DAILY CURRENT AFFAIRS BITS
TOPIC – 1 – 2023 FW13
Astronomers have recently discovered a ‘quasi-moon’ called ‘2023 FW13’ that orbits the Earth but is actually gravitationally bound by the Sun.
About 2023 FW13:
- It is an asteroid which has been designated as a quasi-satellite or a quasi-moon.
- It is among the few known quasi-moons or satellites that we know of in our solar system.
- It was identified by experts utilizing the Pan-STARRS telescope situated atop Hawaii’s Haleakala volcano.
- It has been in Earth’s vicinity since 100 BC and will keep circling our planet for at least another 1,500 years, until AD 3700.
- Features:
- The newfound asteroid 2023 FW13 circles the sun in sync with Earth.
- According to preliminary estimates, its diameter is from 10 to 20 meters.
- While not gravitationally bound to Earth in any discernible way (like our Moon), the asteroid’s bizarre orbit makes it circle our planet occasionally, earning it the name of a quasi-satellite or quasi-moon.
- At the closest point in its slightly elliptical orbit around Earth, the moon comes within about 223,693 miles (360,000 km) of our planet.
What are quasi-moons?
- Quasi-moons are also known as ‘quasi-satellites’ because they appear to orbit our planet in the same way that our natural satellite, the Moon.
- It is a space rock that circles the Earth, but is gravitationally bound by the sun.
TOPIC – 2 – Barents Sea
Geologists have recently discovered a never-before-seen volcano at the bottom of the Barents Sea off the coast of Norway, which is erupting with mud, fluids, and gas from the planet’s interior.
About Barents Sea:
- Location:
- It is a marginal sea of the Arctic Ocean.
- It is located along the northern coasts of Norway and Russia and divided between Norwegian and Russian territorial waters.
- The sea was known to Vikings and medieval Russians as the Murmean Sea.
- The current name of the sea is after the historical Dutch navigator Willem Barentsz.
- Boundaries:
- It is bounded by the Svalbard archipelago in the northwest, Franz Josef Land islands in the northeast, the Novaya Zemlya archipelago in the east, the Norwegian Seaand the Greenland Sea in the west, and by the Kola Peninsula in the south.
- It is separated from the Kara Sea by the Kara Strait and the Novaya Zemlya archipelago.
- The White Sea and the Pechora Sea are two parts of the Barents Sea.
- The White Sea is a southern arm of the Barents Sea, which separates the Kola Peninsula from the Russian mainland.
- The Pechora Sea is situated in the southeastern part of the Barents Sea.
- Features:
- It is a shallow sea, with an average depth of 230 metres.
- The sea’s deepest point is 600 m at the Bear Island Trench.
- The Barents Sea faces a subarctic climate.
- The waters of the Barents Sea have a high salinity of 34 parts per 1,000.
- Due to the North Atlantic drift, the Barents Sea has a high biological production compared to other oceans of similar latitude.
- Its topography is characterized by troughs and basins, separated by shallow bank areas
TOPIC – 3 – International Atomic Energy Agency (IAEA)
An International Atomic Energy Agency (IAEA) team recently arrived in Tokyo for a final review before Japan begins releasing massive amounts of treated radioactive water into the sea from the wrecked Fukushima nuclear plant.
About International Atomic Energy Agency (IAEA):
- It is widely known as the world’s “Atoms for Peace and Development” organization within the United Nations family.
- Mandate: It is the world’s central intergovernmental forum for scientific and technical co-operation in the nuclear field. It works for the safe, secure and peaceful uses of nuclear science and technology.
- History: Though established as an autonomous organisation, independently of the United Nations through its own international treaty, the IAEA Statute, the IAEA reports to both the United Nations General Assembly and Security Council.
- Headquarters: Vienna, Austria.
- Functions:
- The Agency works with its Member States and multiple partners worldwide to promote the safe, secure and peaceful use of nuclear technologies.
- It applies nuclear safeguards – consisting of monitoring, inspection, information analysis, and other activities – to verify that nuclear activities remain peaceful and detect and deter their diversion, including to weapons-related purposes.
- In particular, the IAEA implements comprehensive safeguards agreements mandated by the Nuclear Non-Proliferation Treaty (NPT), which serve as a first line of defense against nuclear weapons proliferation.
- IAEA assists its Member States and promotes the exchange of scientific and technical information between them.
- IAEA enhances national, regional, and international capacities to respond to nuclear and radiological incidents, which is essential to minimizing their impact.
What is the Nuclear Non-Proliferation Treaty (NPT)?
- It was an agreement signed in 1968 by several of the major nuclear and non-nuclear powers that pledged their cooperation in stemming the spread of nuclear technology.
- With 191 States parties, it is the most widely adhered to treaty in the field of nuclear non-proliferation, peaceful uses of nuclear energy and nuclear disarmament.
- Under the NPT, non-nuclear-weapon States parties have committed themselves not to manufacture or otherwise acquire nuclear weapons or other nuclear explosive devices while nuclear-weapon States parties have committed not to in any way assist, encourage or induce any non-nuclear-weapon State party to manufacture or otherwise acquire nuclear weapons or other nuclear explosive devices.
- Nuclear-weapon States parties under the Treaty are defined as those that manufactured and exploded a nuclear weapon or other nuclear explosive device before 1 January 1967.
- There are five nuclear-weapon States parties to the Treaty.
- Only Israel, India, and Pakistan have never been signatories of the Treaty, and North Korea withdrew from the Treaty in 2003.
TOPIC – 4 – Stolpersteine
A plaque commemorating a victim of Nazi persecution in Nuremberg became the 100,000th “Stolperstein” recently.
About Stolpersteine:
- Stolperstein are small, brass memorials placed in the pavements of cities across Europe to commemorate victims of Nazi persecution.
- The Stolpersteine are a project initiated by German artist Gunter Demnig since 1992.
- These small stones serve as a reminder of the atrocities committed during the Holocaust and the countless lives that were lost.
- “Stolperstein” is a German word meaning, literally, “stumbling stone,” or, metaphorically, “stumbling block.”
- The first Stolperstein was placed on 16 December 1992, a date which marked 50 years since an order was signed to begin the mass deportation of Jewish people and Roma from Germany.
- Each of the brass plaques embedded in pavements recalls the fate of a person who was persecuted by the Nazis, deported, murdered or driven to suicide.
