The annual fiscal cost of leakage in the distribution of food grain to more than 800 million beneficiaries under the free rations scheme is estimated at Rs 69,000 crore, according to ICRIER study.

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Key issue Highlighted in the ICRIER Study

• Excessive Coverage and Economic Burden
  • Current Coverage under the NFSA and PMGKAY: It extends to 57% of the population (813.5 million people out of a population of about 1.43 billion in 2024).
  • Criticism: Critics argue that providing free food to over 800 million people is economically unsustainable.
• Leakages in PDS 
  • A significant issue in the PDS is the leakage of food grains, which prevents them from reaching intended beneficiaries.
  • Extent of Leakages: Approximately 28% of the rice and wheat distributed under the PDS does not reach beneficiaries, resulting in a loss of 19.69 million metric tonnes (MMT) of grains annually (2022-23). 
    • This translates to a financial loss of ₹69,108 crore per year.
  • State Variations: States such as Arunachal Pradesh, Nagaland, and Gujarat have reported some of the highest rates of leakages.
  • Improvements and Challenges: The introduction of Point-of-Sale (PoS) machines at Fair Price Shops has reduced leakages from 46% in 2011-12 to 28% in 2022-23. 
• Nutritional Security Deficiency
  • The current cereal-focused food subsidy system does not adequately address India’s nutritional challenges.
  • Malnutrition Indicators: According to the National Family Health Survey (NFHS) 2019-21:
    • 35.5% of children under five are stunted.
    • 19.3% are wasted.
    • 32.1% are underweight.
  • Cereal-Focused Subsidy: The existing subsidy prioritises cereals, with limited focus on nutrient-rich foods such as pulses, vegetables, and fruits, which are crucial for overcoming malnutrition.
• Fiscal Impact:
  • The food subsidy expense for FY23 was Rs. 2.72 lakh crore, reduced to Rs. 2.12 lakh crore in FY24 (RE).
  • Savings from reduced leakages could be redirected toward agricultural investment and rural development.

More Issues with PDS in India

• Ghost Beneficiaries and Fraud: Despite the introduction of Aadhaar linkage, duplicate and ineligible beneficiaries remain a challenge. 
  • Between 2013-2021, 47 million bogus ration cards were cancelled.
• Targeting Errors: Errors in identifying beneficiaries result in the exclusion of eligible households and the inclusion of non-poor families.
• Storage Losses: The lack of adequate infrastructure leads to 10% of foodgrains being wasted annually due to spoilage.
• Corruption: Corruption at the level of Fair Price Shops (FPSs) leads to practices like under-weighing and overcharging, which reduce the effectiveness of PDS.

About Public Distribution System (PDS)

• The Public Distribution System (PDS) was initially designed to manage food scarcity by distributing essential foodgrains at affordable prices. 
• Over time, it has evolved into a critical component of India’s food security strategy, supplementing household needs for foodgrains but not meeting the entire requirement.

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Management of PDS

• PDS operates under the joint responsibility of the Central and State/UT Governments:
  • Central Government: Handles procurement, storage, transportation, and bulk allocation of foodgrains through the Food Corporation of India (FCI).
  • State Governments: Oversee distribution, identification of eligible families, issuance of ration cards, and supervision of Fair Price Shops (FPSs).
• The system primarily distributes wheat, rice, sugar, and kerosene, though some states include additional items like pulses, edible oils, and salt.

History of Public Distribution

• Public Distribution in the 1960s
• • PDS emerged during the interwar period but gained prominence in the 1960s amid food shortages. 
  • Initially focused on urban areas, its reach expanded to tribal and poverty-stricken regions post-Green Revolution.

• Revamped Public Distribution System (RPDS)
  • Launched in 1992, RPDS aimed to improve PDS accessibility in remote and poverty-stricken areas.
  • Covered 1,775 blocks, focusing on regions under Drought Prone Area Programme (DPAP), Integrated Tribal Development Projects (ITDP), and Desert Development Programme (DDP).
  • Provided additional ration cards, Fair Price Shops, and storage facilities while distributing essential commodities like tea, pulses, and soap.
• Targeted Public Distribution System (TPDS)
  • Introduced in 1997, TPDS shifted focus to the poor. States identified beneficiaries based on poverty estimates, targeting Below Poverty Line (BPL) families.
  • Initially, 72 lakh tonnes of foodgrains were allocated for 6 crore poor families annually.
  • Key developments:
    • In 2000, foodgrain allocation for Below Poverty Line (BPL) families increased from 10 kg to 20 kg per month at 50% of the economic cost.
    • The allocation for Above Poverty Line (APL) families was retained at economic cost, but the Central Issue Prices (CIP) for BPL and Antyodaya Anna Yojana (AAY) beneficiaries were kept subsidized.
    • The number of BPL families increased to 652 lakh in 2000, based on updated population projections.

