According to the 2023-24 annual report of the Department of Personnel Training (DoPT), the Central Bureau of Investigation (CBI) investigated complex cyber crimes with national security implications.

• CERT-In Report of 2023:  According to the Indian Computer Emergency Response Team (CERT-In), cybersecurity incidents rose sharply, reaching 15,92,917 cases in 2023 compared to 53,117 in 2017.

Key Highlights of the Department of Personnel Training (DoPT) Report, 2023

• Attacks that Occurred in 2023: 

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• • Ransomware Attack on Defence Unit: A critical Indian defence unit was targeted by a ransomware attack.
  • Data Breach: A significant data breach exposed sensitive information of millions of Indian citizens.
  • Malware Attack in a Government Ministry: A government ministry suffered a malware attack, potentially compromising sensitive information.
  • DDOS Attack on Critical Infrastructure and Airports: A massive Distributed Denial-of-Service (DDOS) attack targeted critical infrastructure, including airports.
• Cross-Border Cybercrime Investigations: The CBI collaborated with international agencies, including the Federal Bureau of Investigation (FBI), Royal Canadian Mounted Police (RCPM), and Singapore Police, to dismantle fraudulent networks, notably:
  • Uncovering a $2 million cryptocurrency scam linked to fake tech support.
  • Identifying a Delhi-based call centre scamming Canadian citizens.
  • Tracing cryptocurrency fraud involving tax evasion by an Australian citizen to India.
• Cyber Fraud in Investment and Loan Apps: The CBI investigated fraudulent loan and investment apps targeting Indian citizens, often operated from neighbouring countries.
• • At the instance of RBI [Reserve Bank of India], CBI registered a case of IMPS (Immediate payment service) fraud at UCO Bank involving reversed transactions across multiple banks, amounting to a staggering ₹820 crore.

About Cyber Attacks

• Definition: A cyberattack is any intentional effort to steal, expose, alter, disable, or destroy data, applications, or other assets through unauthorised access to a network, computer system or digital device.
  • They can target individuals, organisations, or even entire nations, with motives ranging from financial gain to espionage, hacktivism, or simply disruption.

Types of Cyber Attacks

• Malware: Malicious software, like viruses, worms, and ransomware, that infiltrates systems to steal data, corrupt files, or hold data hostage.
  • Ransomware: Ransomware is sophisticated malware that uses strong encryption to hold data or systems hostage. 
    • It blocks access to systems through malware until a ransom is paid.
• Phishing: Phishing messages are often designed to look as though they’re coming from a legitimate source. 
  • Example: The Ayushman Bharat phishing attack deceives users by falsely claiming free health insurance under a government scheme, tricking them into sharing personal information via a fraudulent link.
• Man-in-the-Middle (MitM): Intercepting and altering communications between two parties, often to steal data or inject malware.
  • Example: In 2017, credit reporting agency Equifax was the victim of a man-in-middle attack due to an unpatched vulnerability in its web application framework. 
    • The attack exposed the financial information of nearly 150 million people.
• SQL Injection: Exploiting vulnerabilities in a database to manipulate or steal data.
  • Example: In 2008, Heartland Payment Systems, a major U.S. payment processing company, suffered an SQL injection attack.

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India and Its Vulnerability To Cyber Attacks

• Rapid Digitisation of India: India is the second-fastest digitising economy amongst 17 leading economies of the world and has the potential to create up to $1 trillion of economic value from the digital economy in 2025.
  • There were 751.5 million internet users in India at the start of 2024, when internet penetration stood at 52.4 percent.
  • The massive scale of digitisation and expanding digital footprint significantly increases the vulnerability to cyber attacks.

• According to India Cyber Threat Report 2023, released by the Data Security Council of India (DSCI) and Quick heal: 
  • Total Detections: Over 400 million detections across approximately 8.5 million Endpoints.
  • Detection Rate: Averaging 761 detections per minute.
  • Ransomware Incident Ratio:  1 per 650 detections
  • Malware Incident Ratio:  1 per 38,000 detections · 
• As per a cybersecurity firm Zscaler, India Recorded 79 Million Cyber Attacks In 2023, and ranked as the third-largest country globally for phishing attacks after the US and UK.
  • The technology sector saw the highest volume of attacks, accounting for almost 33 percent of the phishing attacks observed in the country.

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Consequences of Cyber Attacks For India

