Current Affairs Daily Current Affairs 22

4th March,2022 ; Daily Current Affairs

Daily Current Affairs   Date : 4thMarch,2022

 (30+ Questions hit in Prelims 2021 from this series)

Covers 4 Most relevant Sources

  • The Hindu
  • Indian Express
  • PIB
  • Mint

Index

  • Quadrilateral Security Dialogue (Quad) (TH, pg 1)
  • Raising and Accelerating MSME Performance (RAMP) Programme (PIB)
  • International Telecommunication Union (ITU) (PIB)
  • Fifth United Nations Environment Assembly (UNEA 5.2) (PIB)
  • National and State Disaster Response Fund (PIB)
  • SARAS: Experiment and Science (PIB)
  • Duration of Local Bodies (TH, pg 1)
  • State Legislature’s Power to Split Capital (TH, pg 1)
  • Asian Infrastructure Investment Bank (AIIB) (TH, pg 13)
  • Fiscal Deficit and Other Economy Related Terms (TH, pg 14)
  • Operation Ganga (TH, pg 1)
  • Sagar Parikrama(PIB)

 

  1. Quadrilateral Security Dialogue (Quad) (TH, pg 1)

  • Context:Prime Minister of India participated today at a virtual summit of Quad leaders.

Analysis

  • The Quadrilateral Security Dialogue(QSD, also known as the Quad) is an informal strategic dialogue between the United States, Japan, Australia and India.
  • The dialogue was initiated in 2007 by Prime Minister Shinzo Abe of Japan.
  • The idea of the Quad was born in 2007, but was shelved when former Australian Prime Minister Kevin Rudd withdrew his country’s participation.
  • The Quad made a comeback in November 2017 with a formal consultation meeting in Manila involving the four countries.
  • The upgradation of the Quad, a consultative forum of India, Australia, Japan and the United States, to the ministerial level is a good move.

Do you know? Western Quad

  • The western Quad consisting of Israel, India, UAE and the United States has been a regional factor ever since it was convened in October 2021 which was followed by a ministerial meeting of the four countries.

 

  1. Raising and Accelerating MSME Performance (RAMP) Programme (PIB)

  • Context: Raising and Accelerating MSME Performance (RAMP) programmehas been one of the initiatives by the government to revitalize micro, small and medium enterprises in the post-Covid world.

Analysis

What is RAMP

  • RAMP is a scheme of the Ministry of Micro, Small & Medium Enterprises in partnership with the World Bank for five years – FY22 to FY26 to boost productivity and financing for Covid-hit MSMEs.
  • The programme was launched on the basis of the recommendations from the UK Sinha Committee report in June 2019.
  • Importantly, RAMP is the second programme by the World Bank for MSMEs that was approved in June 2021.
  • The first programme Emergency Response Program for Micro, Small, and Medium Enterprises had targeted to address the immediate liquidity needs of around 1.5 million MSMEs.
  • The credit was routed through targeted guarantees to incentivize non-banking financial companies (NBFCs) and banks to lend to viable MSMEs.
  • RAMP will focus on five first mover’ statesGujarat, Maharashtra, Punjab, Rajasthan, and Tamil Nadu that are home to reportedly 54 per cent of all registered MSMEs in the country.

 

  1. International Telecommunication Union (ITU) (PIB)

  • Context: India signed the Host Country Agreement (HCA) with the International Telecommunication Union (ITU) for the establishment of an Area Office & Innovation Centre of ITU in New Delhi.

Analysis

  • The International Telecommunication Union (ITU) is the United Nations specialized agency for information and communication technologies – ICTs.
  • Founded in 1865 to facilitate international connectivity in communications networks, it:
  • allocates global radio spectrum and satellite orbits,
  • develops the technical standards that ensure networks and technologies seamlessly interconnect, and
  • strives to improve access to ICTs to underserved communities worldwide.
  • ITU’s global membership includes 193 Member States as well as some 900 companies, universities, and international and regional organizations. ​
  • ITU is a unique platform for global public-private partnerships.

Do you know?

