GS Paper 3

De-dollarisation: the race to attain the status of global reserve currency

Context: While countries have tried to dethrone the dollar as the global reserve currency for many decades now for various reasons, of late such attempts have picked up pace in the aftermath of Russia’s invasion of Ukraine last year.

Status of Global Currencies

  • According to the BIS Triennial Central Bank Survey 2022, in terms of foreign exchange market turnover (daily averages), the dollar was the most dominant currency accounting for 88 per cent of the global forex turnover in 2022, followed by the Euro (31 percent), Japanese Yen (17), and Pound Sterling (13); the rupee accounted for a mere 2 percent of global currency market turnover.
  • Similarly, as per IMF’s COFER data, the dollar’s share of global foreign exchange reserves during 2022 Q4 stood at 58.4 percent, followed by Euro (20.5), Japanese Yen (5.5), Pound Sterling (5), Chinese Renminbi (2.7), Canadian dollar (2.4), Australian dollar (2), and Swiss Franc (0.2); India’s share was negligible.

What is De-dollarisation?

  • De-dollarisation refers to the replacement of the U.S. dollar by other currencies as the global reserve currency.
  • Attempts to de-dollarize have picked up pace in the aftermath of Russia’s invasion of Ukraine last year. The U.S. imposed several sanctions that restricted the use of the U.S. dollar to purchase oil and other goods from Russia, and this has been seen by many countries as an attempt to weaponise the dollar. 
  • Currently, the Chinese yuan is seen as the primary alternative to the U.S. dollar owing to China’s rising economic power.

Advantages of Reserve Currency

  • A reserve currency refers to any currency that is widely used in cross-border transactions and is commonly held as reserves by central banks. The currencies of economic superpowers that have usually ended up being used as the global reserve currency.
  • When a country’s fiat currency enjoys reserve currency status, it gives the country the power to purchase goods and other assets from the rest of the world by simply creating fresh currency out of thin air. 
  • Other currencies such as the British pound and the French franc have served as international reserve currencies in the past. As the economic clout of these countries waned, their currencies faced a similar downfall. This was the case, for example, with the British pound which was gradually replaced by the U.S. dollar as Britain lost its status as a global economic superpower in the first half of the 20th century.
  • The global reserve currency status of the US Dollar gives it unfair privileges over other countries, thus justifying de-dollarisation attempts by many countries.
  • Since international transactions carried out in the U.S. dollar are cleared by American banks, this gives the U.S. government significant power to oversee and control these transactions.

Popularity of US Dollar

  • The U.S. dollar is widely used in international transactions because people actually prefer to use the American currency over others for various economic reasons. 
  • Other currencies are not as popular as the greenback for carrying out international transactions. For example, a recent attempt by India and Russia to carry out trade between the two countries in Indian rupees rather than in U.S. dollars has hit a roadblock because the value of India’s imports from Russia far outweighs its exports to the country. This left Russia with excess rupees in hand which it was unwilling to spend on Indian goods or assets, and led to Russian demands for the settlement of bilateral trade in U.S. dollars. 
  • The global acceptability of the U.S. dollar has primarily been attributed to the popularity of U.S. assets among investors. The U.S. has been running a persistent trade deficit for decades now (the value of its imports has for a long time exceeded the value of its exports to the rest of the world). The excess dollars that the rest of the world accumulates due to the U.S’ trade deficit has been invested in U.S. assets such as in debt securities issued by the US government. The high level of trust that global investors have in the U.S. financial markets, perhaps owing to the ‘rule of law’ in the U.S., is considered to be a major reason why investors prefer to invest in U.S. assets. 
  • China, for instance, which supplies the world with huge volumes of goods and runs a trade surplus, has been trying to make the yuan a reserve currency. However, restrictions placed by the Chinese government on foreign access to China’s financial markets and doubts over ‘rule of law’ in China have adversely affected global demand for the yuan.

Reasons for De-dollarisation

  • Irresponsible expansion of the money supply can cause the debasement of the currency and eventually threaten its status as a reserve currency.
  • Expansionary monetary policy adopted by the U.S. Federal Reserve over the decades to argue that this could threaten the U.S. dollar’s status as a global reserve currency. The U.S. central bank usually increases the supply of dollars through various means to tackle economic downturns and also to fund the U.S. government’s expenditures. 
  • However, the U.S. Federal Reserve is not the only central bank in the world that has been debasing its currency by engaging in expansionary monetary policy over several decades. Other countries have also been expanding their respective money supplies to address their domestic economic problems. As long as the U.S. does not debase its currency at a faster pace than other countries, the dollar may manage to hold its value against other currencies and hence its reserve currency status may not come under serious threat.

