IAS UPSC Prelims and Mains Exam – 30th August 2019

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(PRELIMS + MAINS FOCUS)

Coalition for Disaster Resilient Infrastructure (CDRI)

Part of: GS Prelims and GS Mains III – Environmental Conservation

In News

• PM Modi will launch an International CDRI during the UN Climate Action Summit in New York on September 23. 
• The Coalition’s secretariat will be set up in New Delhi. 
• The CDRI will create a mechanism to assist countries for upgrading their capacities and practices with regard to infrastructure development in accordance with their risk context and economic needs.
• It will bring together technical expertise from a multitude of stakeholders. 
• The charter of the CDRI will be finalized by the National Disaster Management Authority (in consultation with Ministry of External Affairs) after taking inputs from potential member countries 
• India will provide support of Rs 480 crore (approx. $ 70 million) to the CDRI so as to support research projects, setting up secretariat and covering recurring expenditure over a period of five years from 2019 to 2024.
• Potential: A clear niche for a Global CDRI would simultaneously address the loss reduction targets under the Sendai Framework, address a number of SDGs and also contribute to climate change adaptation.

Compensatory Afforestation Fund (CAF)

Part of: GS Prelims and Mains GS-II – Issues relating to Federalism

In News

• The Union Environment Ministry on Thursday transferred ₹47,436 crore to 27 States for afforestation as a part of CAF
• Levies are imposed on firms (under Forest Conservation Act 1980) that seeks to divert forest land for developmental activities, which are accrued in the CAF
• The amount to be paid by industry depends on the economic value of the goods and services that the razed forest would have provided. 
• These funds were supposed to be disbursed to states to plant trees elsewhere so as to compensate the loss of forest due to development projects
• Only a fraction of this corpus had actually been disbursed to states, due to the lack of a legal framework (until CAF Act, 2016) and instances of States using it for non-forestry purposes.
• The CAF Act 2016, established an independent authority — the Compensatory Afforestation Fund Management and Planning Authority — to execute the fund.
• The rules governing the management of the fund were finalised in August 2018.
• The release of fund to States will boost the efforts of the Government towards restoration and enhancement of forest wealth, enhance bio-richness, water availability and secure ecological security of the country
• The funds will also help in creating the additional carbon sink to meet the nation’s INDC of 2.5 to 3 billion tonnes of carbon dioxide equivalent through additional forest and tree cover by the year 2030.

Do You know?

• The rate of diversion of forest land for non-forestry activities is roughly 20,000-25,000 hectare per year in India (as per Minister of Environment in 2016)
• 90% of CAF funds will flow to States & UT afforestation fund which can be used for catchment area treatment, wildlife management, forest fire prevention, soil and moisture conservation work in the forest
• However, it cannot be used for payment of salary, travelling allowances, making buildings and buying office equipment for forest officers
• 10% of CAF funds will be utilized by Centre for monitoring mechanism and R&D activities

Foreign Direct Investment(FDI)

Part of: GS Prelims and GS Mains III – Economy

In News

• In an effort to get economic growth government has liberalised FDI rules in various sectors
• Digital media: Government approved FDI up to 26% under the “government route” for digital media companies that upload or stream news and current affairs.
• Digital news media was unregulated & thriving with 100% FDI was allowed in such start ups.
• Coal mining: Government permitted 100% FDI under automatic route for sale of coal, for coal mining activities including associated processing infrastructure
• This will result in FDI inflow along with updated technology, and increase India’s coal production thus reducing coal imports. It will also enhance Coal India Limited’s (CIL) competitiveness and efficiency.
• Contract Manufacturing: Government has decided to allow 100% FDI under automatic route in contract manufacturing in India.
• Single Brand Retail Trading (SBRT): All procurements made from India by the SBRT entity for the single brand shall be counted towards local sourcing, irrespective of whether the goods procured are sold in India or exported.

Do You know?

• Print media and news broadcast television companies in India have had FDI caps of 26% and 49% respectively.
• In India, it takes at least six years from getting a mine allocation to actually starting mining operations.
• In 2018-19 India spent about $8 billion on importing 125 million tonnes of coal for non-coastal thermal plants.
• State-owned Coal India and Singareni Collieries Company together accounted for 91.6% of the total coal produced in the country during FY2017-18
• Total FDI flows into India in 2018-19 i.e. US $ 64.37 billion (provisional figure) is the highest ever FDI received for any financial year.

Lucy

Part of: GS Prelims

In News

• A 3.8-million-year-old skull named MRD was discovered at a palaeontological site in Ethiopia in 2016 
• Research on MRD could now clarify the origins of Lucy, the well-known ancestor of modern humans which is estimated to be 3.2 million years old.
• The finding helps bridge a big gap between the earliest-known human ancestors (about 6 million years old) and species like Lucy.
• The dating suggests that MRD’s species could have coexisted with Lucy’s for some 100,000 years.
• It is possible that a small group of MRD’s species became genetically isolated from the rest of the population and evolved into Lucy’s species, whose population eventually out-bred MRD’s species

Do You know?

