CSE PRELIMS 2020:

VALUE ADDITION SERIES PART-III

ECONOMY
 LEARN, UNLEARN
& RE-LEARN

S. No. Chapter Name Page No.

01. National Income and Accounting 2-3
02. Unemployment & Poverty 4-5
03. Money and Banking 6-8
04. Government Budgeting 9-10
05. Industry 11-14
06. International Economics 15-17
07. Agriculture 18-22
08. Infrastructure and Energy 23-26
09. Reports and Indices 27-29
10. Miscellaneous 30-33

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 NATIONAL INCOME
AND ACCOUNTING 01
1. Shapes of economic recovery 2. GDP - linked bond

1. Shapes of economic recovery

Context:
Various economists have projected various types of post-pandemic recovery of the economy.

Details:

U-shaped recovery:
A U-shaped recovery — resembling a bathtub — is a scenario in which the economy, after falling,
struggles and muddles around a low growth rate for some time, before rising gradually to usual
levels.

W-shaped recovery:
A W-shaped recovery is a scenario in which growth falls and rises, but falls again before recovering
yet again, thus forming a W-like chart.

V-shaped recovery:
The next-best scenario is a V-shaped recovery in which the economy quickly recoups lost ground
and gets back to the normal growth trend-line.

L-shaped recovery:
The L-shaped recovery is the worst-case scenario, in which growth after falling, stagnates at low
levels and does not recover for a long, long time.

Z-shaped recovery:
 The Z-shaped recovery is the most-optimistic scenario in which the economy quickly rises like a
phoenix after a crash.
 It more than makes up for lost ground (think revenge buying after the lockdowns are lifted)
before settling back to the normal trend-line, thus forming a Z-shaped chart.

K-shaped recovery:
A K-shaped recovery occurs when an economy recuperates unevenly, and there's a separate trajectory
for two segments of the society.

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 Image source: Financial Times

2. GDP - linked bond

Context:
Government has announced multiple relief packages and in order to finance them GDP-linked bonds
as a method was discussed.

Details:
 Indian economy has been hit hard due to COVID-19. So, the priority is to kick-start GDP growth
and bring the economy back in shape.
 The government in GDP-linked bonds may issue listed, Indian rupee-denominated, 25-year
GDP-linked bonds that are callable from, say, the fifth year.
 The interest on such bonds is correlated to the GDP growth rate and is subject to a cap.
 Here, the Government i.e. the issuer is liable to pay a lower interest during years of slower
growth and vice-versa.
 The callable feature from the fifth year till maturity allows the central government to make partial
payments during high growth years and when it earns non-recurring revenues such as proceeds
from disinvestment from the various public sector enterprises (PSEs).
 The investors are also provided with an exit option in this system.
 Some countries such as Argentina and Greece issued similar GDP-linked bonds in 2005 and 2012
respectively. So, India could learn from their experience.

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 UNEMPLOYMENT
AND POVERTY 02
1. Skills Build Reignite 4. Atma Nirbhar Skilled Employee
2. SWADES (Skilled Workers Arrival Employer Mapping (ASEEM)
Database for Employment Support) 5. AIM-iCREST
3. Garib Kalyan Rojgar Abhiyan (GKRA)

1. Skills Build Reignite

Context:
Ministry of Skill Development & Entrepreneurship (MSDE)-IBM Partnership launched Free Digital
Learning Platform “Skills Build Reignite”.

Details:
 It is made to reach more job seekers and provide new resources to business owners in India.
 It provides job seekers and entrepreneurs, with access to free online coursework and mentoring
support designed to help them reinvent their careers and businesses.
 IBM volunteers will serve as mentors to some of the 30,000 Skills Build users.
 Its special feature is the personalized coaching for entrepreneurs, seeking advice to help establish
or restart their small businesses as they begin to focus on recovery to emerge from the COVID 19
pandemic.

2. SWADES (Skilled Workers Arrival Database for Employment Support)

Context:
SWADES is a joint initiative of the Ministry of Skill Development & Entrepreneurship (MSDE), the
Ministry of Civil Aviation and the Ministry of External Affairs.

Details:
 Its objective is to conduct a skill mapping exercise of the returning citizens under the Vande
Bharat Mission.
 It aims to create a database of qualified citizens based on their skill sets and experience to tap
into and fulfill the demand of Indian and foreign companies.
 The collected information will be shared with the companies for suitable placement opportunities
in the country.

3. Garib Kalyan Rojgar Abhiyan (GKRA)

Context:
The GKRA was launched to start extensive public works to provide livelihood opportunities and
create local employment to returnee migrants and similarly affected rural citizens.

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Details:
 As part of this Abhiyan, Jal Jeevan Mission aims at providing household tap connections to
every rural household and offers a huge opportunity to engage skilled, semi-skilled and migrant
returnees in drinking water supply related works.
 States have been requested to start works in villages of these districts so that it will not only help
to ensure an adequate quantity of water at the household level but will also help in providing
employment to migrant returnees.
 States have been advised to prioritize taking up works of ‘low hanging fruits’ i.e. by augmenting
or retrofitting existing piped water supply schemes so that these villages become 100%
Functional Household Tap Connection (FHTC) villages.

4. Atma Nirbhar Skilled Employee Employer Mapping (ASEEM)

Context:
Ministry of Skill Development and Entrepreneurship launches an AI-based ASEEM digital platform
to bridge the demand-supply gap of skilled workforce across sectors.

Details:
 The portal and app will have provision for registration and data upload for workers across job
roles, sectors and geographies.
 The skilled workforce can register their profiles on the app and can search for employment
opportunities in their neighbourhood.
 Through ASEEM, employers, agencies and job aggregators looking for skilled workforce in
specific sectors will also have the required details at their fingertips.
 It will enable policymakers to take a more objective view of various sectors.

5. AIM-iCREST

Context:
Atal Innovation Mission launches ‘AIM-iCREST’.

Details:
 AIM-iCREST is an incubator capabilities enhancement programme for a robust ecosystem for
creating high-performance start-ups.
 AIM has launched the programme in collaboration with the Bill & Melinda Gates Foundation
and the Wadhwani Foundation.

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 MONEY AND
BANKING 03
1. Banking Regulation (Amendment) 4. Partial Credit Guarantee Scheme (PCGS)
Ordinance, 2020 2.0
2. Payments Infrastructure Development 5. AT-1 Bonds
Fund (PIDF) 6. Teaser loans
3. Ways and Means Advances (WMA) of
RBI

1. Banking Regulation (Amendment) Ordinance, 2020

Context:
In pursuance of the commitment to ensure the safety of depositors across banks, the President has
promulgated the Banking Regulation (Amendment) Ordinance, 2020.

Provisions:
 The amendments to bring urban cooperative banks and multi-state cooperative banks under the
supervision of RBI.
 The Ordinance has empowered RBI to supersede the Board of Cooperative Banks for up to five
years.
 The amendments do not affect existing powers of the State Registrars of Co-operative Societies
under state co-operative laws.
 The amendments also do not apply to Primary Agricultural Credit Societies (PACS) or
cooperative societies whose primary object and principal business is long-term finance for
agricultural development.
 The ordinance also gives powers to RBI to make a scheme of reconstruction or amalgamation of a
banking company without imposing a moratorium.

2. Payments Infrastructure Development Fund (PIDF)

Context:
The RBI has created a Payments Infrastructure Development Fund (PIDF) to encourage acquirers to
deploy Points of Sale (PoS) infrastructure — both physical and digital modes — in tier-3 to tier-6
centres and northeastern states.