Way Forward for India: Rupee Invoicing for Foreign Trade

  • Rupee invoicing became a buzzword post the July 2022 RBI circular that allowed invoicing, payment and settlement of trade (exports/imports) in Indian rupee.
  • Foreign Trade Policy (FTP) 2023 wants to thrust exports on the wheels of rupee invoicing that proposes both trading partners raising their invoices and settling payments for their transactions on a bilateral basis in rupees. The framework facilitates invoicing of exports and imports in rupee, market-determined exchange rates between currency pairs of the trading partners, and trade settlement via Special Rupee Vostro Account (SRVA).
  • The benefits of rupee invoicing are manifold, especially during geopolitical unrest and when economic sanctions are levied against India’s major trade partners.
  • Amongst the benefits, the prominent ones are lowering of transaction costs, a greater degree of price transparency, quick settlement time, promoting international trade, reduction in hedging expenses, reduced cost of holding foreign reserves by the RBI and, most importantly, internationalisation of the rupee.
  • Analysis shows that invoicing in rupee would be more favourable with trade partners such as Russia, Saudi Arabia, Nigeria and the UAE, where India is a large importer and potential exists for Indian exports as well.
  • Some of the countries that hold potential for trade settlement in rupee are shown in the Chart.
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  • India’s policy of facilitating trade in rupees has been gaining momentum, with the total number of SRVAs reaching 60 in a span of seven months (Rajya Sabha question on March 14). Eighteen countries have opened SRVAs to facilitate overseas trade in rupee. Of these countries, India recorded a trade deficit with eight — Botswana, Germany, Guyana, Malaysia, Myanmar, Oman, Russia and Singapore — in FY22.

Conclusion:

  • The effectiveness of rupee trade, however, ultimately depends on whether India is running a net trade deficit or surplus with the participating trading partners, as well as the extent of trading in rupees in comparison to the total bilateral trade.

Why Indian start-ups have accused the Internet and Mobile Association of India of spreading ‘Big Tech propaganda’

Context: Recently Prominent founders of some of the country’s new-age businesses have accused the Internet and Mobile Association of India (IAMAI) of “promoting the views” of big tech companies such as Google and Meta and have called into question its organisational structure, which is led by representatives of such tech companies.

Why the accusations?

IAMAI criticised the recommendations of the Parliamentary Standing Committee on Finance to introduce a new law for tackling Big Tech firms’ anti-competitive practices.

What were the recommendations of the Parliamentary Penal?

  • To curb anti-competitive practices in digital markets, last December, the panel proposed measures like having ex-ante regulations, which are meant to protect consumers by requiring companies to follow certain standards of behaviour, as opposed to post-ante regulations that can only punish an entity after it has breached a law.
  •  designating Big Tech entities as “systemically important digital intermediaries” and then subjecting them to certain ex-ante provisions.
  •  a new digital competition law.
  • It asked digital market entities to desist from “anti-steering”, “deep discounting”, “self-preferencing”, “search & ranking preferencing” and other promotional practices that lead to consumers going for these companies in the market, impacting competition.

Why do we need new digital competition law?

  •  Competition Act, of 2002, covers services but there is ambiguity regarding digital services.
  •  Digital services have a great impact on the consumption of other goods and services this aspect is not covered under the existing Act.
  • The digital world has a large impact on polity and society as it has become a tool of narrative formation that is being used and misused by political leaders.
  •  We are facing the rising issue of fake news, digital propaganda etc.

Centre weighs methods to quantify household chores done by women

Context: The Indian government is considering methods to measure the value of women's household chores to the country's GDP.

Gender Gap (GDP) in India

  • India is exploring methods to measure the contribution of household chores performed by women to the country's GDP. 
  • The government plans to make the Time Use Survey a regular feature to understand how much time women spend on household work. Other methods, such as the diary method and direct observation method, are also being considered. 
  • The government may develop a methodology to quantify household work and its contribution to the GDP. 
  • Women in India spend more time on unpaid domestic services for household members than men. 
  • The Time Use Survey provides a framework for measuring time dispositions by the population on different activities. 
  • Experts are skeptical about including personal consumption activities in the GDP and how household chores would add to India's GDP.
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Measuring the contribution of household chores performed by women can bring about several benefits to both the economy and women in particular.

  • Recognition of the economic contribution of women: Measuring household work can recognize women's significant contribution to the economy, highlighting the economic value of unpaid domestic services and their role in the country's economy.
  • Better policy formulation: Data on women's household work time can inform policymaking, leading to more targeted policies for women and their families, in areas such as health, education, and employment.
  • Improved economic planning: The measurement of household work can help in improved economic planning and decision-making. This can provide policymakers with a more complete picture of the economy and help them make more informed decisions. 
  • Empowerment of women: Measuring household chores as part of GDP can empower women by recognizing their work as valuable economic activity, leading to increased labor force participation, better wages, and working conditions.

