Daily Prelims Newsletter for upsc 12 Mar 2022

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Daily Prelims Newsletter for upsc 12 Mar 2022

Daily Prelims Newsletter For UPSC
| RaghukulCS

12 Mar 2022-Saturday

Table Of Contents

Table of Contents

Dollar-Rupee Exchange

Why in the news?

As part of its liquidity management initiative, the Reserve Bank of India (RBI) recently held a USD 5 billion dollar-rupee swap auction. This action will result in the infusion of dollars and the evaporation of the rupee from the financial system.

This will relieve inflationary pressures and strengthen the rupee.

What exactly is a Dollar-Rupee Swap auction?

It is a forex tool in which the central bank purchases another currency with its own currency or vice versa. Swap of Dollars and Rupees: The central bank purchases dollars (US dollars or USD) from banks in exchange for Indian rupees (INR) and then immediately enters into a counter-deal with banks promising to sell dollars at a later date.

Swap of Dollars and Rupees: When the central bank sells dollars, it withdraws an equal amount in rupees, reducing rupee liquidity in the system.

Because the transaction terms are predetermined, there are no exchange rate or other market risks with these swap operations.

What does the RBI intend to do?

The RBI sold USD 5.135 billion to banks while also agreeing to buy the dollars back at the end of the swap settlement period.

The goal here is for the central bank to acquire dollars from the seller while charging the lowest possible premium for the two-year tenor.

As a result, banks that bid in the lower range of the auction are successful.

Assuming a rupee rate of 75, the system’s liquidity will be reduced by Rs 37,500 crore.

Why is the RBI using it now?

Surplus liquidity in the system is estimated to be Rs 7.5 lakh crore, which must be reduced in order to keep inflation under control.

Typically, the central bank will use traditional tools such as raising the repo rate or the Cash Reserve Ratio (CRR), but this can have a negative impact on the economy.

Inadequate transmission of monetary policy exemplifies this negative implication.

As a result, the RBI used a different toolkit last year – the Variable Rate Reverse Repo Auction (VRRR).

However, banks undersubscribed the recent VRRR auctions because the cash market offered instant and better yields, forcing the RBI to consider a longer-term liquidity adjustment tool such as forex auctions.

What is the effect of the switch?

Reduced Liquidity: The main effect will be a reduction in liquidity, which is currently estimated to be around Rs 7.6 lakh crore.

Stopping the Indian Rupee’s Depreciation: Dollar inflows into the market will strengthen the rupee, which has already reached the 77 level against the US dollar.

Containing Inflation: When inflation threatens to rise sharply, the RBI typically reduces liquidity in the system. Inflation is expected to rise as a result of the following factors:

Inflation is expected to rise in the coming days as crude oil prices rise sharply as a result of the Russia-Ukraine war.

Outflow of Institutional Investment: Foreign portfolio investors are withdrawing funds from India.

What exactly is the Liquidity Management Initiative (LMI)?

A central bank’s “liquidity management” is defined as the framework, set of instruments, and rules that the central bank uses to steer the amount of bank reserves in order to control their price (i.e. short term interest rates) in accordance with its ultimate goals (e.g. price stability).

Bank reserves are the cash minimums that financial institutions must maintain in order to comply with central bank requirements.

The RBI’s Liquidity Management Initiative is a monetary policy tool that allows banks to borrow money through repurchase agreements (repos) or to lend money to the RBI through reverse repo agreements.

Among the instruments included in this framework are: repo/reverse repo auctions. Forex Swaps Using the Marginal Standing Facility (MSF).

Project for the Tapi-Par-Narmada Link

Why in the news?

Some tribals have recently increased their opposition to the Par-Tapi-Narmada river linking project after it was mentioned in the finance minister’s budget speech (2022-23).

What is the context?

These projects were approved in 2010 as part of a tripartite agreement signed by the Union government, Gujarat, and Maharashtra.

In her Budget Speech, the Finance Minister stated that five river-linking projects will be pursued once states reach an agreement.

Damanganga-Pinjal, Par-Tapi-Narmada, Godavari-Krishna, Krishna-Pennar, and Pennar-Cauveri are the projects.

