Part of: GS Prelims and Mains Paper III – Indian Economy
In News:
Walmart to buy control of Flipkart – $16 bn deal – largest ever Indian acquisition by a foreign firm
The deal will help Walmart (world’s largest retailer) to compete with its U.S. rival Amazon.com in a battle for dominance of India’s online marketplace.
Do you know?
Previous biggest acquisition was by Vodafone in 2007
Vodafone spent $13 billion to buy Hutchison’s Indian business
India is one of the most attractive retail markets in the world, given its size and growth rate
Important Value Additions:
Role of SEBI
Securities and Exchange Board of India (“SEBI”) regulates Mergers and Acquisitions transactions involving entities listed on recognised stock exchanges in India.
Listed public companies, unlike unlisted companies, are required to be in compliance with applicable SEBI laws and the listing regulations.
The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (in short – Takeover Code) regulates both the direct and indirect acquisition of shares, voting rights and control in listed companies that are traded over the stock market.
Part of: GS Prelims and Mains Paper II and III – Geography (Geology) and Science
In News:
World’s second oldest rock discovered in Odisha (4,240 million years old) – Singhbhum rock
Rock sample recovered from Champua in Odisha’s Kendujhar district
4.2 billion-year-old zircon in the rock offers fresh clues about the earth’s origins
Where is the first oldest rock in the world?
Oldest rock sample in the world was discovered in Jack Hill, Western Australia (4,400 million years old)
On what method the rock sample is considered as the oldest?
Scientists have found in the rock a grain of ‘magmatic zircon’ that is an estimated 4,240 million years old.
Zircon is a mineral that contains traces of radioactive isotopes.
The machine used is called Sensitive High Resolution Ion Microprobe (SHRIMP). It is not available in India.
Benefit of this discovery
Their study will add valuable information about the presence of water in the first few hundred million years of the Earth’s history. It will also give us clues to when plate tectonics began.
Clean Ganga Mission spend less than a quarter of the funds
Part of: GS Prelims and Mains III – Environment and Ecology; Water Pollution
In News:
Only about a fifth of the ₹20,000 crore allotted for the National Clean Ganga Mission (NCGM) has been utilised till March 2018.
The NMCG [National Mission for Clean Ganga] has been able to spend less than a quarter of the funds earmarked for the project in the last two financial years. (Report by CAG in 2017)
Concerns:
Government’s Ganga-cleaning exercise has come under criticism.
Government had promised a “visible change” in the Ganga water quality by 2019. However, only around 20% of Clean Ganga Mission funds have been spent till March.
Key pointers:
The Ganges passes through the states of Uttarakhand, Uttar Pradesh, Bihar, Jharkhand, and West Bengal.
Coursing 2,500 km, the Ganga is the longest river within India’s borders.
The river basin spreads across 11 States (from Uttarakhand to West Bengal)
Much of its pollution load — chemical effluents, sewage, dead bodies, and excreta — comes from the five states which are located along the river’s main stem: i.e. Uttarakhand, Uttar Pradesh, Jharkhand, Bihar and West Bengal.
Do you know?
The industrial pollutants (volume wise) accounts for about 20%. The municipal sewage accounts for 80% of the pollution load.
The industrial pollutants largely emanate from tanneries in Kanpur and distilleries, paper mills and sugar mills in the Kosi, Ramganga and Kali river catchments.
Important Value Additions:
Ganges flows through the nations of India and Bangladesh.
Source: Gangotri Glacier (Uttarakhand)
Major left-bank tributaries include Gomti (Gumti), Ghaghara (Gogra), Gandaki (Gandak), and Kosi (Kusi)
Major right-bank tributaries include Yamuna (Jumna), Son, Punpun and Damodar.
The Ganges is the third largest river in the world by discharge.
About National Mission for Clean Ganga (NMCG) and National Ganga River Basin Authority (NGRBA)
NMCG was registered as a society under the Societies Registration Act 1860.
It acted as implementation arm of National Ganga River Basin Authority (NGRBA) which was constituted under the provisions of the Environment (Protection) Act (EPA), 1986.
NGRBA has since been dissolved with effect from the 7th October 2016, consequent to constitution of National Council for Rejuvenation, Protection and Management of River Ganga (referred as National Ganga Council)
National Ganga Council is under chairmanship of Hon’ble Prime Minister of India.