  • India has made it to the top 10 in Global Cybersecurity Index (GCI) 2020 by the International Telecommunication Union (ITU), moving up 37 places to rank as the tenth best country in the world on key cybersafety parameters.

 

  1. Fifth United Nations Environment Assembly (UNEA 5.2) (PIB)

  • Context:At the fifth United Nations Environment Assembly (UNEA) in Nairobi, Kenya, in March 2022, more than 170 countries pledged to establish an Intergovernmental Negotiating Committee that will develop an international, legally binding agreement to end plastic pollution by 2024.

Analysis

  • The UNEA resolution to tackle plastic pollution will pertain to marine ecosystems as well and include both binding and voluntary approaches from member states to curb plastic pollution.
  • It aims to address the entire lifecycle of plastic, from sustainable production and consumption to “environmentally sound” waste management.
  • The resolution also mentions that countries should take into account “national circumstances” and capabilities while implementing national-level actions to address plastic pollution.
  • This was included in the text of the resolution to allow developing countries to follow their development trajectories on India’s insistence.
  • The overall theme for UNEA-5 was “Strengthening Actions for Nature to Achieve the Sustainable Development Goals.”

United Nations Environment Assembly (UNEA)

  • Hosted by the UN Environment Programme, the United Nations Environment Assembly (UNEA) brings together representatives of the 193 Member States of the UN, businesses, civil society and other stakeholders to agree on policies to address the world’s most pressing environmental challenges.

 

  1. National and State Disaster Response Fund (PIB)

  • Context:The High Level Committee (HLC) under the Chairmanship of the Union Home Minister has approved additional Central assistance under the National Disaster Response Fund (NDRF) to five States and one Union Territory, which were affected by floods/ landslides during 2021.

Analysis

National Disaster Response Fund

  • The National Disaster Response Fund (NDRF), constituted under the Disaster Management (DM) Act, 2005, supplements the State Disaster Response Fund (SDRF).
  • NDRF acts as supplementary fund in case of shortage of funds in the SDRF and when the disaster is of severe nature.
  • The financial assistance from NDRF is for providing immediate relief (emergency response, relief and rehabilitation) and is not compensation for loss/damage to properties /crops.
  • The provision for disaster preparedness, restoration, reconstruction and mitigation are not a part of NDRF.
  • The DM Act specifies that for such activities a separate fund called Disaster Mitigation Fund has to be constituted.
  • In the absence of a Disaster Mitigation Fund, such activities have to be borne out of the budget of the state government concerned.
  • The NDRF is financed through the levy of a cess on certain items, chargeable to excise and customs duty, and approved annually through the Finance Bill.
  • The requirement for funds beyond what is available under the NDRF is met through general budgetary resources.
  • The National Calamity Contingency Fund (NCCF) (NCCF has been merged with National Disaster Response Fund (NDRF) with effect from 1 April 2010 and has ceased to exist) is replenished through the National Calamity Contingent Duty imposed on cigarettes, pan masala, beedis, other tobacco products and cellular phones.
  • The National Calamity contingent duty (NCCD) which was applied on tobacco products  — cigarettes, bidis and smokeless — pre-GST continue to apply post-GST as well.
  • A provision also exists in the DM Act to encourage any person or institution to make a contribution to the NDRF. However, this source has not yet been tapped.
  • NDRF is located in the “Public Accounts” of Government of India under “Reserve Funds not bearing interest”.
  • Department of Agriculture and Cooperation under Ministry of Agriculture (MoA) monitors relief activities for calamities associated with drought, hailstorms, pest attacks and cold wave/frost while rest of the natural calamities are monitored by Ministry of Home Affairs (MHA).
  • Comptroller and Auditor General of India (CAG) audits the accounts of NDRF.
  • In case of any natural calamity beyond the coping capacity of a State, additional financial assistance, as per norms, is provided by the Central Government from NDRF, in which 100% funding is by the Central Government.
  • Based on the recommendations of successive Finance Commission, Government of India approves the annual allocation to SDRF.

