CURRENT AFFAIRS – 10/04/2024
Contents
CURRENT AFFAIRS – 10/04/2024
BSE market cap hits Rs. 400L Cr for the first time
(General Studies- Paper III)
Source : The Indian Express
Despite recent warnings by the market regulator, Securities and Exchange Board of India (Sebi), regarding a potential “froth” in Indian equities, the market capitalisation (m-cap) of companies listed on the Bombay Stock Exchange (BSE) has surpassed the landmark Rs 400 lakh crore mark for the first time.
- This significant valuation milestone coincided with a notable rally in benchmark indices, with the BSE Sensex nearing the 75,000 mark and the NSE Nifty50 exceeding the 22,600 level.
Key Highlights
- Rapid Growth in Market Capitalisation
- The domestic market’s m-cap, now equivalent to 1.33 times the size of India’s GDP, continues to demonstrate remarkable resilience against global economic slowdown, experiencing exponential growth and accumulating trillions at a record pace. Notably, it took only nine months, the shortest interval ever recorded, for the combined m-cap to increase by Rs 100 lakh crore, reaching the Rs 300-lakh-crore mark in July 2023.
- Historical Growth Trends
- The growth trajectory of the market capitalisation reveals the rapid expansion of India’s equity market.
- It took approximately two years and five months for the m-cap to escalate from Rs 200 lakh crore to Rs 300 lakh crore, and nearly seven years for it to advance from Rs 100 lakh crore to Rs 200 lakh crore.
- The BSE’s combined m-cap initially reached Rs 100 lakh crore in March 2014, coinciding with the general election of 2014.
- Expectations of Continued Growth
- Despite concerns raised by Sebi and the pace of recent growth, experts remain optimistic about the market’s outlook.
- Favorable election results, anticipated normal monsoon conditions, and expected rate cuts by the Federal Reserve are factors likely to spur further buying activity in the coming months.
- Moreover, the long-term growth prospects for the Indian market are considered promising, indicating that there is still potential for sustained expansion in the future.
About the Bombay Stock Exchange (BSE)
- The Bombay Stock Exchange (BSE) is the oldest stock exchange in Asia and the tenth oldest in the world, having been established in 1875 by cotton merchant PremchandRoychand.
- It is located on Dalal Street in Mumbai, which is known as the Wall Street of India.
- The BSE is the world’s 8th largest stock exchange with a market capitalization exceeding US$4.5 trillion as of January 2024.
- The BSE was founded by PremchandRoychand in 1875, initially as an informal group of brokers who met under a banyan tree near the Mumbai Town Hall.
- In 1874, the brokers found a permanent location and became an official organization known as “The Native Share & Stock Brokers Association”.
- The BSE was demutualized and corporatized on 19 May 2007, pursuant to the BSE (Corporatization and Demutualization) Scheme, 2005 notified by SEBI.
- It was listed on NSE on 3 February 2017.
- The BSE has a market capitalization of ₹ 366 trillion (US$ 4.6 trillion) as of January 2024, with 5,309 listings.
- It is a Partner Exchange of the United Nations Sustainable Stock Exchange initiative, joining in September 2012.
- The BSE established India INX on 30 December 2016, which is the first international exchange of India.
- The BSE offers various indices, including the S&P BSE SENSEX, S&P BSE BANKEX, and S&P BSE SENSEX 50.
About the Securities and Exchange Board of India (Sebi)
- The Securities and Exchange Board of India (SEBI) is the regulatory body for the securities market in India.
- It was established in 1988 as a non-statutory body and was given statutory powers through the Securities and Exchange Board of India Act, 1992.
- SEBI is responsible for protecting the interests of investors in securities and promoting the development of the securities market.
- It regulates stock exchanges, mutual funds, and other intermediaries in the securities market.
- SEBI has the power to register and regulate the activities of intermediaries, set listing and disclosure standards for companies, and enforce compliance with securities laws.
- It also has the power to investigate and penalize violations of securities laws.
- SEBI is headquartered in Mumbai and has regional offices in Delhi, Kolkata, Chennai, and Ahmedabad.