The measurement of household chores performed by women can help in recognizing the value of women's unpaid work and enable policymakers to design more targeted policies for women's economic empowerment.

StarBerrySense Star Sensor

Context: A new low-cost star sensor, developed by astronomers from the Indian Institute of Astrophysics (IIA) from off-the-shelf components, was recently put into space by ISRO’s PSLV C-55.

About the Star sensor:

  • Named ‘StarBerrySense’, the payload (sensor) is mounted on ISRO’s PSLV orbital experimental module (POEM), which provides a stable platform for our payload to operate from.
    • POEM is a unique initiative by ISRO that utilises the spent fourth stage of the PSLV rocket as an orbital platform for carrying out scientific experiments. 
  • Main function of StarBerrySense is to image the field of view, correctly identify the stars it sees, and accurately calculate where a satellite is pointing in space, as for any space mission it is crucial to know the exact positioning of the satellite. The start sensor is capable of finding its pointing direction in space by identifying the stars in its field of view.
  • This payload is built around the well-known minicomputer RaspberryPi, and the electronics and software were designed in-house. The advantage of this payload is that it is cost-effective, simple to build, and can be deployed on a wide variety of satellites. 
image 4

Star-sensor:

  • The star sensor is essentially a celestial compass. Any satellite needs to know where it is pointed in space, and the instrument used for this purpose is called a star sensor.
  • The position of stars in the sky is fixed relative to each other and can be used as a stable reference frame to calculate the orientation of a satellite in orbit. This is done by correctly identifying the stars in the sky towards which the star sensor is pointed. 

Psychedelic substances

Context: Psychedelic drugs are emerging in research as promising ways to treat treatment-resistant depression and post-traumatic stress disorder

What are Psychedelic substances

  • Psychedelics are a group of drugs that alter perception, mood, and thought processing while a person is still clearly conscious. 
  • Psychedelics are non-addictive, non-toxic and compared to illicit drugs, they are less harmful to the end user.
  • In India, the Narcotic Drugs and Psychotropic Substances Act 1985 prohibits (bans) the use of psychedelic substances.
    • Ketamine, a dissociative anaesthetic with psychedelic properties, is used under strict medical supervision, for anaesthesia and treatment-resistant depression.

How do the drugs work in the body?

  • Users of psychedelic substances report changes in perception, somatic experience, mood, thought-processing, and entheogenic experiences. 
  • Modern neuroimaging suggests that psychedelics are neither stimulants nor depressants of brain activity. Instead, they increase the cross-talk between different brain networks, and this correlates with the subjective effects of psychedelics.

Can psychedelics be used to treat neuropsychiatric disorders?

  • In November 2022, the results from a phase II psilocybin trial were published in the New England Journal of Medicine. The trial found that a single 25-mg dose of psilocybin reduced depression scores over three weeks in people with treatment-resistant depression.
  • In 2017, the U.S. Food and Drug Administration (FDA) designated the use of 3,4-methylenedioxymethamphetamine, also known as MDMA, to be the “breakthrough therapy” in the treatment of post-traumatic stress disorder (PTSD). 

Can such substances cause harm?

  • Death due to direct toxicity of LSD, psilocybin or mescaline has not been reported despite 50-plus years of recreational use. An overdose requires cardiac monitoring and supportive management in a low-stimulus and reassuring environment.
  • Synthetic psychedelics (such as 25I-NBOMe) have been associated with acute cardiac, central nervous system, and limb ischaemia, as well as serotonin syndrome. There have also been reports of death attributed directly to synthetic psychedelic use.

Great Nicobar Island project

Context: The eastern bench of the National Green Tribunal (NGT) has ordered a stay on the ₹72,000 crore Great Nicobar Island project and constituted a committee to revisit the environmental clearance granted by the Ministry of Environment, Forest and Climate Change (MoEF&CC).

About the Great Nicobar Island Project

  • The Great Nicobar Island (GNI) Project is a mega project to be implemented at the southern end of the Andaman and Nicobar islands. 
  • The project will include, among others, an International Container Transhipment Terminal (ICTT), a Greenfield international airport, a township, and a 450 MVA gas- and solar-based power plant over 16,610 hectares in the Great Nicobar Islands.

