feature-image-CBM-in-CIL-2018
Current Affairs Analysis

12th April 2018 Current Affairs Analysis -IASToppers

Exploration from Coal India Ltd (CIL) blocks; SEBI amends norms for REITs and InvITs; Coal Bed Methane (CBM); Index of Economic Freedom; Partnership for Maternal, Newborn and Child Health (PMNCH) Delegation; 16th International Energy Forum (IEF) Ministerial Meeting; International Energy Forum (IEF); World Hindi Conference; 5G radio lab; MIMO technology; PSLV-C41; IRNSS-1I Navigation Satellite; MoU for Ratnagiri Mega Refinery; Exercise Gaganshakti-2018; dedicated defence and aerospace; small and medium enterprises (SME) fund; International Solar Alliance, etc.
By IT's Current Affairs Analysis Team
April 12, 2018

Contents

Economy

  • SEBI amends norms for REITs
  • Cabinet simplifies CBM exploration from CIL blocks
  • India ranks 130 in Index of Economic Freedom; up by 13 spots

Bilateral & International Relations

  • PMNCH Delegation calls on the Prime Minister
  • India hosts 16th International Energy Forum (IEF) Ministerial Meeting

Art & Culture

  • 11th World Hindi Conference

Science & Technology

  • IIT-Delhi launches first 5G radio lab
  • PSLV-C41 Successfully Launches IRNSS-1I Navigation Satellite

Key Facts for Prelims

  • Indian Consortium and Saudi Aramco Sign MoU for Ratnagiri Mega Refinery
  • Exercise Gaganshakti-2018
  • India’s first dedicated defence and aerospace SME fund
  • Headquarters Agreement between India and the International Solar Alliance

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Economy

SEBI amends norms for REITs

SEBI has amended REITs and InvITs regulations to facilitate the growth of such trusts.

  • As per the amendments, REITs and InvITs will now have to provide a mechanism for resolution of disputes with their shareholders and partners in the holding firm.

REITs-2018

What are REITs?

  • REITs are similar to mutual funds. While mutual funds provide for an opportunity to invest in equity stocks, REITs allow one to invest in income-generating real estate assets.

How does an REIT work?

  • REITs raise funds from a large number of investors and directly invest that sum in income-generating real estate properties (which could be offices, residential apartments, shopping centres, hotels and warehouses).
  • The trusts are listed in stock exchanges so that investors can buy units in the trust. REITs are structured as trusts. Thus, the assets of an REIT are held by an independent trustee on behalf of unit holders.

An REIT’s investment objective:

  • The investment objective of REITs is to provide unit holders with dividends, usually generated from rental income and capital gains from the profitable sale of real estate assets.
  • Typically, the trust distributes 90 per cent of its income among its investors by issuing dividends.

REITs in India?

REITs, as a concept, have been on the horizon for a while now.

  • India’s regulations in 2014 for the sector have not been able to attract investor interest.
  • REITs obtained exemption from dividend distribution tax in the Budget, a step towards making them attractive for the investors.

The current SEBI guidelines for REITs permit investments only in rent-yielding assets.

Why invest in REITs?

  • For investors who are averse to investing in physical purchase of property due to the risks involved, REIT is an alternative.
  • Investors purchase units of REITs which are traded on the stock exchange, as against physical purchase of property. Therefore, investors can buy and sell units of REIT on the stock exchange as and when required, making investment easier to liquidate compared to physical property transaction.

Potential investment risks:

  • REITs units are listed on, and are subject to the vagaries of the stock exchanges, resulting in negative or lower returns than expected.
  • As in mutual funds, retail investors in REITs have no control over investments and exits being made by the trust.

What is InvITs?

An Infrastructure Investment Trust (InvITs) is like a mutual fund, which enables direct investment of small amounts of money from possible individual/institutional investors in infrastructure to earn a small portion of the income as return.

