UPSC Key- April 7, 2023: Know about Paused Repo Rate, Gas Pricing in India, Legislative Council, NGOs and FCRA

RBI surprises with a pause, keeps repo rate unchanged at 6.5%

Syllabus:

Preliminary Examination: Economic and Social Development-Sustainable Development, Poverty, Inclusion, Demographics, Social Sector Initiatives, etc.

Mains Examination: General Studies III: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment

Key Points to Ponder:

• What’s the ongoing story– After raising repo rate in six consecutive policies, the Reserve Bank of India (RBI), in a surprise move, decided to pause its rate hike cycle on Thursday amid rising concerns over global financial stability. It was widely expected that the RBI would raise the repo rate by 25 bps and then go for a pause.

• The RBI’s move will give a breather to borrowers-Why?

• What happens when RBI hikes repo rate?

• What happens when RBI decreases repo rate?

• “The MPC decided to keep the policy repo rate unchanged at 6.5 per cent”-What is the rationality given by RBI?

• What is repo rate?

• What is the Current Repo Rate?

• What is Cash Reserve Ratio (CRR) Rate?

• How this move will impact overall Economy?

• What does accommodative stance mean with respect to monetary policy?

• What is Monetary Policy Framework?

• The latest monetary policy review was significant for a variety of reasons-Why?

• What are the steps taken by RBI to control inflation?

• What is Monetary policy?

• What is the primary objective of the monetary policy?

• There are two aspects to any monetary policy-What are they?

• The Monetary Policy Committee (MPC) is a Statutory Body-True or False?

• Under Section 45ZB of the amended (in 2016) RBI Act, 1934, the central government is empowered to constitute a six-member Monetary Policy Committee (MPC)- What is the Monetary Policy Committee (MPC)?

• What is the composition of Monetary Policy Committee (MPC)?

• Try to Comprehend-In any economy, the main role of the central bank is to maintain price stability. In other words, the primary goal is to contain inflation. The inflation rate for any period (month, quarter or year) is the rate at which the general price level has gone up. If the overall price level — typically calculated by an index (such as the Consumer Price Index) that has the prices of different commodities — in a particular month is 5% more than what it was in the same month last year, then inflation rate is said to be 5%. The targeted level of inflation varies from one country to another. In the US, this target is 2%. In India, the law demands RBI to target 4%. But apart from the exact target, the law also provides a comfort zone — 2% to 6% — within which the inflation can stray. These numbers are decided based on research that suggests the ideal rate of inflation most conducive to sustained economic growth. since late 2019, the RBI has rarely come close to the target rate. Worse still, the headline inflation has stayed outside the upper limit for the better part of the past 14 months.

• Why RBI is not able to control inflation in recent times?

• The amended RBI Act, 1934 provides for the inflation target be set by the Government of India, in consultation with the Reserve Bank, once in every five years-What is inflation target?

• Know the Types of Inflation like Moderate Inflation, Galloping Inflation, Hyper-Inflation, Stagflation, Deflation, Core Inflation, Headline Inflation etc.

• What are the causes of Inflation in the present situation

• How Inflation is Measured in India?

• What are the various Instruments of Monetary Policy to control Inflation?

• How Inflation is Measured in India?

• What do you understand by Wholesale Price Index (WPI) and Consumer Price Index?

• What is CPI-based Inflation or Retail Inflation?

• The base year of Wholesale Price Index (WPI)?

• Base Year for Consumer Price Index (CPI)?

• Impact of increase in the REPO and CRR on Money Supply on an Economy-Inflation or Deflation?

• Know about these terms-Bank Rate, Reverse Repo Rate, Liquidity Adjustment Facility (LAF), Marginal Standing Facility (MSF), Marginal cost of funds based lending rate (MCLR) etc.