• Data Breaches: Loss or exposure of personal, financial, or proprietary data can lead to identity theft, fraud, and financial loss.
  • ICMR Data Breach: In October 2023, American cyber security and intelligence agency ‘Resecurity’ had issued an alert that the Indian Council of Medical Research (ICMR) had suffered a data leak of the Aadhaar and passport information of 81 crore Indians, along with their names, phone numbers, and addresses.
• Financial Costs: Direct costs from theft, ransom payments, and operational disruptions, plus long-term impacts like lost trust and legal penalties.
  • Example: WazirX, one of India’s leading cryptocurrency exchanges, recently faced a significant security breach, resulting in a loss of over $230 million
• National Security Threats: Attacks on critical infrastructure like power grids, water supply systems, and healthcare facilities can have serious implications for public safety.
  • Example: In 2019, malware attributed to North Korea’s Lazarus group had infected a system on the administrative network of Kudankulam Nuclear Power Plant in India.
• Cyber Espionage: Cyber Espionage refers to the use of digital tools to spy on or steal sensitive information from governments, organisations, or individuals, often for political, military, or economic gain.
  • Example: Operation SideCopy (Pakistan linked hackers) targeted Indian military and critical Infrastructure Public Sector Undertakings (PSUs) in India.
• Negative Perception of Technology: A high-level cyber incident can lead to widespread mistrust of technology, causing 
  • Reluctance to adopt new tools such as 5G, Internet of Things (IoT), and Artificial Intelligence, 
  • Loss of confidence in tech providers,
  • Slowdown in Foreign Investment in the Tech Sector and
  • Increased regulatory scrutiny.
• Psychological Impact: Victims may experience depression, embarrassment, shame, or confusion.

Challenges in Cyber Security For India

• Rising Cyber Threats: The volume and sophistication of cyber-attacks, including ransomware and DDoS, have surged, posing significant challenges for defence.
• Skilled Workforce Shortage: There is a severe shortage of cybersecurity professionals, impacting response and prevention capabilities.

• • According to the World Economic Forum Cybersecurity Head, India has a shortage of 8 lakh cybersecurity professionals in 2024.
• Inadequate Infrastructure: Many critical sectors still lack proper cybersecurity measures, leaving them vulnerable to attacks.
  • Example: 2023 cyberattack on the Indian Council of Medical Research (ICMR) exposed vulnerabilities in healthcare systems.
• Low Awareness: Limited understanding of cybersecurity risks among citizens and organisations increases vulnerability to threats.
  • The Urban Rural Digital Divide also increases the severity of the problem.
    • Example: According to government data, there were 84,000 cases of UPI fraud in 2021-22, and in 2020-21, 77,000 such cases were recorded.
• Concerns of DarkNet: The darknet is a part of the internet that is intentionally hidden and inaccessible through standard web browsers.
  • Unlike the surface web, which is indexed by search engines, the darknet operates on encrypted networks and requires specific software, such as Tor (The Onion Router) or I2P (Invisible Internet Project), to access. 
  • These tools anonymise user activity by routing traffic through multiple servers, making it difficult to trace.
    • Example: The darknet fuels cybercrime by providing an anonymous marketplace for leaked data, hacking tools, phishing kits,and professional hacking services for a fee.

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Measures Taken By India To Enhance Cyber Security

• National Security Council Secretariat (NSCS): Recently, the National Security Council Secretariat (NSCS), which reports to the National Security Adviser (NSA), has been designated as the agency responsible for overall coordination and strategic direction for Cyber Security.
  • The Ministry of Electronics and Information Technology (MeitY) has been assigned as the nodal body for telecom network security.
  • The Ministry of Home Affairs (MHA) as the nodal body for matters related to cyber crimes.
• India Achieves Tier 1 Status in Global Cybersecurity Index 2024: India has achieved Tier 1 status in the Global Cybersecurity Index (GCI) 2024 by the International Telecommunication Union (ITU), scoring 98.49 out of 100. 
  • This places India among global leaders in cybersecurity, recognised for its commitment to high standards and practices.
• Indian Cyber Crime Coordination Centre (I4C): Provides a framework and ecosystem for Law Enforcement Agencies (LEAs) to deal with cyber crimes in a comprehensive and coordinated manner.
• National Cyber Crime Reporting Portal: To enable the public to report incidents pertaining to all types of cyber crimes, with a special focus on cyber crimes against women and children. 
• Defence Cyber Agency (DCyA): It is an integrated tri-services agency of the Indian Armed Forces. Headquartered in New Delhi, the agency is tasked with handling cyber security threats.
• Computer Emergency Response Team (CERT-In): The national agency responsible for responding to and mitigating cybersecurity incidents. It issues alerts and advisories to the public and private sectors to enhance cybersecurity awareness.

Way Forward

• Build Robust Cybersecurity Infrastructure: Upgrade the National Critical Information Infrastructure Protection Centre (NCIPC) and the National Cyber Coordination Centre (NCCC) for effective cyber response.
• Enhance Skill Development and Address Workforce Gaps: The Data Security Council of India has forecast that the cybersecurity ecosystem will expand up to a point where nearly one million professionals will be required by 2025.
  • Example: Ensuring effective enrollment and completion of Cyber Threat Management Courses under Skill India.
• International Collaborations: India needs to engage more with other countries and international organisations, such as the United Nations, the International Telecommunication Union, the Interpol etc for better coordination and exchange of best practices. 
  • The first-ever US-India Cyber Security Initiative was launched in February, 2024 to unite top cyber security experts globally to create jobs and develop cutting-edge solutions.
• Update Cybersecurity Policies: Update and effectively implement the National Cyber Security Policy to address current cybersecurity challenges.
• Adoption of Cyber Hygiene Practices: Cyber hygiene, or cybersecurity hygiene, is a set of practices organisations and individuals perform regularly to maintain the health and security of users, devices, networks and data
  • Example: Regular software updates, strong password management, and secure online behaviour.
• Encourage Adoption of Cyber Insurance: To cover the financial losses that result from cyber events and incidents. 