The Ken-Betwa project is the first in the government’s National Perspective Plan for river interconnection.

The National River Linking Project (NRLP), formally known as the National Perspective Plan, envisions the transfer of water from water’surplus’ basins where flooding occurs to water’deficit’ basins where drought/scarcity occurs, via inter-basin water transfer projects.

What exactly is the Par-Tapi-Narmada River Connecting Project?

The Par Tapi Narmada Link project proposes to transfer water from the Western Ghats’ water surplus regions to Saurashtra and Kutch’s water deficit regions (Gujarat).

The link project calls for the construction of seven reservoirs in north Maharashtra and south Gujarat.

Water from the seven proposed reservoirs would be routed through a 395-kilometer-long canal to take over a portion of the command of the ongoing SardarSarovar Project (on the Narmada), while also irrigating small enroute areas.

Jheri, Mohankavchali, Paikhed, Chasmandva, Chikkar, Dabdar, and Kelwan are the seven dams proposed in the scheme.

This would save SardarSarovar water, which would then be used to expand irrigation in Saurashtra and Kutch.

The link primarily calls for the construction of seven dams, three diversion weirs, two tunnels, a 395-kilometer-long canal, six power plants, and a number of cross-drainage works.

What are the Project’s Advantages?

The link will generate hydropower of the order of 93.00 Mkwh through power houses installed at four dam sites, in addition to providing irrigation benefits to the enroute command and Narmada command.

The reservoirs will also provide flood relief to those who live downstream.

What are our current understandings of the Narmada River?

The Narmada is the peninsular region’s largest west-flowing river, flowing through a rift valley between the Vindhya Range to the north and the Satpura Range to the south.

It rises in Madhya Pradesh from the Maikala range near Amarkantak.

It drains a large area in Madhya Pradesh, as well as some areas in Maharashtra and Gujarat.

The DhuanDhar Falls are formed by the river near Jabalpur (Madhya Pradesh).

The Narmada estuary contains several islands, the largest of which is Aliabet.

Hiran, Orsang, Barna, and Kolar are the major tributaries.

Indira Sagar, Sardar Sarovar, and other major hydropower projects are located in the basin.

What are our current understandings of the Tapi River?

Another significant westward flowing river originates in Madhya Pradesh’s Betul district in the Satpura ranges.

It flows parallel to the Narmada in a rift valley but is much shorter in length.

Its basin includes Madhya Pradesh, Gujarat, and Maharashtra.

What are our current understandings of the Par River?

The Par River is a river in Gujarat that originates near the village of Wadpada in Nashik, Maharashtra.

It eventually empties into the Arabian Sea.

What is the River Interlinking Programme?

Aim: The InterLinking of Rivers (ILR) programme aims to connect the country’s surplus rivers with deficient rivers so that excess water from surplus regions can be diverted to deficient regions.

Reducing Regional Imbalance: India is dependent on erratic and regionally imbalanced monsoon rains. River interconnection will reduce the amount of excess rain and river water that flows into the sea.

Irrigation for Agriculture: Through the transfer of surplus water to deficit regions, interlinking can provide a solution to India’s rain-fed irrigation problems.

Reducing Water Stress: To some extent, this can help to mitigate the effects of drought and flooding.

Other advantages include hydropower generation, year-round navigation, and job creation. Ecological benefits will be realised as dried-up forests and lands are replenished.

Challenges:

Environmental Costs: The project has the potential to obstruct rivers’ natural ecology.

Climate Change: It is assumed in interlinking systems that the donor basin has excess water that can be transferred to the recipient basin.

If any system’s basic assumption goes haywire as a result of climate change, the entire concept is thrown out the window.

Economic Costs: It is estimated that river interconnection will impose a significant financial burden on the government.

The estimated socioeconomic impact of the 15000 km network of canals is that it will displace approximately 5.5 million people, mostly tribals and farmers.

The Way Forward

India must conserve every drop of water, reduce waste, ensure equitable resource distribution, and improve groundwater. So, on a small scale, simple things must be tried.

