DAILY CURRENT AFFAIRS IAS | UPSC Prelims and Mains Exam – 11th January 2022

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(PRELIMS + MAINS FOCUS)

Second Round Of The Quarterly Employment Survey (QES)

Part of: Prelims and GS-III -Employment

Context: Union Labour and Employment Ministry released July-Sept. 2021 employment figures under the second round of the Quarterly Employment Survey (QES).

Key takeaways

• More hiring: Nine sectors that account for about 85% of total employment in establishments with 10 or more workers hired two lakh more people in July-September 2021 compared to April-June 2021,
• Increased total employment: The estimated total employment in the nine selected sectors is 3.10 crore approximately, which is 2 lakh higher than the the first round of QES (April 1, 2021).
  • The report covers manufacturing, construction, trade, transport, education, health, accommodation and restaurants, IT/BPOs and financial services sectors.
• 90% of the establishments had less than 100 workers, while 30% of the IT/BPO establishments had at least 100 workers.
• Female workers: The overall percentage of female workers stood at 32.1%, higher than 29.3% reported during the first round of QES.
• In the construction sector, 20% of the workers were contractual and 6.4% were casual workers.
• While most of the vacancies (65.8%) were for unspecified reasons, 23% were due to resignation and 11.7% due to retirement of employees.

Khadi Handmade Paper Slippers 

Part of: Prelims and GS-III Economy

Context Starting 14th January, Khadi and Village Industries Commission (KVIC) will begin the sale of Khadi handmade paper “Use & Throw” slippers for the use of the devotees and the workers at the Kashi Vishwanath Temple in Varanasi

Key takeaways 

• The slippers will be sold by Kashi Hastkala Pratisthan, a registered Khadi Institution in Varanasi.
• It is forbidden to wear footwear made of leather or rubber on the temple premises.
• The “use & throw” slippers made of handmade paper will maintain the sanctity of the temple and at the same time will also save devotees from heat and cold during harsh weather conditions. 
• These slippers will prevent any kind of pollution as they are made of natural fibres.
• These slippers have been developed for the first time in India.
• These are 100% eco-friendly and cost-effective.
• The Handmade paper used is completely wood-free and made of natural fibres like Cotton & Silk rags and agro waste.

Khadi and Village Industries Commission (KVIC)

• It is a statutory body established under KVIC Act, 1956 and functions under the Ministry of Micro, Small, and Medium Enterprises.
• It is charged with the planning, promotion, organisation and implementation of programmes for the development of Khadi and other village industries in the rural areas in coordination with other agencies engaged in rural development wherever necessary.

Sea Dragon exercise

Part of: Prelims and GS-II – International Relations 

Context:  India and its partners in the Quadrilateral Security Dialogue or Quad along with Canada and South Korea participated in the multinational exercise Sea Dragon at Guam in the Western Pacific.

About the exercise

• It is a US-led multinational exercise designed to practice and discuss Anti-submarine warfare tactics to operate together in response to traditional and non-traditional maritime security challenges in the Indo-Pacific region.
• This exercise primarily focuses on anti-submarine warfare (ASW) training.
• It will involve more than 270 hours of in-flight training and activities ranging from tracking simulated targets to tracking a US Navy submarine. 
• Each event will be graded and the country scoring the highest points will receive the Dragon Belt award.
• The Royal Canadian Air Force won the Dragon Belt at last year’s exercise and is defending the title at Sea Dragon 2022.
• The wargame includes contingents from the Indian Navy, the US Navy, Royal Australian Air Force, Royal Canadian Air Force, Japan’s Maritime Self-Defense Force and the South Korean Navy.