Structure of Public Account

  • There are five major heads of accounts under the Public Account: (i) Small Savings, Provident Fund and Other Accounts (ii) Reserve Funds (iii) Deposits and Advances (iv) Suspense and Miscellaneous and (v) Remittances.

State Disaster Response Fund

  • The State Disaster Response Fund (SDRF), constituted under the Disaster Management Act, 2005, is the primary fund available with State Governments for responses to notified disasters.
  • The Central Government contributes 75% of SDRF allocation for general category States/UTs and 90% for special category States/UTs (NE States, Sikkim, Uttarakhand, Himachal Pradesh, Jammu and Kashmir).
  • The annual Central contribution is released in two equal instalments as per the recommendation of the Finance Commission.
  • SDRF shall be used only for meeting the expenditure for providing immediate relief to the victims.
  • Disasters covered under SDRF: Cyclone, drought, earthquake, fire, flood, tsunami, hailstorm, landslide, avalanche, cloudburst, pest attack, frost and cold waves.
  • Local Disaster: A State Government may use up to 10 percent of the funds available under the SDRF for providing immediate relief to the victims of natural disasters that they consider to be ‘disasters’ within the local context in the State and which are not included in the notified list of disasters of the Ministry of Home Affairs.
  • It is subjected to the condition that the State Government has listed the State specific natural disasters and notified clear and transparent norms and guidelines for such disasters with the approval of the State Authority, i.e., the State Executive Authority (SEC).
  • Heatwave-calamities are not included in the guidelines of SDRF and National Calamity Relief Fund (NDRF) but State government can declare it by using the above-mentioned provision.

 

  1. SARAS: Experiment and Science (PIB)

  • Context: In 2018 a team of researchers from Arizona State University (ASU) and MIT in the US detected a signal from stars emerging in the early universe using data from the EDGES radio telescope.
  • Utilising the indigenously invented and built SARAS 3 radio telescope, researchers from Raman Research Institute, an autonomous institute of the Department of Science & Technology, Govt. of India refuted this claim.

Analysis

  • The SARAS 3 radio telescope invented and built by the astronomers at RRI is the first telescope worldwide to reach the required sensitivity.
  • The signal claimed to have been detected by the ASU/MIT team required exotic and non-standard physics and caused astrophysicists worldwide to invent new theories, which are all now redundant.
  • SARAS is an attempt to design, build and deploy in India a precision radio telescope to detect extremely faint radio wave signals from the depths of time, from our “Cosmic Dawn” when the first stars and galaxies formed in the early Universe.
  • It is one of the most sensitive instruments in the world in this field of research today.

 

  1. Duration of Local Bodies (TH, pg 1)

  • Context:After the Supreme Court refused to accept the interim report filed by the Maharashtra State Backward Classes Commission recommending 27% reservation for OBCs in local bodies, the State Cabinet passed a resolution to not hold polls till the quota is restored.

Analysis

  • The 73rd / 74th Amendment Act of 1992 provides for a five-year term of office to the panchayat at every level / every municipality.
  • However, it can be dissolved before the completion of its term.
  • Further, fresh elections to constitute a panchayat / municipality shall be completed
  • (a) before the expiry of its duration of five years; or
  • (b) in case of dissolution, before the expiry of a period of six months from the date of its dissolution.
  • But, where the remainder of the period (for which the dissolved panchayat / municipality would have continued) is less than six months, it shall not be necessary to hold any election for constituting the new panchayat / municipality for such period.
  • Moreover, a panchayat / municipality constituted upon the dissolution of a panchayat / municipality before the expiration of its duration shall continue only for the remainder of the period for which the dissolved panchayat / municipality would have continued had it not been so dissolved.
  • In other words, a panchayat / municipality reconstituted after premature dissolution does not enjoy the full period of five years but remains in office only for the remainder of the period.
  • The 74th Amendment Act of 1992 also makes two more provisions with respect to dissolution:
  • (a) a municipality must be given a reasonable opportunity of being heard before its dissolution; and
  • (b) no amendment of any law for the time being in force shall cause dissolution of a municipality before the expiry of the five years term.

