CURRENT AFFAIRS – 20/12/2023

CURRENT AFFAIRS – 20/12/2023

Centre launches forest certification scheme

(General Studies- Paper II)

Source : The Indian Express

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Amid global concerns about deforestation and illicit timber trade, the Indian government has introduced its own forest certification scheme called the Indian Forest and Wood Certification Scheme (IFWCS).

• The scheme aims to validate entities adhering to sustainable forest management practices, providing an alternative to foreign certification agencies operating in India for the past two decades.

Key Highlights

• The IFWCS launch is accompanied by the introduction of new standards for forest management, which will be mandatory for all forest divisions in the country.
• The Indian Forest Management Standards include eight criteria, 69 indicators, and 254 verifiers.
• Certification Eligibility:
  • While adherence to the standards is mandatory for forest divisions, obtaining the IFWCS certification is not obligatory.
  • Entities become eligible for certification if they adhere to the standards, and certification will be based on their specific needs.
  • The IFWCS is a government-backed initiative aimed at bringing trust, transparency, and acceptability to Indian forest-based products in international markets.
• Scope of Certification:
  • The IFWCS provides certification for sustainable forest management, management of trees outside forests (e.g., plantations), and chain of custody, ensuring traceability of forest products throughout the supply chain.
  • The certification is relevant for various stakeholders, including forest management units, corporations, wood-based industries, tree growers, traders, saw millers, exporters, importers, and end-user industries.
• International Market Significance:
  • Given that Europe and the United States are major export markets for India’s forest-based products, especially handicrafts and furniture, the IFWCS aims to address tightening rules for the import of such products.
  • The global commitment at the Glasgow climate change conference in 2021, with over 100 countries pledging to halt and reverse deforestation by 2030, underscores the international significance of sustainable forest management initiatives like IFWCS.
• While currently a government-backed scheme, experts anticipate that the IFWCS may evolve into an independent entity, similar to the Bureau of Indian Standards or Quality Council of India, enhancing its credibility and longevity.

More about Indian Forest & Wood Certification Scheme

• The Ministry of Environment, Forests and Climate Change has introduced IFWCS, a national forest certification initiative aimed at promoting sustainable forest management and agroforestry practices in India.
• The IFWCS offers voluntary third-party certification encompassing three key components-
  • forest management certification,
  • tree outside forest management certification, and
  • chain of custody certification.
• Target Entities:
  • The scheme extends market incentives to various entities engaged in responsible forest management and agroforestry practices.
  • This includes state forest departments, individual farmers, Farmer Producer Organizations involved in agroforestry and farm forestry, as well as wood-based industries within the value chain.
• Forest Management Certification:
  • Based on the Indian Forest Management Standard, the Forest Management certification includes 8 criteria, 69 indicators, and 254 verifiers.
  • This standard is an integral part of the National Working Plan Code 2023.
• Also introduced as part of IFWCS, the Trees Outside Forests Standard focuses on promoting sustainable practices related to trees outside traditional forest areas.
• Oversight and Advisory Body:
  • The Indian Forest and Wood Certification Council will oversee the IFWCS and serve as a multistakeholder advisory body.
  • Members include representatives from institutions like the Indian Council of Forestry Research and Education, Forest Survey of India, Quality Council of India, Indian Institute of Forest Management, Ministries of Agriculture and Farmers’ Welfare, Ministry of Commerce and Industry, State Forest Departments, Forest Development Corporations, and wood-based industries.
  • Operating Agency:
    • The Indian Institute of Forest Management, Bhopal, will function as the scheme’s operating agency, responsible for overall management and implementation of IFWCS.
  • Accreditation Process:
    • The National Accreditation Board for Certification Bodies under the Quality Council of India will accredit certification bodies.
    • These bodies will conduct independent audits to assess adherence to the standards outlined in the IFWCS.
  • The IFWCS adopts a holistic approach by involving various stakeholders, ensuring representation from government bodies, research institutions, and industry players.
  • This collaborative effort aims to enhance the credibility and effectiveness of the certification scheme in promoting sustainable practices across the forestry and wood-based industries in India.

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Plug the breach

(General Studies- Paper III)

Source : The Indian Express

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The Delhi Police has arrested four individuals about two months after intelligence agencies reported a significant security breach in which personal details of over 80 crore people were leaked from the website of the Indian Council of Medical Research (ICMR) and offered for sale on the dark web.

