Current Affairs Analysis

16th January 2020 Current Affairs Analysis – IASToppers

Henley Passport Index 2020; Global Health Challenges; What is Fiscal Deficit? What is Off-Budget financing? Women Business and the Law (WBL) 2020 Index; Women, Business and Law (WBL) index; What is HS code? What is Saksham 2020? Petroleum Conservation Research Association (PCRA); Central Adoption Resource Authority (CARA); Open Acreage Licensing Policy (OALP); National Data Repository (NDR); Hydrocarbon Exploration & Licensing Policy (HELP); Light Combat Aircraft (LCA)-Mk1 Tejas; etc.
By IASToppers
January 27, 2020

Contents

Government Schemes & Policies

  • Petroleum Ministry launches Saksham 2020 for fuel conservation
  • Fifth Oil and Gas block bid round

Issues related to Health & Education

  • Global Health Challenges released by the World Health Organisation
  • Central Adoption Resource Authority celebrates 5th Annual Day

Social Issues

  • India ranked 117th on Women Business and the Law (WBL) 2020 Index

Economy

  • The actual fiscal deficit is higher than 1 % point
  • Khadi gets HS code

Bilateral & International Relations

  • Henley Passport Index

Defence & Security Issues

  • Light Combat Aircraft

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Government Schemes & Policies

Petroleum Ministry launches Saksham 2020 for fuel conservation

The month long fuel conservation campaign of Petroleum Conservation Research Association (PCRA), Saksham 2020, was launched by Petroleum Ministry on January 16.

a people centric fuel conservation mega campaign

What is Saksham 2020?

  • This is a flagship program of PCRA and Oil public sector undertakings under the guidance of the Ministry of Petroleum and Natural Gas.
  • The initiative aims to add values to the various efforts being made in the country for saving fuel.
  • It will be a month long i.e. from 16 January to 15 February, mega campaign.
  • PCRA and Oil & Gas companies shall carry out various interactive programs during this month-long campaign.

Petroleum Conservation Research Association (PCRA)

  • It is a registered society set up under the aegis of Ministry of Petroleum & Natural Gas, Government of India.

Petroleum Conservation Research Association (PCRA).

  • PCRA is a national government agency engaged in promoting fuel conservation and energy efficiency in various sectors of the economy.
  • It also helps the government in formulating policies and strategies for petroleum conservation, aimed at reducing excessive dependence of the country on oil imports.
  • PCRA conducts energy efficiency studies in the industrial sector which include energy audits, fuel oil utilization studies, model depot projects, small scale industrial studies, institutional training programs, PAT consultancy, ISO 50001 EnMS implementation assistance, seminars and exhibitions. 
  • PCRA is actively engaged in formulating energy efficiency standards for equipment consuming petroleum fuel.
[Ref: Vikaspedia, PIB]

 

Fifth Oil and Gas block bid round

Government has launched the Fifth Oil and Gas block bid round under the Hydrocarbon Exploration & Licensing Policy.

Fifth Oil and Gas block bid round

  • Up till 25th January 2020, the government has awarded 94 blocks under (HELP) regime. These 94 blocks cover an exploratory area of about 1,36,800 square kilometres over 16 Indian Sedimentary Basins.
  • The bids are awarded based on the provisions of the Open Acreage Licensing Policy.

Open Acreage Licensing Policy (OALP)

·         Open Acreage Licensing Policy (OALP), a part of the government’s Hydrocarbon Exploration and Licensing Policy (HELP), gives an option to a company looking for exploring hydrocarbons to select the exploration blocks on its own, without waiting for the formal bid round from the Government.

OPEN ACREAGE LICENSING POLICY (OALP)

·         Companies can put in an expression of interest (EoI) for any area throughout the year. The areas sought are then put on auction.

·         The objective of OLAP is to increase India’s indigenous oil and gas production by maximising the potential of already discovered hydrocarbon resources in the country.

·         OALP offers single license to explore conventional and unconventional oil and gas resources to propel investment in and provide operational flexibility to the investors.