 

  1. State Legislature’s Power toSplit Capital (TH, pg 1)

  • Context:In a significant observation, the Andhra Pradesh High Court held that the State legislature lacked the competence to make any legislation for shifting, bifurcating or trifurcating the capital.It also instructed the government to develop Amaravati as the capital city within six months.
  • The Court ruled that Parliament alone is competent to deal with the setting up of legislature, executive and judicial organs of the state, and this was implicit in the language employed in Article 4 of the Constitution.

Analysis

Three Capitals

  • Andhra Pradesh government wanted to establish three capitals (Amaravati, Visakhapatnam and Kurnool as legislative, executive and judicial capitals) for balanced development of all regions in Andhra Pradesh.
  • Andhra Pradesh has borrowed the idea of three decentralised capitals from South Africa.Three cities serve as capitals of the country– Pretoria (executive), Cape Town (legislative), and Bloemfontein (judicial).
  • In South Africa, the unique feature of its trio of capitals arose out of the settlement at the end of the second Anglo-Boer War.
  • Several countries in the world have implemented the concept.
  • In Sri Lanka, Sri Jayawardenepura Kotte is the official capital and seat of national legislature, while Colombo is the de facto seat of national executive and judicial bodies.
  • Malaysia has its official and royal capital and seat of national legislature at Kuala Lumpur, and Putrajaya is the administrative centre and seat of national judiciary.
  • Among Indian states, Maharashtra has two capitals– Mumbai and Nagpur (which holds the winter session of the state assembly).
  • Himachal Pradesh has capitals at Shimla and Dharamshala (winter).
  • The former state of Jammu & Kashmir had Srinagar and Jammu (winter) as capitals.

Formation of New State or UT

  • Articles 1 to 4 under Part-I of the Constitution deal with the Union and its territory.
  • Article 1 describes India, that is, Bharat as a ‘Union of States’ rather than a ‘Federation of States’. This provision deals with two things: one, name of the country; and two, type of polity.
  • According to Dr. B.R. Ambedkar, the phrase ‘Union of States’ has been preferred to ‘Federation of States’ for two reasons:
  • one, the Indian Federation is not the result of an agreement among the states like the American Federation; and
  • two, the states have no right to secede from the federation.
  • Thus, Indian federation is a Union because it is indestructible.
  • The country is an integral whole and divided into different states only for the convenience of administration.
  • According to Article 1, the territory of India can be classified into three categories:
  • 1. Territories of the states
  • 2. Union territories
  • 3. Territories that may be acquired by the Government of Indiaat any time.
  • The names of states and union territories and their territorial extent are mentioned in the first schedule of the Constitution.
  • At present, there are 28 states and 8 union territories.
  • The Union Territories of Daman and Diu, Dadra and Nagar Haveli have become a single union territory recently through a Bill passed by the Parliament in the winter session.
  • With the merger of Daman and Diu, and Dadra and Nagar Haveli, the number of UT’s have come down to eight.
  • Article 2 empowers the Parliament to ‘admit into the Union of India, or establish, new states on such terms and conditions as it thinks fit’.
  • Thus, Article 2 grants two powers to the Parliament:
  • (a) the power to admit into the Union of India new states; and
  • (b) the power to establish new states.
  • The first refers to the admission of states which are already in existence, while the second refers to the establishment of states which were not in existence before.
  • Note:Article 2 relates to the admission or establishment of new states that are not part of the Union of India.
  • Article 3, on the other hand, relates to the formation of or changes in the existing states of the Union of India.
  • In other words, it deals with the internal re-adjustment inter se of the territories of the constituent states of the Union of India.
  • Article 3 authorises the Parliament to:
  • (a) form a new state by separation of territory from any state orby uniting two or more states or parts of states or by uniting
  • any territory to a part of any state;
  • (b) increase the area of any state;
  • (c) diminish the area of any state;
  • (d) alter the boundaries of any state; and (e) alter the name of any state.
  • Article 3 lays down two conditions in this regard:
  • A bill contemplating the above changes can be introduced in the Parliament only with the prior recommendation of the President.
  • And before recommending the bill, the President has to refer the same to the state legislature concerned for expressing its views within a specified period.
  • The President (or Parliament) is not bound by the views of the state legislature and may either accept or reject them, even if the views are received in time.
  • Note: the power of Parliament to form new states includes the power to form a new state or union territory by uniting a part of any state or union territory to any other state or union territory.
  • Further, it is not necessary to make a fresh reference to the state legislature every time an amendment to the bill is moved and accepted in Parliament.
  • In case of a union territory, no reference need be made to the concerned legislature to ascertain its views and the Parliament can itself take any action as it deems fit.

