Call Us Now

+91 9606900005 / 04

For Enquiry

Current Affairs for UPSC IAS Exam – 3rd & 4th January 2021


  1. RBI worries even with the decline in bad loans
  2. Iran’s 20% enrichment plans: Defying Vienna convention
  3. Direct observation of Klein tunneling
  4. Asian Waterbird Census (AWC)
  5. Overexploitation at Deepor Beel – Ramsar Site



  • India’s economy had been declining sharply even before the emergence of the virus, and the lockdowns imposed to curb the spread of the virus upended businesses and revenue models across industries.
  • RBI believes that the true of the state of borrowers’ accounts and consequently, the banking system in general, and the economy at large, will emerge once these policy support measures are rolled back – hence, painting a grim picture.


GS-III: Indian Economy (NPAs)

Dimensions of the Article:

  1. Background to the Current Situation of India’s Banking System
  2. What is the Twin Balance Sheet Problem of India?
  3. Reasons for the Current Situation of Reducing Bad Loans
  4. What exactly has the RBI said about banks’ health?
  5. What does this mean for India’s hopes for a bounce-back in the economy?
  6. What happens next?

Background to the Current Situation of India’s Banking System

  • During 2018 non-performing assets (NPAs) or ‘Bad loans’ peaked to more than 11% of total loans.
  • India’s ‘twin balance sheet problem’ of 2016-17 had sent banks down a slippery slope, beset by dangerously high levels of non-performing assets.
  • After losses in two consecutive years, India’s scheduled commercial banks turned profitable in 2019-20 and the losses incurred by State-run banks were much more stifled.
  • According to RBI, the first half of 2020-21 saw even greater improvements in banks’ vital statistics, with non-performing assets (NPAs) reducing (GNPA reduced from 11% to 7.5%) as well.
  • The RBI primarily attributed this to the resolution of a few large accounts through the introduction of the Insolvency and Bankruptcy Code (IBC) in 2016.

What is the Twin Balance Sheet Problem of India?

A balance sheet is a financial statement that summarises a company/institution’s assets, liabilities and shareholder’s equity at a specific point of a time.

Twin Balance Sheet Problem (TBS) deals with two balance sheet problems. One with Indian companies and the other with Indian Banks – hence TBS, is a two-fold problem for Indian economy.

  1. Problem of Overleveraged companies – Debt accumulation on companies is very high and thus they are unable to pay interest payments on loans. Note: 40% of corporate debt is owed by companies who are not earning enough to pay back their interest payments. In technical terms, this means that they have an interest coverage ratio less than 1.
  2. Problem of Bad-loan-encumbered-banks – Non-Performing Assets (NPA) of the banks is 9% for the total banking system of India. It is higher than 12% for Public Sector Banks. As companies fail to pay back principal or interest, banks are also in trouble.
  • Origin of TBS problem can be traced to the 2000s when the economy was on an upward trajectory.
  • The problem was particularly acute in the infrastructure sector, where high-stakes bets on several projects unravelled as growth (and demand) fizzled out following the global financial crisis of 2008.
  • The stress from stretched corporate balance sheets infected banks’ own books and underwhelmed their capacity for fresh lending.
  • This vicious cycle was interrupted to an extent by the IBC, which, along with tighter recognition norms for bad loans, helped correct the course over time.

Reasons for the Current Situation of Reducing Bad Loans

The reason bad loans and insolvency proceedings have not surged as multiple businesses underwent losses (taking millions of employees with outstanding retail loans down with them) is the series of regulatory forbearance steps taken by authorities to help them tide over this unprecedented crisis.

  1. Interest rates were cut after the onset of the pandemic.
  2. A moratorium was offered on loan instalments due from borrowers.
  3. Liquidity was infused into the system to keep the wheels of the economy moving without a further shock.
  4. The invocation of the Insolvency and Bankruptcy Code (IBC) was suspended for loans that went into default during the Lockdown.
  5. A loan restructuring window for borrowers was offered for a considerable period.

According to the RBI; Despite all this, life support in the form of adequate credit flows to some productive and COVID-19-stressed sectors has been deficient.

What exactly has the RBI said about banks’ health?

  • The modest GNPA ratio (The ratio of Gross NPA to the total amount of loans given) of 7.5% in 2020 does not paint the real picture.
  • The data on gross non-performing assets (GNPA) of banks are yet to reflect the stress, obscured under the asset quality standstill with attendant financial stability implications.
  • Given the uncertainty induced by COVID-19 and its real economic impact, the asset quality of the banking system may deteriorate sharply in the future.
  • RBI has also warned about large-scale loan defaults looming over housing finance companies, which have been hit by delays in completion of housing projects, cost overruns due to reverse migration of labourers, and delayed investments by buyers in the affordable housing sector as incomes shrank and jobs were lost.
  • To make the banking sector healthy in the face of large-scale delinquencies and balance-sheet stress that the ravages of the pandemic leave behind, it is critical to “rewind various relaxations in a timely manner”, rein in loan impairment and ensure adequate capital infusion into banks.