·         Under it, Government will conduct auction of oil and gas blocks twice a year, with the first round being held in July 2017.

·         The selection of oil blocks will be based on seismic and well data provided by Directorate-General of Hydrocarbons in National Data Repository.

National Data Repository (NDR)

  • National Data Repository (NDR) is an integrated data repository of Exploration and Production (E&P) data of Indian sedimentary basins.

NATIONAL-DATA-REPOSITORY-(NDR)

  • NDR is hosted at Directorate General of Hydrocarbons (DGH) under the Ministry of Petroleum and Natural Gas (MoPNG).
  • NDR offers a unique platform to all E&P Operators, E&P Service Companies, E&P Investors, Academia to delve inside diverse E&P datasets of Indian sedimentary basins.

Salient Features of NDR:

  • Wholly funded by Govt. of India.
  • Ability to store data online, near line and offline.
  • Independent web based access.
  • Tracking and delivery of data order via internet.
  • Data entitlement and data trading.
  • To support open acreages policy.
  • NDR site as an extension and disaster recovery.

Vision of NDR:

Integration of following data in NDR in the future:

  • Gas Hydrate
  • Oil Shale
  • Shale Gas
  • Geological Data from GSI
  • Coal in reference to CBM
  • Environmental data

Objectives of NDR are:

  • To validate, store, maintain and reproduce reliable G&G data Reliable E&P data with provisions for seamless access online and offline.
  • Data exchange and trading among existing players to improve DGH ability to monitor and control E&P activities.
  • To support open acreage globally E&P business environment.
  • To provide data for processing, interpretation and visualization.
  • To strengthen overall Geo-scientific activities in India.

Hydrocarbon Exploration & Licensing Policy (HELP)

The Hydrocarbon Exploration & Licensing Policy (HELP) opens up India’ entire sedimentary basin for investment from domestic and foreign players under a simplified, transparent and investor-friendly fiscal and administrative regime. The policy replaces the New Exploration Licensing Policy. 

Four main elements of HELP:

  • Uniform license for exploration and production of all forms of hydrocarbon.
  • An open acreage policy.
  • Revenue Sharing Model
  • Marketing and pricing freedom for the crude oil and natural gas produced.

Objectives of HELP:

  • Enhance domestic oil and gas production
  • Bring substantial investment
  • Generate sizable employment
  • Enhance transparency and
  • Reduce administrative discretion

HELP

HELP 1

[Ref: Financial Express, The Indian Express, The Hindu]

 

Issues related to Health & Education

Global Health Challenges released by the World Health Organisation

The World Health Organisation has released top 13 urgent health challenges facing the world over the next decade.

World Health Organization (WHO) has released a list of 13 urgent global health challenges.

  • According to WHO, countries invest heavily in protecting their people from terrorist attacks, but not against the attack of a virus, which could be far more deadly, and far more damaging economically and socially. A pandemic could bring economies and nations to their knees.

The challenges are:

a list of 13 urgent global health challenges.

  1. Elevating health in the climate debate:
  • The world’s climate crisis has major health implications, with air pollution alone killing an estimated seven million people annually, while it causes more extreme weather events, exacerbates malnutrition and fuels the spread of infectious diseases such as malaria.
  1. Delivering health in conflict and crisis
  • In 2019, most disease outbreaks requiring the highest level of WHO response occurred in countries with protracted conflict.
  • There is continuation of a disturbing trend in which health workers and facilities are targeted.
  1. Making health care fairer
  • Persistent and growing socio-economic gaps result in major discrepancies in the quality of people’s health. There is an 18-year difference between the life expectancy of people in low- and high-income countries, as well as significant differences in life expectancies among people living within the same countries and cities.
  1. Expanding access to medicines
  • About one-third of the world’s people lack access to medicines, vaccines, diagnostic tools and other essential health products. Limited access to these products fuel drug resistance and threaten people’s lives and health.
  1. Stopping infectious diseases
  • Infectious diseases like HIV, tuberculosis, viral hepatitis, malaria, neglected tropical diseases and sexually-transmitted infections will kill an estimated 4 million people in 2020, most of them poor.
  1. Preparing for epidemics
  • An airborne and highly infectious virus pandemic is inevitable. The countries around the world continue to spend more on responding to these emergencies than preparing for them.
  • This leaves countries unprepared for when another pandemic strikes and potentially threatens the lives of millions of people.
  1. Protecting people from dangerous products
  • Nearly one-third of today’s global disease burden is attributed to a lack of food, unsafe food, and unhealthy diets.
  • Further, there’s been an increase in tobacco and e-cigarette use in most countries, raising additional health concerns.
  1. Underinvestment in Health Workers
  • Chronic under-investment in the education and employment of health workers, coupled with a failure to ensure decent pay, has led to health worker shortages all over the world. This jeopardizes health and social care services and sustainable health systems.
  • An additional 18 million health workers, including nine million nurses and midwives, will be needed across the world by 2030.

