Currency Swap Facility

Why in News

Recently, Bangladesh cleared a USD 200 million currency swap facility for Sri Lanka, to help boost its economy.

Key Points

• About:
  
  • The word swap means exchange. A currency swap between the two countries is an agreement or contract to exchange currencies with predetermined terms and conditions.
  • In the present context, a currency swap is effectively a loan that Bangladesh will give to Sri Lanka in dollars, with an agreement that the debt will be repaid with interest in Sri Lankan rupees.
  • Central banks and Governments engage in currency swaps with foreign counterparts to meet short term foreign exchange liquidity requirements or to ensure adequate foreign currency to avoid Balance of Payments (BOP) crisis till longer arrangements can be made.
    
    • For Sri Lanka, this is cheaper than borrowing from the market, and a lifeline as it struggles to maintain adequate forex reserves even as repayment of its external debts looms.
  • These swap operations carry no exchange rate or other market risks as transaction terms are set in advance.
    
    • Exchange rate risk, also known as currency risk, is the financial risk arising from fluctuations in the value of a base currency against a foreign currency in which a company or individual has assets or obligations.
• Unusual for Bangladesh:
  
  • Bangladesh has not been viewed so far as a provider of financial assistance to other countries. It has been among the most impoverished countries of the world, and still receives billions of dollars in financial aid.
  • But over the last two decades, it has managed to elevate its economy itself majorly, and in 2020, was the fastest growing in South Asia.
    
    • The country has managed to pull millions out of poverty. Its per capita income just overtook India’s.
  • This may be the first time that Bangladesh is extending a helping hand to another country, so this is a landmark of sorts.
• Sri Lanka’s Approach to India:
  
  • In 2020, the President of Sri Lanka requested India for a USD 1 billion credit swap, and separately, a moratorium on debts that the country has to repay to India.
  • But India-Sri Lanka relations have been tense over Colombo’s decision to cancel a valued container terminal project at Colombo Port, which made India put off the decision.
  • Earlier, in July 2020, the Reserve Bank of India (RBI) extended a USD 400 million credit swap facility to Sri Lanka, which the Central Bank of Sri Lanka settled in February. The arrangement was not extended.
• RBI’s Framework for Swap Facilities for SAARC:
  
  • The SAARC currency swap facility came into operation on 15^th November, 2012.
  • The revised framework is valid from 14^th November, 2019 to 13^th November, 2022.
  • The RBI can offer a swap arrangement within the overall corpus of USD 2 billion.
  • The swap drawals can be made in US dollar, euro or Indian rupee. The framework provides certain concessions for swap drawals in Indian rupee.
  • The facility will be available to all SAARC member countries, subject to their signing the bilateral swap agreements.
  • The presumption was that only India, as the regional group’s largest economy, could do this. The Bangladesh-Sri Lanka arrangement shows that is no longer valid.

Balance of Payment

• Definition:
  
  • Balance of Payment (BoP) of a country can be defined as a systematic statement of all economic transactions of a country with the rest of the world during a specific period usually one year.
  • Overall the BoP account can be a surplus or a deficit.
    
    • If there is a deficit then it can be bridged by taking money from the Foreign Exchange (Forex) Account.
    • If the reserves in the forex account are falling short then this scenario is referred to as BoP crisis.
• Components of BOP:
  
  • Current Account: It shows export and import of visibles and invisibles (includes goods and services).
  • Capital Account: It shows a capital expenditure and income for a country. It gives a summary of the net flow of both private and public investment into an economy.
  • Errors and Omissions: Sometimes the balance of payment does not balance. This imbalance is shown in the BoP as errors and omissions.

Foreign Exchange Reserves

• Foreign exchange reserves are assets denominated in a foreign currency that are held by a central bank.
• These may include foreign currencies, bonds, treasury bills, and other government securities.
• These reserves are used to back liabilities and influence monetary policy.

Source: TH

The Climate Breakthroughs Summit

Why in News

Recently, world leaders convened at the Climate Breakthroughs Summit to demonstrate progress in critical sectors of the global economy, including steel, shipping, green hydrogen and nature.