- Unlike some other memorials that focus on specific persecuted groups, the Stolpersteine honour all victims of the Nazi regime, including Jewish, Sinti, Roma, disabled, dissident, and Afro-German and “asocial” citizens.
- The inscription on each stone begins “Here lived”, followed by the victim’s name, date of birth, and fate: internment, suicide, exile or, in the vast majority of cases, deportation and murder.
- Each Stolperstein is individually funded and can be sponsored by private individuals, schools or and organisations.
- It is the largest decentralized Holocaust memorial in the world.
TOPIC – 5 – Global Greenhouse Gas Watch (GGGW)
The World Meteorological Congress has approved a new greenhouse gas (GHG) monitoring initiative called Global Greenhouse Gas Watch (GGGW).
About Global Greenhouse Gas Watch (GGGW):
- It is a new greenhouse gas (GHG) monitoring initiative of the World Meteorological Organisation (WMO).
- GGGW will fill critical information gaps, providing an integrated, operational framework under all space-based and surface-based observing systems under one roof, along with modelling and data assimilation capabilities.
- It will build on WMO’s experience in coordinating international collaboration in predicting the weather and analysing climate on long-standing activities in greenhouse gas monitoring and research under the guidance of the Global Atmosphere Watch, established in 1989.
- GGGW predicts a top-down approach to the flux evaluation, which builds on existing capabilities in surface- and space-based observations and modelling, ensuring the timely exchange of all observations and data.
- The GGGW will consist of four main components:
- Comprehensive, sustained, global surface- and satellite-based observations of CO2, methane, and nitrous oxide concentrations, partial column amounts, total column amounts, vertical profiles, and fluxes supporting oceanic, meteorological, and terrestrial variables, internationally exchanged as rapidly as possible.
- Prior estimates of the GHG emissions based on the activity data and process-based models.
- Global high-resolution Earth system models representing GHG cycles.
- Data assimilation systems combining the observations with model calculations to generate products of higher accuracy.
Key facts about World Meteorological Organisation (WMO):
- It is a specialized agency of the United Nations (UN).
- It is the UN system’s authoritative voice on the state and behavior of the Earth’s atmosphere, its interaction with the oceans, the climate it produces, and the resulting distribution of water resources.
- It originated from the International Meteorological Organization (IMO), which was founded in 1873.
- Established in 1950, WMO became the specialized agency of the UN for meteorology(weather and climate), operational hydrology and related geophysical sciences.
- Headquarters: Geneva, Switzerland.
- Currently it has a membership of 187 countries.
- Governance Structure:
- Its supreme body is the World Meteorological Congress, which consists of representatives of all members. It meets at least every four years to set general policy and adopt regulations.
- A 36-member Executive Council meets annually and implements policy
TOPIC – 6 – 22nd Summit of the SCO Council of Heads
Recently, the Ministry of External Affairs announced that India will host the annual summit of the Shanghai Cooperation Organisation (SCO) in the virtual format on July 4, 2023.
About SCO Summit, 2023:
- It will be held in the virtual format.
- All the SCO Member States, China, Russia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan and Uzbekistan have been invited to attend the Summit.
- Iran, Belarus and Mongolia have been invited as Observer States.
- The theme of the Summit is ‘Towards a SECURE SCO’. The SECURE acronym stands for Security, Economy and Trade, Connectivity, Unity, Respect for Sovereignty and Territorial Integrity and Environment.
- India has set up new pillars of cooperation under its Chairmanship – Startups and Innovation, Traditional Medicine, Digital Inclusion, Youth Empowerment and Shared Buddhist Heritage.
About Shanghai Cooperation Organisation:
- The SCO was founded at a summit in Shanghai in 2001 by the presidents of Russia, China, the Kyrgyz Republic, Kazakhstan, Tajikistan and Uzbekistan.
- India and Pakistan became its permanent members in 2017.
- The SCO is an influential economic and security bloc and has emerged as one of the largest transregional international organisations.
- SCO has two Permanent Bodies – (i) SCO Secretariat in Beijing (ii) Executive Committee of the Regional Anti-Terrorist Structure (RATS) in Tashkent.
- The Regional Anti-Terrorist Structure serves to promote cooperation of member states against terrorism, separatism and extremism.
- The official working languages: Chinese and Russian.
TOPIC – 7 – Gongadi shawl
Recently, Telangana’s woollen gongadi shawls has been refashioned into shoes for farmers by alumni of the National Institute of Design, Ahmedabad.
- What it is? Gongadi, (known also as Kambal) is the traditional woolen blanket woven by the indigenous Kuruma pastoralist communities from wool of the indigenous Deccani sheep (known locally as Nalla gorrae) breed found in the Deccan Plateau region including the Indian state of Telangana.
- The famous blanket has once served the Indian Armed Forces to beat harsh winters at the borders.
- Features:
- The unique gongadi is not only the symbol of rich diverse traditional weaving culture of the Deccan region but also the pride and identity of the local indigenous pastoralist communities.
- The coarse woolen blanket is famous for its durability and versatility.
- The tough gongadi usually lasts for more than a decade and acquires this unique quality from the craft of hand weaving.
- One of the unique natures of gongadi is that it does not fade but grows darker in time.
- The indigenous Kuruma weavers say that gongadi is so strong that you can lift a fully grown bull off the ground with it.
- The traditional gongadi is produced organically, without using any dyes either natural or synthetic. Sizing of the strings is done using the paste of soaked and cooked tamarind seeds
TOPIC – 8 – Tele-Law Programme
Recently, The Ministry of Law informed that the Tele-Law programme achieved a new milestone with 40 lakh beneficiaries across the country empowered with pre-litigation advice.
About Tele-Law Programme:
- The Tele-Law programme comes under the Department of Justice, Ministry of Law and Justice and was launched in 2017.
- It is an e-interface mechanism to seek legal advice and consultation at a pre-litigation stage with the aim of ‘Reaching the Unreached’.
- The programme connects needy and marginalised people in need of legal aid with the Panel Lawyers via video conferencing/telephonic facilities available at Common Service Centres (CSCs) situated at the panchayat level. In addition, the service can also be accessed through the Tele-Law Mobile App.
- A Panel Lawyer is a practicing advocate selected by the Department of Justice and CSC-eGovernance Services or registered on the Panel of State /District Legal Services Authority.
- Eligibility: Legal advice is made available to everyone under Tele-Law service. Advice is free of Cost to those who are eligible for free legal aid under Section 12 of LSA Act, 1987.