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Conclusion

Tackling cybercrime in India demands advanced cybersecurity, public awareness, international cooperation, and a strong legal framework to protect individuals, businesses, and digital infrastructure.

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The Reserve Bank of India (RBI) has released an operational framework for reclassifying investments by foreign portfolio investors (FPI) to foreign direct investment (FDI) when certain limits are breached.

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Key Highlights of the RBI Framework for Reclassifying FPI to FDI

• FPI Investment Limit: Under the Foreign Exchange Management Act (FEMA), foreign portfolio investors (FPIs) are permitted to hold up to 10% of a company’s total paid-up equity capital.
  • If an FPI or its investor group breaches this limit, reclassification to foreign direct investment (FDI) becomes mandatory.
• Options for FPIs Breaching the 10% Limit: FPIs that exceed the 10% threshold must either divest their excess holdings or reclassify their investment as FDI.
  • They have a five-day window from the date of trade settlement to comply with this requirement, according to RBI guidelines.
• Conditions for Reclassification: Once reclassified, the entire investment by the FPI will be deemed FDI and will remain categorised as such, even if holdings drop below the 10% threshold later on.
  • For reclassification purposes, the FPI and its investor group will be treated as a single entity.
• Required Government Approvals: The FPI seeking reclassification must secure necessary approvals from the Indian government, especially for investments originating from countries that share a land border with India.
  • Additional approvals are needed if the beneficial owner of the investment is a citizen or resident of these bordering countries as they require a Government Route for any type of FDI.
• Relaxation for Non-Bordering Country Investors: Investors from countries not subject to this policy are only required to notify the RBI post-transaction, without the need for prior government permission.
• Coordination with SEBI: Alongside RBI, SEBI has issued its own circular detailing the procedure for FPI to FDI reclassification, ensuring regulatory alignment and procedural clarity.

Types of Foreign Investment

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FDI Trends in India for FY 2023-24

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The Ministry of Home Affairs (MHA) has sanctioned the creation of the first-ever all-woman battalion for the Central Industrial Security Force (CISF).

• CISF proposed an all-woman battalion in early 2023 following Union Home Minister Amit Shah’s direction at the force’s 53rd Raising Day in March.

About All Women CISF Battalion

• Structure: The new battalion will consist of over 1,000 personnel and will be led by a senior commandant-rank officer.
  • The battalion will join the existing 12 reserve battalions within CISF, which currently include both male and female personnel.
• Purpose and Duties of the All-Woman Battalion: This exclusive unit is intended to address the increasing responsibilities of CISF in protecting VIPs, airports, Delhi Metro, and other critical installations.
  • The all-woman battalion will be trained to perform diverse roles, including VIP security and security at various high-risk facilities
• Formation and Structure of the Battalion: The unit will be established within the already sanctioned manpower of CISF, which totals around two lakh personnel.
• Training and Recruitment:  Special training programs are being developed to equip the battalion with elite skills for a wide range of security functions.
  • Preparations are underway to recruit, train, and determine the stationing location for the new battalion.

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Encouragement for Women Aspirants

• The establishment of a Mahila battalion is expected to encourage more young women across the country to join CISF.
• It will create a new identity for women in the force, enhancing the appeal of CISF as a career choice for women.
• Women make up more than 7% of CISF personnel and are already deployed at high-profile sites, including 68 civil airports, the Delhi Metro, and heritage sites like the Taj Mahal and Red Fort.

About CISF

• CISF is an armed force of the Union established under an Act of Parliament, “Central Industrial Security Force Act, 1968 ”.
  • The strength of the force, established with the help of 3129 personnel in 1969, was increased to 1,77,713 in 2024
• Headquarters and Governance: Headquarters is located in New Delhi and works directly under the Union Ministry of Home Affairs.
• Organisational Structure: Led by a Director-General (IPS officer) and assisted by an Additional Director-General (IPS officer).
• Divided into seven sectors: Airport, North, North-East, East, West, South, and Training.
  • Includes a specialised Fire Service Wing making it the only Central Armed Police Force (CAPF) with a dedicated fire wing.

Functions and Responsibilities of CISF

• Critical Infrastructure Protection:CISF provides counter-terrorism security for critical infrastructure, including nuclear and aerospace facilities.
• Airport Security: Responsible for airport security since 2000, post the IC-814 hijacking incident.
• Heritage and Public Spaces: Protects iconic monuments, the Delhi Metro, Parliament House Complex, and Central Jails in Jammu and Kashmir.
• VIP Security: Provides security to high-profile individuals.
• Expanded Mandate (Post-2008): Following the Mumbai terror attacks, the mandate broadened to include private corporate security and consultancy services.
• Consultancy Services: Provides security consultancy to private sector entities such as Infosys Offices and Reliance Refinery.