Key Points

• About:
  
  • This is a collaboration between the World Economic Forum, Mission Possible Partnership, the United Nations Climate Champions, and the United Kingdom (COP 26 Presidency).
  • It aims to demonstrate the need for systemic change to accelerate the global transition to a zero-carbon economy.
    
    • The “Zero carbon economy” refers to the green ecological economy based on low energy consumption and low pollution, where emissions are compensated by absorption and removal of greenhouse gases (net-zero).
  • One of its key campaigns is the ‘Race to Zero’ campaign that mobilises support of 708 cities, 24 regions, 2,360 businesses, 163 investors, and 624 higher education institutions to move towards zero-carbon recovery for a sustainable future.
• Highlights of the Summit:
  
  • The United Nations made a call for coordinated action to secure global net-zero emissions and fulfill its goal of limiting global warming to 1.5 degrees Celsius compared to pre-industrial levels by 2050.
  • Maersk, the world’s largest container shipping line and vessel operator, joined Race to Zero with the commitment to halving the emission by 2030.
  • As many as 40 health care institutions worldwide have committed to halving emissions by 2030 and reaching net zero by 2050.
    
    • These 40 institutions represent more than 3,000 health care facilities in 18 countries.
  • The transitions of individual companies and institutions such as these are being supported by sector-wide plans, reflected in the revised Climate Action Pathways, launched with the Marrakech Partnership for Global Climate Action.
    
    • The pathways set out sectoral visions for achieving a 1.5°C resilient world in 2050, providing a roadmap to help countries and non-State actors alike to identify actions needed by 2021, 2025, 2030 and 2040 to deliver a zero-carbon world in time.
• Significance:
  
  • Decarbonizing both heavy industry (aluminium, concrete and cement, chemicals, metals and mining, plastics and steel) and light industry (consumer goods, fashion, ICT and mobile, and retail) is technically and economically feasible.
  • This can be done through reducing materials and energy use; increasing their productivity; and decarbonising production processes while implementing transitional solutions such as natural climate solutions where direct emissions reduction cannot be achieved.

Marrakech Partnership for Global Climate Action

• It supports implementation of the Paris Agreement by enabling collaboration between governments and the cities, regions, businesses and investors that must act on climate change.
• The focus is on environmental, economic and social system transformation, promoting higher ambition of all stakeholders to collectively strive for the 1.5 °C temperature goal and a climate-neutral and resilient world.

Race to Zero Campaign

• Race to Zero is the UN-backed global campaign rallying non-state actors – including companies, cities, regions, financial and educational institutions – to take rigorous and immediate action to halve global emissions by 2030 and deliver a healthier, fairer, zero-carbon world in time.
• Race To Zero mobilizes actors outside of national governments to join the Climate Ambition Alliance.

Climate Ambition Alliance

• The CAA currently includes 120 nations and several other private players that have committed to achieving zero net greenhouse gas emissions by 2050.
• Signatories are responsible for 23% of current greenhouse-gas emissions worldwide and 53% of global GDP.
• India is not part of this Alliance.

Source: DTE

RBI’s Annual Report 2020-21

Why in News

Recently, the Reserve Bank of India (RBI) released its Annual Report for 2020-21.

Key Points

• Foreign Exchange:
  
  • Gain from foreign exchange transactions rose from Rs 29,993 crore to Rs 50,629 crore in 2020-21.
    
    • Foreign Exchange is the trading of one currency for another.
• Surplus Transfer to the Government:
  
  • RBI has been able to transfer a higher amount to the government as surplus this year following a sharp fall in provisions (drop in expenditure was on account of a lower provision) and gains from foreign exchange transactions during the year ended March 2021.
    
    • It transferred Rs. 99,122 crore to the government which is likely to boost the government’s finances. It helped the government even as the Covid pandemic continued.

Provision for Giving Surplus to the Government

• Under Section 47 of the RBI Act, 1934, after making provisions for bad and doubtful debts, depreciation in assets, contribution to staff and superannuation funds and for all matters for which provisions are to be made by or under the Act or that are usually provided by bankers, the balance of the profits of the Reserve Bank is required to be paid to the central government.