• New Standard for Measuring Inflation in India and Old Standard for Measuring Inflation-Key Differences

• Do You Know-Monetary policy essentially deals with the supply and cost (interest rates) of money in an economy. The RBI’s MPC meets every two months to assess the state of monetary activities, and may tweak the repo rate — the interest rate at which the RBI lends to commercial banks — in a manner that reduces price fluctuations in the economy while keeping the inflation rate (the rate at which the general price level in the economy grows) at a reasonable level.

Other Important Articles Covering the same topic:

📍A pause in the cycle

📍READING THE PAUSE

📍Rate hike paused: Two ways to read RBI’s latest monetary policy

Alleging violations of FCRA, Home for CBI probe into Oxfam

Syllabus:

Preliminary Examination: Indian Polity and Governance-Constitution, Political System, Panchayati Raj, Public Policy, Rights Issues, etc.

Main Examination: General Studies II: Development processes and the development industry —the role of NGOs, SHGs, various groups and associations, donors, charities, institutional and other stakeholders.

Key Points to Ponder:

• What’s the ongoing story– Two years after rejecting Oxfam India’s application for renewing its Foreign Contribution (Regulation) Act (FCRA) registration, the Ministry of Home Affairs (MHA) on Thursday recommended a CBI inquiry into alleged FCRA violations by the global non-profit organisation.

• What does Oxfam do in India?

• For Your Information-Oxfam India, according to its website, is a member of the global confederation of 21 Oxfams across the world. In 2008, Oxfam India became an independent affiliate and an Indian NGO. Oxfam took stock of the states it was needed the most in and started working on the ground in the six poorest states of India—Uttar Pradesh, Jharkhand, Bihar, Chhattisgarh, Assam, and Odisha. The Government registered Oxfam India as a “non-profit organization under Section 8 of the Indian Companies Act, 2013.” In the last ten years, Oxfam India has responded to disasters in Assam, Bihar, Uttar Pradesh, Kerala, Kashmir, Manipur, Gujarat, Tamil Nadu, West Bengal, Odisha. They have also provided aid to Internally Displaced Persons during Kargil War, Muzaffarnagar violence, Kokrajhar violence, and others.

• Which reports are published by Oxfam?

• What is ‘pressure group’?

• What is Non-governmental Organizations?

• What are the legislations which regulates the finances of NGOs in India?

• A large number of Non-governmental Organizations (NGOs )exist in India-Can you recall some of those?

• Relationship between Government and Non-governmental Organizations -Analyse

• Is Oxfam a pressure group or Non-governmental Organization or Charity?

• What is difference between charity and Non-Governmental Organization (NGO)?

• Know the terms and differences between them- Non-Governmental Organization, Non-Profit Organization Charity Organization, Pressure Group and Social Enterprise

• NGOs and FCRA-why most of the NGOs are brought under FCRA?

• Foreign Contribution (Regulation) Act (FCRA)-What and When it was enacted?

• Rationality behind the enactment of Foreign Contribution (Regulation) Act (FCRA)

• Foreign Contribution (Regulation) Act, 2010 and Foreign Contribution Regulation (Amendment) Rules 2020-Key Changes

• What is foreign contribution defined in Section 2(1)(h) of FCRA, 2010?

• What is a foreign source?

• Can NGOs use the foreign contributions for investment in Mutual Funds and other speculative investments?

• Who can receive foreign contribution?

• Who cannot receive foreign contribution?

• Are there any banned organisations from whom foreign contribution should not be accepted?

• Whether donation given by Non-Resident Indians (NRIs) is treated as ‘foreign contribution’?

• Whether foreign remittances received from a relative are to be treated as foreign contribution as per FCRA, 2010?

Other Important Articles Covering the same topic:

📍 Explained: What is FCRA, the law related to NGO funding which certain MHA officials are accused of violating?

📍‘Functioning being hampered’: Oxfam India tells Delhi HC in plea against non-renewal of FCRA registration by Centre

Previous Year Mains Question Covering same Theme:

📍Examine critically the recent changes in the rules governing foreign funding of NGOs under the Foreign Contribution (Regulation) Act (FCRA), 1976. (Please refer GS-II Paper, 2015)

IN PARLIAMENT

UP: BJP now eyes road to Muslim support via Legislative Council

Syllabus:

Preliminary Examination: Indian Polity and Governance-Constitution, Political System, Panchayati Raj, Public Policy, Rights Issues, etc.