About Quad

• It is an informal strategic forum between India, US, Japan, and Australia.
• The strategic alliance was formed to ensure peace and stability in the Indo-Pacific and check China’s expansionist efforts in the region. 
• It was first mooted by Japanese Prime Minister Shinzo Abe in 2007 with the support of Vice President Dick Cheney of the US, Prime Minister John Howard of Australia and Prime Minister Manmohan Singh of India.
• The dialogue was paralleled by joint military exercises of an unprecedented scale, titled Exercise Malabar. 
• The first iteration of the Quad ceased to exist following the withdrawal of Australia in February 2008, after a joint naval exercise between the Quad and Singapore drew diplomatic protests from China.
• However, during the 2017 ASEAN Summits all four former members rejoined in negotiations to revive the quadrilateral alliance.
• The Quadrilateral met five times in 2017–2019. 
• In March 2020, officials from the Quadrilateral met to discuss the COVID-19 pandemic and they were joined by New Zealand, South Korea and Vietnam for the first time.

Person in News: Aung San Suu Kyi

Part of: Prelims and GS-II – International Relations 

Context: A court in military-ruled Myanmar sentenced ousted leader Aung San Suu Kyi to four years in jail on charges including possession of unlicensed walkie-talkies.

• Myanmar has been in turmoil since the coup against Ms. Suu Kyi’s democratically elected government led to widespread protests and signalled the end of 10 years of tentative political reforms that followed decades of strict military rule.

Aung San Suu Kyi

• Aung San Suu Kyi (born 1945) is a Burmese politician, diplomat, author, and a 1991 Nobel Peace Prize laureate who served as State Counsellor of Myanmar (equivalent to a prime minister) and Minister of Foreign Affairs from 2016 to 2021.
• She has served as the chairperson of the National League for Democracy (NLD) since 2011.
• Suu Kyi, whose party had won the November 2020 Myanmar general election, was arrested on 1 February 2021 following a coup d’état that returned the Military leaders to power

(News from PIB)

Target Olympic Podium Scheme

Part of: Prelims

• TOPS provides customised support to athletes in areas not covered under the ACTC and addresses unanticipated needs of the athletes as they prepare to excel in the Olympic and Paralympic Games.
• The Ministry primarily supports elite athletes under the Annual Calendar for Training and Competition (ACTC) of each National Sports Federation.
• Notable names included: Ace rider Fouaad Mirza, golfers Anirban Lahiri, Aditi Ashok and Diksha Dagar and Alpine Skier Mohammed Arif Khan

About Athletes:

• Mohammed Arif Khan became the first Indian Alpine Skier to qualify for the Winter Olympic Games 2022 to be held in Beijing next month. 
• Riding Seigneur Medicott, Fouaad Mirza won the Eventing-individual silver medal in the 2018 Asian Games in Jakarta and finished 23rd in the Olympic Games in Tokyo last year. Based in Germany, he is currently ranked 87 in the world. 
• Astride Mokatoo, the 29-year-old logged in two top-10 finishes in Sopot in September and Pratoni del Vivaro in November.
• The 23-year-old Aditi Ashok, wrested the nation’s attention in Tokyo2020 after being in medal reckoning throughout the competition. 
• The 21-year-old left-hander Diksha Dagar, who is from Jhajjar in Haryana and is a silver medalist in the 2017 Summer Deaflympics, finished 50th in the Olympic Games last year.
• Teenaged Judokas Yash Ghangas (+100kg class), Linthoi Chanambam (57kg) and Unnati Sharma (63kg) won a silver medal each in the Asia-Oceania Junior Championships in Lebanon, Beirut, last month. 
• Yash Ghangas rose from Panipat in Haryana to express himself on the mat while Lintho Chanambam hails from Manipur and Unnati is from Uttarakhand.

News Source: PIB

Production Linked Incentive Scheme for Automobile and Auto Component Industry in India

Part of: Prelims and Mains GS-3- Indian Economy

Context: A total of 115 companies have filed their applications under the Production Linked Incentive Scheme for Automobile and Auto Component Industry in India. 

• Incentive structure to encourage industry to make fresh investments in indigenous supply chain/ deep localization of Advanced Automotive Technology products
• PLI Scheme for Automotive Sector along with PLI scheme for ACC and FAME  to enable India to leapfrog to environmentally cleaner, sustainable, advanced and more efficient Electric Vehicles (EV) based system

Production linked incentive (PLI) scheme aims at boosting domestic manufacturing and exports, is expected to –

• Increase the country’s production by USD 520 billion in the next five years
• Make India self-reliant in manufacturing goods for local and export markets, positioning it as a global manufacturing hub
• Make domestic manufacturing competitive and efficient, build capacity, and benefit from economies of scale, enhance exports, attract investment and create jobs. 

