Daily News Analysis 25 August 2023 (The Hindu)

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Here are the topics covered for 25 August 2023: Modi-Xi Calls for Speedy Dis-engagement on LAC, E-commerce Companies, Indian Gaming Industry, Food Supply Shocks, Arctic Region, Tuberculosis, BRICS Members, Genetic Drugs in India, Black Sea Grain Initiative.

 

Table of Contents:

GS Paper 2:

  1. Modi-Xi Calls for Speedy Dis-engagement on LAC

 

GS Paper 3:

  1. E-commerce Companies
  2. Indian Gaming Industry
  3. Food Supply Shocks
  4. Arctic Region

 

Facts for Prelims:

  1. Tuberculosis
  2. BRICS Members
  3. Genetic Drugs in India
  4. Black Sea Grain Initiative

 

GS Paper 2

Modi-Xi Calls for Speedy Dis-engagement on LAC

Context

  1. On the sidelines of an ongoing BRICS summit in Johannesburg (S.Africa) Leaders of Both nations called for speedy disengagement and de-escalation of tension along with LAC.

 

India’s Concerns

  1. The PM highlighted India’s concern about unresolved issues along the LAC in the western sector of Indo-China border areas.
    1. However, there is no reference to the earlier position and maintaining the status quo.
  2. Both leaders have directed their officials to speed up the talks and efforts for de-escalation and disengagement but no timeline has been set for the disengagement and de-escalation.

 

India-China Border Dispute

  1. The line that separates both countries is known as the Mac-Mohan Line In Arunachal Pradesh and the Line of Actual Control in J&K.
  2. Both the countries have maintained their separate positions on The Jhonson line and The Macdonald line.
  3. India accepted the Jhonson line and claimed Aksai Chin as Indian Territory and China accepted the Macdonald line and claimed Aksai Chin as their part.
  4. Both countries share a total 3488 km long border and this border touches 5 states/Uts of India.
  5. India’s border is divided into 3 sectors Western, Middle, and Eastern sectors.
    1. Western Sector: It is between J&K and Xinjiang province of China and is 2152 km long. Johnson and Macdonald\’s line is situated in this sector.
    2. Middle sector: It 625 km long border located between Ladakh and Nepal.
    3. Eastern Sector: It is an 1140 km long border also known as the Mac-Mohan line and situated in the Indian state of Sikkim and Arunachal Pradesh.

 

Border Dispute Settlement Mechanism Between Both Countries:

  1. The Agreement on Maintaitennace of Peace and Tranquility: The agreement was signed in 1993 and called for renunciation of the use of force recognition of LAC and resolution of border dispute through negotiations.
  2. The Agreement on Confidence Building Measures in the Military Field along the LAC: It was signed in 1996 and laid down pledges of nonaggression, prior information for large movements of troops, and exchange of maps to resolve disagreements at LAC.
  3. Border Defence Cooperation Agreement: It was signed after the Depsang Valley incident in 2013. The two sides shall carry out border defence cooperation based on their respective laws and relevant bilateral agreements.
  4. The Core Commanders Talk: A recent talk conducted between Major Generals of both sides discussed the creation of buffer zones as part of an agreement between the 2 sides has restricted patroling by the troops. 19th Core commanders level talks concluded recently.

 

GS Paper 3

PM Modi Seeks for a level playing field for small e-commerce Companies

Context

  1. Recently PM Modi pitched for equitable competition between small and large e-commerce companies for increased participation in domestic and global markets and it is a priority of India’s G-20 Presidency.

 

More About News:

  1. The empowerment of small e-commerce will help smaller enterprises to integrate them into global supply chains.
  2. Enhancing these small enterprises in the global value chain is one of the main priorities of India under the G-20 Presidency.

 

Jaipur’s Initiative:

  1. The proposed ‘Jaipur Initiative to foster seamless flow of information to MSMEs’ will address the challenge of inadequate access to market and business-related information faced by MSMEs.
  2. MSMEs account for 60 to 70 per cent of employment and contribute 50 per cent to the global GDP.

