CONTENTS
- India-US Trade Policy Meet
- Active Permafrost Structures in Kashmir Himalayas
- GST Revenue Data and State Disparities in Consumption Growth
- World Economic Situation and Prospects Report for 2024
- Zero Defect Zero Effect (ZED) scheme
- VIPER Rover
India-US Trade Policy Meet
Context:
Representatives of the Government of India and the US Government are set to meet at the Trade Policy Forum (TPF) — India’s bilateral platform with the US.
Relevance:
GS II: International Relations
Dimensions of the Article:
- Importance of Trade Policy Forum for India
- Restoration of Generalized System of Preferences (GSP)
- Boosting Service Trade with the US: India’s Strategies
Importance of Trade Policy Forum for India
Key Trade Partnership with the US
- The US stands as India’s largest trade partner, holding a pivotal role in India’s international trade relations.
- India exports more to the US than it imports, making it a crucial economic relationship.
Dependence on US Demand
- Amid the slowdown in Western goods exports due to the Russia-Ukraine war, India heavily relies on US demand for sustaining export earnings.
Strategic Role in Countering China
- India sees the US-led Indo-Pacific Economic Framework for Prosperity (IPEF) as a strategic tool to counterbalance China’s influence in the Asian trade landscape.
Indo-Pacific Economic Framework (IPEF)
- IPEF, initiated in 2021, focuses on enhancing economic partnerships in the Indo-Pacific region.
- Aims include bolstering resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness among participating countries, representing 40% of the world GDP.
Flexibility in Trade Negotiations
- Unlike a Free Trade Agreement (FTA), IPEF provides flexibility for members to negotiate specific aspects.
- Offers a platform for constructive negotiations and collaboration in various economic domains.
Boosting Foreign Direct Investment (FDI)
- Strengthening trade ties with the US could enhance India’s attractiveness for foreign direct investment (FDI).
Resolving Trade Tensions
- In the absence of an FTA with the US, trade policy forum meetings serve as essential platforms for addressing trade tensions and fostering tangible export growth.
Restoration of Generalized System of Preferences (GSP)
- GSP is the oldest and largest US trade preference program, promoting economic development by allowing duty-free entry for numerous products from designated beneficiary countries.
- It encompasses the majority of preferential schemes offered by developed nations to support developing countries.
India’s Loss of GSP Benefits
- In 2019, India lost GSP benefits initiated by former US President Donald Trump, citing trade imbalances with India and China.
- Trump’s trade measures, part of a broader trade war, affected India significantly, given its status as the largest GSP beneficiary in 2017.
Expectations and Non-Restoration
- Despite expectations of GSP restoration under the Joe Biden administration, the preference program has not been reinstated.
- Discussions on GSP restoration have taken place during the India-US trade policy forum.
US’ Concerns on India’s Laptop Import Monitoring System
Questions Surrounding Monitoring System
- The US continues to question India’s proposed laptop import monitoring system, despite India clarifying that it won’t impose restrictions on laptop imports.
- Seen as a potential non-tariff measure, concerns arise regarding the purpose of the monitoring system.
Boosting Service Trade with the US: India’s Strategies
Liberal Visa Regime
- India seeks a liberal visa regime to enhance service trade, acknowledging the significance of healthy service exports to the US.
Visa Concerns During COVID-19
- Visa delays during the COVID-19 pandemic, a politically sensitive issue in the US election year, have impacted service trade between India and the US.
Totalisation Agreement Demand
- India aims to reinforce its longstanding demand for a totalisation agreement, providing social security to Indian professionals working in the US.
- The agreement aims to eliminate dual social security deductions in both countries, particularly benefiting the Indian IT sector workforce in the US.
-Source: The Hindu
Active Permafrost Structures in Kashmir Himalayas
Context:
A study reveals the existence of over 100 active permafrost structures, termed rock glaciers, in the Jhelum basin of the Kashmir Himalayas. These formations bear crucial implications for the region’s hydrology and pose potential risks amid climate warming.