- Women
- Children
- Persons belonging to Scheduled Caste and Scheduled Tribe
- Victims of Trafficking
- Mentally ill and differently-abled people
- Victims of natural disaster/ethnic violence
- Workers in unorganized sector/industrial workers
- Undertrials
- People of low-income group
- For all others, a nominal fee of Rs. 30/- is charged for each consultation.
- Kind of cases/matters: Legal matters in which advice can be taken through Tele-Law service include:
- Dowry, family dispute, divorce, protection from domestic violence
- Sexual harassment, sexual abuse, eve teasing at the workplace
- Maintenance of women children and senior citizens
- Rights regarding property and land
- Equal wages for males and females
- Maternity benefits and prevention of foeticide.
- Atrocities against scheduled castes/ scheduled tribes and their rehabilitation.
TOPIC – 9 – Purana Qila
A recent round of excavations at the site of Delhi’s Purana Qila or Old Fort has uncovered evidence of the continuous history of the city since the pre-Mauryan era.
About Purana Qila:
- Location:
- It is located on the South Eastern part of the present city of New Delhi.
- It is one of the oldest forts in Delhi and built on the banks of river Yamuna.
- The present citadel at Purana Qila started its construction in the reign of Humayun and was completed by Sher Shah Suri (‘The Lion King’).
- The Qila was inspired by Jama Masjid, which was established 15 years before the reconstruction of Qila.
- Architecture:
- It is rectangular in shape and is spread over an area of 1.5 kilometers.
- Another amazing feature of the Purana Qila are the three gates that are a display of a happy blend of Hindu and Muslim styles of architecture. – Bara Darwaza or the Big Gate facing west, the Humayun Gate facing south, and the Talaqqi Gate, which is often referred to as the forbidden gate.
- All of the gates are double-storeyed and comprise of huge semi-circular bastions flanking either of their sides.
- These bastions are equal in frequency, except for in the westward wall, where they are built at a distance of 73 meters from each other.
- The eastern and western walls of the Qila are the tallest, which were specifically designed for safeguarding the Kings residing within the four-walls.
- All the walls surrounding the Qila are 0.33 meters thick and supported by bastions.
TOPIC – 10 – Kanger Valley National Park
A rare Indian mouse deer or spotted Chevrotain was recently spotted in the Kanger Valley National Park in Chhattisgarh.
About Kanger Valley National Park:
- Location: It is located in Jagdalpur in Bastar district of Chhattisgarh state.
- The National Park derives its name from the Kanger River, which flows centrally from the Northwest to the Southeast direction.
- It got the status of a national park in the year 1982.
- Topography:It is noted for its highly heterogeneous land formations ranging from low flat and gentle areas to steep slopes, plateaus, valleys, and stream courses.
- It is home to three exceptional caves – famous for their amazing geological structures of Kutumbasar, Kailash and Dandak- Stellagmites and Stalactitees.
- National Park is known for the presence of underground limestone caves with dripstone and floston. The stalegmites and stalactite formation is still increasing.
- Tirathgarh Waterfall is located in Kanger Valley National Park.
- Vegetation: It is distinguished blend of mixed moist deciduous type of forests with the predominance of Sal, teak and bamboo.
- Fauna:
- Major wild animals include tigers, mouse deer, leopards, wildcat, sambar, chital, barking deer, langurs, jackals, rhesus macaque, flying squirrel etc.
- The areal fauna at the park consists of common hill myna, red jungle fowl, spotted owlet, racket-tailed drongos, parrots etc.
Key facts about rare Indian Mouse Deer or Spotted Chevrotain:
- It is the smallest deer in India and is highly nocturnal.
- Scientific Name: Moschiola indica
- Distribution:
- It is endemic to the Indian subcontinent.
- It is mainly found in peninsular India with some old records from Nepal.
- Sri Lanka has a separate species called spotted chevrotain (Moschiola meminna).
- Within India, it is commonly encountered in a number of forest areas along the Western Ghats, in the Eastern Ghats up to Orissa, and in the forests of central India.
- Features:
- It is small, 25-30 cm at shoulder height, and weighs from two to four kg.
- A unique feature of this group is that instead of four-chambered stomach like in other ruminants, they have a three-chambered stomach.
- It forages on forest floor for fruits, roots, leaves and herbs.
- It has occasionally been observed eating insects, crustaceans and even small mammals.
- Conservation Status:
- IUCN: Least Concern
TOPIC – 11 – Central Vigilance Commissioner
Recently, Vigilance Commissioner Praveen Kumar Srivastava was sworn in by President, as the Central Vigilance Commissioner.
About Central Vigilance Commission:
- Background:
- The Central Vigilance Commission was initially set up through Resolution in 1964 of Government of India, on the recommendations of Committee on Prevention of Corruption formed under the Chairmanship of Shri K. Santhanam.
- In 1997, The Supreme Court gave directions to Government of India to confer statutory status upon the Central Vigilance Commission.
- Then Centre government given statutory status to Central Vigilance Commission in 2003.
- Vision:
- To eliminate corrupt and unethical practices in public administration and to bring about transparency, fair-play, objectivity, accountability and responsiveness to the aspirations of the citizen from administration.
- Composition: Central Vigilance Commission consists of a Central Vigilance Commissioner as Chairperson and not more than two Vigilance Commissioners as Members.
- Organization Structure:
- The Central Vigilance Commission has its own Secretariat, Chief Technical Examiners’ Wing (CTE) and a wing of Commissioners for Departmental Inquiries (CDI).
- Chief Technical Examiners’ Wing (CTE) – Technical audit of construction works of Governmental organisations from a vigilance angle and Investigation of specific cases of complaints relating to construction works.
- Commissioners for Departmental Inquiries (CDIs) – The CDIs function as inquiry Officer to conduct oral inquries in departmental proceeding itiated against public servants.
- Removal: The Central Vigilance Commissioner or any Vigilance Commissioner shall be removed from his office only by order of the President on the ground of proved misbehavior or incapacity after the Supreme Court, on a reference made to it by the President, has, on inquiry, reported that the Central Vigilance Commissioner or any Vigilance Commissioner ought on such ground be removed.
TOPIC – 12 – Periodic Labour force Survey (PLFS)
According to the recent periodic labour force survey, the urban unemployment rate dipped further in the January to March 2023 quarter.
Key Points:
- The unemployment rate in current weekly status (CWS) for persons of age 15 years and above in urban areas declined to 6.8% in the January to March 2023 quarter.