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Woman in combat role

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Retail Inflation reached a 14-month high  to 6.2% in October, up from 5.5% in September, driven by a 10.9% increase in food prices.

• This level marks a breach of the RBI’s upper tolerance limit for inflation, with rural inflation higher at 6.7%, compared to urban inflation at 5.6%.

Key Highlights of the Inflation

• Food Price Changes: The rise in food inflation in October was significant across key items such as Vegetables (42.2%), Edible Oils(9.5%) and Fruits(8.4%).
  • A global supply disruption in Southeast Asia led to a 27% increase in edible oil prices, contributing to the sharp domestic inflation.
  • For Pulses inflation eased to 7.4%, ending a 17-month stretch of double-digit increase
  • Spices saw a price decline of 7%.
• Core Inflation Remains Moderate: Core inflation (excluding food and energy) remained stable below 4% for the 11th consecutive month, with a mild rise from September’s nine-month high of 3.8%.
• Consumer Price Index (CPI) Changes: The overall CPI increased by 1.3% from September, with rural areas seeing a slightly higher increase of 1.42%.
• Consumer Food Price Index (CFPI) Changes : The CFPI, which tracks food inflation, rose 2.6% with similar effects in both rural and urban areas.
• RBI’s Inflation Projections: The RBI had projected average inflation at 4.8% for Q3 of FY 2024-25, dropping to 4.2% in Q4.
  • However, to meet these projections, inflation would need to significantly soften to around 4.1% in November and December.
• Impact on Monetary Policy: Economists suggest that the sharp rise in inflation rules out any possibility of an interest rate cut in the RBI’s December monetary policy review.

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About Inflation

• Inflation refers to the rise in the prices of most goods and services of daily or common use, such as food, clothing, housing, recreation, transport, consumer staples, etc. 
• It measures the average price change in a basket of commodities and services over time. 
• Inflation is indicative of the decrease in the purchasing power of a unit of a country’s currency. This is measured in percentage.
• Importance: A certain level of inflation is required in the economy to ensure that expenditure is promoted and hoarding money through savings is demotivated.

Types of Inflation

• Headline Inflation: Headline Inflation is a measure of the total inflation within an economy, including commodities such as food and energy prices (e.g., oil and gas), which tend to be much more volatile and prone to inflationary spikes.
  • Wholesale Price Index (WPI) in India is known as headline inflation.
• Core Inflation: Core inflation is the change in the costs of goods and services, but it does not include those from the food and energy sectors.
  • This measure of inflation excludes these items because their prices are much more volatile.
• Disinflation: Disinflation refers to a decrease in the rate of inflation, meaning prices are still rising but at a slower pace.
• Stagflation: Stagflation is a unique combination of high inflation and stagnant economic growth, accompanied by high unemployment.

How is Inflation measured?

In India, inflation is primarily measured by two main indices WPI (Wholesale Price Index) and CPI (Consumer Price Index), which measure wholesale and retail-level price changes, respectively.

About Consumer Price Index (CPI) – Retail Inflation

• CPI Measures the change in the retail prices of goods and services with reference to a base year.
• Compiled by: National Statistics Office (NSO), Ministry of Statistics and Programme Implementation (MoSPI).
• Types of CPI:
  • CPI for Industrial Workers (CPI-IW)
    • Compiled by the Labor Bureau.
    • Base year: 2016.
  • CPI for Rural Laborers and Agricultural Laborers (CPI-AL & CPI-RL)
    • Compiled by the Labor Bureau.
    • Base year: 1986-87.
  • New CPI (Rural, Urban, and Combined):
    • Base year: 2012.
    • Compiled and published by the Central Statistical Organisation (CSO) for all-India levels.

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Consumer Food Price Index (CFPI)

• CFPI: It is a sub-component of CPI, measuring changes in retail prices of food items consumed by the population.
• Focus: Tracks price changes of food staples such as cereals, vegetables, fruits, dairy, meat, etc.
• Compiled by: Central Statistical Office (CSO), MoSPI (from May 2014), now under NSO (formed in 2019).
• Base year: 2012.
• Methodology: Calculated monthly, using the same methodology as CPI.

Wholesale Price Index (WPI)

• WPI : It measures the average change in wholesale prices before the retail level.
• Coverage: It covers only goods, excluding services.
• Compiled by: Office of Economic Advisor, Ministry of Commerce and Industry (on a monthly basis).
• Base year: 2011-12.
• Weightage: Weights assigned to commodities are based on production value adjusted for net imports.

Impact of Food Inflation

• Psychological Stress: Rising prices, especially for essential items like vegetables and fruits, can lead to significant stress and anxiety among consumers.
• Impact on Health: Increased food prices can lead to reduced food consumption, particularly among vulnerable populations, impacting nutritional intake and overall health
• Impact on Economy: Food Inflation distorts overall inflation target of RBI limiting its ability to use monetary measures.