Empowered Task Force (ETF) on river Ganga under chairmanship of Hon’ble Union Minister of Water Resources, River Development and Ganga Rejuvenation.
Part of: GS Prelims and Mains II and III – Art and Culture (Architecture); Environment and Ecology; Effects of Pollution; Conservation of Heritage sites and Monuments
Key Pointers:
Archaeological Survey of India (ASI) has been criticized by the SC for its lack of commitment to protect the monument.
ASI is charged with the responsibility of maintenance of the historic monument. ASI
The ASI tells Supreme Court that the numerous footfalls everyday has taken a toll on the Taj.
Unwashed socks worn by visitors and rampant algae seem to turn the Taj Mahal from its natural white to yellow, brown and green – according to ASI.
Other concerns:
River Yamuna, which used to flow nearby, has dried up.
Encroachments and industries have cropped up in the neighbourhood of the white marble mausoleum.
Marble was yellowing on account of sulphur fumes from the surrounding industries.
Important Value Additions:
Supreme Court is lauded for its constructive application of Article 142 in an effort to bring complete justice to various deprived sections of society or to protect the environment.
Article 142 provides that “the Supreme Court in the exercise of its jurisdiction may pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it…”
About Taj Mahal and its architecture:
The most important work and the pride of Mughal Architecture, built by Shah Jahan.
Entire structure is made of white marble quarried from Makrana.
It has four minarets which are made in such a way that just in case if they fall, they fall outwards and not on the central structure.
Pietra dura work has been extensively used and colourful gems have been embedded in the white marble to provide different natural and geometric motifs.
Arabesque of Quranic verses have been written in a unique way.
Part of: GS Prelims and Mains II and III – International Relations and Economy
In News:
U.S. President Donald Trump decides to pull out of the Joint Comprehensive Plan of Action (JCPOA) on Iran.
Impacts of sanctions on India:
Iran is India’s third biggest supplier (after Iraq and Saudi Arabia) of crude oil, and any increase in prices will hit both inflation levels and the rupee.
New U.S. sanctions could slow or even bring India’s plans to develop Shahid Beheshti Port in Chabahar to halt.
Plans for International North South Transport Corridor (INSTC) gathered momentum after the JCPOA was signed in 2015 and sanctions on Iran were lifted. But with new sanctions INSTC plans may slow down.
On 9 June 2017, at a summit in Astana, India and Pakistan officially joined SCO as full-fledged members.
China is considering inducting Iran into the eight-member Eurasian security organisation. If the proposal is accepted, India will become a member of a bloc that will be seen as anti-American.
India is a founder member of the 18-year-old International North South Transport Corridor (INSTC) that starts from Iran and aims to cut right across Central Asia to Russia over a 7,200-km multi-mode network.
Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests
Effect of policies and politics of developed and developing countries on India’s interests
U.S. withdrawal from Iran nuclear deal: Reason behind and Consequences
In news:
President Donald Trump recently decided to unilaterally pull the U.S. out of the Iran nuclear deal and to re-imposing nuclear sanctions against that country. It is a huge setback to multilateral diplomacy and the rules-based international order.
Iran nuclear deal (The Joint Comprehensive Plan of Action):
The agreement, signed in 2015 by Iran with the five permanent members of the UN Security Council, Germany and the EU, curtailed its nuclear programme in return for withdrawing economic sanctions. It was reached after 18 months of painful negotiations. Under the deal, most of Iran’s enriched uranium was shipped out of the country, a heavy water facility was rendered inoperable and the operational nuclear facilities were brought under international inspection.
Reason behind the decision:
Mr. Trump’s decision is not about Iran acquiring nuclear weapons. If it was the actual concern, it would have supported a deal that closes the path towards nuclear weapons for Iran. Instead, the bigger concern for Mr. Trump as well as Washington’s closest allies in West Asia — Israel and Saudi Arabia — is Iran’s re-accommodation in the global economic mainstream. They fear that if Iran’s economic profile rises, it will embolden it to increase its regional presence, posing a strategic threat to the interests of the U.S.-Saudi-Israel axis.