Details:
 RBI will make an initial contribution of ₹250 crore to the PIDF, covering half of the fund, while
the remaining contribution will be from card-issuing banks and card networks operating in the
country.
 The PIDF will be governed through an Advisory Council and managed and administered by
RBI.

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3. Ways and Means Advances (WMA) of RBI

Context:
The Central Bank has raised the limit for the short term credit that the government can borrow from
the RBI.

Details:
 The limits for WMA which is a credit facility has been raised sharply to Rs 1.2 lakh crore for the
first half of 2020-21.
 WMAs are temporary loan facilities provided by RBI to the government.
 It enables the government both centre and states to buffer the temporary mismatches between
their revenue and expenditure.
 The government however makes an interest payment to the RBI when it borrows money.
 The rate of interest is the same as the repo rate, while the tenure is for 3 months. (Repo rate is
basically the rate at which RBI lends short-term money to banks).
 The limits for WMA are mutually decided by the Central bank and the Government of India.

4. Partial Credit Guarantee Scheme (PCGS) 2.0

Context:
As part of Aatmanirbhar Bharat Abhiyan, Government has extended the scope of the PCGS 2.0 to
provide greater flexibility to state-owned banks in purchasing bonds and Commercial Papers of the
Non-Banking Financial Companies (NBFCs).

Details:
 Under this scheme, PSBs can purchase securities even with a minimum rating of ‘AA’ of non-
banking finance companies which are financially-sound.
 Its major objective is to address the temporary asset-liability mismatches of otherwise solvent
NBFCs/Housing finance companies (HFCs) without having to resort to distress sale of their
assets to meet their commitments.
 The government will provide a one-time, 6 months partial credit guarantee to the public sector
banks for first loss of up to 10%.
 Also, these NBFCs/HFCs are mandated that the capital to risk-weighted assets ratio (CRAR) shall
not go below the regulatory minimum while exercising the option to buy back the assets.

5. AT-1 Bonds

Context:
The Reserve Bank of India (RBI) has made a proposal to write-down the Additional Tier-1 (AT-1)
bonds as part of the SBI-led restructuring package for the Yes Bank.

Details:
 AT-1 bonds are a type of unsecured and perpetual bonds issued by banks.
 These bonds are issued by banks to shore up their core capital base to meet the Basel-III norms.
 There are basically two routes through which these bonds can be acquired i.e Initial private
placement offers and secondary market buys.
 These bonds are like any other bonds issued by banks or other companies but pays slightly
higher interest rates.
 These bonds are also listed and traded on the exchanges. So, if an AT-1 bondholder needs
money, he can sell it in the secondary market.
 It is to be noted that the investors cannot return these bonds to the issuing bank and get the
money, i.e. there is no put option available to the holders of these bonds.
 However, the issuing banks have the option to recall AT-1 bonds issued by them.
 AT-1 bonds are regulated by RBI and if it feels that a bank needs a rescue, it can ask the
concerned bank to write off its outstanding AT-1 bonds without consulting its investors.

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6. Teaser loans

Context:
Recently, the State Bank of India (SBI) planned to offer teaser loans. However, the Reserve Bank of
India (RBI) may not allow it to do so.

Details:
 The loans which charge comparatively lower rates of interest in the first few years after which the
rates are increased are called teaser loans.
 The Central Bank feels that some borrowers may find it difficult to service the teaser loans.
 This can happen once the normal interest rate which is higher than the rate applicable in the
initial years, becomes effective.
 Also, a bank which offers such loan does not take into account the borrowers repayment capacity
after lending rates increase while extending the loan.

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 GOVERNMENT
BUDGETING 04
1. Border Adjustment Tax (BAT) 3. Monetisation of the deficit
2. Equalization Levy 4. Minimum Alternative Tax (MAT)

1. Border Adjustment Tax (BAT)

Context:
NITI Aayog member V.K. Saraswat has favoured imposing a Border Adjustment Tax (BAT) on
imports to provide a level-playing field to domestic industries.

Definition:
 Border Adjustment Tax means that a tax is levied on imports (goods made overseas) and exports
are not taxed.
 It is imposed on imported goods in addition to the customs levy that gets charged at the port of
entry.

2. Equalization Levy

Context:
The US launched investigations into digital services taxes levied or under consideration by 10
countries, including India, to determine whether they discriminate against American tech companies.

Details:
 India introduced an equalization levy through Finance Act 2016 on certain non-resident
businesses like mobile phone apps, social media platforms, and digital content streaming
services with a customer base in India. The levy was applied at a rate of 6% on online
advertisements on such platforms.
 Equalisation levy is a special levy, charged by the Indian government on digital transactions,
outside the purview of Indian income tax law.
 Thus, this is a unilateral levy, where non-resident companies may not be able to claim any tax
treaty benefits.
 However, Finance Act 2020 introduced a new provision providing for equalisation levy on
revenues generated by e-commerce operators.
 The new provision significantly widens the scope of equalisation levy, which provides that
consideration received/ receivable by a nonresident e-commerce operator, from the online sale
of goods or online provision of services or a combination of both, shall be subject to 2 percent
equalisation levy with effect from April 1, 2020.
 New equalisation levy shall be charged on the revenue earned from either selling goods or
services to Indian resident customers or other customers using Indian IP addresses or sale of data
collected from Indian residents/ Indian IP address or from the sale of advertisement targeting
Indian customers.
 It may be important to note that new equalisation levy provisions are applicable only if aggregate
revenues for a non-resident e-commerce operator exceed a threshold of Rs 2 crores.

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3. Monetisation of the deficit

Context:
Many experts suggested that the Indian government should monetise its deficit.

Details:
 When the expenditure of the government exceeds its income, the government is said to have
incurred a fiscal deficit.
 The government has to finance this deficit either by borrowing from the market or monetisation
of the deficit through RBI.
 Monetization of fiscal deficits means the financing of such extra expenses with money instead of
borrowing. So, it is a form of "non-debt financing".
 There are two methods of this type of deficit financing.
o Direct Monetization (DM): RBI prints new currency and purchases government bonds
directly from the primary market (from the government) using this currency.
o Indirect monetization (IM): Government issues bonds in the primary market and the RBI
purchases an equivalent amount of government bonds from the secondary market in the
form of Open Market Operations (OMOs).

4. Minimum Alternative Tax (MAT)

Context:
Recently, a panel appointed by the government has submitted its report on the direct taxes and its
legislation. It has suggested some changes in Minimum Alternate Tax (MAT).

Details:
 MAT is a provision in the direct tax laws to limit the various tax exemptions, deductions, etc.
availed by companies so that they pay at least a minimum amount of corporate tax to the
government.
 MAT is calculated at 18.5% on the book profit or at the usual corporate rates, and whichever is
higher is payable as tax.
 Book profit here refers to the profit shown in the profit and loss account of the company.
 All companies in India, whether domestic or foreign, fall under this provision.
 It was introduced by the Finance Act, 1987 but withdrawn in 1990. Later it was reintroduced by
the Finance Act, 1996.
 MAT is an important tool with which tax avoidance can be prevented.

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 INDUSTRY 05
1. Atmanirbhar Bharat 3. Zombie firms
2. PM Formalization of Micro Food
Processing Enterprises (PM FME)

1. Atmanirbhar Bharat

Context:
The Prime Minister announced an economic package totaling Rs 20 lakh crore to tide over the Covid-
19 crisis under ‘Atmanirbhar Bharat Abhiyan’.

