scheme gained traction with its ambit connections under the scheme by paying Rs 500.
being expanded to include 80 million poor families • Funding: The Government of India largely provided
from the earlier target of 50 million families with an funds for the Scheme to all States/UTs.
additional allocation of Rs 4,800 crore. • Expected Outcomes:
• Objectives: o Environmental upgradation by substitution of
o Empowering women and protecting their health. Kerosene for lighting purposes.
o Reducing the serious health hazards associated o Improvement in education services.
with cooking based on fossil fuel. o Better health services.
o Reducing the number of deaths in India due to o Enhanced connectivity through radio, television,
unclean cooking fuel. mobiles, etc.
o Preventing young children from significant o Increased economic activities and jobs.
number of acute respiratory illnesses caused due o Improved quality of life especially for women.
to indoor air pollution by burning the fossil fuel.
• Eligibility criteria: RENEWABLE ENERGY CERTIFICATE
o Applicant must a woman above the age of 18 and In News: Recently, the Union Minister of Power and New
a citizen of India. & Renewable Energy has given his assent to amendments
o Applicant should belong to a BPL (Below Poverty in the existing Renewable Energy Certificate (REC)
Line) household. mechanism.
o No one in the applicant’s household should own
an LPG connection. About Renewable Energy Certificates (REC)
o The household income of the family, per month,
• It is a policy instrument to catalyze the development
must not exceed a certain limit as defined by the
of renewable energy.
government of the Union Territories and State
• It is a market-based mechanism that will help the
Government.
states meet their regulatory requirements such as
o Applicant must not be a recipient of other similar
Renewable Purchase Obligations (RPOs) by
schemes provided by the government.
overcoming the geographical constraints on existing
renewable potential in different states.
Ujjwala 2.0:
• Migrant workers would no longer have to struggle to
REC Mechanism:
get address proof documents to get the gas
• REC mechanism is a market-based instrument to
connections.
promote renewable energy and facilitate compliance
• They workers would only be required to submit a
of renewable purchase obligations (RPO).
self-declaration of their residential address to get the
• It is aimed at addressing the mismatch between
gas connection.
availability of RE resources in state and the
requirement of the obligated entities to meet the
SAUBHAGYA SCHEME RPO.
In News: Recently, the Pradhan Mantri Sahaj Bijli Har • 1 REC is treated as equivalent to 1 MWh.
Ghar Yojana (Saubhagya Scheme) has successfully • Types of RECs:
completed four years of its implementation. 1. Solar RECs are issued to eligible entities for
generation of electricity based on solar as
About Saubhagya Scheme: renewable energy source.
• The Saubhagya is a scheme to ensure electrification 2. Non-solar RECs are issued to eligible entities for
of all willing households in the country in rural as generation of electricity based on renewable
well as urban areas. energy sources other than solar.
• It was launched in September 2017.
• The Rural Electrification Corporation Limited Proposed Changes:
(REC) is the nodal agency for the operationalization • Validity of REC would be perpetual i.e., till it is sold.
of the scheme throughout the country. • Floor and forbearance prices are not required to be
• Objective: specified.
o To provide energy access to all by last mile • The RE generator who are eligible for REC, will be
connectivity and electricity connections to all eligible for issuance of RECs for the period of PPA as
remaining un-electrified households in rural as per the prevailing guidelines.
well as urban areas • The existing RE projects that are eligible for REC
o To achieve universal household electrification in would continue to get RECs for 25 years.
the country • A technology multiplier can be introduced for
• Beneficiaries: promotion of new and high priced RE technologies,
o They are identified using Socio Economic and which can be allocated in various baskets specific to
Caste Census (SECC) 2011 data. technologies depending on maturity.

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OnlyIAS UDAAN PLUS: ECONOMY

• RECs can be issued to obligated entities (including About

DISCOMs and open access consumers) which • It guarantees 100 days of work a year to every rural
purchase RE Power beyond their RPO compliance household with an aim to enhance the livelihood
notified by the Central Government. security of people.
• No REC to be issued to the beneficiary of • The National Rural Employment Guarantee Act, 2005
subsidies/concessions or waiver of any other introduced the scheme. In 2010, NREGA renamed as
charges. MGNREGA
• Allowing traders and bilateral transactions in REC • The Act currently covers all districts except for those
mechanism. that have a 100% urban population.
• The Ministry of Rural Development (MRD) in
BIO-ECONOMY association with the state governments monitors the
implementation of the scheme.
In News: Recently, the Union Minister Dr Jitendra Singh
said that Northeast will be developed as India’s Bio-
Key Features of the MGNREGA:
Economic Hub. The Eastern Himalayan Region is one of
the mega-biodiversity rich zones and is among the 34 • Demand-driven scheme: Worker will get the work
biodiversity Hotspots of the world. whenever he demands and not when the Government
has work available.
About • Employment Allowance: Gram Panchayat has the
• Bio-Economy is the production, utilization and mandate to provide employment within 15 days of a
conservation of biological resources to provide work application. If it fails, the worker will get an
information, products, processes and services across unemployment allowance.
all economic sectors. • Timely Payment: Payment of wages within 15 days
of completion of work. In case of failure, the worker
• Resources include biological related knowledge,
science, technology and innovation. will get a delay compensation of 0.05% per day of
wages earned.
Bio-Economy and India: • Women empowerment: Minimum one-third of the
• India’s Bio-Economy, in 2020, is valued at $70.2 workers should be women.
billion. This is a 12.32 percent growth over 2019. The • Minimum wages: Wage payment should be
Bio-Economy in 2019 was valued at $62.5 Billion in according to the Minimum Wages Act 1948 for
2019. agricultural laborers in the State.
• The Bio-Economy’s contribution to the national GDP • Gram Sabhas conduct Social audits to enable the
in 2020 is at 2.7% of the GDP in 2020 community to monitor the implementation of the
• It is estimated that India’s bio-economy is on its way scheme.
to achieve a 150-billion dollar target from the current • Both the Center and the States share the funding of
70 billion dollars by 2025. the scheme.

Initiatives to boost Bio-Economy: Biotech KISAN SUSTAINABLE DEVELOPMENT CELL

• It is a scientist-farmer partnership scheme launched In News: Recently, the Ministry of coal has constituted a
in 2017 by the Department of Biotechnology (DBT). “Sustainable Development Cell”, in line with the
• Aim: To connect science laboratories with the commitment of clean energy.
farmers to find out innovative solutions and
technologies to be applied at the farm level. About Sustainable Development Cell:
• So far 146 Biotech-KISAN Hubs have been • Aim: To promote environmentally sustainable coal
established covering all 15 agro-climatic zones and mining in the country and to address environmental
110 Aspirational Districts in the country. concerns during mining operation and till the
decommissioning or final closure of mines.
Institute of Bioresources and Sustainable • Role and Functions:
Development (IBSD): o To advise, mentor, plan and monitor the
• IBSD is an autonomous institute under the mitigation measures taken by coal companies.
Department of Biotechnology (DBT). o To act as a nodal point at the level of the Ministry
• Set up in 2001 at Imphal, Manipur. in formulating future policy framework for
• Objective: to develop and utilize rich bioresources of environmental mitigation measures including
the North-East Region of the country through the regulation of Mine closure Fund.
application of modern tools of biology and
biotechnology. Other measures:
• First Mile Connectivity (FMC): Coal is being
MGNREGA transported through a conveyor belt from Coal
Handling Plants to Silo for loading. This process
In News: Recently, it has been reported that the Centre’s
eliminates the movement of coal through roads.
flagship rural employment scheme (MGNREGA) has run
• Installing additional Renewable Capacity: In order
out of funds halfway through the financial year.
to contribute to India’s commitment to increase non-
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OnlyIAS UDAAN PLUS: ECONOMY

