CURRENT AFFAIRS – 24/05/2023
India-Australia ties built on trust: Modi
Prime Minister Narendra Modi on Tuesday said the foundation of India-Australia relations lies in mutual trust and respect, as he along with his Australian counterpart Anthony Albanese addressed the Indian diaspora at a mega event here.
During the event, a suburb in Australia — Harris Park — was renamed “Little India”, reflecting the strong bond between the two strategic partners.
Mr. Modi also announced that India would open a consulate in Brisbane to fulfil a long-pending demand by the diaspora. The Prime Minister was given a rousing welcome by thousands of Indians who thronged the Qudos Bank Arena.
Mr. Albanese described India as a “force of global good” and a “bright spot” in the world economy.
India-Australia ties built on trust: Modi
“Today India is being called a force of global good. Wherever there is a disaster, India stands ready to help. Recently, when the earthquake caused devastation in Turkey, India extended a helping hand through ‘Operation Dost’,” Mr. Modi said.
Asserting that the strategic partnership between India and Australia is constantly deepening, Mr. Modi said, “We hope the bilateral trade between the two sides will more than double in the next five years”. The two countries signed the Economic Cooperation and Trade Agreement last year. “We are building resilient and reliable supply chains. This will provide momentum to the business of both sides,” he said.
There is a geographical distance between India and Australia, but the Indian Ocean connects us, Mr. Modi said and added that no matter how different the two countries are, they are connected at various levels. “Yoga connects us. Cricket is something which has kept us connected for ages…,” he said amid loud cheering from the crowd.
The Prime Minister also said the two countries have moved forward in recognising degrees issued by each other and this will benefit students of both sides.
Mr. Modi thanked his Australian counterpart for renaming Harris Park ‘Little India’. Harris Park is a hub in Western Sydney where the Indian community celebrates festivals and events such as Deepavali and Australia Day.
Addressing the gathering earlier, Mr. Albanese said Mr. Modi gets a “rock star reception” wherever he goes. “The last time I saw someone on this stage was [American singer] Bruce Springsteen and he did not get the welcome that Prime Minister Modi has got. Prime Minister Modi is the boss,” Mr. Albanese said. Springsteen was nicknamed ‘boss’ by his fans.
Australia is the 17th largest trading partner of India and India is Australia’s 9th largest trading partner.
Bilateral trade between India and Australia was US$ 27.5 billion in 2021, there is potential for it to reach around US$ 50 billion in five years.
Bilateral trade (in 2022): over $31 billion (India’s exports: over $10 billion and imports at $17 billion)
Both countries aim to boost bilateral trade to $100 billion by 2030
Both have an Agreement- Implementation of the Economic Cooperation and Trade Agreement (ECTA) (2022) and early completion of the Comprehensive Economic Cooperation Agreement (CECA)
“Malabar” exercises in August 2023 (India, Australia, Japan, and the US), India has been invited to join the Talisman Sabre exercises in 2023
A joint Naval exercise called AUSINDEX is carried out between India and Australia every year.
AUSTRA HIND is a bilateral military exercise between armies
Mutual Logistics Support Agreement (MLSA) (signed between both countries in 2022) to enhance military interoperability
Both are members of the Quad, Commonwealth, Indian Ocean Rim Association (IORA)
Australia signed a Uranium supply deal with India (2014)
Letter of Intent on New and Renewable Energy for cooperation to reduce the cost of renewable energy technologies.
India has given 10 million Australian dollars to Pacific Island Countries under the International Solar Alliance (ISA).
MoU between ISRO and Australian Space Agency (ASA) (2020) for space cooperation.
Shared vision: Free, open, and inclusive Indo-Pacific region, based on respect for sovereignty, territorial integrity, and international law.