Impacts: 

  • Tectonic Volatility: The GNI lies between the Bay of Bengal and the Andaman Sea in a tectonically sensitive zone.
  • “Important Marine Turtle Habitats in India”: 
    • In February 2021, India’s National Marine Turtle Action Plan mentioned Galathea Bay on the south-eastern coast of the Great Nicobar Island as one of the “Important Marine Turtle Habitats in India”. 
    • Beaches on either side of the Galathea River are the most important nesting sites in the northern Indian Ocean for the Leatherback turtle, the world’s largest marine turtle. 
    • The Action Plan says that coastal development projects, including the construction of ports, jetties, resorts, and industries, are major threats to turtle populations.
  • Impact on tree cover:
    • The loss of tree cover will not only affect the flora and fauna on the island, it will also lead to increased runoff and sediment deposits in the ocean, impacting the coral reefs in the area. 
  • Destruction of Tribal land:
    • GNI is designated as a tribal reserve under the Andaman and Nicobar Protection of Aboriginal Tribes Regulation, 1956. 
    • The Island has been home to two isolated and indigenous tribes — the Shompen and the Nicobaris — for thousands of years.
  • UNESCO’s Man and Biosphere Programme in 2013: 
    • The GNI was declared a biosphere reserve in 1989 and included in UNESCO’s Man and Biosphere Programme in 2013. 
    • It has an unparalleled array of microhabitats- sandy and rocky beaches, bays and lagoons, littoral patches with mangrove communities, evergreen and tropical forests, and more. 
    • These habitats host numerous species, including marine animals, reptiles, birds, mammals, trees, ferns, insects, crustaceans, and amphibians. 
    • Several of these, like the Nicobari Megapode, are endemic to GNI and found nowhere else in the world.

  • Concerns Against the Project
    •  Shompen people will be displaced leading to their total marginalisation.
    •  Endemic flora and fauna will be displaced.
    •  Diversion of forests and coastal development not allowed under
    •  Tribals have not been adequately consulted.

  • Rationale for the project
    •  Countering China’s increasing presence in the Indian Ocean Region
    •  Curb the stealing of marine resources by poachers from Myanmar
    •  Bridge infrastructure gaps in the region,
    •  Promote international trade by allowing the port to provide an alternative to Singapore ports.
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About Great Nicobar: 

  • Great Nicobar, the southernmost of the Andaman and Nicobar Islands, has an area of 910 sq km. 
  • The Andaman and Nicobar Islands are a cluster of about 836 islands in the eastern Bay of Bengal, the two groups of which are separated by the 150-km wide Ten Degree Channel. 
  • The Andaman Islands lie to the north of the channel, and the Nicobar Islands to the south.
  • Indira Point on the southern tip of Great Nicobar Island is India’s southernmost point, less than 150 km from the northernmost island of the Indonesian archipelago.
  • The island comprises of unique and threatened tropical evergreen forest ecosystems. 
  • The region is noted for its rich biodiversity and fosters several rare and endemic species.
    • The endemic species comprise of 11 species of mammals, 32 species of birds, 7 species of reptiles and 4 species of amphibians. 
    • Of these, the well-known Crab-eating Macaque, Nicobar Tree Shrew, Nicobar Megapode, are endemic and/or endangered.
    • It is home to 650 species of angiosperms, ferns, gymnosperms, bryophytes, among others. 
  • One of the most unique aspects of Great Nicobar is the southernmost point, the Galathea Bay, a nesting ground for the Leatherback Turtle.
  • The primary human inhabitants of the island are the Shompen and Nicobarese tribes who have been living on the island for countless generations.
    • The Shompen tribe are an aboriginal people of about 200 to 300 members who inhabit the interiors of Great Nicobar. 
    • This particularly vulnerable tribal group (PVTG) is a semi-nomadic hunter-gatherer community, practicing basic horticulture and pig rearing, who probably migrated around 10,000 years ago.
    • They are a unique group, anthropologically completely distinct from the other PVTGs of the Andaman Island as well as from the Nicobarese. 
    • Their language, Shompanese, unrelated to any other existing language, seems to have adopted a few words from Nicobarese in the context of an existing, even if very limited, barter system between the two communities.

Roadmap to energy justice

Context: A pragmatic and balanced strategy has helped India to keep prices of petrol, diesel and gas under check.

How has India managed control oil prices?

  • When petrol and diesel prices went up by 35-40 per cent in the US, Canada, Spain and the UK, and despite importing over 85 per cent of its crude oil requirements and 55 per cent of its natural gas requirements, prices of diesel in India have actually gone down in the last one year. 
  • India has outperformed many of its neighbouring nations in controlling oil prices.
  • Centre and many states announced massive cuts in excise duty and VAT rates, twice.
  • Oil PSUs, absorbed huge losses to ensure that the massive hikes in the prices of crude oil and natural gas in the international market were not passed on to Indian consumers.
  • Subsidised APM gas for city gas distribution sector was drastically increased even at the cost of cutting down the captive use of domestic gas by our own PSUs. 
  • Imposition of export cess on petrol, diesel and ATF and windfall tax on domestically produced petroleum products to prevent refiners and producers from profiteering at the cost of domestic consumers.
  • India has also further strengthened its ties with countries like the US (energy trade has gone up 13 times in the last four years) and Russia to ensure a reliable supply of crude oil. 