fossil energy capacity to 500GW by 2030, Coal & • The system would work in standalone mode from 5
Lignite companies have planned to install an pm to 7 am.
additional 5.5GW of renewable capacity.
• Bio-Reclamation of mined-out land: Mine Significance:
reclamation is the process of restoring land that has • It is a unique project for India and would open doors
been mined to a natural or economically usable state. for decarbonising the far-off regions of the country
• Surface Coal Gasification Projects: Planned for like Ladakh, J&K etc, which as of now are dependent
SynGas production which will be used further either on diesel generators.
for production of Methanol/Ethanol, Urea or • The project is in-line with the vision of the Prime
Petrochemicals. Minister for becoming carbon-neutral by 2070 and
making Ladakh a carbon-neutral territory.
SAMPANN PROJECT
National Thermal Power Corporation Limited:
In News: Recently, over one lakh people have received
• NTPC Ltd. is a central Public Sector Undertaking
pensions directly in their bank accounts through the
(PSU) under the Ministry of Power.
SAMPANN (System for Accounting and Management of
Pension) project. • It is India’s largest energy conglomerate with roots
planted way back in 1975 to accelerate power
About SAMPANN Project development in India.
• Launched in 2018 by the Controller General of • Aims to provide reliable power and related solutions
Communication Accounts (CGCA), Department of in an economical, efficient and environment-friendly
Telecommunications. manner, driven by innovation and agility.
• Objective: Seamless online pension processing and • It has a 67,907-MW installed capacity comprising 47
payment system for Department of NTPC stations and 26 joint and 26 joint venture
Telecommunications pensioners to provides direct stations.
credit of pension into the bank accounts of • It has recently revised its target of achieving 60GW
pensioners. renewables capacity by 2032.
• Significance: It has helped the Department in faster • It became a Maharatna company in May 2010.
settlement of pension cases, improved • It is located in New Delhi.
reconciliation/auditing and ease of accounting.
• Features: ETHANOL BLENDED PETROL PROGRAMME
o Direct disbursement of pension on a timely basis • In News: During Ethanol Supply Year (ESY) 2020-21,
without intermediaries, 302.30 crore litre of Ethanol has been procured by
o Single window system for complete pension OMCs for blending purpose till 30.11.2021.
process,
o Every pensioner gets access to key information About the Programme
like payment history along with a login option, • Launched in 2003, the Ethanol Blending Programme
o Tracking of pension status from home (EBP) sought to promote the use of alternative and
encourages transparency and accountability, environment friendly fuels and to reduce import
o Online submission of grievances and timely SMS dependency for energy requirements.
alerts. • EBP seeks to achieve blending of Ethanol with
motor sprit with a view to:
GREEN HYDROGEN MICROGRID PROJECT o Reduce pollution,
In News: Recently, National Thermal Power Corporation o Conserve foreign exchange and
Ltd has awarded the country’s first green hydrogen o Increase value addition in the sugar industry
microgrid project at its Simhadri (near Visakhapatnam) enabling them to clear cane price arrears of
plant in Andhra Pradesh. farmers.
• Implementation: Ministry of Petroleum & Natural
About Green Hydrogen Microgrid Project Gas (MoP&NG).
• It is India’s first Green Hydrogen based Energy • Since 2019, this programme is being implemented in
Storage Project. the whole of India except UTs of Andaman Nicobar
• Under this project, hydrogen would be produced and Lakshadweep islands wherein OMCs sell petrol
using the advanced 240 kW Solid Oxide Electrolyser blended with 10% ethanol.
by taking input power from the nearby Floating Solar • Procurement: OMCs are to procure ethanol from
project. domestic sources.
• The hydrogen produced during sunshine hours o OMCs are advised to continue according priority
would be stored at high pressure and would be of ethanol from sugarcane juice/sugar/sugar
electrified using a 50 kW Solid Oxide Fuel Cell. syrup; heavy molasses; heavy molasses; and
• A solid oxide fuel cell (or SOFC) is an electrochemical Damaged Food grains/other sources, in that
conversion device that produces electricity directly order.
from oxidizing a fuel.

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o To increase production of fuel grade ethanol and Government Initiatives:

to achieve blending targets, the Govt of India has • Initiatives related to Green Energy
allowed use of maize and rice with FCI. • International Solar Alliance
• Targets: • One Sun, One World, One Grid (OSOWOG).
o Currently, 8.5% of ethanol is blended with petrol • National Solar Mission.
in India. • Pradham Mantri Kisan Urja Suraksha evam Utthaan
o National Policy on Biofuels 2018 has 10% Mahabhiyaan (PM KUSUM)
blending target for mixing ethanol with petrol by • Atal Jyoti Yojana
2022 & 20% blending target by 2030. • Suryamitra Skill Development Programme
o To facilitate achieving of new blending targets, a • Solar Park Scheme and Grid Connected Solar Rooftop
"grid” which networks distilleries to Oil Scheme
Marketing Companies (OMCs) depots and details • Rewa Solar Power Plant.
quantities to be supplied has been worked out.
• National Wind-Solar Hybrid Policy 2018.
• Hydrogen Based Fuel Cells Vehicles.
INTRA-STATE TRANSMISSION SYSTEM - GREEN
ENERGY CORRIDOR
• In News: Recently, the Cabinet Committee on
Economic Affairs approved the scheme on Green
Energy Corridor (GEC) Phase-II for Intra-State
Transmission System (InSTS).

About Green Energy Corridor Project for Intra-State

Transmission System (InSTS)
• The Green Energy Corridor(GEC) Project aims at
synchronizing electricity produced from renewable
sources such as solar and wind with conventional
power stations in the grid.

Phase I of the Project:

• It is being implemented by eight renewable-rich
states of Tamil Nadu, Rajasthan, Karnataka, Andhra
Pradesh, Maharashtra, Gujarat, Himachal Pradesh,
and Madhya Pradesh.
• Under this phase, the target is to install 9700 circuit
km of transmission lines and 22,600 MegaVolt-
Amperes(MVA) transformation capacity of
substations by 2022.
• The funding mechanism consists of a 40%
Government of India Grant, 20% state equity and a
40% loan from KfW Bank, Germany.

Phase II of the Project:

• It is being implemented in seven States namely,
Gujarat, Himachal Pradesh, Karnataka, Kerala,
Rajasthan, Tamil Nadu and Uttar Pradesh.
• Under this phase, the target is to install 10,750 circuit
km of transmission lines and 27,500 MegaVolt-
Amperes(MVA) transformation capacity of
substations by 2025-26.
• The Centre will provide assistance at 33% of the cost
of the project.

Objectives:
• Synchronizing the electricity produced from
renewable resources, such as wind and solar, with the
conventional power stations in the grid.
• It aims to achieve the target of 450 GW installed RE
capacity by 2030.
• To evacuate approx. 20,000 MW of large-scale
renewable power and improvement of the grid in
implementing states.
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OnlyIAS UDAAN PLUS: ECONOMY

• Initiatives:
11. IMPORTANT INDEX AND o Globally Important Agricultural Heritage
REPORTS Systems(GIAHS).
o Codex Alimentarius Commission or CAC
o Tree Cities of the World programme
DIGITAL PAYMENTS INDEX
• Flagship Publications:
In News: Recently, RBI has released Digital Payment o The State of World Fisheries and Aquaculture
Index which shows that digital payments in India rose to (SOFIA).
304.06 in September 2021 against 217.74 in the year-ago o The State of the World's Forests (SOFO).
month. o The State of Food Security and Nutrition in the
World (SOFI).
About the Index: o The State of Food and Agriculture (SOFA).
• The RBI-DPI comprises 5 broad parameters that o The State of Agricultural Commodity Markets
enable measurement of deepening and penetration of (SOCO).
digital payments in the country over different time
periods.
INDIA INNOVATION INDEX
• 5 Parameters:
1. Payment Enablers (weight 25%), In News: Recently, the second edition of the NITI Aayog’s
2. Payment Infrastructure – Demand-side factors India Innovation Index has been released.
(10%),
3. Payment Infrastructure – Supply-side factors About the index:
(15%), • The index attempts to create an extensive framework
4. Payment Performance (45%) and for the continual evaluation of the innovation
5. Consumer Centricity (5%). environment of states and union territories in India
• Base period of the RBI-DPI has been set as March and intends to perform the following three functions:
2018, which means DPI score for March 2018 is set at 1. Ranking of states and UTs based on their index
100. scores.
• As per RBI, the index will be published on a semi- 2. Recognizing opportunities and challenges.
annual basis with a lag of four months. 3. Assisting in tailoring governmental policies to
• Significance: Digital payments in India have been foster innovation.
growing rapidly. The DPI reflects accurately the • The Index is calculated as the average of the scores of
penetration and deepening of various digital its two dimensions – Enablers and Performance.
payment modes. • The Enablers are the factors that underpin innovative
capacities, grouped in five pillars:
1. Human Capital,
WORLD FOOD PRICE INDEX: FAO
2. Investment,
In News: Recently, The Food and Agriculture 3. Knowledge Workers,
Organization(FAO) has released the World Food Price 4. Business Environment,
Index. 5. Safety and Legal Environment.
• The Performance dimension captures benefits that a
About World Food Price Index: nation derives from the inputs, divided in two pillars:
• The index was introduced in 1996. It was to help in 1. Knowledge Output
monitoring the developments in the global 2. Knowledge Diffusion.
agricultural commodity markets.
• Purpose: The index is a measure of the monthly Performance of various states:
change in international prices of a basket of food • Karnataka is the most innovative state for the
commodities. second year in a row.
• Commodities: It consists of the average of five • Maharashtra pipped Tamil Nadu to the second spot.
commodity group price indices. Such as cereal, • Bihar was featured at the bottom of the list.
vegetable, dairy, meat and sugar. Also, these five
indices is given weightage based on the average
INDIA ENERGY OUTLOOK 2021 REPORT
export shares.
• Base Year: The Base Year for the index is 2014-16. In News: Recently, International Energy Agency (IEA) has
released its India Energy Outlook 2021 report.
About Food and Agriculture Organization (FAO):
• It is a specialized agency of the United Nations that Findings:
leads international efforts to defeat hunger. • India will make up the biggest share of energy
• It was established in 1945. The FAO is demand growth at 25% over the next two decades, as
headquartered in Rome, Italy. it overtakes the European Union as the world’s third-
• Treaty: FAO is the depository body of the biggest energy consumer by 2030.
International Treaty on Plant Genetic Resources for • India’s energy consumption is expected to nearly
Food and Agriculture. double as the nation’s gross domestic product (GDP)

