DAILY CURRENT AFFAIRS IAS | UPSC Prelims and Mains Exam – 14th April 2022

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(Prelims Focus)

South Asia Economic Focus Reshaping Norms: A new Way Forward

Part of: Prelims and GS III – Economy 

Context: The World Bank released its bi-annual South Asia Economic Focus Reshaping Norms: A New Way Forward, recently.

Key highlights 

• India is projected to grow at 8% over the current fiscal year (April 1- March 31), and 7.1% over the next (2023-24) fiscal year.
• For the South Asia region, growth is expected to be slower than projected, by 1 percentage point, at 6.6% in 2022 and 6.3% next calendar year.
• This is due to Russia’s war on Ukraine, which has impacted the region, when it was already experiencing “fragile” growth, rising commodity prices, bottlenecks to supply and financial sector vulnerabilities.

News Source: TH

Quota in Promotions

Part of: Prelims and GS II – Polity and governance

Context: The Department of Personnel and Training (DoPT) has asked all Union government departments to collect data on inadequate representation of Scheduled Castes and Scheduled Tribes before implementing the policy of reservation in promotion in government offices.

Key takeaways 

• It said that following a January 28 Supreme Court judgment, the Attorney-General opined that three conditions were to be met while implementing the policy of reservation in promotions.
• These are:
  • Collection of quantifiable data regarding inadequacy of representation of Scheduled Castes and Scheduled Tribes;
  • Application of this data to each cadre separately; and
  • If a roster exists, the unit for operation of the roster would be the cadre or which the quantifiable data would have to be collected and applied in regard to the filling up of the vacancies in the roster.
• The order said that all the Ministries and departments are required to ensure that the conditions are complied with before implementing reservation in promotions and carrying out any promotions based thereon.

News Source: TH

Malcolm Adiseshiah Award

Part of: Prelims 

Context: Renowned Indian economist and political commentator Prabhat Patnaik has been named the recipient of the Malcolm Adiseshiah Award this year.

• The award is annually given by the Malcolm and Elizabeth Adiseshiah Trust to an outstanding social scientist for Distinguished Contributions to Development Studies.
• Malcolm Sathiyanathan Adiseshiah (1910 – 1994), was an Indian development economist and educator. In 1976 he was awarded the Padma Bhushan.

News Source: TH

(News from PIB)

Jallianwala Bagh

Part of: GS Prelims and Mains GS-I- Modern History

Context: India pays tributes to those martyred in Jallianwala Bagh on this day (April 13) in 1919.

• Jallianwala Bagh Massacre, also called Massacre of Amritsar was an incident on April 13, 1919, in which British troops fired on a large crowd of unarmed Indians in an open space known as the Jallianwala Bagh in Amritsar in Punjab.
• A large but peaceful crowd had gathered at the Jallianwala Bagh to protest against the arrest of pro-Indian independence leaders Dr. Saifuddin Kitchlu and Dr. Satya Pal. 
  • Dr. Saifuddin Kitchlu and Dr. Satya Pal opposed the passing of Rowlat Act in early 1919, which essentially extended the repressive wartime measures. 
• In response to the public gathering at Bagh, the British Brigadier-General R. E. H. Dyer surrounded the Bagh with his soldiers. After blocking the exit with his troops, he ordered them to shoot at the crowd, continuing to fire even as protestors tried to flee.
  • The Jallianwala Bagh could only be exited on one side, as its other three sides were enclosed by buildings.
• At least 1000 people were killed and over 1,200 other people were injured
• The ineffective inquiry by Disorders Inquiry Committee (also known as Hunters Commission) together with the initial praise for Dyer, fuelled great widespread anger against the British among the Indian populace, leading to the Non-cooperation movement of 1920–22.
• Britain never formally apologised for the massacre but expressed “regret” in 2019.

What exactly led to Jallianwala Bagh massacre?