• The age of MRD was determined by dating minerals in layers of volcanic rocks near the site. 
• Researchers also combined field observations with analysis of microscopic biological remains to reconstruct the landscape, vegetation, and hydrology in the area where MRD died,
• Scientists have reconstructed MRD’s facial features and described him as “a mix of primitive and derived facial and cranial features”

(MAINS FOCUS)

ECONOMY

TOPIC:

General Studies 3

• Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.
• Effects of liberalization on the economy, changes in industrial policy and their effects on industrial growth.

General Studies 2

• Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

New FDI Norms

 Context:

• The Centre’s announcement on Foreign Direct Investment (FDI) norms on Wednesday appears to be one more push to make India a more attractive destination to overseas investors, especially those keen on entering the market for the long haul.

Concerns:

• The government, clearly concerned by the economic slowdown and persistently weak investment activity, has sought to provide a policy fillip to attract more foreign capital into sectors that it sees as having a multiplier effect particularly in terms of job creation

New Rules:

• It has provided for a relaxation of the contentious sourcing norms which have been a major deterrent for foreign investment in single-brand retail.
• Firms can adjust their entire procurement from India, be it for their domestic operations or for global markets, against their local sourcing requirements.
• Local sourcing norms need not be met annually, but as an average of the first five years.
• Sourcing, even through group companies or indirectly through third parties such as contract manufacturers, will now be counted towards their domestic sourcing obligations
• Single brand retailers have also been allowed the option of setting up their online retail platforms before putting in place a brick and mortar presence.
• The government has allowed 100 per cent FDI in contract manufacturing and in coal mining and related activities such as washery, handling and separation. 

How are the new rules significant?

• Easing of restrictions on foreign investment, which sends a positive signal to the international community
• So far, India has not been able to take advantage of this ongoing relocation of production facilities out of China. But, these changes in the rules should gradually facilitate foreign firms setting up manufacturing bases in India, providing a boost to both employment and exports.
• Allowing 100 per cent FDI in contract manufacturing through the automatic route will also attract global players looking to set up alternate manufacturing hubs — diversifying away from China. 
• Adding exports to the local sourcing norms is also likely to encourage the building of larger production facilities, providing a much needed fillip to the country’s subdued exports.
• These initiatives are an attempt to create a manufacturing ecosystem, establishing value chains with both upstream and downstream linkages
• Sectors such as electronics, mobiles, apparel and pharma are likely to benefit the most from these measures. And with India’s electronics imports exceeding $50 billion in 2018-19 — it was the biggest driver of the trade deficit after oil — over time, these measures could also help contain India’s current account deficit.

Concerns of New Rules:

• For instance, the tweaks to investment norms on coal appear at first flush to be a win-win for both the economy at large and the coal industry, the environmental costs of focusing on one of the most polluting fossil fuels notwithstanding.
• This is predicated on the prospect of seeing an influx of both capital and modern technology into mining and processing, as well as raising domestic supply of the key raw material for power, steel and cement production thereby cutting costly and burgeoning imports. 
• But for foreign mining companies to make a beeline to pitheads, several related regulatory and market challenges will have to be addressed post-haste

Conclusion:

• All these initiatives need to be accompanied by reforms, especially factor market reforms, that address the structural issues plaguing the economy.
• The continuing overvaluation of the rupee also needs to be attended to. In the coming weeks, the government is likely to announce more measures to tackle the slowdown. These should be at the top of its agenda.

Connecting the dots:

1. How does the foreign investment in India affect India’s economic growth? Critically evaluate in reference to major FDI policy decisions taken recently.

NATIONAL/WELFARE

TOPIC:General studies 2:

• Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
• Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and bodies constituted for the protection and betterment of these vulnerable sections

Marine Fisheries Regulation and Management (MFRM) Bill 2019

In news:

• A Marine Fisheries Regulation and Management (MFRM) Bill 2019 is in the public domain for discussion. 
• India has obligations to frame laws under the United Nations Convention on the Law of the Sea (UNCLOS) 1982 and the World Trade Organisation (WTO) agreements. 

UNCLOS:

Under UNCLOS, which India ratified in 1995, the sea and resources in the water and the seabed are classified into three zones — the internal waters (IW), the territorial sea (TS) and the exclusive economic zone (EEZ).

