Weekly Current Affairs (8th to 14th November 2024) Part - 1 | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

GS1/History & Culture

American Civil War (1861-1865)

Why in News?

• Recently, the Republican Party's presidential candidate won the election, defeating the Democratic Party's candidate. The US Civil War was largely influenced by tensions surrounding slavery, economic disparities, and states' rights, with one side opposing slavery and the other initially supporting it.

How did Slavery Evolve Through Human History?

Origins & Early Development:Slavery began thousands of years ago alongside agricultural settlements, where victorious tribes enslaved defeated groups instead of killing them. Ancient civilizations like Mesopotamia, Egypt, Greece, and Rome developed intricate slave-based economies. Various forms of slavery appeared, such as:

• Debt bondage
• Enslavement of conquered peoples
• Child labor
• Generational bondage

Global Expansion & Trade: 

• The Arab slave trade dominated the Indian Ocean from the 7th to 19th centuries, linking Africa, the Middle East, and Asia. The trans-Saharan slave trade forcibly transported millions from Sub-Saharan Africa to North Africa. The transatlantic slave trade, beginning in the 16th century, moved around 12 million Africans to various parts of the world, with European colonial powers creating systematic slave trading networks across continents.

Slavery in India: 

• Early texts like the Arthashastra and Manusmriti recognized and regulated slavery. Buddhist and Jain scriptures also acknowledged slavery but promoted compassionate treatment. Islamic rulers introduced systems of military slavery and domestic servitude. The Mughal era saw extensive slave trading networks in South Asia. The Girmitiya system, a form of indentured labor, was established in British colonies to address labor shortages after the abolition of slavery in 1833. The Indian Slavery Act of 1843 formally abolished slavery under British rule. Post-independence, India prohibited bonded labor through Article 23 of the Constitution and later through the Bonded Labour System (Abolition) Act of 1976.

What were the Causes and Course of the US Civil War?

Causes of the US Civil War:

• Slavery and Sectional Divides: The conflict primarily stemmed from differences between the northern and southern states. The North had a diverse economy based on both industry and agriculture, relying on free labor, whereas the South was heavily dependent on slave labor for its agricultural economy, especially cotton. This economic divergence led to significant disagreements over slavery, with many Northerners advocating for its prohibition in new western territories, while Southerners sought laws to protect it. As the US expanded westward, the slavery issue became increasingly contentious, particularly for northern states that feared allowing slavery in new territories would enhance the South's political power in Congress. This growing divide fueled political tensions and led southern states to pursue secession from the Union. Additionally, debates about states' rights versus federal authority emerged, with Southern leaders claiming states had the right to secede, while most others argued that the Union was permanent under the Constitution.
• Ideological Divide Between North vs. South: The ideological differences were stark, with the North promoting a diversified economy and free labor, while the South's economy relied on slave labor. The conflict transcended slavery, encompassing broader democratic principles as both sides aimed to shape the nation's future in alignment with their values and lifestyles.

Course of the Civil War:

• Anti-Slavery Protest: The Kansas-Nebraska Act of 1854 allowed settlers in Kansas and Nebraska to decide on the legality of slavery through popular sovereignty, escalating sectional tensions. In response, anti-slavery activists organized to form the Republican Party, with significant figures like Abraham Lincoln among the early members.
• Secession and Outbreak of War: The conflict peaked in 1860 with Lincoln's election, prompting southern states to secede and form the Confederate States of America. The war officially began when Confederate forces attacked Fort Sumter in South Carolina in April 1861. Lincoln ordered the army to restore the Union. Despite the South's superior military leadership, the North's larger population and industrial capacity ultimately led to the South's surrender in April 1865.
• Emancipation Proclamation: In 1863, Lincoln issued the Emancipation Proclamation, declaring all slaves in Confederate states to be free. This declaration had international implications, discouraging European nations from supporting the Confederacy. Nevertheless, Lincoln emphasized that the war's purpose was to preserve the Union, not specifically to abolish slavery.
• Thirteenth Amendment and Abolition of Slavery: Following the war, the 13th Amendment to the US Constitution was ratified in 1865, formally abolishing slavery.

What were the Challenges and Impacts of the US Civil War?

Reconstruction and Post-War Challenges in the US:

• Reconstruction and Southern Resistance: The Reconstruction era (1865-1877) aimed to reintegrate Southern states and enforce civil rights for African Americans. The 14th and 15th Amendments granted citizenship and voting rights to African Americans, significantly transforming the social and political landscape of the US.
• Economic Changes and Industrialisation: The Civil War accelerated industrialization in the US, establishing it as a leading industrial power by 1914, partly due to the demands for mass production during the conflict. Immigration significantly contributed to this industrial growth, with nearly 20 million newcomers arriving between 1870 and 1914. The expansion of the railroad system, especially the completion of the Transcontinental Railroad in 1869, facilitated trade and industrial development, linking the eastern US with the West and promoting goods movement.
• Postwar Economic Expansion: The war stimulated railroad growth, connecting agricultural regions to industrial hubs. Steel became vital as railways expanded, and the transport of agricultural products such as corn, wheat, and cattle positioned the US as a global leader in agriculture and industry by the 20th century.

