Current Affairs Analysis

6th & 7th October 2019 Current Affairs Analysis -IASToppers

Multidisciplinary Drifting Observatory for the Study of Arctic Climate (MOSAiC);Public Finance Management System (PFMS) portal; Arhatiyas; Information Fusion Centre – Indian Ocean Region (IFC-IOR); Why state budgets matter; Geotail; ‘Green’ firecrackers; Financial Action Task Force (FATF); Asia-Pacific Group on Money Laundering (APG); World Congress of Poets (WCP); New strategic disinvestment process; Department of Investment and public Asset Management (DIPAM); World Habitat Day 2019;
By IT's Current Affairs Analysis Team
October 07, 2019


Polity & Governance

  • The role of Arhatiyas in rural Punjab; row over linking farmers’ details to central database


  • Explained: Why state budgets matter
  • Cabinet approves new strategic disinvestment process

Environment, Ecology & Disaster Management

  • CSIR launches eco-friendly crackers
  • India’s Vishnu Nandan among 300 researchers to join largest ever Arctic expedition

Bilateral & International Relations

  • India starts sharing maritime data
  • Pakistan failed to fully implement UNSC obligations against designated terror groups

Science & Technology

  • Explained: How is geotail helping Chandrayaan-2 learn about Moon

Key Facts for Prelims

  • KIIT to host World Congress of Poets
  • World Habitat Day celebrated on 7 October

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Polity & Governance

The role of Arhatiyas in rural Punjab; row over linking farmers’ details to central database

Under pressure from the Centre, the Punjab Food Department has directed all government procurement agencies to link the bank accounts of farmers with the Public Finance Management System (PFMS) portal before the procurement of paddy begins.

punjab farmers

  • This has angered the arhatiyas (commission agents), a large number of whom want the government to roll back its decision.

What is the PFMS portal?


  • It is an online platform developed and implemented by the office of the Controller General of Accounts (CGA) under the Union Ministry of Finance.
  • Its objective is to establish an online financial management information system for tracking of funds released under all plan schemes and real time reporting of expenditure at all levels.
  • It is administered by the Department of Expenditure.
  • It initially started as a Plan scheme named Central Plan Scheme Monitoring System (CPSMS) of the Planning Commission in 2008-09 as a pilot in Madhya Pradesh, Bihar, Punjab and Mizoram for four Flagship schemes e.g. MGNREGS, NRHM, SSA and PMGSY.


  • It provides scheme managers a unified platform for tracking releases and monitoring their last mile utilisation.
  • It provides platform for efficient management of funds through tracking of funds and real time reporting of expenditure and receipts through treasury and bank interface.
  • The line ministries/departments utilise this platform to monitor the utilisation of funds provided to the implementing agencies and state governments.
  • PFMS is also used for DBT payments under MGNREGA and other notified schemes of the Government of India.

Why are arhatiyas against it?

  • In the present case, the idea is to monitor the accounts of farmers to ensure they get the payment for their crops from the arhatiyas, who pay farmers only after selling their produce and receiving the money from the buyers.
  • The Food and Civil Supplies Department has announced that if accounts are not linked with the PFMS portal, the arhatiyas’ commission would not be released.
  • The arhatiyas have claimed that the farmers are not willing to share the details.
  • They also fear that the government might, in future, make payments directly to farmers cutting the agents out altogether.

Is this effort an entirely new initiative?

  • Punjab’s earlier government had launched a ‘direct payment’ scheme under the Punjab Agriculture Market Act, under which farmers to received payments directly for their crop sold to government agencies.
  • In April 2019, Union Minister for Consumer Affairs asked Punjab to take the procurement system online to cut out arhatiyas’s high commission in Punjab compared to other states.
  • However, neither of these efforts were successful.

What are Arhatiyas are important?