• Rupee Against Dollar:
  
  • The rupee strengthened by 3.5% against the US dollar (at end-March 2021 over end-March 2020) but underperformed vis-a-vis other Asian countries during 2020-21.
• Decreased Bank Frauds:
  
  • Bank frauds of Rs.1 lakh and more fell by 25% in value to Rs.1.38 trillion in the year 2020-21 with the number of such cases also seeing a decline of 15% during the year.
• Digital Payments:
  
  • The Covid-19 pandemic increased the proliferation of digital modes of payments.
    
    • Total digital transaction volume in 2020-21 stood at 4,371 crore, as against 3,412 crore in 2019-20.
  • The prospects for FinTech in India’s financial system in 2021-22 will depend upon the degree of entrenchment of digital usage.
  • Various initiatives such as an innovation hub, a regulatory sandbox and offline payment solutions are underway to ensure that in the digital ecosystem, India maintains its position as a leader.
  • The RBI is also in the process of extending the geo-tagging framework put in place to capture location of bank branches and ATMs to cover payment system touch points, enabling accurate capture of their location across the country.
  • Further, the possibility of leveraging India’s domestic payment systems to facilitate cross-border transactions is being explored, and corridors and charges for inward remittances will be reviewed.
• Ensuring Liquidity:
  
  • The RBI will ensure a comfortable level of liquidity in the system during 2021- 22 in alignment with the stance of monetary policy.
    
    • This is exemplified by the introduction of the secondary market G-sec acquisition programme (G-SAP).
  • Monetary transmission will continue unimpeded while maintaining financial stability.
    
    • Monetary transmission refers to the process by which a central bank’s monetary policy signals (like repo rate) are passed on, through the financial system to influence the businesses and households.
• Economic Growth:
  
  • As the vaccination drive picks up and cases of infections fall, a sharp turnaround in growth is likely, supported by strong favourable base effects.
    
    • The base effect refers to the effect that the choice of a basis of comparison or reference can have on the result of the comparison between data points.
  • RBI predicted 10.5% GDP (Gross Domestic Product) growth for the year 2021-22.

Source: IE

ACCR Portal & Ayush Sanjivani App

Why in News

Recently, the Ministry of Ayush launched its Ayush Clinical Case Repository (ACCR) portal and the third version of Ayush Sanjivani App in a virtual event.

Key Points

• Ayush Clinical Case Repository Portal:
  
  • About:
    
    • It is conceptualized and developed by the Ministry of Ayush as a platform to support both Ayush practitioners and the public.
    • It welcomes Ayush practitioners from all over the world to enrol and share information about successfully treated cases for the benefit of all.
    • Cases whose details are posted here will be screened by experts, and will be uploaded for all to read/view subject to their review.
  • Aim:
    
    • To portray the strengths of Ayush systems for treatment of various disease conditions.
• AYUSH Sanjivani App Third Version:
  
  • About:
    
    • It is developed by the Ministry of Ayush and the Ministry of Electronics and Information Technology (MeitY).
      
      • First version was launched in May 2020.
    • It targets to reach out to 50 lakh people in the country.
    • The app intends to generate data on usage of AYUSH (Ayurveda, Yoga & Naturopathy, Unani, Siddha, Sowa-rigpa and Homoeopathy) advocacies and measures among the population and its impact in prevention of Covid-19.
  • Aim:
    
    • To understand the measures adopted by the public for enhancing immunity and keeping themselves healthy in difficult Covid-19 situations.
      
      • Data analyzed will be helpful for the further development of Ayush Systems.
  • Benefits:
    
    • It will facilitate a significant study and documentation regarding the efficacy of selected Ayush interventions, including Ayush 64 and Kabasura Kudineer medicines in the management of asymptomatic and mild to moderate Covid-19 patients.
      
      • Ayush 64 is a poly-herbal formulation developed by the Central Council for Research in Ayurvedic Sciences (CCRAS). It is useful in the treatment of asymptomatic, mild and moderate Covid-19 infection as an adjunct to standard care.
        