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OnlyIAS UDAAN PLUS: ECONOMY

expands to an estimated $8.6 trillion by 2040 under • Measures in place to ensure the capability of
its current national policy scenario. contributing its share of an IEA collective action.
• India’s growing energy needs will make it more
reliant on fossil fuel imports as its domestic oil and Reports by IEA:
gas production has been stagnant for years despite • Global Energy & CO2 Status Report.
government policies to promote petroleum • World Energy Outlook.
exploration and production and renewable energy. • World Energy Statistics.
• India’s oil demand is expected to rise to 8.7 million • World Energy Balances.
barrels per day (bpd) in 2040 from about 5 million • Energy Technology Perspectives.
bpd in 2019, the IEA said, while its refining capacity
will reach 6.4 million bpd by 2030 and 7.7 million bpd
BARE NECESSITIES INDEX
by 2040, from 5 million bpd.
• The world’s second-biggest net oil importer after In News: Economic Survey 2020-21 constructs a Bare
China currently imports about 76% of its crude oil Necessities Index (BNI) at the rural, urban and all India
needs. That reliance on overseas oil is expected to level.
rise to 90% by 2030 and 92% by 2040.
• Rising oil demand could double India’s oil import bill About Bare Necessities Index
to about $181 billion by 2030 and nearly treble it to • The BNI builds on the idea of Thalinomics in the
$255 billion by 2040 compared with 2019. Economic Survey for 2019-20, through which it had
sought to examine the access to food in the country.
About IEA: • The BNI summarises 26 indicators on five
• Established in 1974 as per framework of the OECD, dimensions:
IEA is an autonomous intergovernmental 1. Water,
organisation. 2. Sanitation,
• Its mission is guided by four main areas of focus: 3. Housing,
energy security, economic development, 4. Micro-environment and
environmental awareness and engagement 5. Other facilities
worldwide. • Data Collection: The index has been created for all
• Headquarters (Secretariat): Paris, France. states based on data collected by the National
• Roles and functions: Statistical Office(NSO) in 2012 and 2018.
o Established in the wake of the 1973-1974 oil • Range: The index classifies areas on three levels of
crisis, to help its members respond to major oil access — high, medium, low — to bare necessities.
supply disruptions, a role it continues to fulfil The index has a range of 0 to 1 where 1 represents the
today. best access to the basic necessities
o IEA’s mandate has expanded over time to include
tracking and analyzing global key energy trends, Findings:
promoting sound energy policy, and fostering • Performance of States: States such as Kerala,
multinational energy technology cooperation. Punjab, Haryana, and Gujarat top the index. While
• Composition and eligibility: eastern Indian States of Odisha, Jharkhand, West
o It has 30 members at present. Bengal, and Tripura have occupied the lowest
o IEA family also includes eight association positions.
countries. • Inter-State disparity in access to the basic
o A candidate country must be a member necessities has declined in 2018, when compared to
country of the OECD. But all OECD members 2012.
are not IEA members. • Richer vs Poorer States: The Poorer States have
reduced the gap with rich States in providing access
To become member a candidate country must to the basics of daily life - housing, water, power,
demonstrate that it has: sanitation, cooking gas.
• Crude oil and/or product reserves equivalent to 90
days of the previous year’s net imports, to which the INDEX OF ECONOMIC FREEDOM 2021
government has immediate access (even if it does not In News: Recently, The Heritage Foundation releases
own them directly) and could be used to address ‘The Index of Economic Freedom 2021’.
disruptions to global oil supply.
• A demand restraint programme to reduce national oil About Index of Economic Freedom
consumption by up to 10%. • It is an annual index.
• Legislation and organisation to operate the Co- • This index created in 1995 by think-tank The
ordinated Emergency Response Measures (CERM) on Heritage Foundation and The Wall Street Journal.
a national basis. • Purpose: It measures the degree of economic
• Legislation and measures to ensure that all oil freedom in countries across the world.
companies under its jurisdiction report information • Coverage: The Index covered economic freedoms in
upon request. 184 countries.

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OnlyIAS UDAAN PLUS: ECONOMY

• Parameters: The index measures 12 indicators Findings of 2021:

grouped into four broad categories of economic • Finland has been ranked as the happiest country
freedom: in the world for the fourth consecutive year.
1. Rule of Law (property rights, government • Afghanistan (149) is the most unhappy country.
integrity, judicial effectiveness) • India has been ranked 139, out of 149 countries
2. Government Size (government spending, tax evaluated.
burden, fiscal health)
3. Regulatory Efficiency (business freedom, labour International Happiness Day:
freedom, monetary freedom) • It highlights the importance of happiness in the
4. Open Markets (trade freedom, investment diurnal lives of people.
freedom, financial freedom). • This resolution was first initiated by Bhutan which
• Each of these twelve economic freedoms within emphasised on the importance of national happiness
these categories is graded on a scale of 0 to 100. Score over national income.
0 is the least economic freedom and score 100 is the • Theme of 2021: “Happiness For All, Forever”.
highest economic freedom.
OXFAM INEQUALITY INDEX
Findings
• India ranked 121st in the index with a score of 56.5 In News: Recently, the Minister of Labour and
points under the category of ‘mostly unfree’. Employment has given a written reply to a question on
• In Asia-Pacific, India ranked 26th among the 40 India’s performance under Oxfam Inequality Index.
countries.
About
India in Index • Released by: Oxfam International.
• In Asia Pacific India rank 26 among 40 countries, • Parameters: The index ranks 158 countries. The
scoring 56.5 points. Index measures the policies and actions in three
• Globally, the Foundation rates India's economy as the areas directly related to reducing inequality.
121st freest. Although its overall score is unchanged, • The three areas are:
improvements were made in business freedom. This 1. Public services(health, education and social
was offset by declines in judicial effectiveness and protection)
other scores. 2. Taxation
• The report commented that: The Indian economy 3. Worker’s rights.
remains in the mid-range of the mostly unfree • Index's Findings Related to India: India has been
category. ranked 129 overall in the index out of 158 countries.
• A move toward greater economic freedom would
require substantial and broad-based reforms. Ranking based on Parameters:
• In addition to taking steps to improve fiscal health • India has ranked 141 in terms of its public services
and strengthen the rule of law, the government would such as health, education and social protection.
need to increase financial freedom and reform the tax • India has ranked 19th in the index, in terms of
code, the investment regime, and the labour code. taxation.
• India has fared poorly in protecting labour rights and
has slipped to rank 151.
WORLD HAPPINESS REPORT 2021
• Other Key Findings: The index has been topped by
In News: Recently, the Sustainable Development Norway followed by Denmark and Germany.
Solutions Network (SDSN) for the United Nations
released the World Happiness Report 2021, a day before Objections raised by the Indian Government:
the International Happiness Day. • The rank assigned to India and the methodology
adopted is not clear. The index does not take into
About the Report: account the provisions of the four new labour codes
• The World Happiness Report ranks 149 countries which protects labour rights.
by how happy their citizens perceive themselves to • India is not a signatory to two International Labour
be. Organisation conventions. But the principles of the
• The rankings are based on polling (Gallup World Poll) conventions were available to Indian workers, the
which looks at six variables: Index does not take account of this.
1. Gross Domestic Product Per Capita (Purchasing
Power Parity). The two conventions:
2. Social Support. 1. Freedom of association and protection of the right to
3. Healthy life expectancy at birth. organise convention (C87).
4. Freedom to make life choices. 2. The right to organise and collective bargaining (C98).
5. Generosity.
6. Perceptions of corruption.
• Respondents rate their own current lives on a 0-10
scale.
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OXFAM REPORT: INEQUALITY KILLS INTERNATIONAL INTELLECTUAL PROPERTY