Mains Examination: General Studies II: Parliament and State legislatures—structure, functioning, conduct of business, powers & privileges and issues arising out of these.

Key Points to Ponder:

• What’s the ongoing story- WITH THE recent nomination of Aligarh Muslim University Vice-Chancellor Tariq Mansoor, the BJP now has four Muslim members in the Uttar Pradesh Legislative Council, its highest, as well as the highest for all parties, including the Samajwadi Party (which has 2 MLCs).

• How many bicameral legislatures are there in India?

• What is Bicameral legislature?

• Difference between Unicameral and Bicameral legislature-Know in detail

• In the states having bicameral system, the state legislature consists of?

• The Constitution provides for the abolition or creation of legislative councils in states-True or False?

• Legislative Council-What was the rationality given in the Constituent Assembly?

• Legislative Council-Know its Composition and role

• How members of the legislative council are elected?

• What is the maximum strength of the council?

• The Constitution has fixed the maximum and the minimum limits and the actual strength of a Council-True or false?

• Know the manner of election for the Legislative Council

• 5/6 of the total number of members of a legislative council are
indirectly elected by whom and how?

• 1/6 are nominated by the governor-Know the criteria for the nominated members

• The members are elected in accordance with the system of proportional representation by
means of a single transferable vote-True or False?

• Analyse the constitutional position of the council as compared with the assembly

• In what all matters, the powers and status of the council are broadly equal to that of the assembly?

• In what all matters, the powers and status of the council are unequal to that of the assembly?

• Do Rajya Sabha and Vidhan Parishads have similar powers?

• Know Article 168, 171 182, 183 of the Constitution

Other Important Articles Covering the same topic:

📍West Bengal wants Upper House back: how states have Councils

📍Legislative Council in states: What it entails, where it’s available and how

GOVT & POLITICS

Gas pricing formula revised: CNG, PNG to cost 10% less

Syllabus:

Preliminary Examination: Economic and Social Development-Sustainable Development, Poverty, Inclusion, Demographics, Social Sector Initiatives, etc.

Mains Examination: General Studies III: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment

Key Points to Ponder:

• What’s the ongoing story– IN A major relief to consumers across the country, piped natural gas (PNG) and compressed natural gas (CNG) are set to cost less as the government on Thursday approved a new method to fix the price of natural gas. This was announced by Union Information and Broadcasting Minister Anurag Thakur after a meeting of the Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi.

• Piped natural gas (PNG) and compressed natural gas (CNG)-What are they?

• What will happen now?

• For Your Information-Natural gas produced from legacy or old fields will now be indexed to crude oil price, instead of pricing it based on gas prices in surplus nations such as the US, Canada and Russia, Thakur told reporters. The Union Cabinet has approved the revised domestic natural gas pricing guidelines for gas produced from nomination fields of ONGC/OIL, New Exploration Licensing Policy (NELP) blocks and pre-NELP blocks, where production sharing
contract provides for government’s approval of prices, a government statement said.

• What is crude oil?

• How is gas price decided in India?

• What is the Current Gas Pricing in India?

• Do You Know-Currently, the domestic gas prices are determined as per the 2014 Domestic Gas Pricing Guidelines, which provides for declaration of prices for a six-month period based on the volume weighted prices prevailing at four gas trading hubs — Henry Hub, Albena, National Balancing Point (UK), and Russia for a period of 12 months and a time lag of a quarter.

• What is the difference between Open Acreage Licensing Programme (OALP), New Exploration Licensing Policy (NELP) and Hydrocarbon Exploration and Licensing Policy (HELP)?