Steps towards oil exploration and refinery

  • By 2025, India wants to boost its net geographic area under exploration from 8 per cent (0.25 million sq km) to 15 per cent (0.5 million sq km) and has reduced the prohibited/no-go areas in our Exclusive Economic Zone (EEZ) by 99 per cent, releasing nearly 1 million sq km for exploration.
  • As per consulting firm Wood Mackenzie noting that India could be the licensing wildcard of 2023.
  • India is a global exporter of petroleum products and its refining capacity is the fourth largest in the world after the US, China, and Russia. Efforts are underway to further enhance this capacity to 450 MMT by 2040.

Expansion in Gas sector and alternative fuels

  • India is also accelerating its efforts to move towards a gas-based economy by increasing the share of gas from the current 6.3 per cent to 15 per cent by 2030.
  • India has connected more than 9.5 crore families with clean cooking fuel in the past nine years. 
  • PNG connections have increased from 22.28 lakh in 2014 to over 1 crore in 2023. 
  • The number of CNG stations in India has gone up from 938 in 2014 to 4,900 in 2023. 
  • Since 2014, India has increased the length of its gas pipeline network from 14,700 kms to 22,000 kms in 2023.
  • India took a giant stride in her biofuel revolution by launching E20 — 20 per cent ethanol blended gasoline — which will be rolled out in 15 cities and expanded across the country in the next two years.
  • India’s ethanol blending gasoline has grown from just 1.53 per cent in 2013-14 to 10.17 per cent in 2023, and now India is also setting up five second generation ethanol plants, which can convert agricultural waste into biofuel, further reducing pollution due to stubble burning and generating income for farmers.
  • National Green Hydrogen Mission has been launched with an outlay of Rs 19,744 crore to develop the entire green hydrogen ecosystem in the country and accelerate India’s efforts towards 4 MT of annual green hydrogen production and Rs 1 lakh crore of cumulative fossil fuel import savings by 2030. India is poised to realise its full potential to create a green hydrogen ecosystem by 2030.
  • India is targeting the installation of alternate fuel stations (EV charging/CNG/ LPG/LNG/CBG etc.) at 22,000 retail outlets by May 2024.

G7 should adopt 'risk-based' AI regulation, say digital ministers

Context: Digital ministers from the Group of Seven advanced nations have agreed on the adoption of "risk-based" regulation for artificial intelligence (AI).

More on news:

G7 digital ministers emphasised on preserving an "open and enabling environment" for the development of AI technologies based on democratic values. The agreement sets a landmark for how major countries govern AI amid privacy concerns and security risks. The G7 ministers also recognised the security risks posed by generative AI, such as the production of fake news.

Artificial Intelligence and its Regulation

Reimagining ration shops

Context: The Food Corporation of India (FCI) has procured over 20 million tonnes of wheat this season, with Punjab, Haryana and Madhya Pradesh contributing over 98% of the total to the central pool.

Punjab is expected to be the largest contributor to wheat procurement despite producing less wheat than Uttar Pradesh. Farmers in Punjab who used zero tillage and mulched paddy straw at the time of sowing wheat through smart happy seeders were able to achieve a high yield, while others who experienced heavy rain had lower yields. Mulching paddy straw helps increase organic carbon in soil and can be a good case for India to show to the agriculture group of G20, with Punjab Agricultural University and Borlaug Institute for South Asia leading the way.

Public distribution System (PDS):

  • The Public Distribution System (PDS) in India was established in June 1947 as a way to ensure that food grains are distributed at affordable prices and to manage emergency situations. 
  • Its primary goal is to provide subsidized food and non-food items to the country's poor population. 
  • By helping to alleviate hunger, malnutrition, Anaemia, and other challenges faced by the poorest members of society, including women and children, PDS has played an important role in promoting socio-economic justice in India. 
  • The PDS is managed jointly by the Central and State/UT Governments. 
  • It works under the Ministry of Consumer Affairs, Food and Public Distribution.
  • The Central Government, through the Food Corporation of India (FCI), is responsible for procurement, storage, transportation, and bulk allocation of food grains to the State Governments. On the other hand, the operational responsibility, including allocation within the State, identifying eligible families, issuing Ration Cards, and overseeing the functioning of Fair Price Shops (FPSs), falls under the purview of the State Governments. 
  • The PDS currently distributes wheat, rice, sugar, and kerosene to States/UTs for distribution. Some States/UTs also use PDS outlets to distribute other essential items like pulses, edible oils, iodized salt, spices, etc.