 

  1. Keeping adolescents’ safe
  • More than 1 million adolescents aged 10-19 years die every year due to road injury, HIV, suicide, lower respiratory infections, and interpersonal violence.
  • A number of factors including harmful alcohol use, unprotected sex, and lack of physical activity, increase the risks of these types of death.
  1. Earning public trust
  • Public health is compromised by the uncontrolled dissemination of misinformation in social media, as well as through an erosion of trust in public institutions.
  1. Harnessing new technologies
  • Genome editing, synthetic biology and digital health technologies such as artificial intelligence can solve many problems, but also raise new questions and challenges for monitoring and regulation.
  • Without a deeper understanding of their ethical and social implications, these new technologies could harm the people they are intended to help.
  1. Protecting the medicines that protect us
  • Anti-microbial resistance (AMR) has the potential to undo decades of medical advancements and has increased due to a number of factors, including limited access to quality and low-cost medications, unregulated prescription and use of antibiotics and poor infection prevention control.
  1. Keeping health care clean
  • Roughly one in four health facilities globally lack basic water services. The lack of these basics in health facilities leads to poor-quality care and an increased chance of infection for patients and health workers.

All the challenges in the above list demand support from all the relevant sectors and not the health sector alone. Governments, communities, and international agencies must work together to achieve these critical goals. 

[Ref: The Hindu, WHO]

 

Central Adoption Resource Authority celebrates 5th Annual Day

Central Adoption Resource Authority (CARA) celebrated its 5th Annual Day in New Delhi and as part of the Advocacy, souvenirs to commemorate the Annual Day was unveiled during the event.

Central Adoption Resource Authority (CARA)

About CARA:

  • CARA is an autonomous and statutory body of Ministry of Women & Child Development established under Juvenile Justice (Care and Protection of Children) Act, 2015.
  • It was set up in 1990.
  • It is a nodal body for adoption of Indian children.
  • It is mandated to monitor and regulate in-country and inter-country adoptions.
  • CARA primarily deals with adoption of orphan, abandoned and surrendered children through its associated /recognised adoption agencies.
  • It deals with inter-country adoptions according to Hague Convention on Inter-country Adoption, 1993 ratified by India in 2003.
  • In 2018, CARA has allowed individuals in a live-in relationship to adopt children from and within India.
[Ref: PIB, CARA]

 

Social Issues

India ranked 117th on Women Business and the Law (WBL) 2020 Index

India placed 117th among 190 countries on the Women Business and the Law (WBL) 2020 Index to measure economic empowerment of women, released by World Bank on January 14, 2020.

Women, Business and the Law 2020 4

Highlights of the Index

  • India gained 4% year-on-year on its score on the World Bank study of women, business and law (WBL) 2020 and scored 74.4 on out of 100, a par with Benin and Gambia but way below least developed countries like Rwanda and Lesotho.