• The breach, initially flagged by a US agency, poses challenges for law enforcement agencies and policymakers, particularly in the context of the government’s emphasis on healthcare digitization.

Key Highights

• Nature of Data Leak:
  • The severity of the data leak is attributed not only to its volume but also to the sensitive nature of the information disclosed, including Aadhaar and phone numbers, passport details, and health records.
  • These details are considered keys that can potentially unlock information related to financial transactions, personal communications, and medical histories, raising concerns about privacy violations.
• Lessons for Cybersecurity and Digital Health Infrastructure:
  • The investigation into the ICMR data breach is seen as an opportunity to extract valuable cybersecurity lessons.
  • With the government’s focus on healthcare digitization, there is a crucial need for authorities to stay ahead of cyber infiltrators.
  • The incident highlights the importance of digital systems in healthcare, as demonstrated during the Covid vaccination drive.
  • Digital repositories of patient information can lead to quicker diagnoses, better treatment decisions, and improved safety standards.
  • Initiatives like the Ayushman Bharat Digital Mission are central to advancing digital healthcare, operating on a federated architecture to enhance information flow between participants.
  • While acknowledging the benefits of digital healthcare, it is equally important to put in place a robust data security measure.
  • A World Bank study of the Ayushman Bharat Digital Mission emphasizes the need for effective security measures, especially as health insurers can access patient data within the ecosystem.
  • Also, a previous ransomware attack on AIIMS servers that disrupted operations for nearly two weeks, underscoring the potential consequences of cyber attacks on medical systems.
• The question remains whether compromised information from the ICMR breach found its way to the dark web.
• Global Context:
  • The ICMR incident is not unique, as other countries, including the UK’s NHS, have faced health data security issues.
  • The UK’s Data Protection Act and the US’s Health Insurance Portability and Accountability Act aim to secure health-related data but are acknowledged as part of an ongoing process to enhance system security.
• It is suggested that the ICMR breach should prompt policymakers to reassess and strengthen existing systems, especially in light of the recently introduced Data Protection Act in India, which has faced criticism for perceived insensitivity to the security demands of health-related information.

About Indian Council of Medical Research (ICMR)

• The Indian Council of Medical Research (ICMR) is a premier scientific organization in India dedicated to biomedical research.
• Established in 1911, it operates under the Department of Health Research, Ministry of Health and Family Welfare, Government of India.
• The primary objective of the ICMR is to promote and conduct research in various areas of medicine and public health to address the health challenges faced by the country.
• Key Functions:
  • Biomedical Research
  • Disease Surveillance and Control
  • Clinical Trials
  • Health Systems Research
  • Public Health Programs
  • Capacity Building

What is Dark Web?

• The Dark Web is a part of the World Wide Web that is intentionally hidden and accessible only through specific software, configurations, or authorization.
• It is a subset of the deep web, which includes all parts of the internet not indexed by traditional search engines.
• The Dark Web is characterized by its anonymity, and it is often associated with illicit activities.
• Key aspects of the Dark Web:
  • Traditional search engines like Google, Bing, and Yahoo do not index Dark Web websites.
  • Users on the Dark Web often operate with a high degree of anonymity.
    • This is achieved through the use of specialized software like Tor (The Onion Router), I2P (Invisible Internet Project), or Freenet, which anonymize users’ internet traffic by routing it through a series of servers.
  • While the Dark Web is not inherently illegal, it has gained notoriety for hosting various illicit activities, including the sale of illegal drugs, hacking tools, stolen data, counterfeit currency, and more.
  • Despite its association with illegal activities, the Dark Web also serves as a platform for whistleblowers and privacy advocates.
    • Platforms like WikiLeaks have used the Dark Web to provide a secure and anonymous channel for individuals to submit sensitive information.
  • Accessing the Dark Web involves certain risks, and individuals are advised to exercise caution.
    • Browsing the Dark Web can expose users to malicious content, scams, and potential legal consequences.

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How MPs are suspended?

(General Studies- Paper II)

Source : The Indian Express

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Thirty-three Lok Sabha members and 45 Rajya Sabha members, all belonging to the Opposition INDIA group, were suspended for disrupting Parliamentary proceedings, primarily in response to last week’s security breach.