The climate crisis is not gender neutral
(General Studies- Paper II and III)
Source : The Hindu
The climate crisis presents a pressing global challenge, exacerbating existing inequalities and disproportionately affecting vulnerable groups, particularly women and girls.
- Various factors, including poverty, cultural norms, and traditional gender roles, intersect to magnify the adverse effects of climate change on women’s health, livelihoods, and overall well-being.
Key Highlights
- Disproportionate Health Risks for Women and Girls
- Women and girls face significantly higher health risks due to the climate crisis, especially in impoverished circumstances.
- According to the United Nations Development Programme (UNDP), they are 14 times more likely than men to die in disasters.
- This increased vulnerability stems from their roles within communities, limited access to resources, and socioeconomic disparities.
- Impact on Livelihoods: Agriculture and Beyond
- Agriculture serves as a critical livelihood for women in India, particularly in rural areas.
- However, climate-driven disruptions, such as crop yield reductions, exacerbate food insecurity, disproportionately affecting poor households.
- Within these households, women bear the brunt of increased domestic work burdens, worsened health outcomes, and heightened risks of intimate partner violence.
- Effects on Physical and Mental Health
- The compounding effects of food and nutritional insecurity, alongside heightened work burdens and income uncertainties, significantly impact women’s physical health and mental well-being.
- These challenges contribute to a vicious cycle of poor health outcomes and socio-economic vulnerability, further deepening existing disparities.
- Extreme Events and Gender-Based Violence
- The rising frequency of extreme weather events and climate-induced disasters poses a direct threat to women’s safety and well-being.
- Studies suggest a correlation between natural disasters and increased incidents of gender-based violence against women.
- Moreover, changes in water cycle patterns, resulting from extreme weather events, exacerbate challenges in accessing safe drinking water, further burdening women and girls with increased drudgery and reduced time for productive activities and healthcare.
- Impact of Climate Change on Women’s Health
- The past decade has witnessed record-breaking temperatures globally, with countries like India facing unprecedented heatwaves.
- Prolonged exposure to extreme heat poses severe health risks, particularly for vulnerable groups such as pregnant women, young children, and the elderly.
- Pregnant women face an increased risk of preterm birth and eclampsia due to extreme heat, while exposure to air pollutants exacerbates respiratory and cardiovascular diseases in women and unborn children.
- Emerging data from Indian cohort studies highlight the alarming impact of air pollution on health outcomes, including increased risks of lung cancer, cardiovascular deaths, stroke, and dementia.
- Intersectional Vulnerability: Not All Women Are Equally At Risk
- Despite the overarching gender dimension of climate change, vulnerability varies among different sub-groups of women within the same geographic or agro-ecological zone.
- There is a pressing need for deeper exploration of intersectionalities to identify and protect the most vulnerable sub-groups effectively.
- Understanding the complex interplay of factors contributing to vulnerability is crucial for targeted climate adaptation and mitigation strategies.
- Importance of Women in Climate Action
- Achieving the goals of the Paris Agreement, particularly limiting global temperature rise to 1.5°C, necessitates the involvement of 100% of the population, including women.
- Empowering women is not only essential for equitable climate action but also leads to more effective climate solutions.
- Studies show that when women have equal access to resources, agricultural yields increase by 20% to 30%.
- Moreover, tribal and rural women have been instrumental in environmental conservation efforts, underscoring the importance of including women and women collectives, such as Self-help Groups and Farmer Producer Organisations, in climate initiatives.
- Local Solutions and Adaptation
- Empowering women with knowledge, tools, and access to resources fosters the emergence of local solutions to climate challenges.
- Adaptation measures must recognize the diverse contexts of rural and urban areas, considering variations in exposure to heat, air pollution, and access to water and food.
- Encouraging the participation of women in decision-making processes at local levels enhances the effectiveness and sustainability of climate adaptation strategies tailored to specific community needs.
- Legal Recognition of Climate Rights
- Recent legal developments, such as the Supreme Court of India’s ruling, acknowledge people’s right to be free from the adverse impacts of climate change.
- The right to a clean environment is recognized as a fundamental human right, falling within the broader ambit of the right to life.
- Such legal recognition signifies a growing acknowledgment of the urgent need to address climate-related challenges.