  • Arhatiyas are powerful figures in the rural landscape as each Arhatiya (agent) has between 20 and 200 farmers, whose crops he sells.
  • Even the government is dependent on the arhatiyas, who provide fans, weighing machines, and labour to shortstaffed government agencies.
  • Arhatiyas are also moneylenders who fund farmers’ requirements of cash for both cropping operations and personal and social requirements.
  • For many farmers, borrowing from the arhatiya, whom they know personally, is easier and more convenient than approaching a bank with its unfamiliar procedures.
[Ref: Indian Express, PIB]



Explained: Why state budgets matter

Recently, the Reserve Bank of India released its annual study of state-level budgets. With each passing year, understanding about state government finances is becoming more and more important.


Reason for importance of state budget

  • States spend one-and-a-half times more than the Union government and, in doing so, they employ five times more people than the Centre. Hence, states have a greater role to play in determining India’s GDP than the Centre and are also the bigger employment generators.
  • Since 2014-15, states have increasingly borrowed money from the market. This trend has serious implications on the interest rates charged in the economy, the availability of funds for businesses to invest in new factories, and the ability of the private sector to employ new labour.

Highlights of the RBI report on state budget


  • Except during 2016-17, state governments have regularly met their fiscal deficit target of 3% of GDP even after extensive farm loan waivers and implementation of UDAY scheme (take over the debts of power distribution companies by state governments).
  • However, most states met the fiscal deficit target not by increasing their revenues but by reducing their expenditure and increasingly borrowing from the market.
  • States revenue prospects are confronted with low tax buoyancies, shrinking revenue autonomy under the GST framework and unpredictability associated with transfers of IGST and grants.
  • Unrealistic revenue forecasts in budget estimates thereby leave no option for states than expenditure compression in even the most productive and employment-generating heads.

Why fiscal deficit matters? What happens if the debt-to-GDP ratio widens?

  • Each year’s borrowing (or deficit) adds to the total debt. Paying back this debt depends on a state’s ability to raise revenues.
  • If a state, or all the states in aggregate, find it difficult to raise revenues, a rising mountain of debt — captured in the debt-to-GDP ratio — could start a vicious cycle.
  • Then, states end up paying more and more towards interest payments instead of spending their revenues on creating new assets that provide better education, health and welfare for their residents.
  • That is why, the 14th Finance Commission had mandated prudent levels of both fiscal deficit (3% of state GDP) and debt-to-GDP (25%) that must not be breached.

Key Facts

  • The 14th Finance Commission had mandated prudent levels of both fiscal deficit (3% of state GDP) and debt-to-GDP (25%) that must not be breached.
[Ref: Indian Express]


Cabinet approves new strategic disinvestment process

The Cabinet has approved a new process of strategic disinvestment with a view to expediting privatisation of select PSUs.


About the new process of strategic disinvestment

  • The Department of Investment and Public Asset Management (DIPAM) under the Ministry of Finance has been made the nodal department for the strategic stake sale.
  • In other words, DIPAM and NITI Aayog will now jointly identify PSUs for strategic disinvestment.
  • Also, DIPAM secretary would now co-chair the inter-minister group on disinvestment, along with the secretary of administrative ministries concerned.

Aim behind the new process

  • This was done with a view to streamlining and speeding up the process, reducing the role of administrative ministries which often used to place hurdles in the path of major stake sales.

What is strategic disinvestment?

strategic disinvestment

  • It means when a significant proportion of a Public Sector Unit’s (PSU) share and the management control goes to a private sector strategic partner.
  • The move is generally undertaken to mobilize more funds however, it is also to enable better use of the resource and its more efficient allocation.
  • It is different from the ordinary disinvestment in which management of PSU is retained with Government.


  • Department of Investment and public Asset Management (DIPAM)is a nodal agency of the Union Ministry of Finance that has been authorised to advise the Union Government in the matters of the financial restructuring of PSUs and also for attracting investment through capital markets.
  • The main vision of the agency is to promote people’s ownership of Central Public Sector Enterprises to share in their prosperity through disinvestment.
  • It also aims to efficiently manage public investment in CPSEs in order to accelerate economic development and boost Government’s resources for higher expenditure.
[Ref: Economic Times]


Environment, Ecology & Disaster Management

CSIR launches eco-friendly crackers

Minister for Science and Technology and Earth Sciences launched a set of new crackers that promises to help reduce particulate emissions by 30 % while producing the same level of light and sound effects of traditional fireworks.