Details:
 Its vision is to make India a self-reliant nation.
 India’s self-reliance will be based on five pillars — economy, infrastructure, technology-driven
system, vibrant demography and demand.
 As part of self-reliance, the Government announced the special economic package which is
around 10% of India’s GDP.
 The package includes the ongoing Pradhan Mantri Garib Kalyan Yojana (PMGKY), meant to
support the poorest and most vulnerable communities during the pandemic, as well as several
measures taken by the Reserve Bank of India to improve liquidity.

1.1 Measures for MSME

Definition of MSMEs was changed:
 MSMEs will be defined not based on their investment alone but also on their turnover.
 The existing distinction between manufacturing and service units has been eliminated.
 A unit with up to 1 crore rupees investment and 5 crore rupees turnover will qualify as a micro-
unit.
 Investment up to 10 crore rupees and turnover up to 50 crore rupees will qualify as a small unit.
 Investment up to 50 crore rupees and turnover up to 250 crore rupees will qualify as a medium
enterprise.

Liquidity
 The ₹3 lakh crore emergency credit line announced will ensure that MSMEs will have access to
working capital.
 For MSMEs that are stressed or considered non-performing assets, the Centre will facilitate the
provision of ₹20,000 crores as subordinate debt.
 MSME Fund of funds system - A ₹50,000 crore equity infusion is also planned, through an
MSME fund of funds with a corpus of ₹10,000 crores.

1.2 Measures for NBFC

 The government announced Rs 30,000 crore of a special liquidity scheme, under which
investment will be made in investment-grade debt papers of these institutions

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 If a government entity directly buys debt papers of these entities, then it would provide major
relief
 The government has also extended the partial credit guarantee scheme — under which it
guarantees 20 percent of the first loss to the lenders — NBFCs, HFCs and MFIs with low credit
rating.

1.3 Measures for DISCOMS

 State-owned Power Finance Corp. (PFC) and Rural Electrification Corp. (REC) will infuse the
liquidity by raising ₹90,000 crores from the markets against the receivables of DISCOMs.
 It will help in clearing the outstanding dues of DISCOMs.
 These funds will be then given to DISCOMs against state government guarantees for the sole
purpose of discharging their liabilities.
 The idea is to clear the payment backlog with concessional loans guaranteed by the respective
state governments.

1.4 Measures for Real Estate

 The Union Housing and Urban Affairs Ministry will advise States and Union Territories and
their regulatory authorities to extend the registration and completion date of real estate projects
by six months.
 Six-month extension and treatment of the COVID-19 pandemic as an event of force majeure, like a
natural calamity, under the Real Estate (Regulation and Development) Act, would de-stress the
sector and ensure completion of projects.

1.5 Measures for Common man

Provident fund (Pf) contribution:
 Under the Pradhan Mantri Garib Kalyan Yojana, the government agreed to pay the 24%
provident fund contribution (employer+employee) for those earning up to 15,000 rupees a month
as salary and working in units that employ less than 100 workers for three months.
 This was extended for another three months up to August 2020.
 The statutory PF contribution for those employed in the private sector and not in the category of
establishments as above has been reduced to 10% (from 12% now) for the next three months in
order to increase liquidity in their hands.

TDS/TCS:
 The rate of tax deducted at source (TDS) and tax collected at source (TCS) has been reduced by
25% for a range of receipts.
 In the cases where TDS/TCS has been reduced, the tax liability is not reduced. It will be payable
while filing a return or while paying advance tax.

1.6 Measures for Migrants

Ration:
 Free food-grain supply to all migrants for the next 2 months.
 Non-Cardholder Migrants shall be given 5 KG rice/wheat & 1 KG Chana per family for 2 months.
 National portability of ration cards with 'one Nation one ration card' will be implemented by
August 2020.
 67 crore beneficiaries will gain in 23 states, using this ration card in any corner of the nation in the
next three months.

Housing:
 Affordable rental accommodation for migrant labour and urban poor.
 A rental housing scheme will be incentivised to build affordable housing and convert government
housing into rental housing under PM Awas Yojana.

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1.7 Measures for Street vendors

 Rs. 5000 crore special credit facility for street vendors which will benefit 50 lakh street vendors.
 They will receive an initial working capital up to Rs 10000, within a month.

1.8 Measures for tribals

Employment for tribals via Rs 6000 crores using Compensatory Afforestation Management &
Planning Authority (CAMPA) Funds. This will create job opportunities in Urban, Semi-urban & rural
areas for Afforestation & plantation works.

1.9 Measures for Farmers

 30,000 crore additional emergency working capital funding for farmers via NABARD.
 While 90,000 crore has already been sanctioned by NABARD, an additional Rs 30,000 crore will
be pushed into this.
 Farmers holding Kisan Credit Cards will be provided a concessional Credit boost amounting to
Rs 2 lakh crore.

1.10 Measures for the coal sector

 The government monopoly on coal would be removed with the introduction of commercial
mining on a revenue-sharing basis.
 Any private player would be allowed to bid for a coal block and sell it in the open market as
against the earlier system where only captive consumers with end-use ownership could bid for
coal blocks.
 The private sector would be allowed to bid for 50 coal blocks. Private players would also be
allowed to undertake exploration activities.
 The government also plans to auction Coal Bed Methane (CBM) blocks.

1.11 Measures for the defence sector

Indigenization:
 Banning the import of some weapons and platforms. The list of such weapons and platforms
would be widened every year as domestic capacities grew.
 Indigenisation of imported spare parts would be given priority.
 Provision for a separate budget for domestic capital procurement.

Foreign investment:
The Foreign Direct Investment (FDI) limit in defence manufacturing under automatic route will be
raised from 49% to 74%.

Corporatization of ordnance factory:

Ordnance Factory Boards (OFB) would be corporatized and listed on the stock market to improve
autonomy, efficiency and accountability. However, they would not be privatised.

1.12 Measures for Power sector:

 Power departments/utilities and distribution companies in the U.T.s would be privatized based
on a new tariff policy to be announced.
 The government plans to introduce a tariff policy with reforms focused on consumer rights,
promotion of industry and sustainability of the sector.

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1.13 Measures for the Aviation sector:
 Six more airports are up for auction on private-public partnership (PPP) mode, while additional
private investment will be invited at 12 airports.
 Rationalising the MRO (maintenance, repair and operations) sector tax structure with an aim to
make India an MRO hub.

1.14 Public Sector Enterprise Policy

 The new policy will notify specific strategic sectors in which at least one PSU will remain,
although private companies will also be allowed.
 Even in the strategic sectors, no more than four PSUs will be allowed, with the rest being
privatised, merged or brought under holding companies.
 PSUs in all other sectors will be privatised.

1.15 The Insolvency and Bankruptcy Code (IBC) and the Companies Act
 Fresh insolvency proceedings would be suspended for a year.
 COVID-19 related debt will not trigger defaults.
 Firms will be allowed to list abroad directly

2. PM Formalization of Micro Food Processing Enterprises (PM FME)

Context:
Ministry of Food Processing Industries (MoFPI) launched the PM Formalisation of Micro food
processing Enterprises Scheme (PM FME) Scheme.

Details:
 It is a Centrally Sponsored Scheme in partnership with the State/ UT Governments.
 It will provide financial, technical and business support for upgradation of existing micro food
processing enterprises.
 The expenditure under the scheme would be shared in 60:40 ratio between Central and State
Governments, in 90:10 ratio with North Eastern and Himalayan States, 60:40 ratio in UTs with
legislature and 100% by Centre for other UTs.
 The Scheme adopts One District One Product (ODOP) approach.
 The States would identify food products for a district keeping in view the existing clusters and
availability of raw material.
 The ODOP product could be a perishable produce based product or cereal-based products or a
food product widely produced in a district and their allied sectors.
 The Scheme also place focus on waste to wealth products, minor forest products and Aspirational
Districts.