Relevance:
GS I: Geography
Dimensions of the Article:
- Rock Glaciers: Frozen Features in Mountainous Terrain
- Potential Impacts of Active Rock Glaciers on the Region
- Jhelum Basin of the Kashmir Himalayas
Rock Glaciers: Frozen Features in Mountainous Terrain
Definition and Formation:
- Rock glaciers are distinct landforms comprising a mix of rock fragments and ice.
- They typically emerge in mountainous areas with permafrost, rock debris, and ice.
Formation Process:
- Formed often when debris accumulates on a pre-existing glacier, transforming into a rock glacier as the glacier recedes or thaws.
- Common in elevated regions with steep slopes.
Identification Challenges:
- Visually resembling regular ground, proper identification requires a geomorphological perspective.
Classification:
- Classified as active or relict based on ice presence and movement.
- Active rock glaciers are dynamic and pose more hazards, while relict rock glaciers are stable and less active.
Significance:
- Serve as vital indicators of mountain permafrost.
- Store substantial water in frozen cores, presenting a potential resource amidst water scarcity and glacial retreat.
Potential Impacts of Active Rock Glaciers on the Region
Glacial Lake Outburst Floods (GLOFs):
- Sudden and catastrophic floods resulting from the bursting of a glacial lake dam.
- Risk Amplification: Active rock glaciers near glacial lakes heighten the risk of GLOFs by destabilizing slopes or dams.
- Example: Chirsar Lake and Bramsar Lake facing increased GLOF risk.
Landslides:
- Rapid movements of soil, rock, or snow down a slope.
- Risk Factors: Active rock glaciers contribute to landslides by weakening slope stability or releasing water.
- Consequences: Melting permafrost makes areas unstable, posing threats to settlements and infrastructure.
- Illustration: Nunavik area in Quebec experiencing increased mudslides due to melting permafrost.
Thermokarst Formation:
- Terrain characterized by irregular surfaces from the thawing of ice-rich permafrost.
- Impact: Active rock glaciers may lead to thermokarst features, altering hydrology, ecology, and the carbon cycle.
- Observation: Water bodies near Kulgam town, Jammu and Kashmir, suggesting potential thermokarst lakes.
- High-Risk Example: Batagaika crater, the world’s largest permafrost crater in the Sakha Republic, Russia, resulting from thermokarst collapse.
Jhelum Basin of the Kashmir Himalayas
Source and Course:
- Origin: The upper Jhelum River begins at Vernag, Anantnag, near the base of the Pir Panjal range in the Kashmir Valley.
- Course: Flowing through Srinagar and Wular Lake, the river eventually enters Pakistan.
Contribution to Indus River:
- Significance: The Jhelum is a crucial tributary of the Indus River, contributing to the broader river system in the Indian subcontinent.
Geographical Coverage:
- Region: The river traverses through Jammu and Kashmir, with its waters eventually entering Pakistan.
- Confluence: In Pakistan, the Jhelum joins the Chenab River, further adding to the Indus River system.
Tributaries:
- Primary Tributary: The Kishenganga (Neelum) River serves as a primary tributary to the Jhelum.
- Significant Tributary: The Kunhar River, a notable tributary, links Pakistan-occupied Kashmir and Pakistan through the Kohala Bridge in the Kanghan Valley.
-Source: Down To Earth
GST Revenue Data and State Disparities in Consumption Growth
Context:
Recent data on Goods and Services Tax (GST) revenue indicates uneven consumption growth among Indian states, signaling potential disparities in the overall national economic recovery.
Relevance:
GS III: Indian Economy
Dimensions of the Article:
- Key Insights from Recent GST-Related Data
- Goods and Services Tax (GST): Overview
- Challenges in GST Implementation in India
Key Insights from Recent GST-Related Data
- Overall GST Collections:
- Registered an 11.7% growth in the first nine months of 2023-24 compared to the previous fiscal year.
- State vs. Central GST Growth:
- State GST collections exhibited a higher growth rate (15.2%) than Central GST.
- Differential State Consumption Patterns:
- Robust state GST revenue growth (17% to 18.8%) observed in states like Madhya Pradesh, Maharashtra, and Karnataka.