Important points to be memorised

  • Constitution authorises only the Parliament to form new states or alter the areas, boundaries or names of the existing states without their consent.
  • The territorial integrity or continued existence of any state is not guaranteed by the Constitution.
  • Therefore, India is rightly described as ‘an indestructible union of destructible states’.
  • The Union Government can destroy the states whereas the state governments cannot destroy the Union.
  • Constitution of India (Article 4) itself declares that laws made for admission or establishment of new states (under Article 2) and formation of new states and alteration of areas, boundaries or names of existing states (under Articles 3) are not to be considered as amendments of the Constitution under Article 368.
  • This means that such laws can be passed by a simple majority and by the ordinary legislative process.

 

  1. Asian Infrastructure Investment Bank (AIIB) (TH, pg 13)

  • Context:The Beijing-based Asian Infrastructure Investment Bank (AIIB) has said it was putting on hold and reviewing all projects in Russia and Belarus.
  • The move comes amid sweeping sanctions and other financial measures aimed at Russia from a number of countries over its invasion of Ukraine.
  • Belarus is also a member of the bank, which is headed by China’s Jin Liqun. Former Reserve Bank of India (RBI) Governor Urjit Patel is a Vice-President of the bank.

Analysis

  • The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank with a mission to improve social and economic outcomes in Asia.
  • Headquartered in Beijing, it began operations in January 2016 and have now grown to approx. 103 approved members worldwide (Aug 2020).
  • By investing in sustainable infrastructure and other productive sectors in Asia and beyond, it aims to better connect people, services and markets.

What is the nature of AIIB’s membership?

  • AIIB is open to shareholders who are dedicated to promoting economic and social development acrossAsia and beyond.
  • Its membership is open to members of the International Bank for Reconstruction and Development or the Asian Development Bank.

Are there any specific features that differentiate AIIB from the other multilateral development banks (MDBs)?

  • Projects can be based in any member shareholder, as long as the project will deliver benefits to the Asian region.
  • All financings must meet the conditions set out in AIIB’s Environmental and Social Framework (ESF), which ensures that all projects are contributing to sustainable development.
  • AIIB has not put any hard limits on investments by sector as long as AIIB’s risk exposure remains within allowed limits.
  • The only hard limits it maintains on lending are:
  • 1) no single country exposure may be more than 50 percent of total available capital, and
  • 2) the sum of the top three country exposures may not account for more than 90 percent of total available capital.
  • In terms of sectors, it expects investments will be made mainly in the energy, transport and urban/water sectors.
  • AIIB is a US Dollar-based institution and its first public benchmark bond was issued in USD in May 2019.

What currencies are available for AIIB Local Currency Loans?

  • As of September 2019
  • Indian Rupee
  • Indonesian Rupiah
  • Thai Baht
  • Turkish Lira
  • Russian Ruble etc.
  • AIIB will continue to add currencies, which will include both major non-USD hard currencies and local currencies based on AIIB’s ability to fund itself in those currencies
  • Some observers stubbornly perceive the AIIB as a crucial part of the Belt and Road Initiative, a rather strange conclusion given that AIIB projects are often not showcased as elements of BRI (India is the best example here).
  • The country with the biggest vote share in the institution is China (26.65 percent), followed by India (7.65 percent), Russia (6.06 percent), Germany (4.2 percent), and South Korea (3.54 percent).