Key Highlights

• The MPs were suspended due to disruptions related to the security breach incident in Parliament last week.
• Reasons for Parliamentary Disruptions:
  • Parliamentary disruptions have historical roots and are often driven by various factors.
  • Chakshu Roy, head of outreach at PRS Legislative Research, identified four broad reasons for disorder in legislatures:
    • Lack of time for MPs to address important matters.
    • Unresponsive attitude of the government and retaliatory posture by the Treasury benches.
    • Deliberate disruption by parties for political or publicity purposes.
    • Absence of prompt action against MPs disrupting proceedings.
  • Tradition of Disruptions:
    • Disruptions inside Parliament have been a longstanding tradition, irrespective of the political party or alliance in opposition.
    • The reasons for disruptions often relate to issues of time allocation, government responsiveness, political motives, and the lack of immediate consequences for disruptive behaviour.
    • All political parties, regardless of their current position, have engaged in disrupting Parliament.
    • Views on disruptions are often influenced by whether a party is in power or in the opposition.
  • Reduced Opposition Influence:
    • Over the years, the Opposition’s influence in determining the Parliamentary calendar has diminished.
    • The government sets the agenda, decides the time allocated to specific issues, and prioritizes its own business.
    • The rules governing Parliamentary proceedings have not been updated for several decades, contributing to an ongoing cycle of disruptions.
  • Authority to Suspend MPs:
    • The power to suspend Members of Parliament (MPs) lies with the Presiding Officers, namely the Speaker of the Lok Sabha and the Chairman of the Rajya Sabha.
    • The rules governing suspensions are outlined in Rules 373, 374, and 374A for Lok Sabha and Rules 255 and 256 for Rajya Sabha.
  • Suspension Process:
    • The process typically involves the following steps:
      • The Presiding Officer directs an MP to withdraw from the House for disorderly conduct.
      • If the MP continues to disrupt proceedings, the Presiding Officer can officially “name” the legislator.
      • The House can then move a motion to suspend the named MP until the end of the session.
    • Lok Sabha Rule 374A (2001 Amendment):
      • In 2001, the Lok Sabha introduced Rule 374A, empowering the Speaker to deal with “grave and disorderly conduct.”
      • Under this rule, an MP named by the Speaker automatically stands suspended for five days or the remaining part of the session, eliminating the need for a separate motion for suspension.
    • Rajya Sabha Procedures:
      • The Rajya Sabha has not incorporated the Lok Sabha’s Rule 374A.
      • In the Rajya Sabha, after an MP is named by the Chair, a motion is typically moved to suspend the MPs, and the suspension is adopted by a voice vote.
    • Duration of Suspension:
      • MPs can be suspended for the remainder of the session as a maximum penalty.
      • The House has the authority to reinstate a suspended member at any point by passing a motion.
    • Punishments for Disorderly Conduct:
      • Mild offenses are usually addressed with admonition or reprimand, with reprimand being the more severe punishment.
      • The next level of punishment is the withdrawal, where an MP is directed to leave the House for the remainder of the day’s sitting.
      • Extreme Misconduct:
        • In cases of extreme misconduct, the House may resort to expulsion as a means to rid the House of members deemed unfit for membership.
      • Unchanged Rules Since 1952:
        • The rules related to the suspension of MPs have largely remained unchanged since 1952, with occasional amendments to empower the Presiding Officer, as seen in the Lok Sabha’s Rule 374A.
      • Parliamentarian Suspensions – Trends and Debates
        • While the suspension of Members of Parliament (MPs) is a robust measure, it is not uncommon.
        • In recent years, there has been an increase in the number of suspensions.
        • Since 2019, at least 149 suspensions have been recorded in both Houses combined, compared to 81 in the period 2014-19 and 36 in 2009-14.
        • The issue of suspending MPs has been the subject of ongoing debate, with Presiding Officers seeking ways to address the challenge.
        • The rationale behind such suspensions is often linked to disorders in the House arising from frustration, lack of opportunities for expression, or planned parliamentary offenses for publicity or political motives.
      • Presiding Officer’s Role:
        • The Presiding Officer, whether the Speaker in the Lok Sabha or the Chairman in the Rajya Sabha, plays a crucial role in maintaining balance in the House.
        • There is recognition that disorders may stem from frustration, and dealing with them is relatively easier.
        • However, planned parliamentary offenses and deliberate disruptions present a more challenging scenario.
      • Balance and Democratic Values:
        • Maintaining a balance in the House is crucial for the Presiding Officer.
        • While the enforcement of the Speaker’s authority is essential for smooth proceedings, it is equally important to uphold democratic values and avoid an authoritarian approach.
        • The solution to the issue is viewed as needing to be long-term and consistent with the evolving democratic landscape of India.