• For Your Information-According to the Government, the new guidelines are intended to ensure a stable pricing regime for domestic gas consumers while at the same time provide adequate protection to producers from adverse market fluctuation with incentives for enhancing production.
The government aims to increase the share of natural gas in primary energy mix in India from the current 6.5 per cent to 15 per cent by 2030, the statement said, adding that the reforms will help expand the consumption of natural gas and contribute to achieving the target of emission reduction and ‘net zero’. The reduced prices will also lower the fertiliser subsidy burden and help the domestic power sector, the government said. The provision of a floor in gas prices as well as provision for 20 per cent premium for new wells will incentivise ONGC and OIL to make additional long-term investments, leading to greater production of natural gas and consequent reduction in import dependence on fossil fuels. The growth of the gas-based economy will also lower the carbon footprint, it said.

Other Important Articles Covering the same topic:

📍Govt kicks off review of gas price formula

📍Cheaper gas: why, how, and what’s in it for you

Cabinet approves space policy to streamline private participation

Syllabus:

Preliminary Examination: Current events of national and international importance.

Mains Examination: 

• General Studies II: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

• General Studies III: Awareness in the fields of IT, Space, Computers, robotics, nanotechnology, bio-technology and issues relating to intellectual property rights.

Key Points to Ponder:

• What’s the ongoing story- Three years after opening up the space sector to private players, the Union Cabinet on Thursday approved the Indian Space Policy 2023 to streamline the process of participation by private players. The policy will clearly state the roles and responsibilities of not only private players but also bodies such as the public-private mediator IN-SPACe and the commercial arm of the department, New Space India Limited.

• The Indian Space Policy 2023-Know key highlights

• Although a move in the right direction, the policy is still short of a Bill that can provide legal framework for commercial use of space-Know the drawbacks of this policy

• For Your Information-A consolidated space policy has been long anticipated to clarify roles and ways of participation of the government space agency, start-ups, and industries. Although the Indian National Space Promotion and Authorisation Centre set up in 2020 provided a single window for all approvals and resource sharing, these came on case to case basis.
Since the space sector was opened up to private players in 2020, over 200 space start-ups have come up in the country and many of them are also working towards providing launch services. Private company Skyroot Aerospace has already conducted a sub-orbital flight with its solid fuel based single-stage Vikram S rocket.

• How India’s first privately developed launch vehicle will be Beneficial for India’s Space Sector?

• What about Foreign Investment in Space sector?

• Is there any Government initiatives taken so far in this regard?

• What are the advantages and disadvantages of private players in the space sector?

• What is Indian National Space Promotion and Authorization Center or IN-SPACe?

• Indian Space Research Organisation (ISRO)-About the Organisation

• Know about India’s satellite launch vehicles

• Do You Know-The Cabinet also approved setting up of LIGO (Laser Interferometer Gravitational-Wave Observatory) at Maharashtra’s Hingoli. The observatory is meant to detect and track cosmic gravitational waves. Minister Jitendra Singh said there were only two LIGO observatories in the world, both of them in the US, before India signed an MoU in 2016.

Other Important Articles Covering the same topic:

📍India’s first private rocket signals a foray into a field dominated by governments

📍India’s first private launch vehicle all set for maiden flight

EXPRESS NETWORK

Pak responds to India’s notice on Indus Waters Treaty review

Syllabus:

Preliminary Examination: Current events of national and international importance

Mains Examination: General Studies II: India and its neighbourhood- relations.

Key Points to Ponder:

• What’s the ongoing story-India on Thursday said it has received Pakistan’s response to its notice sent over two months ago seeking a review and modification of the 62-year-old Indus Waters Treaty (IWT) for management of cross-border rivers. The Ministry of External Affairs spokesperson Arindam Bagchi said the Pakistan Foreign Ministry on April 3 forwarded the letter that was written by Pakistan’s Indus Water Commissioner to his Indian counterpart.

• Why Indus Water Treaty (IWT) is in news?

• What is the Indus Waters Treaty?