Relevance and Need for PDS in India

• Food Security and Poverty Alleviation
  • PDS ensures food access for India’s vulnerable populations, particularly as 129 million Indians live in extreme poverty (World Bank, 2024).
  • Acts as a safety net during crises like the COVID-19 pandemic, where schemes like Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) provided free foodgrains to 800 million people.
• Price Stabilization and Market Regulation
  • PDS mitigates price volatility by maintaining buffer stocks and controlling market fluctuations.
  • For instance, in 2022-23, FCI released 34.82 lakh tonnes of wheat to stabilize market prices.
• Agricultural Support
  • Provides assured markets and Minimum Support Prices (MSP), supporting farm incomes and rural livelihoods.
• Nutritional Security
  • Some states now distribute fortified rice, pulses, and millets to combat malnutrition. 
  • For example, Tamil Nadu provides fortified rice, while Odisha promotes millet distribution through its Millets Mission.
• Social Equity and Regional Balance
• • PDS supports marginalized communities, particularly in remote and tribal regions. 
  • Initiatives like One Nation One Ration Card (ONORC) enhance portability for migrant workers.

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Reforms proposed by ICRIER

• Targeted Free Food Coverage: Free food benefits should be restricted to the poorest 15% of the population. 
  • Beneficiaries above the extreme poverty line should pay at least 50% of the MSP for grains, thereby reducing subsidy costs and making the system more sustainable.
• Plugging Leakages in PDS: To address leakages, the use of PoS machines should be expanded across all Fair Price Shops. 
  • Additionally, implementing DBT will ensure that food subsidies are transferred directly into beneficiaries’ accounts, reducing corruption and inefficiency.
  • States like Bihar and West Bengal have achieved significant reductions in PDS leakage over the past decade. 
    • In Bihar, leakage dropped sharply from 68.7% in 2011-12 to just 19.2% in 2022-23. West Bengal saw a decrease from 69.4% to 9% over the same period.
• Nutrition-Oriented PDS: Reforms should focus on making the PDS more nutrition-oriented:
  • Conversion of Fair Price Shops: Selected Fair Price Shops should be converted into “Nutrition Hubs” offering a diverse range of food items, including eggs, pulses, millets, and fruits, alongside cereals.
  • Digital Food Coupons: Beneficiaries should receive digital food coupons that can be redeemed at these Nutrition Hubs, promoting dietary diversity.

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Way Forward

• Digital Transformation: The system can be improved through end-to-end digitalization using technologies like blockchain and IoT for real-time monitoring and AI-based analytics to detect pilferage.
• Modernized Infrastructure: The government should invest in temperature-controlled silos and automated quality control systems to reduce storage losses.
• Strengthening ONORC: Improved interstate coordination and real-time tracking of migrant populations can ensure better portability of ration cards.
• Nutritional Security Focus: The inclusion of millets, pulses, and fortified foods in the PDS can address India’s nutritional challenges. E-Rupee vouchers for nutrition can also be introduced for vulnerable groups.
• Crisis Preparedness: Emergency mobile PDS units should be established to cater to populations affected by natural disasters or pandemics.
• Investment of Savings into Agriculture and Nutrition: Savings from subsidy rationalisation should be redirected towards:
• • Agricultural R&D: Investments should focus on developing high-yield, climate-resilient, and nutrient-rich crop varieties.
  • Climate-Resilient Farming Practices: Emphasis should be placed on sustainable agricultural practices to mitigate the effects of climate change.
  • Farmer Skill Enhancement Programs: Skilling programs for farmers should be prioritised to improve agricultural efficiency and income.

Conclusion

A restructured PDS with targeted free food, DBT for leakages, and diversified nutrition options is critical for addressing poverty and malnutrition effectively. Food subsidy savings must focus on investments that offer long-term returns and improve overall food and nutritional security.

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The Chennai Vladivostok eastern maritime corridor has become operational and is carrying oil, food and machines, Minister of Ports, Shipping and Waterways said at the Sagarmanthan: The Great Oceans Dialogue.

• He also says that India and Greece would work together on the India-Middle East-Europe Economic Corridor (IMEEC) announced last year.

About Chennai Vladivostok Maritime Corridor (VCMC)

• The Chennai Vladivostok Maritime Corridor (VCMC) is a proposed sea route that connects the ports of Chennai and Vladivostok, and is part of the Eastern Maritime Corridor.
  • The route will pass through the Sea of Japan, the South China Sea, the Strait of Malacca, the Bay of Bengal, and the Andaman and Nicobar archipelago.
  • The Eastern Maritime Corridor connects ports on India’s east coast with ports in the far-east region of Russia
• Background: The VCMC was signed in 2019 by Indian Prime Minister Narendra Modi during a visit to Vladivostok, Russia. 
• Location: Vladivostok is Russia’s largest port on the Pacific Ocean, and is located about 50 kilometres from the China-Russia border. 
• Distance: The VCMC is about 5,600 nautical miles long. 
• Purpose: The VCMC aims to improve trade relations between India and Russia, and provide a more cost-effective way to transport goods between the two countries. 
• Benefits: The VCMC could reduce the time it takes to transport cargo between the two countries by up to 16 days. 
  • The Mumbai-St. Petersburg route via the Western Sea Route and Suez Canal spans 8,675 nautical miles, taking 40 days for a container ship to reach Russia’s Far East region.
• Significance: The VCMC could be a strategic move for India and Russia, and could potentially alter the regional balance of power. 
  • However, there are also security implications to consider, such as the potential for heightened tensions in the South China Sea. 