 

E-Commerce in India:

  1. India’s social commerce has the potential to expand to US$ 16-20 billion in FY25, growing at a CAGR of 55-60%.
  2. India’s e-commerce market is expected to reach US$ 111 billion by 2024 and US$ 200 billion by 2026.
  3. India has gained 125 million online shoppers in the past three years, with another 80 million expected to join by 2025.
  4. In 2022, the Indian e-commerce market is predicted to increase by 21.5%, reaching US$ 74.8 billion.
  5. India’s e-commerce market is expected to reach US$ 350 billion by 2030.

 

Indian Gaming Industry

Context

  1. According to the All India Gaming Federation, the Indian gaming industry may face challenges with unfavourable policies, and heavy taxes.

 

Gaming Industry in India

  1. As per AIGF in India, 900 small and medium gaming companies are working hence the majority of them come under the MSME category.

 

Issues Facing by the Gaming Industry in India:

  1. Currently gaming industry is facing a 400% GST liability due to this large startups and entrepreneurs will disproportionately get impacted and may go out of business.
    1. Due to the hike in taxes, many companies have announced the closure and layoff of their workforce and this trend may increase in coming years.
    2. This situation makes companies adjust their business commitment and technical side adjustments.
  2. This will adversely impact the government’s tax revenue if online game-playing consumers move towards platforms based on offshore gaming.

 

Food Supply Shocks

Context:

  1. The Reserve Bank of India (RBI), in its recently held MPC held that continued supply-side measures essential to prevent spiralling food supply shocks.

 

Why supply-side shocks?

  1. The RBI Governor in his recent statement held that the Headline consumer price index (CPI)-based inflation is expected to harden significantly in July-August, driven by the spike in tomato and other vegetable prices.
    1. The July CPI print, which was released after the RBI policy announcement, rose to a 15-month high of 7.44 per cent in July from 4.81 per cent in June.
  2. India faces the onslaught of overlapping localised supply shocks, which are causing price-sensitive food items in the CPI to spike and push up headline inflation.
  3. While the vegetable price shocks are expected to correct quickly with the arrival of fresh crops, there are risks to the food and the overall inflation outlook from:
    1. El Nino conditions,
    2. Volatile global food prices and
    3. skewed monsoon distribution

 

RBI View:

  1. The supply-side measures need to be continued to prevent the spiralling of frequent food supply shocks into generalised economy-wide price impulses.
  2. The RBI in its recent MPC unanimously decided to keep the policy repo rate unchanged at 6.5 per cent.
  3. The RBI Governor recommended that India be ready to pre-empt any second-round impact of food price shocks on the broader inflationary pressures and risks to anchoring of inflation expectations.
  4. The softening of core inflation (CPI excluding food and fuel) by around 100 bps, from 6 per cent in Q4 of FY2023 to 5.1 per cent in Q1 FY 2024 is a source of some comfort in the face of rising food prices, although it is still at an elevated level.
  5. The RBI continuously assess the impact of its past actions, and the implications of incoming data for the evolving inflation and growth dynamics and stands in readiness to act whenever necessary.

 

Arctic Region

\"Arctic

Courtesy: Wikipedia

 

Context:

  1. Murmansk, popularly called the capital of the Arctic region and the beginning point of the Northern Sea Route (NSR), is witnessing the rising trend of Indian involvement in cargo traffic.

 

The Arctic Region significant to India

  1. The vulnerability of the Arctic region, may have an impact on India in terms of economic security, water security and sustainability.
  2. The region also constitutes the largest unexplored prospective area for hydrocarbons remaining on the earth.
  3. It is estimated that the region may hold over 40 per cent of the current global reserves of oil and gas.
  4. There may also be significant reserves of coal, zinc and silver.
  5. The government’s Arctic Policy of 2022 mentions that the country’s approach to economic development of the region is guided by UN Sustainable Development Goals.