Board of Governors

  • All powers of the Bank are vested in the Board of Governors, which is the highest decision-making body under the Articles of Agreement.
  • The Board of Governors consists of one Governor and one Alternate Governor appointed by each member country.

Permanent Observer Status in the United Nations

  • In 2018, AIIB was granted Permanent Observer status in the deliberations of both the United Nations General Assembly and the Economic and Social Council, the two development-focused principal organs of the global body.

Core values

  • Lean, Clean and Green.
  • Any AIIB member can submit a proposal for funding.
  • AIIB can also lend to members beyond Asia if the project delivers a clear benefit to the region.
  • Reservations about environmental and ethical standards, China’s motives in launching the bank, and the AIIB’s potential to compete with the World Bank and the Asian Development Bank (ADB) had dissuaded the U.S. and Japan from becoming founding members.
  • Although most of the shareholders were in Asia, Brazil, Egypt, and South Africa were quick to join.
  • The U.K., which became a member in March 2015, was soon followed by other Western countries, notably Australia, France, Germany, Italy, and Spain.
  • China announced the AIIB in 2015, with 57 countries as founding members.
  • Canada’s decision to join the bank in 2017 left the U.S. and Japan as the only Group of Seven (G7 – Canada, U.S., U.K., Italy, France, Germany and Japan)
  • Some notable western countries which are members of AIIB: U.K., Australia, France, Germany, Italy, Spain etc.
  • Among the attractions for the founding members was the fact that the U.S. dollar was the currency of the AIIB, and the bank’s business was to be conducted in the English language.
  • India was among the AIIB’s 57 founding members(37 regional and 20 nonregional)in 2016. India is also one of the largest recipients of funds from the multilateral agency, both in the government sector and the private sector.

 

  1. Fiscal Deficit and Other Economy Related Terms (TH, pg 14)

  • Context:India’s trade deficit, which shot back up to $21.2 billion in February, is expected to stay elevated in the coming months and the current account deficit could widen to 2.6% of GDP in 2022-23, from 1.7% this year, according to a report.
  • The surge in oil prices, amid a pickup in domestic demand, will significantly enhance India’s import bill, aided by the broader rise in commodities and fertilizers and an anticipation that gold imports will remain high as investors look to hedge against market volatility and inflation.
  • The situation is ‘especially aggravated by the ongoing Russia-Ukraine conflict.
  • Russia accounts for just 0.8% of India’s exports but risks to export demand would increase if the slowdown in Russia’s economy has ripple effects.
  • Pharmaceutical products, telecom instruments, iron & steel and marine products comprise the bulk of India’s exports to the Commonwealth of Independent States (CIS) region.

