CURRENT AFFAIRS - 17/11/2023

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CURRENT AFFAIRS – 17/11/2023

CURRENT AFFAIRS – 17/11/2023

India, US, 12 other IPEF members sign supply chain resilience agreement

(General Studies- Paper III)

Source : The Indian Express

India, along with the United States and 12 other Indo-Pacific Economic Framework (IPEF) members, has entered into a supply chain resilience agreement.

The primary objective is to reduce dependence on China and promote the shift of manufacturing for essential goods to member nations.

Key Highlights

Member Countries:
- The 14 countries forming the IPEF include India, Australia, the US, Japan, Fiji, Korea, New Zealand, Singapore, and Thailand.
- Together, these nations account for 40% of the global gross domestic product and approximately one-third of global goods and services trade.
Agreement Details:
- The supply chain resilience agreement is considered a groundbreaking international effort.
- It aims to fortify and strengthen global supply chains, fostering adaptability, stability, and sustainability.
- Negotiations on this agreement, one of the four pillars of the IPEF, were concluded in May of the current year.
Structure of IPEF:
- The Indo-Pacific Economic Framework is organized around four pillars: trade, supply chains, clean economy, and fair economy.
- India has joined all the pillars except the trade pillar.
- The members are expected to announce the conclusion of talks for the clean economy and fair economy pillars during the current week.
Supply Chain Resilience Impact:
- The agreement is expected to enhance the resilience, robustness, and integration of IPEF supply chains.
- It is anticipated to contribute significantly to the economic development and progress of the entire region.
- The pact will come into effect once any of the five member countries successfully implements the agreement.
Fair Economy Pillar:
- Under the fair economy pillar, IPEF partners are working on an agreement focused on strengthening the implementation of effective anti-corruption and tax measures.
- The goal is to boost commerce, trade, and investment among IPEF economies.
Clean Economy Pillar:
- Regarding the clean economy pillar, member countries aim to collaborate on research, development, commercialization, availability, accessibility, and deployment of clean energy and climate-friendly technologies.

More about Indo-Pacific Economic Framework for Prosperity (IPEF)

In May 2022, the United States initiated the Indo-Pacific Economic Framework for Prosperity (IPEF) in collaboration with 13 partner countries across the Indo-Pacific region.
The primary goals of the framework are to promote resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness among the 14 economies involved.
These objectives are aimed at providing tangible benefits that stimulate economic activity, encourage investment, and support sustainable and inclusive growth for workers and consumers in the region.
The IPEF is structured around four pillars, each of which has been subject to intensive discussions since its launch. The four pillars are:
- Trade
- Supply Chains
- Clean Economy
- Fair Economy
The IPEF brings together a diverse group of partner countries, representing 40 percent of global GDP and 28 percent of global goods and services trade. The 13 partner countries are:
- Australia
- Brunei Darussalam
- Fiji
- India
- Indonesia
- Japan
- Republic of Korea
- Malaysia
- New Zealand
- Philippines
- Singapore
- Thailand
- Vietnam

What is APEC?

(General Studies- Paper II)

Source : The Indian Express

The Asia-Pacific Economic Cooperation (APEC) Leaders’ Week is currently underway in San Francisco, bringing together leaders from the Asia-Pacific region.

While India is not a member of APEC, Union Minister for Commerce and Industry, Piyush Goyal, is participating in the forum, underscoring India’s engagement in regional economic discussions.