Issues in PDS:

  • Targeting: The targeting of the PDS is often flawed, with many deserving beneficiaries being excluded while others who are not in need receive the benefits. 
  • Leakage and corruption: There are high levels of leakage and corruption in the PDS, with food grains being diverted to the black market or sold to non-eligible beneficiaries. 
  • Poor quality of food grains: The food grains provided through the PDS are often of low quality, with high levels of adulteration and not fit for human consumption. 
  • Inadequate coverage: The PDS does not cover all deserving households, leaving many without access to essential food grains. 
  • Inefficient distribution mechanism: The distribution mechanism of PDS is often inefficient, with delays and irregularities in the supply of food grains to the beneficiaries. 
  • Lack of awareness: Many of the beneficiaries are not aware of their entitlements under the PDS, and hence, do not receive the full benefits of the system. 
  • Storage and transportation issues: The storage and transportation infrastructure for the food grains is often inadequate, leading to spoilage and wastage of the grains. 
  • Price disparities: The prices of food grains provided through PDS vary across states, resulting in disparities and discrimination. 
  • Limited nutritional diversity: The food grains provided through PDS are limited in terms of nutritional diversity, leading to malnutrition and health issues among the beneficiaries.

Way Forward:

  • Professor Ashok Gulati suggests the introduction of more nutritious food in PDS that is climate resilient, such as millets, pulses, and oilseeds. 
  • Upgrading 10% of the five-lakh odd fair price shops as Nutritious Food Hubs (NFHs) and offering electronic vouchers for targeted beneficiaries.
  • FCI should outsource its stocking operations to various agencies such as Central Warehousing Corporation, State Warehousing Corporation to bring down costs of storage. (Shantakumar committee)
  • Covered and plinth (CAP) storage should be gradually phased out. The Movement of grains needs to be gradually containerized to reduce transit losses.
  • End to End computerization to reduce leakages in PDS and setting up of vigilance committees to check pilferage from PDS.

SC modifies order on Ecologically Sensitive Zones around protected forests 

Context: The Supreme Court modified its judgment to have mandatory Eco sensitive zones (ESZ) of a minimum one kilometre around protected forests, national parks and wildlife sanctuaries across the country.

What is the concept of Ecologically sensitive zone (ESZ)?

  • The 2002 Wildlife Conservation Strategy envisaged lands within 10 km of the boundaries of national parks and wildlife sanctuaries to be notified as ecologically fragile zones under Section 3(2)(v) of the Environment Protection Act 1986.
  • Ecologically sensitive zones (ESZ) are intended to protect ‘protected areas’ – national parks and wildlife sanctuaries – by transitioning from an area of lower protection to an area of higher protection. 
  • ESZs are effectively insulating layers where humans and nature can be at peace with each other.
  • Thus they act as a buffer and ‘shock absorber’ to the protected areas.
  • Besides, in order to protect the biodiversity in areas having ecological significance, Ministry also notifies Ecologically Sensitive Areas (ESA), which has unique biological resources, which require special attention for their conservation.
  • The MoEFCC was to take steps to protect the environment by regulating and (if required) prohibiting industries, operations and processes. 

What is the procedure to notify ESZ?

  • Survey and identification of ESZs are conducted by the respective State Governments for consideration of the Central Government as per the guidelines formulated by the Ministry of Environment, Forest and Climate Change (MoEF&CC). 
  • On the basis of proposals and recommendations of the State Government, Ministry notifies the ESZs under the Environment (Protection) Act, 1986. 
  • Section ‘3’ of the ESZ Notification provides the Guidelines for preparation of the Zonal Master Plan (ZMP) by the respective State Government and mandates preparation of the Tourism Master Plan forming part of Zonal Master Plan on the basis of the Carrying Capacity study of the concerned ESZ. 

Evolution of the ESZ in India:

  • 2002 - Wildlife Conservation Strategy envisaged lands within 10 km of the boundaries of national parks and wildlife sanctuaries to be notified as ecologically fragile zones under Section 3(2)(v) of the Environment Protection Act 1986 .
  • 2005 - National Board for Wildlife decided to delineate site-specific ESZs to regulate specific activities instead of prohibiting them. So it asked the States and UTs to propose ESZs. 
  • 2006 - Supreme Court directed the MoEFCC to have the States’ and UTs’ proposals submitted within four weeks.
  • 2010 – No guidelines by MoEFCC. Supreme court intervened. 
  • 2011 – Guidelines by MoEFCC came:
    • A committee consisting of the Wildlife Warden, an ecologist, and an official from the local government was to determine the extent of each ESZ, the nature of environmental concerns to be addressed and ways to address them
    • The Chief Wildlife Warden was to then list the activities that were to be prohibited, to be restricted with safeguards and to be permitted.
    • Finally, the state government would submit this, the geographical description of the area and the biodiversity values, the rights and entitlements of local communities, and their economic potential and implications for their livelihoods, as a proposal to the MoEFCC for notification.
    • To monitor compliance with the various provisions of each notification, a State had to set up a monitoring committee for each ESZ; headed by the District Collector as the chairperson.
  • 2012 – ESZ notification began.