3. Zombie firms

Context:
India is said to be moved from socialism with a limited entry for the firms to capitalism without exit.
It is here when capitalism without exit is considered to be zombieland i.e.companies neither dead nor
alive.

Details:
 The Firms which are not able to cover their debt-servicing costs with current earnings are called
Zombie firms.
 This problem has been further intensified by Covid-19 and subsequent lockdowns.
 In the financial world, the companies that are on life support are generally called as Zombies.
 These companies are in bad shape and have gone out of business but yet being kept alive.
 These firms have then been rescued by loan moratoriums, loan guarantees, and evergreening of
debts.
 Although these are good measures and provide immediate relief but can also create ever-more
zombies.

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 INTERNATIONAL
ECONOMICS 06
1. Changes in FDI Policy 5. Instrument in Support of Trade
2. International sovereign bonds by Indian Exchanges (INSTEX)
Government 6. Corona bond and frugal four
3. Catastrophe Containment and Relief 7. International Financial Services Centres
Trust (CCRT) of IMF Authority (IFSCA)
4. Rice Export Promotion Forum

1. Changes in FDI Policy

Context:
The government recently made some changes in Its FDI policy with the objective of preventing an
opportunistic takeover of firms hit by the lockdown induced by the COVID-19 outbreak.

What has changed?

 The Department for Promotion of Industry and Internal Trade has made prior government
approval mandatory for foreign direct investments from countries that share a land border with
India.
 This also applies even if the investing company is not located in a neighbouring country, it would
still be subject to these conditions if its owner is a citizen or resident of such a country.

FDI Entry Routes:

 Automatic: The non-resident or Indian company does not require any approval from GoI for
investing through the Automatic route. The overseas investors are only required to notify the
Regional Office concerned of the Reserve Bank of India
 Government Route: Approval form the GoI is required prior to investment. Investment
proposals under the Government route are considered by the respective Administrative Ministry.

List of Prohibited Sectors:

 Lottery Business including Government/ Private lottery, online lotteries, etc.
 Manufacturing of Cigars, cheroots, cigarillos and cigarettes
 Sectors not open to private sector investments such as atomic energy, etc

2. International sovereign bonds by Indian Government

Context:
The government proposed that the funding of fiscal deficit would be partially done by borrowing
from international/external markets in foreign currency. The government from its first overseas
sovereign bond plans to raise $10 billion.

Details:
 A sovereign bond is a specific and unique debt instrument which is issued by the government.
 These bonds can be denominated in both foreign and domestic currency.

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 It promise to pay the buyer a certain amount of interest for a stipulated number of years and
repay the face value on maturity, just like other bonds,
 These bonds have a rating associated with them which essentially speaks of their credit
worthiness.
 The yield of the bonds are dependent on primarily 3 factors i.e. creditworthiness, country risk and
exchange rates.
 This yield of the bond is the interest rate that the government pays on issuing bonds.

3. Catastrophe Containment and Relief Trust (CCRT) of IMF

Context:
International Monetary Fund (IMF) has approved a grant of $500 million for 25 of the world's most
impoverished countries to cancel 6 months of debt payments. The money will come from the IMFs
revamped Catastrophe Containment and Relief Trust (CCRT) which will use recent pledges by the
United Kingdom and Japan.

Details:
 This will provide grants to the poorest and most vulnerable member countries to tackle the
Covid-19 pandemic.
 It will help these countries to channel more of their scarce financial resources towards vital
emergency medical and other relief efforts.
 The CCRT allows the IMF to provide grants for debt relief for some of the poorest and most
vulnerable countries that are hit by the natural or public health disasters.
 CCRT was established in 2015 during the Ebola outbreak and was modified in March 2020 in
response to the Covid-19 pandemic.

4. Rice Export Promotion Forum

Context:
Government of India has recently set up the “Rice Export Promotion Forum” (REPF)

Details:
 REPF has been set up to provide stimulus to rice exports.
 It has been set up under the aegis of the Agricultural and Processed Foods Export Promotion
Development Authority (APEDA).
 It will take steps to identify, document particulars and reach out to the stakeholders across the
production and supply chain of export of rice.
 It will also monitor, identify and anticipate the developments related to production and exports
and will suggest various policy measures.
 REPF will include representatives from the rice industry, officials from Apeda, exporters,
Commerce Ministry, Agriculture Ministry and Directors of Agriculture from major rice
producing states such as Punjab, Telangana, Haryana, Assam, Andhra Pradesh, Chhattisgarh, etc.

5. Instrument in Support of Trade Exchanges (INSTEX)

Context:
Countries such as Belgium, Denmark, Finland, Netherlands, Norway and Sweden have joined
INSTEX.

Details:
 INSTEX is basically a trade mechanism established by France, Germany and the United
Kingdom in 2019 to allow them to maintain trade relations with Iran.
 This mechanism has been basically designed to circumvent U.S. sanctions against trade with
Iran by avoiding the use of the US dollar.

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 It functions as a clearing house which allows Iran to continue to sell oil and import other
products or services in exchange.
 The mechanism represents the commitment of France, Germany and the UK to the JCPOA. The
US imposed sanctions after it withdrew from the Iran nuclear deal, known as the Joint
Comprehensive Plan of Action (JCPOA), in 2018.

6. Corona bond and frugal four

Context:
Some European countries such as Spain and Italy have proposed that the European Union (EU)
should issue Corona bonds to deal with the situation created by Covid-19. However, the “Frugal
Four” countries such as Germany, Netherlands, Austria and Finland have opposed the idea.

Details:
 These bonds are joint debt issued by the EU to its member states.
 It would be collective debt that will be taken collectively amongst EU member states.
 These funds would come from the European Investment Bank.
 The aim of these bonds is to provide financial relief to Eurozone countries battered by the
coronavirus.
 So, some countries which have suffered huge deaths due to Covid-19 are demanding such kind of
economic measures from the EU to meet the extraordinary situation.
 However, the rejection of the idea is because some countries are of the opinion that finance is an
individual nation’s responsibility.

7. International Financial Services Centres Authority (IFSCA)

Context:
The Government of India has established the International Financial Services Centres Authority
(IFSCA) to regulate all its financial services in International Financial Services Centres (IFSCs) with its
headquarters in Gandhinagar (Gujarat).

Details:
 The IFSCA will regulate the various financial products such as securities, financial services,
financial institutions, etc. which have been previously approved by any of the regulators such as
the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI) etc., in an
IFSC.
 The authority may also recommend the central government for any other financial products,
financial services, or financial institutions, which may be permitted in an IFSC.
 The IFSCA will also regulate any other financial products, services or institutions in an IFSC,
which may be further notified by the central government.
 It will consist of nine members and they will be appointed by the government of India with a
term of 3 years.
 India’s first IFSC has been set up in Gandhinagar i.e. the Gujarat International Finance Tec-City
(GIFT City).

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 AGRICULTURE 07
1. e-NAM Assurance and Farm Services Ordinance
2. Reforms in Agriculture 2020
3. Kisan Sabha App 8. Direct Seeding of Rice (DSR) technique
4. Rht14 and Rht18 9. Minor Forest Produce
5. Saras Collection 10. Animal Husbandry Infrastructure
6. The Farmers’ Produce Trade and Development Fund
Commerce (Promotion & Facilitation) 11. Finance Commission’s report on
Ordinance 2020 agricultural exports
7. The Farmers (Empowerment and
Protection) Agreement on Price

1. e-NAM

Context:
Union Agriculture Minister launches new features for enhancing the effectiveness of e-NAM.

