Daily Mains Newsletter for UPSC 23 Jun 2022

Daily Mains Newsletter For
UPSC | RaghukulCS

23 June 2022 -Thursday


Table of Contents

RBI's Payment Vision 2025

In News, why?

The Reserve Bank of India (RBI) released “Payments Vision 2025” with the goal of offering every user quick, easy, simple, economical, safe, and secure e-payment solutions.

Payment Vision 2025: What is it?

  • About: The Board for Regulation and Supervision of Payment and Settlement Systems of the RBI provided guidelines that was taken into account when developing Payments Vision 2025.
  • The Payments Vision 2019–21 projects are built upon by this.
  • The five anchor goals of Integrity, Inclusion, Innovation, Institutionalization, and Internationalization are articulated in the Payments Vision 2025 document.

 Everyone, Everywhere, every time Using Electronic Payments (4Es).

  • Objectives: To improve payment systems so that they enable users with convenient, low-cost payment solutions that can be used whenever and wherever they choose.
  • To make it possible to geotag digital payment infrastructure and transactions, as well as to review the rules for prepaid payment instruments (PPIs), including closed system PPIs.
  • regulating all main payment ecosystem intermediaries and connecting UPI to credit cards and financial products’ credit components.
  • To improve Cheque Truncation System (CTS), including the clearing and settlement perspective of One Nation One Grid and the development of a payment system for processing online merchant payments via internet and mobile banking.
  • BigTech and FinTech regulation in the payments sector.
  • BNPL (Book Now Pay Later) payment mechanisms are examined, and relevant rules for BNPL payments are investigated.
Goals to Achieve:
  • Less than 0.25 percent of all retail payments should be made using checks.
  • a threefold increase in digital payment transactions.
  • UPI will rise by an average annualised 50% while IMPS and NEFT will grow by 20%.
  • an increase in payment transaction volume relative to GDP of 8.
  • 20 percent more debit card transactions at the point of sale.
  • Use of debit cards will eventually outpace that of credit cards.
  • PPI transactions have increased by 150 percent.
  • Infrastructure for accepting cards will grow to 250 lakh.
  • 50 percent CAGR growth in the number of customers who have enrolled for mobile-based transactions.
  • Cash in circulation (CIC) decline expressed as a proportion of GDP.

What is the Meaning of the Change?

  • India’s payment ecosystem will be significantly shaped by the RBI’s Payments Vision 2025, which will advance a secure, seamless, and safer payment infrastructure.
  • The RBI’s general objectives will serve as this document’s yardstick for all payment players, FinTechs, and other stakeholders, pushing them to improve their skills.
  • Global Reach:
  • The RBI has democratised payments within India through programmes like UPI. With the 2025 vision, payments will be accessible to “Everyone, Everywhere, Everytime,” providing Indian payment systems a worldwide reach and enhancing their security, speed, convenience, and affordability.

What are the Payments Vision 2019–21 Accomplishments?

  • The Payments Vision 2021 set four goals for competition, cost, convenience, and confidence in order to empower every Indian with access to a variety of safe, secure, simple, rapid, and economical e-payment solutions.

The following projects have succeeded in achieving these objectives:


 establishment of a regulatory sandbox, granting non-bank PSOs access to centralised payment systems (CPS), facilitation of small value digital payments made offline, ‘on tap’ authorization of payment systems, internationalisation of domestic payment systems, feature phone-based payment services, framework for self-regulatory organisation of payment systems, etc.

  • Cost:
  •  The waiver of fees paid by the RBI for transactions handled through the National Electronic Funds Transfer (NEFT) and Real Time Gross Settlement (RTGS) systems, among other systems.
  • Convenience
  • includes things like NEFT, RTGS, and the National Automated Clearing House (NACH) being accessible around-the-clock, standardising Turn-Around-Time (TAT) for dispute settlement and compensating for unsuccessful transactions, etc.
  • A framework for regulating Payment Aggregators (PAs), e-mandates for recurring transactions, tokenization of card transactions, Card-on-File Tokenization (CoFT), and other practises inspire confidence.

Economic Effects of Certain SC and NGT Decisions

In News, why?

  • The National Green Tribunal of India (NGT) and the Supreme Court of India recently delivered a paper to the NITI Aayog titled Economic Impact of Select Decisions.
  • The NITI Aayog commissioned and entirely sponsored the study, which was carried out by CUTS (Consumer Unity and Trust Society).