What does this mean for India’s hopes for a bounce-back in the economy?

  • Simply put, banks’ ability to lend is critical for businesses and the economy to grow.
  • A deluge of bad loans impairs banks’ ability and willingness to lend, as has been evident in bankers’ aversion to risk in recent years.
  • It is safer to park their funds in government securities, and public sector banks, that have seen a surge in deposits after the recent troubles at co-operative and private lenders like the PMC Bank, Yes Bank, and now Lakshmi Vilas Bank, may prefer to do just that.
  • Currency with public surged in response to the COVID-19 induced dash for cash while solvency issues related to a private sector bank also brought about some reassignment of deposits.
  • During 2020-21 so far, deposits with PSBs grew at a higher pace than usual, partly reflecting perception of their safe haven status.
  • Latest data for November suggest a slight uptick in bank credit flows, but lending to industry as a whole still shrank.
  • While several private lenders have raised buffer capital to offset shocks from potential loan defaults, some large state-run lenders have announced plans to raise resources in a staggered manner, depending on the prevailing market circumstances.
  • Since public sector lenders still play a huge role in financing economic activity, it is important that they raise additional capital from the market or from their majority-owner — the government — before the stress ‘obscured’ by the COVID-19 relief measures becomes apparent.

What happens next?

  • The central bank has said that the Financial Stability Report (FSR) — which should have been released by now in the usual course of business — will be “released shortly”.
  • The findings of the FSR present an updated assessment of the gross NPAs and the capital adequacy of banks and hence, its findings will be critical in determining how gloomy the situation really is.
  • The Union Budget for 2021-22 would be critical for banks on two fronts – in what it does to revive demand and investments, and how much money it can promise to set aside for recapitalising public sector banks in the coming year.

-Source: The Hindu



Iran plans to enrich uranium up to 20% at its underground Fordo nuclear facility pushing its program a technical step away from weapons-grade levels and also going beyond the threshold set by the 2015 Vienna accord.


GS-II: International Relations (Agreements affecting India’s Interests, International Organizations), GS-III: Science and Technology (Nuclear Power)

Dimensions of the Article:

  1. What is Uranium Enrichment?
  2. Joint Comprehensive Plan of Action (JCPOA) or Vienna Talks
  3. International Atomic Energy Agency (IAEA)
  4. Non-Proliferation Treaty (NPT)

What is Uranium Enrichment?

  • When uranium is mined, it consists of approximately 99.3% uranium-238 (U238), 0.7% uranium-235 (U235), and < 0.01% uranium-234 (U234).
  • The nuclear fuel used in a nuclear reactor needs to have a higher concentration of the U235 isotope (which is only 0.7% of Uranium after mining) than that which exists in natural uranium ore.
  • U235 when concentrated (or “enriched”) is fissionable in light-water reactors (the most common reactor design in the USA).
  • Commercially, the U235 isotope is enriched to 3 to 5% (from the natural state of 0.7%) and is then further processed to create nuclear fuel.

Production of Nuclear Energy

  • During fission, the nucleus of the atom splits apart producing both heat and extra neutrons.
  • Under controlled conditions, these extra neutrons can cause additional, nearby atoms to fission and a nuclear reaction can be sustained.
  • The heat energy released, by the controlled nuclear reaction within the nuclear reactor, can be harnessed to produce electricity.

Joint Comprehensive Plan of Action (JCPOA) or Vienna Talks

  • The Joint Comprehensive Plan of Action (JCPOA) known commonly as the Iran nuclear deal or Iran deal, is an agreement on the Iranian nuclear program reached in Vienna on 14 July 2015, between Iran and the P5+1 (the five permanent members of the United Nations Security Council—China, France, Russia, United Kingdom, United States—plus Germany) together with the European Union.
  • Under this framework Iran agreed tentatively to accept restrictions on its nuclear program, all of which would last for at least a decade and some longer, and to submit to an increased intensity of international inspections under a framework deal.
  • The final agreement is based upon (and buttresses) “the rules-based nonproliferation regime created by the Nuclear Non-Proliferation Treaty (NPT) and including especially the IAEA safeguards system”.