Analysis

  • Fiscal Deficit(FD)is the difference between the total non-debt creating receipts(the Revenue Receipts plus Non-Debt Capital Receipts (NDCR)) and the total expenditure.
  • The difference between the total expenditure of Government by way of revenue, capital and loans net of repayments on the one hand and revenue receipts of Government and capital receipts which are not in the nature of borrowing but which accrue to Government on the other, constitutes gross fiscal deficit.
  • FD is reflective of the total borrowing requirement of Government.
  • Net fiscal deficitcan be arrived at by deducting net domestic lending from gross fiscal deficit.
  • Revenue Deficit refers to the excess of revenue expenditure over revenue receipts.
  • Revenue deficit signifies that government’s own earning is insufficient to meet normal functioning of government departments and provision of services.
  • An increase in the ratio of revenue deficit to gross fiscal deficit indicates an increase in the utilization of borrowed funds for revenue purposes.
  • It indicates increase in liabilities of the Central Government without increase in the assets of that Government.
  • The difference between fiscal deficit and revenue deficit is the government’s capital expenditure.
  • Effective Revenue Deficit
  • In the 2012-13 budget, the concept of effective revenue deficit was introduced that excluded grants for the creation of capital assets from conventional revenue deficit.
  • Effective Revenue Deficit is the difference between revenue deficit and grants for creation of capital assets.
  • Grants for creation of capital assets are defined as “the grants-in-aid given by the Central Government to the State Governments, constitutional authorities or bodies, autonomous bodies and other scheme implementing agencies for creation of capital assets which are owned by the said entities”.
  • The concept of effective revenue deficit has been suggested by the Rangarajan Committee on Public Expenditure.
  • It is aimed to deduct the money used out of borrowing to finance capital expenditure.
  • The concept has been introduced to ascertain the actual deficit in the revenue account after adjusting for expenditure of capital nature.
  • Focusing on this will help in reducing the consumptive component of revenue deficit and create space for increased capital spending.
  • Trade deficit: A nation has a trade deficit if the total value of goods and services it imports is greater than the total value of those it exports.
  • Primary Deficit: It is the difference between the current year’s fiscal deficit (total income – total expenditure of the government) and the interest paid on the borrowings of the previous year.
  • Primary Deficit = Fiscal Deficit (Total expenditure – Total income of the government) – Interest payments (of previous borrowings).
  • Fiscal deficit is also defined as the difference between the total expenditure of the government and its total income.
  • What does Primary Deficit indicate?Primary deficit is measured to know the amount of borrowing that the government can utilize, excluding the interest payments.
  • A decrease in primary deficit shows progress towards fiscal health.
  • Note that the difference between the primary deficit and fiscal deficit reflects the amount of interest payment on public debt generated in the past.
  • Hence, when the primary deficit is zero, the fiscal deficit becomes equal to the interest payment. This means that the government has resorted to borrowings just to pay off the interest payments. Further, nothing is added to the existing loan.
  • Budget Deficit and Monetized Deficit are the deficits on the basis of financing.
  • Fiscal Deficit, Primary Deficit, Revenue Deficit and Effective Revenue Deficit are the deficits on the basis of type of transactions.
  • Factor income: It is determined by subtracting income made by citizens of a country on their foreign investments from income earned by foreigners on their investments within the country.
  • Current/Financial transfers: Theyinclude interest earnings, foreign remittances, donations, aids and grants, official assistance, pensions etc.
  • Current account deficit/balance: trade deficit + factor income + financial transfersOR
  • CAD/CAB = (X−M) + (NY+NCT) where:
  • X = Exports of goods and services
  • M=Imports of goods and services
  • NY=Net income abroad
  • NCT=Net current transfers
  • Balance of payments: The balance of payments is the sum of all transactions between a nation and all of its international trading partners.

Fiscal expansion

  • Fiscal expansion is generally defined as an increase in economic spending owing to actions taken by the government.
  • Expansionary fiscal policy can also lead to inflation because of the higher demand in the economy.
  • A general increase in overall spending can cause the cash flow leaving the country to increase as consumers and the government both purchase more. This increases the debit side of the balance of payments.
  • Fiscal expansion generally worsens theInflation and Balance of payments.
  • The decreasing order of the deficits is generally like:
  • Fiscal Deficit
  • Revenue Deficit
  • Effective Revenue Deficit
  • Primary Deficit
  • Sources of Financing Fiscal Deficit are Debt Receipts and Draw Down of Cash Balance.
  • In the Debt Receipts, the various sources in decreasing order are usually like:
  • Market Borrowings (G-sec +T Bills)
  • Securities against Small Savings
  • Other Receipts (Internal Debts and Public Account)
  • State Provident Funds
  • External Debt

 

  1. Operation Ganga (TH, pg 1)

  • The government started ‘Operation Ganga‘ to evacuate stranded Indians from Ukraine.

 

  1. Sagar Parikrama(PIB)

  • Union Ministryof Fisheries, Animal Husbandry and Dairyinginaugurated the ‘Sagar Parikrama.’
  • The Parikrama, as a part of‘Azadi Ka Amrit Mahotsava’, is an endeavour to know the problems of Coastal Fisher folk.
  • ‘Azadi Ka Amrit Mahotsava’ is one of the significant initiatives of the Government of India to celebrate and commemorate 75years of independence and the glorious history of its people, culture and achievements.