The paradox of BRICS, its new pathway
is Distinguished Fellow, Gateway House and a former Ambassador
Mysterious are the ways in which multilateral groupings prosper and wither away. The Non-Aligned Movement (NAM) and G-77 had their heyday in the Cold War era. Later they lost their relevance, but they still exist. The South Asian Association for Regional Cooperation (SAARC) summits ended in 2014, but the Secretariat somehow keeps itself busy. Despite serious policy divergences on China and Myanmar, the Association of Southeast Asian Nations (ASEAN) continues to function, consuming reams of paper to issue long communiqués.
The case of BRICS is truly remarkable. Despite several achievements, it began to lose its sparkle. COVID-19, the Galwan clash, and the Ukraine conflict resulted in increased global economic stress, damaged India-China ties, and turned Russia into a diminishing power. The group may have lost its mojo, but numerous nations want to be admitted, thus showing the paradox of BRICS.
The balance sheet
Jim O’Neil’s conception of BRIC, a grouping of four emerging economies (Brazil, Russia, India, and China), may not have gone far but it was a popular acronym over two decades ago. However, two of its components joined hands with South Africa to form IBSA (India, Brazil, South Africa) in 2003. China was keen to join it in the century’s first decade and managed to enlist South Africa’s support. But Brazil and India would not go along, maintaining that the forum was open to democracies only. Rebuffed, China played a trump card, and decided to bring South Africa into BRIC, thus turning it into BRICS. Soon, the new club overshadowed the old one. IBSA has been unable to hold its summit since 2011. But BRICS has held 14 summits in the past 13 years.
BRICS focused its attention on both geopolitical and economic dimensions. By articulating a common view on key global and regional issues, it projected a non-western view. This strengthened the world’s march towards multipolarity, thus helping to curb the dominating influence of the West. On the economic front, it launched new initiatives: the New Development Bank which has committed $32.8 billion in 96 projects; the Contingent Reserve Arrangement (CRA), a financial mechanism to protect against global liquidity pressures; and a comprehensive programme to expand trade and investment cooperation among the five-member countries. However, negative tendencies soon asserted themselves. If the IBSA trio within the BRICS expected that China and Russia would fully back their bid to secure membership of the UN Security Council, they were disappointed. A formulation, frozen in time, patronisingly supporting ‘the aspiration’ of Brazil, India and South Africa to play a greater role in the UN, figures in every BRICS communiqué, showing the grouping’s utter diplomatic bankruptcy.
The century’s second decade was also the era of China’s dramatic economic rise and, more importantly, military assertiveness. This disturbed the group’s inner balance. The post-Ukraine consolidation of Russia-China cooperation, economic malaise in South Africa that accelerates dependence on China, and Brazil’s long fling with rightist policies followed by the return of a tired Lula da Silva as the President, have generated new tensions. Beijing’s push for a common currency for intra-BRICS trade is also symptomatic of the group’s inner troubles.
An admission rush
Yet, 19 countries now stand in line, eager to join BRICS. The regional breakup is as follows: Latin America (four) – Argentina, Nicaragua, Mexico and Uruguay; Africa (five) – Nigeria, Algeria, Egypt, Senegal and Morocco; and Asia (10) – Saudi Arabia, the United Arab Emirates (UAE), Türkiye, Syria, Iran, Afghanistan, Indonesia, Thailand, Kazakhstan and Bangladesh.
Several explanations may be offered. First, China is pushing the expansion as a strategic device to extend its global influence. Second, the demand to join BRICS stems from FOMO or ‘fear of missing out’ on the membership of a club that has some visibility. Third, many realize that the doors of other groupings are closed to them. Finally, the clamour reflects prevailing anti-western sentiments and a pervasive desire to create a sizeable forum of the Global South.
The next BRICS summit will be hosted by South Africa on August 23-24. It could take decisions on expansion and its criteria. Preparatory meetings of the Foreign Ministers and the National Security Advisers are certain to deliberate on this subject. Three options are available: a mega expansion that raises the membership from five to 21, thus surpassing the G-20; limited admission of 10 new members, two each supported by an existing member; and admission of only five new members, one each supported by an existing member, with none of the other four using their veto. India favours expansion if it is based on agreed criteria and moves gradually. Should the third option win consensus, Argentina, Egypt, Indonesia, UAE and Bangladesh are the most likely states to make the cut.