About APEC

APEC Overview:
- APEC, founded in 1989, is a regional economic forum aimed at fostering regional economic integration and greater prosperity in the Asia-Pacific.
- The 21 members are referred to as “economies,” reflecting the forum’s focus on trade and economic issues.
- Taiwan and Hong Kong attend APEC as distinct entities, despite China’s assertion of sovereignty.
- APEC has its headquarters in Singapore.
Member Economies:
- The 21 APEC economies include Australia, Brunei, New Zealand, Papua New Guinea, Hong Kong, the Philippines, Indonesia, Malaysia, Vietnam, Singapore, Thailand, Chinese Taipei (Taiwan), China, Japan, South Korea, Russia, Canada, the United States, Mexico, Peru, and Chile.
- APEC has three official observers, including the Association of Southeast Asian Nations Secretariat, the Pacific Economic Cooperation Council, and the Pacific Islands Forum Secretariat.
Historical Context:
- APEC’s establishment was influenced by the economic growth of East Asian countries in the ’80s.
- Over the years, it has served as a platform for economic cooperation, trade discussions, and addressing regional challenges.
APEC’s primary focus on trade and economic issues distinguishes it, with members engaging in discussions and initiatives to promote regional economic integration.
Role of APEC Over the Years:
- Championing Free Trade and Economic Liberalization:
  - Since its establishment in 1989, the Asia-Pacific Economic Cooperation (APEC) has consistently advocated for free trade, the reduction of trade tariffs, and economic liberalization.
  - The organization’s core objectives, outlined in the 1991 Seoul Declaration, highlighted the creation of a liberalized free trade area around the Pacific Rim as its principal goal.
- Contributions to Dynamic Growth:
  - APEC initiatives have significantly contributed to dynamic economic growth, particularly in the Asia-Pacific region.
  - According to experts from the Center for Strategic and International Studies (CSIS), the development spurred by APEC has played a crucial role in fostering a growing middle class in the Asia-Pacific, with APEC economies representing around 60% of global GDP and 48% of global trade as of 2018.
- India’s Interest and Request for Membership:
  - India has expressed interest in joining APEC and formally requested membership in 1991, coinciding with the initiation of economic reforms for liberalization and globalization by the Indian government.
  - The request was based on India’s geographical location, the potential size of its economy, and the extent of trade interactions with the Asia-Pacific.
  - However, APEC has maintained an informal moratorium on expanding membership, despite the 2015 US-India Joint Strategic Vision expressing welcome to India’s interest.

Branded, generic and the missing ingredient of quality

(General Studies- Paper III)

Source : TH

In India, a prevalent practice involves patients seeking a second opinion on prescriptions from the sales staff at medical shops, rather than consulting qualified pharmacists.

Queries range from medicine strength to potential side effects, with the understanding that responses are free as long as the prescribed medicines are purchased from the same shop.

Key Highlights

Over-the-Counter Sales Reality:
- Customers readily accept the advice from a medical shop, even if the prescription was written by a specialist.
- Interestingly, this trend contrasts with behavior at liquor shops or cigarette vendors, where health-related queries are seldom raised.
- Similarly, in supermarkets, customers overlook the potential health impact of insecticide-coated fruits and vegetables.
Generic Over Brand:
- The National Medical Council (NMC) in India directed doctors to prescribe generic names rather than brand names on August 3, 2023, leading to protests.
- The aversion to brand names is attributed to their higher cost, with generic alternatives being significantly cheaper.
- The Hathi Committee in 1975 advocated for the gradual elimination of brand names, challenging the perception that only renowned brands guarantee quality.
Pharmaceutical Industry Influence:
- There is an alleged nexus between pharmaceutical companies and doctors, involving unethical marketing strategies and promotional offers.
- Despite this, the Indian Medical Association and allied professional organizations emphasize their commitment to improving access to affordable medicines, considering it an ethical responsibility.
Quality Parameters and Concerns:
- The reputation of doctors relies on the reliability of the quantity and quality of active pharmaceutical ingredients in prescribed medications.
- However, questions arise about who ensures compliance with these quality parameters.
- The options include individual manufacturers, pharmaceutical industry networks, Indian standards and quality control, and price control authorities.
- Recent national drug surveys in India reveal a concerning prevalence rate of 4.5% for spurious medicines and 3.4% for “not standard quality” (NSQ) medicines.
- Maintaining 100% quality in drugs is deemed essential for patient safety and complete healing.
Government’s Role in Quality Assurance:
- The government must take a proactive role in ensuring the quality of medicines within both the Universal Health Coverage system and the private healthcare network.
- Regular sampling and testing of drug batches are crucial, with strict measures, including bans and punitive actions against manufacturers, for those failing quality tests.
- The Tamil Nadu Medical Services Corporation Limited’s practice of keeping supplied medicines under quarantine until they pass double-blinded quality tests is commendable in this regard.
- This approach ensures that only medicines with a pass quality test report enter the stock.
- Until the government can provide concrete evidence of the standard quality of all medicines in the market, doctors should be allowed to include the name of the company (in brackets) in their generic prescriptions, signifying their confidence in the medicine’s quality.
- Without this assurance, enforcing generic-only prescriptions may lead to reliance on profit-driven decisions by pharmacists or sales personnel.
Accessibility and Availability of Essential Medicines:
- The availability rate of essential medicines should be above 90%.
- A study in Chhattisgarh found that only 17% of essential pediatric medicines were available in 2010.
- There should also be an emphasis on the need to ban unscientific combinations of medicines, which currently constitute around 40% of the retail market in India.
Ensuring Affordable Medicines:
- While policies for free medicines and diagnostics under Universal Health Care are commendable, effective implementation and monitoring are crucial.
- The expansion of Janaushadhikendras and the establishment of profit margin norms for wholesale and retail agents are suggested to enhance accessibility to cheaper medicines.
Concerns about ‘Generic Prescribing’ Order:
- Following the Indian Medical Association’s protest, the National Medical Council (NMC) withdrew the order on ‘generic prescribing’ on August 23, 2023.
- The can be a setback in achieving the goal of universal access to affordable generic medicines without brand names, emphasizing the need for a balanced approach.