Details:

 Three modules have been launched:

1. Launch of Negotiable Warehouse Receipt (e-NWRs) module in the National Agriculture
Market (e-NAM) software:
 Small & marginal farmers can directly trade their stored produce from selected WDRA
(Warehousing Development and Regulatory Authority) registered warehouses which are
declared deemed market by the State.
2. Farmer Producer Organisation (FPO) trading module:
 FPOs can upload their produce from their premise for bidding.
 They can upload the picture of the produce and quality parameters from their premises
to help distant bidders to visualise the produce before bidding.
 FPOs have the option for delivery of products either from their premises or by bringing
to mandi premises after successful bidding.
 This will not only decongest the mandis but also reduce the logistics cost for the FPOs.
3. Launch of Logistic Module:
 Presently, e-NAM provides a database of individual transporters to the traders.
 However, as a quantum response to the logistic needs by traders, provision has been
made for linking large logistic aggregator platforms, which will provide choices to users.
 Traders would be able to use the link to navigate to the logistics provider’s website and
select appropriate services.

2. Reforms in Agriculture

Context:
Atmanirbhar Bharat Abhiyan has listed measures to deal with critical infrastructure gaps and long-
pending governance issues that plague the farm sector.

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1. Contract Farming
 Plans to ensure a facilitative legal framework to oversee contract farming.
 Contract farming can be defined as agricultural production carried out according to an
agreement between a buyer and farmers, which establishes conditions for the production and
marketing of a farm product or products.
 Contract farming would provide farmers with assured sale prices and quantities even before
the crop is sown and also allow private players to invest in inputs and technology in the
agricultural sector.

2. Essential Commodities Act, 1955

 The Act would be amended to deregulate six categories of agricultural foodstuffs: cereals,
pulses, edible oils, oilseeds, potato and onion.
 Stock limits on these commodities will not be imposed except in times of a national calamity
or a famine.
 The stock restrictions will not be imposed at all on food processors or value chain
participants, which/who will be allowed to store as much as allowed by their installed
capacity.
 Exporters will also be exempted from stock limitations.

Essential Commodities Act, 1955:

 The Essential Commodities Act, 1955 came into being at a time of food scarcity and famine.
 The Essential Commodities Act, 1955 allows the government to control price rise and
inflation by imposing stock limits and movement restrictions on commodities, giving States
the power to regulate dealer licensing, confiscate stock and even jail traders who fail to
comply with restrictions.

3. Promoting Inter-State Trade:

 A new federal law to break the monopoly of the Agricultural Produce Market Committee
(APMC) and will abolish inter-State trade barriers.
 It would allow farmers the freedom to sell across state borders.

4. Infrastructural investments:
 A 1-lakh crore rupee agriculture infrastructure fund run by the NABARD.
 It will help create an affordable and financially viable post-harvest management
infrastructure at the farm gate and aggregation points.
 The scheme will promote the formalisation of micro food enterprises under the cluster
approach focused on different regions.
 It would assist unorganised enterprises in scaling up food safety standards to earn the
product certification and build brand value.

3. Kisan Sabha App

Context:
It has been launched by the Council of Scientific and Industrial Research (CSIR) to Connect
Farmers to the Supply Chain and Freight Transportation Management System.

Details
 The app will provide the most economical and timely logistics support to the farmers.
 It will minimize the interference of middlemen and directly connect with the institutional buyers.
 It will also help in providing the best market rates of crops by comparing nearest mandis,
booking of freight vehicles at the cheapest cost.
 Kisan Sabha has 6 major modules taking care of Farmers, Mandi Dealers, Transporters, Mandi
Board Members, Service Providers and Consumers.

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4. Rht14 and Rht18

Context:
Scientists at Pune based Agharkar Research Institute (ARI), an autonomous institute of the
Department of Science and Technology, have mapped two dwarfing genes Rht14 and Rht18 in
wheat.

Details
 These genes will allow deeper sowing of wheat seeds to avail advantage of residual moisture in
the soil, therefore, saving valuable water resources and reducing the cost of cultivation to farmers.
 The presently available semi-dwarf wheat varieties, which were explored during the Green
Revolution, carry conventional Rht1 dwarfing alleles (variant form of a given gene) and produce
optimum yields under high-fertility irrigated conditions.
 However, they are not well adapted for deeper sowing conditions in dry environments.

5. Saras Collection

Context:
The Saras Collection is an initiative of the GeM, the DAY-NRLM and the Ministry of Rural
Development.

Details
 The Saras Collection showcases daily utility products made by rural Self-Help Groups (SHGs)
and aims to provide SHGs in rural areas with market access to Central and State Government
buyers.
 Under this initiative, the SHG sellers will be able to list their products in 5 product categories,
namely handicrafts, handloom/textiles, office accessories, grocery/pantry and personal
care/hygiene.

6. The Farmers’ Produce Trade and Commerce (Promotion & Facilitation) Ordinance 2020

Context:
The Farmers’ Produce Trade and Commerce (Promotion & Facilitation) Ordinance 2020 was issued
recently.

Details:
 The ordinance will provide a facilitative framework for electronic trading.
 It will provide for the creation of an ecosystem where the farmers and traders enjoy the freedom
of choice relating to sale and purchase of farmers’ produce which facilitates remunerative prices
through competitive alternative trading channels.
 It will promote efficient, transparent and barrier-free inter–State and intra-State trade and
commerce of farmers’ produce outside the physical premises of markets or deemed markets
notified under various State agricultural produce market legislations.

7. The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services
Ordinance 2020

Context:
The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services
Ordinance 2020 was issued recently.

Details:
 It provides a framework for the protection and empowerment of farmers with reference to the
sale and purchase of farm products. The provisions of the Ordinance will override all state APMC
laws.

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 The Ordinance provides for a farming agreement prior to the production or rearing of any farm
produce, aimed at facilitating farmers in selling farm produce to sponsors.
 It will provide for a national framework on farming agreements that empowers farmers to engage
with agribusiness firms, processors, wholesalers, exporters or large retailers for farm services and
sale of future farming produce at a mutually agreed remunerative price framework in a fair and
transparent manner.

8. Direct Seeding of Rice (DSR) technique

Context:
The Punjab government relaxed sowing schedules for the current year, and many farmers chose the
Direct Seeding of Rice (DSR) technique instead of traditional transplanting.

Benefits:
 According to the farmers and agricultural experts, large scale use of the DSR technique to plant
paddy could solve the staggering problem of stubble burning.
 Saves labour costs involved in sowing and transplant.
 Less water consumption for irrigation.
 Most importantly, it results in very little post-harvest stubble.
 The DSR crop gets mature 7-10 days faster than with transplantation

9. Minor Forest Produce

Context:
The Centre revised the minimum support price (MSP) for minor forest produce.

Details:
 MSP of 49 products, collected by tribals from forests, increased by the Ministry of Tribal Affairs.
 This is done under a Centrally Sponsored scheme known as “Mechanism for the marketing of
Minor Forest Produce (MFP) through Minimum Support Price (MSP) and development of value
chain for MFP.”
 Tribal Cooperative Marketing Development Federation of India (TRIFED) is the nodal agency for
the scheme. It had recommended the increase in MSP.
 MSP for MFPs is revised once every 3 years by the Pricing Cell constituted under the Ministry of
Tribal Affairs.