 

India’s Engagement with the Arctic:

  1. India’s engagement with the Arctic can be traced to the signing of the Svalbard Treaty in February 1920 in Paris and India is undertaking several scientific studies and research in the Arctic region.
  2. The Treaty encompasses atmospheric, biological, marine, hydrological and glaciological studies.
  3. Apart from setting up a research station, Himadri, at Ny-Ålesund, Svalbard, in 2008, the country launched its inaugural multi-sensor moored observatory and northernmost atmospheric laboratory in 2014 and 2016 respectively.
  4. Till last year, thirteen expeditions to the Arctic were successfully conducted.
  5. In May 2013, India became an observer state of the Arctic Council along with five others including China.

 

About Northern Sea Route

  1. The Northern Sea Route (NSR), the shortest shipping route for freight transportation between Europe and countries of the Asia-Pacific region, straddles four seas of the Arctic Ocean.
  2. Running 5,600 km, the Route begins at the boundary between the Barents and the Kara seas (Kara Strait) and ends in the Bering Strait (Provideniya Bay).

 

Facts for Prelims

Tuberculosis

  1. Rajasthan became the first state to declare the panchayat areas as tuberculosis-free and announced the target to make the whole state tuberculosis-free by 2025.
  2. India has set the target of eliminating tuberculosis by 2025, five years ahead of the global target.
  3. India continues to be the largest contributor to global TB cases, there has been a decline in the number of cases in 2021.
  4. Reporting of TB cases also improved in 2021 – although it didn’t reach the pre-pandemic levels, it bounced back from the lows seen during the first year of the pandemic, according to the Global TB Report 2022.
  5. To achieve the TB elimination target of 2025, the government has taken several steps including looking for cases actively among vulnerable and co-morbid populations, screening for them at the health and wellness centres, and calling on the private sector to notify all TB cases.

 

BRICS Members

  1. The BRICS bloc of top emerging economies has taken a major step in expanding its reach and influence with the announcement that six more nations have been invited to join as new members.
  2. Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates have been invited to join as full members from January 1 2025.
  3. The bloc, which was formed in 2009 with Brazil, Russia, India and China, first expanded to admit South Africa in 2010.
  4. Before the start of its annual summit in South Africa this week, more than 40 countries had expressed interest in joining BRICS, and 23 formally applied to join.

 

Genetic Drugs in India

  1. A generic drug is a medication created to be the same as an existing approved brand name drug in dosage form, safety, strength, route of administration, quality, and performance characteristics.
  2. India has one of the highest per capita out-of-pocket expenditure countries, generic medicines will save a lot of money which can be used for other health issues.
  3. In 2008, the Government of India, started a new initiative “Jan Aushadhi” which envisaged making unbranded quality medicines available to poor people in the country at a reasonable and affordable price through retail outlets setup with the help of the government.
  4. The Medical Council of India, in an amendment to the code of conduct for doctors in October 2016, has recommended that every physician should prescribe drugs with generic names legible and he or she shall ensure that there is a rational prescription that promotes the use of generic drugs.

 

Black Sea Grain Initiative

\"Black

Courtesy: Wikipedia

  1. The Initiative on the Safe Transportation of Grain and Foodstuffs from Ukrainian ports also called the Black Sea Grain Initiative, was an agreement among Russia, Ukraine, Turkey and the United Nations (UN) during the Russian invasion of Ukraine.
  2. The Russian invasion of Ukraine in February 2022 led to a complete halt of maritime grain shipments from Ukraine, previously a major exporter via the Black Sea.
  3. Additionally, Russia temporarily halted its grain exports, further exacerbating the situation.
  4. This resulted in a rise in world food prices the threat of famine in lower-income countries, and the accusation that Russia was weaponizing food supplies.
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