        • Initially the drug was developed for Malaria in the year 1980 and now is repurposed for Covid-19.
      • Kabasura Kudineer is a traditional formulation used by Siddha practitioners for effectively managing common respiratory health.
• Related Initiatives:
  
  • National Ayush Mission - Government of India is implementing the Centrally Sponsored Scheme of National Ayush Mission (NAM) through States/UTs for development and promotion of AYUSH system of medicine.
  • AYUSH Health and Wellness Centres.
  • Recently, government notification listed out specific surgical procedures that a postgraduate medical student of Ayurveda must be practically trained to acquaint with, as well as to independently perform.

AYUSH Systems
Ayurveda	The word ‘Ayurveda’ has derived from the fusion of two separate words- ‘Áyu’ i.e. life and ‘veda’ i.e. knowledge. Thus in literal meaning Ayurveda is the science of life. It aims to keep structural and functional entities in a state of equilibrium, which signifies good health (Swasthya) through various procedures, regimen, diet, medicines and behavior change.
Yoga	Yoga is an ancient physical, mental and spiritual practice that originated in India. The word ‘yoga’ is derived from Sanskrit and means to join or to unite, symbolizing the union of body and consciousness. Today it is practiced in various forms around the world and continues to grow in popularity (International Day of Yoga - 21st June).
Naturopathy	Naturopathic medicine is a system that uses natural remedies to help the body heal itself. It embraces many therapies, including herbs, massage, acupuncture, exercise, and nutritional counseling. Some of its treatments are centuries old but today, it combines traditional treatments with some aspects of modern science.
Unani	The Unani system originated in Greece and its foundation was laid by Hippocrates. However, the system owes its present form to the Arabs who not only saved much of the Greek literature by rendering it into Arabic but also enriched the medicine of their day with their own contributions. It was introduced in India by the Arabs and Persians sometime around the eleventh century. India has the largest number of Unani educational, research and health care institutions.
Siddha	Siddha system of medicine is practiced in some parts of South India especially in the state of Tamil Nadu. The term ‘Siddha’ has come from ‘Siddhi’- which means achievement. Siddhars were the men who achieved supreme knowledge in the field of medicine, yoga or tapa (meditation).
Sowa-Rigpa	“Sowa-Rigpa” commonly known as Tibetan system of medicine is one of the oldest, living and well documented medical traditions of the world. It originated from Tibet and popularly practiced in India, Nepal, Bhutan, Mongolia and Russia. The majority of theory and practice of Sowa-Rigpa is similar to “Ayurveda”. Sowa-Rigpa is based on the principle that bodies of all the living beings and non living objects of the universe are composed of five Cosmo physical elements of Jung-wa-nga (Prithvi, Jal, Agni, Vayu and Akash). When the proportion of these elements is imbalanced in our body, disorder results.
Homoeopathy	The word ‘Homoeopathy’ is derived from two Greek words, Homois meaning similar and pathos meaning suffering. It was introduced in India in the 18th Century. Homoeopathy simply means treating diseases with remedies, prescribed in minute doses, which are capable of producing symptoms similar to the disease when taken by healthy people, i.e.principle of - "Similia Similibus Curantur” which means "likes are cured by likes”. It takes a holistic approach towards the sick individual through promotion of inner balance at mental, emotional, spiritual and physical levels.

Source: PIB

Mekedatu Project: River Cauvery

Why in News

Recently, the Karnataka government has decided to challenge before the National Green Tribunal (NGT) its decision to appoint a joint committee.

• The joint committee is supposed to look into allegations of unauthorised construction activity taking place in Mekedatu, where Karnataka had proposed to construct a dam across the Cauvery.
  
  • Mekedatu, meaning goat’s leap, is a deep gorge situated at the confluence of the rivers Cauvery and its tributary Arkavathi.

Key Points

• Mekedatu Project:
  
  • The Rs. 9,000 crore project aims to store and supply water for drinking purposes for the Bengaluru city. Around 400 megawatts (MW) of power is also proposed to be generated through the project.
  • It was first approved by the Karnataka state government in 2017.
  • It received approval from the erstwhile Ministry of Water Resources for the detailed project report and is awaiting approval from the Ministry of Environment, Forest and Climate Change (MoEFCC).
    