Will the BRICS leaders meet physically? Fairly unlikely. Because of its legal obligations relating to the ICC, South Africa as the host may be compelled to arrest an honoured guest — the President of Russia. Therefore, chances are that a digital summit will take place. When the leaders talk, they should reflect on strengthening BRICS and redressing the internal imbalance. They should also know that once new members are admitted, they will certainly seek to change the group’s name. Perhaps then the grouping’s future will be better than its past.
The group may have lost much of its sparkle, but a long queue of nations awaits membership.
Brazil, Russia, India, China and South Africa (BRICS)
The term, BRIC, was coined by Jim O’Neill of Goldman Sachs way back in 2001
He predicted that by year 2050, Brazil, Russia, India and China would become bigger than the 6 most industrialized nations in dollar terms and would completely change the power dynamics of the last 300 years
The first BRIC summit took place in the year 2009 in Yekaterinburg (Russia). In 2010, South Africa formally joined the association making it BRICS.
The chairmanship of the forum is rotated annually among the members, in accordance with the acronym B-R-I-C-S.
India is the chair for 2021.
Initiatives of the BRICS:
New Development Bank: During the Sixth BRICS Summit in Fortaleza (Brazil) in 2014, the leaders signed the Agreement establishing the New Development Bank (NDB – Shanghai, China). It has so far approved 70 infrastructure and sustainable development projects worth.
In 2014, the BRICS governments had signed a treaty on the setting up of the contingent reserve arrangement The arrangement is aimed at forestalling short-term balance of payments pressures, provide mutual support and strengthen financial stability of the BRICS nations.
BRICS countries are trying to create a payment system as an alternative to the SWIFT payment system. This has taken on a new urgency as post Ukraine war, Russia has been frozen out of SWIFT.
Customs agreement were signed to coordinate and ease trade transport between BRICS countries
Launched of Remote Sensing Satellite: A Remote Sensing constellation of satellites has been
launched – with 6 satellites including 2 from India, 2 from China, 1 from Russia, and 1 Brazil-China collaboration
The Telangana- A.P. water dispute
How did the Bachawat Tribunal allocate water resources to the three riparian States? What did the Andhra Pradesh Reorganisation Act, 2014, state about water shares? Has the Union government intervened in the issue? Why is Telangana asking for a larger share?
EXPLAINER
The story so far:
The nagging dispute over the water share of the Krishna river between Andhra Pradesh (A.P.) and Telangana remains unresolved, even nine years after the bifurcation of the combined State.
What is the origin of the Krishna water dispute?
The dispute dates back to the formation of Andhra Pradesh in November, 1956. Before the formation of Andhra Pradesh, four senior leaders each from different regions of Andhra, including the Rayalaseema Region and the Telangana region, signed a Gentlemen’s Agreement on February 20, 1956. Among others, one of the provisions of the agreement was the protection of Telangana’s interests and needs with respect to the utilisation of water resources with equitable distribution based on treaties followed globally. However, the focus of the combined dispensation with respect to irrigation facilities was on Andhra, which already had systems developed by the British at the cost of in-basin drought-prone areas in Telangana — a fact which was argued by the leaders of the latter region from the beginning.
Further on, in 1969, the Bachawat Tribunal (KWDT-I) was constituted to settle the dispute around water share among the riparian States of Maharashtra, Karnataka and Andhra Pradesh (before bifurcation). The Tribunal allocated 811 tmcft dependable water to Andhra Pradesh. The A.P. government later apportioned it in the 512:299 tmcft ratio between Andhra (including parts of Rayalaseema which comprise the Krishna Basin) and Telangana, respectively, based on the command area developed or utilisation mechanism established by then. The Tribunal had also recommended taking the Tungabhadra Dam ( a part of the Krishna Basin) water to the drought-prone Mahabubnagar area of Telangana. However, this was not followed through, giving birth to discontent among the people. Telangana had time and again reiterated how it had been meted out with injustice in Andhra Pradesh when it came to the matter of distributing water resources.