What are the Study’s Key Highlights?

Five significant Supreme Court and NGT orders pertaining to the environment are among the judicial orders that CUTS investigates in terms of their economic effects.

The study contains:
  • M/s Sesa Sterlite Ltd & Ors, The Goa Foundation v., 2018
  • The 2019 Mopa Airport Case between Hanuman Laxman Aroskar and the Union of India
  • Sterlite Industries (I) Ltd v. The Tamil Nadu Pollution Control Board (Sterlite Copper Plant Case), 2019
  • Ministry of Environment & Forests and Others (Sand Mining Case) v. The National Green Tribunal Bar Association, 2013
  • 2016 case of Vardhman Kaushik v. Union of India & Others (NCR Construction Ban Case)
Five Judicial Orders Related to Environmental Economic Impacts:
  • According to a research of the economic effects of five specific environmental court decisions, between mid-2018 and mid-2021, restrictive orders relating to the environment had a negative impact on 75,000 people.
  • Between mid-2018 and mid-2021, the Indian government lost Rs 8,000 crore in revenue.
  • The economic returns would have totaled Rs 20,000 crore if this revenue had been used for capital expenditures.
  • According to the analysis, 16,000 people lost their jobs as a result of the five verdicts.
  • Nearly Rs 15,000 crore in revenue was lost for the sector, while workers lost over Rs 500 crore in income.

Case Study of Goa’s Ban on Mining:

  • Increase in State Public Debt:
  • From 2007 to 2021, the state’s public debt climbed at a Compound Annual Growth Rate (CAGR) of 10.06 percent as a result of Goa’s mining ban.Due to the suspension of mining, the state’s market borrowing climbed at a CAGR of 19.93%.
  • Revenue Shortfall at the Federal and State Levels:
  •   The mining industry’s taxes caused an estimated deficit in federal and state revenues of Rs. 668.39 crore, while the state’s revenues alone had an estimated deficit of Rs. 1,821.32 crore.
  • Mining Company Loss:
  •   Between 2018–19 and 2020–21, mining businesses are expected to have lost Rs. 6,976.71 crore.
Employment Loss:
  • In the event of the mining closure, the total net employment loss (direct and indirect) is close to 15,000.

What are the study’s recommendations?

  • Strike a Balance: It urges the judiciary and judges to be given the tools they need to strike a balance between the economy and environmental considerations.
  • For instance, in the case of the National Capital Region construction ban, the inefficiency of the judicial and executive processes in reducing pollution highlights the existence of flaws in the established processes and systems due to a variety of factors, such as limitations on capacity and expertise, a lack of resources, etc.
  • It brought attention to the necessity of topic specialists or experts advising judges in matters with economic repercussions.
  • It advised modifying the judge selection process as well.
  • The National Judicial Commission statute might be reinstituted in order to improve the calibre of judges.
  • To understand the necessity for a comprehensive and balanced approach, it is crucial for judicial officers to be exposed to (basic) economic issues.
Judiciary Accountability:
  • It also called for judicial accountability to guarantee a high standard of jurisprudence analysis and decision-making.
  • The greater public good should be taken into consideration when making decisions by the SC in situations when strict adherence to legal requirements could result in significant economic losses.
  • By imposing fines and punishments on personnel and politicians involved in overt corruption and incidents of poor administration, the top court must demand accountability.
Transparency at All Levels:
  • It is crucial to include considerations for fairness, the environment, and the economy in decision-making at all levels, including the judiciary, while also keeping in mind the greater goals of human-centric economic development and environmental sustainability.

ICT use in Indian schools is acknowledged by UNESCO.

In News, why?

  • The King Hamad Bin Isa Al-Khalifa Prize for 2021 is awarded to the Central Institute of Educational Technology (CIET).
  • The Department of School Education & Literacy’s National Council of Educational Research and Training (NCERT), which houses CIET, is a constituent institution of NCERT.
  • The United Nations Educational, Scientific, and Cultural Organization (UNESCO) has recognised CIET for its use of ICT in Education as part of a broad programme dubbed PM eVIDYA.

PM eVIDYA: What is it?