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Tax ‘HFSS’ foods, view it as a public health imperative

(General Studies- Paper II)

Source : TH

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The consumption of High Fat Sugar Salt (HFSS) foods poses a significant global health risk, leading to issues such as obesity, diabetes, and high blood pressure.

• Contrary to the perception that overweight and obesity are mainly problems in high-income countries, a 2019 World Bank report reveals that 70% of overweight and obese individuals reside in Low- and Middle-Income Countries, with a 55% increase in rural areas worldwide.

Key Highlights

• In India, the burden of Non-Communicable Diseases (NCDs) has skyrocketed from 38% in 1990 to 65% in 2019.
• The Global Burden of Diseases study indicates that dietary risks alone contribute to 1.2 million deaths annually in India.
• The economic impact of overweight and obesity in the country was estimated at $23 billion in 2017, with a projected rise to $480 billion by 2060 if unaddressed.
• India’s Shift in Dietary Habits:
  • The ultra-processed food sector in India has experienced a compounded annual growth rate of 13.4% between 2011 and 2021.
  • As the world’s largest producer and consumer of sugar, India has witnessed a concerning surge in HFSS food consumption.
  • Approximately 50%-60% of edible sugar, salt, and fat produced in the country are consumed by the processed food industry.
  • Sales of snacks and soft drinks have tripled over the past decade, exceeding $30 billion, reflecting an alarming trend in dietary habits.
• Global Response: Leveraging Fiscal Measures:
  • Recognizing the need for intervention, there is a global trend of utilizing fiscal measures, particularly taxation, to combat obesity.
  • While taxation on sugar-sweetened beverages (SSBs) is widespread and implemented in over 60 countries, taxation on HFSS food is less common but rapidly increasing.
  • Sixteen countries, including Denmark, France, Hungary, Mexico, South Africa, the United Kingdom, and the United States, have dedicated taxes on HFSS foods.
  • Colombia’s “junk food law” serves as a recent model, introducing a progressively increasing levy on ultra-processed foods.
• India’s Attempt and the Way Forward:
  • India has experimented with fiscal measures, with Kerala introducing a ‘fat tax’ in 2016, later subsumed into the Goods and Services Tax in 2017.
  • Urgent interventions are necessary to curb the rising consumption of HFSS products in India, considering the severe health risks, impact on productivity, and the looming economic burden.
  • The global success of taxation as a tool against obesity underscores the potential effectiveness of such measures in shaping healthier dietary habits worldwide, emphasizing the need for comprehensive strategies to address this growing global health challenge.
• The Case for High HFSS Tax:
  • The argument for imposing a high tax on High Fat Sugar Salt (HFSS) foods stems from significant market failures associated with their consumption.
  • The negative externalities, manifested as societal costs in increased healthcare expenditures, are a direct result of escalating diabetes and obesity linked to HFSS consumption.
  • These external costs are borne by society, necessitating higher taxes to fund public health insurance programs like Ayushman Bharat Yojana.
  • On the other side, internalities, arising from consumers’ limited understanding influenced by aggressive marketing, result in inadvertent harm to themselves.
  • Taxation provides a targeted and effective means to curb detrimental consumption habits, reducing societal burdens.
  • Unlike taxes on tobacco and alcohol, HFSS taxation is not primarily a revenue-raising tool.
  • Instead, it serves as a fiscal tool to incentivize the industry to reformulate products in favour of healthier alternatives and encourages individuals to adopt a healthier diet.
• Non-Regressive and Fiscally Neutral Approach:
  • A well-designed HFSS food tax can be both non-regressive and fiscally neutral.
  • Studies, such as the one on South Africa’s Health Promotion Levy, demonstrate larger relative reductions in purchases among lower socio-economic status households, making such taxes non-regressive.
  • Differentiated tax rates based on nutritional quality incentivize product reformulations, creating a level-playing field between HFSS and healthier alternatives.
• GST and Nutritional Content:
  • Current Goods and Services Tax (GST) rates on ultra-processed foods in India do not align adequately with nutritional content.
  • Uniform taxation on items like salty snacks, sugar-sweetened beverages (SSBs), and juices overlooks their varying nutritional impact, hindering efforts to alter consumption patterns in favour of healthier alternatives.
  • The call for tax differentiation based on nutritional quality aims to make healthier food choices more affordable and accessible.
• HFSS Tax as a Public Health Imperative:
  • The HFSS taxation in India is not solely an economic or fiscal policy concern but should be considered a public health imperative.
  • Effectively designed taxes can act as deterrents, promote healthier choices, prompt industry reformulation, improve public health outcomes, reduce the burden on the healthcare system, and contribute to the nation’s well-being.
  • When combined with other measures like promoting nutrition literacy and effective food labelling, HFSS taxation becomes a potent tool in combating the rising epidemic of overweight and obesity, fostering a more sustainable and equitable food system.