•  The IW is on the landward side of the baseline — it includes gulfs and small bays. Coastal states treat IW like land. 
• The TS extends outwards to 12 nautical miles from the baseline — coastal nations enjoy sovereignty over airspace, sea, seabed and subsoil and all living and non-living resources therein. 
• The EEZ extends outwards to 200 nautical miles from the baseline. Coastal nations have sovereign rights for exploration, exploiting, conserving and managing all the natural resources therein.

Importance of having the regulation:

• Since fisheries is a state subject, fishing in the IW and TS come within the purview of the states concerned. Other activities in the TS and activities, including fishing beyond the TS up to the limit of the EEZ, are in the Union list.
  No Central government, so far, has framed laws covering the entire EEZ.
  This would be the first one to regulate fisheries in comprehensive manner.
• The annual fishery potential of the country’s EEZ is about 5 million tonnes. Utilising it judiciously is an important priority of the government. It has been underscored by the formation of a new fisheries ministry.
• The Bill is also a response to discussions on fisheries’ subsidies at the WTO since the Doha Round of 2001. India has been defending the rights of developing nations for special and differential treatment. Developed countries contend that nations without laws to manage fisheries in their respective EEZs are not serious about unregulated fishing. The MFRM Bill is India’s response to such sentiments.

Pros:

• Bigger vessels, particularly trawlers, registered and licenced under state departments, will need a permit to fish. This is a welcome measure to manage the fishing sector.
• The Bill respects the jurisdiction of our coastal states over the TS.
• It proposes social security for fish workers and calls for protection of life at sea during severe weather events.

Cons:

• The Bill prohibits fishing by foreign fishing vessels, thus nationalising our EEZ. An Indian fishing vessel desirous of fishing in the EEZ, outside the TS, must obtain a permit. This requirement has been contested by the fishing industry — particularly small-scale operators.
• There is a faulty assumption in the Bill that only large-scale vessels fish outside the TS. Actually, thousands of small-scale fishing crafts regularly venture into such areas. Their freedom to access fish outside the TS will cease if the Bill becomes law. A few exemption clauses to safeguard their livelihoods should be incorporated in the Bill.
• The Bill lacks congruence with important regional fishery agreements. It is incomplete compared to the regulations in other coastal nations.

Conclusion:

• Fish cannot be bound by territoriality diktats of the Centre or states. Cooperative governance between them over different territories (IW, TS and EEZ) is key to the sustainable management of marine fisheries. 
• Small-scale fish workers can demand making the entire IW and TS completely free of trawling using the FAO/UN Small-Scale Fisheries Guidelines to support their arguments. This will raise their incomes, ensure a steady supply to consumers, heal the coastal areas and curb the bane of destructive fishing.

Connecting the dots:

• India is yet to have a central regulation on fisheries. In this light discuss the importance of Marine Fisheries Regulation and Management (MFRM) Bill. 

(TEST YOUR KNOWLEDGE)

Model questions: (You can now post your answers in comment section)

Note: 

• Featured Comments and comments Up-voted by IASbaba are the “correct answers”.
• IASbaba App users – Team IASbaba will provide correct answers in comment section. Kindly refer to it and update your answers.

Q.1) Consider the following statements about Compensatory Afforestation Fund(CAF)

1. The Compensatory Afforestation Fund Management and Planning Authority established under Forest Conservation Act 1980 will execute the fund.
2. 90% of CAF funds will flow to States & UT afforestation fund which can be used for catchment area treatment, wildlife management, salaries and travelling allowances for forest officers.

Which of the statement(s) given above is/are incorrect?

1. 1 only
2. 2 only
3. Both 1 and 2
4. Neither 1 nor 2

Q.2) Consider the following statements about Coalition for Disaster Resilient Infrastructure (CDRI)

1. The CDRI will create a mechanism to assist countries for upgrading their capacities and practices with regard to infrastructure development in accordance with their risk context and economic needs.
2. Its secretariat will be set up in New Delhi. 
3. The charter of the CDRI will be finalized by the National Disaster Management Authority in consultation with Ministry of External Affairs

Which of the statement(s) given above is/are correct?

1. 1 and 2 only
2. 2 and 3 only
3. 1 and 3 only
4. 1,2 and 3

Q.3) Consider the following statements 

1. Government permitted 100% FDI under automatic route for sale of coal, for coal mining activities including associated processing infrastructure 
2. Total FDI flows into India in 2018-19 is the highest ever FDI received for any financial year

Which of the statement(s) given above is/are correct?

1. 1 only
2. 2 only
3. Both 1 and 2
4. Neither 1 nor 2

Q.3) Which of the following countries are considered as part of Horn of Africa?

1. Eritrea
2. Ethiopia
3. Somalia
4. Gabon 

Select the correct answer from codes given below.

1. 1,2 and 3 only
2. 2 and 3 only
3. 1,3 and 4 only
4. 1,2,3 and 4

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