Government Measures to Control Food Inflation

• Subsidised Sales: Government-subsidised sales of essential commodities like onions, tomatoes, wheat, and sugar to control prices.
• Import Duty Reduction: Reducing import duties on pulses to increase domestic supply.
• Export Bans: Temporary bans on exports of wheat and broken rice to ensure domestic availability.
• Stockpiling Restrictions: Limits on stockpiling by traders to prevent hoarding.
• Operation Greens: A government initiative to stabilise the supply and prices of tomatoes, onions, and potatoes.
• Minimum Export Price: Imposing a minimum export price on food items to curb exports and maintain domestic supply.

Monetary Policy Measures to Control Inflation

• Increasing Interest Rates: This reduces borrowing and spending, cooling down demand.
• Cash Reserve Ratio (CRR) Hike: Banks are required to hold more funds with the central bank, reducing lending capacity.
• Open Market Operations (OMO): Selling government securities to absorb excess liquidity.

Fiscal Policy Measures to Control Inflation

• Reduced Government Spending: Cutting back on public expenditure to lower aggregate demand.
• Increased Taxes: Raising taxes to reduce disposable income and consumption.
• Supply-Side Measures: Promoting domestic production, improving infrastructure, and streamlining regulations to boost supply and reduce inflationary pressures.

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Way Forward

• Investment in Agriculture: Investing in infrastructure, markets, and supply chains to improve food production and reduce price volatility.
• Risk Management Tools: Implementing effective risk management strategies to protect farmers, traders, and consumers from price fluctuations and climate-related risks.
• Climate-Smart Agriculture: Adopting sustainable agricultural practices to mitigate the impact of climate change on food production.
• Institutional Forecasting: Establishing a robust forecasting mechanism to provide accurate information to farmers and policy-makers.
• Supply-Side Reforms: Addressing structural issues in the agricultural sector to improve productivity and efficiency.

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Recently, India’s Defence Research and Development Organisation (DRDO) successfully conducted the first flight-test of the Long Range Land Attack Cruise Missile (LRLACM).

DRDO Successfully Tests Long Range Land Attack Cruise Missile

• Test Conducted: DRDO conducted the test at Integrated Test Range (ITR), Chandipur, Odisha.
• Approval: The Defence Acquisition Council approved the procurement of LRLACM in July 2020.
• Variant : It is a new variant of the Nirbhay LRLACM with improved features.
• Developed By: The Aeronautical Development Establishment (ADE), Bengaluru.
  • ADE is a key Aeronautical Systems Design House of DRDO involved in the design and development of the state-of-the-art Unmanned Aerial Vehicles and Aeronautical Systems and technologies.
• Performance: The missile demonstrated precision waypoint navigation, executed complex manoeuvres at varying altitudes and speeds and adhered to planned objectives.

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About Nirbhay LRLACM

• The Long Range Land Attack Cruise Missile is a Mission Mode Project and can be launched from the ground using a mobile articulated launcher and also from frontline ships using a universal vertical launch module system.
• Type and Range: Nirbhay is a sub-sonic, long-range cruise missile with a strike range of up to 1,000 kilometres, designed for precision targeting from stand-off distances, ensuring operator safety.
• Launch and Propulsion: Nirbhay uses a solid-fuel booster for initial launch, after which it transitions to a turbojet engine for sustained, long-distance flight.
• Precision Strike: It is designed for deep penetration, allowing it to target high-value assets with high accuracy.
  • It is equipped with Radar, electro-optical tracking systems, and telemetry equipment for improved precision.
• Loitering and Low-Altitude Flight: The missile can loiter (stay airborne) before striking and can operate at very low altitudes, approximately 100 metres, to avoid detection and enhance effectiveness.
• Warhead Options: Nirbhay is capable of carrying both conventional and nuclear payloads, with a warhead capacity ranging from 200 to 300 kg, making it versatile for different mission requirements.
• Strategic Capability : Allow long-distance strikes against strategic targets with terrain-hugging flight paths and subsonic speeds enhancing stealth and defence penetration.
• Naval Defence Capability : Has a range of over 1,000 km, with sea-skimming capabilities for enhanced naval operations.
• Global Comparisons: It is Similar to the US Tomahawk & Russia’s Kalibr in precision and long-range capabilities.

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Cruise Missiles Vs Ballistic Missiles 

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Countries assembled in Baku for the annual climate conference, COP29, voted to clear a much-delayed agreement to finalise a global carbon market. 

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About Global Carbon Market

• A Global Carbon market will allow countries to trade carbon credits for certified reductions of carbon emissions among themselves. The prices of these instruments are determined as a consequence of emission caps imposed by countries.
• Aim: To finalise a global carbon market facilitating trade in carbon credits among countries to meet climate targets.
• Background: Article 6 of Paris Agreement provides mechanisms for countries and companies to collaborate in reducing carbon emissions and meet their climate action goals formally known as nationally determined contributions (NDCs).
• Carbon market: Derived from Article 6 of the Paris Agreement which outlines mechanisms for international carbon credit trading. 

