Context:

• The Ministry of Housing and Urban Affairs (MoHUA) launched the ‘AAINA Dashboard for Cities’ portal.
• A pioneering initiative for Urban Local Bodies (ULBs) across India.

About AAINA Dashboard:

• It is a portal where Urban Local Bodies (ULBs) across the country can participate to voluntarily submit their key data on a regular basis, through a simple, easy-to-fill, data entry form on the portal.
• The primary objectives of the AAINA Dashboard are to help cities to 
• • See how they are faring vis-à-vis other cities, 
  • Inspire them by pointing to possibilities and areas of improvement and 
  • Provide opportunities to learn and engage with frontrunners.

Five Pillars of Assessment:

The Dashboard will evaluate ULBs based on indicators across five pillars:

• Political & Administrative Structure
• Finance
• Planning
• Citizen-Centric Governance
• Delivery of Basic Services

Data Submission Process:

• ULBs voluntarily submit key data regularly through an easy-to-fill data entry form on the portal.
• Data includes audited accounts and self-reported performance metrics.
• ULBs have the flexibility to update information as needed.
• Ministry, through Digital India Corporation, offers support to ULBs and states in the data submission process.

News Source: PIB

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Context:

• Recently, the Prime Minister paid tributes to Rani Lakshmibai on her birth anniversary (19th November).

About Rani Lakshmibai

• Birth and Early Life: Born as Manikarnika Tambe in 1828 in Varanasi.
• Marriage: In 1842, Lakshmibai got married to Gangadhar Rao Newalkar, the Maharaja of Jhansi, and got the name of Rani Lakshmibai

• • Adopted Anand Rao after the death of her son and husband, who was later renamed as Damodar.
  • Faced the application of the Doctrine of Lapse by the East India Company.

Doctrine of Lapse:

• Annexation Policy: Policy by Lord Dalhousie, Governor-General from 1848 to 1856.
• The policy Stated that states without legal male heirs would be annexed by the East India Company.
• Challenge to Succession:
• • Damodar Rao, adopted by Rani Lakshmibai, not accepted as the legal heir.
  • Britishers applied the Doctrine of Lapse to annex Jhansi.

Role of Rani Lakshmibai in the Revolt of 1857: 

• Rani Lakshmibai rebelled against the British in 1858 when commanding officer of the British forces, Sir Hugh Rose, demanded the surrender of Jhansi.
• She was determined to not give up on the Dominion of Jhansi and hence started assembling an army of rebellions, including women. 
• She was supported by Tantia Tope and Nana Sahib.
• After a fierce war, She escaped to Kalpi and was accompanied by other rebellions. She then departed to Gwalior and a fierce battle was fought between the British and Lakshmibai’s army.
• Martyrdom: She died while fighting on June 17, 1858.
• General Hugh Rose on her death said that “here lay the woman who was the only man among the rebels”.

News Source: PIB

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Context:

• GTRI suggests India should focus on becoming a middle-income country before aspiring to make the INR (rupee) a hard currency.

Suggestions for INR Development

• Wait for Middle-Income Status: The think tank recommends that India waits until its economy grows further and attains middle-income status before pursuing the goal of making the INR a hard currency.
• Strengthen Local Currency Settlements: Focus on making local currency settlements more robust to enhance economic stability.
• Enhance Currency Convertibility: Acknowledge the importance of making the rupee fully convertible on the capital account, a key trait of hard currencies.
  • India operates a partially convertible capital account, which entails that the INR can be swapped for foreign currencies and vice-versa for limited reasons.

What is Hard Currency?

• Hard currency refers to money that is issued by a nation that is seen as politically and economically stable. 
• Hard currencies are widely accepted around the world as a form of payment for goods and services and may be preferred over the domestic currency.
  • The problem of international liquidity is related to the non-availability of Dollar and other Hard Currency.
• Key Factors for Hard Currency Status:
• • Economic stability, low inflation, consistent growth, and a balanced trade environment are pivotal factors.
  • Strong fiscal and monetary policies, political stability, and effective national debt management are crucial for aspiring reserve currency status.
• Some of the most recognised hard currencies and their approximate global share:
  • US Dollar (60 percent), Euro (20 percent), Japanese Yen (5-6 percent), British Pound Sterling (4-5per cent), Swiss Franc (1 percent), Canadian Dollar (2-3 percent) and Australian Dollar (2-3 percent).

News Source: Financial Express

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Context:

• Recently, the Reserve Bank of India (RBI) acquired nine tonnes of gold in the September quarter and the Global central banks collectively purchased 337 tonnes during the same period.

Gold Reserves In India and India’s Gold Reserves Ranking

• Gold reserves in India reached 806.7 tonnes as of September end.
• The country holds the 10th position in global rankings, according to the World Gold Council (WGC).