Local solutions (such as improved irrigation practises) and watershed management should be prioritised.

The government should instead consider the National Waterways Project (NWP), which “eliminates” friction between states over the sharing of river waters by using only excess flood water that would otherwise go into the sea.

Scheme for Strengthening the Pharmaceutical Industry

Why in the news?

The Ministry of Chemicals and Fertilizers recently released the guidelines for the “Strengthening of Pharmaceutical Industry (SPI)” scheme, which has a total financial outlay of Rs.500 Cr for the fiscal years FY 21-22 to FY 25-26.

What are the most important points?

About the Scheme: The Scheme will provide financial assistance to pharma clusters for the establishment of Common Facilities.

Interest subvention or capital subsidy on capital loans will be provided to SMEs and MSMEs (Micro, Small and Medium Enterprises) in order to upgrade their production facilities to meet national and international regulatory standards (World Health Organization-Good Manufacturing Practice (WHO-GMP) or Schedule-M), facilitating both volume and quality growth.

WHO-GMP is a quality assurance aspect that ensures that medicinal products are consistently produced and controlled to the quality standards appropriate to their intended use and as specified in the product specification.

The GMP requirements for the pharmaceutical industry in India are defined in Schedule M of the Drugs and Cosmetics Rules.

Components: Assistance to Pharmaceutical Industry for Common Facilities (APICF), which aims to strengthen existing pharmaceutical clusters’ capacity for long-term growth by establishing shared facilities.

Support for clusters for the creation of common facilities with a focus on R&D (Research and Development) Labs, Testing Laboratories, Effluent Treatment Plants, Logistic Centers, and Training Centers is proposed, with a budget of 178 Cr.

The Pharmaceutical Technology Upgradation Assistance Scheme (PTUAS) assists Micro, Small, and Medium Pharma Enterprises (MSMEs) with a proven track record in meeting national and international regulatory standards.

Support for SME Industries is proposed under the PTUAS sub-scheme, either through interest subvention of up to 5% per annum (6% in the case of units owned and managed by SC/STs) or through credit linked capital subsidy of 10%.

A budget of 300 crores has been set aside for sub-schemes over a five-year period.

Pharmaceutical and Medical Devices Promotion and Development Scheme (PMPDS) to facilitate the growth and development of the Pharmaceutical and Medical Devices Sectors through study/survey reports, awareness programmes, database creation, and industry promotion.

Knowledge and awareness about the pharmaceutical and medical technology industries will be promoted through the PMPDS sub-scheme.

What is the Importance?

It will improve existing infrastructure and position India as a global leader in the pharmaceutical sector.

This will not only improve the quality of the clusters, but will also ensure their long-term growth.

The scheme will address the rising demand for assistance to existing Pharma clusters and MSMEs across the country in order to improve productivity, quality, and sustainability.

What are the Schemes Involved in the Pharmaceutical Industry?
Scheme for Promoting Bulk Drug Parks:

The government intends to build three mega Bulk Drug Parks in India in collaboration with states in order to reduce the country’s manufacturing costs and reliance on other countries for bulk drugs.

The scheme will also help to ensure a continuous supply of drugs and the provision of affordable healthcare to citizens.

Production Linked Incentive (PLI) Scheme: The PLI scheme seeks to encourage domestic production of critical Key Starting Materials (KSMs)/Drug Intermediates and Active Pharmaceutical Ingredients (APIs) in the country.

Other’s News

Santhali Sohrai Murals

It is one of the Santhals’ oldest art forms of wall painting, dating back to 10,000–4,000 BC.

Sohrai paintings are centuries-old tribal traditional paintings that depict natural themes such as forests, people, and animals.

These paintings, which can be monochromatic or colourful, are part of a long tradition of the Santhal community, which dominates the districts of Keonjhar and Mayurbhanj in Odisha, East Singhbhum and Seraikela-Kharsawan in Jharkhand, and Purulia in West Bengal.

Occasion – Santhali women usually paint their houses to commemorate Sohrai, a harvest festival that coincides with Diwali or Kali Puja.