- Addressing Heatwaves: Immediate Actions
- Immediate action is necessary to mitigate the impact of prolonged heatwaves, especially on vulnerable groups such as outdoor workers, pregnant women, infants, children, and the elderly.
- Excess deaths during heatwaves are often overlooked, leading to significant loss of productivity and economic consequences.
- To minimize fatalities, urban local bodies and district authorities in vulnerable areas must implement heatwave preparedness plans.
- These plans should include heatwave warnings, adjusted outdoor work and school timings, cooling rooms in health facilities, public drinking water facilities, and prompt treatment for heat stroke cases.
- Long-term strategies like urban planning to increase tree cover, reduce concrete, and enhance green-blue spaces are essential for mitigating heat-related risks.
- Initiatives like painting low-income housing roofs with reflective white paint have shown promising results in reducing indoor temperatures and improving quality of life.
- Water Shortage: Urgent Societal Action
- Water scarcity poses a significant threat to society’s existence and requires immediate collective action.
- India’s traditional rainwater harvesting systems need revitalization, leveraging modern technologies like geographic information systems (GIS) to map water sources, vulnerabilities, and climate hazards.
- Local plans developed through community engagement can guide the allocation of government resources to improve water access and management.
- Village-Level Interventions
- Convergence of sectors and services at the village or panchayat level is crucial for effective action.
- Empowering local governance structures like panchayats and Self-Help Groups (SHGs) through devolution of powers, finances, and capacity-building investments enables community-led resilience-building efforts.
- Gender Lens in Climate Action
- Applying a gender lens to state action plans on climate change is imperative.
- While existing plans acknowledge the impacts on women, they often portray them solely as victims, overlooking deeper gender dynamics.
- Recommendations for revising these plans emphasize moving beyond stereotypes, acknowledging vulnerabilities across genders, and implementing gender-transformative strategies.
- Women should be viewed as leaders rather than victims in climate action efforts, ensuring a comprehensive and equitable approach to adaptation and mitigation.
The ‘import restrictions’ on solar PV cells
(General Studies- Paper II)
Source : The Hindu
The Approved List of Models and Manufacturers of Solar Photovoltaic (PV) Modules, or ALMM list, is a compilation of solar module manufacturers deemed eligible for use in various government projects, government-assisted projects, and initiatives under government schemes and programs.
- This list serves as a reference for solar power projects, including those supplying electricity to both central and state governments.
Key Highlights
- Reasons for Re-implementation
- The recent decision to re-implement the ALMM list follows an order issued by the Ministry of New and Renewable Energy (MNRE) on March 29.
- While the government did not explicitly state the rationale behind this action, reports suggest that it was prompted by concerns from renewable power producers.
- These concerns stemmed from the surge in demand for solar power production equipment, particularly solar modules and cells, amid a landscape dominated by imports from China, known for its highly competitive rates.
- Context of Import Dependency
- When the ALMM list was suspended, India’s domestic renewable energy sector faced challenges in meeting the escalating demand for solar power production equipment at rates comparable to those offered by Chinese manufacturers.
- This dependency on imports posed significant challenges for domestic producers, leading to concerns about competitiveness and sustainability within the sector.
- Re-introduction and Import Substitution Efforts
- The government’s decision to reintroduce the ALMM list is founded on the belief that recent initiatives, such as the Production Linked Incentive (PLI) scheme, have bolstered the domestic sector’s production capacities and enhanced price competitiveness.
- This move is positioned as an import substitution effort aimed at reducing reliance on foreign imports, particularly from China, and promoting the growth of India’s indigenous renewable energy manufacturing ecosystem.
- India’s Reliance on Solar PV Imports
- India heavily depends on imports to meet its demand for solar cells and modules, with China and Vietnam emerging as major suppliers.
- Over the past five years, India imported approximately $11.17 billion worth of solar cells and modules, accounting for 0.4% of the country’s total exports during the same period.
- Until January 2023-24, China alone accounted for 53% of India’s solar cell imports and 63% of solar PV module imports.
- Ratings agency ICRA estimates that China holds over 80% of the manufacturing capacity across various stages of the solar PV supply chain, including polysilicon, wafer, cell, and modules.