    • The approval from MoEFCC is crucial because 63% of the forest area of the Cauvery Wildlife Sanctuary will be submerged.
  • In 2018, Tamil Nadu approached the Supreme Court (SC) against the project even if Karnataka had held that it would not affect the flow of water to Tamil Nadu.
  • In June 2020, during the Cauvery Water Management Authority’s meeting, Tamil Nadu reiterated its opposition to the project.
• Reasons for Opposition by Tamil Nadu:
  
  • Tamil Nadu is opposed to any project being proposed in the upper riparian unless it was approved by the SC.
  • Karnataka has no right to construct any reservoir on an inter-state river without the consent of the lower riparian state i.e. Tamil Nadu in this case.
    
    • The project is against the final order of the Cauvery Water Disputes Tribunal (CWDT) in which the SC held that no state can claim exclusive ownership or assert rights to deprive other states of the waters of inter-state rivers.
  • The CWDT and the SC have found that the existing storage facilities available in the Cauvery basin were adequate for storing and distributing water so Karnataka’s proposal is ex-facie (on the face of it) untenable and should be rejected outright.
  • It has also held that the reservoir is not just for drinking water alone, but to increase the extent of irrigation, which is in clear violation of the Cauvery Water Disputes Award.

Cauvery River Dispute

• River Cauvery (Kaveri):
  
  • It is known as ‘Ponni’ in Tamil also known as Ganga of the south, and it is the fourth largest river of southern India.
  • It is a sacred river of southern India. It rises on Brahmagiri Hill of the Western Ghats in southwestern Karnataka state, flows in a southeasterly direction through the states of Karnataka and Tamil Nadu, and descends the Eastern Ghats in a series of great falls and drains into Bay of Bengal through Pondicherry.
  • Some of its tributaries are Arkavathi, Hemavathi, Lakshmana Theertha, Shimsa, Kabini and Harangi.
• The Dispute:
  
  • Historical Background:
    
    • As the river originates in Karnataka, flows through Tamil Nadu with major tributaries coming from Kerala and drains into Bay of Bengal through Pondicherry the dispute therefore involves 3 states and one Union Territory.
    • The genesis of the dispute is 150 years old and dates back to the two agreements of arbitration in 1892 and 1924 between the then Madras presidency and Mysore.
    • It entailed the principle that the upper riparian state must obtain consent of lower riparian state for any construction activity viz. reservoir on the river Cauvery.
  • Recent Developments:
    
    • From 1974, Karnataka started diverting water into its four newly made reservoirs, without the consent of Tamil Nadu resulting in a dispute.
    • To resolve the matter, the CWDT was established in 1990 which took 17 years to arrive at the final order (2007) on how Cauvery water should be shared between the 4 riparian states in normal rainfall conditions.
    • In distress years, a pro-rata basis shall be used, it instructed. The government again took 6 year and notified the order in 2013.
    • This was challenged in SC which directed Karnataka to release 12000 cusecs of water to Tamil Nadu prompting protests in the State.
    • The final verdict of the SC came in 2018 where it declared the Cauvery a national asset and largely upheld the water-sharing arrangements finalised by the CWDT and also reduced the allocation of water from Karnataka to Tamil Nadu.
      
      • As per the SC, Karnataka would get 284.75 thousand million cubic feet (tmcft), Tamil Nadu 404.25 tmcft, Kerala 30 tmcft and Puducherry 7 tmcft.
      • It also directed the Centre to notify the Cauvery Management Scheme. The central government notified the ‘Cauvery Water Management Scheme’ in June 2018, constituting the ‘Cauvery Water Management Authority’ and the ‘Cauvery Water Regulation Committee’.

Way Forward

• The states need to shed the regional approach as the solution lies in cooperation and coordination, not in conflict. The planning must be done at the basin level to make the solution sustainable and ecologically viable.
• In the long term, there is a need to recharge the river through afforestation, river linking, etc and increased focus is needed on increasing water use efficiency viz. micro irrigation, awareness in people to prudently use water and water smart strategies.

Source:TH

Blackbuck Population Increased in Odisha

Why in News

Recently, a census carried out by the Odisha State Forest Department revealed that Odisha's blackbuck population has doubled in the last six years.

Key Points

• About Blackbuck:
  
  • The Blackbuck (Antilope cervicapra), or the Indian Antelope, is a species of antelope native to India and Nepal.
    