About the new fireworks

  • The new firework is based on formulations developed by a consortium of eight laboratories under the Council of Scientific and Industrial Research (CSIR) led by Nagpur-based National Environmental Engineering Research Institute.


  • New set of crackers would have a green logo to differentiate them from the conventional ones. Further, it would carry QR code for monitoring. Scanning of the code would provide all information about the product, including the chemicals and the process used.


  • CSIR had taken up the project to develop eco-friendly crackers in the wake of directions of the Supreme Court restricting the use of fireworks to address the growing problem of pollution in different parts of the country.


  • Under the Supreme Court order, the green crackers can’t be loud beyond a limit and have to be free of arsenic, barium and mercury. The crackers also have to be approved by the Petroleum and Explosives Safety Organisation (PESO).
  • The project adopted a two-pronged approach. While one stream of activity was focussed on improving the traditional crackers through reduction in the level of Barium Nitrate, the second pathway aimed at replacing Barium Nitrate (green oxidizing agent) with Potassium Nitrate.

What are green crackers?

They are known as ‘green’ firecrackers because they have a chemical formulation that produces water molecules, which substantially reduces emission levels and absorbs dust.


  • They are less harmful and less dangerous than the conventional ones. They are the crackers with reduced emission and decibel level.
  • It promises a reduction in particulate matters and harmful gases, like nitrous oxide and sulfur oxide, by 30- 35 per cent.
  • The green crackers will be 25-30 per cent cheaper to manufacture and manufacturers would not have to make any changes in their facilities.

Key Facts

  • Aluminium powder, sulphur and potassium nitrate make noise-making crackers, while barium nitrate (green) and strontium nitrate (red) emit light.

greeen-crackers 1

[Ref: The Hindu]


India’s Vishnu Nandan among 300 researchers to join largest ever Arctic expedition

The 32-year-old polar researcher from Kerala will be the only Indian among 300 scientists aboard the German research vessel Polarstern on MOSAiC expedition.


About (MOSAiC) expedition


  • MOSAiC stands for Multidisciplinary Drifting Observatory for the Study of Arctic Climate.
  • It is the largest polar expedition in history.
  • It is led by the Alfred Wegener Institute in Germany.
  • The goal of the MOSAiC expedition is to take the closest look ever at the Arctic as the epicenter of global warming and to gain fundamental insights that are key to better understand global climate change.
  • It will be the first to conduct a study of this scale at the North Pole for an entire year.
  • The aim of the expedition will be to parameterise the atmospheric, geophysical, oceanographic and all other possible variables in the Arctic, and use it to more accurately forecast the changes in our weather systems.
  • The international expedition will involve more than 60 institutions from 19 countries.

Significance of MOSAiC:

  • MOSAiC will contribute to a quantum leap in our understanding of the coupled Arctic climate system and its representation in global climate models.
  • The focus of MOSAiC lies on direct in-situ observations of the climate processes that couple the atmosphere, ocean, sea ice, biogeochemistry, and ecosystem.

Importance of study of changes in the Arctic:

  • The Arctic is the key area of global climate change, with warming rates exceeding twice the global average and warming during winter even larger.
  • It is well possible that the Arctic ocean will become ice free in summer during the 21st century.
  • This dramatic change strongly affects weather and climate on the whole northern hemisphere and fuels rapid economic development in the Arctic.
[Ref: The Hindu]


Bilateral & International Relations

India starts sharing maritime data

The Information Fusion Centre – Indian Ocean Region (IFC-IOR) set up last year has started functioning as an information sharing hub of maritime data and cuing incident responses to maritime security situations through a collaborative approach.