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About India-Middle East-Europe Economic Corridor (IMEEC)

• The India-Middle East-Europe Economic Corridor (IMEEC) was announced during the G20 Summit in New Delhi.
  • A Memorandum of Understanding was signed between the European Union and seven countries, namely India, the United States, Saudi Arabia, the United Arab Emirates (UAE), France, Germany, and Italy.
• Purpose:
• • The IMEEC aims to establish a reliable and cost-effective ship-to-rail transit network to complement existing maritime routes.
  • The corridor is intended to enhance trade efficiency, reduce costs, secure regional supply chains, and foster economic cooperation.
  • It will also help in generating employment opportunities and lowering greenhouse gas emissions.
• Structure:
  • The IMEEC will comprise two separate corridors:
    • The Eastern Corridor will connect India to the Gulf.
    • The Northern Corridor will link the Gulf to Europe.
  • The corridor will include:
    • A shipping route connecting Mumbai and Mundra (Gujarat) to the UAE.
    • A rail network connecting the UAE, Saudi Arabia, and Jordan with the Israeli port of Haifa, leading to the Mediterranean Sea.
    • A sea route from Haifa to Piraeus (Greece) and onward to Europe.
  • Additional infrastructure will include undersea cables for data transmission and long-distance hydrogen pipelines to support climate and decarbonization goals.

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High temperatures and reduced salinity in Sambhar lake may have created conditions conducive to avian botulism, resulting in the mass deaths of migratory birds in Rajasthan.

• At least 600 migratory bird deaths were reported by the Centre for Avian Research Institute earlier this month.

About Avian Botulism

• Avian botulism is a neuro-muscular disease caused by Botulinum, a natural toxin produced by the bacterium Clostridium botulinum. 
• Habitat of Bacteria: Clostridium botulinum is commonly found in soil, rivers, and seawater, and affects both humans and animals.
• Growth Conditions: The bacteria thrive in anaerobic (oxygen-free) environments and do not grow in acidic conditions.
• Impact on Birds: It affects the nervous system, causing paralysis in the legs and wings of birds.
• Prevalence in Wetlands: Bacterial spores are prevalent in wetland sediments and are found in wetland-dwelling invertebrates like insects, mollusks, and crustaceans, as well as healthy vertebrates, including birds.
• Trigger Conditions: Outbreaks often occur when temperatures exceed 21°C and during drought conditions.
• Management and Challenges
  • Treatment Limitations: Avian botulism cannot be treated; prompt removal and proper disposal of affected birds are essential to prevent the spread.
  • Past Incidents: A similar outbreak in Sambhar Lake in 2019 caused the deaths of nearly 18,000 birds.
  • Predictability: Outbreaks are difficult to forecast as they depend on specific environmental conditions, such as shifts in salinity coinciding with the arrival of migratory birds.
• Vulnerability of Migratory Birds
  • Susceptibility: Migratory birds arriving after long flights are often weakened, making them more prone to diseases like botulism.
  • Role of Carcasses: Decaying bird carcasses attract maggots, which can contaminate water sources and infect other birds and animals.

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About Sambhar Lake

• Location: Situated about 80 km southwest of Jaipur, Rajasthan.
• Geographical Significance: It is India’s largest inland salt lake and represents a depression in the Aravalli Range.
• Fauna: Flamingoes, pelicans and the waterfowls are commonly sighted at the Sambhar Lake.
• Environmental Importance 
  • Ramsar Site: Declared a wetland of international importance under the Ramsar Convention in 1990.
  • Water Sources: Receives water from six rivers: Samaod, Khari, Mantha, Khandela, Medtha, and Roopangarh.
  • Vegetation: Features xerophytic vegetation, which is adapted to dry conditions.

Central Avian Research Institute (CARI)

• Location: Based in Izzatnagar, near Bareilly, Uttar Pradesh.
• Establishment: Founded in 1979 under the Indian Council of Agricultural Research (ICAR).
• Functions
  • Conducts research in poultry science, focusing on areas like avian genetics, breeding, nutrition, feed technology, physiology, and reproduction.
  • Aims to enhance the Indian poultry industry through scientific advancements.

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The Global Energy Efficiency Alliance was launched by the UAE at the COP29 in Azerbaijan.

• The Alliance will follow up on the lead taken up by the ‘UAE Consensus’ from COP28 aimed at reducing carbon emissions and conserving natural resources.

About Global Energy Efficiency Alliance

• Objective: The Alliance aims to double annual global energy efficiency rates by 2030 and reduce carbon emissions.
• Vision: The UAE will play a leading role in this alliance by sharing its expertise in energy efficiency, knowledge transfer, and building effective partnership models with the private sector. 
• Significance: 
• • Promote knowledge sharing, build capacity, and standardise policies that encourage investments in energy efficiency projects
  • Collective Participation among nations, multilateral organisations, and private sector players to implement policies, technologies, and investments aligning with global sustainability goals.
• Focus Country: African countries will be specially focused with plans to share financing models and technological solutions critical for its sustainable development.