Women, Business and the Law 2020 4

  • India overtook Maldives to command the highest WBL score in the South Asian region in 2020.
  • Among the BRICS countries India’s score is only second to the last. With a score of 88.1 points, South Africa tops the WBL index, followed by Brazil at 81.9 points. Even as China scored 1.2 points higher than India in the WBL index, its absolute score dropped marginally over the previous year.
  • The global average was 75.2 which is a slight increase from 73.9 in the previous index released in 2017.
  • The study tracked “how laws affect women at different stages in their working lives and focusing on those laws applicable in the main business city”.
  • The Index is based on the countries’ formal laws and regulations that have a bearing on women’s economic participation, covering eight areas (eg. parenthood, equality of pay). A survey was conducted between June 2017 and September 2019.
  • Only eight economies scored a perfect 100 — Belgium, Canada, Denmark, France, Iceland, Latvia, Luxembourg, and Sweden. 
  • The study finds that over time, reforms increasing women’s equality of opportunity contribute to more successful economies, higher female labour force participation and better development outcomes.

About the Women, Business and Law (WBL) index:

  • WBL is a World Bank Group project collecting unique data on the laws and regulations that restrict women’s economic opportunities.
  • The World Bank study analyses laws and regulations affecting women’s economic opportunity in 190 economies across the eight indicators – mobility, workplace, pay, marriage, parenthood, entrepreneurship, assets and pension.

Women, Business and the Law 2020 1

  • It is committed to informing research and policy discussions about the state of women’s economic opportunities and empowerment.
  • Women, Business and the Law 2020 is the sixth in a series of studies that analyze laws and regulations affecting women’s economic opportunity in 190 economies. It tracks how the law affects women at various stages in their lives, from the basics of transportation to the challenges of starting a job and getting a pension.
  • The indicators are used to build evidence of the relationship between legal gender equality and women’s entrepreneurship and employment.

index

[Ref: Indian Express, Economic Times]

 

Economy

The actual fiscal deficit is higher than 1 % point

According to a blog by the former Economic Affairs secretary, the true fiscal deficit for 2018-19 is 4.7%. i.e. one full percentage point higher than the official data.

fiscal deficit

What’s the issue?

  • Contrary to these views, the Indian government says, the fiscal deficit just 3.4 per cent of the gross domestic product (GDP) for 2018-19. For the current year, the Union Budget presented in July expected the fiscal deficit to be 3.3 per cent of the GDP.

fiscal deficit 1

  • For long, it has been suspected that the official figures hide the true fiscal deficit. That’s because some of the government’s expenditure was funded by the so-called “off-budget” items.
  • As a result, while this extra expenditure did not figure in the official calculations, it did mean that the true fiscal deficit or borrowing by the public sector was higher than the level presented in the Budget.

How does the government earn and spend?

  • Sources of revenue for the government can be classified into revenue receipts and non-tax revenues.
  • Revenue receipts of the government include Corporation Tax, Income Tax, Custom Duties, Union Excise Duties, GST and taxes of Union territories.
  • Non-tax revenues include Interest Receipts, Dividends and Profits, External Grants, Other non-tax revenues and Receipts of union territories
  • Expenditure includes Revenue Expenditure, Capital Expenditure, Interest Payments and Grants-in-Aid.

What is Fiscal Deficit?

  • The difference between total revenue and total expenditure of the government is termed as fiscal deficit. It is reflective of the total borrowing requirements of Government.

What is fiscal deficit

  • Generally, fiscal deficit takes place either due to revenue deficit or a major hike in capital expenditure.
  • If the fiscal deficit ratio is too high, it implies that there is a lesser amount of money left in the market for private entrepreneurs and businesses to borrow.
  • Lesser amount of this money, in turn, leads to higher rates of interest charged on such lending. So, simply put, a higher fiscal deficit means higher borrowing by the government, which, in turn, mean higher interest rates in the economy.
  • In India, the Fiscal Responsibility and Budget Management Act, 2003 requires the government to limit the fiscal deficit to 3% of the GDP by 31 March 2021 and the debt of the central government to 40% of the GDP by 2024-25, among others.

Benefits of Fiscal Deficit?