- The urban labour force participation rate (LFPR) for all ages, however, inched up to a high of 38.1% in the fourth quarter of last fiscal from 37.9% in the October to December 2022 period.
- The urban LFPR for persons above 15 years of age was even higher at 48.5% in the fourth quarter of FY23.
About Periodic Labour force Survey:
- Considering the importance of availability of labour force data at more frequent time intervals, National Statistical Office (NSO) launched Periodic Labour Force Survey in April 2017.
- The objective of PLFS is:
- To estimate the key employment and unemployment indicators (viz. Worker Population Ratio, Labour Force Participation Rate, Unemployment Rate) in the short time interval of three months for the urban areas only in the ‘Current Weekly Status’ (CWS).
- To estimate employment and unemployment indicators in both ‘Usual Status’ (ps+ss) and CWS in both rural and urban areas annually.
- These indicators are defined as follows:
- Labour Force Participation Rate (LFPR): LFPR is defined as the percentage of persons in labour force (i.e. working or seeking or available for work) in the population.
- Worker Population Ratio (WPR): WPR is defined as the percentage of employed persons in the population.
- Unemployment Rate (UR): UR is defined as the percentage of persons unemployed among the persons in the labour force.
- Current Weekly Status (CWS): The activity status determined on the basis of a reference period of last 7 days preceding the date of survey is known as the current weekly status (CWS) of the person.
- It is conducted by the National Sample Survey (NSO), working under Ministry of statistics and programme implementation (MoSPI).
TOPIC – 13 – Chandrayaan-3
Recently, chief of Indian Space Research Organisation (ISRO) confirmed that Chandrayaan-3 will be launched in July, 2023.
About Chandrayaan-3:
- Chandrayaan-3 is a follow-on mission to Chandrayaan-2 to demonstrate end-to-end capability in safe landing and roving on the moon.
- The propulsion module will carry the lander and rover configuration till 100 km lunar orbit.
- It would launched by LVM3 from Satish Dhawan Space Centre in Sriharikota.
- Mission Life (Lander & Rover) – One Lunar day (~ 14 earth day).
- ISRO’s ambitious Chandrayaan-3 mission is aimed at demonstrating critical technologies to land the spacecraft on the south pole of the moon.
- Chandrayaan-3 spacecraft is a composite of three modules — propulsion, lander and rover.
- Chandrayaan-3 mission carries scientific instruments to study the thermo-physical properties of the lunar regolith, lunar seismicity, lunar surface plasma environment and elemental composition in the vicinity of the landing site.
- The lander being launched to the Moon with Chandrayaan-3 will have Chandra’s Surface Thermophysical Experiment to measure the thermal conductivity and temperature, along with the Instrument for Lunar Seismic Activity that will estimate the seismicity around the landing site, and a Langmuir Probe to calculate the plasma density and its variations.
- The rover, will have the Alpha Particle X-ray Spectrometer and the Laser-Induced Breakdown Spectroscopy instrument for deriving the elemental composition in the vicinity of the landing site.
TOPIC – 14 – Shenzhou-16
China launches Shenzhou-16 mission to Chinese space station.
- The spacecraft, Shenzhou-16, or Divine Vessel, and its three passengers lifted off atop a Long March-2F rocket from the Jiuquan Satellite Launch Centre in the Gobi Desert in northwest China.
- China has already announced plans to expand its permanently inhabited space outpost, with the next module slated to dock with the current T-shaped space station to create a cross-shaped structure.
- Beijing is expected to launch one more crewed mission to the orbiting outpost this year.
- Xuntian – By the end of 2023, China is due to a launch space telescope the size of a large bus.
- Known as Xuntian, or Surveying the Heavens in Chinese, the orbital telescope will boast a field of view 350 times wider than that of the Hubble Space Telescope, which was launched 33 years ago.
- Tiangong – Tiangong is China’s permanent space station that will operate in low-Earth orbit at an altitude from 340 km to 450 km.
- Tiangong Space Station is named after the Chinese word for ‘heavenly palace’ or ‘celestial palace’.
- The station has a designed lifespan of at least 10 years.
TOPIC – 15 – Solar Power Plant in Space
Japan is aiming to launch solar panels into orbit and transmit electricity to the ground using microwaves.
- Countries around the world are in a race to set up solar power plants in space and beam energy back to Earth.
- The United Kingdom and China have already displayed interest in building such a technology and now, Japan seems to be the latest member to join the bandwagon.
- Space Energy Initiative – The UK-based Space Energy Initiative proposed building such a plan to beam back energy from space.
- Its reasoning was that a space-based plant would produce so much more electricity than one of a similar size on Earth.
- According to the organisation, if there were two plants with the exact same size, one on Earth in the UK and one in space, the one in space would be able to generate over 13 times the energy.
- Space-based power plant will not face any intermittence problems.
- The Sun will always be shining on it in space.
- On Earth, the Sun will not always shine on a solar plant.
- Due to this, solar energy plants will have to be complemented with battery storage systems to prevent power loss during unfavourable weather.
Japan’s plans to build a solar power plant in space
- A Japanese public-private partnership aims to launch solar panels into space at an altitude of 36,000 kilometres above our planet.
- The power generated by the solar facility will be converted into microwave radiation and sent down to ground-based receiving stations.
- U.K. – In UK over 50 British organisations, including Airbus, Cambridge University and satellite maker SSTL have joined the UK Space Energy Initiative to work towards such a technology.
- The initiative has a plan to have a demonstrator plant in orbit as early as 2035.
- China – The country plans to launch a solar power plant in space by the year 2028.
- However, the Chinese satellite will be launched to an altitude of 400 kilometres.
TOPIC – 16 – RBI Annual Report: India’s growth momentum
According to the Reserve Bank of India Annual Report 2022-23, the Indian economy will be supported by effective macroeconomic policies, lower commodity prices, and a strong banking sector, among other things.
Key highlights of the RBI’s Annual Report 2022-23:
- India’s growth momentum is likely to be sustained in 2023-24 in an atmosphere of easing inflationary pressures.
- Economy Dependency: The economy will be supported by sound macroeconomic policies, softer commodity prices, a robust financial sector, continued fiscal policy thrust on quality of government expenditure, and new growth opportunities stemming from global realignment of supply chains.
- Growth Rate: The slowing global growth, protracted geopolitical tensions and a possible upsurge in financial market volatility following new stress events in the global financial system could pose downside risks to growth. It is important, therefore, to sustain structural reforms to improve India’s medium-term growth potential.