Iran’s response:
Iranian President Hassan Rouhani declared that his government remains committed to a nuclear deal with world powers, despite the US decision to withdraw, but is also ready to resume uranium enrichment should the new sanctions against Iran become effective. Undoubtedly, the US exit from the nuclear deal comes as a great defeat for Rouhani against the Iranian hardliners who warned him against diplomacy with the Americans.
Fallout:
In Iran, the moderate government of President Hassan Rouhani went ahead with the deal despite strong opposition from hardliners. Mr. Trump has wrecked all the efforts, despite numerous reports, including from American intelligence agencies, that Iran is 100% compliant with the terms of the agreement.
The U.S. action doesn’t necessarily trigger an immediate collapse of the agreement. For now, Europe, Russia and China remain committed to it. But the challenges will emerge, not only for Europe but also for other nations with strong trade ties with Iran, including India, once American sanctions are in place.
Trump’s decision to reinstate US nuclear-related sanctions against Iran could cripple the Iranian economy and most probably create new urban riots around the country. But, worsening domestic problems in Iran could spell widespread geo-political trouble for the whole region.
Trump’s decision could make a war scenario much more likely, unless there is a regime change in Iran, which is very unlikely.
For India:
The reintroduction of sanctions against Iran is bad news. Iran is now India’s third largest source of oil. Apart from supply disruptions, a further surge in crude prices will worsen India’s current account imbalance and fuel inflation, at a time when the economy is just beginning to show signs of returning to a high growth trajectory. For global corporations too, there will be considerable pain. For example, there are said to be around 200 French companies operating in Iran and some like Renault have plants there. They will now have a 90-day period to wind down operations. India’s Chabahar port project in Iran, which was just showing signs of moving forward, could be in trouble.
Way ahead:
The U.S. stands isolated in its decision. Europe and other powers (UN permanent members) should stick together to respect the mandate of an international agreement. Any sanctions imposed by U.S. will hurt the global economy and may force Iran to stock nuclear weapons, further complicating the situation. Thus, the need of the hour is to standby with the agreement even after the U.S. has withdrawn.
Connecting the dots:
The U.S. has unilaterally decided to withdraw from the Iran nuclear deal. Discuss the reason behind. Also, analyse the consequences of such a decision and how it would impact India.
INTERNATIONAL
TOPIC:General Studies 2:
India and its neighbourhood- relations.
Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests
Effect of policies and politics of developed and developing countries on India’s interests
Between the Elephant and the Dragon
Introduction:
Iran, one of the major exporters of oil and natural gas to India and global markets will have a tough time in exporting its natural resources.
What are the possible impacts of US’s decision to reinstate sanctions on Iran? Will it impact India’s trade relations with Iran?
Experts say sanctions on Iran will not have much impact on India’s trade relations with Iran.
However, what will impact India is the upward movement in international crude prices in the coming days, as the sanctions raise concerns that the global supply of oil will be squeezed.
If the European Union (EU) were to continue status quo and not re-impose sanctions, Iranian supplies to India will continue unhindered.
India pays its third largest oil supplier (Iran after Iraq and Saudi Arabia) in Euros using European banking channels and unless these are blocked, imports will continue.
Major concern for India: China’s role in development of the Chabahar port
Iran is attempting to woo Chinese investment in Chabahar.
Development of Chabahar port is often projected as India’s pet project (and a response to Gwadar in Pakistan)
Iran’s attempt to invite Chinese investment is perceived as an attempt to dilute Indian influence.
Key shifts:
For Iran, Chabahar means business.
Post-sanctions, the development of the Chabahar port reflects Iranian quest for multilateralism, and China by default is an important player in the Iranian scheme of things.
Given the negative ties between US and Iran, Iran will push to maintain cordial relationship with a rising power like China.
China and Iran
China is one of the few countries which never severed its ties with Iran.
China had played a crucial role in bringing Iran to the diplomatic table to negotiate the P5+1 nuclear deal.
China was also one of the countries that maintained steady trade relations with Iran even during the sanctions era.
Iran may eye for further participation in China’s connectivity projects.
A large chunk of China-Iran trade is petroleum-based products. China is the largest importer of Iranian oil.
Over the years, China has emerged as Iran’s leading trade partner.
Post-sanctions, Chinese President, Xi Jinping was the first head of state to visit Iran, in January 2016. Both countries decided to increase their bilateral trade to $600 billion in the coming decade.