Understanding the Terminologies

Generic Medicines:
- Definition:
  - Generic medicines are pharmaceutical products that are equivalent to brand-name drugs in terms of quality, safety, and efficacy.
  - However, they are produced and marketed under their chemical name without the brand name.
- Key Characteristics:
  - Same Active Ingredient: Generic medicines contain the same active pharmaceutical ingredient as the brand-name drug.
  - Same Strength and Dosage Form: They have the same strength, dosage form, and route of administration as the original drug.
  - Bioequivalence: Generic drugs must demonstrate bioequivalence, meaning they should be absorbed in the body at the same rate and to the same extent as the brand-name drug.
- Active Pharmaceutical Ingredient (API):
  - The active pharmaceutical ingredient is the biologically active component of a drug.
  - It is the substance responsible for the therapeutic effects of the medication.
  - Role:
    - The API provides the pharmacological activity of the drug.
    - In a formulation, the API is combined with other substances, known as excipients, to create the final pharmaceutical product.
  - Brand-name Drug:
    - A brand-name drug is a medication that is developed, patented, and marketed by a pharmaceutical company.
    - It is given a unique brand or trade name.
    - Exclusive Rights:
      - The pharmaceutical company holds exclusive rights to manufacture and sell the drug for a certain period (typically through a patent).
      - This exclusivity allows the company to recoup the costs of drug development.
    - Excipients:
      - Excipients are inactive substances added to a pharmaceutical formulation alongside the active pharmaceutical ingredient.
      - They help in the manufacturing process, enhance stability, improve taste, or aid in drug delivery.
      - Examples:
        
        Excipients can include fillers, binders, preservatives, flavorings, and colorings.

On the sub-categorisation within castes

(General Studies- Paper II)

Source : TH

Prime Minister Narendra Modi, during an election rally in Telangana, pledged to explore the sub-categorization of Scheduled Castes (SCs) to identify and support the most backward among them.

The Madigas in Telangana have raised concerns that their share of representation within the SCs is being overshadowed by another SC community, the Malas.