In News: Recently, the Oxfam report titled “Inequality INDEX
Kills’’ was released, the report pointed out a stark income In News: Recently, India has improved its overall
divide worsened by the Covid pandemic, globally and in International Intellectual Property (IIP) score from
India. 38.4% to 38.6%, and the country is ranked 43rd out of 55
countries on the International Intellectual Property
Report Highlights Index.
• Magnitude of Growing Inequities: Widening
economic, gender, and racial inequalities—as well as About IIP Index:
the inequality that exists between countries are • It is an annual report released by the US Chamber of
tearing our world apart. Commerce Global Innovation Policy Centre(GIPC).
• Economic Violence: A kind of economic violence is • Aim: The index evaluates Intellectual Property rights
perpetrated when structural policy choices are made in 53 global economies. These economies represent
for the richest and most powerful people. This affects together over 90% of global GDP.
the poorest people, women and girls, and racialized • Parameters: It ranks countries based on 50 unique
groups most. indicators. These indicators are divided across nine
• Unequal Access to Healthcare: Healthcare of good categories of protection:
quality is a human right, but is too often treated as a 1. Patents
luxury for rich people. 2. Copyrights
• Gender-Based Violence: It is rooted in patriarchy 3. Trademarks
and sexist economic systems. For example, sex- 4. Design rights
selective abortions. 5. Trade secrets
• Poverty-Induced Hunger: Hunger is one of the ways 6. Commercialization of IP assets
in which poverty kills, and it is faced by billions of 7. Enforcement
ordinary people all over the world each day. 8. Systemic efficiency
• Inequality of Climate Change Crisis: The emissions 9. Membership and ratification of international
of the richest people are driving this Climate Change treaties.
crisis, with the CO2 emissions of 20 of the richest • Significance: The IP Index serves as a roadmap for
billionaires estimated on average to be 8,000 times policymakers who look to support creativity,
that of the billion poorest people. innovation and economic growth through more
• Vaccine Apartheid: Rich countries may back their robust IP policy.
pharmaceutical monopoly billionaires and hoard
vaccines to protect their populations, but in so doing Findings:
they push their own people toward risk from the • The overall score of India has increased from 38.40
mutations that vaccine apartheid is creating. percent (19.20 out of 50) in the ninth edition of this
report to 38.64 percent (19.32 out of 50) in the latest
Oxfam edition.
• Oxfam is a confederation of 21 independent • The Top 5 Countries in the International Intellectual
charitable organizations focusing on the Property Index:
alleviation of global poverty 1. United States of America
• It was founded in 1942 and led by Oxfam 2. United Kingdom
International. 3. Germany
• It is a major non-profit group with an extensive 4. Sweden
collection of operations. 5. France
• HQ at Nairobi, Kenya
• Vision: A world where people and the planet are at US Chamber of Commerce:
the center of our economy. Where women and girls • It is the world’s largest business federation
live free from violence and discrimination. Where the representing the interests of more than 3 million
climate crisis is contained. And where governance businesses of all sizes, sectors, and regions, as well
systems are inclusive and allow for those in power to as state and local chambers and industry
be held to account. associations.
• Oxfam recognizes the universality and indivisibility • The group was founded in April 1912 out of local
of human rights and has adopted these overarching chambers of commerce at the urging of President
aims to express these rights in practical terms: William Howard Taft and his Secretary of Commerce
1. The right to a sustainable livelihood and Labour Charles Nagel.
2. The right to basic social services
3. The right to life and security Government Initiatives for Intellectual Property
4. The right to be heard Rights (IPR) Protection:
5. The right to an identity • Indian Patent Act 1970
• National Intellectual Property Rights (IPR) Policy
2016
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OnlyIAS UDAAN PLUS: ECONOMY

• India is also a member of the following important 1. Large disparities in vaccine access and,
World Intellectual Property Organisation (WIPO)- 2. The difference in policy support (or the help
administered International Treaties and Conventions provided by the respective governments).
relating to IPRs.
Key Highlights from the January 2021 WEO Report:
World Intellectual Property Organization (WIPO) • Indian economy is expected to grow by 12.5% in
• It is the global forum for intellectual property (IP) 2021 and 6.9% in 2022.
services, policy, information and cooperation. • In 2020, India’s economy witnessed an estimated
• It is a self-funding agency of the United Nations, with contraction of 8%.
193 member states. • Growth rate for India in 2021 is stronger than that of
• Its mission is to lead the development of a balanced China.
and effective international IP system that enables • China was the only major economy to have a positive
innovation and creativity for the benefit of all. growth rate of 2.3% in 2020, and is expected to grow
• Its mandate, governing bodies and procedures are set by 8.6% in 2021 and 5.6% in 2022.
out in the WIPO Convention, which established WIPO
in 1967. International Monetary Fund
• Set up along with the World Bank after the Second
WORLD ECONOMIC OUTLOOK World War to assist in the reconstruction of war-
ravaged countries.
In News: Recently, the IMF (International Monetary
• The two organisations were agreed to be set up at a
Fund) unveiled its 2nd World Economic Outlook (WEO)
conference in Bretton Woods in the US. Hence, they
for 2021.
are known as the Bretton Woods twins.
About • Created in 1945, the IMF is governed by and
accountable to the 189 countries that make up its
• It is a survey by the IMF that is usually published
near-global membership. India joined on 27th
twice a year in the months of April and October.
December, 1945.
• Objective: It analyzes and predicts global economic
• Primary Objective: To ensure the stability of the
developments during the near and medium term.
international monetary system the system of
• It also projects developments in the global financial
exchange rates and international payments that
markets and economic systems.
enables countries (and their citizens) to transact with
• Publishing frequency: The IMF comes out with the
each other.
WEO report twice every year - April and October.
• The Fund's mandate was updated in 2012 to include
• It is based on a wide set of assumptions about a host
all macroeconomic and financial sector issues that
of parameters such as the international price of crude
bear on global stability.
oil and set the benchmark for all economies to
• Reports by IMF:
compare one another with.
o Global Financial Stability Report.
o World Economic Outlook.
Key Points:
• Compared to July forecast, the global growth
projection for 2021 has been revised down ENERGY TRANSITION INDEX 2021
marginally to 5.9 per cent and is unchanged for 2022 In News: Recently, the World Economic Forum (WEF) has
at 4.9 per cent. released the Energy Transition Index, 2021.
• This modest headline revision, however, masks large
downgrades for some countries. About Energy Transition Index (ETI), 2021:
• The outlook for the low-income developing country • Energy Transition Index is an annual report by the
group has darkened considerably due to worsening World Economic Forum (WEF). It prepares the report
pandemic dynamics. in collaboration with Accenture.
• But more than just the marginal headline numbers • Objective: The ranking aims to enable policy-makers
for global growth, it is increasing inequality among and businesses to plan for a successful energy
nations that the IMF was most concerned about. transition.
• The dangerous divergence in economic prospects • ETI checks the readiness of countries for transition to
across countries remains a major concern. secure, sustainable, affordable, and inclusive energy
• Aggregate output for the advanced economy group is systems.
expected to regain its pre-pandemic trend path in • Parameters: The index ranks 115 countries on the
2022 and exceed it by 0.9 per cent in 2024. basis following three dimensions:
• By contrast, aggregate output for the emerging 1. Economic development and growth,
market and developing economy group (excluding 2. Environmental sustainability
China) is expected to remain 5.5 per cent below the 3. Energy security and access;
pre-pandemic forecast in 2024, resulting in a larger
setback to improvements in their living standards. Findings Related to India:
• India ranks at the 87th position among 115 countries
• Two key reasons for the economic divergences: in the Energy Transition Index (ETI).
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OnlyIAS UDAAN PLUS: ECONOMY