What was the recent Supreme court order?

  • The court said that the MoEFCC guidelines are also to be implemented in the area proposed in the draft notification awaiting finalisation and within a 10-km radius of yet-to-be-proposed protected areas. 
  • It mandated a minimum 1-km eco-sensitive zone around national parks or wildlife sanctuaries
  • The Court also allowed States to increase or decrease the minimum width of ESZs in the public interest.
  • Court vested the powers to ensure compliance with the guidelines with the Principal Chief Conservator of Forests (PCCF) and the Home Secretary of the State/UT.
  • The court also ordered that no new permanent structure could come up for any purpose within an ESZ.
  • All the activities permitted by the guidelines and which are already being carried out can continue only if the PCCF grants permission, and that too within six months of the court’s order. This period has already expired.

What is the issue now?

  • These court’s directions have put the lives of many people in the hands of the PCCF. Several concerns were sparked regarding the habitation falling under the ESZ zone. There rights are also protected under Forest rights act 2006 and PESA act 1996.
  • If no permanent construction is to be permitted for any purpose, a villager who is desirous to reconstruct his house would not be permitted.
  • Similarly, if the government decides to construct schools, dispensaries, anganwadi and other basic structures for improvement of the life of the villagers, the same would also not be permitted.”

What is the modified order?

  • 2022 order will not be applicable to ESZs in respect to which draft and final notifications have been issued by the MoEFCC, and where proposals for such notifications have been received by the ministry.
  • It will also not be applicable where the national parks and sanctuaries are located on inter-state borders or share common boundaries.
  • But it underlined that no mining would be allowed, either within national parks and sanctuaries or in a 1-km radius.

Army to raise Command Cyber Operations and Support Wings

Context: The Army Commanders Conference (ACC) that was held. The ACC had decided to operationalise Command Cyber Operations and Support Wings (CCOSWs) in the immediate future with current focus on net-centric operations.

  • These organisations will assist the formations to undertake the mandated cyber security functions to strengthen the cyber security posture of the Army. As Cyberspace has emerged as an important component of military domain both in grey-zone warfare as well as conventional operations and Indian Army too is rapidly migrating towards net-centricity, which entails increased reliance on modern communication systems at all levels.

About Grey zone Warfare

Grey zone warfare refers to employing aggression and other actions to achieve national objectives below the threshold of armed conflict and the ambiguity it creates. 

The characteristics of the Grey zone  warfare can be identified by 

  • Grey zone elements remain below the threshold that would justify a military response, often through the use of non-military tools. 
  • The second common characteristic of grey zone activities is that they unfold gradually over time rather than involving bold, all-encompassing actions to achieve objectives in one step. The progressive unfolding of aggressive moves over the years, or even decades, reduces opportunities for decisive responses as a counter. 
  • The third characteristic, which applies to some but not all the activities in this sphere, is a lack of attributability. Most grey zone campaigns involve actions, whereby the aggressor aims for plausible deniability of its action. Whether it is cyberattacks or disinformation campaigns or the use of proxy forces, these actions allow a grey zone aggressor to deflect responses—and obstruct the potential for successful deterrence—by simply denying that it is responsible.

For example  in cases where grey zone actions are open and attributable, such as China’s approach in the South China Sea, they are justified using extensive legal and political argument. Fourthly, grey zone campaigns target specific vulnerabilities in the targeted countries. Grey zone aggressors also typically aim to put the defenders in situations where strong responses appear ruled out or counterproductive for strategic and domestic political reasons. In other words, grey zone warfare takes advantage of strategic ambiguity to achieve gradual gains.

Should India consider phasing out nuclear power?

Context: With solar and wind power becoming more popular globally, there are questions on whether nuclear power, with its concerns about cost and safety, remains a relevant option for the future, particularly in India.