• Bilateral Carbon Trade: Article 6.2 Allows for bilateral trading between countries.Framework of Carbon Trade:  Article 6.4 sets the framework for a global market supervised by a UN body.
• Carbon Credit Integrity : A UN supervisory body has developed draft standards for assessing and ensuring genuine carbon credits.
• Operationalizing the Market: The first UN-sanctioned carbon credits will be available by 2025. Significance of Global Carbon Market:
• Economic Impact : Finalising Article 6 negotiations could reduce the cost of implementing national climate plans by $250 billion per year.
• Stricter Standards:The introduction of downward adjustments to project baselines is aimed at preventing inflated claims. 
• Real Impact: Only projects that achieve real and additional reductions in emissions will earn carbon credits.
• Loss and Damage Fund: Activate the Loss and Damage Fund to support vulnerable nations affected by climate change.Expected to start disbursing funds in 2025.

Difference between Compliance-based and Voluntary Carbon Credit Trading

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About Carbon Credit Trading Scheme (CCTS) in India

• The Carbon Credit Trading Scheme (CCTS) is a statutory framework established under the Energy Conservation (Amendment) Act, 2022 in India.
• The Act designates the Bureau of Energy Efficiency (BEE) as the nodal authority for overseeing the scheme’s implementation and compliance.
• It is designed to facilitate the creation of a domestic carbon market, aligning with India’s climate commitments under the Paris Agreement.
• The CCTS aims to provide an economic mechanism for reducing greenhouse gas (GHG) emissions by enabling the trade of carbon credits across industries.

Institutional Framework for Carbon Trading in India

• National Steering Committee for Indian Carbon Market (NSCICM): Established by the Central Government under the Carbon Credit Trading Scheme (CCTS).
  • It comprises members from various ministries and relevant organisations, chaired by the Secretary, Ministry of Power, with co-chairmanship by the Secretary, Ministry of Environment, Forest, and Climate Change.
  • It Recommends procedures, rules, and regulations for institutionalising and operating the Indian carbon market.
  • Sets emission targets, develops trading guidelines, and oversees the market’s operations.
  • Advises on the issuance, renewal, or expiry of carbon credit certificates.
• Bureau of Energy Efficiency (BEE): Acts as the administrator of the CCTS and identifies sectors for GHG emission reduction, setting targets and issuing carbon credits. It also Manages carbon credit certification and market stability mechanisms.
  • Accredits verification agencies and determines fees and charges for implementation costs.
  • Maintains IT infrastructure, data security, and stakeholder capacity-building activities.
• Grid Controller of India (GCI): It Registers entities and manages their carbon credit accounts.
  • Facilitates trading and maintains a secure database, functioning as a meta-registry for the Indian carbon market.
• Central Electricity Regulatory Commission (CERC): It regulates trading activities under the Indian Carbon Market.
  • It also approves power exchange business regulations for trading.
  • Provides market oversight and enforces corrective actions to prevent fraud.
• Accredited Carbon Verification Agency (ACVA): Conducts validation and verification of GHG reduction activities.
  • Accredited by BEE, following detailed eligibility criteria and procedure.

Limitations of India’s Carbon Trading System

• Limited Coverage: Excludes major polluting sectors like electricity and agriculture, reducing its overall impact.
• Delayed Implementation: Potential economic costs due to delayed rollout, especially with global carbon pricing mechanisms like CBAM.
• Effectiveness and Timing: May take several years to significantly reduce emissions, and the effectiveness hinges on the system’s design and coverage.
• Questionable Exclusions: The exclusion of major polluting sectors raises concerns about the system’s ability to drive substantial emissions reductions.
• Greenwashing: Projects overstating environmental benefits, especially in forestry.
• Lack of Stringent Verification: Inadequate checks on carbon sequestration claims.
• Additionality Concerns: Projects claiming credit for activities that would have happened anyway.

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Measures to Improve Carbon Trading

• Robust Verification Protocols: Strict verification procedures and a central registry to prevent double-counting.
• Learning from International Best Practices: Adopting standards from organisations like the Gold Standard.
• Alignment with Global Standards: Integrating with Article 6 of the Paris Agreement and preventing double-counting.
• Transparency and Disclosure: Detailed project information, third-party verification, and real-time tracking of credit transactions.

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Uzbekistan: Geographical and Natural Resource Overview

• Location: Uzbekistan is a landlocked country in Central Asia, lying mainly between two major rivers. the Syr Darya to the northeast and the Amu Darya to the southwest. 
• Double Landlocked Nation: It is one of only two doubly landlocked countries in the world, with Liechtenstein as the other.
• Its coordinates place it in the Northern and Eastern hemispheres of the Earth.
• Neighbouring Countries: Uzbekistan shares borders with five countries:
  • Kazakhstan to the north and northwest
  • Kyrgyzstan to the northeast
  • Tajikistan to the southeast
  • Afghanistan to the south
  • Turkmenistan to the southwest
• Geographical Features: The country’s topography is dominated by approximately 80% sandy desert, primarily the Kyzyl Kum Desert, along with vast lowlands in the west. 
• The southeastern and northeastern regions have foothills and lower mountains belonging to the Tian Shan range, an extension of the Himalayas. 
• Highest Point: The highest peak, Adelunga Toghi (4,301 m), is situated in the northeast. 
• The Fergana Valley, between mountain ranges, is considered to have the best agricultural land and climate in Central Asia.