Accumulation Trend:

• RBI’s gold purchases in 2023 totalled 19.3 tonnes.
• The central bank has consistently added to its gold reserves since 2017, accumulating 248.9 tonnes by the current year.

Gold’s Share in Forex Reserves:

• As of September 29, India’s total forex reserves stood at $586.9 billion.
• Gold’s value in these reserves was $43.7 billion, representing 7.44% of the total reserves.

About World Gold Council (WGC):

• The World Gold Council (WGC) is an international organization formed in 1987 by some of the world’s most forward-thinking mining companies.
• Member: The World Gold Council’s 33 Members are some of the world’s most forward-thinking gold mining companies.
• Headquarter: London (UK)

News Source: Livemint

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Context:

• Recently, the Union Minister for Education and Skill Development & Entrepreneurship launched 37 PM SHRI Kendriya Vidyalayas (KV) and 26 PM SHRI Jawahar Navodaya Vidyalayas (NVS) in Odisha.

About PM SHRI Schools (PM Schools for Rising India) scheme:

• It was approved by the Union Cabinet in 2022. 

• This centrally sponsored initiative aims to uplift over 14,500 schools nationwide by enhancing existing institutions managed by Central Government/State/UT Government/local bodies.
• PM SHRI schools will showcase the implementation of the National Education Policy 2020 and emerge as exemplar schools over a period of time, and also offer leadership to other schools in the neighborhood.
• Financial Outlay: The scheme’s total project cost is Rs. 27,360 crore, with a central share of Rs. 18,128 crore over five years (2022-23 to 2026-27).

Features of PM SHRI Schools:

• Equitable Education:
  • Focus on diverse backgrounds, multilingual needs, and varied academic abilities.
  • Act as active participants in their learning process as per the vision of NEP 2020.
• Green School Initiatives:
  • Incorporate environment-friendly aspects like solar panels, LED lights, nutrition gardens, waste management, and water conservation.
  • Create awareness for adopting a sustainable lifestyle.
• Innovative Pedagogy:
  • Experiential, holistic, and learner-centered teaching methods.
  • Encourage play/toy-based and inquiry-driven learning, fostering 21st-century skills.
• Assessment and Quality Assurance:
  • Competency-based assessment at all levels.
  • Regular quality evaluations using the School Quality Assessment Framework (SQAF).
    • School Quality Assessment and Assurance Framework (SQAAF) is a set of standards and best practices as paradigms for attaining individual and institutional excellence. 

Implementation Strategy:

• Implemented through existing administrative structures for Samagra Shiksha, KVS & NVS.

Selection Methodology in PM SHRI Schools:

• Challenge Mode: Schools compete for support to become exemplar schools.
• Quarterly application process for schools to self-apply on the online portal.
• Maximum two schools (one Elementary & one Secondary/Senior Secondary) would be selected per block/ULB with upper limit of number of total schools across India.
• Geo-tagging of schools for the selection and monitoring of PM SHRI schools will be done. 
• The services of Bhaskaracharya National Institute for Space Applications and Geo-informatics (BISAG-N) will be taken for geo-tagging and other related tasks. 

News Source: PIB

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Context:

• Recently, the Union Finance and Corporate Affairs Minister said that women entrepreneurs are accorded first priority under the Centre’s flagship Pradhan Mantri Mudra Yojana scheme.

Pradhan Mantri Mudra Yojana Scheme: Key Highlights

• The Finance Minister highlighted that the Pradhan Mantri Mudra Yojana aims to provide loans through banks particularly to empower women entrepreneurs.
• The scheme allows women who are running small businesses or interested in starting a business, can approach the bank and start their venture by receiving the loans from PM Mudra Yojana scheme. 
• Through this scheme, if 100 people were beneficiaries, 60 of them would comprise women. Women were accorded top priority under the PM Mudra scheme,” she pointed out.

About Pradhan Mantri MUDRA Yojana (PMMY):

• MUDRA, stands for Micro Units Development & Refinance Agency Ltd., is a financial institution set up by the Centre.
  • MUDRA was initially formed as a wholly owned subsidiary of the Small Industries Development Bank of India (SIDBI) with 100% capital being contributed by it. 
• Launch Year: 2015
• Objective: To provide loans up to 10 lakh to non-corporate, non-farm small and micro enterprises through Banks, Non-Banking Financial Companies (NBFCs), and Micro Finance Institutions (MFIs).
• MUDRA does not lend directly to micro-entrepreneurs/individuals.
• Loans under this scheme are collateral-free loans.
• Ministry: Ministry of Finance 

News Source: Financial Express

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Context:

• As Onattukara sesame has received a geographical indication (GI) tag, stakeholders are upbeat that the recognition will boost its popularity and market value.