Production Linked Incentive Scheme for Automobile and Auto Component

The scheme has two components viz Champion OEM Incentive Scheme and Component Champion Incentive Scheme, and will be implemented over a period of five years starting from FY 2022-2023.

• Envisages to overcome the cost disabilities of the industry for manufacture of Advanced Automotive Technology products in India. 
• The incentive structure will encourage industry to make fresh investments for indigenous global supply chain of Advanced Automotive Technology products. 
• It is estimated that over a period of five years, the PLI Scheme for Automobile and Auto Components Industry will lead to fresh investments of over Rs 42,500 crores, incremental production of over Rs 2.3 lakh crore and will create additional employment opportunities of over 7.5 lakh jobs. 
• Increase India’s share in global automotive trade.
• The scheme has been devised for both existing automotive firms and new investors.
• The ‘sales value linked’ scheme includes a ‘champion OEM’ incentive applicable on battery electric vehicles and hydrogen fuel cell vehicles.
• A ‘component champion’ incentive is for advanced automotive technology components.

News Source: PIB

Year End Review of Ministry of Skill Development and Entrepreneurship

Part of: Prelims and Mains GS-3- Skill Development

Pradhan Mantri Kaushal Vikas Yojana 3.0

PMKVY 3.0 will encourage and promote skill development throughout the country to address the industry needs, meet the market demands, impart skills in services and in new-age job roles that have become crucial in the post- pandemic era.

• Create an ecosystem for the youth to make informed choices on the available skilling avenues.
• Provide support to youth for skill training and certification.
• Promote sustainable Skill Centres for greater participation of private sector.
• Benefit 8 lakh youth across the country.

Schemes under PMKVY 3.0:

• Customized Crash Course Programme for COVID Warriors under PMKVY 3.0: Aims to meet the upsurge in demand of skilled healthcare professionals and associated professionals from logistics sector, reduce the burden of existing healthcare professionals and provide timely healthcare services in every corner of the country.
• Upskilling for Weavers and Artisans in Traditional Crafts in Nagaland and Kashmir- A RPL (Recognition of Prior Learning) project under PMKVY 3.0 is being implemented with value addition services such as Entrepreneurship Building and design development (RPL Type 1 with Bridge Module).
• Special project on revival of Heritage Namda Craft in Jammu & Kashmir- Aims to address skills development needs in the Craft of Namda that is practiced mainly in Kashmir, with a reasonable scale (2,250 beneficiary candidates over 24 months) to deliver real, visible and holistic benefits.
• Upskilling for Street Food Vendors (for e-cart license) in East Delhi Municipal Corporation- RPL for 2500 street food vendors who apply for e-cart license to upskill them and make them well versed in hygiene, safety, customer centricity, digital transactions, and entrepreneurship skills.
• Launch of RPL project in Nagaland: For upskilling the cane and bamboo artisans of Nagaland under Recognition of Prior Learning (RPL), component of PMKVY; to upskill the local weavers and artisans to enhance their productivity through RPL assessment and certification in traditional handicrafts. The project targets to upskill over 4,000 craftsmen and artisans.

Skills Acquisition and Knowledge Awareness for Livelihood Promotion (SANKALP)

• A Centrally sponsored scheme of MSDE, loan assisted by the World Bank.
• Objective: to strengthen the short-term skill ecosystem and to address key issues of skilling in the country; met through its three key result areas namely 

(i) Institutional Strengthening at National, State & District level; 

(ii) Quality improvement of skill development programmes; and 

(iii) Inclusion of marginalized population in skill development programmes.

National Apprenticeship Promotion Scheme (NAPS)

• To promote the apprenticeship programme in India by introducing a package of financial incentive to establishments engaging apprentices. 
• This package is specially intended to support and promote apprenticeship in the MSME segment for enhancing its productivity and competitiveness as well capacity building.