Advantages and Need for Nuclear Power

  • Clean Energy: Nuclear power does not produce greenhouse gases like carbon dioxide and methane, which contribute to climate change. Therefore, it is a cleaner source of energy compared to fossil fuels. 
  • High Energy Density: Nuclear power plants can produce a large amount of energy from a small amount of fuel.
    • For operating a plant like Kudankulam over a year — 1,000 megawatts at 90% PLF (plant load factor) —the requirement is only 25 tonnes of low-enriched uranium fuel. Low enrichment means below 5% (proportion of fissile uranium). 
    • Compared to a coal plant (of similar capacity) — approximately five million tonnes of coal is required. Further, thermal power plants are polluting and coal produces ash. (Ash contains many heavy metals, which are detrimental to the water source). 
  • Firm/Reliable Power: Nuclear power plants can run continuously for months or even years without needing to refuel, providing a reliable source of electricity.
  • Improved safety designs: Post Chernobyl, the nuclear industry has moved towards ‘passive safety’ designs (for nuclear reactors). Older designs required active cooling pumps, but now even if the power fails, the improved systems will gradually and gracefully control temperature.
  • Lack of other alternatives: 
    • Currently, the major share of India’s energy mix is thermal power. With nearly 210 gigawatts of coal capacity, the sector produces 73% of the electricity of India. However, coal is a non-renewable fossil fuel and leads to massive greenhouse gas emissions. 
    • India has very limited growth potential for hydropower because of conserving biodiversity, costs of rehabilitating and compensating land owners and seismological factors in the Himalayas.
    • Solar and Wind are fairly good alternatives but the issue with wind and solar power is that the energy generated is variable, and also the high cost is associated with Solar photovoltaic cells and storage batteries. 
  • Meet Sustainable Energy targets of India: India has the target to cut carbon emissions by 1 billion tonnes by 2030 and achieve net-zero emission status by 2070. For that purpose, India needs to diversify its energy mix and increase the share of renewable clean energy like Nuclear energy. 

Concerns regarding Nuclear power

Resistance to nuclear energy is driven by fears about safety, nuclear proliferation, or some other concerns related to its use, including: 

  • Nuclear accidents: The risk of nuclear accidents is one of the biggest concerns related to nuclear power. The disasters at Chernobyl and Fukushima have demonstrated the devastating effects that can occur when nuclear reactors malfunction. Even with strict safety protocols, accidents can still happen.
  • Nuclear waste: Nuclear power produces radioactive waste that can remain dangerous for thousands of years. There is no universally agreed-upon solution for the long-term storage and disposal of nuclear waste.
  • Proliferation of nuclear weapons: Spent Nuclear fuel can be enriched and Nuclear technology can be used to create nuclear weapons. There is particularly a concern in countries with less-than-transparent governments that can use nuclear power programs as a cover for the development of nuclear weapons.
  • High cost: Nuclear power plants are expensive to build and maintain and thus high cost of nuclear power can make it difficult for some countries to afford.
  • Public perception: Due to concerns about safety and the risk of accidents, public opposition can make it difficult to build new nuclear power plants and can lead to political and social tensions.

Challenges to scaling Nuclear Energy in India

  • Availability of fuel: India does not have large reserves of natural uranium and must import much of its nuclear fuel from other countries. This can make it difficult to plan for and maintain a stable supply of fuel, which in turn can limit the growth of the nuclear energy industry.
  • Limited contribution to energy mix: Presently, India has 22 nuclear reactors in operation at seven plants, with a total installed capacity of 6,780 MW, as well as eight reactors under construction. Still, nuclear power is only 2.5%-3.2% of India’s installed and generated power.
  • Nuclear liability: India's nuclear liability laws have also been a barrier to the growth of the nuclear energy industry. India’s strict liability laws place the burden of compensation for nuclear accidents on the plant operator, which can deter private companies from investing in nuclear power. 

Also, According to the Civil Liability for Nuclear Damage Act, 2010, the liability can be shifted from the operator to the vendor or supplier in case the accident is due to equipment or material. This was the reason nuclear companies pulled out of India, made it difficult to attract foreign investment in the industry and limited the growth of the sector.

E.g., Nuclear liability continues to be the major issue behind why the deal to install French European Pressurised Reactors at Jaitapur, Maharashtra, has not made progress.

  • Regulatory environment: India's regulatory environment for nuclear power is still evolving, and there is a need for clear and consistent regulations to govern the industry. This includes regulations related to safety, security, and waste management.
  • Government monopoly: One of the major reasons that the growth of nuclear power is hindered is due to the Government monopoly in the nuclear energy sector (all reactors are operated by the Nuclear Power Corporation of India Limited). 

Way Forward:

  • Combination of small modular reactors and large reactors to increase nuclear power production, reduce the cost of production and achieve sustainable energy targets. 
  • Government should allow the phased induction of other public sector companies like NTPC (National Thermal Power Corporation) to get into the nuclear power sector. And, consider the possibility of gradual induction of the private sector.