  • On May 17, 2020, the Ministry of Education launched the PM eVIDYA as a component of the Atma Nirbhar Bharat Abhiyaan.
  • It unites all efforts made in connection with digital, online, and on-air education to provide multi-mode access for the delivery of education while minimising learning losses.

What is the King Hamad Bin Isa Al-Khalifa Prize, given by UNESCO?

  • With the help of the Kingdom of Bahrain, it was founded in 2005.
  • According to the 2030 Agenda for Sustainable Development and its Goal 4 on Education, this award “recognises creative initiatives in utilising new technology to improve educational and lifelong learning opportunities for all.
  • The Prize honours people and organisations who are working on exceptional initiatives and advocating for the innovative application of technologies to improve learning, teaching, and overall educational performance in the modern day.

 Every year, two outstanding projects are chosen by an international jury.

During the ceremony at the UNESCO Headquarters in Paris, each prizewinner is given USD 25,000, a medal, and a diploma.

What initiatives is the Ministry of Education putting forward through CIET and NCERT?

  • A large number of eBooks, eContent—audiobooks, videos, interactives, augmented reality contents, Indian Sign Language (ISL) videos, audiobooks, talking books, etc.—have been designed, developed, and disseminated by the Ministry of Education through CIET in accordance with the recommendations of NEP-2020.
  • several online courses for teacher and school education,
  • Utilizing online/offline, on-air technologies such as One Class One Channel, DIKSHA, ePathshala, NISHTHA, school MOOCs on SWAYAM, etc. to organise digital events like online quizzes primarily for students and teachers.
Launch of PM eVidya:
  • In May 2020, PM eVidya was introduced in order to further the goals of NEP and Samagra Shiksha and meet the aforementioned pillars.
Learning at the Children’s Doorsteps:
  • The CIET took learning to the children’s doorsteps by employing roughly 397 radio stations, including community radio stations, and 12 PM eVidya DTH TV channels extensively, resolutely, ethically, and coherently.
  • These initiatives were particularly useful for connecting with pupils during pandemic conditions when schools were closed.
  • These initiatives greatly assisted in stopping the learning lull.

What other education-related initiatives are there?

  • National Technology Enhanced Learning Program
  • The Rashtriya Ucchatar Shiksha Abhiyan (RUSA)
  • Fellowship for Prime Minister’s Research (PMRF)
  • Plan to Encourage Academic and Research Cooperation (SPARC)
  • NEAT
  • Midday Meal Plan
  • 2009’s Right to Education Act
  • It’s Beti Bachao, Beti Padhao.

Dual Deficiency Issue

In News, why?

  • The finance ministry issued a warning about the resurgence of the twin deficit issue in the economy in its “Monthly Economic Review,” noting that higher commodity prices and a rise in the cost of subsidies would result in an increase in both the fiscal deficit and the current account deficit (CAD).
  • Additionally, it’s the first time that the administration has openly discussed the potential for fiscal slippage in the current fiscal year.

What are the Report’s Key Highlights?

  • The danger of widespread stagflation is clearly present to the world.
  • However, due to its careful stabilisation measures, India is not at high risk of stagflation.
  • The last eight months have seen significant foreign investment withdrawals from Indian financial markets. The situation has worsened as a result of a dim GDP growth outlook.
  • There is a 5% possibility of outflows under portfolio investments of 7.7% of GDP and short-term trade credit contraction of 3.9 percent of GDP in a black swan event consisting of a combination of shocks (GDP).

What effects will the twin deficit problem have?

  • The twin deficit issue, particularly the expanding current account deficit, could amplify the impact of more expensive imports and devalue the rupee, further escalating external imbalances.

Way ahead

  • Reduce spending and revenue (or the money government spends just to meet its daily needs).
  • encouraging home production while reducing imports of non-essential goods
  • A prudent fiscal strategy To prevent a budgetary slippage, the government should rationalise both capital and revenue expenditures and pursue a balanced budget.

Major Terms

  • The difference between the government’s required expenditures and its receipts is known as the fiscal deficit. This sums up the annual borrowing requirements of the government.
  • Deficit in current accounts (CAD): The country’s inflow and outflow of goods, services, and investments are tracked by the current account. Similar to the capital account, it is a part of a country’s balance of payments and indicates a country’s overseas transactions (BOP).
  • The twin deficit issue Together, the twin deficits of current account deficit and fiscal deficit—also known as “budget deficit”—occur when a country’s expenditures exceed its receipts. The twin deficits frequently reinforce one another, with a large fiscal deficit causing a bigger CAD and vice versa.
  • Stagflation is a condition in the economy where the growth rate slows down, the unemployment rate stays high and stable, and at the same time, inflation or price levels remain high.
  • Black Swan Event: It can be described as the culmination of every negative shock ever encountered in history, creating the ideal storm.