Jan Shikshan Sansthan (JSS) Scheme

• Providing vocational skills to non-literates, neo-literates and school dropouts by identifying skills that have a market in the region of their establishment.

Skill Development Programmes of India

(Mains Focus)

ECONOMY/ GOVERNANCE

• GS-3: Indian Economy & its challenges
• GS-2: Governance; Federalism & its challenges

GST reform needs a new grand bargain

Context: Just a day ahead of the 46th meeting of the GST Council on December 31, the Finance Ministers of several States had a pre-Budget interaction with the Union Finance Minister and demanded that the GST compensation scheme be extended beyond June 2022, when it is set to expire. 

• Three years ago, the Centre and the States of the Union of India struck a grand bargain resulting in the launch of the unified Goods and Services Tax (GST) era. 
• The States gave up their right to collect certain taxes, and the Centre gave up excise and services tax. 
• The nationwide GST promised frictionless commerce across State borders, buoyant and leakproof tax compliance, and removal of inefficiencies like the cascade of “tax on tax”. 
• This historic grand bargain was the result of painstaking consensus building, which inter alia involved addressing the apprehension of States, of revenue loss due to the GST.

Challenges of GST – Abdication of responsibility by Centre

• State’s consent was secured by a promise of reimbursing any shortfall in tax revenues for a period of five years. This reimbursement was to be funded by a special cess called the GST compensation cess. 

• The promised reimbursement was to fill the gap for an assured 14% year on year tax growth for five years.

• As the economy battles a pandemic and recession, the tax collection has dropped significantly, while expenditure needs are sharply higher, especially at the frontline of the battle, at the State level. 

• But it seems that the States have been told that they are on their own to meet the shortfall in revenues. 

• Using an equivalent of the Force Majeure clause in commercial contracts, the Centre is abdicating its responsibility of making up for the shortfall in 14% growth in GST revenues to the states.

• • Farce Majeure means unforeseeable circumstances that prevent someone from fulfilling a contract.

Why the onus is on the Centre

The abdication of responsibility by centre is wrong on many counts. 

• First, the States do not have recourse to multiple options that the Centre has, such as issue of a sovereign bond (in dollars or rupees) or a loan against public sector unit shares from the Reserve Bank of India. 
• Second, the Centre can anyway command much lower rates of borrowing from the markets as compared to the States. 
• Third, in terms of aggregate public sector borrowing, it does not matter for the debt markets, nor the rating agencies, whether it is the States or the Centre that is increasing their indebtedness. 
• Fourth, fighting this recession through increased fiscal stimulus is basically the job of macroeconomic stabilisation, which is the Centre’s domain. 

• Fifth, and most importantly, breaking this important promise, using the alibi of the COVID-19 pandemic causes a serious dent in the trust built up between the Centre and States.

• • Kautilya too would have advised the sovereign against reneging on the promised bailout, as fulfilling the obligation helps build trust with sub-sovereigns.

• The issue of GST compensation to the States is just the latest in the bumpy three-year journey of the new tax design. It is clear that the design needs a radical overhaul. 
• Just tinkering with the compensation mechanism, or frequently changing rate slabs, or pushing more goods in the “sin tax” cess category, to earn revenue that is not shareable with the States, is not the way forward. What we instead need is a Grand Bargain 2.0 between the sovereign and the sub-sovereign entities.

The Australian example

• A comparison with Australia which also coincidentally shares its GST anniversary with India, is apt. For the past two decades their GST rate has been constant at 10%. 
• Of course India’s single rate of 12% has to cover petrol, diesel, electricity, transport and real estate as well. Some extra elbow room for the States’ revenue autonomy is obtained by allowing the States non VATable surcharges on a small list of “sin” goods such as liquor, tobacco, polluting goods such as sport utility vehicles, and industrial fuels such as diesel, aviation turbine fuel and coal. 
• A low moderate single rate of 12% encourages better compliance, reduces the need to do arbitrary classification and discretion, reduces litigation and will lead to buoyancy in collection.
• Incidentally this redesign will scrupulously avoid the bogey of a “revenue neutral rate” (RNR) which needlessly occupied the attention of lawmakers and officials. 
• GST is a long-term structural reform, while RNR is a short term and basically an elusive concept. 
• In the long term there are many changes in consumption patterns, production configurations and locations, which cannot be anticipated and hence a static concept of RNR cannot be the reference. 
• The commitment to a low and stable rate, à la Australia and many other federal democracies, is a must. 
• Of course the compensation-cum-reimbursement incentive can remain, but more in the nature of what was done for VAT harmonisation.