• In 1859, the British Crown assumed direct control of the colony. Forever fearful of sedition and conspiracies, the colonial government used the opportunity offered by the First World War to introduce the Defence of India Act in 1915. The wartime legislation gave the government extraordinary powers of preventive detention, to lock up people without trial and to restrict speech, writing and movement.
• In March 1919, it introduced the Anarchical and Revolutionary Crimes Act, popularly known as the Rowlatt Act, which extended its wartime emergency powers into peacetime.
• Not long after the war began, Gandhi had returned to India after 21 years in South Africa. Gandhi was loyal to the British Empire and supported Britain in the First World War. Upon his return to India, he spent the first few years leading nonviolent struggles on local grievances.
• The news of the impending Rowlatt legislation became public, Gandhi immediately expressed his opposition and called for a nationwide general strike on April 6, 1919. He asked people to engage in nonviolent struggle, or satyagraha: Observe a daylong fast and hold meetings to demand the repeal of the legislation.
• Punjab was already heating up. The unrest was of particular concern to the British because Punjab was a vital economic and military asset. By World War I, soldiers from Punjab constituted three-fifths of the British Indian Army, which was extensively deployed in the war.

• To restore normalcy to the region, dispatched to Amritsar, General Dyer took control from the civil authorities on April 11. He issued a proclamation prohibiting public assembly and warning that such gatherings would be dispersed by force.
• On April 13, several thousand gathered in Jallianwala Bagh in defiance of General Dyer’s orders.
• General Dyer fired upon unarmed civilians. Shooting continued for ten minutes. The government estimate was 379 dead, other estimates were considerably higher.

Effects of Jallianwala Bagh massacre

• The perpetrator of the massacre, General Dyer, was honored and rewarded by the British public and this removed all illusions about benign British rule in the country.
• The brutality of massacre stunned entire nation. Gandhiji overwhelmed by atmosphere of violence withdrew movement on April 18. Mahatma Gandhi gave up the title of Kaiser-i-Hind, bestowed by the British for his work during the Boer War.
• Rabindranath Tagore, the poet and Nobel laureate, returned his knighthood in protest. Winston Churchill condemned the shooting as “monstrous.”
• Winston Churchill condemned the shooting as “monstrous.”
• Jallianwala Bagh shook faith in British justice. Hunter commission committee formed by the government on India on October 14, 1919 to inquire the events at Punjab
  • The purpose of the commission was to investigate the disturbances in Punjab, find the cause and bring measures to cope with the effects
  • According to the report submitted by the commission the action of General dyer was strongly condemned but no action was taken against him.
• Jallianwala Bagh massacre marked the beginning of the resistance against the exceptional laws of colonial governance.

Turning point in India’s Modern History

• It marked a turning point in India’s modern history, in that it left a permanent scar on Indo-British relations and was the prelude to Mahatma Gandhi’s full commitment to the cause of Indian nationalism and independence from Britain.
• After the Amritsar Massacre Gandhi became convinced that India should accept nothing less than full independence. To achieve this end, Gandhi began organizing his first campaign of mass civil disobedience against Britain’s oppressive rule.
• In December 1919, the congress session was held at Amritsar. It was attended by a large number of people, including peasants. 
• It was clear that the brutalities had only added fuel to the fire and made the people’s determination stronger to fight for their freedom and against oppression.
• Series of new revolutionary leaders justified violence and started new organisations for the execution of the same. 

Value Addition:

Examples of other such massacre or killings (on same lines of Jallianwala Bagh):

• 1942 Lidice massacre – In World War II, in Nazi-occupied Czechoslovakia, the Lidice massacre was a complete destruction of the village of Lidice, now in the Czech Republic.  Orders were passed from Adolf Hitler and Heinrich Himmler.
• 1968 My Lai massacre – The My Lai massacre was one of the most horrific incidents of violence committed against unarmed civilians during the Vietnam War. Many unarmed people were killed by the U.S. Army soldiers.

Mahavir Jayanti

Part of: GS-Prelims and GS-II – Policies and Interventions

Context: The festival is considered to be the most important one for Jains and marks the birth anniversary of Lord Mahavir.

• Lord Mahavir was one of the most charismatic and influential spiritual leaders to have walked the earth. 
• His messages of nonviolence, truth, honesty, selflessness and sacrifice are timeless and full of universal compassion. He preached the gospel of universal love and emphasized that all living beings, including plants and animals, are equal and deserved to be treated with love and respect.