Global Impact on the Cotton Trade and its Influence on India:

• Disruption of Cotton Exports: The Civil War disrupted the global cotton trade, as the South, a primary cotton supplier to Britain, could no longer export. British textile manufacturers sought alternative sources, significantly increasing demand for cotton from India.
• The Cotton Boom in India: Consequently, India emerged as a critical cotton supplier to British industries during the war. This demand led Indian merchants to encourage farmers in regions like Gujarat and Maharashtra to cultivate more cotton, resulting in an economic boom, albeit often at the expense of local farmers.
• Long-Term Economic Consequences for India: While India benefitted from increased cotton exports, the profits primarily went to British industries. This cotton boom also caused food shortages in some areas as farmers shifted to cotton cultivation over food crops, leading to famines and economic distress among Indian farmers. The British colonial system continued to extract wealth from India, leaving its farmers in debt and poverty.

Mains Question:

• How was the cotton trade from India impacted during the US Civil War, and what were the long-term consequences for Indian farmers?

GS3/Environment

Protected Planet Report 2024

• The 2024 Protected Planet Report, created by the UNEP-World Conservation Monitoring Centre (UNEP-WCMC) and the IUCN along with its World Commission on Protected Areas (WCPA), serves as the first comprehensive assessment of the global state of protected and conserved areas. It outlines both achievements and ongoing challenges in relation to Target 3 of the Kunming-Montreal Global Biodiversity Framework (KM-GBF).

Target 3 aims to ensure that by 2030, at least 30% of terrestrial, inland water, coastal, and marine regions, particularly those vital for biodiversity, are effectively conserved and managed through ecologically representative and equitably governed protected areas.

This goal emphasizes the importance of recognizing indigenous and traditional territories, integrating them into broader landscapes and seascapes, and ensuring that sustainable use aligns with conservation efforts while respecting the rights of Indigenous peoples and local communities.

What are the Key Highlights of the Protected Planet Report 2024?

Global Coverage Progress:

• Currently, 17.6% of land and inland waters, and 8.4% of oceans and coastal areas are protected.
• Progress has been limited, with an increase of less than 0.5% in both sectors since 2020.
• To achieve the 30% target by 2030, an additional 12.4% of land and 21.6% of ocean areas must be protected.

Progress in Ocean Conservation:

• Significant advancements since 2020 have occurred in ocean conservation, primarily within national waters.
• However, areas beyond national jurisdiction still have low coverage, with less than 11% of total marine and coastal protected area.

Challenges with Effectiveness and Governance:

• Less than 5% of terrestrial and 1.3% of marine areas have been evaluated for effective management.
• Only 8.5% of protected land areas are well-connected.
• Governance issues persist, with only 0.2% of land and 0.01% of marine areas assessed for equitable management.

Underrepresentation of Biodiversity:

• Only 20% of areas crucial for biodiversity receive full protection, leading to uneven conservation efforts.
• More than two-thirds of Key Biodiversity Areas (KBAs) are partially or fully included in protected sites, yet 32% of KBAs remain entirely unprotected.

Indigenous Peoples' Role:

• Indigenous communities manage less than 4% of protected areas, despite controlling 13.6% of global terrestrial regions outside formal protection.
• Data on governance for these areas is scarce, and the contributions of Indigenous communities are often undervalued.

Key Recommendations:

• Despite existing challenges, 51 countries have already surpassed the 30% target for land, and 31 have done so for marine areas.
• With 6 years remaining to meet the 2030 goal, the report emphasizes that achieving the target is feasible through enhanced efforts, global cooperation, and support for Indigenous peoples.
• Data availability remains a critical issue, particularly regarding biodiversity outcomes from protected areas and equitable governance for local populations.
• It's essential to support Indigenous peoples in managing their lands, valuing their voices and knowledge.
• Efforts should not only target increasing the number of protected areas but also ensure these areas are well-connected and strategically positioned within biodiversity hotspots.

What are the Key Goals of India’s Biodiversity Strategy?

NBSAP:

• The Convention on Biological Diversity (CBD) mandates that member countries, including India, develop a National Biodiversity Strategy and Action Plan (NBSAP) for biodiversity conservation and sustainable use.
• India's NBSAP has been updated to align with the KM-GBF, aiming to protect at least 30% of its natural areas by 2030.
• Originally formulated in 1999, India's NBSAP has undergone updates in 2008 and 2014 to meet the Aichi Biodiversity Targets, showcasing India's commitment to combating biodiversity challenges.