- Domestic Economy: While emphasising that domestic economic activity does face challenges from an uninspiring global outlook going forward, resilient domestic macroeconomic and financial conditions, expected dividends from past reforms and new growth opportunities from global geo-economic shifts place India in an advantageous position.
- Inflation: The risks to inflation have moderated with downward corrections in global commodity and food prices and easing of the pass-through from high input cost pressures of last year.
- Repo Rate: The cumulative increase in policy repo rate by 250 bps last year would steer the disinflationary process, along with supply side measures to address transient demand-supply mismatch due to food and energy shocks.
- Monetary Policy: It remains focused on withdrawal of accommodation to ensure that inflation progressively aligns with the target, while supporting growth.
- Global Supply Chains: As per the Annual Report the realignment of global supply chains, transition to green energy and ongoing technological advancements provide a congenial environment for a pick-up in investment activity and raising productivity.
- Balance sheets of Corporates and Banks: Robust balance sheets of corporates and banks, coupled with high capacity utilisation, would aid in strengthening the momentum in private investment.
- Household Demand: Burgeoning credit growth, especially housing and personal loans, reflects steady domestic household demand. This is also mirrored in several high frequency indicators of rural and urban demand.
- Agriculture Production: Robust agriculture production buoyed by expectation of a bountiful rabi harvest and resilience in allied sector activity are also brightening the outlook for rural demand.
- Manufacturing: Traction in construction activity is likely to be sustained as reflected in steady expansion in its proximate indicators: steel consumption and cement production.
- Transportation: Port cargo traffic and railway freight traffic movements also point to industrial activity picking up amidst gradual easing of input cost pressures.
- Agriculture and allied activities: They were resilient in 2022-23, with gross value added (GVA) registering a growth of 3.3%.
- Industrial Sector: The manufacturing activity withstood global spillovers, while electricity generation exhibited robust growth, and mining recorded steady activity. Sustained momentum was seen in construction activity, while infrastructure and capital goods production benefitted from the government-led investment in infrastructure.
- Estimated Growth: The Indian economy is expected to have recorded a growth of 7.0% in real GDP in 2022-23.
TOPIC – 17 – U.S. and China Bilateral Relation
Recently, the United States has stated that it is switching from decoupling to de-risking in its approach to China.
Key highlights:
- The Trump-era focus of the U.S. to decouple from China is being phased out by a new concept.
- The U.S. has expressed that it is shifting its policy on China from decoupling to de-risking.
- The EU has already declared that its approach to China will be based on de-risking.
What is ‘de-risking’?
- United States administration stated that “decoupling” has been changed to “de-risking”.
- De-risking: According to the U.S. National Security Advisor, “de-risking fundamentally means having resilient, effective supply chains and ensuring we cannot be subjected to the coercion of any other country”.
- Objective: De-risking aims to limit such an effect only in areas where it undercuts the national security and industrial competence of the U.S.
- Decoupling: It stands for an eventual reversal of the four-decade old project to enmesh the two economies.
When the U.S. and China diplomatic ties established?
- After the establishment of diplomatic ties between the S. and China in 1979, both the countries embarked on a path of increasing economic interdependence.
- China gained immensely from this relationship, as it helped the country drastically widen and deepen its diplomatic and economic engagement with the rest of the world.
- As China’s economic and military power grew, its ambition to challenge the primacy of the U.S. in the international system became increasingly apparent.
- China’s rise not only came at the expense of America’s global clout, but also the latter’s domestic industry, which got “hollowed out” in its four-decade old economic embrace with China.
Why de-risking?
- In order to understand the rationale behind the U.S.’s shift from decoupling to de-risking because:
- Geopolitical significance
- Disruption of global economy
- Tensions on Taiwan Strait
- Acrimonious Spy balloon
- Russia-Ukraine Conflict
- Trans-Atlantic Consensus
EDITORIAL – 1 – Evergreening of loans
Why in news?
- Recently, Reserve Bank of India Governor, while addressing bank board, raised concerns over banks using innovative methods for evergreening of loans.
- As per him, banks are covering up the real status of stressed loans of corporates – to project an artificial clean image in cahoots with corporates.
What’s in today’s article?
- Evergreening of loans
- News Summary
Evergreening of loans
- Evergreening of loans refers to a practice used by financial institutions to extend or renew existing loans to borrowers who are struggling to repay their debts.
- It involves granting additional funds or rolling over the outstanding debt, often with modified terms or conditions.
- This is done to create the appearance that the borrower is making timely repayments and maintaining a healthy credit profile.
- The evergreening of loans allows borrowers to maintain the illusion of ongoing financial stability by continuously obtaining new loans to cover existing obligations.
Why do financial institutions engage in evergreening of loans?
- To avoid recognizing non-performing assets (NPA) on their balance sheets
- If an account turns into an NPA, banks are required to make higher provisions which will impact their profitability.
- A loan turns into an NPA, if the interest or instalment remains unpaid even after the due date — and remains unpaid for a period of more than 90 days.
- So, to avoid classifying a loan as an NPA, banks adopt the evergreening of loans.
- If an account turns into an NPA, banks are required to make higher provisions which will impact their profitability.
- To maintain a positive relationship with borrowers
- Some banks have even extended such loans to wilful defaulters to keep them out of the defaulters’ books.
- By providing additional credit, financial institutions can retain clients who might otherwise default on their loans.
Risks associated with evergreening of loans
- Inflates the quality of the institution’s loan portfolio
- This practice artificially inflates the quality of the institution’s loan portfolio and can mislead investors, regulators, and the public about its financial health.
- Can lead to a cycle of increasing debt
- This approach may be seen as a short-term solution to prevent immediate defaults.
- However, it can lead to a cycle of increasing debt and further financial instability for both borrowers and lenders in the long run.
- Problematic for the overall stability of the financial system
- Evergreening of loans can be problematic for the overall stability of the financial system.
- It can mask the true extent of bad loans in an economy, creating systemic risks and distorting the assessment of creditworthiness.
- Sign of misgovernance
- This is purely misgovernance, so that bad loans are made to look good many a time by additional lending to troubled borrowers.
- It normally happens due to the unholy relationship between bankers and borrowers.
- The CBI had detected several cases of fund diversion by promoters of companies from loans advanced again and again by banks in the last couple of years.
- Contributes to the crowding-out effects
- In India, there is evidence of a practice called indirect evergreening.
- This involves struggling companies borrowing money from weak banks through related parties, but instead of using the funds for productive investments, they increase their debt levels.