What was the arrangement for water sharing after the bifurcation?
There is no mention of water shares in the Andhra Pradesh Reorganisation Act, 2014, since the KWDT-I Award, which was still in force, had not made any region-wise allocation. At a meeting convened by the then Ministry of Water Resources in 2015, the two States had agreed for sharing water in the 34:66 (Telangana:A.P.) ratio as an ad hoc arrangement with the minutes clearly specifying that it has to be reviewed every year. The arrangement in the Act was only for the management of water resources by setting up two Boards, the Krishna River Management Board (KRMB) and the Godavari River Management Board (GRMB).
The KRMB, however, continued the same ratio year after year in spite of the opposition by Telangana. In October 2020, Telangana raised its voice for an equal share, till water shares are finalised. At a Board meeting held earlier this month, Telangana put its foot down for an equal share and refused to continue the existing arrangement. Unable to convince the member States, the river Board has referred the matter to the Ministry of Jal Shakti (MoJS).
What does each State claim?
Telangana has been asking the Centre to finalise water shares from day one of its formation. Citing treaties and agreements followed globally in sharing river waters, Telangana has been arguing that as per the basin parameters, it is entitled for at least a 70% share in the allocation of the 811 tmcft. Besides, it has been highlighting how A.P. has been diverting about 300 tmcft water to the areas outside the basin from fluoride-affected and drought-prone areas within the basin in Telangana.
On the other hand, A.P. has also been staking claim for a higher share of water to protect the interests of command areas already developed.
What is the stand of the Centre?
The Centre has convened two meetings of the Apex Council comprising the Union Minister and Chief Ministers of Telangana and A.P. in 2016 and 2020 without making any attempt to deal with the issue. Following a suggestion made by the MoJS in 2020, Telangana has withdrawn its petition over the issue in the Supreme Court as the Ministry had assured to refer the matter of water shares to a Tribunal. However, the Centre has been sitting over the issue for over two years now even as the two States continue to spar over the matter day in and day out.
THE GIST
In 1969, the Bachawat Tribunal was constituted to settle the dispute around water share among the riparian States of Maharashtra, Karnataka and Andhra Pradesh (before bifurcation). The Tribunal allocated 811 tmcft dependable water to Andhra Pradhesh. The A.P. government later apportioned it in the 512:299 tmcft ratio between Andhra and Telangana.
Telangana had time and again reiterated how it had been meted out with injustice in Andhra Pradesh when it came to the matter of distributing water resources.
The Centre has convened two meetings of the Apex Council comprising the Union Minister and Chief Ministers of Telangana and A.P. in 2016 and 2020, without making any attempt to deal with the issue.
What is the EU’s carbon border adjustment mechanism?
What is carbon leakage? How will the new policy affect trade between India and the EU?
The story so far:
On May 10, co-legislators at the European Commission signed the Carbon Border Adjustment Mechanism (CBAM). It has been described as a “landmark tool” to put a “fair price on the carbon emitted during the production of carbon intensive goods that are entering the EU, and to encourage cleaner industrial production in non-EU countries.”
What is the CBAM?
Its primary objective is to avert ‘carbon leakage’. It refers to a phenomenon where a EU manufacturer moves carbon-intensive production to countries outside the region with less stringent climate policies. In other words, replace EU-manufactured products with more carbon-intensive imports.
From 2026, once the CBAM is fully implemented, importers in the EU would have to buy carbon certificates corresponding to the payable carbon price of the import had the product been produced in the continent, under its carbon pricing rules. Conversely, if a non-EU producer is paying a price (or tax) for carbon used to produce the imported goods, back home or in some other country, the corresponding cost would be deducted for the EU importer. The Commission, in coordination with relevant authorities of the member states, would be responsible for reviewing and verifying declarations as well as managing the central platform for the sale of CBAM certificates. Importers would have to annually declare by May-end the quantity and embedded emissions in the goods imported into the region in the preceding year.