About  Onattukara sesame

• Cultivation: Onattukara sesame is currently grown on less than 600 hectares spread across 43 local bodies in three districts of Alappuzha, Kollam, and Pathanamthitta, Kerala.
• Nutritional Benefits: Besides vitamin E and antioxidants, it also contains oleic acid, linoleic acid, palmitoleic acid, etc, which help maintain good health.

News Source: The Hindu

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Context:

• The ongoing third session of the Intergovernmental Negotiating Committee (INC-3) at the United Nations Environment Programme headquarters in Nairobi, Kenya, has focused on the 3Rs of waste management (Reduce, Reuse, Recycle). 

Key Highlights of Intergovernmental Negotiating Committee (INC- 3) Meeting:

• On the sidelines of Day 3 proceedings of the INC-3, a Break Free From Plastic (BFFP) representative carried out a panel discussion focused on prioritizing reuse solutions in the global plastics treaty. 
  • The discussion addressed by expert panelists from Europe, Indonesia, Spain, and other countries came up with innovative solutions on the topic key to addressing the plastic crisis.
• One of the key considerations at INC-3 will be the launch of negotiations on the ‘Zero draft text of the international legally binding instrument on plastic pollution, including in the marine environment.

About Intergovernmental Negotiating Committee (INC-3)

• Genesis: The resolution (5/14) requested the UN Environment Programme (UNEP) to convene an Intergovernmental Negotiating Committee (INC) to develop “the instrument,” which is to be based on a comprehensive approach that addresses the full life cycle of plastic, including its production, design, and disposal.
• The Intergovernmental Negotiating Committee (INC) came into existence in  2022, at the 5th session of the United Nations Environment Assembly (UNEA-5.2).

News Source: DTE

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Context:

• Recently, Air Chief Marshal V.R. Chaudhari stressed the need for investing in new and disruptive technologies in the Synergia Conclave 2023.
• Synergia Conclave serves as a platform to draw together the most insightful ideas and solutions from around the globe

More on News:

• Application of Disruptive technology:  Air Chief Marshal said that conventional knowledge would lead to incremental change but the innovative use of converging technology would lead to exponential change.

What Is Disruptive Technology?

• Introduction: Clayton Christensen introduced the idea of disruptive technologies in a 1995 Harvard Business Review article. Christensen later expanded on the topic in The Innovator’s Dilemma, published in 1997
• Disruptive technology is an innovation that significantly alters the way that consumers, industries, or businesses operate.
  • Some examples of disruptive technologies include online shopping, and ride-sharing apps, Blockchain.
• A disruptive technology has the potential to replace the existing systems or habits through its attributes that are measurable and superior.

How is disruptive technology different from sustaining technology?

• Most technology is considered sustaining rather than disruptive. Sustaining technology evolves slowly and steadily over time. 
• Established businesses typically work with sustaining technologies that allow them to refine their production methods and corner a known market. 
• However, over time a disruptive technology can become a sustaining technology as it becomes firmly established.

News Source: The Hindu

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Context: 

• Recently, an India-bound cargo ship was seized by the Houthis in the Red Sea.

About the Red Sea:

• Geography: The Red Sea is a semi-enclosed, inlet (or extension) of the Indian Ocean between the continents of Africa from Asia. 

• • It is the world’s northernmost tropical sea. It is a Global 200 Ecoregion, and underlying it is the Red Sea Rift, which makes it a part of the Great Rift Valley.
• Connectivity and Waterways: It is connected to the Arabian Sea and the Indian Ocean to the south through the Gulf of Aden and the narrow strait of Bab el Mandeb. 
  • The northern portion of the Red Sea is bifurcated by the Sinai Peninsula into the Gulf of Aqaba and the Gulf of Suez, where it is connected to the Mediterranean Sea via the famous Suez Canal.
• Bordering Countries: Yemen, Saudi Arabia, Egypt, Sudan, Eritrea, and Djibouti.
• Distinct Features: Due to seasonal blooms of a red-colored cyanobacteria alga -Trichodesmium erythraeum  the sea is a reddish-brown color. 
  • Islands: Farasan Islands,  Dahlak Archipelago 

Significance:

• The Red Sea, stretching from Egypt’s Suez Canal to the narrow Bab el-Mandeb Strait separating the Arabian Peninsula from Africa, remains a key trade route for global shipping and energy supplies.

News Source: The Indian Express

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Context:

• The World Antimicrobial Awareness Week (WAAW) is to be observed every year from November 18 to 24, 2023.