International Atomic Energy Agency (IAEA)

  • The International Atomic Energy Agency (IAEA) is an international organization that seeks to promote the peaceful use of nuclear energy, and to inhibit its use for any military purpose, including nuclear weapons.
  • The IAEA was established as an autonomous organization in 1957, and even though it is established as an autonomous organization the IAEA reports to both the United Nations General Assembly and Security Council.
  • The IAEA has its headquarters in Vienna, Austria.
  • The IAEA serves as an intergovernmental forum for scientific and technical co-operation in the peaceful use of nuclear technology and nuclear power worldwide.
  • The programs of the IAEA encourage the development of the peaceful applications of nuclear energy, science and technology, provide international safeguards against misuse of nuclear technology and nuclear materials, and promote nuclear safety (including radiation protection) and nuclear security standards and their implementation.

Non-Proliferation Treaty (NPT)

  • The Treaty on the Non-Proliferation of Nuclear Weapons, commonly known as the Non-Proliferation Treaty or NPT, is an international treaty whose objective is to prevent the spread of nuclear weapons and weapons technology, to promote cooperation in the peaceful uses of nuclear energy, and to further the goal of achieving nuclear disarmament and general and complete disarmament
  • The NPT is often seen to be based on a central bargain: “the NPT non-nuclear-weapon states agree never to acquire nuclear weapons and the NPT nuclear-weapon states in exchange agree to share the benefits of peaceful nuclear technology and to pursue nuclear disarmament aimed at the ultimate elimination of their nuclear arsenals.”
  • The treaty defines nuclear-weapon states as those that have built and tested a nuclear explosive device before 1 January 1967; these are the United States, Russia, the United Kingdom, France, and China.
  • Four other states are known or believed to possess nuclear weapons: India, Pakistan, and North Korea have openly tested and declared that they possess nuclear weapons, while Israel is deliberately ambiguous regarding its nuclear weapons status.
  • The Treaty has 189 States Parties, which is the largest number of any arms control agreement.
  • However, India, Israel and Pakistan have not signed the NPT.
  • North Korea announced its withdrawal in 2003, and further announced that it had conducted an underground nuclear explosion in 2006 and 2009.

-Source: The Hindu



Researchers have shown the evidence for (almost a 100-years old) proposition that relativistic particles can penetrate a barrier with 100% transmission – Klein Tunneling.


Prelims, GS-III: Science and Technology

Dimensions of the Article:

  1. What is Klein Tunneling?
  2. Significance and Uses of Klein Tunneling (Recent Findings)

What is Klein Tunneling?

  • Klein tunneling refers to the absence of normal backscattering of electrons even under the case of high potential barriers.
  • In simple words, instead of electrons bouncing back after hitting a high potential barrier (like a wall) – the electrons pass through (like as if it went through a tunnel) with 100% transmission (none of the electrons are bounced off and scattered)
  • At the barrier interface, the perfect matching of electron and hole wavefunctions enables a unit transmission probability for normally incident electrons.
  • It is theoretically and experimentally well understood in two-dimensional relativistic materials such as graphene.

Significance and Uses of the Recent Findings


  • In current acoustic communications, the transmission loss of acoustic energy on the interface is unavoidable.
  • If the transmittance on the interface can be increased to nearly 100%, acoustic communications efficiency can be greatly improved, thus opening up cutting-edge applications.
  • This is especially important when the surface or the interface plays a role in hindering the accuracy acoustic detection, such as underwater exploration.
  • The experimental measurement is also conducive to the future development of studying quasiparticles with topological property in phononic crystals which might be difficult to perform in other systems.


  • The research not only has its significance in basic science but may find applications in on-chip logic devices, acoustic signal processing and sound energy harvesting.
  • The research findings might also benefit the biomedical devices.
  • It may help to improve the accuracy of ultrasound penetration through obstacles and reach designated targets such as tissues or organs, which could improve the ultrasound precision for better diagnosis and treatment.

-Source: The Hindu



The Wetlands International (South Asia) and the forest department is set to begin the annual waterbird census across Noida’s wetlands.


Prelims, GS-III: Environment and Ecology

Dimensions of the Article:

  1. What is Asian Waterbird Census (AWC)?
  2. Recently in News: Bar-headed Goose

What is Asian Waterbird Census (AWC)?

  • The Asian Waterbird Census (AWC) is an international programme that focuses on monitoring the status of water birds and wetlands.
  • The Asian Waterbird Census (AWC) is part of the global International Waterbird Census (IWC).
  • AWC aims to increase public awareness on issues related to wetland and water bird conservation.
  • In India, the AWC is annually coordinated by the Bombay Natural History Society (BNHS) and Wetlands International.
  • Asian Waterbird Census is a part of the global project ‘International Waterbird Census Programme’ and is carried out every year in January.
  • Any wetland which consistently holds 1% or more of water birds can be qualified as a wetland of international importance under the Ramsar Convention. Hence, statement 2 is correct.

