PIB Summary- 3rd May, 2021 | PIB (Press Information Bureau) Summary - UPSC PDF Download

Asian Development Bank

Context:

Finance Minister participated in Governor’s Seminar as part of Asian Development Bank’s annual meeting 2021.

Details:

• The Governor’s Seminar was held as part of the ADB’s annual meeting and it was on “Cooperation for a Resilient Future”.

Know about the Asian Development Bank for UPSC

1. Asian Development Bank (ADB) was established in the year 1966, with head office at Manila (Philippines). It has 67 members from the Asia Pacific region. This bank was modeled on the lines of the world bank.
2. Japan holds the largest share in ADB with 15.677%, followed by U.S.A (15.567%), China (6.473%), and India (5.812%).
3. The aim of the ADB is social development by reducing poverty in the Asia Pacific with inclusive growth, sustainable growth, and regional integration. This is carried out through an 80% investment in the public sector.
4. ADB invests in infrastructure, health, public administration system, helping nations to reduce the impact of climate change and to manage natural resources.

Asian Development Bank (ADB) & India – Facts for IAS Exam

India started availing of ADB’s assistance in 1986. The aim is of Asian Development Bank is to support India in the following fields:

• Industrial competitiveness
• Jobs creation
• Growth acceleration of low-income states
• Environmental and climate change challenges

There are six sectors in India where we can see ADB’s presence:

• Transport
• Energy
• Water and urban services
• Finance and public sector management
• Agriculture and natural resources, and
• Human development

The projects in India spanning 25 states where ADB has assisted/is assisting are:

• Railways and mass rapid transit system
• Renewable energy and energy efficiency
• Coastal protection
• Riverbank strengthening & river basin management
• Urban environmental management, including water management, sanitation, and sewerage and solid waste management.

Recent development between ADB & India:

• ADB and India have signed a loan of $206 million to strengthen urban services in 5 Tamil Nadu cities
• Asian Development Bank (ADB) has listed its 10-year masala bonds worth Rs 850 crore on the global debt listing platform of India INX
• Asian Development Bank (ADB) had prepared a Conceptual Development Plan (CDP) for Vizag-Chennai Industrial Corridor (VCIC)
• ADB has offered to provide USD 4 million to member countries to contain coronavirus outbreaks.
• The Asian Development Bank (ADB) will provide Rs 100 crore loan to hospital chain Medanta for healthcare services and medical equipment to fight the COVID-19 pandemic. The project will support the purchase of personal protective equipment, basic hygiene products, and patient care equipment such as ventilators and beds.

Asian Development Bank & Covid-19

• As a response to COVID-19, the World Bank Group and the Asian Development Bank is coordinating more than $15.4 billion in wide-ranging lending programs in South Asia.

Asian Development Bank (ADB) on Governance – UPSC Exam

A policy paper titled, “Governance: Sound Development Management” was outlined in October 1995.  ADB defined governance as, ‘the manner in which power is exercised in the management of a country’s economic and social resources for development’.

ADB gave two dimensions to governance:

1. Political – Democracy, Human Rights
2. Economic – Efficient management of public resources

ADB has identified four basic elements of good governance:

• Accountability
  (i) Public officials should be answerable for government behaviour and responsive to the entity from which they derive authority.
  (ii) The accountability of public sector institutions is facilitated by an evaluation of their economic performance.
  (iii) The suggested specific areas of action would be in the building of government capacity through, for example, public-sector management, public-enterprise management and reform, public financial management, and civil-service reform.
• Participation
  (i) Government structures should be flexible enough to offer beneficiaries and others affected the opportunity to improve the design and implementation of public programmes and projects.
  (ii) The specific areas of action would be in the development of participatory development processes through, for example, the participation of beneficiaries, a public/private-sector interface, decentralization/empowerment of local government, and cooperation with non-governmental organizations (NGOs).
• Predictability
  (i) Laws and policies should exist that regulate society and that are applied fairly and consistently.
  (ii) Predictability requires the state and its subsidiary agencies to be bound by and answerable to the legal system in the same way as private enterprises and individuals.
  (iii) The specific area of action could be the development of predictable legal frameworks for private-sector development.
• Transparency
  (i) Information should be made available to the general public and there should be clarity as to rules and regulations.
  (ii) Access to timely information on the economy can be vital to economic decision-making by the private sector and can also serve to inhibit corruption.

All the above elements are interlinked and mutually supportive and reinforcing. Accountability is often related to participation and is also the ultimate safeguard of predictability. Transparency and predictability in the functioning of a legal framework would serve to ensure the accountability of public institutions.

Production Linked Incentive Scheme for the Food Processing Industry

Context:

The Ministry of Food Processing Industries issued guidelines for ‘Production Linked Incentive Scheme for the Food Processing Industry.

Background:

• As part of the government’s announcement of Atmanirbhar Bharat Abhiyan, a central sector scheme ‘Production Linked Incentive (PLI) Scheme for Food Processing Industry’ was approved for implementation during 2021-22 to 2026-27.
• The chief objective of the scheme is to support the creation of global food manufacturing champions commensurate with India’s natural resource endowment and support Indian brands of food products in the international markets.