India’s Updated NBSAP:

• The revised NBSAP aspires to safeguard 30% of terrestrial, inland water, coastal, and marine areas, in line with the KM-GBF's international objectives.
• The strategy emphasizes the restoration of ecosystems like forests and rivers to maintain access to essential resources such as clean water and air.

Mains Question:

• Evaluate India’s updated National Biodiversity Strategy and Action Plan (NBSAP) in the context of the Kunming-Montreal Global Biodiversity Framework.

GS2/Polity

Limit on Private Property Acquisition

• Recently, the Supreme Court in the Property Owners Association v State of Maharashtra Case 2024, established limits on the government's authority to acquire privately owned resources for public distribution. The petitioners contended that the state should not seize private properties under the guise of constitutional provisions outlined in Articles 39(b) and 31C of the Constitution.

Key Highlights of the Supreme Court Verdict:

• Acquisition of Private Resources: Resources that are scarce or essential for community welfare should be eligible for state acquisition, rather than all privately owned properties. The concept of the "public trust doctrine" may guide this determination, indicating that the state holds particular resources in trust for the public.
• Tests for Resource Qualification: The court established two primary criteria: a resource must be both "material" and "beneficial to the community." The assessment of materiality and community benefit must occur on a case-by-case basis, taking into account the economic, social, and environmental implications of resources like land, minerals, or water.
• Overturning Ranganath Reddy Case (1977): The majority opinion reversed the Sanjeev Coke ruling (1982), which had previously argued that all private property could be categorized as "material resources of the community" for redistribution. Justice Sudhanshu Dhulia was the lone dissenter, advocating for broader legislative discretion in defining what constitutes "material resources" for the community.
• Restriction on Article 39(b): The court warned against an overly broad interpretation that could undermine property rights protected under Article 300A.
• Private to Community Resources: The Supreme Court identified five methods for transforming private resources into community resources: nationalization, acquisition, operation of law, purchase by the state, and donation by the owner.

Constitutional Provisions Related to Right to Property:

• Article 31: The original Article 31, which dealt with the right to property as a fundamental right, was repealed by the 44th Amendment Act, 1978, and replaced by Article 300A, which provides it as a constitutional right.
• Amendment Act, 1951: This act incorporated Articles 31A and 31B into the Constitution, along with the Ninth Schedule, allowing the state to acquire property or alter property rights without being challenged on the grounds of inconsistency with fundamental rights.
• Article 31A: It allows the state to acquire property or modify property rights without facing challenges based on fundamental rights.
• Article 31B: It ensures that laws included in the Ninth Schedule cannot be invalidated, even if they conflict with fundamental rights, such as land reform laws.
• 25th Amendment Act, 1971: This amendment introduced Article 31C to protect state laws aimed at resource distribution under Articles 39(b) and (c) from constitutional challenges, preventing courts from reviewing state actions, even if arbitrary.
• 42nd Amendment Act, 1976: This expanded the scope of Article 31C to include Directive Principles, shielding qualifying laws from being invalidated under Articles 14 and 19 if they genuinely serve public welfare through resource redistribution.
• Amendment Act, 1978: This amendment abrogated Article 19(1)(f), which protected the right to acquire, hold, and dispose of property, thereby removing the Right to Property from the list of fundamental rights and relegating it to Chapter IV of Part XII.

Significance of the SC Judgment:

• State and Individual Rights: The verdict preserves the potential for state intervention while recognizing that indiscriminate acquisition of private resources is impermissible.
• Economic Democracy: The ruling aligns with Dr. B.R. Ambedkar's vision of economic democracy, ensuring that the Constitution allows flexibility in economic structures, thus preserving people's freedom to determine their social and economic arrangements.
• Flexible Interpretation: It emphasizes that Directive Principles, such as Article 39(b), should be implemented in a manner that reflects evolving societal and economic realities rather than adhering to a rigid economic doctrine.
• Legislative Framework: The judgement reinforces the role of elected governments and the democratic process in formulating economic and welfare policies.
• Welfare: Future welfare policies are likely to focus on scarce, critical resources essential for public welfare, with the state potentially adopting more targeted welfare strategies, such as progressive taxation and public schemes.

Conclusion

The Supreme Court's ruling in the Property Owners Association v. State of Maharashtra (2024) sets important precedents concerning the state's power to acquire resources. It highlights the necessity for public purpose, compensation, and case-by-case assessments, balancing individual property rights with the common good.

Mains Question:

• Discuss judicial interpretation of the right to property in various landmark cases.

GS3/Environment

Climate Change Impact on Small Island Developing States

Why in News?

• At UNFCCC COP27 (2022) in Sharm El Sheikh, a new loss and damage fund was established to assist climate-vulnerable nations, especially Small Island Developing States (SIDS). However, despite this agreement, wealthier nations, which are the largest carbon emitters, have not met their financial commitments, leaving many vulnerable countries without essential support.