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About The UAE Consensus

• It is a comprehensive document that calls for a transition away from fossil fuels in energy systems, in a just, orderly and equitable manner to achieve net zero by 2050. 
• Action Plan: It encourages Parties to submit economy-wide Nationally Determined Contributions (NDCs) and sets specific targets, including tripling renewables and doubling energy efficiency by 2030. 
• Commitments:
• • Reducing Non CO2 Emissions: The UAE Consensus for the first time acknowledges methane as a  greenhouse gas that needs to be controlled by 2030. 
  • To address Climate Change, biodiversity loss, and land degradation simultaneously to achieve the Paris Agreement’s temperature goals. 
  • Renewed Focus on Climate Finance: The agreement also paves the way for a new architecture for climate finance and building momentum toward a sustainable future
  • Gender-Responsive Climate Action: The Consensus includes a Global Call to action to drive progress on gender-responsive climate and environment commitments. 
  • Indigenous People Participation: It includes the Podong Indigenous Peoples Initiative, which will provide funding directly to Indigenous Peoples. 
  • Encouraging Private Sector Action: The UAE Consensus includes the Net Zero Mobilization Charter, which encourages the private sector to make and update net zero emissions targets.

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A study published in Scientific Reports in February 2024 estimated that 40% of bumblebee species in the Indian Himalaya could lose more than 90% of their habitat by 2050.

Reason for Declining Species of Bees 

• It all happened due to the introduction of western honey bee colonies after which some disease completely decimated the indigenous pollinator populations.

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About Pollination

• It is a process in which pollen grains from male part of a flower (Anther)  are transferred  to the female part (stigma). 
• Objective: The objective of pollination is the production of seeds which carry genetic material for creation of new plants. 
• Pollination Vectors: Wind, Water, Birds, Insects (bees, butterflies, etc.), Bats, and Other animals that visit flowers. 
• Pollinator
• • These are the animals or insects that help in  moving pollen. 
  • It occurs when pollinators 
    • Collect pollen for its nutritional value (protein).
    • Sip nectar from the flower.

About Insect Pollinators 

• These are insects that assist in the transfer of pollen from one flower to another,
• It  facilitates fertilization and seed production in plants. 
• They play a crucial role in maintaining biodiversity and supporting agriculture.

Types of Insect Pollinators

• Bees:
  • Honey Bees (Apis mellifera): Widely managed for honey production and crop pollination.
  • Wild Bees: Includes bumblebees and solitary bees, often more efficient pollinators than managed honey bees.
• Wasps: Contribute to pollination, though less efficient than bees.
• Beetles: Known as “mess and soil” pollinators, they help in pollinating some flowering plants.
• Flies: Particularly hoverflies, which mimic bees and are significant pollinators for various crops.
• Moths and Butterflies: Pollinate flowers while feeding on nectar, often at night (moths) or during the day (butterflies).

Importance of Insect Pollinators 

• Role of Insect Pollinators in Agriculture
• • Over 75% of food crops, fruits, and flowering plants rely on pollinators like bees, wasps, butterflies, and beetles for successful yields.
  • These pollinators are essential for global agricultural productivity and nutritional security.

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Threats to Pollinator Populations

• Pesticides and Pollution: Directly harm pollinators and their habitats.
• Climate Change: Disrupts ecosystems and reduces available resources.
• Infectious Diseases: Emerging as a new threat, worsened by habitat loss and reduced biodiversity.
• Economic Implications of Pollinator Decline
  • A decline in pollinators could impact the agricultural economy globally, affecting food supply and livelihoods.

Impact of Pathogen Transmission on Pollinators

• Pathogen Spillover and Spillback
  • Managed honey bees often carry pathogens like deformed wing virus and black queen virus.
    • These pathogens are transmitted to wild pollinators when they share habitats or floral resources, a process called spillover.
      • Pathogens may also mutate in wild pollinators and reinfect honey bees in more harmful forms (spillback).
• Findings from Swiss Research
  • A study published in Nature Ecology and Evolution found:
    • Pathogen loads in wild pollinators sharing habitats with managed honey bees were 10 times higher.
    • Diverse habitats with abundant floral resources reduced pathogen transmission risks.

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Sanjay Murthy, a 1989 batch IAS officer, has been appointed as the new Comptroller and Auditor General of India (CAG) by President Droupadi Murmu succeeding Girish Chandra Murmu.

About the Comptroller and Auditor General of India (CAG)

• The Comptroller and Auditor General (CAG) of India is the apex authority responsible for auditing the accounts of the Central and State Governments.
• It is a constitutional authority established under Article 148 of the Indian Constitution. 
• CAG is  often referred to as the “guardian of public finance,” the CAG ensures accountability and transparency by auditing government expenditures and revenues.
• Dr. B.R. Ambedkar recognized the significance of the CAG as a watchdog of public funds.
  • He emphasized the need for an independent auditor to ensure transparency and accountability in government spending
• Origin of CAG in India: Its roots date back to 1860, when the Accountant General to the Government of India was re-designated as the Auditor General. 