Major centres

The major centres with which regular exchange of maritime security information is being undertaken include

  • Virtual Regional Maritime Traffic Centre (VRMTC)
  • Maritime Security Centre – Horn of Africa(MSCHOA)
  • Regional Cooperation Agreement on Combating Piracy and Armed Robbery (ReCAAP)
  • Information Fusion Centre-Singapore (IFC-SG)
  • and International Maritime Bureau – Piracy Reporting Centre (IMB PRC)

About Information Fusion Centre – Indian Ocean Region (IFC-IOR)


  • Launched in 2018, it is an initiative started by the Indian Navy.
  • The IFC has been established at Gurugram, and is collocated with Information Management and Analysis Centre (IMAC)which is jointly administered by the Indian Navy and Indian Coast Guard.
  • This is the single point centrelinking all the coastal radar chains to generate a seamless real-time picture of the nearly 7,500-km coastline.
  • It aims to advance Maritime Safety and Securityin the Indian Ocean Region by enhancing maritime domain awareness and coordinating activities.
  • Through this Centre, information on “white shipping”, or commercial shipping, is exchanged with countries in the region to improve maritime domain awareness in the Indian Ocean.
  • IFC-IOR is also works towards coordination of incident response and disaster relief, and in time, also share submarine safety information.
[Ref: The Hindu]


Pakistan failed to fully implement UNSC obligations against designated terror groups

The Financial Action Task Force said Pakistan had not complied with four out of 40 recommendations, and had fully complied with only one.

pak fatf

What is the issue?

  • Financial Action Task Force’s Asia Pacific Group has found that Pakistan failed to fully implement its obligations under a United Nations Security Council resolution against designated terrorists.


  • In June 2018, Pakistan was put on grey list of FATF and given an action plan to implement in order to be taken off the list by October 2019.
  • However, in august 2019, the mutual evaluation report on Pakistan, adopted by the Asia Pacific Group on Money Laundering of FATF, found that the Pakistan had only fully complied with only one recommendation out of 40.
  • The recommendations were related to identifying, assessing and understanding its money laundering or terror funding risks associated with outfits operating in its territory such as the Islamic State group.
  • Hence, Financial Action Task Force’s Asia Pacific Group placed Pakistan on an enhanced expedited follow-up list (also known as the blacklist) for non-compliance and non-enforcement of safeguards against terror financing and money laundering.

Financial Action Task Force (FATF)


  • FATF is an inter‐governmental policy making body with ministerial mandate to establish international standards for combating money laundering and terrorist financing.
  • It was created in 1989 at the behest of the G7, and is headquartered at
  • The FATF’s decision making body, the FATF Plenary, meets three times per year.
  • It does not addressat all issues related to low tax jurisdiction or tax competition.
  • The FATF is a policy-making body and has no investigative authority.


  • The FATF monitors the progress of its members in implementing necessary measures, reviews money laundering and terrorist financing techniques and counter-measures, and promotes the adoption and implementation of appropriate measures globally.
  • In collaboration with other international stakeholders, the FATF works to identify national-level vulnerabilities with the aim of protecting the international financial system from misuse.


  • A large number of international organizations participate in the FATF as observers, each of which has some involvement in anti-money laundering activities.
  • Organizations such as Interpol, the International Monetary Fund (IMF), Organization for Economic Cooperation and Development (OECD), and World Bankare observers.

What is blacklist and grey list?

  • FATF maintains two different lists of countries: Grey list and Black list.
  • Those that have deficiencies in their Anti-Money Laundering /Countering Financing of Terrorism (AML/CTF) regimes, but they commit to an action plan to address these loopholes are put in grey list and those that do not end up doing enough are put in black list.
  • Once a country is blacklisted, FATF calls on other countries to apply enhanced due diligence and counter measures, increasing the cost of doing business with the country and in some cases severing it altogether.

blacklist and grey list

  • Although the Gulf Cooperation Council (GCC) is a full Member of the FATF, the individual Member countries of the GCC (of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates) are not.

About Asia-Pacific Group on Money Laundering (APG)


  • At the Fourth symposium of FATF-Asia Secretariat in Bangkok in 1997, the Asia/Pacific Group on Money Laundering (APG) was established as an autonomous regional anti-money laundering bodyby agreement among 13 original founding members. 
  • A new secretariat was also established to serve as the focal point for APG activities to be located in Sydney, Australia.
  • The APG is part of Financial Action Task Force-Style Regional Bodies (FSRBs)and is the largest in terms of membership numbers and geographical size.
  • The APG, in conjunction with 8 FSRBs constitute a global network to combat money laundering, the financing of terrorism and the financing of proliferation of weapons of mass destruction.  The FATF’s 40 recommendations are the principal standardsto combat these crimes.
  • APG has 41 member countries (including India) and 8 observer countries.