World Antimicrobial Awareness Week 2023

• Cause for rising AMR: AMR stands as a critical global health issue, worsened by the excessive use and misuse of antibiotics, particularly during the COVID-19 pandemic. 
• Consequences of rising AMR: If AMR is not addressed urgently, we might enter a post-antibiotic era where even minor infections could become deadly which could once be treated with antibiotics.
• The World Antimicrobial Awareness Week (WAAW) theme for 2023 is ‘Preventing Antimicrobial Resistance Together’.

What is Antimicrobial Resistance (AMR)?

• It occurs when bacteria, viruses, fungi, and parasites change over time and no longer respond to medicines making infections harder to treat and increasing the risk of disease spread.
  • Drug resistance in bacteria
    • For example, the rate of resistance to ciprofloxacin, an antibiotic commonly used to treat urinary tract infections, varied from 8.4% to 92.9% for Escherichia coli and from 4.1% to 79.4% for Klebsiella pneumoniae  
  • Drug resistance in the virus
    • For example, All antiretroviral (ARV) drugs, including newer classes, are at risk of becoming partly or fully inactive because of the emergence of drug-resistant HIV (HIVDR). 
      • People receiving antiretroviral therapy can acquire HIVDR, and people can also be infected with HIV that is already drug-resistant. 
• As a result of drug resistance, antibiotics and other antimicrobial medicines become ineffective and infections become increasingly difficult or impossible to treat.

How to raise awareness about Antimicrobial Resistance?

• Public education on the dangers of self-medication and the importance of responsible antimicrobial use is vital in curbing this concerning trend and preserving the effectiveness of antibiotics for future generations. 
• Educating children on antimicrobial use instills responsible habits and attitudes early on, shaping the behavior of future patients and caregivers. 
  • The Delhi Society for the Prevention of Rational Use of Drugs (DSPRUD) organized mass campaigns for two consecutive years in Delhi Schools, supported by WHO, the Delhi Government, the National Centre for Disease Control, and a targeted initiative with ECHO India. 

Steps Taken by India to Prevent Antimicrobial Resistance:

• Delhi Declaration on AMR: An inter-ministerial consensus was signed at the launch of NAP-AMR, by the ministers of the ministries concerned pledging their whole-hearted support in AMR containment.
• Red Line awareness campaign on AMR: It urges people not to use medicines marked with a red vertical line, including antibiotics, without a doctor’s prescription.

News Source: DTE

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Context:

• The Indira Gandhi Prize for Peace, Disarmament, and Development 2022 was jointly awarded to the Indian Medical Association and the Trained Nurses Association of India as representatives of the COVID-19 warriors in the country.

Indira Gandhi Peace Prize Presented to COVID-19 Warriors

• The Jury, chaired by former Chief Justice of India T.S Thakur has outlined that this award was in recognition of the heroic endeavors of the COVID warriors during the global pandemic.
• In its announcement statement, the Indira Gandhi Memorial Trust added, Statistics are hard to come by and are not always reliable, but there is little doubt that the women and men of the medical fraternity soldiered on beyond the call of duty. 

About Indira Gandhi Peace Prize:

• The Indira Gandhi Peace Prize is an annual prestigious award. It has been named after former Prime Minister Smt. Indira Gandhi. 
• It has been conferred every year since 1986 by the Indira Gandhi Memorial Trust. It consists of a monetary award of `25 lakh along with a citation.

Notable Winners of Indira Gandhi Peace Prize:

• Pratham (NGO) 2021
• Sir David Attenborough 2019
• Center for Science and Environment 2018

News Source: The Hindu

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Context:

• According to a news article published in Financial Express, the Centre’s food subsidy outlay is likely to be pegged at Rs 2.3 trillion in the Budget Estimate (BE) for the next financial year.

Key Highlights on the Food Subsidy in India

• Rise in food subsidy: In the revised estimate (RE) for FY24, the food subsidy is estimated to rise by Rs 17,000 crore to Rs 2.14 trillion due to sharp increases in the minimum support price (MSP) for key crops.
  • The food subsidy BE for FY25 is likely to be around 7% higher than the FY24RE.
  • Revised Estimates: RE are mid-year reviews of possible expenditures, taking into account the trend of expenditure, New Services and New Instruments of Services, etc. 
  • Revised Estimates are not voted by the Parliament, and hence by itself do not provide any authority for expenditure
  • Budget Estimates: Amount of money allocated in the Budget to any ministry or scheme for the coming financial year.
• Impact on the fiscal deficit (FD): Despite the increase in food subsidy, the government’s goal of limiting the fiscal deficit to 5.9% of GDP will not be impacted given the robust performance of tax and non-tax revenues.
  • The difference between total revenue and total expenditure of the government is termed as fiscal deficit
• Increase in MSP: For key rabi and kharif crops, the MSP increases this year have been the highest since 2018-19 as a new policy of 50% profits over computed cost of production was adopted for the price setting.
  • The MSP of wheat has been raised by 7.05% to Rs 2,275/quintal for the 2024-25 marketing season (April-June), the sharpest increase since 2014-15. 
  • The MSP for paddy, the key kharif crop has been raised by 7% this year to Rs 2,183/quintal.
  •  MSP is the assured price announced by the central government at which food grains are procured from the farmers by central and state governments along with their agencies.
• Extension of PMGKAY: The scheme which was to expire in December 2023 was recently extended by the Prime Minister for another five years.