    • It is widespread in Rajasthan, Gujarat, Madhya Pradesh, Tamil Nadu, Odisha, and other areas throughout peninsular India.
  • It is considered as the epitome of grassland.
  • It is considered to be the fastest animal in the world next to Cheetah.
  • The blackbuck is a diurnal antelope (active mainly during the day).
  • It has been declared as the State Animal of Punjab, Haryana, and Andhra Pradesh.
  • Cultural Importance: It is a symbol of purity for Hinduism as its skin and horns are regarded as a sacred object. For Buddhism, it is a symbol of good luck.
• Protection Status:
  
  • Wildlife Protection Act 1972: Schedule I
  • IUCN Status: Least Concern
  • CITES: Appendix III
• Threats:
  
  • Habitat Fragmentation, Deforestation, Natural Calamities, Illegal Hunting.
• Related Protected Areas:
  
  • Velavadar Blackbuck Sanctuary - Gujarat
  • Point Calimere Wildlife Sanctuary - Tamil Nadu
  • In 2017, the Uttar Pradesh State Government approved the plan of setting up the Blackbuck Conservation Reserve in the trans-Yamuna belt near Prayagraj. It would be the first conservation reserve dedicated to the blackbuck.
• Blackbuck in Odisha:
  
  • The blackbuck is known in Odisha as Krushnasara Mruga.
  • Blackbucks are confined to Balukhand-Konark coastal plain / wildlife sanctuary in Puri District; Balipadar-Bhetnoi and adjacent areas in Ganjam District.
  • As per the latest census, the antelopes numbered 7,358, compared to 2,194 in 2011.
  • Improvement of habitats, protection given by the local people and forest staff were some of the reasons for the increase of the population.
• Other Antelopes Found in India:
  
  • Barasingha/Swamp Deer, Chital/Spotted Deer, Sambar Deer, Sangai/Brow-Antlered Deer, Himalayan Serow, Barking Deer/Indian Muntjac, Nilgiri Tahr/Nilgiri Ibex, Tibetan Antelope, Himalayan Tahr, Nilgai/Blue Bull, Chinkara/Indian Gazelle.

Source: DTE

Begum Sultan Jahan

Why in News

Recently, the death anniversary of Begum Sultan Jahan was observed.

• She was a Philanthropist, Prolific writer, Feminist, Symbol of Women Empowerment, First female Chancellor of Aligarh Muslim University.

Key Points

• Birth: In 1858 (Bhopal).
• Ruler of Bhopal:
  
  • She was the last Begum of Bhopal. Ruled from 1909 to 1926 after which she was succeeded by her son.
    
    • Fourth female ruler of Bhopal.
  • Set up the municipality system, introduced municipal elections and constructed a walled city and a palace for herself.
  • Took steps for improving public health, sanitation, and water supply in the walled city and implemented widespread vaccination drives for its residents.
• Feminist Icon:
  
  • Her progressive policies for women, at a time when they were shackled by the forces of patriarchy, have made her a feminist icon even today.
  • Constructed a Meeting Hall for Ladies in Lahore in 1913.
  • Organised an exhibition called ‘Numaish Masunuaat e Hind’ in Bhopal to encourage women and promote handicrafts.
• Philanthropist:
  
  • Established the Sultan Jahan Endowment Trust with a corpus of Rs three lakhs for helping needy students.
  • Funded a Madrasa in Deoband (UP), Nadwatul Uloom in Lucknow and even Madarsa Sultania in Mecca, Saudi Arabia.
  • Institutions such as Lady Hardinge Medical College, Delhi and some renowned colleges in Bombay and Calcutta received generous grants from her.
• Educationist:
  
  • Authored 41 books, translated a number of English books into Urdu.
  • Authored a book, Dars-e-Hayat, about the education and parenting of young girls.
  • Revamped the syllabus and added subjects such as English, Urdu, Arithmetic, Home Science and crafts of the Sultania School she started.
  • Started a nursing school called Lady Minto Nursing School.
  • She was the first women chancellor of AMU (Aligarh Muslim University).
    
    • During AMU’s centenary celebrations in December 2020, the Prime paid tribute to Begum Jahan and her contribution to the historic institution.
• Death: 12^th May 1930.

Source: IE