- In contrast, India’s manufacturing capacity in this sector remains relatively low, primarily concentrated in the final manufacturing stage.
- Policy Responses to Address Import Dependence
- In response to the significant import reliance on solar PV components, India has implemented several policy measures over the past five years.
- The first notable effort was the notification of the Approved List of Models and Manufacturers of Solar Photovoltaic Modules (ALMM) order in January 2019.
- However, the issue gained prominence during the COVID-19 pandemic, which exposed severe global supply chain disruptions.
- In the Union Budget of 2022-23, Finance Minister Nirmala Sitharaman announced the ₹19,500 crore Production Linked Incentive (PLI) scheme aimed at scaling up domestic manufacturing across the entire solar supply chain, from polysilicon to solar modules.
- Additionally, the government introduced significant customs duties, with a steep 40% duty on PV modules and 25% on PV cells.
- These duties were reduced later due to several factors, including a slowdown in solar capacity additions and cost pressures on projects caused by aggressively low tariffs quoted by developers to secure power purchase contracts based on imported Chinese equipment.
- Why China Leads Solar PV Export
- According to a July 2022 report by the International Energy Agency (IEA), China has emerged as the leading exporter in the solar PV supply chain due to its unparalleled cost competitiveness.
- The IEA highlighted several factors contributing to China’s dominance in this sector, including the lower cost of power supplied to the industry.
- Electricity constitutes a significant portion of production costs, accounting for more than 40% for polysilicon and nearly 20% for ingots and wafers.
- Furthermore, Chinese government policies have prioritized solar PV as a strategic sector, fostering continuous innovation throughout the supply chain.
- The growing domestic demand has also enabled economies of scale, further enhancing China’s competitiveness in solar PV manufacturing.
- Scope for Solar in India
- India’s ambitious target of achieving 500 GW of installed capacity from non-fossil fuels by 2030 serves as a primary driver for scaling up solar power generation in the country.
- According to the IEA, India exhibits the fastest rate of growth in electricity demand among major economies through 2026, propelled by robust economic activity and increasing consumption aimed at mitigating extreme weather events.
- Solar power currently accounts for approximately one-third of all energy generated from renewables in India.
- Ministry of New and Renewable Energy (MNRE) highlighted India’s vast solar energy potential, estimated at 748.99 GW, which remains largely untapped.
- Efforts are underway by the government to harness this potential through various schemes and programs aimed at promoting solar energy adoption and production.
About the Production Linked Incentive (PLI) scheme for the solar sector in India
- The Production Linked Incentive (PLI) scheme for the solar sector in India was announced in November 2020, with the aim of building an ecosystem for manufacturing high efficiency solar PV modules in the country and reducing import dependence in the area of renewable energy.
- The scheme has an outlay of Rs. 24,000 crore and is being implemented in two tranches.
- In Tranche-I of the scheme, the Union Cabinet approved the PLI scheme for National Programme on High Efficiency Solar PV Modules, for achieving manufacturing capacity of Giga Watt (GW) scale in High Efficiency Solar PV Modules on 7th April, 2021.
- Ministry of New & Renewable Energy (MNRE) issued the Scheme Guidelines for Production Linked Incentive Scheme on ‘National Programme on High Efficiency Solar PV Modules’ on 28th April, 2021, with an outlay of Rs. 4,500 crore.
- Under this tranche, Indian Renewable Energy Development Agency Limited (IREDA), the implementing agency on behalf of MNRE for the PLI Scheme (Tranche-I), issued the Bid Documents for selection of manufacturers for setting up manufacturing capacities for High Efficiency Solar PV Modules.
- In Tranche-II of the scheme, Ministry of New & Renewable Energy, on 30.09.2022, has issued Scheme Guidelines for implementation of Tranche-II of the PLI Scheme for High Efficiency Solar PV Modules, with an outlay of Rs. 19,500 crore.
- Under this tranche, Solar Energy Corporation of India (SECI), the implementing agency on behalf of MNRE for the PLI Scheme (Tranche-II), issued the tender document for selection of Solar PV manufacturers under Tranche-II of PLI Scheme for High Efficiency Solar PV Modules.