During ceremonies or special occasions such as weddings and childbirth, the art is also displayed on walls.

Aside from the Santhals, the district’s Bhumij community also paints them.

It is one of the Santhals’ oldest art forms of wall painting, dating back to 10,000–4,000 BC.

Sohrai paintings are centuries-old tribal traditional paintings that depict natural themes such as forests, people, and animals.

These paintings, which can be monochromatic or colourful, are part of a long tradition of the Santhal community, which dominates the districts of Keonjhar and Mayurbhanj in Odisha, East Singhbhum and Seraikela-Kharsawan in Jharkhand, and Purulia in West Bengal.

Occasion – Santhali women usually paint their houses to commemorate Sohrai, a harvest festival that coincides with Diwali or Kali Puja.

During ceremonies or special occasions such as weddings and childbirth, the art is also displayed on walls. Aside from the Santhals, the district’s Bhumij community also paints them.

The Hazaribagh murals are more primitive, with various motifs, whereas the Santhali Sohrai art is only geometric shapes. Furthermore, the women of Hazaribagh only use earth colours for their murals – red, black, and white.

The district’s north Karanpura valley, as well as the Satpahar and Sati hill ranges, are rich in coal, iron, and manganese deposits.

Sohrai Sohrai is a five-day festival celebrated by the Santhal, Munda, Prajapati, Khurmi, and Oraon tribes of Jharkhand, Chhattisgarh, Odisha, and West Bengal in India.

It is a Harvest Festival that takes place at the beginning of the winter harvest season.

It is also known as the cattle festival.

It is observed during Amavasya in the Hindu calendar month of Kartik (October-November).

For the Santhals, Sohrai is the most important festival.

It is the Harvest Festival, which takes place in early January following the rice harvest.

Argon-40 is observed by Chandrayaan-2 in the Moon.

The Chandrayaan-2’s Atmospheric Composition Explorer-2 (CHACE-2) makes the first-ever observations of the distribution of Argon-40 in the Moon’s Exosphere.

CHACE-2 

The quadrupole mass spectrometer CHACE-2 is aboard the Chandrayaan-2 mission.

CHACE-2 was a follow-up experiment to the CHACE experiment carried out on the Moon Impact Probe (MIP) of the Chandrayaan-1 mission.

It is also inspired by the Mars Exospheric Neutral Composition Analyzer (MENCA) experiment carried aboard the Indian Mars Orbiter Mission.

Argon-40

Noble gases are important tracers for understanding surface-exosphere interaction processes.

Argon-40 (Ar-40) is a critical tracer atom for studying the dynamics of lunar exospheric species.

Argon is a noble gas that is inert, colourless, and odourless. The isotope Argon-40 makes up the vast majority of Argon on Earth.

Ar-40 is formed by the radioactive disintegration of Potassium-40 (K-40), which is present beneath the lunar surface.

[The production of argon-40 from potassium-40 decay is used to determine the age of the Earth (potassium-argon dating).]

Ar-40 is formed and diffuses through intergranular space, eventually reaching the lunar exosphere via seepages and faults.

Observations

CHACE-2 observations show an increase in Ar-40 density near the sunrise terminator, a decrease through the dayside, a secondary peak near the sunset terminator, and a night-side minima.

Despite differences in temperature and topography, the variation in the number density of Ar-40 with respect to solar longitudes in mid-latitude regions is similar to that in low-latitude regions.

Furthermore, there is significant spatial heterogeneity in Ar-40 distribution.

There are localised enhancements (referred to as Argon bulges) in several regions, including the KREEP [potassium (K), rare-earth elements, and phosphorus (P)] terrain and the South Pole Aitken terrain.

The presence of an Argon bulge indicates the presence of unidentified or additional loss processes, Moon quakes, or regions with lower activation energies.

Although the Apollo-17 and LADEE missions detected the presence of Ar-40 in the lunar exosphere, their measurements were limited to the Moon’s near-equatorial region.

CHACE-2 observations show the diurnal and spatial variation of Ar-40 over the Moon’s equatorial and mid-latitude regions.

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