How is Climate Change Affecting SIDS?

Increased Vulnerability of SIDS:

• SIDS experience climate-related losses that are 3-5 times greater compared to their government revenues, in contrast to other nations.
• Even relatively affluent SIDS like Barbados and the Bahamas encounter losses that are four times greater than those of other high-income countries.
• Under a 2°C warming scenario, projected losses from extreme weather could reach USD 75 billion annually by 2050 for SIDS.

Direct Impacts:

• Extreme weather events induced by climate change wreak havoc on homes, infrastructure, and public services, leading to significant loss of life.
• For example, Cyclone Winston in 2016 caused severe flooding in Fiji, claiming 44 lives and resulting in major economic disruptions.

Indirect Impacts:

• Recovery costs and resource diversion slow economic recovery, significantly impacting crucial sectors like tourism and agriculture.
• For instance, the GDP growth of Fiji was curtailed by 1.4% due to the aftermath of the 2016 cyclone.
• Prolonged fiscal challenges arise as nations grapple with recovery costs that worsen national debt, exemplified by Dominica's recovery from Hurricane Maria, leaving it with a debt-to-GDP ratio of 150%.

Cost of Climate Change:

• From 2000 to 2020, direct and indirect impacts on SIDS amounted to USD 141 billion, averaging USD 2,000 per person.
• Some nations have faced even steeper costs, with per capita losses reaching USD 20,000 in certain instances.
• Studies indicate that 38% of total losses can be attributed to climate change through extreme event attribution studies.

Why do Developed Countries Need to Pay Up?

• Financial Responsibility: Wealthy industrialized nations, as the largest historical carbon emitters, hold the main responsibility for financing climate change mitigation and adaptation efforts in vulnerable countries.
• Insufficient Current Funding: The existing financial pledges fall short of addressing the magnitude of loss and damage already being experienced, making it inadequate for preparing for future impacts.

Urgency for a Marshall Plan-Scale Response:

• Considering the grave impacts, the fund must be structured with the scale and ambition reminiscent of a "modern Marshall Plan", ensuring that affected nations have adequate resources for recovery and adaptation.
• This refers to a US-led initiative post-World War II that offered extensive economic aid to rebuild Western Europe, fostering political stability and long-term growth.

Effective Fund Utilization:

• The fund should provide budget support mechanisms, ensure quick disbursement for timely recovery, and offer concessional financing to prevent increasing debt burdens.

Failure to Meet Climate Commitments: Developed countries have a track record of not meeting climate finance targets and emissions reduction commitments, even though they are responsible for less than 1% of global greenhouse gas emissions but are among those most affected by climate change.

Induced Economic Loss (IELD) and the FRLD:

• Indirect economic losses from extreme weather events may have reached USD 107 billion from 2000 to 2022, with 36% attributed to climate change.
• The Fund for Responding to Loss and Damage (FRLD) aims to offer financial support to vulnerable nations, particularly developing countries, to counter climate change impacts and should also focus on these indirect losses to ensure swift recovery.

Growing Fiscal Stress: The cumulative losses from both direct and indirect impacts could reach USD 75.2 billion annually by 2050 under a 2°C warming scenario. Developed nations must enhance their financial contributions to ensure that funds are accessible for both immediate impacts and long-term economic challenges faced by SIDS.

Conclusion

The creation of the loss and damage fund at UNFCCC COP27 represents a crucial advancement in supporting vulnerable nations. Wealthy countries must meet their obligations to provide adequate resources for climate resilience, addressing the challenges these nations face and ensuring their sustainable development.

Mains Question:

• What are the key financial challenges faced by Small Island Developing States (SIDS) in responding to climate change? Discuss the role of international financing in supporting these countries.

GS2/Polity

SC Orders Re-evaluation of AMU’s Minority Status

• Recently, a Supreme Court bench of seven judges (by a 4:3 majority) addressed the minority status of Aligarh Muslim University (AMU) by overruling the 1967 ruling in the case of S. Azeez Basha vs. Union Of India, which stated that an institution established by statute cannot claim minority status. The determination of whether AMU qualifies as a minority institution under Article 30 of the Constitution is now to be resolved by a regular bench based on this majority view.

Major Highlights of the Supreme Court Judgement

Main Aspects of the Case Considered by the Court:

• Whether AMU, which was established and governed by the AMU Act 1920, can claim minority status.
• The validity of the 1967 Supreme Court ruling that denied AMU minority status.
• The implications of the 1981 amendment to the AMU Act, which granted minority status after the S. Azeez Basha case.
• The correctness of the 2006 Allahabad High Court ruling in AMU v. Malay Shukla that deemed AMU as a non-minority institution, affecting its ability to reserve seats for Muslim candidates in Medical PG Courses.