- This kind of activity is often overlooked and not easily detected.
- As a result, valuable resources are misallocated, which contributes to the crowding-out effects typically associated with financially vulnerable companies.
How can evergreening be stopped?
- As per the Committee to Review Governance of Boards of Banks in India headed by PJ Nayak, wherever significant evergreening in a bank is detected by the RBI:
- penalties should be levied through cancellations of unvested stock options;
- claw-back of monetary bonuses on officers concerned and on all whole-time directors;
- the Chairman of the audit committee be asked to step down from the board.
- The primary defence against evergreening must however come from the CEO, the audit committee and the board.
- The audit committee, in particular, needs to be particularly vigilant.
- If significant evergreening is detected, it must mean that evergreening is wilful, with support from sections of the senior management of the bank.
- It then becomes necessary to levy penalties and action against the erring officers.
News Summary:
- During the supervision of banks, the RBI noticed certain instances wherein banks were using innovative ways to conceal the real status of stressed loans.
- This was revealed by the RBI Governor in his address to the board of directors of public sector and private lenders.
Evergreening methods used by Banks: as highlighted by the RBI Governor
- Bringing two lenders together to evergreen each other’s loans by sale and buyback of loans or debt instruments;
- Good borrowers being persuaded to enter into structured deals with a stressed borrower to conceal the stress;
- In other words, financially sound and reliable borrowers are encouraged to engage in specific agreements or transactions with borrowers who are facing financial difficulties.
- This is to hide or mask the financial distress of the borrower who is struggling.
- By involving creditworthy borrowers in such arrangements, it creates a façade of stability and financial health for the stressed borrower.
- Use of internal or office accounts to adjust borrower’s repayment obligations;
- Renewal of loans or disbursement of new/additional loans to the stressed borrower or related entities closer to the repayment date of the earlier loans.
EDITORIAL – 2 – RBI’s lightweight payment and settlements system
Why in news?
- The Reserve Bank of India (RBI) has conceptualised a lightweight payment and settlements system, which it is calling a “bunker” equivalent of digital payments.
- The central bank has not offered a timeline for the launch of this payments system yet.
What’s in today’s article?
- Payment and settlements system in India
- News Summary
Payment and settlements system in India
- About
- Payment and settlement systems refer to the infrastructure and processes that enable the transfer of funds and the settlement of financial transactions between individuals, businesses, and financial institutions.
- An efficient payment system promotes market efficiency and reduces the cost of exchanging goods and services.
- By the same token, its failure can result in loss of confidence in the financial system and in the very use of money.
- India’s payment and settlement system has witnessed remarkable growth, driven by technological advancements, government initiatives, and changing consumer preferences.
- Regulatory framework
- The Reserve Bank of India (RBI) regulates and oversees the payment and settlement systems in the country.
- The Board for Regulation and Supervision of Payment and Settlement Systems (BPSS), chaired by the Governor, RBI, spearheads this responsibility.
- In 2005, RBI created Department of Payment and Settlement Systems (DPSS) to focus exclusively on payment and settlement systems.
- Subsequently, the government enacted the Payment and Settlement Systems Act, 2007 (PSS Act).
- The Reserve Bank of India (RBI) regulates and oversees the payment and settlement systems in the country.
Components of Payment and Settlement Systems
- Paper-based Payments
- Use of paper-based instruments (like cheques, drafts, and the like) accounts for nearly 60% of the volume of total non-cash transactions in the country.
- Electronic Clearing Service (ECS) Credit
- Later in 2008, RBI launched a new service known as National Electronic Clearing Service (NECS).
- National Electronic Funds Transfer (NEFT) System (launched in 2005)
- Available across a longer time window, the NEFT system provides for batch settlements at hourly intervals, thus enabling near real-time transfer of funds.
- Real Time Gross Settlement (RTGS)System (introduced in in 2004)
- RTGS is a funds transfer systems where transfer of money takes place from one bank to another on a real time (no waiting time) and on gross basis.
- Clearing Corporation of India Limited (CCIL)
- CCIL was set up in April 2001 by banks, financial institutions and primary dealers.
- It was established to function as an industry service organisation for clearing and settlement of trades in money market, government securities and foreign exchange markets.
- Immediate Payment Service (IMPS) – Launched in 2010
- IMPS is an interbank electronic funds transfer system that enables instant money transfers 24/7.
- Other Payment Systems
- Pre-paid Payment Systems
- Mobile Banking System
- ATMs / Point of Sale (POS) Terminals / Online Transactions
- Unified Payments Interface (UPI): UPI is a real-time payment system developed by the National Payments Corporation of India (NPCI).
- Mobile Wallets: Mobile wallets, such as Paytm, PhonePe, and Google Pay, have become increasingly popular in India.
- Aadhaar Enabled Payment System (AEPS): AEPS is a biometric-based payment system that leverages the UIDAI Aadhaar database.
News Summary: RBI’s lightweight payment and settlements system
- In a proactive move to address potential disruptions caused by catastrophic events or volatile situations, the RBI has unveiled a new initiative: the Lightweight Payment and Settlement System (LPSS).
- This new system can be operated from anywhere by a bare minimum staff in exigencies such as natural calamities or war.
- The infrastructure for this system will be independent of the technologies that underlie the existing systems of payments such as UPI, NEFT, and RTGS.
Need for such a lightweight payments system
- According to the RBI, existing conventional payments systems such as RTGS, NEFT, and UPI are designed to handle large volumes of transactions while ensuring sustained availability.
- As a result, they are dependent on complex wired networks backed by advanced IT infrastructure.
- However, catastrophic events like natural calamities and war have the potential to render these payment systems temporarily unavailable by disrupting the underlying information and communication infrastructure.
- Therefore, it is prudent to be prepared to face such extreme and volatile situations.
Benefits of such a lightweight payments system
- Could ensure near zero downtime of the payment and settlement system
- In its Annual Report for 2022-23, RBI says that the lightweight and portable payment system is expected to operate on minimalistic hardware and software, and would be made active only on a need basis.
- Hence, such a lightweight and portable payment system could ensure near zero downtime of the payment and settlement system in the country.
- Can keep the liquidity pipeline of the economy alive
- It has potential to keep the liquidity pipeline of the economy alive and intact.
- It can do so by facilitating uninterrupted functioning of essential payment services like bulk payments, interbank payments and provision of cash to participant institutions.