We must draw inspiration from Lord Mahavir’s life, his practice of austerity, his stress on the need to adopt a positive attitude towards life and his messages of love, tolerance and peace, especially now, when humanity is facing a formidable health crisis of the spread of COVID-19 as well as the infamous war.

• Lord Mahavira was born at Kundagrama, Vaishali in present day Bihar. King Siddartha and Trishala are parents of Mahavira
• Mahavira was associated with Makari Gosala Putta for 6 years, but later departed due to serious philosophical differences. 
• Then Mahavira joined Nigrantha sect, while Makari Gosala Putta started Ajivika religion.
• After Mahavira, Jainism came under the control of 11 disciples of Mahavira, namely Ganadharas
• Associated symbol: Lion

The three principles of Jainism, also known as Triratnas (three gems), are:

• Right faith
• Right knowledge
• Right conduct

Value Additions:

• According to Mahavira, a person is born in a high or in a lower varna in consequence of the sins or the virtues acquired by him in the previous birth.
• The Hathigumpha Inscription proves that Jainism entered Orissa and probably became the state religion within 100 years of death of Mahavira.
• The teachings of the Parshvanatha are collectively known as Chaturyama. It is the the “four-fold teaching” of the Parshvanath.
• The Mahamastakabhisheka, refers to the abhiṣheka of the Jain images when held on a large scale. The most famous of such consecrations is the anointment of the Bahubali Gommateshwara Statue located at Shravanabelagola in Karnataka, India. It is an important Jain festival held once in every 12 years.
• Jainism predates Buddhism, while Buddha was older than Mahavira.
• Mahavir is considered to be 24th and the last Tirthankar.
• Through Sangha, Mahavira spread his teaching that consists of women & Men in the organized sangha. 
• There are two sect of Jainism- Svetambar (White Clad) and Digambar (Sky clad or Naked).
• First Jain Council was convened at Patliputra presided by Sthaulabhadra who was the leader of Shwetambar during 3rd century BC. It resulted in the compilation of 12 Angas replacing the lost 14 Purvas.
• Second Council – Second Jain Council was held at Vallabhi under the chairmainship of Devardhi in 521 A.D.
• What is Tirtha?

• • A Tirtha is a religious pilgrim place. 
  • Most tirths in India of any religion are based upon the banks of Rivers.
  • The idea of a Tirtha is to cross the river of human miseries.
  • A Tirthankara is a founder of a Tirtha. He achieves the enlightenment and then shows the path to others. 
  • A Tirthankara achieves Moksha or liberation at the end of his human life.

Dr. Bhimrao Ramji Ambedkar

Part of: GS-I – The Freedom Struggle – its various stages and important contributors or contributions from different parts of the country

Bhimrao Ramji Ambedkar (14 April 1891 – 6 December 1956), popularly known as Babasaheb Ambedkar, was an Indian jurist, economist, politician and social reformer who inspired the Dalit Buddhist movement and campaigned against social discrimination towards the untouchables (Dalits), while also supporting the rights of women and labour.

• He was independent India’s first law and justice minister, the principal architect of the Constitution of India, and a founding father of the Republic of India.
• Birth Anniversary: 14th April
• Mahaparinirvan Diwas: Death Anniversary of Ambedkar
• Known famously as: The Architect of Modern India
• His autobiography: Waiting for a Visa

His books:

• Annihilation of Caste – It strongly criticised Hindu orthodox religious leaders and the caste system in general, and included “a rebuke of Gandhi” on the subject.
• Who Were the Shudras? – Ambedkar tried to explain the formation of untouchables. He saw Shudras and Ati Shudras who form the lowest caste in the ritual hierarchy of the caste system, as separate from Untouchables.