Minor Forest Produce (MFP):

 MFP is defined under The Scheduled Tribes and Other Traditional Forest Dwellers
(Recognition of Forest Rights) Act, 2006, popularly known as the Forests Rights Act (FRA).
 Minor Forest Produce (MFP) includes all non-timber forest produce of plant origin and includes
bamboo, canes, fodder, leaves, gums, waxes, dyes, resins and many forms of food including nuts,
wild fruits, Honey, Lac, Tusser, etc.
 The definition of MFP includes bamboo and cane, thereby changing the categorization of bamboo
and cane as “trees” under the Indian Forest Act 1927.

10. Animal Husbandry Infrastructure Development Fund

Context:
Recently, the Cabinet Committee on Economic Affairs (CCEA) had approved the establishment of the
Animal Husbandry Infrastructure Development Fund worth Rs. 15000 crores.

21 | VALUE ADDITION SERIES PART III: ECONOMY

Details:
 This fund would facilitate investments in the establishment of infrastructure for dairy and meat
processing and value addition infrastructure and establishment of animal feed plants in the
private sector.
 Farmer Producer Organizations (FPOs), MSMEs, not-for-profit companies, Private Companies
and individual entrepreneurs are eligible beneficiaries.
 Minimum 10% margin money to be contributed by the beneficiary. The balance 90% would be
the loan component to be made available by scheduled banks.
 The Government of India will provide a 3% interest subvention to eligible beneficiaries.

11. Finance Commission’s report on agricultural exports

Context:
The 15th Finance Commission had set up a High-Level Group (HLG) on Agricultural Exports. It has
submitted its report with some recommendations.

Details:

The major recommendations are:

 Focus on 22 crop value chains – demand-driven approach
 Solve Value Chain Clusters (VCC) holistically with a focus on value addition
 Create State led export plan with participation from stakeholders
 The private sector should play an anchor role
 The center should be an enabler
 A robust institutional mechanism to fund and support the implementation

State-led Export Plan

 This would be a business plan for a crop value chain cluster, that will lay out the opportunity,
initiatives and investment required to meet the desired value chain export aspiration.
 These plans will be action-oriented, time-bound and outcome-focused.
 The Group recommended that for the success of these plans, they should be prepared by
collaboration with private players and commodity boards.

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 INFRASTRUCTURE
AND ENERGY 08
1. Draft Electricity (Amendment) Bill, 2020 7. “Net Zero” Carbon Emission Mass
2. Empowered Group of Secretaries (EGoS) Transportation Network
and Project Development Cells (PDCs) 8. Rewa Solar Project
3. Negative Oil Prices 9. Aids to Navigation Bill 2020
4. Surya Nagri 10. India–US Strategic Energy Partnership
5. Real-Time Market (RTM) in Electricity
6. Private trains

1. Draft Electricity (Amendment) Bill, 2020

Context:
The power Ministry has released a revised draft of the Electricity Amendment Bill 2020 for feedback
from stakeholders.

Major amendments proposed:

 Bill aims to end industrial and commercial consumers subsidising electricity charges for domestic
consumers and farmers.
 For the needy, electricity charges would be lowered by transferring subsidy directly into the
accounts of beneficiary consumers through the DBT platform.
 The draft Bill proposes the establishment of an Electricity Contract Enforcement Authority
headed by a retired High Court Judge and with powers of a civil court.
 The regulatory regime will be strengthened by increasing the powers of the Appellate Tribunal
for Electricity.
 It also proposed a National Renewable Energy Policy for the development and promotion of the
generation of electricity from renewable sources of energy.

2. Empowered Group of Secretaries (EGoS) and Project Development Cells (PDCs)

Context:
The Cabinet has given its approval for setting up of an Empowered Group of Secretaries (EGoS) and
Project Development Cells (PDCs) in Ministries/Departments of the Central Government for
attracting investments in India.

Empowered Group of Secretaries (EGoS):

It has the Cabinet Secretary as the Chairperson and Secretary, Department for Promotion of
Industry, and Internal Trade as the Member Convenor. Secretaries of the Department of Commerce,
Department of Revenue, and Department of Economic Affairs, and the CEO, Niti Aayog are the
Members of this committee.

Project Development Cells (PDCs):

 A PDC is approved for the development of investible projects in coordination between the
Central Government and State Governments and thereby grow the pipeline of investible projects
in India and in turn increase FDI inflows.

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 Its objective is to create projects with all approvals, land available for allocation and with the
complete Detailed Project Reports for adoption/investment by investors.
 It will identify issues that need to be resolved in order to attract and finalise the investments and
put forth these before the Empowered Group.

3 Negative Oil Prices

Context:
Prices of West Texas Intermediate (WTI), the American benchmark for crude oil, fell to less than zero
in April 2020.

Details:
 The fall in prices was triggered by the expiry of futures contracts for US West Texas Intermediate
(WTI) crude.
 The prices fell as demand for oil is falling and the world, especially America, is running out of
storage space.

Does India benefits from this price crash:

 The oil import bill will fall sharply this fiscal year, giving tremendous relief to the government on
the external account front.
 India is building up its strategic reserves, taking advantage of the cheap prices.
 India has a capacity to hold over 39 million barrels of oil at its strategic reserves in
Visakhapatnam, Mangalore and Padur.

Futures:
A futures contract is a legal contract to buy or sell a commodity of standardized quality at a
predetermined date in the future.

4. Surya Nagri

Context:
The Union Government has launched a scheme for 100 percent solarization of Konark Sun Temple
and Konark town in Odisha.

Details:
 This will be done with a 100 percent Central Financial Assistance (CFA) support of around Rs 25
crore from the Indian Government through the Ministry of New and Renewable Energy.
 Implementation of this project will be done by Odisha Renewable Energy Development Agency.
 The scheme envisages setting up of 10 MegaWatt grid-connected solar project and various solar
off-grid applications like solar trees and solar drinking water kiosks.

5. Real-Time Market (RTM) in Electricity

Context:
The government launched a pan-India Real-Time Market in electricity.

Details:
 It is an organized market platform to enable the buyers and sellers pan-India to meet their energy
requirements closer to real-time operation.
 The real-time market would be for every 30 minutes in a day based on double-sided closed
auctions with a uniform price.
 Buyers/Sellers shall have the option of placing buy/sell bids for each 15-minute time block.

24 | VALUE ADDITION SERIES PART III: ECONOMY

6. Private trains

Context:
The Railways kick-started the process to allow private players to operate certain trains on its network
by inviting Request for Qualifications (RFQ) for the operation of passenger train services on over
100 routes with 150 modern trains.

Details:
 This is the first initiative for private investment in running passenger trains over the Railways
network and will attract investments of about ₹30,000 crore.
 The Delhi-Lucknow Tejas is the first train that is not operated by the Indian Railways, as
Railways geared up to allow private train operators.
 The majority of trains will be manufactured in India and the private entity will be responsible for
financing, procuring, operation and maintenance of the trains, which will be designed for a
maximum speed of 160 kmph.

7. “Net Zero” Carbon Emission Mass Transportation Network

Context:
On a mission mode, the Indian Railways is taking steps to transform itself as a ‘Net Zero’ Carbon
Emission Mass Transportation Network by 2030.

Details:
 The Railways is looking to solarise railway stations by utilizing its vacant lands for Renewable
Energy (RE) projects.
 The Ministry of Railways has decided to install solar power plants on its vacant unused lands on
a mega scale.
 The Indian Railways’ present demand would be fulfilled by the solar projects being deployed,
making it the first transport organisation to be energy self-sufficient.