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• Rivers and Lakes:
  • Amu Darya and Syr Darya are Uzbekistan’s major rivers.
  • The Aral Sea, shared with Kazakhstan, is severely diminished due to water mismanagement, representing one of the world’s greatest environmental crises.
  • Key lakes include Lake Aydarkul and Lake Sarykamish.
• Vegetation: The dominant vegetation is desert scrub due to the arid landscape. However, fertile regions like the Fergana Valley support intensive agriculture.
• Natural Resources: Uzbekistan’s natural resources include substantial reserves of natural gas, petroleum, coal, and mineral deposits such as gold, uranium, and copper.
  • It has the Fourth Largest Gold Reserve in the world.

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Indian Defence Minister has announced the creation of an ‘Adaptive Defence’ to address emerging challenges in today’s fast-changing world.

• Significance: Described as not just a strategic choice, but a necessity.

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Concept of Adaptive Defence

• A strategic approach where military and defence mechanisms continuously evolve to effectively counter emerging threats.
• Proactive Preparation: Involves anticipating potential threats and preparing for them proactively.
• Key Elements: Situational awareness, strategic and tactical flexibility, resilience, agility, and integration with futuristic technologies.

Status of Defence Exports

• India’s defence exports are growing:
• In 2023-24, India exported defence items to over 100 countries.
• Top three export destinations: USA, France, and Armenia.
• Export target: ₹50,000 crore worth of defence exports by 2029.

What are Emerging Technologies?

• Emerging technologies are new technologies whose development and practical applications are not realised yet. 
  • It can be both new technology or advancement of existing technology. 
• Examples of Emerging Technologies in Defence
  • Drones and Swarm Technologies: These technologies have brought changes in the warfare methods. 
  • Artificial Intelligence (AI) and Machine Learning (ML): These technologies help in threat detection. 
  • Cyberse warfare technologies: The defensive technologies help in protecting critical data and command systems from cyber attacks. 

Impact of Emerging Technologies

• Drones and Swarm Technologies: These technologies are revolutionizing warfare tactics and strategies.
• Cyber Warfare: The digital domain is becoming a new battleground because cyberattacks are posing significant threats to critical infrastructure and national security.
• Artificial Intelligence (AI): AI can enhance decision-making, automate tasks, and develop autonomous weapons systems.
• Quantum Technologies: Quantum computing and cryptography have the potential to disrupt traditional encryption methods and cyber security.
• Nanotechnology: Nanotechnology can be used to develop advanced materials and devices with military applications.
• India’s stance
  • Drone Hub: India aims to become a global drone hub, promoting domestic manufacturing and innovation.
  • Make in India: The government is focused on boosting domestic defense manufacturing and reducing reliance on imports.
  • Defence Exports: India is increasing its defense exports to various countries, including the US, France, and Armenia.
  • International Collaboration: India is seeking to collaborate with other countries to address emerging security challenges and share knowledge and expertise.

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Why is a collaborative approach essential in current geopolitical dynamics?

• Geopolitical dynamics and cross-border issues necessitate a collaborative approach to defence.
• Collaboration is essential due to ambiguities in cyberspace, AI, and the potential of quantum and nanotechnologies.
• Sharing knowledge, perspectives, information, and strategies is crucial.

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Recently, The Inter-State Council has been reconstituted with Prime Minister Narendra Modi as the chairman.

• The Standing Committee of the Inter-State Council (ISC) was also reconstituted with Home Minister Amit Shah acting as its chairman.

Structure of the Reconstituted Council

• Chairman: Prime Minister
• Members: The Chief Ministers of all the States and union territories having a legislative assembly and administrators of union territories not having a legislative assembly.
• • Nine Union ministers will also serve as members of the council
• Permanent Invitees: 13 Union ministers as permanent invitees.

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About The Standing Committee of the Inter-State Council (ISC)

• Members: It will include 12 other members of which senior Union ministers and chief ministers from seven states, including Maharashtra, Odisha, and Andhra Pradesh are included.
• Function: 
• • To facilitate continuous consultations on issues considered by the broader Inter-State Council. 
  • It is responsible for reviewing and processing issues related to Centre-State relations before it being presented to the ICS
  • The committee also monitor the implementation of ISC recommendations