Key Highlights

Legality of Sub-Categorization:
- The legality of sub-categorizing SCs has been a contentious issue, with multiple states, including Punjab, Bihar, and Tamil Nadu, attempting to introduce reservation laws at the state level for sub-categorization.
- These attempts have faced legal challenges, and the matter is pending in courts as the Supreme Court assembles a larger Constitution Bench to make a definitive decision on the issue.
Historical Context:
- Andhra Pradesh Commission (1996):
  - The issue first surfaced when the Andhra Pradesh government formed a one-man Commission led by Justice Ramachandra Raju in 1996, recommending sub-categorization based on evidence of varying backwardness and representation among SC communities.
- Supreme Court’s 2004 Ruling:
  - In 2004, the Supreme Court ruled that states lacked the unilateral power to sub-categorize communities within the lists of SCs or Scheduled Tribes (STs).
  - According to the Constitution, only Parliament can create these lists, notified by the President.
- Contradictory Rulings:
  - Punjab’s Attempt (2020):
    - In a 2020 judgment, a five-judge Bench, led by Justice Arun Mishra, held that determining the quantum of benefits in the existing lists of SCs/STs would not amount to interference and that states could proceed with sub-categorization.
  - However, this judgment contradicted the 2004 ruling, leading to the 2020 decision also being referred to the larger Bench for clarification.
- Current Status and Implications:
  - The legal status of sub-categorization remains uncertain as the matter awaits resolution by the larger Constitution Bench.
  - While the legality of SC sub-categorization is awaiting a Supreme Court decision, the 2004 judgment prompted the Union government to explore legal options.
  - In 2005, the Attorney-General of India (AGI) opined that sub-categorization was possible with unimpeachable evidence and suggested a constitutional amendment.
  - National Commission Formation:
    - Following the AGI’s opinion, the Union government established a National Commission to examine sub-categorization in Andhra Pradesh.
    - The Cabinet recommended amending Article 341 of the Indian Constitution.
    - However, the National Commission for Scheduled Castes (NCSC) and the National Commission for Scheduled Tribes (NCST) argued against the necessity of a constitutional amendment.
  - Arguments for Sub-Categorization:
    - Graded Inequalities:
      - The primary argument supporting sub-categorization is the existence of graded inequalities among SC communities.
      - The contention is that some communities within the marginalized SCs face greater obstacles in accessing basic facilities, leading to more forward communities consistently benefiting while marginalizing the more backward ones.
    - Arguments Against Sub-Categorization:
      - The SC and ST Commissions argue that separate reservations within categories wouldn’t address the root cause.
      - An internal note by the NCST emphasizes that the most backward SCs lag significantly behind forward SC communities.
      - Creating a separate quota may not help, as even if higher-level posts are reserved, these most backward SCs may lack candidates due to existing disparities.
      - Both the NCSC and the NCST recommend prioritizing the delivery of existing schemes and government benefits to the most backward sections before considering sub-categorization.
      - This approach aims to ensure equal representation at all levels.
    - Challenges and Expert Views:
      - Legal experts highlight the necessity for concrete population numbers and socio-economic data of each community and sub-community to support sub-categorization.
      - Senior Advocate Mohan Gopal emphasizes the importance of reliable data to make informed decisions on how castes can be categorized and the appropriate percentage of reservation.

World’s First Chikungunya Vaccine by Valneva

(General Studies- Paper III)

Source : TH

The U.S. health authorities have granted approval for the world’s first vaccine for chikungunya, a mosquito-borne virus that the Food and Drug Administration (FDA) considers “an emerging global health threat.”

The vaccine, named Ixchiq and developed by Europe’s Valneva, is intended for individuals aged 18 and over who are at an increased risk of exposure.

Key Highlights

Details of the Approval:
- The FDA’s approval is expected to facilitate the rapid deployment of the vaccine, especially in regions where chikungunya is prevalent.
- Valneva will market the vaccine under the name Ixchiq.
- The approval addresses an unmet medical need and represents a crucial advancement in preventing a potentially debilitating disease for which treatment options are limited.
- Currently, there is no specific drug to treat chikungunya; only medications for pain and fever relief are available.
Ixchiq Vaccine Details:
- The vaccine is administered in one dose and contains a live, weakened version of the chikungunya virus, following the standard approach for vaccines.
- Two clinical trials involving 3,500 people were conducted in North America.
- Side Effects:
  - Commonly reported side effects include headache, fatigue, muscle and joint pain, fever, and nausea.
- Serious Reactions:
  - Serious reactions were reported in 1.6% of Ixchiq recipients, with two requiring hospitalization.
- Chikungunya-Like Reactions:
  - Some vaccine recipients experienced chikungunya-like adverse reactions lasting 30 days or more.
- Concerns and Future Steps:
  - The FDA raises concerns about whether the vaccine virus can be transmitted from a pregnant person to their unborn child and whether it can cause adverse effects in newborns.
  - Chikungunya’s potential as a future pandemic threat is noted, particularly with climate change influencing the spread of mosquitoes that carry the virus into new regions.
- Valneva has filed an application for authorization with the European Medicines Agency (EMA).