  • Additional financial resources can be used for the creation of productive assets like highways, roads, ports and airports thus boosting economic growth and employment.

Concerns of Fiscal Deficit:

  • A lesser amount of money is left in the market for private entrepreneurs and businesses to borrow.
  • Also results in higher interest rates in the economy.

How do Governments finance fiscal deficits?

  • Governments typically finance their deficit by borrowings. Banks, public institutions, public and overseas investors are the main channels.

What is the acceptable level of fiscal deficit?

  • There is no set universal level of fiscal deficit that is considered good.
  • Typically, for a developing economy, where private enterprises may be weak and governments may be in a better state to invest, fiscal deficit could be higher than in a developed economy.
  • Here, governments also have to invest in both social and physical infrastructure upfront without having adequate avenues for raising revenues.

What should the ideal fiscal deficit look like?

  • In India, the FRBM Act suggests bringing the fiscal deficit down to about 3 percent of the GDP is the ideal target. Unfortunately, successive governments have not been able to achieve this target.

 What is Off-Budget financing?

What is off- budget financing

  • Off Budget financing means expenditure that’s not funded through the budget. It is also not taken into account when calculating fiscal indicators.
  • Issues:
    • It tends to hide the actual extent of government spending, borrowings and debt.
    • Increases the interest burden.
    • Entails fiscal risk if it is backed by a government guarantee.  
    • Reduced parliamentary control as it remains outside the budget.

 Examples:

  • Deferred fertilizer arrears/bills through special banking arrangements.
    Food subsidy bills/arrears of Food Corp. of India through borrowings.
  • Accelerated Irrigation Benefit Program through National Bank for Agriculture and Rural Development borrowing.
  • Indian Railway Finance Corp. borrowing for railway projects.
[Ref: Economic Times, The Indian Express, Livemint]

 

Khadi gets HS code

The Ministry of Commerce and Industry allocated a separate Harmonised System (HS) code for Khadi.

India not to allow imports without HSN code

What is HS code?

  • The Harmonised System, or simply ‘HS’, is a six-digit identification code developed by the World Customs Organization (WCO).

World Customs Organization (WCO)

  • Of the six digits, the first two denote the HS Chapter, the next two give the HS heading, and the last two give the HS subheading.
  • For example, The HS code for pineapple is 0804.30, which means it belongs to Chapter 08 (Edible fruit & nuts, peel of citrus/melons), Heading 04 (Dates, figs, pineapples, avocados, etc. fresh or dried), and Subheading 30 (Pineapples).

What-does-the-HS-code-mean-1

  • It is called the “universal economic language” for goods and is a multipurpose international product nomenclature.
  • HSN is in use worldwide, with 200+ countries participating. Nearly 98% of international trade stock is classified in terms of HSN.

Application:

  • HSN classification is widely used for taxation purposes by helping to identify the rate of tax applicable to a specific product in a country that is under review. It can also be used in calculations that involve claiming benefits.

HS code are used by Customs authorities, statistical agencies, and other government regulatory bodies, to monitor and control the import and export of commodities through:

  1. Customs tariffs
  2. Collection of international trade statistics
  3. Rules of origin
  4. Collection of internal taxes
  5. Trade negotiations (e.g., the World Trade Organization schedules of tariff concessions)
  6. Transport tariffs and statistics
  7. Monitoring of controlled goods (e.g., wastes, narcotics, chemical weapons, ozone layer depleting substances, endangered species, wildlife trade)
  8. Areas of Customs controls and procedures, including risk assessment, information technology and compliance.

Significance:

  • The system helps in harmonising of customs and trade procedures, thus reducing costs in international trade.
  • The system currently comprises of around 5,000 commodity groups, each identified by a unique six-digit code that has numbers arranged in a legal and logical structure with well-defined rules to achieve uniform classification.