Also Read: Centre Approves Minimum Support Prices (MSPs) for Rabi Crops 2024-25

What is Food Subsidy?

• About:. The Department of Food and Public Distribution provides food subsidies to the Food Corporation of India (FCI) and states for procuring food grains from farmers at government notified prices and selling them at lower subsidised prices (known as Central Issue Prices), under the National Food Security Act (NFSA), 2013.

• • FCI was established by the government of India in 1965 for procurement, distribution, and storage of food grains. 
• Economic cost consists of the cost of procurement, storage, and distribution of food grains.
• Nodal Ministry: The  Department of Food and Public Distribution under the Ministry of Consumer Affairs, Food and Public Distribution.

What are the components of food subsidy?

• Subsidy to FCI: The government provides a subsidy to FCI for the procurement of food grain from the farmer at a notified price.
• Subsidy to state: The central government provides food subsidy to the state under decentralised procurement scheme.
  • Under this, the state may take the operation of procurement, distribution, and storage of food grain on behalf of the Food Corporation of India.
• Sugar subsidy: Under the Antyodaya Anna Yojana, sugar subsidy is given to the poor family by providing one kg of sugar per month at subsidised price.

What are the concerns associated with food subsidy in India?

• RIsing Economic Cost of the food Grains:  The increase in the MSPs of rice and wheat, high State-level levies, which account for almost 50 percent of the procurement incidentals for foodgrains, and the rising trend in distribution costs have contributed to the increase in the economic costs of foodgrains over the years
• Difference between economic cost and central issue price: The widening gap between economic cost and Central Issue Prices (CIPs) has led to an increase in expenditure on food subsidy.
  • While the economic cost for rice has increased from Rs 11 per kg in 2001-02 to Rs 43 per kg in 2021-22, and of wheat from Rs 9 per kg to Rs 30 per kg over the same period, their CIPs have not been revised.

• Faulty cropping pattern: The open-ended procurement of paddy and wheat in states such as  Punjab and Haryana increased both the area and production of these crops, displacing crops like pulses and oilseeds.
• Excessive stockholding: The monocropping of paddy and wheat resulted in excessive stockholding beyond the norm required for food security.
• • About 10 per cent of the procured foodgrains are routinely wasted in post-harvest handling and storage losses. 
  • As of May 2021, the actual food stock with the government was about 83 million tonnes, against the strategic requirement of only 50 million tonnes. 
• Impact on environment: The Economic Survey of 2019-20 noted that the increasing trend in MSPs gives a signal to farmers to opt for crops that have an assured procurement system. 
  • This shows that market prices do not offer remunerative options for farmers and MSPs act as maximum prices that farmers can realise. 
  • This puts pressure on the water table as these crops (especially paddy and sugarcane) are water-intensive.
• Sugarcane dues:  In years of surplus production, the sugar prices fall impacting the sale of sugar and the liquidity of mills.
• • As a result, mills are unable to pay farmers leading to delays in payments and accumulation of dues. 
  • Sugar mills are obligated to purchase sugarcane from all farmers within their specified area at a price fixed by the government.  Conversely, farmers are bound to sell to the respective mills.
  • As of January 31, 2021, payment of Rs 19,260 crore is pending with sugar mills as dues for 2019-20 and previous years.
  • Certain state governments fix their own State Advised Prices at levels higher than the FRP announced by the central government.  This causes further strain on the financial health of the sugar mills.

What challenges are associated with the delivery of food subsidy?

• Leakages in the Public Distribution System:  Leakages refer to food grains not reaching the intended beneficiaries.  
  • According to the 2011 data, leakages in the Public Distribution System were estimated to be 46.7%.
  • Leakages may be of three types: 
    • Pilferage or damage during transportation of foodgrains
    • Diversion to non-beneficiaries at fair price shops through the issue of ghost cards
    • Exclusion of people entitled to foodgrains but who are not on the beneficiary list.
• Exclusion errors: It refers to the percentage of poor households that are entitled to but do not have Public Distribution System cards.  
  • Exclusion errors had declined from 55% in 2004-05 to 41% in 2011-12.
• Inclusion errors: These occur when those who are ineligible get undue benefits.  Inclusion errors had increased from 29% in 2004-05 to 37% in 2011-12.
  • Under the National Food Security Act, of 2013, states are responsible for the identification of beneficiaries.  
  • In 2016, the Comptroller and Auditor General of India (CAG) found that this process had not been completed by the states, and 49% of the beneficiaries were yet to be identified by states.