- Contrasting performance in states such as Gujarat, West Bengal, and Andhra Pradesh, with single-digit growth or contraction.
- Private Consumption Expansion:
- National Statistical Office (NSO) estimates project private final consumption expenditure (PFCE) growth at 4.4% for the year.
- This marks the slowest PFCE growth since 2002-03, excluding pandemic-affected periods.
Goods and Services Tax (GST): Overview
- Introduction:
- GST is a value-added tax system applicable to the supply of goods and services in India.
- Implemented on July 1, 2017, under the 101st Constitution Amendment Act, 2016, with the goal of ‘One Nation One Tax.’
- GST Slabs:
- Primary GST slabs for regular taxpayers: 0% (nil-rated), 5%, 12%, 18%, and 28%.
- Some less commonly used rates include 3% and 0.25%.
- Benefits of GST:
- Replaced multiple indirect taxes, simplifying compliance and reducing paperwork for businesses.
- Online GST portal enhances tax administration and fosters transparency.
- Elimination of cascading taxes leads to lower prices, benefiting consumers.
- Expected to contribute to increased economic growth and job creation by removing tax barriers and improving efficiency.
- GST Council:
- Constitutional body formed to make recommendations on GST implementation issues in India.
- Constituted by the President under Article 279A(1) of the amended Constitution.
Challenges in GST Implementation in India
- Complex Tax Structure:
- GST in India has a multi-tiered structure with various tax slabs, increasing compliance requirements.
- Complexity poses challenges, particularly for smaller businesses, in understanding and adhering to diverse regulations.
- Technological Infrastructure:
- Successful GST implementation relies on a robust technological infrastructure.
- Issues like inadequate technological readiness among businesses and disparities in technology adoption can impede the seamless functioning of the GST network.
- Bogus Firms and Evasion:
- Authorities have identified and cracked down on over 29,000 bogus firms involved in evading GST dues.
- The presence of such entities raises concerns about the effectiveness of the system in preventing evasion.
- Multi-State Registrations:
- Businesses operating across multiple states must register separately in each state for GST compliance.
- This multiplicity of registrations imposes administrative burdens and increases compliance costs, particularly for pan-India businesses, leading to logistical challenges.
-Source: The Hindu
World Economic Situation and Prospects Report for 2024
Context:
A recent United Nations report titled World Economic Situation and Prospects report for 2024 forecasts a decline in global inflation in 2024, but warns of a simultaneous rise in food inflation, particularly in developing nations.
Relevance:
GS II: International Relations
Dimensions of the Article:
- World Economic Situation and Prospects Report 2024: Insights and Implications
World Economic Situation and Prospects Report 2024: Insights and Implications
Global Economic Outlook
- Global GDP growth expected to decelerate from 2.7% in 2023 to 2.4% in 2024.
- Developing economies struggle with recovery, facing high debt and investment shortfalls.
- Low-income nations anticipate only moderate growth due to persistently high-interest rates, geopolitical conflicts, slow international trade, and increased climate-related calamities.
Regional Growth and India’s Projections
- South Asia estimated to grow by 5.2% in 2024, driven by robust expansion in India (6.2% projected growth).
- India’s growth supported by domestic demand, manufacturing, and services.
Inflation Trends
- Global headline inflation shows signs of easing, projected to decline from 5.7% in 2023 to 3.9% in 2024.
- Food price inflation remains critical, exacerbating food insecurity and poverty.
- Weak local currencies, climate-related shocks, and limited pass-through from international prices contribute to ongoing food inflation.
Climate-Related Challenges
- Extreme weather events in 2023 result in devastating wildfires, floods, and droughts.
- Climate change estimates suggest potential 10% reduction in global GDP by 2100.
- Without mitigation, models indicate a potential 23% decrease in average global incomes by 2100.
Global Investment Landscape
- Global investment growth expected to remain low due to economic uncertainties, high debt, and rising interest rates.
- Developed nations prioritize sustainable sectors, while developing nations grapple with capital flight and reduced foreign direct investment.
- Climate finance falls short, emphasizing the need for massive scaling up.
Labour Market Dynamics
- Developed countries experience a robust recovery with low unemployment rates (e.g., 3.7% in the US).