Key Highlights of the Recent Ruling:

• The Supreme Court has overturned the Azeez Basha judgment, which previously ruled that AMU was not a minority institution.
• The court did not make a direct decision on AMU's minority status, instead deferring the matter to a regular bench to investigate AMU's historical context.

New Test for Determining Minority Status:

• Establishment: The origins and purpose behind the establishment of the institution.
• Implementation: Investigation into funding sources, land acquisition, and permissions for the institution's construction.
• Administration: Examination of the administrative framework to see if it supports minority interests. Lack of such support could imply that the educational institution was not primarily established for the minority community.

Minority Character of an Institution:

• The court asserted that an institution should not be denied minority status solely because it was created by statute; a strict interpretation of legislative language should not govern the determination of minority status.
• The interpretation of "established" in Article 30(1) should not be overly restrictive; it must align with the objectives of the article.
• Article 30(1) guarantees rights to minorities as defined at the Constitution's commencement.

Core Essentials of Minority Character:

• Establishing a minority institution often aims to preserve cultural and linguistic heritage, but this need not be the sole aim.
• Minority institutions can admit non-minority students without losing their minority status.
• Secular education can coexist alongside minority status.
• Government-funded institutions cannot mandate religious instruction if fully funded by the state, yet they retain their minority status.

Nature of Incorporation vs Establishment:

• The judgment clarified that incorporation through legislation does not negate minority status.
• The original establishment of the university predates its formal incorporation.
• The court dismissed the notion that Muslims were not a minority in 1920; it stated that pre-Constitution institutions are also protected under Article 30.
• The terms "incorporation" and "establishment" are not interchangeable; AMU's incorporation by law does not undermine its founding by a minority group.

Dissenting Opinion:

• Three judges dissented from the majority opinion, presenting differing views on the applicability of Article 30 to institutions established by statute.

What is the Timeline of the AMU Dispute?

Conclusion

The Supreme Court's recent decision to reevaluate AMU's minority status underscores the ongoing debate surrounding Article 30, which protects minorities' rights to establish educational institutions. By overturning the 1967 Azeez Basha judgment, the court has potentially paved the way for AMU to reclaim its minority status, with significant implications for minority educational rights in India.

Mains Question:

• Discuss the implications of the Supreme Court's recent decision to review Aligarh Muslim University’s minority status on India's constitutional framework for minority rights.

GS3/Economy

Development Economics

Why in News?

• The recent October 2024 edition of the IMF World Economic Outlook has ignited discussions about the necessity for development economics to reconcile political and economic realities. The report underlines the significance of an integrated approach to tackle global economic issues, emphasizing the need to comprehend the relationship between economic policies and political consequences for effective governance.

What is Development Economics?

• Overview: Development economics is a field dedicated to understanding how nations can attain sustainable economic growth, alleviate poverty, and enhance the overall quality of life of their citizens. It investigates the mechanisms of economic development, the factors driving it, and the obstacles that developing countries encounter.
• Historical Context: This discipline emerged in the aftermath of World War II, particularly addressing the challenges faced by newly independent states.

Key Focus Areas:

• Economic Growth: It explores the dynamics of economic expansion and diversification, focusing on elements such as investment, technological advancement, human capital development, infrastructure improvements, and institutional frameworks that drive sustained progress.
• Poverty Reduction: This area aims to diminish poverty through approaches like wealth redistribution, social welfare initiatives, and inclusive economic policies to enhance living conditions.
• Inequality: Development economics scrutinizes income and wealth disparities within and among nations, considering how inequality impacts social unity and economic stability, as well as strategies to mitigate it through policy interventions.
• Sustainable Development: This aspect integrates environmental sustainability into economic growth, addressing issues like climate change and resource depletion.
• Globalisation and Trade: It analyzes the influence of international trade, foreign direct investment, and global financial systems on developing nations, focusing on challenges such as trade imbalances and access to markets.
• Institutional Development: The importance of robust institutions (like legal systems and democratic governance) is emphasized, examining how these frameworks influence economic outcomes and the ways to enhance them.

Theoretical Approaches:

• Neoclassical Theory: This perspective advocates for free markets, private property rights, and competition as key drivers of economic growth, promoting minimal government involvement.
• Structuralist Theory: It highlights the necessity to address systemic issues such as inadequate infrastructure and over-dependence on primary sectors, advocating for state-led development initiatives.
• Capability Approach: Introduced by Amartya Sen, this viewpoint shifts the emphasis from GDP to human well-being, stressing the importance of enhancing individual freedoms and choices in the development process.
• Institutional Economics: This approach focuses on the significant role that both formal and informal institutions play in shaping economic outcomes, contending that development is largely influenced by governance quality and societal norms.

Why is there Need to Reevaluate the Current Approach to Development Economics?