  • SEBI notified the SEBI (Infrastructure Investment Trusts) Regulations, 2014 on September 26, 2014, providing for registration and regulation of InvITs in India.
  • The objective of InvITs is to facilitate investment in the infrastructure sector.
  • InvITS are like mutual funds in structure. InvITs can be established as a trust and registered with SEBI. An InvIT consists of four elements:
  1. Trustee,
  2. Sponsor(s),
  3. Investment Manager and
  4. Project Manager.
  • InvITs work like mutual funds or real estate investment trusts (REITs) in features.
  • InvITs can be treated as the modified version of REITs designed to suit the specific circumstances of the infrastructure sector.
[Ref: Times of India] 

 

Cabinet simplifies CBM exploration from CIL blocks

The Cabinet Committee on Economic Affairs (CCEA) has relaxed rules for state-owned Coal India Ltd (CIL) for extraction of Coal Bed Methane (CBM) lying below coal seams in its blocks in bid to quickly boost production.  

  • Till now, CIL had to apply to oil ministry for a licence to extract coal-bed methane (CBM) from its coal blocks.

CBM-in-CIL-2018

Significance of the move:

  • It will expedite the exploration and exploitation of CBM, enhance availability of natural gas and reduce gap in demand and supply of natural gas.
  • The increased development activities for exploration and exploitation of CBM gas reserves will generate economic activities, thus create employment opportunities.

What is Coal Bed Methane?

coal-bed-methane

  • Coal Bed Methane is a form of natural gas extracted from coal beds.
  • The term CBD refers to methane adsorbed into the solid matrix of the coal.
  • It is an important source of energy in United States, Canada, Australia, and other countries.
  • CBD is distinct from typical sandstone or other conventional gas reservoir, as the methane is stored within the coal by a process called adsorption.
  • It contains very little heavier hydrocarbons such as propane or butane, and no natural-gas condensate.
  • During the initial years of mining, CBM was vented out and wasted into the atmosphere as it was considered as serious safety hazard while conducting coal mining operations. However, later with advancement of technology it was possible to extract CBM, a precious energy resource and an unconventional form of natural gas.

Advantages of CBM as a fuel:

  • It is environmentally safe and clean fuel which on combustion emits only carbon dioxide and water.
  • It is not only considered as an efficient fuel but also reduces emission of greenhouse gas from coal mining.
  • Its extraction prior to coal mining activities makes mining activities safer by degassing the coal seams.
[Ref: Economic Times] 

 

India ranks 130 in Index of Economic Freedom; up by 13 spots

India ranked 130th out of 186 economies in recently released Index of Economic Freedom 2018 that measures the degree of economic freedom in the countries of the world.

About the index:

  • Index of Economic Freedom report is released by the Heritage Foundation. The Heritage Foundation is an American conservative public policy think-tank based in Washington.

Criterion:

Economic freedom is measured based on 12 quantitative and qualitative factors, grouped into four broad categories, or pillars, of economic freedom:

  1. Rule of Law (property rights, government integrity, judicial effectiveness).
  2. Government Size (government spending, tax burden, fiscal health).
  3. Regulatory Efficiency (business freedom, labor freedom, monetary freedom).
  4. Open Markets (trade freedom, investment freedom, financial freedom).

Each of the ten economic freedoms within these categories is graded on a scale of 0 to 100. A country’s overall score is derived by averaging these ten economic freedoms, with equal weight being given to each.

What is economic freedom?

  • Economic freedom is the fundamental right of every human to control his or her own labor and property.
  • In an economically free society, individuals are free to work, produce, consume, and invest in any way they please.
  • In economically free societies, governments allow labor, capital, and goods to move freely, and refrain from coercion or constraint of liberty beyond the extent necessary to protect and maintain liberty itself.

Benefits of economic freedom:

  • Economic freedom brings greater prosperity. The Index of Economic Freedom documents the positive relationship between economic freedom and a variety of positive social and economic goals.
  • The ideals of economic freedom are strongly associated with healthier societies, cleaner environments, greater per capita wealth, human development, democracy, and poverty elimination.

Highlights of the report:

  • Top 10 countries are Hong Kong, Singapore, New Zealand, Switzerland, Australia, Ireland, Estonia, United Kingdom, Canada and UAE.
  • China is ranked 111 and Pakistan is now at 131 position.