• Indus Waters Treaty-Know the key Provisions

• Map Work-Mark Indus River, Jhelum, Chenab, Ravi, Beas and Sutlej

• Quick Recall-India issued the notice to Pakistan on January 25 seeking a review and modification of the Indus Waters Treaty (IWT) following Islamabad’s “intransigence” in handling disputes. India took the significant step of sending the notice to Pakistan conveying its intent to amend the treaty around months after the World Bank announced appointing a neutral expert and a chair of Court of Arbitration to resolve the differences over the Kishenganga and Ratle hydroelectric projects. India has been particularly disappointed over the appointment of the Court of Arbitration.

• What are the issues and Challenges with Indus Water Treaty (IWT)?

• Indus Water Treaty and Geopolitical Conflict between India and Pakistan in present context-Know in Detail

• What is the concept of water diplomacy?

• Water diplomacy between India and Pakistan-Know in detail

• For Your Information-Under Article 60 of the Vienna Convention on the Laws of the Treaties, a party can criticise an agreement and give notice of its intention to terminate it if the other party violates its fundamental provisions. India has adopted the moderate approach of not terminating but modifying the Indus Water Treaty (IWT).

• ‘New Delhi claims that Islamabad has violated the dispute settlement mechanisms, as mandated by Articles 8 and 9 of the Treaty’-Elaborate

• Do You Know-Article 8 specifies the roles and responsibilities of the Permanent Indus Commission — a regular channel of communication for matters relating to the implementation of the Treaty. Article 9 is relevant for addressing any difference or dispute that might emerge between the two countries. Article 9 offers a graded pathway to address any issue related to the implementation or interpretation of the IWT — for instance, it provides for the appointment of a neutral expert in case there is a lack of consensus among the Commissioners. If the neutral expert believes that the difference should be treated as a dispute, it can be referred to the Court of Arbitration. However, it adds that the Commission has to report the facts to the two governments.

Other Important Articles Covering the same topic:

📍Indus Water Treaty at 60: why there is a need to give it a fresh look

Previous year Prelims Question Based on similar theme:

📍With reference to the Indus River system, of the following four rivers, three of them pour into one of them which joins the Indus direct. Among the following which is one is such river that joins the Indus direct? (UPSC Prelims GS-1, 2021)
a. Chenab
b. Jhelum
c. Ravi
d. Sutlej

Food Secy: Confident of achieving wheat procurement target

Syllabus:

Preliminary Examination: Economic and Social Development-Sustainable Development, Poverty, Inclusion, Demographics, Social Sector Initiatives, etc.

Mains Examination: General Studies III: Indian Economy and issues relating to planning, mobilisation of resources, growth, development and employment, Major crops-cropping patterns in various parts of the country

Key Points to Ponder:

• What’s the ongoing story-Stating that there may be “marginal” loss in wheat production due to unseasonal rain, Food Secretary Sanjeev Chopra on Thursday said there is no need to panic, as there is no major loss in production. Chopra told the media that nearly 2.5 lakh metric tonnes to 3 lakh metric tonnes of wheat has been procured under the Central pool so far, much of this from Madhya Pradesh.

• Wheat Production in India-Rabi or Kharif Crop?

• How does the government procure wheat?

• What is the procurement scale against the total production of wheat in India?

• From how many states is wheat procured for the central pool?

• How much wheat is procured for the central pool by the FCI every year?

• What is the procurement scale against the total production of wheat in India?

• What is the share of wheat contribution of various states to the central pool?

• Wheat production in India-Know the statistics

• India’s Wheat Exports-What are the Issues and Challenges?

• India’s wheat exports in terms of volume-Know the Statistics

• Wheat Production in India-Know all the facts like Highest producing States, Geography and Environment associated with Wheat Production like Soil, temperature, Rainfall and Humidity etc.

• MSP (minimum support price) and effectiveness of MSP implementation

• How MSP is calculated (paid out costs, labour etc.) and Crops covered under the MSP

• Food Corporation of India (FCI)-About, Role, Functions

• Do You Know-Under the Rice Fortification Programme, 269 districts in 27 states have started distributing fortified rice under Targeted Public Distribution System (TPDS), achieving a 100% target set for Phase II by March 2023.