What is High Fat Sugar Salt (HFSS) foods?

• High Fat Sugar Salt (HFSS) foods refer to a category of food products that are characterized by their high content of unhealthy ingredients, namely fat, sugar, and salt.
• These foods are often processed and manufactured to be palatable and highly appealing to consumers, but their nutritional profile is a cause for concern due to the excessive levels of these three components.
• Consuming HFSS foods regularly is associated with various health risks, including obesity, type 2 diabetes, cardiovascular diseases, and hypertension.

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India’s ethanol conundrum

(General Studies- Paper III)

Source : TH

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As over 100 countries pledge to triple global renewable energy capacity at COP28 in Dubai, India grapples with challenges to its ethanol blending target.

• Despite the increase in ethanol blended petrol (EBP) from 1.6% in 2013-14 to 11.8% in 2022-23, the 20% target by 2025 faces obstacles due to low sugar stocks and an impending sugarcane production shortfall.
• The government considers a shift towards grains-based ethanol, with a focus on maize, as indicated by the authorization of procurement by NAFED and NCCF.

Key Highlights

• Crucial Feedstock and Food-Fuel Conflict:
  • Ethanol production relies on major feedstocks such as sugarcane and corn, with Brazil and the U.S. being prominent producers.
  • The use of corn for ethanol production raises concerns about the food-fuel conflict, as it directly competes with its use as food or livestock feed.
  • Unlike sugarcane, where ethanol is produced from molasses with minimal trade-off with sugar output, corn-based ethanol diverts grain from food and creates a direct link between food and crude oil prices.
• Historical Context:
  • The boom in ethanol production in Brazil and the U.S. from 2000 was driven by rising crude oil prices, establishing a strong link between crude and food prices.
  • The high prices of corn, a key feedstock, were transmitted to other grain markets, contributing to the global food crisis of 2006-14.
  • The era of agro fuels re-emphasizes the correlation between crude and food prices, with post-pandemic oil price recovery pushing up food prices.
• Challenges and Considerations:
  • While sugarcane is a more obvious choice for tropical countries like India, concerns about environmental impact and food production displacement require careful regulation through land-use policies.
  • More land under water-intensive sugarcane cultivation can displace food production as well as degrade water tables, but these can be regulated by appropriate policies.
• Differential Pricing Impact:
  • India’s ethanol strategy faced challenges with the introduction of differential pricing in 2017-18, incentivizing the direct use of cane juice for ethanol production.
  • While this approach accelerated progress toward the 2025 Ethanol Blended Petrol (EBP) target, it intensified the food versus fuel debate.
  • Mills shifted away from the more sustainable molasses route, leading to reduced sugar stocks.
• Corrective Steps and New Challenges:
  • The Ministry of Consumer Affairs’ December 7, 2023 order banning the use of cane juice for ethanol production is a corrective step to address challenges.
  • However, the transition to grains-based ethanol, particularly maize, to achieve the 2025 target raises concerns about uncontrollable food inflation.
  • The government’s estimated need for 16.5 million tonnes of grains annually for ethanol production could trigger a short-run price spiral in grain markets.
  • India’s renewables strategy faces a delicate trade-off between meeting energy targets and potential consequences for food production and prices.
  • The government must navigate this balance carefully, considering the impact on hunger and the goal of reducing fossil fuel use.
• Two potential approaches are suggested in this regard:
  • reconsidering the EBP target and staggering it to mitigate contradictions or increasing investment in public infrastructure, urban design, and renewable energy sources like solar power to address fuel demand for automobiles.
• The future of India’s renewables strategy hinges on critical choices between intensifying hunger and reducing fossil fuel use.
• Balancing the food-fuel trade-off requires thoughtful reconsideration of targets and increased investment in sustainable alternatives.

What is Ethanol?