About Chikungunya

Origin and Discovery:
- Chikungunya is a viral disease that was first identified during an outbreak in southern Tanzania in 1952.
- The name “chikungunya” is derived from the Kimakonde language, meaning “to become contorted” or “to walk bent over,” reflecting the stooped appearance of those suffering from joint pain, a common symptom of the disease.
Causative Agent:
- The Chikungunya virus (CHIKV) is responsible for the disease.
- It belongs to the Alphavirus genus and is primarily transmitted to humans through the bite of infected Aedes mosquitoes, primarily Aedesaegypti and Aedesalbopictus.
Global Prevalence:
- Chikungunya is found in Africa, Asia, Europe, and the Americas.
- The virus has caused periodic outbreaks in various regions, with the most significant impact occurring in tropical and subtropical areas.
Symptoms:
- Chikungunya infection typically manifests with an abrupt onset of fever and severe joint pain, which is often debilitating.
- Other common symptoms include muscle pain, headache, nausea, fatigue, and rash.
- The joint pain associated with chikungunya is usually bilateral and symmetric and can be severe and prolonged.
Transmission:
- The primary mode of transmission is through the bite of infected mosquitoes.
- In rare cases, the virus can also be transmitted from mother to newborn around the time of birth, through blood transfusion, and in laboratory settings where there is accidental exposure.

Treatment:
- There is no specific antiviral treatment for chikungunya.
- Treatment is generally supportive and focuses on relieving symptoms, such as reducing fever and alleviating joint pain.
- Rest, hydration, and pain relievers like acetaminophen are commonly recommended.
Prevention and Control:
- Prevention involves avoiding mosquito bites through the use of insect repellents, wearing long sleeves and pants, and using bed nets.
- Efforts to control mosquito populations and reduce breeding sites are also crucial in preventing the spread of the disease.
Impact:
- While chikungunya is not usually fatal, the joint pain can be severe and debilitating, affecting quality of life.
- Outbreaks can have significant social and economic impacts in affected areas, particularly in terms of healthcare costs and lost productivity.

RBI increases risk weights on consumer credit exposure of banks, NBFCs

(General Studies- Paper III)

Source : TH

The RBI, a day after restricting Bajaj Finance Ltd. from disbursing loans under ‘eCOM’ and ‘Insta EMI Card,’ issued regulatory measures addressing concerns about the increasing unsecured loan books of certain Regulated Entities (REs).

Key Highlights

RBI’s Regulatory Measures: Increased Risk Weights
- The RBI referred to the Governor’s statement on October 6, 2023, highlighting the rapid growth in specific consumer credit components.
- It advised banks and NBFCs to enhance internal surveillance, address risks, and establish safeguards.
- Consumer credit exposure (excluding housing, education, vehicle, and gold-secured loans) for commercial banks will see a 25 percentage point increase in risk weights, from 100% to 125%.
- Consumer credit exposure of NBFCs categorized as retail loans (excluding specified loans) will have risk weights increased from 100% to 125%.
- Risk weights on credit card receivables will be raised by 25 percentage points to 150% for scheduled commercial banks (SCBs) and 125% for NBFCs.
- Risk weights on SCBs’ exposures to NBFCs will increase by 25 percentage points for cases where the risk weight based on external rating is below 100%.
Review of Sectoral Exposure Limits:
- REs are instructed to review sectoral exposure limits for consumer credit, establishing board-approved limits for sub-segments.
- Strict adherence and ongoing monitoring of limits, particularly for unsecured consumer credit exposures, are emphasized.
- Top-up loans against depreciating movable assets (e.g., vehicles) will be treated as unsecured loans for credit appraisal and exposure purposes.
Implementation Timeline:
- The regulatory measures are effective immediately, except for strengthening credit standards for board-approved limits, which must be implemented no later than February 29, 2024.
The move is anticipated to lead to higher capital requirements for lenders, leading to increased lending rates and potential spillover effects on corporate bonds.

What does the RBI’s step mean?

Risk Weight Definition:
- Risk weight is a measure used in banking regulations to determine the capital that banks need to set aside as a cushion against potential losses arising from various types of assets.
- The higher the risk weight assigned to a particular category of assets, the more capital a bank is required to hold against those assets
Consumer Credit Exposure:
- Consumer credit exposure involves loans and financial products provided by banks to individual consumers.
- This can include personal loans, credit card loans, and other unsecured forms of credit.
Impact on Capital Requirements:
- The increase in risk weights reflects regulatory concerns about the perceived riskiness of consumer credit.
- By raising the risk weight to 125%, regulators are signaling that they consider consumer credit to be a slightly riskier category.
- For commercial banks, this means they will have to allocate more capital to cover the increased risk associated with their consumer credit portfolios.
Potential Effects on Lending and Interest Rates:
- Higher capital requirements can influence a bank’s lending decisions.
- To meet increased capital requirements, banks might adjust their lending practices.
- This could potentially result in changes to interest rates on consumer loans, as banks may pass on the higher capital costs to borrowers.