Unrecognized Political Parties Registered (RUPP)

In News, why?

  • Three of the parties were sent to the Department of Revenue for legal action for “severe financial wrongdoing” after the Election Commission ordered the deletion of 111 registered but unrecognised political parties that it discovered to be “non-existent.”
  • This was the second time recently that registered parties deemed to be in violation of the Representation of the People Act, 1951, had faced such a legal action.
  • Earlier, 87 nonexistent registered unrecognised political parties have been removed by the EC.
  • The EC said that the 111 parties in question had broken provisions of the Act requiring them to provide the EC with their address of communication and any changes to that address.

What are the Important Points in Relation to Political Parties?

Unrecognized Political Parties That Are Registered (RUPP):
  • Unrecognized parties are those that have recently been registered, did not receive a sufficient number of votes in the assembly or general elections to qualify as a state party, or have never run in an election after being registered.
  • These parties do not get all the advantages given to the recognised parties.
Political Party That Has Been Recognized:
  • If a political party meets specific requirements, it can be recognised as either a national party or a state party.
  • A party must obtain a specific minimum percentage of valid votes cast or a specific number of seats in the state legislative assembly or the Lok Sabha during the most recent election to be recognised as a political party, either at the state or national level.
  • The parties’ eligibility for certain privileges, like as the assignment of party emblems, the allotment of time for political broadcasts on state-owned television and radio stations, and access to electoral rolls, is determined by the recognition the Commission grants the partie

What prerequisites must be met before political parties can be recognised?

Conditions for National Party Recognition
Requirements for State Party Recognition

If any of the following requirements are met, a party is recognised as a national party: If it receives 6 percent of valid votes cast in four or more states at a general election for the Lok Sabha or the legislative assembly and also wins four seats in the Lok Sabha from any state or states; If it receives 2 percent of seats in the Lok Sabha at a general election and these candidates are elected from three states; or If it receives 2 percent of seats in the Lok Sabha at a general election.

·         if four states recognise it as a state party.

·         A party is recognised as a state party in a state if one of the following criteria is met: if it obtains 2 seats in the state’s assembly and 6 percent of the valid votes cast in the state during a general election for the legislative assembly of the state in question;

·         If it wins 1 seat in the Lok Sabha from the state in question and 6 percent of the legitimate votes cast in the state during a general election for the Lok Sabha, then

·         If it wins three seats in the assembly or more than three percent of the seats up for election in the state’s legislative assembly at a general election,

·         If it wins 1 Lok Sabha seat for each 25 seats (or portion thereof) assigned to the state at a general election for the Lok Sabha from that state,

·         If it wins 8% of the legitimate votes cast in the state during a general election for the state’s legislative assembly or for the Lok Sabha. This prerequisite was included in 2011.

Introduction to the Representation of the People Act (RPA):
  • The foundational requirement of democracy is the holding of free and fair elections. Part XV (Articles 324–329) of the constitution was adopted to assure the free, fair, and impartial conduct of elections, and it gave Parliament the authority to enact legislation to control the electoral process.
  • The Representation of the People Act (RPA), 1950, and the Representation of the People Act, 1951, were passed by the Parliament in this regard.
  • 1950’s Representation of the People Act
Important Clauses:
  • outlines the processes for constituency delimitation.
  • outlines how seats will be distributed in the House of Representatives, state legislative councils, and assemblées législatives.
  • outlines the process for creating the electoral rolls and how seats will be filled.
  • specifies the requirements for voting.

The 1951 Representation of the People Act (RPA):

Important Clauses:
  • It controls how elections and by-elections are really conducted.
  • It offers the electoral process’ administrative framework.
  • Political party registration is a topic covered by it.
  • It details the requirements and exclusions for membership in the Houses.
  • It contains regulations to prevent crimes such as corruption and other offences.
  • It outlines the process for resolving questions and disagreements related to elections.
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