About the Inter-State Council

• The Inter-State Council is a Non Permanent Constitutional body set up under Article 263 of The Constitution of India.
• Establishment: The  ISC was first established on 28 May 1990 by a presidential order on recommendation of the Sarkaria Commission.
• Aim: The body is constituted to encourage dialogue, resolve disputes, and address concerns related to federal governance and inter-state cooperation.
• Responsibilities:
  • Dispute Resolution between Centre-States: The ISC acts as a mediator in resolving disputes between States by facilitating discussions, and provides recommendations for amicable settlements.
  • Collaborative Policymaking: The council serves as a platform to discuss and investigate subjects of common interest to multiple States or the Union or one or more States leading to coordinated policy decisions.
  • Policy Coordination and Recommendations: The ISC makes recommendations on various subjects and issues which promote consistent and effective implementation of policies across the country.
• Role in Promoting Cooperative Federalism: 
  • Facilitating Policy Coordination: ISC provides an effective forum for dialogues,  discussing policies and resolving disputes between states and the central government.
    • Example: ISC was involved in coordinating the implementation of the Goods and Services Tax (GST) across states.
  • Uniformity in Legislation: ISC ensures uniformity in laws across states as it provides a platform for coming together of various governments.
    • Example: ISC discussions led to the alignment of state laws with the central government’s Agricultural Produce Market Committee (APMC) Act reforms.
  • Conflict Resolution: ISC addresses inter-state disputes and recommends measures for amicable solutions.
    • Example: The ISC’s role in mediating the Cauvery water dispute between Karnataka and Tamil Nadu.
  • Strengthening Federal Structure: The forum promotes decentralization by advocating for greater state autonomy in certain domains.
    • Example: Recommendations for decentralizing subjects under the Concurrent List to states, as suggested by the Punchhi Commission.
  • Sharing Best Practices: The ISC is also a forum where the states can deliberate upon the implementation of best practices in other states.
  • Monitoring Implementation: The ISC develops a system to monitor the implementation of its recommendations. 

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• Challenges: 
  • Not a Permanent Body: ISC not being a permanent body  is not mandated to meet at regular time intervals undermining its effectiveness.
    • Example: Despite its establishment in 1990, the ISC has met only a few times, impacting its ability to address ongoing issues.
  • Advisory Role: ISC has limited authority as it has only an advisory function with its  recommendations not binding, limiting its influence.
    • Example: Many recommendations on police reforms and public order remain unimplemented due to their non-binding nature.
  • Resource Constraints: ISC does not possess adequate resources  like necessary staff and financial resources to conduct detailed studies and follow-up actions and administrative support which hampers its effective functioning.
  • Political Will: Political differences and lack of commitment from states and the center hinder ISC’s potential.
    • Example: Political disagreements often delay consensus on critical issues like fiscal federalism and devolution of powers.
  • Functional  Duplication: ISC’s role sometimes overlaps with other inter-governmental bodies, leading to functional duplication.
    • Example:  Overlaps with the National Development Council (NDC) and the Finance Commission reduce the ISC’s distinct utility.

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The Ministry of Home Affairs (MHA) In a notice uploaded on the Ministry’s website has recently listed 17 reasons for denial of registration or renewal under the Foreign Contribution Regulation Act (FCRA), 2010 to NGOs.

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Reasons Cited for Cancellation of Registration or Renewal

• Welfare Orientation: If it was found in the field inquiry that no reasonable activity for welfare of society has been undertaken by the association during the last 2-3 years or the association itself has become defunct.
• Prosecution of Member: If any of the office bearers, members or key functionaries is/are convicted under any law or a pending prosecution for any offence against them.
• Non- Responsive: The association has not responded to official clarifications sought or provided with the requisite information/document(s).
• Improper Application Form: Concealment of facts/information by the Association in its application form or the application Form is incomplete.
• Benami Organisation: If the field inquiry finds office bearers/ Members to be are fictitious/ benami and only for namesake as none are found at the given address provided by the association in its form FC-3C/FC-3A.
• Wrong Address:The association does not exist at the given address provided by the association in its form FC-3C/FC-3A.
• Application Rejected Before: The certificate of registration of the association has already been cancelled. Therefore  the association is not eligible for accepting FC for three years from the date of cancellation.
• Diversion of Funds: Foreign contribution funds are being diverted for carrying out anti-development activities or inciting malicious protests.
• Funds used for Personal Benefit: Field inquiry has revealed the likelihood of utilization of FC funds for undesirable activities or for personal gain by the association or the office bearers.
• Linkage with Anti National Organisation: If the association is involved in adverse activities like involvement in anti-developmental activities,inciting protests with malicious intentions, linkage with terrorist organisation / anti-national organisations etc
• Adverse association: If the association or any of its members has linkages with radical/ terrorist entities.
• Involved in Religious Conversion: If the acceptance of FC funds is likely to affect the social/religious harmony or the association is involved in carrying out forceful religious conversion/ proselytization 
• If the association during the last 05 years has not utilized any FC for projects as per aims and objectives of the association.
• Violation of Section 18 of FCRA 2010: The association has not uploaded the Annual Returns of any of previous 6 Financial Years 
• Association has violated any one or more of the provision of the Act or Rules like,
  • Administrative expenses more than 2O percent 
  • Discrepancy in Annual Returns
  • Not uploaded Bank statements, Income and Expenditure Account, Receipts and Payment account and Balance sheet along with Annual Return
  • Transferred FC to an bank account which is a non-FCRA account 
• Welfare Criteria: Association has not fulfilled the criteria of spending a minimum amount of Rs.15 Lakhs of its core activities for benefits of society during the last O3 Financial Years.
• Defunct: Association is not in existence for 03 years.

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