- Developing countries show mixed progress with varied unemployment trends, facing issues of informal employment, gender gaps, and high youth unemployment.
- AI adoption could reduce demand for low-skilled jobs, impacting women and lower-income countries.
Trade and International Finance
- Global trade growth weakened to 0.6% in 2023, anticipated to recover to 2.4% in 2024.
- Rising external debt and increased interest rates hinder developing countries’ access to international capital markets.
- Debt sustainability becomes a critical concern, necessitating debt restructuring and relief efforts.
Multilateralism and Sustainable Development
- Emphasis on strengthened global cooperation for climate action, sustainable development financing, and addressing debt sustainability challenges.
- Multilateralism crucial for achieving UN-mandated Sustainable Development Goals (SDG).
-Source: The Hindu
Zero Defect Zero Effect (ZED) scheme
Context:
Zero Defect Zero Effect (ZED) scheme by the MSME Ministry has achieved the 1 lakh certification milestone, the ministry said recently.
Relevance:
GS II- Government Policies and Interventions
About ZED Scheme:
- ZED or Zero Defect, Zero Effect scheme is for MSME (Micro, Small and Medium Enterprises) Sector to increase the quality of products matching global standards.
- The main objective of ZED or Zero Defect, Zero Effect scheme is to reduce the bad effect of products on the environment. This scheme will help contribute to the environment as well.
- ZED Scheme aims to rate and handhold all MSMEs to deliver top quality products using clean technology.
- It will have sector-specific parameters for each industry.
- MSME sector is crucial for the economic progress of India and this scheme will help to match global quality control standards.
- The slogan of Zero Defect, Zero Effect (ZED) was first mentioned by PM Narendra Modi in his Independence Day speech in 2014.
- It was given for producing high quality manufacturing products with a minimal negative impact on environment.
- ZED Scheme is meant to raise quality levels in unregulated MSME sector which is engine of growth for Indian economy.
- The scheme will be cornerstone of the Central Government’s flagship Make in India programme, which is aimed at turning India into a global manufacturing hub, generating jobs, boosting growth and increase incomes
Objectives:
- Develop an Ecosystem for Zero Defect Manufacturing in MSMEs.
- Promote adaptation of Quality tools/systems and Energy Efficient manufacturing.
- Enable MSMEs for manufacturing of quality products.
- Encourage MSMEs to constantly upgrade their quality standards in products and processes.
- Drive manufacturing with adoption of Zero Defect production processes and without impacting the environment.
- Support ‘Make in India’ campaign.
- Develop professionals in the area of ZED manufacturing and certification.
- Under the scheme, the MSME companies which follow the guidelines and meet the standards set by the ZED will award ZED certification along with several benefits.
-Source: Indian Express
VIPER Rover
Context:
NASA has invited people to send their names to the surface of the Moon aboard the agency’s first robotic lunar rover VIPER – short for Volatiles Investigating Polar Exploration Rover.
Relevance:
GS III: Science and Technology
VIPER Rover: Unraveling Lunar Mysteries
- NASA’s First Mobile Robotic Mission to the Moon
- The Volatiles Investigating Polar Exploration Rover (VIPER) is a groundbreaking robotic mission by NASA.
Key Objectives:
- Proximity to Moon’s South Pole
- VIPER will closely examine the Moon’s South Pole, offering detailed insights into ice and other resources in this region.
- Surface and Subsurface Analysis
- VIPER will directly analyze surface and subsurface lunar ice at various depths and temperature conditions within distinct soil environments.
- Resource Mapping
- The data transmitted by VIPER will be utilized to create comprehensive resource maps, aiding scientists in determining ice location, concentration, and forms (crystals or chemically bound molecules).
- Terrain Navigation
- Equipped to navigate the challenging lunar South Pole terrain, VIPER gathers crucial data contributing to the understanding of the Moon’s history and environment.
Mission Details:
- Duration: 100 Earth days, covering three lunar day-and-night cycles.
- Landing: VIPER is scheduled to land at the Moon’s South Pole in late 2024.
-Source: Indian Express