About Indian Renewable Energy Development Agency Limited (IREDA)
- Indian Renewable Energy Development Agency Limited (IREDA) is a Mini Ratna (Category – I) Government of India Enterprise, established as a Non-Banking Financial Institution in 1987, engaged in promoting, developing and extending financial assistance for setting up projects relating to new and renewable sources of energy and energy efficiency/conservation.
- IREDA is a Public Limited Government Company under the administrative control of the Ministry of New and Renewable Energy (MNRE).
- IREDA’s long-term objective is to contribute to the development of a bond market for renewable energy projects in India.
- The Company provides financial support to projects for generating electricity through new and renewable resources, serving customers in India.
- IREDA also offers a credit enhancement guarantee scheme to support the issuance of bonds by wind and solar energy project developers, enhancing the credit rating of bonds for renewable energy projects, improving their marketability and liquidity, and attracting lower-cost and longer-term funding for project developers.
- IREDA’s financing activities include supporting green power capacity, financing the setting up of solar manufacturing units, and encouraging the use of renewable energy to foster sustainable growth.
About the Solar Energy Corporation of India (SECI)
- Solar Energy Corporation of India (SECI) is a Miniratna Category-I Central Public Sector Enterprise under the Ministry of New and Renewable Energy, Government of India.
- Established in 2011, SECI is responsible for the implementation of the National Solar Mission, which aims to promote solar energy in India.
Candidates have aright to privacy from voters, rules SC
(General Studies- Paper II)
Source : The Hindu
The Supreme Court, in a significant ruling on April 9, affirmed that election candidates possess a fundamental right to privacy from voters, and they are not obligated to disclose every aspect of their personal lives and possessions for public scrutiny.
- Justices Aniruddha Bose and Sanjay Kumar emphasized that a candidate’s decision to maintain privacy on matters irrelevant to their candidacy does not constitute a corrupt practice under the Representation of People Act, 1951, nor does it amount to a substantial defect under Section 36(4) of the Act.
Key Highlights
- Non-disclosure of Personal Details Not Deemed Corrupt Practice
- Justice Kumar, in authoring the judgment, underscored that candidates are not compelled to expose every detail of their lives for voter examination.
- He emphasized that unless certain personal possessions or aspects of a candidate’s life are directly relevant to their suitability for public office, non-disclosure does not constitute a corrupt practice or substantial defect under electoral law.
- Criteria for Determining Substantial Defects
- While acknowledging the right to privacy, the Court clarified that each case must be assessed based on its unique circumstances to determine what qualifies as a substantial defect.
- For instance, the suppression of information regarding high-value possessions, such as an expensive watch collection, would likely be considered a substantial defect.
- However, the mere ownership of ordinary, inexpensive items like simple watches may not necessitate disclosure.
- Case Specificity in Assessing Non-disclosure
- Justice Kumar emphasized the need for a case-by-case analysis to determine the significance of non-disclosure.
- Factors such as the value and relevance of undisclosed assets or possessions to the candidate’s candidacy must be considered individually.
- The judgment highlighted that while some omissions may constitute defects, others may not, depending on their nature and impact on the electoral process.
- Background of the Judgment
- The case arose from a petition filed by Arunachal Pradesh MLA KarikhoKri, who contested a Gauhati High Court decision voiding his election to the 44-Tezu Assembly Constituency of Arunachal Pradesh.
- The High Court ruled against Kri for failing to declare three vehicles as assets in his affidavit filed during elections.
- The Supreme Court’s ruling provides clarity on the extent of disclosure required from election candidates and the parameters for assessing the significance of non-disclosure.
- Background of Mr. Kri’s Election Victory
- KarikhoKri emerged victorious in the elections held on May 23, 2019, securing a seat as an Independent candidate.
- However, his victory was later challenged due to allegations of non-disclosure regarding certain vehicles in his possession during the electoral process.
- The vehicles in question included a Kinetic Zing Scooty, a Maruti Omni van utilized as an ambulance, and a TVS Star City motorcycle.
- It’s noteworthy that these vehicles had been sold, with the scooter being scrapped in 2009 and the others also subsequently sold.
- Importantly, the High Court did not investigate the statements of the buyers of these vehicles.