• Ethanol, also known as ethyl alcohol, is a renewable biofuel produced through the fermentation of sugars.
• It is commonly derived from plant materials such as sugarcane, corn, wheat, or cellulose-rich biomass.
• Ethanol is widely used as a fuel additive, particularly in gasoline, to reduce emissions and enhance octane levels.
• Additionally, it serves as a key ingredient in alcoholic beverages.
• Generations of Ethanol Production:
  • First Generation (1G) Ethanol:
    • Feedstock: First-generation ethanol is produced from food crops such as sugarcane, corn, and wheat.
    • Process: The primary method is fermentation, where sugars from the crop are converted into ethanol by yeast.
    • Advantages: Established technology, high ethanol yield.
    • Challenges: Competition with food production, potential for land-use conflicts, and concerns about food security.
  • Second Generation (2G) Ethanol:
    • Feedstock: Second-generation ethanol utilizes non-food crops or lignocellulosic biomass, including agricultural residues (corn stover, wheat straw), forestry residues, and energy crops (miscanthus, switchgrass).
    • Process: Involves breaking down cellulose and hemicellulose in biomass into sugars through enzymatic hydrolysis, followed by fermentation.
    • Advantages: Addresses concerns related to food competition, utilizes waste or non-food biomass.
    • Challenges: Technologically complex and costlier compared to 1G ethanol, as breaking down cellulose is more challenging.
  • Third Generation (3G) Ethanol:
    • Feedstock: Third-generation ethanol explores advanced biofuel sources, including algae and other microorganisms.
    • Process: Algae, through photosynthesis, produce lipids or carbohydrates, which can be converted into ethanol.
    • Advantages: Potential for high productivity and reduced competition for arable land.
    • Challenges: Technological and economic challenges in large-scale cultivation and extraction of fuel from algae.

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States can borrow an extra ₹2 lakh crore this year

(General Studies- Paper III)

Source : TH

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The Finance Ministry has indicated that states in India may access an additional borrowing limit of approximately ₹2.04 lakh crore beyond their net borrowing limits for the year.

• This move follows the Centre’s approval for 22 states to raise nearly ₹61,000 crore in additional borrowings this year, exceeding their net borrowing ceilings set at 3% of Gross State Domestic Product (GSDP) as of October 27.

Key Highlights

• Special Allowances and Criteria:
  • States that met their pension liabilities, contributing to the National Pension System (NPS), were granted the extra borrowing ceiling.
  • In addition, states are eligible to raise over ₹1.43 lakh crore based on Ministry of Power recommendations, tied to the Fifteenth Finance Commission’s suggestion of an additional borrowing space of 0.5% of GSDP as a performance-based incentive for power sector reforms enhancing operational and economic efficiency.
  • While the standard net borrowing ceiling for states stands at ₹8, 59,988 crore for the current year in accordance with the Fifteenth Finance Commission’s recommendations, approvals have been issued for open market borrowings, allowing states to raise ₹6.99 lakh crore.
  • Negotiated loans totaling ₹69,371 crore have also been sanctioned, as per the Finance Ministry’s statement.

About the borrowing limit of Indian states

• The borrowing limit of Indian states is determined based on the recommendations of the Fifteenth Finance Commission (FFC).
• The central government, responding to the COVID-19 situation, had increased the borrowing limits for states during the current fiscal year.
• The new limit allows states to borrow up to 5% of their Gross State Domestic Product (GSDP), up from the previous 3%.
• This move provides states with a fiscal headroom of ₹4.28 trillion, contingent upon their implementation of specific reforms.
• Conditions for Additional Borrowing:
  • Finance Minister Nirmala Sitharaman announced that part of the increased borrowing limits would be linked to prescribed reforms.
  • These reforms, outlined in conjunction with recommendations from the 15th Finance Commission, include measures to ensure the sustainability of additional debt through higher future GSDP growth and lower deficits.
  • The reforms also encompass initiatives such as promoting the welfare of migrants, reducing leakage in food distribution, increasing job creation through investment, safeguarding farmers’ interests, making the power sector sustainable, and promoting urban development, health, and sanitation.
• Structured Approach to Reforms:
  • The 200 basis points increase in borrowing limits follows a structured approach.
  • The first 50 basis points are unconditional.
  • The subsequent 100 basis points are divided into four tranches of 25 basis points each, linked to specific, measurable, and feasible reform actions.
  • These actions include universalization of the “one nation one ration card” system, improvements in ease of doing business, reforms in power distribution, and enhancement of urban local body revenues.
  • The final 50 basis points of the increased borrowing limit will be allowed if states achieve milestones in at least three out of the four specified reform areas.
  • This approach aims to incentivize and monitor states’ progress in undertaking critical reforms to address the economic challenges posed by the pandemic.

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