Way Forward:

• Reforms in targeted Public Distribution System: There is a need for the diversification of the commodities under PDS.
  • For this, the government has to focus on sustainable production and economically feasible procurement and distribution of diversified foods.
  • For example, Haryana is providing financial incentives of ₹7,000/acre to farmers for shifting from paddy to pulses, oilseeds, and cotton. 
• Revisiting National Food Security Act norms and coverage: An official committee in January 2015 called for decreasing the quantum of coverage under the law, from the present 67% to around 40%.
• Voluntary “give up” of subsidies:  For all ration cardholders drawing food grains, a “give-up” option, as done in the case of cooking gas cylinders, can be made available. 
  • While States have the authority to establish criteria for identifying Priority Household (PHH) cardholders, the Centre can nudge them to reduce the number of beneficiaries.
• Slab system of prices: The existing arrangement of flat rates should be replaced with a slab system of prices. 
  • Barring the needy, other beneficiaries can be made to pay a little more for a higher quantum of food grains. 
  • The rates at which these beneficiaries have to be charged can be arrived at by the Centre and the States through consultations. 
  • These measures, if properly implemented, can have a positive impact on retail prices in the open market. 
• Direct Benefit Transfer (DBT): A better alternative to support prices is an in-cash subsidy, namely where the government directly transfers money to individual beneficiaries. 
  • This will increase the purchasing power of the poor and has an indirect bearing on production. 
  • Further, with recent advances in direct money transfer technologies, like JAM (Jan Dhan-Aadhaar-Mobile), the implementation challenges of DBT have eased with near-zero leakages and logistics costs, especially for paddy and wheat where production is not a problem.
• Rationalisation of sugarcane pricing Linkage of sugarcane prices to sugar prices: As recommended by a Task Force on Sugarcane and Sugar Industry (2020), sugarcane prices must be linked to sugar prices.
• • Increases in FRP should be kept moderate and the state announcing SAP should bear the additional costs associated with it.
  • The Task Force recommended a staggered payment mechanism for sugarcane so that the entire dues to the farmers are cleared within two months.  
  • The task force had recommended increasing the minimum selling price of sugar to Rs 33 per kg with it being reviewed six months after notification.
  • This would aid sugar mills to cover their cost of production and maintenance costs. 
  • The CACP (2018) recommended that the FRP must be implemented in all states and the announcement of SAP by states should be stopped immediately.  
  • In case state governments decide to continue with SAP, the difference between SAP and FRP should be paid by the state governments directly to farmers.

Also Read: World Food India 2023: Nurturing Agriculture and Food Processing

Conclusion:

Addressing rising costs, crop patterns, and delivery issues is vital for the long-term success of India’s food subsidy programme.

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Context:

• This article is based on the news “India’s Trade Trajectory: FTAs and Beyond” Which was published in the Live Mint. India has been refining its global trade strategy and emphasizing a fresh outlook on Free Trade Agreements (FTAs). It is currently negotiating a potentially landmark FTA with the UK.

Key Highlights on India’s Evolving Global Trade Relations

• India is on a journey to strengthen its trade relations with several nations with FTAs that promise mutual benefits. 
• Agreements with ASEAN, Japan, and South Korea have significantly influenced India’s trade dynamics and have enriched its understanding of complex trade agreements.
  • Experience: India negotiated key agreements in the recent past viz. UAE and Australia, reflecting the country’s adaptability in the evolving trade landscape. 
• Importance of India-UK FTA Deal: It is critical in providing a window into India’s strategy for future Western negotiations and its handling of non-trade issues like environmental and labour standards. 
  • For example, the FTA will serve as a template for an agreement with the EU which is the second-largest destination for Indian exports (14.9% of the total) after the USA (18.1%) in 2021. It will further help in economic integration with Western and African nations to fuel export growth.

What are the Trade Agreements?

• Trade agreements are agreements between two or more countries for specific terms of trade, commerce, transit, or investment. They mostly involve mutually beneficial concessions.