India’s performance:

  • India’s economic freedom score is 54.5, making its economy the 130th freest in the 2018 Index. In 2017, India with a score of 52.6 points was ranked at 143 among 180 countries.
  • India is ranked 30th among 43 countries in the Asia-Pacific region, and its overall score is below the regional and world averages.
  • India is developing into an open-market economy. However, traces of its past autocratic policies still remain.
  • Economic liberalisation measures, including industrial deregulation, privatisation of state-owned enterprises and reduced controls on foreign trade and investment, that began in the early 1990s, accelerated growth.

More recently, the government reformed one of its more opaque operational practices to make the auctioning of rights to exploit state-owned resources more transparent.

Challenges:

  • Corruption, underdeveloped infrastructure, a restrictive and burdensome regulatory environment, and poor financial and budget management continue to undermine overall development.
  • The judiciary is independent, but the Indian courts are understaffed and lack the technology necessary to clear an enormous backlog. Although officials are often caught accepting bribes, a great deal of corruption goes unnoticed and unpunished.
  • Non-tariff barriers significantly impede trade. The government’s openness to foreign investment is below average. State-owned institutions dominate the financial sector, and foreign participation is limited. In public-sector banks, troubled assets account for about 10% of total assets.
[Ref: The Hindu]

 

Bilateral & International Relations 

PMNCH Delegation calls on the Prime Minister

Partnership for Maternal, Newborn and Child Health (PMNCH) Delegation recently called on the Prime Minister and presented the logo for the 2018 Partners’ Forum.

About PMNCH Delegation:

  • The Partnership for Maternal, Newborn & Child Health (The Partnership, PMNCH) is an alliance of more than 1000 organizations in 77 countries from the sexual, reproductive, maternal, newborn, child and adolescent health communities, as well as health influencing sectors.
  • The Partnership is governed by a Board, and administered by a Secretariat hosted at the World Health Organization in Geneva, Switzerland.
  • The Partnership provides a platform for organizations to align objectives, strategies and resources, and agree on interventions to improve maternal, newborn, child and adolescent health.
  • The Partnership’s role complements the work and accountability processes of its individual members, enabling them to deliver more collectively than they would alone.
  • This Partner-centric approach mobilizes, engages and empowers different implementing partners. It allows them to coordinate their actions and activities, and encourages and promotes mutual accountability.
[Ref: PIB]

 

India hosts 16th International Energy Forum (IEF) Ministerial Meeting

India, world’s third-largest energy consumer after US and China hosted 16th International Energy Forum (IEF) Ministerial Meeting in New Delhi.

Key facts:

  • This is second time India hosting IEF Ministerial meeting. It had earlier hosted 5th IEF Ministerial in 1996 at Goa.
  • The theme of 2018 IEF Ministerial Meeting was “The Future of Global Energy Security: Transition, Technology, Trade and Investment”.
  • It was attended by Petroleum Ministers from 42 countries and was co-hosted by China and South Korea.

IEF

About International Energy Forum (IEF):

The International Energy Forum (IEF) is the world’s largest recurring gathering of energy ministers.

IEF-.

  • It is unique in that participants not only include IEA and OPEC countries, but also key international actors such as Brazil, China, India, Mexico, Russia, and South Africa. 18 of the G20 countries are members of IEF.
  • It serves as a neutral facilitator of informal, open, informed and continuing global energy dialogue among its members comprising of energy producing and energy consuming states, including transit countries.
  • There are 72 member countries of IEF, including India, covering all six continents, which are signatories to the Charter of the IEF.
  • The IEF countries account for more than 90 percent of global oil and gas supply and demand.
  • The IEF is promoted by a permanent Secretariat based in the Diplomatic Quarter of Riyadh, Saudi Arabia.
  • The Forum’s biennial Ministerial Meetings are the world’s largest gathering of Energy Ministers.
  • This is the only organization where there are no entry barriers for any country to join.