Constitution of Reserve Bank of India

Based on the ideas that Ambedkar presented to the Hilton Young Commission

Ambedkar was trained as an economist, and was a professional economist until 1921, when he became a political leader. He wrote three scholarly books on economics:

1. Administration and Finance of the East India Company
2. The Evolution of Provincial Finance in British India
3. The Problem of the Rupee: Its Origin and Its Solution

Ambedkar and Untouchability

While practising law in the Bombay High Court, he tried to promote education to untouchables and uplift them. His first organised attempt was his establishment of the central institution Bahishkrit Hitakarini Sabha, intended to promote education and socio-economic improvement, as well as the welfare of “outcastes”, at the time referred to as depressed classes. 

For the defence of Dalit rights, he started five periodicals –

1. Mooknayak (the leader of the dumb, 1920)
2. Bahishkrit Bharat (Ostracized India, 1924)
3. Samta (Equality, 1928)
4. Janata (The People, 1930)
5. Prabuddha Bharat (Enlightened India, 1956)

Manusmriti Dahan Din: In a conference in late 1927, Ambedkar publicly condemned the classic Hindu text, the Manusmriti (Laws of Manu), for ideologically justifying caste discrimination and “untouchability”, and he ceremonially burned copies of the ancient text. On 25 December 1927, he led thousands of followers to burn copies of Manusmrti. Thus, annually 25 December is celebrated as Manusmriti Dahan Din (Manusmriti Burning Day) by Ambedkarites and Dalits.

Kalaram Temple movement: About 15,000 volunteers assembled at Kalaram Temple Satyagraha, making one of the greatest processions of Nashik. The procession was headed by a military band, a batch of scouts, women and men walked in discipline, order and determination to see the god for the first time. When they reached to gate, the gates were closed by Brahmin authorities.

Poona Pact: In 1932, British announced the formation of a separate electorate for “Depressed Classes” in the Communal Award.

• Gandhi fiercely opposed a separate electorate for untouchables, saying he feared that such an arrangement would divide the Hindu community. Gandhi protested by fasting while imprisoned in the Yerwada Central Jail of Poona. Following the fast, Congress politicians and activists such as Madan Mohan Malaviya and Palwankar Baloo organised joint meetings with Ambedkar and his supporters at Yerwada.
• On 25 September 1932, the agreement known as Poona Pact was signed between Ambedkar (on behalf of the depressed classes among Hindus) and Madan Mohan Malaviya (on behalf of the other Hindus). The agreement gave reserved seats for the depressed classes in the Provisional legislatures, within the general electorate.
• Due to the pact, the depressed class received 148 seats in the legislature, instead of the 71 as allocated in the Communal Award earlier proposed by British Prime Minister Ramsay MacDonald. 
• The text uses the term “Depressed Classes” to denote Untouchables among Hindus who were later called Scheduled Castes and Scheduled Tribes under India Act 1935, and the later Indian Constitution of 1950. In the Poona Pact, a unified electorate was in principle formed, but primary and secondary elections allowed Untouchables in practice to choose their own candidates.

Views of Dr. Ambedkar regarding the Indian Constitution

Ambedkar warned –

• No democratic constitution can be modelled on the Hindu tradition of state and village panchayats.

• What is the village, Ambedkar asked, but a sink of localism, a den of ignorance, narrow-mindedness and communalism?

Sets Universal values –

• The Constitution is a normative document, but the values it espouses are universal and ‘thin’. They do not reflect the belief system of one section of the population even if it is in a majority. Nor do these values dismiss the value systems of minority groups.

On Constitutional Morality –

• Dr. Ambedkar talked of constitutional morality.
• He said citizen will have deep respect or admiration for Constitution when they realize true intent of Constitution which helps them to possess freedom and rights. When they realize Constitution composes of thin conception of ‘good’ that can hold a plural and diverse people together.

Democracy is only a top-dressing for the Constitution of India

• For Ambedkar, democracy is only a top-dressing on an Indian soil which is essentially undemocratic.
• It is the institutionalisation of constitutional democracy that has changed the way Indians think of themselves in relation to each other, and in relation to the state. The Constitution has managed to inculcate democratic sensibilities and spark yearnings for more democracy, not less.

Concept of Federalism: His concept of federalism meant that the State was a federation in normalcy, but unitary in emergency.