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Constitutional Provisions for the Comptroller and Auditor General of India (CAG)

• Article 148: Deals with the appointment, removal, and service conditions of the CAG.
• Article 149: Specifies duties and powers related to auditing government finances.
• Article 150: Advises the President on the format for government accounts.
• Article 151: Lays down procedures for submitting audit reports to the President or Governor.

Legal Provisions for the CAG (As per the CAG (Duties, Powers, and Conditions of Service) Act, 1971)

• Tenure: Holds office for six years or until 65 years of age, whichever is earlier.
• Resignation: May resign by submitting a letter to the President of India.
• Removal: Can only be removed by the President, following the same procedure as for a Supreme Court judge (impeachment).
• Conditions of Service: Salary, allowances, and service conditions are determined by Parliament.
  • These cannot be altered to the CAG’s disadvantage after appointment.
• Administrative Expenses: Charged to the Consolidated Fund of India, ensuring independence.

Powers and Functions of CAG

• Audit of Government Accounts: Includes the Consolidated Fund, Contingency Fund, and Public Account at both central and state levels.
• Audit of Revenue and Expenditure: Ensures compliance with rules and proper allocation of funds.
• Audit of Public Entities: Includes government corporations and bodies substantially financed by public funds.
• Advisory Role: Advises on the format of accounts and assists the Finance Commission.
• Submission of Reports: Submits audit reports to Parliament or State Legislatures, highlighting irregularities.
• International Role: Serves as an external auditor for international organizations like WHO and FAO.

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Types of CAG Audit Reports

• Compliance Audits: Verify adherence to laws, rules, and regulations.
  • Focus on procedural correctness and lawful expenditure.
• Performance Audits: Assess the efficiency, effectiveness, and economy of government programs.
  • Highlight gaps between objectives and outcomes.
• Financial Audits: Examine the accuracy and reliability of financial statements.
  • Ensure proper disclosure of public funds.
• Presentation of Reports: Reports are submitted to the President (for central accounts) or Governor (for state accounts).
  • These are tabled in Parliament or State Legislatures and examined by the Public Accounts Committee (PAC) for action and recommendations.

Comparison of CAG of India and CAG of the UK

Limitations of the CAG

• Lack of Enforcement Powers: The CAG can only report irregularities; it cannot enforce corrective action.
• Dependence on Executive: Recommendations rely on legislative and executive actions for implementation.
• Resource Constraints: Shortage of skilled personnel affects the quality and scope of audits.
• Risk of Policy Paralysis: Overzealous audits can sometimes lead to excessive caution in policymaking.

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Way Forward

• Independence: The UK’s National Audit Office (NAO) operates with greater financial and operational autonomy.
• Performance Audits: Focuses not just on financial propriety but also on the value-for-money audits.
• Capacity Building: Strengthening technical skills and resources to enhance audit capabilities.
• Collaboration with Legislature: Proactive engagement with parliamentary committees for more effective implementation of audit findings.

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Rajasthan Rajya Vidyut Utpadan Nigam Limited (RRVUNL)  has once again questioned the legitimacy of a report by the Chhattisgarh State Scheduled Tribes Commission (CSSTC), which found irregularities in environmental clearances for the Parsa coal mine in the Surguja region of Chhattisgarh.

Key Highlights of the Report

• Alleged Irregularities in Environmental Clearances: The CSSTC found irregularities in obtaining environmental clearances for the Parsa coal mine project.
• Forgery Claims: The Commission alleged that forged documents were used, particularly concerning the consent of the gram sabha (village council).
• Recommendations: The CSSTC recommended the cancellation of forest clearances for the project, citing biodiversity concerns in the Surguja region.

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About Coal and types of Coal

• Coal is a readily combustible, black or brownish-black sedimentary rock predominantly made of carbon.
• This is a solid fossil fuel formed over millions of years from the remains of plants. 
• As these plants decompose under high pressure and heat, they transform into various types of coal, ranging from low-grade lignite to high-grade anthracite.
• Types of coal in India:

Distribution of Coal in India

• Gondwana Coal Fields (250 million years old): It accounts for 98% of India’s coal reserves and 99% of its production. The coal of the region is of superior quality, high ash content, including metallurgical grade coal.
  • It is Found in following locations:
    • Damodar Valley (Jharkhand, West Bengal)
    • Mahanadi Valley (Chhattisgarh, Odisha)
    • Godavari Valley (Maharashtra)
    • Narmada Valley
• Tertiary Coal Fields (15–60 million years old): Carbon content is low, rich in moisture and sulfur.
  • It is found in Following Locations
    • Extra-peninsular regions (Assam, Meghalaya, Nagaland, Arunachal Pradesh, J&K)
    • Himalayan foothills (Darjeeling, West Bengal)
    • Rajasthan, Uttar Pradesh, Kerala

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Role of Coal in India’s Energy Sector

• Dominant Fuel Source: Coal is the primary fuel source for India’s power generation, accounting for a substantial portion of the country’s energy mix. It  is used in more than 70% of the total power generation.
  • Coal-based power generation in India has played a significant role in meeting the country’s energy demands. 
  • India is currently experiencing a substantial increase in power demand, driven by a combination of factors like industrial growth, technological advancements, population growth, economic development etc.
• Industrial Backbone: Coal is essential for various industries, including steel, cement, and fertilizers.
• Economic Growth: Coal-based industries contribute significantly to India’s economic growth and employment.
• Challenges and Transition: India is gradually transitioning towards cleaner energy sources to reduce its reliance on coal. However, coal remains a vital part of the country’s energy landscape.