- Can ensure stability of the economy
- The system is expected to process transactions that are critical to ensure the stability of the economy, including government and market related transactions.
- Can enhance public confidence in digital payments
- Having such a resilient system is also likely to act as a bunker equivalent in payment systems.
- Hence, it can enhance public confidence in digital payments and financial market infrastructure even during extreme conditions.
EDITORIAL – 3 – Unboxing the ‘export turnaround’ in India’s toy story
Context
- During 2020-21 and 2021-22, India has become a net exporter of toys, ending a long import dominance.
- However, whether this turnaround represents a sustained rise in investment or a short-term outcome of protectionism and COVID-19 pandemic-related global disruptions is a matter of debate.
Indian Toy Industry
- In 2015-16, the industry had about 15,000 enterprises or establishments (organised and unorganised combined).
- The production stood at ₹1,688 crores using fixed capital of ₹626 crores at current prices and employing 35,000 workers.
- Registered factories (those employing 10 or more workers regularly) accounted for 1% of the number of factories and enterprises, employed 20% of workers, used 63% of fixed capital, and produced 77% of the value of output.
- However, during the one-and-half decades between 2000 and 2016, industry output was halved in real terms (net of inflation) with job losses.
- Domestic market size currently stands at an estimated value of $ 1.5 Bn.
- Labour-intensive toy categories like dolls, soft toys and board games offer significant manufacturing potential in India due to inherent cost competitiveness and growing demand.
- The sector is dominated by small & medium sized manufacturers.
- Over 4,000 toy units in the MSME Sector significantly contribute to both manufacturing and exports to large global & domestic brands.
Indian Toy Industry Share in Global Market
- India’s exports stand at a mere half-a-percentage point.
- Between 2014-19, the Indian toy industry witnessed negative productivity growth.
- Imports accounted for up to 80% of domestic sales until recently. Between 2000 and 2018-19, imports rose by nearly three times as much as exports.
- But in recent years, the Indian toy industry is expanding its global presence, with increased high-value exports to Middle East and African countries.
- The Indian toy industry is among the fastest-growing globally, projected to reach $3 Bn by 2028, growing at a CAGR of 12% between 2022-28.
What explains India’s Negligible Share in Global Toy Market?
- Inward-Oriented Industrial Policy
- Asia’s successful industrialising nations promoted toy exports for job creation, starting with Japan about a century ago, China since the 1980s, and currently Vietnam following in their footsteps.
- In contrast, India followed an inward-oriented industrial policy in the Planning-era, which sheltered domestic production by providing a “double protection” by imports tariffs and reservation of the product for exclusive production in the small-scale sector known as the “reservation policy.”
- As a result, Toy manufacturing remained stagnant, archaic, and fragmented, even as imports of modern, safe, and branded toys boomed.
The Export Turnaround and Import Contraction
- There has been a sixfold increase in Indian toy exports in 2021-22 compared to 2013-14.
- Toys have been recognised as one of the champion sectors with significant export potential.
- Toy exports increased from $109 million (₹812 crore) to $177 million (₹1,237 crore) between 2018-19 and 2021-22.
- Imports declined from $371 million (₹2,593 crore) to $110 million (₹819 crore).
Reason Behind Import Contraction
- Increased Custom Duty: Imports contracted as the basic custom duty on toys tripled from 20% to 60% in February, 2020.
- Numerous non-tariff barriers were imposed as well such as production registration orders and safety regulation codes, which contributed to import contraction.
Is the Export Turnaround a sign of Sustained Growth due to govt policies?
- The turnaround in toy exports is based on data from just two recent years, and during the COVID-19 pandemic, it is perhaps too premature to claim policy success.
- The potential for sustaining net exports appears slim as the industry has hardly made sustained investment to boost output and exports.
- The turnaround does not seem to be the outcome of strengthening domestic investment and production on a sustained basis.
- Since around 2000, the industry has shrunk with rising imports, until two years ago.
Government’s Policy Initiatives Impact on the Toy industry
- Impact of “Make in India”
- The annual value of output and fixed investment at constant prices (net of inflation) after peaking in 2007-08, have trended downwards with considerable fluctuations (except for 2019-20).
- Apparently, there is no evidence of ‘Make in India’ positively affecting these indicators on a sustained basis.
- The output of the informal or unorganised sector shrank, though it continues to account for most establishments and employment.
- Industry De-reservation Effect
- In 1997, in the wake of liberal reforms, the reservation policy was abolished.
- New firms entered the organised sector, but only for a while, and productivity growth improved.
- Despite early positive trends, industry de-reservation failed to sustain output, investment, and productivity growth after 2007-08.
Some Other Government Schemes to Strengthen the Toy Industry
- Central Government Schemes
- Scheme For Granting Recognition & Registration to In-House R&D Units
- Remission Of Duties & Taxes on Exported Products (RoDTEP)
- Duty Drawback Scheme
- Export Promotion Capital Goods (EPCG) Scheme
- Custom Bonded Warehouse Scheme
- Increase in basic custom duty (BCD) for Electronic Toys from 5% to 15% to encourage domestic manufacturing
- State Incentives
- Capital subsidy
- Stamp duty exemption
- Interest subsidy
- Tax reimbursement
- Electrical duty exemption
What should be Policymakers’ strategy for a sustainable long-term term industry growth?
- The policymakers should look beyond simplistic binaries; planning versus reforms.
- There is a need to examine the ground reality of industrial locations and clusters to tailor policies and institutions to nurture such industries.
EDITORIAL – 4 – France Bans Short-Haul Domestic Flights
Why in News?
- Last week, France announced a ban on all short-haul domestic flights.
- A month earlier, the Schiphol airport in Amsterdam, one of the busiest in Europe, banned private jets and small business planes.
- There is a growing clamour in Europe for a bigger crackdown on private aviation sector.
What’s in Today’s Article?
- Context (Aviation Ban in France)
- CO2 Emissions from Aviation Sector (Data, Role of Private Jets, Pollutants involved, etc.)
- Challenges and Solution w.r.t. Emissions from Aviation Sector
Context (Aviation Ban in France):
- France, last week, became the first country in the world to impose a ban on short-haul domestic flights.
- The country brought in a new law, effective from May 23, that bars air travel to destinations that can be covered by up to two-and-a-half hour journey by train.
- There is growing demand for a wider crackdown on private aviation.
- Apart from France, the Netherlands, Austria and Ireland urged the European Union to strengthen regulations to discourage travel by private jets in order to reduce CO2 emissions from aviation industry.