• Macro-Level Challenges: There is often an excessive focus on micro-level solutions, neglecting broader macroeconomic issues such as national competitiveness and global trade deficits. A more inclusive approach is essential to tackle these large-scale economic challenges.
• Political Realities: In democracies like India, political dynamics, including populist policies, can hinder long-term structural reforms. Solutions must align with political viability to ensure practical implementation within existing frameworks.
• Global Dynamics and Technological Shifts: With rapid technological changes and disruptions in global markets, development economics must evolve to address these transformations, including competitiveness and innovation impacts on national growth.
• Sustainable and Inclusive Growth: Reevaluation is necessary to ensure that development economics promotes inclusive growth and addresses environmental challenges stemming from rapid industrialization and urbanization.
• Interdisciplinary Approach: There is a need to incorporate insights from various fields like political science, sociology, and environmental studies to create a comprehensive framework that acknowledges the complex interconnections between economic policies, political stability, and social welfare.

How does India's Economic Performance Align with Global Development Economics?

• High Growth Rate: India’s GDP growth consistently surpasses the global average, with a projected growth rate of 7% for 2024-25, showcasing its status as a prominent emerging market economy.
• Domestic Demand as Growth Driver: A significant portion of India's economic growth stems from strong domestic consumption, with consumer spending making up about 60% of GDP. Government investments in infrastructure and social welfare are crucial for cushioning against external economic shocks.
• Demographic Dividend: With a median age of 28.4 years in 2024, India boasts a young population, providing a potential workforce that can significantly enhance productivity. By 2030, India is expected to have the largest workforce globally.
• Service Sector Dominance: India’s economy is bolstered by the services sector, particularly through IT and Business Process Outsourcing (BPO), contributing significantly to exports and generating employment opportunities. IT exports reached approximately USD 194 billion in FY 2023.
• Infrastructure Development: The government has committed USD 1.5 trillion for infrastructure enhancement, with initiatives like the Bharatmala project and UDAN aimed at creating economic opportunities and boosting competitiveness.
• Digital Transformation and Financial Inclusion: India has made notable progress in digital payment systems, with UPI transactions witnessing substantial growth, enhancing financial inclusion for previously underserved populations.

What are the Challenges in Development Economics for India?

• Political Economy Constraints: India's development is often influenced by political cycles that favor short-term populist measures over critical long-term reforms needed for sustainable growth.
• Labour Market Rigidities: Skill deficits and rigid labor laws hamper India's ability to adapt its workforce to high-growth sectors, restricting overall economic agility.
• Social Unrest and Protests: Tensions between labor and business in manufacturing sectors pose social challenges that can deter investment if not addressed effectively.
• Geopolitical Uncertainties: Trade tensions, particularly between major economies like the US and China, present both opportunities and threats for India, necessitating diversification of trade partnerships.

Way Forward

• Balancing Growth and Equity: It is crucial to implement reforms that promote not only economic growth but also address income inequality and ensure social justice.
• Fostering Technological Adoption: India must leverage technological advancements, including AI and renewable energy, to enhance competitiveness, supported by a conducive policy environment.
• Boosting Labour-Intensive Sectors: Concentrating on sectors like textiles and garments, where India holds a competitive edge, is vital for economic growth.
• Advancing Technological Innovation: Investment in emerging industries and STEM education is necessary to enhance India's position in global value chains.
• Reforming Labour Laws and Regulatory Frameworks: Simplifying labor laws and regulatory processes will create a more favorable business environment, attracting foreign investment.
• Targeting Investment in Human Capital: Prioritizing education and skill development will enhance labor productivity and align the workforce with high-value sectors.
• Engaging with International Institutions: Strengthening ties with global organizations like the IMF and World Bank will help India navigate international trade dynamics and secure favorable conditions.

Mains Question:

• What is Development Economics? Why is there a need to Reevaluate the current approach of development economics?

GS3/Environment

Upgrading Wind Energy Generation

Why in news?

• In August 2024, the Tamil Nadu government introduced the “Repowering, Refurbishment, and Life Extension Policy” to replace old turbines and optimize wind energy use. However, this policy has faced opposition from wind energy generators, who have approached the Madras High Court and secured a stay on its implementation.

What is Tamil Nadu Repowering, Refurbishment & Life Extension Policy for Wind Power Projects, 2024?

• Context: Wind energy generators operating windmills older than 20 years are in need of upgrades to enhance energy efficiency.
• Policy Focus:The policy encompasses three main initiatives:
  • Extending the operational lifespan of windmills that are over 20 years old.
  • Replacing outdated windmills with modern machines.
  • Upgrading or repairing existing old windmills.
• Capacity Overview: Approximately 300 MW out of the total 9,000 MW wind energy capacity in Tamil Nadu comprises windmills that are over 20 years old.
• Reason for Opposition: Wind energy generators are required to pay Rs 30 lakhs per MW every five years for life extension. A one-time payment is needed for repowering to replace old machines.

What are the Key Facts About Wind Energy in India?