• India improved in energy transition through the • The rise in electric car sales in 2020 came even as the
subsidy reforms and by increasing energy access with worldwide automobile market contracted by 16%
a regulatory environment and strong political due to the Covid-19 pandemic.
commitment. • Apart from that, the number of electric cars, buses,
vans and heavy trucks on roads is expected to hit 145
Other Facts: million by 2030.
• Sweden tops the index. It is followed by Norway and • If the governments improve their efforts to meet
Denmark. international climate goals, then the number of global
• China has been ranked 67th on the index. India and electric vehicles will increase to 230 million by 2030.
China collectively account for a third of global energy
demand. PURCHASING MANAGERS’ INDEX
In News: Recently, Purchasing Managers’ Index (PMI) for
World Economic Forum (WEF):
the services sector dropped for a second successive
• It is a Swiss non-profit foundation established in
month in December 2021 to 55.5.
1971, based in Geneva, Switzerland.
• Recognized by the Swiss authorities as the About Purchasing Managers’ Index (PMI)
international institution for public-private
• It is an index of the prevailing direction of economic
cooperation.
trends in the manufacturing and service sectors.
• Mission: Committed to improving the state of the
• It is an economic indicator, which is derived after
world by engaging business, political, academic, and
monthly surveys of different companies.
other leaders of society to shape global, regional, and
• There are two types of PMI — Manufacturing PMI and
industry agendas.
Services PMI.
• Founder and Executive Chairman: Klaus Schwab.
• A combined index is also made using both
• Major reports published:
manufacturing PMI and services PMI.
o Energy Transition Index.
• Methodology:
o Global Competitiveness Report.
o The PMI is compiled by IHS Markit from
o Global IT Report (WEF along with INSEAD, and
responses to questionnaires sent to purchasing
Cornell University publishes this report)
managers in a panel of around 400
o Global Gender Gap Report.
manufacturers, based on company workforce
o Global Risk Report.
size, based on contributions to GDP.
o Global Travel and Tourism Report
o Survey responses are collected in the second half
of each month and indicate the direction of
GLOBAL ELECTRIC VEHICLES OUTLOOK 2021 change compared to the previous month.
• In News: Recently, International Energy Agency o IHS Markit is a London based global leader in
(IEA) has released a report titled “Global Electric information, analytics and solutions for the
Vehicle Outlook Report,2021”. major industries and markets that drive
• The Global EV Outlook (GEVO): It is an annual economies worldwide.
report published by IEA. The report looks at the • Calculation of PMI:
latest EV trends. Apart from that, it also looks at the o It is indicated by a number from 0 to 100.
drivers for road transport sector electrification o A print above 50 means expansion while a score
around the world. below 50 denotes contraction.
o A reading at 50 indicates no change.
Key Findings related to India: o If the previous month PMI is higher than the
• More than 30% of the new vehicle sales in India current month PMI, it represents that the
will be electric by 2030. economy is contracting.
• Electric Vehicles (EV) deployment in India will • Purpose:
mainly be achieved through the electrification of o To provide information about current and future
two/three-wheelers. As per the report the electric business conditions to company decision-
two/three-wheeler sales will reach a sales share of makers, analysts, and investors.
almost 50% by 2030. o The index helps in determining whether the
• The lack of government spending under the FAME II market conditions, as seen by purchasing
Scheme has delayed EV deployment in India. managers, is expanding, contracting or staying
• EV deployment was also delayed due to pressure on the same.
domestic automakers to focus on BS-VI innovation
instead of EVs. WORLD EMPLOYMENT AND SOCIAL OUTLOOK:
TRENDS 2021
Global Scenario In News: Recently, the International Labour Organisation
• 3 million new electric cars were registered in 2020. (ILO) has released the World Employment and Social
This was 41% higher than those registered in 2019. Outlook: Trends (WESO) report 2021.

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About the World Employment and Social Outlook WORLD ENERGY INVESTMENT REPORT 2021
report:
In News: Recently, the International Energy Agency (IEA)
• The report analyses key labour market issues
published the World Energy Investment Report, 2021.
including unemployment, labour underutilisation,
working poverty, income inequality, labour income
About the World Energy Investment Report 2021:
share and factors that exclude people from decent
• The report presents the latest data and analysis of
work.
how energy investment flows are recovering from the
• It highlights how the COVID-19 crisis had worsened
shock of the Covid-19 pandemic.
pre-existing inequalities by hitting vulnerable
• This includes full-year outlook estimates for 2021.
workers harder.
Key Findings:
Key Findings:
• Global energy investments are set to recover by
• COVID-induced job loss: Covid-19 induced jobs loss
nearly 10% in 2021 to $1.9 trillion reversing the
will reach 75 million in 2021, before falling to 23
decline in 2020.
million in 2022.
• Power Sector: Global Power Sector which saw flat
• Further, people who have held onto their jobs have
investments in 2020 is set to receive the highest ever
seen their working hours cut dramatically.
funding i.e. up by about 5% to more than $820 billion.
• Global Unemployment: Unemployment is expected
Among them, Renewables are forecast to account for
to stand at 205 million people in 2022. This far
70% of the total.
greater than the 187 million in 2019. This
• Fossil Fuels: The technologies like Carbon Capture
corresponds to an unemployment rate of 5.7%.
and Storage(CCS) are yet to attain commercial
• Poor quality of jobs: The quality of newly created
success. So, the investments in oil are expected to
jobs would likely deteriorate in developing and
grow by about 10%.
emerging economies.
• Coal Sector: The approvals for coal-fired plants are
• Increase in Poverty: Compared to 2019, an
some 80% below where they were five years ago. But
additional 108 million workers worldwide are now
coal is not out of the picture as there is a slight
categorized as poor or extremely poor. This means
increase in coal-fired plants in 2020 driven by China
they and their families live on the equivalent of less
and some other Asian economies.
than US$3.20 per person per day.
• The Energy efficiency sector will also see a
• Women: Covid-19 crisis has hit women
substantial rise (10%) in investment. But the low
disproportionately. They have lost jobs at a greater
fossil fuel price may act as a deterrent.
rate than men. Moreover, additional domestic
• Increase in Emissions: The present scenarios will
responsibilities for women from crisis lockdowns
not deter the increase in carbon dioxide emission
have created the risk of a “re-traditionalization” of
after the contraction in 2020. The Global emission is
gender roles.
set to grow by 1.5 billion tonnes in 2021.
• Child Labour: The crisis has also appeared to reverse
• Net Zero Plan: The commitments to the Net Zero
the decade of progress in battling child labour and
plan is gaining momentum, but its transition to actual
forced labour.
action is not visible.
International Labour Organisation
International Energy Agency:
• It was created in 1919, as part of the Treaty of
• It is an autonomous Intergovernmental Organisation
Versailles that ended World War I, to reflect the belief
established in 1974 in Paris, France.
that universal and lasting peace can be accomplished
• IEA mainly focuses on its energy policies which
only if it is based on social justice.
include economic development, energy security and
• It became a specialized agency of the United Nations
environmental protection. These policies are also
in 1946.
known as the 3 E’s of IEA.
• It is a tripartite organization, the only one of its kind
bringing together representatives of governments,
India and IEA:
employers and workers in its executive bodies.
• India became an Associate member of IEA in
• Members:
March 2017 but it was in engagement with IEA long
o India is a founding member of the ILO with a
before its association with the organization.
total 187 member States.
• India has inked a Strategic Partnership Agreement
o In 2020 India assumed the Chairmanship of the
with the IEA to strengthen cooperation in global
Governing Body of ILO.
energy security, stability and sustainability.
• Headquarter: Geneva in Switzerland.
• Awards: In 1969, ILO received the Nobel Peace Prize Reports:
for improving fraternity and peace among nations,
• World Energy Investment Report
pursuing decent work and justice for workers, and
• World Energy Outlook Report
providing technical assistance to other developing
• Global Energy Review.
nations.