Iran, with its massive infrastructural needs, sees China as its most valued partner and Beijing has been investing in Iran in crucial sectors like railways.
China International Trust and Investment Corporation (CITIC), a state owned investment wing has extended $10 billion credit line to Tehran. Besides, China Development Bank has also signed a memorandum of understanding with the Iranian government worth around $15 billion.
Chinese investments in Iran are part and parcel of its ambitious $1 trillion Belt and Road Initiative (BRI). Iran also perceives the BRI as a project that would make it an indispensable transit hub for countries like China, India and Russia and an effective antidote to the U.S. sanctions.
In addition to their economic partnership, China and Iran share substantial defence cooperation with each other. After the 1979 revolution, Tehran has been dependent on Beijing for meeting its defence requirements.
China, being permanent member of the Security Council with veto power, could be of great strategic help for Iran when it comes to vetoing any proposal against Iran in the United Nations.
A parallel, China-dominated global order suits Iran more than the U.S.-centric world order.
India’s policy options:
This strong relationship between Tehran and Beijing makes it pertinent for New Delhi to navigate its interests in the region accordingly.
To assume that Iran would help India counter Chinese influence in the region might be wishful thinking. India needs to resist the temptation of falling prey to “excessive securitisation” in the case of Chabahar agreement in particular and India-Iran relations in general.
The way ahead for India:
For India, to be an influential player in the region, economics and politics should complement and not substitute each other.
India will have to capitalise upon the existing synergies. India should offer favourable terms of trade in the region vis-à-vis China.
To consolidate its strategic depth in the region, India should focus on initiatives like frequent joint naval exercises in the Persian Gulf.
India should adopt a nuanced approach towards Chinese investment in Iran, especially now when Iran’s reliance upon China is likely to grow (with Trump’s decision to pull out of the Joint Comprehensive Plan of Action (JCPOA)).
India might also consider option of joint cooperation with China in Chabahar project. Some form of Chinese participation in the Chabahar project would be helpful for the future of the project, especially if the terms and conditions are clearly specified.
Just like how India and China are exploring joint economic projects in Afghanistan; they can also extend this engagement to the Chabahar.
Connecting the dots:
The U.S. has unilaterally decided to withdraw from the Iran nuclear deal. Discuss the reason behind. Also, analyse the consequences of such a decision and how it would impact India.
(TEST YOUR KNOWLEDGE)
Model questions: (You can now post your answers in comment section)
Q.1) Which among the following acquisition is the largest ever Indian acquisition by a foreign firm, which was in news recently?
Walmart-Flipkart deal
Amazon-Flipkart deal
Vodafone- Hutchison deal
Alibaba-Jio deal
Q.2) Consider the following statements:
The security market of India is regulated by SEBI.
SEBI regulates Mergers and Acquisitions transactions involving entities listed on recognised stock exchanges in India.
Which of the above statements is/are correct?
1 only
2 only
Both 1 and 2
None
Q.3) The world’s first oldest rock was discovered in?
Singhbhum, Odisha
Kendujhar, Odisha
Jack Hill, Australia
Both a and b
Q.4)Consider the following statements with reference to river Ganga:
The municipal sewage accounts for 20% of the pollution load.
The industrial pollutants (volume wise) accounts for about 80%.
The river basin spreads across 5 states.
Which of the statements given above is/are correct?
1 and 2 only
3 only
1, 2 and 3
None
Q.5) Which among the following are part of major left-bank tributaries of river Ganga?
Gomti
Ghaghara
Damodar
Kosi
Yamuna
Choose the correct code from the following
3 and 5
1, 2 and 3
1, 2 and 4
1, 2, 3 and 4
Q.6) Which of the statements given below is/are correct?
National Ganga Council is under chairmanship of Hon’ble Prime Minister of India.
Empowered Task Force (ETF) on river Ganga under chairmanship of Hon’ble Union Minister of Water Resources, River Development and Ganga Rejuvenation.
Choose the correct code from the following
1 only
2 only
Both
None
Q.7) Consider the following statements
India is a founder member of International North South Transport Corridor (INSTC)
India was formally admitted as member in Shanghai Cooperation Organisation last year
Which of the statements given above is/are correct?