IEF’s Executive Board (EB):

  • IEF’s Executive Board (EB) was set up in 2002 and comprises of 31 designated representatives of Ministers of the member states. It meets twice a year.
  • International Energy Agency (IEA) and Organisation of the Petroleum Exporting Countries (OPEC) are non-voting members of the Executive Board.
  • The EB is chaired by the Host State of the next biennial Ministerial Meeting. India is currently Chair of IEF’s Executive Board.
  • By virtue of being among the top 11 largest consumers of oil and gas (India is presently 4th), India has been the Permanent Member of the Executive Board since its set-up in 2002.
  • India had earlier hosted the 5th IEF Ministerial in 1996 at Goa.
[Ref: PIB]

 

Art & Culture 

11th World Hindi Conference

The 11th World Hindi Conference (WHC) is being organized in August 2018 in Mauritius by the Ministry of External Affairs, Government of India in association with the Government of Mauritius.

About the 11th World Hindi Conference:

  • The event, held once in three years, is dedicated to Hindi language.
  • The conference provides common platform to several Hindi scholars, writers and laureates from different parts of the world to contribute the language.
  • The theme of the Conference is “Vaishvik Hindi Aur Bharatiy Sanskriti”.

world-hindi-conference-2018

About the World Hindi Conference:

  • The decision to organize the 11th edition of the Conference in Mauritius was taken at the 10th World Hindi Conference held in Bhopal, India in September 2015.
  • The first World Hindi Conference was held in 1975 in Nagpur, India. Since then, ten such Conferences have been held in different parts of the world.
  • The MEA has also set up the World Hindi Secretariat in Mauritius. The main objective of the WHS is to promote Hindi as an international language and further its cause for recognition at the United Nations as an Official Language.

 [Ref: The Hindu]

 

Science & Technology 

IIT-Delhi launches first 5G radio lab

In an effort to establish India as a key global player in the standardisation, research and development and manufacturing of 5G equipment, a Massive MIMO radio laboratory has been set up at IIT Delhi.

  • It will be the first of its kind 5G lab in the country and has been set-up at Bharti School of Telecommunication Technology and Management.

5g-radio-lab-2018

What is MIMO Technology?

  • Multiple-input multiple-output, or MIMO, is a radio communications technology or RF technology that is being mentioned and used in many new technologies these days.
  • Wi-Fi, LTE; Long Term Evolution, and many other radio, wireless and RF technologies are using the new MIMO wireless technology to provide increased link capacity and spectral efficiency combined with improved link reliability using what were previously seen as interference paths.
  • MIMO technology uses a natural radio-wave phenomenon called multipath. With multipath, transmitted information bounces off walls, ceilings, and other objects, reaching the receiving antenna multiple times at different angles and slightly different times.
  • In the past, multipath caused interference and slowed down wireless signals. With multipath, MIMO technology uses multiple, smart transmitters and receivers with an added spatial dimension, increasing performance and range.

Significance of MIMO technology:

  • In Massive MIMO technology, several antennas are deployed at the base station as compared to only a few antennas in 3G/4G. This large antenna array at the base station allows the network to communicate reliably with a very large number of mobile terminals simultaneously at the same time and on the same frequency channel.
  • It will help curb the emittance of radiation harmful to our health and also will allow less radio interference for better communication.

What is 5G?

  • 5G is wireless communication technology based on third-generation partnership project (3GPP).
  • It is next generation mobile networks technology after 4G LTE networks.
  • It is expected to offer enhanced mobile broadband (eMBB) through R15 repeaters that can cater to coverage requirements.
  • The 5G wireless technology will offer far greater upload and download speed i.e. 100 times faster internet data speed than current 4G networks.
  • It has potential to demonstrates spectral efficiency and potential for diversified services such as Internet of Things (IoT) and augmented reality (AR)/virtual reality (VR).
[Ref: The Hindu]

 

PSLV-C41 Successfully Launches IRNSS-1I Navigation Satellite

The Indian Space Research Organisation (ISRO) has launched the IRNSS-1I satellite through its PSLV-C41.

  • It was the 20th flight of PSLV-XL version.
  • This satellite will transmit signals for the accurate determination of position, navigation and time.
  • Like all other IRNSS satellites, IRNSS-1I will also carry two payloads – navigation payload and ranging payload – the former to transmit signals for determining position, velocity and time and the latter for determining the frequency range of the satellite.