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OnlyIAS UDAAN PLUS: ECONOMY

GLOBAL LIVEABILITY INDEX • Aim: The index ranks 64 economies. It assesses the
extent to which a country promotes the prosperity of
In News: Recently, Economist Intelligence Unit (EIU) has
its people by measuring economic well-being through
released the Global Liveability Index 2021.
data and survey responses.
About Global Liveability Index: • Parameters: The index measures the prosperity and
competitiveness of countries by examining four
• The index assesses the locations that provide the best
factors:
and the worst living conditions around the world. It
1. Economic performance
assesses 140 cities around the world.
2. Government efficiency
• Parameters: The index takes into account more than
3. Business efficiency
30 qualitative and quantitative factors. These factors
4. Infrastructure
are spanning five broad categories:
1. Stability (25%)
Findings:
2. Healthcare (20%)
• Top Rankings: Switzerland has topped the index. It
3. Culture and environment (25%)
was followed by Sweden, Denmark, Netherlands and
4. Education (10%)
Singapore.
5. Infrastructure (20%).
• Top-performing Asian economies in order:
• Due to the pandemic, the EIU added new indicators to
Singapore (5th), Hong Kong (7th), Taiwan (8th) and
it. It includes stress on healthcare resources as well
China (16th).
as restrictions around local sporting events, theatres,
music concerts, restaurants, and schools. • The UAE and the USA remain in the same spots as last
year (9th and 10th, respectively)
Scores:
Findings related to India
• Each factor in a city is rated as acceptable, tolerable,
uncomfortable, undesirable, or intolerable. • India’s Ranking: India has maintained the 43rd rank
in the world competitiveness index 2021. In 2020,
• Factor-wise scores are then compiled and weighted
India was ranked 43rd on the index.
to provide a score of 1–100 where 1 is considered
intolerable and 100 is considered ideal. • Comparison with BRICS Countries: Among BRICS
countries, India was ranked second (43rd) after
Findings: China (16th), followed by Russia (45th), Brazil (57th)
and South Africa (62nd).
• Top Five Liveable Cities: Auckland (New Zealand),
Osaka (Japan), Adelaide (Australia), Wellington (New • Strengths of India: India’s strengths lie in
Zealand), and Tokyo (Japan). investments in telecoms (1st), mobile telephone
costs (1st), ICT services exports (3rd), remuneration
• Top Five Least Liveable Cities: Damascus (Syria),
in services professions (4th) and terms of trade index
Lagos (Nigeria), Port Moresby (Papua New Guinea),
(5th).
Dhaka (Bangladesh), and Algiers (Algeria).
• Weaknesses of India: India’s weakness lies in the
Other Facts: broadband subscribers (64th), exposure to
particulate pollution (64th), human development
• Austria's Vienna, number one in both 2018 and 2019,
index (64th), GDP per capita (63rd) and foreign
has completely dropped out of the top 10 after being
currency reserves per capita (62nd).
heavily affected by Covid-19, and now ranks 12.
• Auckland rose to the top of the ranking owing to its
successful approach in containing the Covid-19 WORLD INVESTMENT REPORT 2021
pandemic. In News: Recently, UN Conference on Trade and
• Damascus remains the world's least liveable city, as Development (UNCTAD) has released its World
the effects of the civil war in Syria continue to take Investment report 2021
their toll.
• Most of the previous ten least liveable cities remain About World Investment Report
in the bottom ten this year, including Dhaka • The World Investment Report focuses on trends in
(Bangladesh) and Karachi (Pakistan) in the Asia- Foreign Direct Investment (FDI) worldwide, at the
Pacific (APAC) region. regional and country levels and emerging measures
to improve its contribution to development.
WORLD COMPETITIVENESS INDEX 2021
India:
In News: Recently, World Competitiveness Index 2021
has been released by the Institute for Management • India is the fifth largest recipient of Foreign Direct
Development (IMD). Investment (FDI) in the world.
• FDI has increased 27% to USD 64 billion (2020) from
About World Competitiveness Index: USD 51 billion (2019), due to the acquisitions in the
• It is an annual report published since 1989. Information and Communication Technology (ICT)
industry.
• Released by: The index is released by the Institute
for Management Development (IMD). • The second wave of the COVID-19 in India weighs
heavily on the country's overall economic activities
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OnlyIAS UDAAN PLUS: ECONOMY

but its strong fundamentals provide optimism for the In News: Recently, the Reserve Bank of India (RBI) has
medium term. unveiled the first composite Financial Inclusion Index (FI-
• The investments from India may stabilise in 2021, Index).
supported by the country's resumption of free trade
agreement (FTA) talks with the European Union (EU) About Financial Inclusion Index:
and its strong investment in Africa. • Annual Financial Inclusion Index (FII) will measure
access and usage of a basket of formal financial
Global: products and services that includes savings,
• The global FDI flows have been severely hit by the remittances, credit, insurance and pension products.
pandemic and they plunged by 35% in 2020 to USD 1 • It would rate states on their performance on last-mile
trillion. banking services availability.
• COVID-19 led lockdowns around the world slowed • Aim: To capture the extent of financial inclusion
down existing investment projects and prospects of a across the country.
recession led multinational enterprises (MNEs) to • These are also the G20 Financial Inclusion Indicators.
reassess new projects. • It will be published in July every year by RBI.
• The pandemic boosted demand for digital
infrastructure and services globally, which led to Parameters:
higher values of greenfield FDI project • Access to financial services
announcements targeting the ICT industry, rising by • Usage of financial services
more than 22%. • The quality of the products and the service delivery.

Asian region: Importance of FII:

• While some large economies in developing Asia like • Provide information on the level of financial
China and India recorded FDI growth in 2020, the rest inclusion.
recorded a contraction. • Measure financial services for use of internal policy
• FDI outflows from South Asia fell 12% to USD 12 making.
billion, driven by a drop in investment from India. • It can be used directly as a composite measure in
• A wider resurgence of the virus in Asia could development indicators.
significantly lower global FDI in 2021, given that • It enables fulfilment of G20 Financial Inclusion
region's significant contribution to the total. Indicators requirements.
• Signs of trade and industrial production recovering in • It will also facilitate researchers to study the impact
the second half of 2020 provide a strong foundation of financial inclusion and other macro-economic
for FDI growth in 2021. variables.

Other Facts: Related Initiatives:

• India, China and Hong Kong were among the • Pradhan Mantri Jan Dhan Yojana: It was
countries saw a rise in 2020. announced in August 2014, which proved to be a
• FDI outflows from South Asia fell 12% to USD 12 steady vehicle for financial inclusion.
billion, due to a drop in investment from India. • Digital Identity (Aadhaar): It has catalyzed
• India ranked 18 out of the world’s top 20 economies inclusion and innovation in the delivery of financial
for FDI outflows, with 12 billion dollars of outflows services.
recorded from the country in 2020 as compared to 13 • National Centre for Financial Education (NCFE):
billion dollars in 2019. The RBI has released the (NCFE): 2020-2025
document for creating a financially aware and
UNCTAD empowered India.
• It was established in 1964 to promote development- • Centre for Financial Literacy (CFL) Project: It is an
friendly integration of developing countries into the innovative and participatory approach
world economy. conceptualised by the RBI to financial literacy at the
• UNCTAD is a permanent intergovernmental body. Block level involving select banks and non-
• HQ: Geneva in Switzerland. governmental organisations (NGOs).
• Major reports published:
o Trade and Development Report PERIODIC LABOUR FORCE SURVEY
o World Investment Report
o The Least Developed Countries Report In News: Recently, the National Statistical Office (NSO)
o Information and Economy Report released the third annual report on Periodic Labour Force
o Technology and Innovation Report Survey (PLFS), conducted between July 2019 and June
o Commodities and Development Report 2020.

About Periodic Labour Force Survey

FINANCIAL INCLUSION INDEX • Considering the importance of the availability of
labor force data at more frequent time intervals,

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OnlyIAS UDAAN PLUS: ECONOMY

National Statistical Office (NSO) launched PLFS in compared to 7.9% in the corresponding months a
April 2017. year ago.
• Objective: • The labour force participation rate for ages 15 and
o To estimate the key employment and above in urban areas was 47.3% in October-
unemployment indicators (viz. Worker December quarter of 2020, down from 47.8% in the
Population Ratio, Labour Force Participation same period a year ago.
Rate, Unemployment Rate) in the short time • The Worker Population Ratio for ages 15 and above
interval of three months for the urban areas only in urban areas was 42.4% in October-December
in the Current Weekly Status (CWS). quarter of 2020, down from 44.1% in the same period
o To estimate employment and unemployment a year ago.
indicators in both ‘Usual Status’ and CWS in both
rural and urban areas annually. National Statistical Office (NSO)
• Central statistical agency of the Government
Various Dimensions of the Survey: mandated under the Statistical Services Act 1980.
• Labour Force Participation Rate (LFPR): LFPR is • Ministry: Ministry of Statistics and Programme
defined as the percentage of persons in the labor Implementation.
force (i.e. working or seeking or available for work) • Role and Functions:
in the population. o It is responsible for the development of
• Worker Population Ratio (WPR): WPR is defined as arrangements for providing statistical
the percentage of employed persons in the information services to meet the needs of the
population. Government and other users for information on
• Unemployment Rate (UR): UR is defined as the which to base policy, planning, monitoring and
percentage of persons unemployed among the management decisions.
persons in the labor force. o The services include collecting, compiling and
• Activity Status- Usual Status: When the activity disseminating official statistical information.
status is determined on the basis of the reference • Other Reports & Indices by NSO:
period of the last 365 days preceding the date of the o Index of Industrial Production (IIP)
survey, it is known as the usual activity status of the o Consumer Price Index (CPI)
person. o Sustainable Development Goals National
• Activity Status- Current Weekly Status (CWS): The Indicator Framework Progress Report
activity status determined on the basis of a reference
period of the last 7 days preceding the date of the INDEX OF INDUSTRIAL PRODUCTION
survey is known as the CWS of the person.
In News: Recently, the Index of Industrial Production
(IIP) and Consumer Price Index (CPI) figures were
Key findings:
released for August 2021.
• India’s unemployment rate fell between July 2018
and June 2019 to 5.8% from 6.1% during the same
About Index of Industrial Production:
period of 2017-18, even as the labour force
• IIP is an indicator that measures the changes in the
participation rate rose to 37.5% from 36.9%.
volume of production of industrial products during a
• The worker population ratio also increased, to 35.3%
given period.
as against 34.7% in the 2017-18.
• It is compiled and published monthly by the
• Urban unemployment rate reduced to 7.7% in 2018-
National Statistical Office (NSO), Ministry of
19 from 7.8 % and in rural India to 5% from 5.3%.
Statistics and Programme Implementation.
• Female participation rate improved in both urban
• It is a composite indicator that measures the growth
and rural India during the period under review, going
rate of industry groups classified under:
up to 18.6% in 2018-19 from 17.5% the year before.
o Broad sectors, namely, Mining, Manufacturing,
and Electricity.
QUARTERLY BULLETIN OF PERIODIC LABOUR o Use-based sectors, namely Basic Goods, Capital
FORCE SURVEY (OCTOBER-DECEMBER 2020) Goods, and Intermediate Goods.
• Dataset differs from the Annual Report of Periodic • Base Year for IIP is 2011-2012.
Labour Force Survey, which covers both rural and
urban areas. Unemployment data for urban areas is Significance of IIP:
released quarterly. • It is used by government agencies including the
• NSO is the central statistical agency of the Ministry of Finance, the Reserve Bank of India, etc, for
Government mandated under the Statistical Services policy-making purposes.
Act 1980 under the Ministry of Statistics and • IIP remains extremely relevant for the calculation of
Programme Implementation. the quarterly and advance GDP (Gross Domestic
Product) estimates.
Findings:
• Unemployment rate for ages 15 and above in urban Findings:
areas rose to 10.3% in October-December 2020 as
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OnlyIAS UDAAN PLUS: ECONOMY