• What is rice fortification scheme?

• How does the extrusion technology to produce fortified rice kernels work?

• What are the standards for fortification?

• What is India’s capacity for fortification?

• How can a beneficiary distinguish between fortified rice and regular rice?

Other Important Articles Covering the same topic:

📍Explained: What is fortified rice, and how is it prepared?

📍Export avenue for farmers

EXPLAINED

Revising school textbooks

Syllabus:

Preliminary Examination: Indian Polity and Governance-Constitution, Political System, Panchayati Raj, Public Policy, Rights Issues, etc.

Mains Examination: General Studies II: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Key Points to Ponder:

• What’s the ongoing story– The NCERT textbooks are the centre of yet another political controversy with the incumbent government being accused of rewriting history taught to students in schools. What provoked this latest controversy and why have textbooks become a battleground for competing ideologies over the years?

• Is this the first revision of textbooks since the NDA government came to power in 2014?

• Why has the most recent round of revisions caused such a huge controversy when the first two rounds went virtually unnoticed?

• Is it true that school textbooks of history no longer include the Mughal Empire?

• Have there been controversies around NCERT textbooks earlier?

• OK, but how does changing school textbooks benefit parties in power?

• How the content of NCERT textbooks are decided?

• Who decides the content of NCERT textbooks?

• Who writes the NCERT books?

• Who prepares the National Curriculum Framework for school education?

• What are some of the key changes carried out in the textbooks?

• “History is always written by the winners”-How this statement is relevant in present Context?

• How ‘ideology’ influenced the course of Indian history?

• Indian history has faced massive distortions from the time of British rule-How far you agree with this statement?

• What are the most sweeping changes in social science school textbooks since 2014 in India?

• Do You Know-Education as a subject comes under both the state and central governments according to the Constitution, meaning both the states and central governments have a role to play here. Further, India has multiple education boards across the country that decide crucial matters such as conducting exams and deciding the syllabus in schools. State education boards, the Central Board of Secondary Education (CBSE), Council for the Indian School Certificate Examinations (CISCE), are a few examples. They are autonomous or independent bodies. They make decisions based on the guidelines laid down by The National Council of Educational Research and Training (NCERT). An autonomous organisation, set up in 1961 by the government “to assist and advise the Central and state governments” for improving the quality of education, NCERT’s objectives include the task of preparing and publishing model textbooks. Its chairman is appointed by the central government. For deciding the content of textbooks, the NCERT is currently preparing a document called the National Curriculum Framework (NCF). It was last prepared in 2005 under the UPA government, and before that, it was revised in 1975, 1988 and 2000. The NCF will have broad guidelines for the revised syllabus that will be followed by the boards for their textbooks.

• Growth of Education in India: Historical Background from Vedic Period to British Period

• Growth of Education in the Post-Independence Period-Reforms taken so far

• Education was initially a state subject but following an amendment (42nd) to the Constitution in 1976, it became a concurrent subject-True or False?

Other Important Articles Covering the same topic:

📍History textbook deletions: Why NCERT argument that it is trying to reduce pressure on students is weak

Attention Please:

Are you Prelims ready? The countdown for UPSC CSE 2023 has begun. Check your progress and revise your topics through daily quiz as the UPSC Essentials brings to you its new initiative of subject-wise quizzes. UPSC Daily Subject Quiz will cover all topics under UPSC Civil Services syllabus like Polity, History, Geography, Economics, Environment, Science and Technology, International Relations, and more. These quizzes are designed to help you revise some of the most important topics from the static part of the syllabus.

Each day one new subject will be covered. Attempt today’s subject quiz on Environment, Geography, Science and Technology to check your progress. Come back tomorrow to solve the weekly current affairs quiz and MCQs on the Economy on Monday.. Don’t miss checking the answers and explanations at the end of the quiz.

For any queries and feedback, contact priya.shukla@indianexpress.com
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