IRNSS-INDIA-SUCCESSFULLY-LAUNCHES-5TH-SATELLITE-FOR-ITS-NAVIGATION-SYSTEM-2018

Background:

  • Navigation satellite IRNSS-1I has been launched to replace India’s first navigation satellite IRNSS-1A, whose three Rubidium atomic clocks had stopped working two years ago.
  • The malfunctioning of the Europe-imported atomic clocks in IRNSS-1A made it difficult to measure precise locational data from the satellite. When the time signal is missing, getting true positional accuracy becomes a problem. Therefore, Isro felt a need to replace faulty satellite IRNSS-1A.

About IRNSS:

  • The Indian Regional Navigation Satellite System (IRNSS) is an independent satellite based regional system developed indigenously by India on par with US-based GPS, Russia’s Glonass and Galileo developed by Europe. It was renamed “Navic” (Navigation with Indian Constellation).
  • The NAVIC system is constellation of seven satellites, (namely IRNSS-1I, 1B, 1C, 1D, 1E, 1F and 1G) of which three are geostationary and four are non-geostationary. It provides location tracking within 20 meters of actual positions, especially in 1,500 km area around the country’s borders. The indigenous satellite-based navigation system under one’s control and command is considered a deep strategic asset.
  • The NAVIC navigation system has both civilian and military uses. Moreover, it helps not just in land navigation but also in marine and aerial navigation. It offers wide services like terrestrial and marine navigation, disaster management, vehicle tracking and fleet management visual and voice navigation for drivers.

IRNSS-INDIA-SUCCESSFULLY-LAUNCHES-5TH-SATELLITE-FOR-ITS-NAVIGATION-SYSTEM-2018

Background:

  • The need for indigenous navigation system on par with GPS was felt soon after Kargil conflict (1999), when India desperately needed services osatellite-based navigation system, but did not have one of its own. The US system was not available at the time.
  • Only US (named GPS) and Russia (Glosnass) currently have fully operational GPS systems at present. China (Beidou) and Europe (Galileo) are still in process of deploying their full systems. Japan is also planning a similar project with three of its own satellites. Japan’s system will be called the QZSS.

 

Key Facts for Prelims

Indian Consortium and Saudi Aramco Sign MoU for Ratnagiri Mega Refinery

  • An Indian Consortium consisting of IOCL, BPCL and HPCL and Saudi Aramco signed a Memorandum of Understanding (MoU) to jointly develop and build an integrated refinery and petrochemicals complex, Ratnagiri Refinery & Petrochemicals Ltd. (RRPCL) in the State of Maharashtra.
  • The strategic partnership brings together crude supply, resources, technologies, experience and expertise of these multiple oil companies with an established commercial presence around the world.

 

Exercise Gaganshakti-2018

  • It is an all-encompassing coordinated and composite exercise which is being conducted by the IAF.
  • The aim of this exercise is real time coordination, deployment and employment of Air Power in a short & intense battle scenario.
  • This exercise will hone the war fighting skills of the air warriors in a real time scenario thus affirming the IAF’s role as the cutting edge of our nation’s military capability.

 

India’s first dedicated defence and aerospace SME fund

  • Department of Defence Production has announced the creation of a dedicated defence and aerospace small and medium enterprises (SME) fund.
  • The fund will be registered with the Securities and Exchange Board of India (SEBI), where a minority stake could be taken by investors.
  • This fund would help channelise investments into the two defence corridors announced by the Government in Tamil Nadu and Uttar Pradesh.

 

Headquarters Agreement between India and the International Solar Alliance

  • The Union Cabinet has given its ex-post facto approval for entering into Headquarters (Host country) Agreement between India and the International Solar Alliance (ISA) and authorizing the Ministry of External Affairs for signing the Headquarter Agreement.
  • The Headquarters Agreement will institutionalize the functional arrangements between India and ISA.
  • It will help in smooth transition of ISA as international inter-governmental organization.

Creation of ISA will lead to accelerated solar technology development and deployment in ISA member countries including India.

 

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