Third tier of government

• This new grand bargain must recognise the increasing importance of the third tier of government. 
• Even after 28 years of the 73rd and 74th Amendments, the local governments do not have the promised transfer of funds, functions and functionaries. 
• These local bodies face increased responsibility of providing government services especially in view of increased urbanisation and decentralisation. 
• Of the 12% GST, 10% should be equally shared between the States and the Centre, and 2% must be earmarked exclusively for the urban and rural local bodies, which ensures some basic revenue autonomy to them. 
• The actual distribution across panchayats, districts and cities would be given by respective State Finance Commissions. 
• GST consumption tax paid by every citizen establishes a tighter link between the governed and the government. 
• The quality of governance improves as also, the tax base is better aligned with responsibilities of various tiers of government.
• We also need to zero rate exports. GST is a crucial and long-term structural reform which can address the fiscal needs of the future, strike the right and desired balance to achieve co-operative federalism and also lead to enhanced economic growth. 
• The current design and implementation has failed to deliver on that promise. A new grand bargain is needed.

Connecting the dots:

• Direct Tax Code
• Fiscal Federalism

INTERNATIONAL/ ECONOMY

• GS-2: Effect of policies and politics of developed and developing countries on India’s interests

China’s Developing Status at WTO

Context: China’s status as a ‘developing country’ at the World Trade Organization (WTO) has become a contentious issue with a number of countries raising concerns over the upper middle-income nation deriving benefits reserved for developing countries under WTO norms. 

• Moreover, concerns have been raised over the ‘least developed country’ (LDC) status, with Bangladesh potentially losing this tag after surpassing India in terms of GDP per capita.

What are the benefits of ‘developing country’ tag?

• Certain WTO agreements give developing countries special rights through ‘special and differential treatment’ (S&DT) provisions, which can grant developing countries longer timeframes to implement the agreements and even commitments to raise trading opportunities for such countries.
• WTO pacts are often aimed at reduction in government support to certain industries over time and set more lenient target for developing nations and grant them more time to achieve these targets compared to developed ones.
• The classification also allows other countries to offer preferential treatment.

How is a ‘developing country’ decided and why are some against China being classified as one?

• The WTO has not defined ‘developed’ and ‘developing’ countries and therefore member countries are free to announce whether they are ‘developed’ or ‘developing’.
• However, given the rise in China’s per capita income to become an upper middle-income country according to the World Bank and the country’s alleged use of unfair trade practices such as preferential treatment for state enterprises, data restrictions and inadequate enforcement of intellectual property rights, a number of nations have called on China to either refrain from seeking benefits available to developing countries or forego its classification as a developing country altogether.
• Australia too had recommended that China relinquish “its access to special and differential treatment”. China’s per capita income was $10,435 in 2020 according to the World Bank while that of India was $1,928.

How has China responded? What would be the impact of China losing this status?

• China has consistently maintained that it is the “world’s largest developing economy” but has recently indicated that it may be willing to forego many benefits of being a developing country.
• China’s Ambassador to the WTO, has reportedly said that the country may forego all exemptions available to developing countries in negotiations aimed at cutting fishing subsidies to curb overfishing.
• A change in status for China to a “developed country” would impact negotiations in future agreements. “In effect China has (like developed countries) reduced its tariffs on most products to quite a significant extent.”

What are the benefits of LDC classification?