• Depending on the terms and concessions agreed on by the participating bodies, there are several types of trade agreements- Free Trade Agreement, Preferential Trade Agreement, Comprehensive Economic Partnership Agreement, etc. 
• Preferential Trade Agreement (PTA): Two or more partners give preferential right of entry to certain products by reducing duties on an agreed number of tariff lines. 
• • A positive list of the products on which the two partners have agreed to provide preferential access is maintained. For example, India signed a PTA with Afghanistan.
  • India-MERCOSUR PTA: MERCOSUR is an economic grouping that comprises Argentina, Brazil, Paraguay, Uruguay, and Venezuela.
• Free Trade Agreement: Two or more countries agree to provide preferential trade terms, tariff concession, etc. to the partner country. 
  • A negative list of products and services is maintained by the negotiating countries on which the terms of FTA are not applicable. It is more comprehensive than PTA. India has negotiated FTA with many countries and regions viz.Sri Lanka, ASEAN, etc.
• Comprehensive Economic Partnership Agreement (CEPA): This partnership agreement is more comprehensive than an FTA. CEPA covers negotiation on the trade in services and investment, and it may even cover areas such as trade facilitation and customs cooperation, competition, and IPR. India has signed CEPAs with South Korea and Japan.
• Comprehensive Economic Cooperation Agreement (CECA): CECA generally covers negotiation on trade tariff and TQR rates only. It is not as comprehensive as CEPA. India has signed CECA with Malaysia.

What is the India-UK FTA Deal?

• Background: 
  • Initiation of Negotiations: Formal negotiations for a Broad-based Trade and Investment Agreement (BTIA) between India and the EU began in 2007. 
  • Rounds of Negotiations: Negotiations progressed through multiple rounds, but challenges arose over issues such as tariffs, intellectual property rights, and market access for goods and services.
  • Stalled Progress: The negotiations faced a period of stalled progress, with both sides finding it challenging to resolve key issues.
  • Post-Brexit Context: After the United Kingdom voted to leave the European Union in 2016, discussions regarding a potential trade agreement between India and the UK gained momentum. 
  • Official Launch of Negotiations and Continued Talks: Formal negotiations for the India-UK FTA were officially launched and negotiations continued as both sides engaged in multiple rounds of talks to discuss specific aspects of the agreement.
• Potential Benefits for India: India’s goals include the issue of priority visas to Indian professionals, positive signals toward a social security agreement, a specific pharma annex simplifying the pharma market access, and duty derogation for Basmati rice, etc.
• Benefits for UK: British exports to India such as cars, Scotch whisky, and wines, face considerable tariffs of 100-150%. 
• Goods Sector: India’s negotiation strategy in the goods sector has historically been a key driver for countries to engage in FTA negotiations. 
  • Attention is given to strategic trade-offs concerning dairy products, wines and spirits, electrical and electronic items, and the automotive sector’s tariffs and regulations. 
• Roadblock: UK negotiators are insisting on enhanced protection for the country’s geographical indication (GI) products originating from the agriculture sector. 
  • Key British GI items, such as Scotch whisky, Stilton cheese, and Cheddar cheese, are at the center of talks.

Know More about the INDIA-UK FTA deal here. 

What is the significance of trade agreements for India?

• Economic Growth: Trade agreements play a pivotal role in trade facilitation by reducing barriers, streamlining customs procedures, and harmonizing regulations. This expanded market access can contribute to increased sales and economic growth. 
  • For example, in the period between 2017 and 2022, India’s exports to its FTA partners increased by 31%.
• Increases Foreign Direct Investment (FDI): Trade agreements often include provisions to protect and promote foreign investments. This can attract foreign companies to invest in India, leading to technology transfer, job creation, and increased productivity.
• Employment Opportunities: Export-oriented growth, can lead to the creation of jobs that indirectly contribute to skill development by promoting industries that require specialized knowledge.
  • For example, Indian textile exports face tariffs as high as 10% in the UK, and a trade deal could put India on par with competition such as Bangladesh, and revive textile exports. 
• Secure Supply Chains: Trade agreements can provide India with a more stable and diversified supply of critical raw materials and resources, and integrate India into global value chains, participating in different stages of production. 
  • The disruption of supply chains during the pandemic exposed the risks of over-dependence on China, and the need for a ‘China-plus one’ policy, India as a potential alternative has been looking at trade deals with the UK, Australia, and EU, etc. 
• Consumer Welfare: Trade agreements can increase the variety of goods available to consumers and contribute to lower prices due to increased competition.
  • For example, the potential India- UK FTA will increase competition from cheaper, imported brands which will provide imported items at a lower price.

What potential challenges does India face in relation to trade agreements?