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India marked a significant achievement by launching GSAT-20 aboard SpaceX’s Falcon-9 rocket, marking the first partnership between NewSpace India Limited (NSIL), the commercial arm of ISRO, and SpaceX for satellite deployment.

About GSAT-20

• GSAT-20 is a Ka-band satellite designed to provide high-speed broadband internet connectivity, digital video transmission,  audio transmission and  in-flight connectivity across India.
• Mission Life: 14 years
• Ka-Band: Operates in radio frequencies ranging from 27 to 40 GHz, enabling high-speed data transfers with wide coverage via focused spot beams.
• Technical Features of GSAT-20:
  • Equipped with 32 spot beams.
  • High throughput capacity of 48 Gbps.
  • Covers all of India, with a special focus on the Northeastern region, Andaman and Nicobar, and Laksdweep.
• Launch Context: ISRO opted for SpaceX’s Falcon-9 due to the limitations of India’s indigenous heavy-lift rocket, the Launch Vehicle Mark-3 (LVM-3), in carrying such a heavy satellite (4,700 kg).
  • Part of India’s space sector reforms (June 2020), allowing NSIL to build, launch, and operate satellites to meet user demands.
• Ownership and Operation: The satellite will be owned and operated by NSIL, ensuring it aligns with India’s commercial and strategic space objectives.

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About SpaceX Falcon 9 Launch

• Record-Breaking Booster Flight: The Falcon 9 first-stage booster achieved its 19th successful flight.
• Diverse Mission History: The booster previously supported missions like SES-22, ispace’s HAKUTO-R, CRS-27, Amazonas-6, and multiple Starlink missions.
• Successful Landing: The booster landed safely on the “Just Read the Instructions” droneship.
• Indian Space Collaboration: This launch signifies India’s growing involvement in high-throughput satellite communications and international space partnerships.

About New Space India Ltd. (NSIL)

• Incorporation: Established in March 2019 as a wholly owned Government Company under the administrative control of the Department of Space under PMO.
• Responsibilities: Promotion and commercial exploitation of products and services stemming from India’s space program.
• Major Business Areas:
• • Production of Launch Vehicles: PSLVs and SSLVs through industry partnerships.
  • Space-Based Services: Marketing and provision of satellite communication and remote sensing services.
  • Satellite Development: Building satellites for domestic and international clients.

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Recently Finance Minister Nirmala Sitharaman addressed critical issues affecting the banking sector, and stressed the need for banks to actively utilize the Bad Bank  to resolve distressed assets.

About Bad Bank

• A Bad Bank is a specialized Asset Reconstruction Company (ARC) that purchases Non-Performing Assets (NPAs) from commercial banks and restructures them.
• It is not involved in lending or deposit-taking, focusing solely on cleaning up banks’ balance sheets.
• Typically, it buys bad loans at a value below their book value, with subsequent recovery efforts aimed at maximizing returns.

Advantages of Bad Banks

• Centralised Management of NPAs: Provides a streamlined process for handling distressed assets across multiple banks.
• Capital Relief for Banks: By transferring NPAs, banks can free up capital held as provisions against bad loans.
  • This facilitates increased lending to creditworthy borrowers, fostering economic growth.
• Stabilization of the Financial System: Helps restore banks’ financial health, boosting confidence in the banking system.

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National Asset Reconstruction Company Limited (NARCL)

• Establishment: Proposed in the Economic Survey 2016; officially launched in 2021 as India’s first bad bank.
• Objective: Cleansing the financial system of distressed loans and stabilizing banks to foster a healthier economic environment.
• Key Roles of NARCL
  • Purchase bad loans from commercial banks.
  • Manage and recover value from these distressed assets.
• Payment Mechanism: 15% of the loan value is paid in cash and the remaining 85% is paid through government-backed security receipts.
• Ownership Structure: 51% stake held by state-owned banks and 49% stake held by private banks.
• NARCL along with the Government of India co-created IDRCL for resolving issues using bad banks.

India Debt Resolution Company Ltd. (IDRCL)

• IDRCL is entrusted with the responsibility of unlocking the value embedded in the large corporate distress assets (NPAs) of the Indian banking and financial system.
• IDRCL is owned by 14 of India’s largest private (51%) and public  scheduled commercial banks(49%).
• It collaborates with NARCL to sell stressed assets in the market. It primarily focuses on resolution and value recovery from bad loans.
  • NARCL: Primarily focuses on acquiring bad loans from banks.
  • IDRCL: Works on resolving and selling the distressed assets acquired by NARCL.
  • This dual-entity approach ensures efficient handling and resolution of stressed assets, enabling banks to focus on their core business of deposit mobilization and lending.

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PM Modi is attending the 19th  G20 Summit scheduled for November 18 and 19, 2024, in Rio de Janeiro,Brazil.