The idea here is to avert the possibility of carbon leakage alongside encouraging producers in non-EU countries to green their manufacturing processes. Moreover, it will ensure a level playing field between imports and EU products. This would also form part of the continent’s broader European Green Deal which endeavours to achieve 55% reduction in carbon emissions compared to 1990 levels by 2030 and become a climate neutral continent by 2050.
Why are countries worried?
CBAM would initially apply to imports of certain goods and selected precursors, whose production is carbon-intensive and are at risk of ‘leakage’ such as the cement, iron and steel, aluminium, fertilizers, electricity and hydrogen sectors.
In 2021, the United Nations Conference on Trade and Development (UNCTAD) had concluded that Russia, China and Turkey were most exposed to the mechanism. Considering the level of exports to the union in these sectors, it stated India, Brazil and South Africa would be most affected among the developing countries. Mozambique would be the most exposed least-developing country. Important to note, countries in the EU combined represent about 14% of India’s export mix for all products, steel and aluminium included.
Mannat Jaspal, Associate Fellow at the Observer Research Foundation (ORF) notes that India’s exports in the five segments represented less than 2% of the total exports to the EU between 2019 and 2021. However, according to Ms. Jaspal, while the impact of the regulation may appear limiting, its long-term effects can be severe for multiple factors. First, EU being India’s third largest trade partner and given the latter’s projected growth trajectories, the size of exports (including in the CBAM sectors) will invariably rise. Secondly, CBAM’s scope would expand beyond its current ambit to include other sectors as well. “Given India’s products have a higher carbon intensity than its European counterparts, the carbon tariffs imposed will be proportionally higher making Indian exports substantially uncompetitive,” she told The Hindu. And finally, international climate policies (including CBAM) will compel other countries to impose similar regulation eventually translating to “a significant impact” on India’s trading relationships and balance of payments.
It was informed, earlier this month. in a joint statement during the inaugural EU-India Trade and Technology Council, that “the two sides have also agreed to intensify their engagement on carbon border measures.”
THE GIST
On May 10, co-legislators at the European Commission signed the Carbon Border Adjustment Mechanism (CBAM).
Its primary objective is to avert ‘carbon leakage’. It refers to a phenomenon where a EU manufacturer moves carbon-intensive production to countries outside the region with less stringent climate policies.
CBAM would initially apply to imports of certain goods and selected precursors, whose production is carbon-intensive and are at risk of ‘leakage’ such as the cement, iron and steel, aluminium, fertilizers, electricity and hydrogen sectors.
Kelp forests:
Kelp forests are underwater ecosystems formed in shallow water by the dense growth of several different species.
They thrives in cold, nutrient-rich waters.
They attach to the seafloor and eventually grow to the water’s surface and rely on sunlight to generate food and energy, kelp forests are always coastal and require shallow, relatively clear water.
They provide underwater habitats to hundreds of species of invertebrates, fishes, and other algae and have great ecological and economic value.
Distribution of Kelp forest
Kelp forests have been observed throughout the Arctic by the Inuit. The Canadian Arctic alone represents 10 per cent of the world’s coastlines.
They have adapted to severe conditions. These cool water species have special strategies to survive freezing temperatures and long periods of darkness and even grow under sea ice.
In regions with cold, nutrient-rich water, they can attain some of the highest rates of primary production of any natural ecosystem on Earth.
Between Ellesmere Island and Labrador, as well as along the coasts of Lancaster Sound, Ungava Bay, Hudson Bay, Baffin Bay, and Resolute Bay in Hudson Bay and eastern Canada, kelp forests have been scientifically documented.
Significance:
It serves as a pertinent food source for a variety of marine creatures.
Kelps are responsible for producing up to 60% of the carbon found in coastal invertebrates.
As a diverse invertebrate and fish ecosystem, they serve as a habitat for birds to forage.
It releases carbon into the coastal ecology, increasing its productivity. New biomass, detritus, and other materials are produced through primary production by kelp.
SOURCE THE HINDU