8. Rewa Solar Project

Context:
PM dedicated to the nation the 750 MW Rewa Solar Project.

Details:
 This project comprises three solar generating units of 250 MW each located on a 500-hectare plot
of land situated inside a Solar Park.
 The Solar Park was developed by the Rewa Ultra Mega Solar Limited (RUMSL), a Joint Venture
Company of Madhya Pradesh Urja Vikas Nigam Limited (MPUVN), and Solar Energy
Corporation of India (SECI), a Central Public Sector Undertaking.
 The project is also the first renewable energy project to supply to an institutional customer
outside the State, i.e. Delhi Metro, which will get 24% of energy from the project with the
remaining 76% being supplied to the State DISCOMs of Madhya Pradesh.
 India has committed to achieving the target of 175 GW of installed renewable energy capacity by
the year 2022, including 100 GW of solar installed capacity.

9. Aids to Navigation Bill 2020

Context:
Shipping Ministry issues draft “Aids to Navigation Bill 2020” for public consultation.

Details:
 The draft bill is proposed to replace the almost nine decades old Lighthouse Act, 1927, to
incorporate the global best practices, technological developments and India’s international
obligations in the field of Aids to Marine Navigation.
 It also provides for the identification and development of heritage lighthouses.

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10. India–US Strategic Energy Partnership

Context:
An India Energy Modeling Forum was launched in the joint working group meeting of the
Sustainable Growth Pillar.

Sustainable Growth (SG) Pillar:

 It is an important pillar of the India–US Strategic Energy Partnership co-chaired by NITI Aayog
and USAID.
 The SG pillar entails energy data management, energy modelling and collaboration on low
carbon technologies as three key activities.

Energy Modeling Forum (EMF):

 The EMF in the USA was established in 1976 to connect leading modelling experts and decision-
makers from government, industry, universities, etc.
 The forum provides an unbiased platform to discuss the contemporary issues revolving around
energy and the environment.

26 | VALUE ADDITION SERIES PART III: ECONOMY

 REPORTS AND
INDICES 09
1. Energy Transition Index Report 4. Indian Gas Exchange (IGX)
2. Global Nutrition Report 2020 5. World Investment Report 2020
3. Global Economic Prospects (GEP) Report 6. Agridex

1. Energy Transition Index Report

Context:
Energy Transition Index Report 2020 was released by the World Economic Forum (WEF). India has
moved up two positions to rank 74th on a global ‘Energy Transition Index’

Why has India improved?

 The government-mandated renewable energy expansion programme, now extended to 275 GW
by 2027.
 Significant strides in energy efficiency through bulk procurement of LED bulbs, smart meters,
and programs for the labeling of appliances.
 India’s improvements have come across all three dimensions of the energy triangle -- economic
development and growth, energy access and security, and environmental sustainability.

2. Global Nutrition Report 2020

Context:
Global Nutrition Report 2020 was released.

Details:
 The Global Nutrition Report was conceived following the first Nutrition for Growth Initiative
Summit (N4G) in 2013. The first report was published in 2014.
 This report is produced by the Independent Expert Group of the Global Nutrition Report,
supported by the Global Nutrition Report Stakeholder Group.
 It assesses progress in meeting Global Nutrition Targets established by the World Health
Assembly.
 The World Health Organization (WHO) is a Global Nutrition Report Partner.

In 2012, the World Health Assembly identified 6 nutrition targets for maternal, infant and young
child nutrition to be met by 2025. These require governments to:
1. Reduce stunting by 40% in children under five
2. Reduce the prevalence of anaemia by 50% among women in the age group of 19-49
3. Ensure a 30% reduction in low-birth weight
4. Ensure no increase in childhood overweight
5. Increase the rate of exclusive breastfeeding in the first six months up to at least 50%
6. Reduce and maintain childhood wasting to less than 5%.

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India’s position:
 According to the Global Nutrition Report 2020, India is among 88 countries that are likely to miss
global nutrition targets by 2025.
 India will miss targets for all four nutritional indicators for which there are data available —
stunting among under-five children, anaemia among women of reproductive age, childhood
overweight and exclusive breastfeeding.

3. Global Economic Prospects (GEP) Report

Context:
Global Economic Prospects was released.

About:
 Global Economic Prospects is a World Bank Group flagship report that examines global
economic developments and prospects, with a special focus on emerging markets and developing
economies.
 It is issued twice a year, in January and June.

Key Findings:
 It said that the COVID-19 pandemic is expected to have severe short and long term effects on
economic growth.
 According to the report, 90% of economies would be in recession, higher than levels seen during
the Great Depression of the 1930s
 Sixty million people could be pushed into extreme poverty
 The World Bank expects India's economy to contract 3.2 percent in the current fiscal. It has cited
stringent lockdown and spillover from weaker global growth

4. Indian Gas Exchange (IGX)

Context:
India’s first gas exchange i.e. the Indian Gas Exchange (IGX) was launched recently.

Details:
 The IGX is a digital trading platform that will allow buyers and sellers of natural gas to trade
both in the spot market and in the forward market for imported natural gas across three hubs at
Dahej and Hazira in Gujarat, and Kakinada in Andhra Pradesh.
 The exchange also allows much shorter contracts for delivery on the next day, and up to a month
while ordinarily, contracts for natural gas supply are as long as six months to a year.
 The price of domestically produced natural gas is decided by the government. It will not be sold
on the gas exchange.

5. World Investment Report 2020

Context:
The World Investment Report 2020 was released.

About:
 The World Investment Report released by UNCTAD (United Nations Conference on Trade and
Development).
 India jumped from 12th position in 2018 to 9th in 2019 on the list of the World’s top FDI
recipients.
 Most of the investments were in the information and communication technology (ICT) and the
construction industry.
 Singapore is the largest source of FDI in India during the last fiscal. It was followed by
Mauritius, the Netherlands, the US, Cayman Islands, Japan and France.
 The US has the largest inflow of FDI followed by China and Singapore.

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6. Agridex

Context:
National Commodity and Derivatives Exchange (NCDEX) announced the commencement of trading
in the country’s first agriculture futures index called AGRIDEX.

Details:
 AGRIDEX is India’s first return based agricultural futures Index which tracks the performance of
the ten liquid commodities (both Kharif and rabi seasons) traded on the NCDEX platform.
 Ten commodities include Castor seed, Chana, Coriander, Cotton Seed Oil cake, Guar Gum, Guar
Seed, Jeera, Mustard Seed, Ref Soya oil and Soybean.

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 MISCELLANEOUS 10
1. Quality Council of India 7. Agreement signed between GOI and
2. Turant Customs World Bank
3. SATYABHAMA (Science and 8. BharatMarket
Technology Yojana for Aatmanirbhar 9. Chak-Hao (Black rice of Manipur) - GI
Bharat in Mining Advancement) tag
4. Social Stock Exchange 10. Green Bonds - issued by SBI on India
5. International Comparison Program (ICP) INX’s Global Securities Market Platform
6. The Consumer Protection Act, 2019 11. GAFA tax

1. Quality Council of India

Context:
The government reviewed the Quality Council of India.

Details:
 QCI is registered as a non-profit society with its own Memorandum of Association.
 Quality Council of India (QCI) was set up jointly by the Government of India and the Indian
Industry represented by the three premier industry associations i.e. ASSOCHAM, CII and FICCI.
 The objective is to establish and operate a national accreditation structure and promote quality
through the National Quality Campaign.
 The Chairman of QCI is appointed by the Prime Minister on the recommendation of the
industry to the government.
 The Department for Promotion of Industry and Internal Trade, Ministry of Commerce &
Industry, is the nodal ministry for QCI.