• Industrial output rose 11.9% in August 2021, Global scenario:

showing a double-digit year-on-year increase. • Switzerland topped the league table, followed by
• The IIP constituents [mining, manufacturing and Sweden, the US and the UK.
electricity] posted appreciable improvements of • Among Asian economies, South Korea jumped to the
23.6%, 9.7% and 16%, respectively. fifth position, up from 10 last year.
• There were contractions in last year when the • China was in the 12th position.
economy was still struggling to recover from the first
COVID-19 lockdown. Other Findings from the GII 2021:
• Mining and manufacturing (together account for 94% • Investments in innovation reached an all-time high
of the index) posted sequential contractions of 0.8% before the pandemic with R&D growing at an
and 0.5%, respectively. exceptional rate of 8.5% in 2019.
• Only consumer non-durables and construction goods • Government budget allocations for the top R&D
posted increases from July 2021. spending economies showed continued growth in
2020.
About Eight Core Sectors: • The publication of scientific articles worldwide grew
• These comprise 40.27% of the weight of items by 7.6% in 2020.
included in the Index of Industrial Production (IIP). • India, Kenya, the Republic of Moldova, and Vietnam
• Eight core sector industries in decreasing order hold the record for overperforming on innovation
of their weightage: Refinery Products> Electricity> relative to their level of development for the 11th
Steel> Coal> Crude Oil> Natural Gas> Cement> year in a row.
Fertilizers.
India Innovation Index
GLOBAL INNOVATION INDEX 2021 • It has been developed by NITI (National Institution
for Transforming India) Aayog on the lines of the GII.
In News: Recently, India has climbed two spots and has
been ranked 46th in the Global Innovation Index (GII) • Parameters:
2021 rankings. 1. Patents per million of population,
2. Publication in scientific journals,
About Global Innovation Index: 3. Percentage of GDP spending on research.
4. Specific to the Indian economy (eg. Demographic
• The Global Innovation Index (GII) is an annual
dividend), to give it a more holistic coverage.
ranking of countries by their capacity for, and
success in, innovation.
• Published by: Cornell University, INSEAD, and the CIPS EXCELLENCE IN PROCUREMENT AWARDS
World Intellectual Property Organization, in 2021
partnership with other organisations and In News: Recently, Government e Marketplace (GeM) was
institutions. announced as the winner in the Best Use of Digital
• It is based on both subjective and objective data Technology category at the CIPS Excellence in
derived from several sources, including the Procurement Awards 2021 (CIPS Awards).
International Telecommunication Union, the World
Bank and the World Economic Forum. About CIPS Excellence in Procurement Awards 2021:
• Launched: in 2007 by INSEAD and World Business, a • CIPS Excellence in Procurement Awards 2021 is
British magazine. given by the London based Chartered Institute of
• The GII is commonly used by corporate and Procurement & Supply (CIPS), a non-profit
government officials to compare countries by their organization.
level of innovation. • The awards are given to celebrate the best work and
• Indicators: The index ranks world economies teams in the procurement profession.
according to their innovation capabilities and
consists of roughly 80 indicators grouped into Government e-Marketplace:
innovation inputs and outputs: • It is a 100% Government owned Section 8
1. Innovation inputs: Institutions; Human capital Company set up under the aegis of the Department
and research; Infrastructure; Market of Commerce, Ministry of Commerce and Industry.
sophistication; Business sophistication. • Objective: Online marketplace for the procurement
2. Innovation outputs: Knowledge and technology of goods and services by Central and State
outputs; Creative outputs Government organizations.
• The procurement of goods and services by Ministries
India’s performance: and the Central Public Sector Enterprises (CPSEs) is
• India has been on a rising trajectory, over the past mandatory for goods and services available on GeM.
several years in the Global Innovation Index (GII), • Nodal Ministry: Ministry of Commerce and Industry.
from a rank of 81 in 2015 to 46 in 2021. • Significance of GeM:
• India ranks 2nd among 34 lower middle-income o Enables transparent and Cost-effective
economies? and? 1st among 10 Central and Southern Procurement
Asian economies. o Promotes India’s Atmanirbhar Bharat Policy
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OnlyIAS UDAAN PLUS: ECONOMY

o Facilitates entry of small local sellers in Public Eligibility:

Procurement. • Industrial Park should have at least ten industrial
o Facilitates online marketplace to aggregate units in the area of 20 hectares.
demand from multiple entities for similar • It should possess minimum infrastructure facilities
products. like road, electricity, water and sewage and effluent
treatment facilities.
INDUSTRIAL PARK RATINGS SYSTEM REPORT • It should use only 50% of the total area allocated for
In News: Recently, the Department for Promotion of the industrial units.
Industry and Internal Trade (DPIIT) has released the • It should follow the guidelines of the nearest urban
Industrial Park Ratings System Report. area development authority for common facilities,
like road, common plot etc.
About the Report: • The minimum percentage of the area allocated for
• The IPRS pilot exercise was launched in 2018. industrial use should not exceed 65% of the total
• Objective: To enhance industrial infrastructure area.
competitiveness and supporting policy development • It should provide 5% of the total area for Industrial
for enabling industrialization across India. workers, and the other 5% of the total area should be
• The 2nd edition of the IPRS Report was launched by reserved for an office building.
the Ministry of Commerce & Industry.
• The IPRS 2.0 was started in 2020 & saw the NOBEL PRIZE IN ECONOMICS 2021
participation of all the States of India and 51 SEZs, In News: The 2021 Nobel Prize in Economic Sciences has
including 29 Private & 24 Private Sector Industrial been awarded in one half to Canadian-born David Card
Parks. and the other half jointly to Israeli-American Joshua D
• Ratings were undertaken for 449 out of 478 Angrist and Dutch-American Guido W Imbens.
nominations received. The feedback survey involved
responses from 5,700 tenants. David Card:
• IPRS 2.0 framework is four pillared model for • Awarded for his empirical contributions to labour
assessment of industrial infrastructure in India: economics.
1. Internal infrastructure (Sub pillars- Utilities, • He has analysed how minimum wages, immigration
Common Infrastructure, Value added and education impact the labour market.
infrastructure) • One of the significant findings of this research was
2. External infrastructure and connectivity that “increasing the minimum wage does not
3. Business support services necessarily lead to fewer jobs”.
4. Environment and safety management • It also led to the understanding that “people who
were born in a country can benefit from new
Findings: immigration, while people who immigrated at an
• 41 Industrial Parks have been assessed as "Leaders" earlier time risk being negatively affected”.
in the report. • It also illuminated the role of resources available in
• About 98% of these parks are from western school in shaping the future of students in the labour
(Maharashtra, Rajasthan and Gujarat) and northern market.
(Uttarakhand) regions.
• 90 Industrial Parks have been rated as under Joshua Angrist and Guido Imbens:
Challenger category. • Award “for their methodological contributions to the
• 185 Industrial Parks have been rated as under analysis of causal relationships.”
"Aspirers". • Their work demonstrated “how precise conclusions
about cause and effect can be drawn from natural
Industrial Parks experiments”.
• An industrial park is a section of the city that has been
designated, planned, and zoned for industrial Nobel Prize in Economic Sciences 2020:
development rather than residential or commercial • Awarded: Paul R Milgrom and Robert B Wilson
needs. • Work: “improvements to auction theory and
• The parks might include companies that provide inventions of new auction formats”
manufacturing, transportation, and storage facilities,
such as chemical plants, airports, and beverage Sveriges Riksbank Prize in Economic Sciences:
manufacturers. • The Nobel peace prize in Economics is officially titled
• Some industrial parks offer tax incentives for as “Sveriges Riksbank Prize in Economic Sciences” in
businesses to locate there, such as tax increment Memory of Alfred Nobel”.
financing. • Inception:
• The industrial parks often create environmental o This prize was started in the year 1968 by the
issues, due to increased pollution and the potential donation from the central bank of Sweden called
for surrounding area to be damaged by contaminants. “Sveriges Riksbank” to the Nobel Foundation in