• Complexity in Administration: Innovative tariff barriers such as Non-Tariff Barriers (NTB) and technical barriers to trade lead to increased administrative burdens and potential disruptions to operations.
  • NTBs often come in the form of regulations, standards, testing, certification, or pre-shipment inspection that are aimed at protecting human, animal, or plant health and the environment. 
  • For example, vegetable and fruit exporters often face strict limits imposed by European economies on pesticides and other contaminants. In manufacturing too, Indian products face high rejection based on conformity assessments and technical requirements.
• Stringent Environmental Standards: Trade agreements that include environmental and social standards may lead to an increase in compliance costs affecting the competitiveness of certain sectors. 
  • For example, the European Union’s (EU) Carbon Border Adjustment Mechanism (CBAM) threatens substantial levies on products like steel and aluminum, thereby potentially impacting India’s exports to the EU.  
  • According to a consultation paper on the CBAM, the UK has shortlisted products such as cement, chemicals, glass, iron and steel, non-ferrous metals, non-metallic minerals, paper and pulp, refining, fertilizers, and power generation.
• Supply Chain Disruptions: Post-pandemic economic impact, global trade is becoming increasingly multifaceted. India faces these emerging challenges which can become major obstacles in fulfilling its ambitions of becoming an export-oriented manufacturing hub.
  • Trade war between USA and China, COVID-19-induced lockdown, conflict in Ukraine, the rising cost of oil, global economic slowdown, and climate change-induced extreme weather events are leading to supply chain disruptions.
• Competitive Pressures: In some cases, trade agreements may expose Indian industries to intense global competition, particularly if partner countries have cost advantages or more advanced technologies. 
• • For instance, in the period between 2017 and 2022, India’s exports to its FTA partners increased by 31%, while its imports increased by 82%. 
  • South Korea and ASEAN’s manufacturing sectors outperform India’s in critical industries such as electronics, automobiles, leather, and textile products, among others.
• Agricultural Concerns: Trade agreements may lead to concerns among Indian farmers about increased competition from foreign agricultural products, potentially impacting local agriculture and livelihoods.
  • India exited the Regional Comprehensive Economic Partnership (RCEP) to protect the interests of industries like agriculture and dairy.

What has India done to gain benefits from trade agreements?

• Investment in Manufacturing: The Production-Linked Incentive (PLI) scheme is strengthening India’s manufacturing sector by strategically targeting 14 key industries, including electronics, automobiles, pharmaceuticals, and more. 
• Increasing Trade Facilitation: India has implemented various trade facilitation measures to combat high transaction costs and enhance the competitiveness of its exports. 
  • These measures and the digitalisation of business processes have streamlined cargo clearance, making it paperless and more efficient. 
• Strong Infrastructure Push: Over the last nine years, India has invested around US$ 7 trillion in new projects as capital expenditures. 
  • There has been an increase in the construction of highways/roads with 10,457 kms of roads constructed in FY22 as compared to 6,061 kms in FY16. 
  • This is coupled with the capital expenditure on railways infrastructure and the aim of achieving 100% electrification by 2024.
• Policy Uptick Towards Increased Investments: Over the past few years, India has made considerable efforts to liberalising its foreign direct investment regime and increasing efficiencies in tax systems through the introduction of GST, faceless assessments, advance ruling authorities, etc.
  • For instance, the introduction of a National Intellectual Property Rights (IPR) Policy in 2016 reduces complexities in incoming investments and trade.

Way Forward: 

• Ensuring Policy Clarity: There is a need to clearly chart out policy plans for the next few years and implement them backward. India has come out with many tax and trade policies in the recent past to facilitate genuine investments and for taxpayers, long-term clarity may be  missing. 
  • For example, the recently changed stance on import licensing for laptops is an indicator in this regard. 
• Insight and Agility: There is a need for a clear strategy in response to global shifts, including recommendations for trade and associated regulations. There is a need to have clear insights into the role of India’s Missions to the World Trade Organisation (WTO),  various countries, etc., and swift analysis and response is a must to determine India’s stance.
  • For example, despite the CBAM draft being discussed in various forms since 2019, there is not enough done to educate exporters about CBAM effects.
• Pros and Cons Study: Have an unbiased study of India’s existing FTAs and drive pros and cons, which can help in upcoming negotiations.

• • For example, the analysis could be on economic, supply changes, experiential, or geo-strategic lines, but should be clear and brief.
• New Delhi Effect: The ‘Brussels effect was coined due to the EU’s lead in international trade regulations over the past couple of decades. 
  • India needs to go for further policies in a manner that becomes a template for the less developed world which would be righteous considering India’s unique positioning as a leader of this bloc in the WTO and other organisations.
• Learning from Experience: As India navigates international trade, it must leverage its past FTA experiences, evaluate the present trade landscape, and prepare strategically for future challenges to fulfill its economic ambitions and contribute meaningfully to global trade.
  • For example, India signed the CEPA with the United Arab Emirates and the ECTA with Australia, and India’s exports to both countries have shown a significant increase in a few months.

Conclusion:

In summary, India is adapting its trade strategy with evolving Free Trade Agreements, emphasizing lessons from past deals, and needs clear policies and agility to navigate global shifts for economic growth and meaningful contributions to international trade.

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