- Supreme Court’s Ruling
- The Supreme Court, ruling in favor of Mr. Kri, concurred with his legal representatives, including senior advocates C.A. Sundaram and Siddharth Dave, among others.
- The Court emphasized that vehicles, once sold, could not reasonably be classified as “assets” of the candidate.
- Justice Kumar, delivering the judgment, categorically stated that the non-disclosure of the aforementioned vehicles did not constitute an attempt to unduly influence voters or violate electoral laws.
- He specifically cited Section 123(2) of the Representation of People Act, 1951, clarifying that Mr. Kri’s actions did not amount to corrupt practices.
- Contextualizing Asset Declaration
- The Court further underscored that the total worth of Mr. Kri and his joint assets amounted to ₹8, 41, 33,815, with their cumulative income totaling ₹11, 72, 91,634.
- In comparison, the value of the three vehicles in question was deemed negligible.
- Voters’ Right to Information
- Highlighting the voters’ entitlement to essential information for making informed electoral decisions, the Court affirmed that candidates have an obligation to disclose relevant details that are crucial for voters’ decision-making processes.
- The judgment underscores the importance of transparency and accountability in electoral processes, ensuring that voters have access to pertinent information necessary for exercising their democratic rights effectively.
About the Representation of People Act, 1951
- The Representation of the People Act, 1951 is a legislation in India that governs the conduct of elections for the Houses of Parliament and the State Legislatures.
- Enacted on July 17, 1951, this Act provides the framework for the qualifications and disqualifications for membership of these legislative bodies, addresses corrupt practices and other offenses related to elections, and outlines the procedures for resolving doubts and disputes that may arise during the electoral process.
- Key provisions of the Representation of the People Act, 1951 include:
- Qualifications for membership of the Council of States and the House of the People.
- Qualifications for membership of State Legislative Assemblies and Councils.
- Definitions of terms like “elector” and “appropriate authority” in relation to elections.
- Prohibition of canvassing near polling stations.
- Procedures for declaring elections void or electing candidates in case of an equality of votes.
- Power to make rules and jurisdiction of civil courts in electoral matters.
- The Act aims to ensure the fair and transparent conduct of elections, uphold the integrity of the electoral process, and establish the qualifications and disqualifications for individuals seeking to become members of the Parliament and State Legislatures in India.
20 new companies bought poll bonds, a punishable offence
(General Studies- Paper II)
Source : The Hindu
Despite regulations prohibiting companies in existence for less than three years from making political contributions, recent data reveals that approximately 20 newly incorporated firms purchased electoral bonds worth about ₹103 crore.
- This significant discrepancy raises concerns about potential violations of electoral laws and regulations surrounding political financing.
Key Highlights
- Overview of Purchasing Firms
- Among these 20 firms, five were operational for less than a year, seven were one year old, and eight had only completed two years of existence at the time of their electoral bond purchases.
- Notably, many of these companies were established in 2019, a period marked by economic recession and the onset of the COVID-19 pandemic.
- Despite their relatively recent inception, these firms engaged in substantial political contributions through the acquisition of electoral bonds shortly after their incorporation.
- Historical Context of Political Contribution Regulations
- The prohibition on companies making political contributions within three years from incorporation has been a longstanding regulation, dating back nearly four decades.
- Initially introduced in 1985 through an amendment to Section 293A, this regulation was subsequently retained under Section 182 of the Companies Act, 2013.
- The amendment also removed the provision capping political donations at 7.5% of the company’s average net profit over the previous three financial years.
- However, the prohibition on political contributions by newly incorporated companies remained intact.
- Legal Ramifications of Violations
- According to Section 182 of the Companies Act 2013, companies found to have made political contributions in contravention of these regulations face severe penalties.
- Such violations could result in fines up to five times the amount contributed, and officers of the company found to be in default may face imprisonment for up to six months in addition to fines.
- Purpose of the Three-Year Rule
- The retention of the three-year rule for companies making political contributions aims to prevent shell companies from engaging in such activities.
- Concerns about the misuse of shell companies for political financing were raised by the Election Commission of India and the Reserve Bank of India (RBI) following the removal of the 7.5% cap on political donations through electoral bonds in 2017.
- The risk of potential money laundering through bearer bonds was also highlighted by the RBI.