Centre Was Made Strong: 

• In the Draft Constitution Dr. Ambedkar offered more powers to the Centre and made it strong. Some members of the constituent assembly criticized him on the ground that since Dr. Ambedkar postulated – the rights and values of each individual and the development of each province and each– village, it was contradictory of his part to make the Centre strong.
• Justifying the provisions for a strong Central authority Dr. Ambedkar said that he made the Centre strong not only to ‘save minorities from the misrule of majority’ but also “for it is only the Centre which can work for a common end and for the general interests of the country as a whole.”

Equality of Opportunity: 

• Of all the rights, Dr. Amebedkar observed “Equality of Opportunity” as the most important one. 
• Regarding the constitutional remedies, he characterize Article 32 as the very soul of the Constitution and the very heart of it. 
• To him, fundamental rights would mean establishment of equality and liberty in order to reform our social system, which is so full of inequalities discriminations, and other which conflict with our fundamental rights.

Directive Principles of State Policy: 

• The Directive Principles of State Policy contained the positive obligations of the state towards its citizens. 
• The Directives were meant to ensure social and economic democracy which was secured by the provisions of fundamental rights in a written Constitution. 
• Dr. Ambedkar said: “What are called Directive Principles is simply another name for Instruments of instructions to the legislature and the executive…as to how they should exercise their power.”

Constitution, A Dynamic Document: The Constitution is a dynamic document it should grow with the growth of the nation and should suit the changing needs and circumstance. So Dr. Ambedkar urged the necessity of amendment.

Concept of Sovereignty and Suzerainty: Dr. Ambedkar’s concept of sovereignty and suzerainty and of the Indian States, i.e., integration of the native Indian Princely States which gave the shape to the rap of India as if is today, has indeed been prophetic. 

National Integration: In the Draft Constitution Dr. Ambedkar prescribed single citizenship, a single judiciary and uniformity in fundamental Laws to integrate Indian society which was not only divided into caste and class, but also into regions, religions, languages, traditions and cultures. Therefore, a strong Centre was indispensable to maintain territorial integrity and administrative discipline.

Dr Ambedkar said – power is one thing, wisdom is quite another thing. When deciding the destiny of nations, dignities of people, dignities of leaders and dignities of parties ought to count for nothing. The dignity of the country should count for everything.

Note: Dr. Ambedkar Scheme for Social Integration through Inter-Caste Marriages (dalit)

1. Encouraging the practice of inter-caste marriages – Indian society can only develop and progress if the curse of caste inequality is removed forever. The implementation of this program is a step towards achieving this goal. 
2. Assisting young couples with money – Couples who opt for inter-caste are generally shunned by their families due to the rigidity of the caste system in India. They often face hardships, but with this grant, these couples will no longer have to worry about facing financial adversity during the initial days.
3. Funded by the central government – All operational activities and financial requirements of this welfare scheme will be met for the coffers of central government. Money will be sent to each start or UT for its implementation.
4. Bringing equality among all castes – The main aim of this scheme is to give a level ground to all castes. With this, the central government will be able to bring about equality among all castes, thereby eliminating caste related prejudices.

(Mains Focus)

ENVIRONMENT/ ECONOMY/ GOVERNANCE

• GS-3: Conservation, environmental pollution and degradation 
• GS-3: Indian Economy and its challenges
• GS-2: Government policies and interventions for development in various sectors and issues arising out of their design and implementation 

India’s solar power energy targets

Context: Recent reports indicate that India is likely to miss its 2022 target of installing 100 gigawatts (GW) of solar power capacity. 

What is India’s solar policy?

• Since 2011, India’s solar sector has grown at a compounded annual growth rate (CAGR) of around 59% from 0.5GW in 2011 to 55GW in 2021. 
• The Jawaharlal Nehru National Solar Mission (JNNSM), also known as the National Solar Mission (NSM), which commenced in January 2010, marked the first time the government focussed on promoting and developing solar power in India. 
  • Under the scheme, the total installed capacity target was set as 20GW by 2022.
  • In 2015, the target was revised to 100GW and in August 2021, the government set a solar target of 300GW by 2030.
• India currently ranks fifth after China, U.S., Japan and Germany in terms of installed solar power capacity. 
• As of December 2021, the cumulative solar installed capacity of India is 55GW, which is roughly half the renewable energy (RE) capacity (excluding large hydro power) and 14% of the overall power generation capacity of India. 
• Within the 55GW, grid-connected utility-scale projects contribute 77% and the rest comes from grid-connected rooftop and off-grid projects.