CO2 Emissions from Aviation Industry:
- In 1960, 100 million passengers travelled by air, at the time a relatively expensive mode of transportation available only to a small fraction of the public.
- By 2019, the total annual world-wide passenger count was 4.56 billion.
- In 2021 aviation accounted for over 2% of global energy-related CO2 emissions, having grown faster in recent decades than road, rail or shipping.
- As it stands, the aviation sector produces 900 million CO2 per year, according to International Air Transport Association (IATA).
- By 2050, if nothing is done to reduce the industry’s carbon footprint, that will rise to 1.8 billion tons.
- Reducing this level to gradually achieve net zero emissions in 2050 poses an enormous technological challenge that the IATA estimates will cost companies around USD 1.55 trillion between 2020 and 2050.
Contribution of Private Jets in CO2 Emissions:
- Private jets, usually far more inefficient than large commercial airliners, have always been a big eyesore from the climate perspective.
- In a recent report, it was found that private jets were 5 to 14 times more polluting, per passenger, than commercial planes, and 50 times more polluting than trains.
- It said private planes could emitting about 2 tonnes of carbon dioxide every hour, while an average person in Europe emits about 8.2 tonnes of carbon dioxide equivalent in an entire year.
Impact of Emissions from Airplanes:
- CO2 is the largest component of aircraft emissions, accounting for approximately 70 percent of the exhaust.
- After being emitted, 30 percent of a given quantity of the gas is removed from the atmosphere naturally over 30 years, an additional 50 percent disappears within a few hundred years, and the remaining 20 percent stays in the atmosphere for thousands of years.
- Water vapor is also a product of jet fuel consumption, making up about 30 percent of the exhaust.
- With its short lifespan in the atmosphere as part of the water cycle, water vapor from aircraft has a minimal direct warming impact.
- However, its presence in the exhaust plume has an indirect impact by contributing to the formation of contrails.
- All the remaining emissions in the graphic make up less than one percent of the exhaust plume.
What is the Solution to Reduce CO2 Emissions from Aviation Industry?
- IATA says that the main solution lies in the use of sustainable aviation fuels (SAF).
- These fuels – made from biomass, waste oils and could even be made from carbon capture in future – have the advantage that they can be used directly in existing aircraft.
- Such fuel sources can reduce CO2 emissions by 80 percent compared to kerosene over their entire life cycle.
- Two leading plane manufacturing corporations, Airbus and Boeing, have pledged that their fleets will be able to fly 100 percent on SAF by 2030.
Challenges Associated with SAF:
- Currently, SAF accounts for only 0.1 percent of aviation fuel.
- Encouraged by governments, the infrastructure to produce SAF is being set up in the US and Europe, but is still embryonic – and the cheapest fuel that comes out costs four time more than kerosene.
Offset Mechanism for Reducing Emissions from Aviation Industry:
- In 2016, the International Civil Aviation Organisation (ICAO) put in place an offset mechanism to ensure that any increase in emissions over 2020 levels is compensated for by the airline industry through investment in carbon saving projects elsewhere.
- Called Carbon Offsetting and Reduction Scheme for International Aviation, or CORSIA, the offset plan is supposed to run from 2021 to 2035.
- CORSIA is considered a breakthrough, but it is not very ambitious. It only seeks to offset emissions that are over and above 2020 levels. It does not deal with total emissions.
Conclusion:
- Reducing aviation emissions through other means has not proved to be easy.
- Unlike road or rail travel, aviation does not have viable technology alternatives for shifting to cleaner fuels.
- Biofuels have been tried and so have hydrogen fuel cells. Solar powered planes have also made trips.
- But use of these alternative fuels for flying large commercial airliners is still some distance away.
EDITORIAL – 5 – Article 299 of the Constitution: Can the govt claim immunity when entering contracts under the President’s name?
Why in News?
- The Supreme Court held that the government, when entering into a contract under the President’s name, cannot claim immunity from the legal provisions of that contract under Article 299 of the Constitution.
What’s in Today’s Article?
- What is Article 299 of the Indian Constitution?
- Procedure to be Followed for Making a Contract
- What are the Requirements for Government or State Contracts?
- What was the Case?
- The Apex Court’s Ruling
What is Article 299 of the Indian Constitution?
- Article 298: It grants the Centre and the state governments the power to carry on trade or business, acquire, hold, and dispose of property, and make contracts for any purpose.
- Article 299: It provides that all contracts made in the exercise of the executive power of the Union or of a State shall be
- Expressed to be made by the President or by the Governor of the State.
- Executed on behalf of the President or the Governor by persons in a manner as directed and authorised by them [Article 299 (1)].
Procedure to be Followed for Making a Contract:
- In 1954, the top court held that there must be a definite procedure according to which contracts must be made by agents acting on the government’s behalf; otherwise, public funds may be depleted by illegitimate contracts.
- It implies that contracts not adhering to the manner given in Article 299(1) cannot be enforced by any contracting party.
- However, Article 299 (2) says that neither the President nor the Governor can be personally held liable for such contracts.
What are the Requirements for Government or State Contracts?
- In 1966, the apex court laid down essential requirements for government contracts under Article 299.
- 3 conditions to be met before a binding contract against the government could arise:
- The contract must be expressed to be made by the Governor or the President;
- It must be executed in writing, and
- The execution should be by such persons and in such a manner as the Governor or the President might direct or authorise.
What was the Case?
- The case dealt with an application filed by Glock Asia-Pacific Limited, a pistol manufacturing company, against the Centre regarding the appointment of an arbitrator in a tender-related dispute.
- According to the Arbitration and Conciliation Act, 1996, any person whose relationship with the parties or counsel of the dispute falls under the 7th Schedule (of the Act) will be ineligible to be appointed as an arbitrator.
- The 7th Schedule includes relationships where the arbitrator is an employee, consultant, advisor, or has any other past or present business relationship with a party.
The Apex Court’s Ruling:
- Referring to the 246th Law Commission Report, the court observed that when the party appointing an arbitrator is the State, the duty to appoint an impartial and independent adjudicator is even more onerous.
- Thus, the court rejected the Centre’s reliance on Article 299, saying that Article 299 only lays down the formality that is necessary to bind the government with contractual liability.
- Thus, the substantial law relating to the contractual liability of the Government is to be found in the general laws of the land.
- The court also appointed former SC judge Justice Indu Malhotra “as the Sole Arbitrator to adjudicate upon the disputes” in the case.