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OnlyIAS UDAAN PLUS: ECONOMY

order to commemorate the 300th anniversary of In News: Recently, the Ministry of Commerce and
the central bank. Industry has released the Logistics Ease Across Different
o Prize money States (LEADS) Report (Index) 2021.
o Comprises a 10 million Swedish kronor award
money which roughly accounts for Rs 8.33 crore. About Logistics Ease Across Different States (LEADS)
Index:
GLOBAL FOOD SECURITY INDEX 2021 • It is a composite indicator to assess international
trade logistics across states and Union territories.
In News: India is ranked at 71st position in the Global
Food Security Index which was released recently. • LEADS is an attempt to bring Longevity, Efficiency,
Accuracy, Durability, and Smartness in the Logistics
About Global Food Security (GFS) Index: sector.
• The GFS Index was designed and constructed by • It is a perception-based survey.
London-based Economist Impact and is sponsored by • It is based on a stakeholders’ survey for the Ministry
Corteva Agriscience. of Commerce and Industry.
• It measures the underlying drivers of food security in • LEADS is influenced by the World Bank’s biannual
113 countries, based on the factors of affordability, Logistics Performance Index (LPI).
availability, quality and safety, and natural resources
and resilience. Parameters:
1. Infrastructure,
• Publishing Frequency: Every year. The 2021 GFSI is
the tenth edition of the index. 2. Services,
3. Timeliness,
• Calculation: It measures the underlying drivers of
4. Track and trace,
food security based on the following factors -
5. Competitiveness of pricing,
1. Affordability
6. Safety of cargo,
2. Availability
7. Operating environment and
3. Quality and Safety
8. Regulatory process.
4. Natural Resources and Resilience
Ranking of States:
Findings:
• Top Performers: Gujarat, Haryana and Punjab
• Top ranking countries: Ireland, Australia, the UK,
Finland, Switzerland, the Netherlands, Canada, Japan, • This is the third year in a row that Gujarat remained
France and the US shared the top rank with the on top of the rankings.
overall GFS score in the range of 77.8 and 80 points • Delhi stands at the top rank among Other UTs.
on the index. • West Bengal, Rajasthan, Madhya Pradesh, Goa, Bihar,
• Bottom five countries: Malawi(109th), Sudan(110), Himachal Pradesh and Assam were ranked 15th,
Mozambique(111), Yemen(112) and Burundi(113). 16th, 17th, 18th, 19th, 20th and 21st respectively.
• North Eastern States and Himalayan Region: Jammu
Performance of India and its neighbours: and Kashmir followed by Sikkim and Meghalaya.
• India held 71st position with an overall score of 57.2
points on the GFS Index, better than Pakistan (75th), WAGE RATE INDEX
Sri Lanka (77th), Nepal (79th) and Bangladesh In News: Expert Group unveils report on base revision of
(84th). But way behind China (34th position). Wage Rate Index (WRI) to 2016=100 from base 1963-
• Pakistan (52.6 points) and Sri Lanka (62.9 points) 65=100.
scored better than India (50.2 points) in the category
of food affordability. About
• Over the past 10 years, India’s incremental gains in • The new series of Wage Rate Index (WRI) with
overall food security score were lagging behind that base year 2016=100, is being compiled and
of Pakistan, Nepal and Bangladesh. maintained by Labour Bureau, an attached office
of Ministry of Labour & Employment.
Related Government Initiatives: • The new series of WRI with base 2016=100 will
• Eat Right India Movement replace the old series with base 1963-65=100.
• POSHAN Abhiyan • The New WRI Series with base 2016=100 would be
• Food Fortification compiled twice a year on point-to-point half
• National Food Security Act, 2013 yearly basis, as on 1st January and 1st July of every
• Integrated Child Development Services (ICDS) year.
Scheme
• National Innovations in Climate Resilient Agriculture Major Improvements
(NICRA) • The weighting diagram in the new WRI series has
been prepared from the results of the Occupational
LEADS REPORT 2021 Wage Survey (Seventh) round.

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OnlyIAS UDAAN PLUS: ECONOMY

• A total of 37 industries have been covered in the new • Livelihoods India Summit is held as an annual event
WRI basket (2016=100) as against 21 industries in that brings together up to 500 participants and over
the 1963-65=100 series. 70 resource persons, from across the region, on a
• The selected 37 industries in the new series are single platform to discuss critical issues that impede
categorized as 30 industries from Manufacturing and afflict the livelihoods of the poor and in turn
sector, 4 industries from Mining Sector and 3 inform policy with the new learning.
industries from Plantation Sector as compared to 14
industries from Manufacturing sector, 4 industries Livelihood India Summit:
from Mining Sector and 3 industries from Plantation • The 11th edition of the summit was organized by
Sector in the old series. ACCESS Development Services on 16th and 17th
• In the new WRI basket, the current wage data has December, 2021, virtually with NITI Aayog as co-host.
been collected from 2881 units under 37 selected • It looks into policies and activities significant for the
industries as against to 1256 units under 21 promotion of livelihoods, the COVID-19 challenge
industries in the old series of WRI. and effect as an underlying theme.
• About 700 occupations have been covered under 37 • Theme of the summit: “Coping with the Pandemic:
selected industries in new series of WRI (2016=100). Lessons We Have Learnt & Way Forward”.
• Livelihoods India was initiated in 2010 as a national
STATE OF INDIA’S LIVELIHOOD REPORT 2021 level initiative to bring together diverse stakeholders
on a single platform to discuss critical issues that
In News: Recently, State of India’s Livelihood (SOIL)
impede and afflict the livelihoods of the poor.
Report 2021 has been released.

About the Report GLOBAL UNICORN INDEX 2021

• Released by: It is an annual Report released by the In News: Recently, Hurun Research Institute has released
ACCESS Developmental Services. the Global Unicorn Index 2021.
• Authoritative commentary on:
o Policy and programmes of the government, About the Index:
potential opportunities for the poor, and • The index is a ranking of the world’s start-ups
o Role of the private sector and the civil society in founded in the 2000s, are worth at least a billion
livelihoods promotion. dollars and are not listed on a public exchange.
• It tracks the trends and analyses the environment in • Released by: Hurun Research Institute.
the sector. • A unicorn is a term used in the venture capital
• Focus of the report: The 2021 Report has analysed industry to describe a startup company with a
only Farmer Producer Companies (FPCs). value of over $1 billion.

Findings: Findings:
• In the last 7 years, just 1-5 % of FPOs have received • India has a total of 54 Unicorns. It is ranked third in
funding under central government schemes the world, after the United States and China.
introduced to promote them. • India has added 33 Unicorns in a single year. This has
• Only 5% of total registered FPOs have been able to helped India overtake the UK in the number of
secure the grants under Equity Grant Scheme and Unicorns.
Credit Guarantee Scheme. • US and China are way ahead of India in the number of
• FPOs registered under Companies Act make up a Unicorns.
large majority of the organisations while the FPOs • The US has added 254 unicorns and now totals 487
registered as cooperatives /societies are less in companies, while China added 74 to take its tally to
number. 301 Unicorns. These top-two occupants are home to
74% of the unicorn universe.
Livelihoods India:
• It is aimed at supporting, informing and influencing
policy, showcasing best practices and addressing key
challenges and issues faced by the livelihoods of the
poor.
• Mission: To create a regional platform that presents
opportunities for cross learning and sharing of these
unique experiences, both successes and failures
within countries in the region.
• Sub initiatives:
o Livelihoods India Summit.
o State of India’s Livelihoods (SOIL) Report.
o Sitaram Rao Livelihoods India Case Study
Competition.
o FPO Impact Awards
To join courses, Click here 126 [email protected] /+91-7007931912
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