Production Linked Incentive (PLI) Scheme

Production Linked Incentive or PLI scheme is a scheme that aims to give companies incentives on incremental sales from products manufactured in domestic units. The scheme invites foreign companies to set up units in India, however, it also aims to encourage local companies to set up or expand existing manufacturing units and also to generate more employment and cut down the country’s reliance on imports from other countries.
It was launched in April 2020, for the Large Scale Electronics Manufacturing sector, but later towards the end of 2020 was introduced for 10 other sectors. This scheme was introduced in line with India’s Atmanirbhar Bharat campaign. 

PLI Scheme – A Brief Background

• It was introduced as a part of the National Policy on Electronics by the IT Ministry to give incentives of 4-6% to electronic companies, manufacturing electronic components like mobile phones, transistors, diodes, etc.
• The main aim of this scheme was to invite foreign investors to set up their manufacturing units in India and also promote the local manufacturers to expand their units and generate employment
• The first sector which the PLI scheme had targeted was the Large Scale Electronics Manufacturing in April 2020, and by the end of the year (November 2020), 10 more sectors including food processing, telecom, electronics, textiles, speciality steel, automobiles and auto components, solar photovoltaic modules and white goods such as air conditioners and LEDs were also expanded under the PLI scheme
• As far as the eligibility is concerned, all electronic manufacturing companies which are either Indian or have a registered unit in India will be eligible to apply for the scheme
• In the Union Budget 2021, Finance Minister Nirmala Sitharaman mentioned the inclusion of thirteen more sectors under the PLI Scheme for a period of five years and Rs. 1.97 lakh crores have been allocated for this scheme from Financial Year 2022

Expansion of Production Linked Incentive Scheme

The Union Cabinet chaired by Prime Minister Narendra Modi, on November 11, 2020, approved the introduction of the PLI scheme for the 10 key sectors which can enhance India’s Manufacturing Capabilities and improve exports.  
Given below are the 10 new sectors to which the scheme has been expanded along with the approved financial outlay:

Based on the ten sectors to which the Production Linked Incentive scheme was expanded to, the government aims at achieving the following targets:

• The government aims to make India an integral part of the global supply chain and enhance exports
• India is expected to have a USD 1 trillion digital economy by 2025 as it expects the demand for electronics to increase under its projects like Smart City and Digital India
• The PLI scheme will make the Indian automotive Industry more competitive and will enhance the globalisation of the Indian automotive sector
• The Indian Textile Industry is one of the largest in the world and with this scheme, it shall attract large investment in the sector to further boost domestic manufacturing, especially in the manmade fibre (MMF) segment and technical textiles
• India, being the second-largest producer of steel in the world, introducing it under the PLI scheme will benefit the country as it may expand export opportunities
• Similarly, telecom, solar panels, pharmaceuticals, white goods, and all the other sectors introduced can contribute to the economic growth of the country and make India a manufacturing hub globally

Production Linked Incentive Scheme for Large Scale Electronics Manufacturing

• The first phase of the PLI scheme was dedicated to the Large Scale Electronics Manufacturing sector and the scheme proposed to increase the manufacturing of mobile phones in India along with setting up their Assembly, Testing, Marking and Packaging (ATMP) units
• The total cost proposed for the scheme was INR 40,995 crore
• It was set up to benefit a few global investors and mainly the domestic manufacturers in India
• With high potential for employment generation, the scheme can help employee over 2 lakh people in 5 years in the electronics manufacturing sector
• Till date, in the case of electronics, the assembling of objects was done in India, while the production was done outside. With the PLI scheme and Make in India campaign, the electronics can be made ad assembled in the domestic industries itself
• The production of mobile phones in the country has gone up significantly from around INR 18,900 crore in 2014-15 to INR 1,70,000 crore in 2018-19 and the domestic demand is almost completely being met out of domestic production. With PLI, this can be increased even further

The table given below shows the financial outlay as per the first phase of the Production Linked Incentive (PLI) Scheme:

Production Linked Incentive Scheme for Pharmaceuticals

• PLI scheme for Pharmaceuticals was introduced for a period of five years between FY 2020-21 to 2028-29. Total incremental sales of Rs.2,94,000 crore and total incremental exports of Rs.1,96,000 crore are estimated during six years from 2022-23 to 2027-28
• The scheme is expected to generate employment for both skilled and unskilled personnel, estimated at 20,000 direct and 80,000 indirect jobs as a result of growth in the sector
• The duration of the scheme will be from FY 2020-21 to FY 2028-29. This will include the period for processing of applications (FY 2020-21), an optional gestation period of one year (FY 2021-22), an incentive for 6 years and FY 2028-29 for disbursal of incentive for sales of FY 2027-28

What’s New?

• Along with the operational guidelines, the ministry also unveiled an online portal for the PLI Scheme for Food Processing Industry (PPLISFPI).