Recently in News: Bar-headed Goose

  • A Bar-headed Goose had been spotted in the wetlands of Karingali Puncha in Kerala.
  • In general, large flocks visit the Koonthankulam bird sanctuary at Tirunelveli in Tamil Nadu. It is very rare that the bird is spotted in Kerala.
  • The wetlands of Karingali Puncha is a major birding spot in the district. It reported the highest bird count in the Asian Waterbird Census of 2015.

-Source: Hindustan Times



Assam administration has prohibited community fishing at Deepor Beel, a wetland on the south-western edge of Guwahati and Assam’s only Ramsar site.


GS-III: Environment and Ecology (Protected Sites, Conservation of Ecosystem)

Dimensions of the Article:

  1. About Deepor Beel
  2. What is a Ramsar Site?
  3. Ramsar Convention
  4. India and Ramsar sites

About Deepor Beel

  • Deepor Beel is located to the south-west of Guwahati city, in Kamrup district of Assam, India.
  • It is a permanent freshwater lake, in a former channel of the Brahmaputra River, to the south of the main river.
  • Deepor Beel was designated a Ramsar site in 2002 for sustaining a range of aquatic life forms besides over 200 species of birds.
  • The Area of Deepor Beel wetland has shrunk by at least 35% since 1991.
  • One of the reasons the wetland is in a precarious state is that it is losing connectivity with small rivers like Kalmoni, Khonajan and Basistha that used to flow via the Mora Bharalu channel through Guwahati.
  • Expansion of the city, encroachment upon the natural channels through Guwahati and from the hills around, and a municipal waste dump at Boragaon almost on the edge of the wetland were the other factors.

What is a Ramsar Site?

  • A Ramsar site is a wetland site designated to be of international importance under the Ramsar Convention.
  • Ramsar sites are recorded on the List of Ramsar wetlands of international importance.
  • The Ramsar Classification System for Wetland Type is a wetland classification developed within the Ramsar Convention intended as a means for fast identification of the main types of wetlands for the purposes of the Convention.
  • The countries with most sites are the United Kingdom with 175 and Mexico with 142.
  • And, the country with the greatest area of listed wetlands is Bolivia.

Ramsar Convention

  • The Ramsar Convention on Wetlands of International Importance especially as Waterfowl Habitat is an international treaty for the conservation and sustainable use of wetlands.
  • It is named after the city of Ramsar in Iran, where the Convention was signed in 1971.
  • The 2nd of February each year is World Wetlands Day, marking the date of the adoption of the Convention on Wetlands.
  • The Convention’s mission is “the conservation and wise use of all wetlands through local and national actions and international cooperation, as a contribution towards achieving sustainable development throughout the world”.
  • Every three years, representatives of the Contracting Parties meet as the Conference of the Contracting Parties (COP), the policy-making organ of the Convention which adopts decisions (Resolutions and Recommendations) to administer the work of the Convention and improve the way in which the Parties are able to implement its objectives.

India and Ramsar sites

Ashtamudi WetlandKerala
Beas Conservation ReservePunjab
Bhitarkanika MangrovesOdisha
Bhoj WetlandsMadhya Pradesh
Chandra TaalHimachal Pradesh
Chilika LakeOdisha
Deepor BeelAssam
East Kolkata WetlandsWest Bengal
Harike WetlandsPunjab
Hokera WetlandJammu & Kashmir
Kanjli WetlandPunjab
Keoladeo National ParkRajasthan
Keshopur-Miani Community ReservePunjab
Kolleru lakeAndhra Pradesh
Loktak lakeManipur
Nalsarovar Bird sanctuaryGujarat
Nandur MadhameshwarMaharashtra
Nangal Wildlife SanctuaryPunjab
Nawabganj Bird SanctuaryUttar Pradesh
Parvati Agra Bird SanctuaryUttar Pradesh
Point Calimere Wildlife and Bird SanctuaryTamil Nadu
Pong Dam lakeHimachal Pradesh
Renuka lakeHimachal Pradesh
Ropar WetlandPunjab
Rudrasagar LakeTripura
Saman Bird SanctuaryUttar Pradesh
Samaspur Bird SanctuaryUttar Pradesh
Sambhar lake Rajasthan
Sandi Bird SanctuaryUttar Pradesh
Sarsai Nawar JheelUttar Pradesh
Sasthamkotta lakeKerala
Surinsar- Mansar lakesJammu & Kashmir
TsomoririJammu & Kashmir
Upper Ganga riverUttar Pradesh
Vembanad Kol WetlandKerala
Wular lakeJammu & Kashmir
Sunderban WetlandWest Bengal
Asan Conservation ReserveUttarakhand
Kabartal WetlandBihar

-Source: The Hindu

June 2024