What is the shortfall expected in meeting the target?

• As of April, only about 50% of the 100GW target, consisting of 60GW of utility-scale and 40GW of rooftop solar capacity, has been met. 
• Nearly 19 GW of solar capacity is expected to be added in 2022 — 15.8GW from utility-scale and 3.5GW from rooftop solar. 
• Even accounting for this capacity would mean about 27% of India’s 100GW solar target would remain unmet.
• A 25GW shortfall in the 40GW rooftop solar target, is expected compared to 1.8GW in the utility-scale solar target by December 2022. Thus, it is in rooftop solar that the challenges of India’s solar-adoption policy stick out.

What are the reasons for rooftop solar adoption not meeting targets and what does the future hold?

• In December 2015, the government launched the first phase of the grid-connected rooftop solar programme to incentivise its use in residential, institutional and social areas. 
• The second phase, approved in February 2019, had a target of 40GW of cumulative rooftop solar capacity by 2022, with incentives in the form of central financial assistance (CFA). 
• As of November 2021, of the phase 2 target of 4GW set for the residential sector, only 1.1GW had been installed. 
• The disruption in supply chains due to the pandemic was a key impediment to rooftop solar adoption.
• In its early years, India’s rooftop solar market struggled to grow due to 
  • lack of consumer awareness
  • inconsistent policy frameworks of the Centre/ State governments 
  • Issues of financing. 
• Recently, however, there has been a sharp rise in rooftop solar installations thanks to falling technology costs, increasing grid tariffs, rising consumer awareness and the growing need for cutting energy costs. These factors are expected to persist giving a much-needed boost to this segment. 
• Going ahead, rooftop solar adoption is expected to proportionally increase as land and grid-connectivity for utility solar projects are expected to be hard to come by. 
• Factors impeding rooftop-solar installation include 
  • pandemic-induced supply chain disruption to policy restrictions
  • regulatory roadblocks
  • limits to net-metering (or paying users who give back surplus electricity to the grid)
  • taxes on imported cells and modules
  • unsigned power supply agreements (PSAs) 
  • banking restrictions
  • financing issues 
  • delays in or rejection of open access approval grants
  • unpredictability of future open access charges

How critical is solar power to India’s commitment to mitigate climate change?

• Solar power is a major strategy of India’s commitment to address global warming according to the terms of the Paris Agreement, as well as achieving net zero, or no net carbon emissions, by 2070.
• Prime Minister Modi at the United Nations Conference of Parties meeting in Glasgow, in November 2021, said India would be reaching a non-fossil fuel energy capacity of 500 GW by 2030 and meet half its energy requirements via renewable energy by 2030.
• To boost the renewable energy installation drive in the long term, the Centre in 2020 set a target of 450GW of RE-based installed capacity to be achieved by 2030, within which the target for solar was 300GW. 
• Given the challenge of integrating variable renewable energy into the grid, most of the RE capacity installed in the latter half of this decade is likely to be based on wind solar hybrid (WSH), RE-plus-storage and round-the-clock RE projects rather than traditional solar/wind projects. 
• On the current trajectory, it is expected that the India’s solar target of 300GW by 2030 will be off the mark by about 86GW, or nearly a third.
• It is speculated that that the government, in the short-term, will aggressively push for expediting solar capacity addition to achieve the 100GW target by 2022 by re-allocating some of the unmet rooftop targets to utility-scale projects.

Connecting the dots:

• International Solar Alliance
• Paris Climate Deal & India’s progress
• Glasgow Summit: Achievements & Disappointments
• IPCC report on Climate Change

INTERNATIONAL/ ECONOMY

• GS-2: India and its neighborhood- relations. 