Key facts

  • Initially, it was only dealing with developing policies to combat money laundering. But in 2001 its purpose was expanded to act against terrorism financing.
  • Currently, it comprises two regional organisations (the EU and the Gulf Co-operation Council) and 35 member jurisdictions, including India, UK, US, China and the European Commission.
  • Pakistan is not a member state of FATF: instead, it is a FATF Associate Member of the Asia/Pacific Group on Money Laundering (APG).
[Ref: The Hindu, Livemint]


Science & Technology

Explained: How is geotail helping Chandrayaan-2 learn about Moon

Recently, the Indian Space Research Organisation (ISRO) said that an instrument on Chandrayaan-2, CLASS had detected charged particles during the orbiter’s passage through the “geotail”.

What is geotail?


  • The Sun emits the solar wind, which is a continuous stream of charged particles. Since the Earth has a magnetic field, it obstructs the solar wind plasma. This interaction results in the formation of a magnetic envelope around Earth, called the
  • On the Earth side facing the Sun, the envelope is compressed into a region that is approximately three to four times the Earth radius.
  • On the opposite side, the envelope is stretched into a long tail, which extends beyond the orbit of the Moon. It is this tail that is called the geotail.
  • Approximately, once every 29 days, Moon traverses the geotail for about 6 days centered around full moon.
  • The geotail is a region in space that allows the best observations.

About detection of charged particles in geotail

  • The CLASS instrument on Chandrayaan-2 is designed to detect direct signatures of elements present in the lunar soil.
  • This is best observed when a solar flare on the Sun provides a rich source of x-rays to illuminate the lunar surface. This x-ray emission can be detected by CLASS to directly detect the presence of key elements such as Sodium (Na), Calcium (Ca) etc.
  • When Chandrayaan-2, which is orbiting the Moon, crosses the geotail, its instruments can study the properties of the geotail.
[Ref: Indian Express]


Key Facts for Prelims

KIIT to host World Congress of Poets

The Kalinga Institute of Industrial Technology (KIIT) Deemed to be University will host the 39th World Congress of Poets (WCP) in Odisha from October 2, coinciding with the 150th Birth Anniversary of Mahatma Gandhi.


  • This is the third time WCP is being hosted in India. On previous two occasions it was held in Chennai in 1986 and 2007.
  • During this congress, the highest honour of WCP ‘Golden Gabel’ will be given. Besides that, Gandhi Prize for Literature will be awarded.

About World Congress of Poets

  • The World Congress of Poets (WCP) was founded in 1969 by and held for the first time in Manila, Philippines.


Eligibility criteria:

The eligibility criteria for poets to be participating in the Congress are as follows:

  • The poet should have minimum of one book published with an ISBN.
  • The poet should have a recommendation letter from a poetry society that is legally established and has a legal existence.
[Ref: Times of India]


World Habitat Day celebrated on 7 October

The United Nations designated the first Monday of October of every year as World Habitat Day to reflect on the state of towns and cities, and on the basic right of all to adequate shelter.


  • The theme for World Habitat Day 2019 is ‘Frontier Technologies as an innovative tool to transform waste to wealth’.

Key facts:

  • The United Nations Human Settlements Programme in 1989 launched the ‘UN-Habitat Scroll of Honour award’. It is the most prestigious human settlements award in the world. The winners of the award are honoured on the occasion of the day.

Following are some of the UN-Habitat’s main focus areas:


  • Inclusive housing and social services
  • A safe and healthy living environment for all — with particular consideration for children, youth, women, elderly and disabled
  • Affordable and sustainable transport and energy
  • Promotion, protection, and restoration of green urban spaces
  • Safe and clean drinking water and sanitation
  • Healthy air quality
  • Job creation
  • Improved urban planning and slum upgrading
  • Better waste management
[Ref: The Hindu]


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