• The WTO recognises LDCs relying on a classification by the UN based on a criteria that is reviewed every three years. LDCs are often exempted from certain provisions of WTO pacts. 
• Bangladesh, currently classified as an LDC, receives zero duty, zero quota access for almost all exports to the EU. It is, however, set to graduate from the LDC status in 2026 as its per capita GDP has risen sharply surpassing that of India in FY21.

(Down to Earth: Pollution)

Dec 10: Pollution bouncing back in middle and lower Indo-Gangetic Plain-https://www.downtoearth.org.in/news/pollution/pollution-bouncing-back-in-middle-and-lower-indo-gangetic-plain-cse-81059

  TOPIC:

• GS-3- Pollution

Pollution bouncing back in middle and lower Indo-Gangetic Plain

Context: Pollution is bouncing back in the eastern states of West Bengal, Bihar and Odisha after a short decline due to disruption by the novel coronavirus disease (COVID-19) pandemic, according to a new analysis of regional pollution trends done by Centre for Science and Environment (CSE). 

• Most cities in the region recorded a rising trend in annual particulate matter (PM) 2.5 level in 2021, after the initial drop during 2020 due to pandemic-linked lockdown phases.
• Cities in the region needed big cuts in annual average PM2.5 levels to meet clean air standards.

Cities covered under the Analysis

The analysis covered 29 continuous ambient air quality monitoring stations spread across 12 cities in the three states:

• West Bengal: Durgapur, a big industrial hub of West Bengal, had the most polluted air in the region in 2021, with an annual average PM2.5 level of 80 microgram per cubic metre (µg/m3).
• Bihar: Followed by Muzaffarpur and Patna, with annual average PM2.5 levels of 78 µg/m3 and 73 µg/m3 respectively.
• Odisha: The only state where Bajrajnagar and Talcher had met the annual standard with average.

Days with ‘poor’ air quality were highest in Durgapur at 71, followed by 67 in Patna, 53 in Kolkata and 51 in Howrah.

Major Findings

• Eastern India usually sees a significant increase in the amount of nitrogen dioxide (NO2) in the air of all its cities during December, compared to the previous months of November, October and September.
• NO2 levels corelate well with traffic peaks in cities

The Way Forward

• Need to scale up action across all sectors — industry, power plants, vehicles and transport, waste management, clean cooking fuel and dust control to meet the national ambient air quality standard and to prevent rebound of pollution in the region.
• This analysis of real time air quality data for the period 2019-2021 shows that the downward dip in pollution that was induced by the hard lockdown phases of the pandemic in 2020 is threatening to bounce back with the levels in 2021 already rising. But in many cases, the levels are still lower than 2019. This underscored the urgency of scaling up action across all sectors to prevent further worsening and to arrest the trend in this region.

Note: The Air Quality Index (AQI) represents 24-hour average air quality data. The air quality is considered to be ‘very poor’ when the AQI is from 301-400, according to Central Pollution Control Board (CPCB) guidelines. An AQI of 0-50 is considered ‘good’, 51-100 ‘satisfactory’, 101-200 ‘moderate’, 201-300 ‘poor’ and 401-500 ‘severe’. Above 500 is the ‘severe-plus or emergency’ category.

Can you answer the following questions?

1. After a decline in 2020 due to the COVID-19 pandemic, West Bengal, Bihar and Odisha are seeing a resurgence in pollution. Examine.

(TEST YOUR KNOWLEDGE)

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

Q.1 Which of the following is/are true regarding Khadi and Village Industries Commission (KVIC)?

1. It is a statutory body established under KVIC Act, 1956 
2. It functions under the Ministry of Commerce

Select the correct answer:

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

Q.2 Consider the following statements regarding Sea Dragon Exercise:

1. It is an exercise of Quad countries along with Canada and South Korea 
2. This exercise primarily focuses on anti-submarine warfare (ASW) training.

Which of the above is or are correct? 

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

Q.3 Which of the following state does not share a border with Myanmar ?

1. Tripura
2. Arunachal Pradesh
3. Nagaland
4. Mizoram

ANSWERS FOR 11th Jan 2022 TEST YOUR KNOWLEDGE (TYK)

Must Read

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