• India is attending as a member of the G20 Troika, which includes India, Brazil, and South Africa. 

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About G20

• Establishment: The G20 was founded in 1999 following the financial crisis of 1997-98 that impacted the Asian Tigers (East and Southeast Asian countries).
  • Initially, it served as a forum for Finance Ministers and Central Bank Governors from major industrialized and developing economies.
• Elevation to Leader’s Level: In the aftermath of the 2008 global financial crisis, the G20 was upgraded to include Heads of State or Government.
  • By 2009, it was designated as the “premier forum for international economic cooperation.“
• Membership: The G20 includes 19 countries and the European Union, recently joined by the African Union. 
  • Its members are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkiye, the United Kingdom, and the United States.
• Structure of G20: 
  • Sherpa Track: Focuses on socio-economic issues like climate, health, agriculture, digital economy, and education. Sherpas coordinate negotiations and set the agenda for the summit.
  • Finance Track: Led by Finance Ministers and Central Bank Governors, it addresses fiscal and monetary policy, typically meeting alongside World Bank and IMF conferences.
• Non-Binding Nature: The G20 operates as a consultative forum, meaning its decisions are not legally binding, and member countries are not obligated to implement them.

Significance of G20

• Focus on Global Issues: Through its various tracks, the G20 addresses critical global challenges, fostering international cooperation and economic stability.
• Economic Powerhouse: G20 Represents 85% of global GDP and drives 75% of global trade.
• Global Governance: Premier forum for international economic cooperation to global economic policies and regulations.
• Diverse Representation: Includes both developed and developing economies providing a platform for diverse perspectives and solutions.

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PPP plus PPP’ Model

Context: On World Diabetes Day, the Union Minister for Science and Technology introduced the ‘PPP plus PPP’ model.

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• World Diabetes Day is held on 14th November. 
• Theme (2024): “Breaking Barriers, Bridging Gaps”, 

About Diabetes

• Diabetes is a metabolic disease.
• It causes the body to stop producing insulin efficiently, causing a rise in the blood sugar level. 
• Challenges  faced by diabetes patients in the healthcare 
  • Accessibility: Many lack access to regular treatment.
  • Awareness: Nearly half of diagnosed patients are unaware of their condition.
  • Adherence: Financial and informational challenges limit consistent care.

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About ‘PPP plus PPP’ model

• This model is a strategy to address diabetes. 
• It involves a two-tiered collaboration .
  • In this  model, India’s public and private sectors unite internally to strengthen healthcare infrastructure while simultaneously engaging with international counterparts
    • Domestic Partnership: Public and private sectors within India work together to strengthen healthcare infrastructure.
    • International Partnership: India collaborates with international partners to accelerate innovation and improve healthcare accessibility.
• Objective: This layered partnership model aims to:
  • Improve healthcare accessibility.
  • Foster innovation.
  • Provide scalable solutions for diabetes care.

Mitigation Work Programme (MWP)

Context: India expressed dissatisfaction on unwillingness by Developed countries to engage in the Climate Finance and Mitigation Work Programme at CoP29 in Baku, Azerbaijan.

About Mitigation Work Programme (MWP)

• The Mitigation Work Programme (MWP) is a process established by the United Nations Framework Convention on Climate Change (UNFCCC).
• Aim: To help countries scale up their mitigation ambition and implementation in order to achieve the 1.5°C goal of the Paris Agreement

India’s Position on the Mitigation Work Programme (MWP)

• Specific Mandate of MWP: India emphasised that the MWP was created with a clear mandate to facilitate focused exchanges of views, information, and ideas.
• Non-Prescriptive and Non-Punitive: The outcomes of the MWP will be non-prescriptive and non-punitive, ensuring that no country is forced to take specific actions or meet new targets.
• Respect for National Sovereignty: India stressed that the MWP will respect national sovereignty and circumstances, and will account for each country’s nationally determined contributions (NDCs).
• No New Targets or Goals: India highlighted that the MWP will not impose new targets or goals, but will focus on collaboration and sharing of solutions to mitigate climate change.

About COP29

• Venue: Baku, Azerbaijan
• Conference Dates: 11th November 2024 to 22nd November 2024
• Focus of COP29: Dubbed the “Finance COP,” the summit focuses on establishing a new global climate finance target to support vulnerable nations impacted by climate change.
  • Countries of the Global South, including India, are advocating for enhanced access to financial and technological resources to meet climate goals and safeguard frontline communities.

About COP and UNFCCC

• COP (Conference of the Parties): The primary governing body of the UN Framework Convention on Climate Change (UNFCCC).
• UNFCCC: An international treaty created in 1992 during the Earth Summit in Rio de Janeiro to guide global climate negotiations, aiming to stabilise greenhouse gas concentrations at safe levels to avoid severe human-induced climate disruptions.
• Membership: The UNFCCC includes 198 parties, comprising 197 countries and the European Union, reflecting near-universal global commitment to climate action.

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About Paris Agreement on Climate Change

• Adoption: The Paris Agreement is a legally binding global accord adopted in 2015 at UNFCCC COP21.
• Objective: Its goal is to combat climate change and limit global warming to well below 2°C above pre-industrial levels, aiming for 1.5°C.
• Replacement: It replaced the Kyoto Protocol.