• Wind Energy Potential: India possesses a wind power potential of 1,163.86 GW at 150 meters above ground level, and 695.51 GW potential at a height of 120 meters for turbines.
• Wind Energy Utilisation: Currently, only about 6.5% of India’s wind energy potential is utilized at the national level, with nearly 15% utilization in Tamil Nadu.
• Wind Power Generation: India ranks fourth in the world in terms of wind power capacity and stands fourth in overall renewable energy installed capacity as of now.
• Cost Competitive: It is projected that power generation from wind projects will become cost-competitive compared to thermal power generation in India by 2025-2030.

Wind Turbine Maintenance

• Repowering: This involves replacing wind turbines that are older than 15 years or have a capacity of under 2 MW.
• Refurbishing: Upgrading turbines by increasing their height, changing blades, or installing higher-capacity gearboxes to enhance energy output.
• Life Extension: Implementing safety measures to prolong the lifespan of older turbines.
• Windy States: Major states contributing to wind energy include Gujarat, Tamil Nadu, Karnataka, Maharashtra, Rajasthan, and Andhra Pradesh, which together account for 93.37% of the country’s installed wind energy capacity. Tamil Nadu has the second-largest installed capacity with 10,603.5 MW, following Gujarat.

What are the Challenges in Repowering and Refurbishing Wind Turbines?

• Land Requirements: New turbines, particularly those with higher capacities (2 MW and 2.5 MW), necessitate more land (3.5 to 5 acres) compared to older turbines.
• Displacement: Since the installation of turbines in the 1980s, new habitats have emerged around wind sites, creating challenges related to displacement and rehabilitation of local populations.
• Technology Evolution: Upgrading turbines, blades, and gearboxes to match technological advancements requires substantial investment, time, and expertise.
• Banking Issue: Wind turbines installed after 2018 lack banking facilities, meaning that repowered turbines are treated as new installations, which prevents generators from banking the energy produced, adversely affecting financial viability.

Way Forward

• Improved Tariff Mechanism: Implementing competitive renewable tariffs will help stabilize pricing and diminish financial risks for project developers.
• Completion Deadlines: Enforcing strict adherence to project completion deadlines will minimize delays, enhance project efficiencies, and bolster the credibility of the wind energy sector.
• Integration with Solar Energy: Improving solar-wind grid integration is essential to harness energy when solar generation is low, such as during nighttime.
• Transmission Infrastructure: Investments in advanced energy storage systems and upgrades to transmission infrastructure will maximize the efficiency of wind energy.
• Long-Term Power Purchase Agreements (PPAs): Securing long-term PPAs with distribution companies will provide a reliable revenue stream for developers and increase interest in wind energy projects.
• Technology Upgradation: Innovations like larger and more efficient turbines, offshore wind technology, and hybrid systems could significantly enhance India’s wind energy capacity.

Mains Question:

• India ranks fourth globally in wind energy capacity but uses only a small fraction of its potential. What solutions are needed to overcome challenges in the sector?

GS3/Economy

State of Food and Agriculture 2024

• The report by the Food and Agriculture Organization (FAO) of the United Nations has uncovered alarming global hidden costs associated with agrifood systems, totaling around USD 12 trillion each year. These costs are primarily driven by unhealthy dietary habits and environmental degradation. The report highlights the often-ignored factors contributing to these costs and emphasizes the urgent need for a transformation in global agrifood systems.

Key Highlights of the State of Food and Agriculture 2024

• Global Hidden Costs: The hidden costs related to agrifood systems are approximately USD 12 trillion annually.
• Of these costs, 70% (about USD 8.1 trillion) are associated with unhealthy dietary choices and the resulting non-communicable diseases (NCDs), such as heart disease, stroke, and diabetes.
• Insights on India: India's hidden costs amount to USD 1.3 trillion, ranking as the third highest globally, following China (USD 1.8 trillion) and the USA (USD 1.4 trillion).
• More than 73% of these costs in India are attributed to dietary risks, including:
  • High consumption of processed foods.
  • Low intake of plant-based foods.
• The excessive consumption of processed foods and additives incurs an annual cost of USD 128 billion, primarily due to diseases like heart disease, stroke, and diabetes.
• Insufficient consumption of plant-based foods and healthy fatty acids contributes an additional USD 846 billion to hidden costs, further straining healthcare systems.
• Low wages and productivity among agrifood workers, compounded by systemic distribution failures, contribute to poverty in India.

Hidden Costs by Agrifood System Types

• The report categorizes agrifood systems into six types: protracted crisis, traditional, expanding, diversifying, formalising, and industrial, each exhibiting unique hidden cost profiles.
• In most systems, a low intake of whole grains, fruits, and vegetables is the primary dietary risk.
• In systems affected by protracted crises and traditional methods, low consumption of fruits and vegetables is particularly concerning.
• There is an increase in sodium intake as systems transition from traditional to formalising, peaking in formalising systems before declining in industrial systems.
• Consumption of processed and red meats rises steadily in more industrialized agrifood systems.