Nepal’s Forex Challenges

Context: In an unusual development, the government of Nepal sacked the head of its central bank accusing him of leaking sensitive information and for failing to perform his duties. 

• The decision, which violates the autonomy of Nepal Rastra Bank (NRB), was taken in the backdrop of tense relations between Finance Minister and NRB head over how to address Nepal’s crisis of falling forex reserves. 
• It was reported that the country’s forex reserves have plummeted by 18.5% to $9.58 billion in March from $11.75 billion in July 2021. The current forex reserves are enough to pay the government’s import bills only for the next seven months or so.

How bad is the situation? 

• Nepal’s economy is highly dependent on imports as the country buys a range of merchandise goods apart from fuel. 
• Nepal’s forex reserves situation appears healthy as of now as the country, unlike Sri Lanka, is not burdened by external debt. 
• There are, however, concerns that the lower middle income economy is being battered repeatedly by external factors and that may precipitate a crisis sometime soon. 
• Nepal which is blessed with one of the finest tourism sectors in South Asia, because of the Himalayan mountain range, suffered during the COVID-19 pandemic as global tourist flow fell. 
• This was followed by the global energy crisis caused by Russia’s invasion of Ukraine. This has put extraordinary inflationary pressure on the economy
  • It is expected that if current trends continue then double-digit inflation will hit Nepal by June/July 2022 as the current rate of inflation is 7.14%. 
• All economic indicators are declining and the real shortfall in forex reserves is because of the decline in foreign remittances which suffered during the pandemic when the Nepalese work force abroad suffered job losses. 

• The situation has not stabilised and Nepal’s forex reserves continue to slide. The prevailing weak economic indicators mean that Nepal is spending from its forex reserves faster than it can save. 
• Nepal has enough forex for buying merchandise just over seven months. This does not look good as Nepal also has a balance of trade crisis with major partners.

Can the energy scene in Nepal escalate economic woes?

• Nepal’s primary supplier of energy is Indian Oil Corporation (IOC). Nepal Oil Corporation (NOC) pays IOC in two instalments every month, on the 8th and the 23rd. 
• The NOC has been in crisis for months as high global prices depleted the company’s savings, prompting it to approach the government for a lifeline. 
• The Government of Nepal has agreed to provide NOC the necessary amount to continue supplies from IOC. For the time being sufficient funds have been allocated to NOC to pay IOC for the next instalment. 
• However, NOC’s financial status makes it unattractive for banks and as a result the public sector company does not enjoy confidence in the market. 
• There is a need to protect NOC from the effects of the current energy crisis in the world which has erupted after the Ukraine crisis. 
• Nepal’s history shows that any uncertainty regarding fuel can trigger serious internal problems as was visible during the 2015-16 blockade when disruption of fuel supply from India caused distress in Nepal. 

Will the economic situation have an impact on upcoming elections?

• Nepal will hold local level polls on May 13 which will be followed by general elections towards the end of 2022. 
• The election process requires considerable financial allocation and Nepal has received support in the past for elections from international donors like the USAID. 
• These donors help in carrying out pre-election staff training and logistics that are part of any democratic process. 
• But there are uncertainties about such international support because of the difficulties that most of the traditional partners are facing. 
• Election Commission of Nepal will require at least 10 billion Nepali rupees for the election process and that will mean diversion of a large amount of resources for the democratic process. 

Connecting the dots:

• Sri Lanka Economic Crisis
• India-Nepal border dispute: Kalapani and Lipulekh
• India-Nepal relations needs a reset

(TEST YOUR KNOWLEDGE)

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

Q.1 Malcolm Adiseshiah Award is awarded for which of the following?

1. Development Studies
2. Historical research
3. Social service
4. Fighting militants 

Q.2 South Asia Economic Focus Reshaping Norms is published by which of the following?

1. World Bank 
2. UNESCO 
3. WTO
4. IMF

Q.3 When did Jallianwala Bagh massacre take place?

1. 13th April
2. 14th April
3. 15th April
4. 16th April

ANSWERS FOR 14th April 2022 TEST YOUR KNOWLEDGE (TYK)

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