HSN in India

  • India has been a member of the WCO (World Customs Organization) since 1971.
  • It initially employed six-digit HSN codes to classify merchandise for Customs as well as Central Excise duties.
  • To make the codes more precise, the Customs and Central Excise authorities went on to add two more digits. This resulted in an eight-digit HSN classification.
  • Almost all goods in India are classified using the HSN classification code, which facilitates the use of HSN numbers for calculations of the Goods and Service Tax (GST).  
  • The number is currently being used to categorize goods to compute VAT (Value Added Tax).
  • The HSN number must be clearly mentioned on GST Invoices when preparing Tax Invoices for GST.

Significance of HS code for Khadi

  • The move is expected to boost Khadi exports in the coming years.
  • In 2006, the government had given the Export Promotion Council Status (EPCS) status to Khadi and Village Industries Commission (KVIC). Yet, the absence of a separate HS code hindered Khadi from achieving its full potential, as its exports were difficult to categorise and calculate. The latest move is expected to help resolve this issue.
  • Khadi did not have its exclusive HS code. As a result, all the data regarding export of this signature fabric used to come as a normal fabric under the textile head. Now, it will enable to keep a constant eye not only on the Khadi’s export figures, but it will also help in planning export strategies.
[Ref: The Indian Express]

 

Bilateral & International Relations

Henley Passport Index

India was `s passport index ranked 84th in the Henley Passport Index 2020.

Henley Passport Index 1

About the Henley Passport Index 2020

  • Published by Henley & Partners in 2006.
  • The Index lists the world’s passports “according to the number of destinations their holders can access without a prior visa”.
  • The ranking is based on data from the International Air Transport Association (IATA), a trade association of some 290 airlines, including all major carriers.

the-International-Air-Transport-Association-(IATA)

  • The index includes 199 different passports and 227 different travel destinations.

Highlights of the report:

  • Japan is at the top. It has been topping the Index for three straight years; according to the 2020 index, its citizens are able to access 191 destinations without having to obtain a visa in advance.

Henley Passport Index 4

  • Singapore, in second place (same as in 2019), has a visa-free/visa-on-arrival score of 190.
  • Germany is No. 3 (same position as in 2019), with access to 189 destinations;
  • The US and the UK have been falling consistently over successive Indices.

India Specific Highlights:

  • India was ranked in the band of 71st to 88th.

Henley Passport Index 3

  • Indians can travel visa-free to 58 countries in the world. Of which 20 are in Africa, 11 each in Asia and the Caribbean.
  • Serbia is the only European country to which Indian passport holders can travel visa-free. 
  • There is no major or developed country to which Indian passport holders have visa-free access.

Significance:

  • The Henley Passport Index gives a fair estimate of cross border flows of people.
  • When seen together with the World Bank`s Ease of Doing Business Index, countries whose citizens can travel unhindered to across borders have more vibrant economies.

What is the strength of a passport?

  • The strength of a passport is defined as the countries to which holders are eligible to travel without a visa.
[Ref: Indian Express, Financial Express, Economic Times]

 

Defence & Security Issues 

Arrested Landing of Light Combat Aircraft

The Naval variant of the indigenous Light Combat Aircraft (LCA)-Mk1 Tejas under development successfully completed the first arrested landing on board aircraft carrier INS Vikramaditya 

Features of LCA

Features of LCA

  • LCA is a single engine multirole light combat aircraft designed by Hindustan Aeronautics Limited(HAL) and Aeronautical Development Agency.
  • It employs a single engine, compound delta wing and tailless design.
  • It is the second supersonic fighter to be developed by HAL.
  • The Naval LCA is designed with stronger landing gears to absorb forces during take-off and landing. It also incorporates advanced avionics and other essential components.

INS Vikramaditya

stronger landing gears

  • INS Vikramaditya is an aircraft carrier purchased from Russia. It was originally known as Admiral Gorshkov.
  • It has a speed of 30 knots and can carry maximum of 36 aircrafts. MiG-29K fighters operate from this carrier.

Vikramaditya

Other Facts: The under construction INS Vikrant would be the first indigenously developed aircraft carrier after commissioning.

[Ref: The Hindu, Livemint]
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