About Global Stocktake under the Paris Agreement

• Establishment: The Global Stocktake is a review mechanism set up under the Paris Agreement in 2015.
• Frequency: It occurs every five years.
• First Stocktake: The inaugural Global Stocktake concluded at COP28 in 2023.

Futures Trading in Agricultural Products

Context: A recent study has found that the suspension of futures derivative trading of agricultural commodities in 2021 has disrupted the agricultural pricing system and worsened inflation.

About the Study

• Background: Indian Government has suspended futures derivatives trading for seven agricultural commodities ie. gram, wheat, paddy, moong, crude palm oil, mustard, and soybean in 2021 to curb the rising prices

About Commodity Futures Contract

• It is an agreement to buy or sell a predetermined amount of a commodity at a specific price on a specific date in the future.
  • The contract, unlike the Option contract, obliges the buyer to purchase some underlying asset (or the seller to sell that asset) at a predetermined future price and date.
• Commodity futures can be used to hedge or protect an investment position or to bet on the directional move of the underlying asset.
• Regulating Agency: SEBI (Securities Exchange Board of India) regulates Commodity trading in India. It has set up a separate category for commodity futures trading under the F&O (Futures & Options) segment.
  • Previously, Commodity trade was regulated by The Forward Markets Commission (FMC), established under the Forward Contracts (Regulation) Act, 1952.
  • FMC was merged with SEBI in 2015 to make the regulation of commodities market more robust.
• Significance: The hedging and price discovery functions of future markets promote more efficient production, storage, marketing and agro-processing operations with overall improvement in  agricultural marketing performance.

About Derivatives

• Types: Derivatives are financial instruments whose value is derived from other underlying assets. 
• There are mainly four types of derivative contracts
  • Futures: They are standardized contract which are traded on the exchange to buy or sell underlying instrument at certain date in future
    • It does not carry any credit risk as the clearing house acts as counter-party to both parties in the contract
  • Forwards: It is an agreement between two parties and it is traded over-the-counter (OTC).
  • Options: An Option contract gives the right but not an obligation to buy/sell the underlying assets. It requires paying a  premium to the seller.
    • Options can be traded in both OTC market and exchange traded markets and are  divided into two types – call and put.
  • Swaps: It is between two parties to exchange cash flows in the future. Interest rate swaps and currency swaps are the most popular swap contracts.
    • India does not exercise the swap option in its market.

About Hedging

• It is a risk management technique whereby an asset is purchased with the intention of reducing the risk of loss from another asset. 
  • It focuses on minimizing and eliminating the risk of uncertainty and limiting losses occurring as a result of unforeseeable variations in the price of the investment
• Types: Hedging can be done by 4 types namely,
  • Forward Contract; Futures Contract; Money Market and Hedge Funds

Ayushman Vay Vandana

Context: Recently, Prime minister launched Ayushman Vaya Vandana health cards under the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB PM-JAY)

More on the news

• Over 10 lakh senior citizens aged 70 and above have enrolled in the newly launched Ayushman Vay Vandana scheme.
• Among the enrollees, women account for approximately 4 lakh registrations
• Since the scheme’s implementation, treatments worth over ₹9 crore have been authorized.
  • These benefits have helped more than 4,800 senior citizens, including over 1,400 women.

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About Ayushman Vay Vandana

• It is healthcare coverage for the senior citizens aged 70 years and  above.
• Scheme type: Centrally Sponsored Scheme
  • State contribution: 40% of the cost. 
• Launch Date: October 29, 2024
• Nodal ministry: The Ministry of Health and Family Welfare. 
• This scheme provides free healthcare benefits under the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY).
• Key Takeaways 
  • Elderly people aged 70 and above will get Rs 5 lakh annually which will be shared within the family. 
    • In case of two beneficiaries in the household, the cover will be split among them. 
  • Top-Up Cover for Elderly Beneficiaries
    • Elderly members (aged 70+) from families already covered under Ayushman Bharat will receive an additional ₹5 lakh top-up cover exclusively for them.
      • To access the top-up, these beneficiaries must re-register under the scheme.
  • Health coverage under Ayushman Vay Vandana Card 
    • The new scheme provides coverage for various health conditions, including:
      • Coronary angioplasty
      • Hip fractures and replacements
      • Gallbladder removal
      • Cataract surgery
      • Prostate resection
      • Stroke treatment
• About PM JAY 
  • PM JAY stands for Pradhan Mantri Jan Arogya Yojana 
  • It is recognised as the world’s largest health assurance scheme. 
  • It provides secondary and tertiary care hospitalization benefits.
  • Key Features
    • Coverage Amount: Offers health benefits of up to ₹5 lakh per family annually.
    • Target Population: Covers nearly 55 crore individuals, representing the bottom 40% of India’s population.
  • Beneficiary Identification :  Beneficiaries are identified based on the Socio-Economic Caste Census (SECC) 2011:
    • Rural Areas: Inclusion is based on deprivation criteria.
    • Urban Areas: Selection is determined by occupational categories.

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