2. Turant Customs

Context:
Central Board of Indirect Taxes and Customs, launched its flagship programme “Turant Customs”,
at Bengaluru and Chennai.

Details:
Importers will now get their goods cleared from customs after a faceless assessment is done remotely
by the Customs officers located outside the port of import.

3. SATYABHAMA (Science and Technology Yojana for Aatmanirbhar Bharat in Mining

Advancement)

Context:
The mines ministry announced the launch of a portal "SATYABHAMA" with an aim to promote
research and development in the mining and minerals sector.

30 | VALUE ADDITION SERIES PART III: ECONOMY

Details:
This portal will allow online submission of project proposals along with monitoring of the same and
utilisation of funds.

4. Social Stock Exchange

Context:
The idea of a social stock exchange (SSE) for the listing of social enterprise and voluntary
organisations was mooted by the Finance Minister while presenting the Union Budget 2019-20.

Details:
 Social Stock Exchange is a platform that allows investors to buy shares in social enterprises vetted
by an official exchange.
 Such enterprises would have to share with the public the details of their activities and
investments in a transparent manner.

5. International Comparison Program (ICP)

Context:
 The World Bank has released new Purchasing Power Parities (PPPs) for the reference year 2017,
under the International Comparison Program (ICP).
 Globally, 176 economies participated in the 2017 cycle of ICP.

Details:
 It is a worldwide statistical partnership to collect comparative price data and compile detailed
expenditure values of countries’ Gross Domestic Products (GDP), and to estimate Purchasing
Power Parities (PPPs) of the world’s economies.
 Using PPPs instead of market exchange rates to convert currencies makes it possible to compare
the output of economies and the welfare of their inhabitants in real terms (that is, controlling for
differences in price levels).

6. The Consumer Protection Act, 2019

Context:
The Consumer Protection Act, 2019 came into force on 20th July 2020.

Details:
 The law proposes a Central Consumer Protection Authority (CCPA) to regulate matters of
consumer rights, trade practices and advertisements prejudicial to the interests of the public, and
to promote, protect and enforce the rights of the consumers as a class.
 The proposed CCPA will be able to file Suo Motu cases on behalf of a class of customers,
thereby initiating class action suits that would hold brands and e-tailers accountable.
 State Commissions & District Commissions can now review their own orders.
 Reference to mediation by Consumer Commissions wherever scope for early settlement exists
and parties agree for it.
 No appeal against settlement through mediation.
 A manufacturer or product service provider or product seller to be responsible to compensate for
injury or damage caused by defective products or deficiency in services.

7. Agreement signed between GOI and World Bank

Context:
The World Bank and the Government of India signed a $750 million agreement for an Emergency
Response Programme for Micro, Small, and Medium Enterprises.

31 | VALUE ADDITION SERIES PART III: ECONOMY

Details:
 This project will support the Government in providing targeted guarantees to incentivize NBFCs
and banks to continue lending to viable MSMEs to help sustain them through the crisis.
 The World Bank Group, including its private sector arm – the International Finance Corporation
(IFC), will support the government’s initiatives to protect the MSME sector by strengthening
NBFCs and SFBs.
 Also, improving the funding capacity of key market-oriented channels of credit, such as the
NBFCs and Small Finance Bank (SFBs), will help them respond to the urgent and varied needs of
the MSMEs.

8. BharatMarket

 Confederation of All India Traders (CAIT) has announced to launch a national e-commerce
marketplace ‘BharatMarket’ for all retail traders in collaboration with several technology
partners.
 It will integrate the capabilities of various technology companies to provide end-to-end services
in the logistics and supply chains from manufacturers to end consumers, including deliveries at
home.
 This endeavour aims to bring 95% of retail traders onboard the platform, who will be the
shareholders and the portal will be run exclusively by the traders.

9. Chak-Hao (Black rice of Manipur) - GI tag

Context:
Chak-Hao i.e. the black rice of Manipur have been given the Geographical Indication (GI) tag.

Details:
 This rice has been cultivated in Manipur over many centuries and its basic characteristics are that
it has special aroma and is sticky in nature.
 It is basically consumed during community gatherings and feasts. It is normally served as Chak-
Hao kheer.
 One of the special features of this rice variety is that it is used in traditional medicine.
 Due to the presence of a fibrous bran layer and high crude fibre content, this rice takes some
more time to get cooked
 The traditional system of cultivating Chak-Hao is practised in some pockets of Manipur.
 Transplantation of rice seedlings raised in nurseries and direct sowing of pre-soaked seeds are
widely practised methods.

10. Green Bonds - issued by SBI on India INX’s Global Securities Market Platform

Context:
SBI has listed green bonds of USD 100 million on India INX’s Global Securities Market Green
Platform (GSM)

Details:
 SBI has adopted the green bond framework with an aim to create a positive impact on the
environment.
 This transaction is considered to be an important factor in having sustainable growth.
 The funds raised by these green bonds will be used to finance projects that do not discharge toxic
elements.
 Green Bond is a type of fixed income instrument that is reserved specifically for raising money to
climate & environmental projects so as to encourage sustainability.
 It acts as an attractive investment opportunity as it provides tax incentives such as tax exemption
and tax credits.

32 | VALUE ADDITION SERIES PART III: ECONOMY

11. GAFA tax

Context:
France, Spain, Italy and the U.K have proposed to impose GAFA tax on the largest digital firms. The
U.S. has slammed the moves as discriminating against its firms.

Details:
 GAFA tax is an acronym which is named after Google, Apple, Facebook, and Amazon.
 It is a proposed digital tax to be levied on large technology and internet companies.
 France has decided to introduce the tax i.e. a 3% tax on revenues from digital activities.
 European countries say that Google, Apple, Facebook and Amazon are exploiting tax rules and
depriving them of a fair share of their fiscal payments.
 Many countries agreed to negotiate a deal on how to tax tech multinationals.
 France, Britain, Italy and Spain call it a digital tax which is fair and just.

33 | VALUE ADDITION SERIES PART III: ECONOMY

 Congratulations to our toppers

04 Ranks in
Top 10 09 Ranks in
Top 20 13 Ranks in
Top 50 22 Ranks in
Top 100

RANK 03 RANK 06 RANK 08 RANK 10

Pratibha Verma Vishakha Yadav Abhishek Saraf Sanjita Mohapatra

Incredible results year after year!

Selected candidates from BYJU'S

2019
165 out of
2018 829 vacancies
183 out of
2017 812 vacancies
2016 236 out of
1058 vacancies
2015 215 out of
1209 vacancies
162 out of
2014 1164 vacancies

2013 82 out of
1364 vacancies
62 out of
1228 vacancies

To book a FREE COUNSELLING SESSION with our IAS Mentors call: 9241333666
Visit https://byjus.com/ias/ for more details

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Awards

VCCIRCLE
AWA R D S

Education Company Business Standard Google Play’s ‘Best Self Improvement’

Of The Year 2016, 2018 Start-up of the year 2017 App in India – 2016

Google Design Deloitte Technology Fast 50 India

Award 2018 and Fast 500 Asia Award Year
NASSCOM Design4India Design
Award 2018 for the ‘Best Design’
2012, 2013, 2014, 2015, 2016, Express IT Awards for IT newsmaker
Mobile Category – 2018
2017 of the year 2017