Environmental and Social Costs
There are significant environmental costs stemming from unsustainable agricultural practices, especially in diversifying agrifood systems, which include:

• Greenhouse gas emissions.
• Nitrogen runoff.

Countries experiencing prolonged crises face substantial environmental costs, which can reach up to 20% of their Gross Domestic Product (GDP).

Traditional and protracted crisis systems bear the highest social costs, with undernourishment representing a significant GDP portion in these areas (ranging from 8% to 18%).

Recommendations for Transformative Change

• True Cost Accounting: Implementing true cost accounting is essential to accurately capture hidden costs and enhance decision-making.
• Healthier Diets: Policies should be enacted to make nutritious food more affordable and accessible, thereby reducing health-related hidden costs.
• Sustainability Incentives: Financial and regulatory incentives are needed to encourage sustainable practices and lower emissions.
• Consumer Empowerment: Providing clear and accessible information regarding the environmental, social, and health impacts of food choices can guide consumer behavior.
• Importance of Collective Action: There is a need for cooperation among agribusinesses, governments, financial institutions, international organizations, and consumers to foster systemic change.
• Focus on SDGs: Transforming global agrifood systems is vital for achieving the Sustainable Development Goals (SDGs) and ensuring food security, nutrition, and sustainable development.

How is India Working Towards Sustainable Food Systems?

According to FAO, a sustainable food system (SFS) balances economic profitability, social equity, and environmental protection to ensure food security for future generations.

National Food Security Act (NFSA) of 2013: This act provides food entitlements to over 800 million citizens, showcasing India’s commitment to ensuring food security.

India’s Initiatives for SFS:

• National Mission for Sustainable Agriculture (NMSA).
• Fortified Rice Distribution (2024-2028).
• Rashtriya Krishi Vikas Yojana (RKVY).
• Eat Right Initiative.
• Digital Agriculture Mission (DAM).

What are India’s Challenges in SFS?

• Climate Change: India has been experiencing increasingly erratic weather patterns, including droughts, floods, and heatwaves, which adversely affect crop yields and food security.
• Environmental Degradation:The excessive use of chemical fertilizers and pesticides contributes to soil degradation, water pollution, and biodiversity loss, with key concerns including:
  • Declining yields.
  • Soil fertility issues.
  • Decreased soil organic carbon (SOC) levels.
  • Water scarcity.
• Inconsistent Ingredient Limits: There is a disparity between Indian standards and those set by the World Health Organization (WHO) regarding limits for ingredients like sugar and salt in processed foods, complicating nutritional regulation and public health initiatives aimed at reducing diet-related diseases.
• Sanitary and Phytosanitary Standards: Indian agricultural exports often face rejections in key markets due to quality concerns, indicating a need for improved standards.
• Low Productivity and Income: A significant number of Indian farmers own small landholdings, limiting their productivity and income potential. Many also rely on outdated farming methods, resulting in low yields and inefficient resource use.
• Limited Trade Collaboration: India’s trade agreements frequently lack substantial discussions on sustainable food systems, which limits growth opportunities through mutual agreements on standards.
• Absence of Export Strategy and Data: There is a deficiency in product-specific export strategies and comprehensive data to support trade planning aligned with sustainable food systems.

What is Needed for a Sustainable and Inclusive SFS in India?

• Sustainable Practices: Adoption of sustainable practices such as effective water usage, soil health restoration, and environmentally friendly farming methods is necessary.
• Support for Smallholder Farmers: Enhancing access to financial services, technology, and markets for marginalized farmers is crucial for empowerment.
• Implement Farm-to-Fork Traceability: Ensuring product traceability is vital for maintaining quality, safety, and sustainability across the food supply chain.
• Collaboration with International Agencies: Organizations like FAO, the International Fund for Agricultural Development, and the World Food Programme (WFP) collaborate with the Indian government to promote agricultural reforms and support smallholder farmers through education, technology, and financial resources.
• Enhance Quality Testing and Certification: Strengthening quality control through improved testing and certification processes will enable Indian agricultural products to meet international standards.
• Strengthening Social Safety Nets: Efficient food distribution systems are needed to support non-agricultural families, ensuring that food remains affordable and accessible.

Conclusion

India is grappling with significant hidden costs in its agrifood system, primarily driven by unhealthy dietary practices and environmental degradation. Despite progress being made, challenges such as climate change, export restrictions, and low productivity remain substantial barriers. A comprehensive approach that emphasizes sustainable practices, support for smallholder farmers, and international collaboration is essential for developing a resilient and inclusive agrifood system that aligns with global sustainability objectives.

Mains Question:

• Evaluate India’s agrifood system and identify the major hidden costs. How can India address these challenges to achieve sustainable food systems?