Current Affairs 13 February 2024

Contents:

1. Bio-Diversity Heritage site
2. Law Commission’s report to deal with future epidemics
3. SC on Maintenance for Divorced Muslim woman
4. India-UAE relations
5. RBI suggests to Lower borrowings to boost growth, ease inflation
6. Establishing real-time payment link between India and US

Bio-Diversity Heritage Site

Context:

The Gupteswar Forest in Odisha was recently decalared as Bio-Diversity Heritage site.

Relevance:

GS III: Environment and Ecology

Dimensions of the Article:

1. Details
2. About Gupteswar Forest
3. About Biodiversity heritage site

Details:

• The State Government of Odisha has recently declared the pristine Gupteswar Forest, in Odisha’s Koraput district as a Biodiversity heritage site.
  • This is the fourth Biodiversity-Heritage Site ( BHS) of the state.
• Significance:
  • The designation of Gupteswar as BHS will boost the cultural attachment of people with this forest will also lead to the conservation of its precious biodiversity.  
  • Consequently, the state government has asked the Odisha Biodiversity Board to prepare a long-term plan for intensive conservation and development of these sites through direct participation of the local communities.
  • This forest in the long run would add to the livelihood of the people through eco-tourism and minor forest produce.

About Gupteswar Forest:

• The forest is spread over 350 hectares of demarcated area.
• Along with its sacred grooves traditionally worshipped by the local community, the site is bestowed with a wide range of flora and fauna.
• As per the Biodiversity inventory and survey conducted by the Odisha Biodiversity Board, the site shows the presence of various types of mammals, birds, amphibian, reptiles, pices, butterflies, moths and many more.
• The site also has a rich floral diversity embracing many varieties of trees, shrubs, herbs, climbers and so on.

About Biodiversity heritage site

• BHS are areas that are unique, ecologically fragile ecosystems – terrestrial, coastal, inland and marine waters – having a rich biodiversity.
• The biodiversity comprises any one or more of the components like,
  • Species richness – Wild and domesticated species or intra-specific categories,
  • High endemism,
  • Presence of rare, endemic and threatened species, keystone species, species of evolutionary significance,
  • Presence of wild ancestors of domestic/cultivated species or landraces or their varieties,
  • Past pre-eminence of biological components represented by fossil beds and having cultural or aesthetic values.
  • Area with significant cultural, ethical or aesthetic values; important for the maintenance of cultural diversity

As per Section 37 of the Biological Diversity Act, 2002,

• State Governments can notify in the official gazette, in consultation with ‘local bodies’, areas of biodiversity importance as BHS.
• State Government in consultation with the Central Government may frame rules for the management and conservation of BHS.
• State Governments can frame schemes for compensating or rehabilitating anyone economically affected by such notification.

State Biodiversity Boards (SBB) may invite suggestions for the declaration of BHSs, through the Biodiversity Management Committees (BMCs) and other relevant community institutions.

-Source: The Indian Express, The Hindu

Law Commission’s Report To Deal With Future Epidemics

Context:

The Law Commission of India has recently submitted its Report titled “A Comprehensive Review of the Epidemic Diseases Act, 1897″ to the Government of India.

Relevance:

GS II: Polity and Governance

Dimensions of the Article:

1. Details of the Law Commission’s report
2. Drawbacks of Epidemic Diseases Act, 1897 (EDA):
3. Key suggestions made by the Law Commission:
4. Epidemic Diseases Act, 1897
5. Section 2 of Epidemic Diseases Act
6. Background to the Law Commission in India
7. About the Law Commission of India

Details of the Law Commission’s report:

• The 286th Law Commission Report recommended creation of an Epidemic Plan and Standard Operation Procedure to address future epidemics.
• After the Covid-19 outbreak, the Law Commission suo moto decided to thoroughly examine the existing legal framework to tackle the “significant deficiencies in addressing the containment and management of future epidemics in the country.
• The report highlighted the presence of uncoordinated responses among the Centre, state, and local authorities during an epidemic as there is no clear demarcation of powers between them.

Drawbacks of Epidemic Diseases Act, 1897 (EDA):

• The report brought out the limitations of the Epidemic Diseases Act, 1897 (EDA).
  • It states that-“the management, control and prevention of epidemic diseases cannot be restricted to a century-old law.”
    • The report claims that as a colonial-era legislation, the EDA has great potential for abuse. 
  • It was not designed to combat modern issues with the spread of infectious diseases.
  • Why there is a need for the change?
    • In a globalised and highly connected world, there are high chances of an infectious diseases rapidly turning into epidemics or pandemics.

Key suggestions made by the Law Commission:

• It seeks to make comprehensive recommendations for the amendment of the EDA or the introduction of a new law altogether.
• It suggested the creation of an Epidemic Plan and a Standard Operating Procedure to address the spread of infectious diseases.
  • This ensures that the powers and obligations of different levels of government are clearly demarcated which in turn leads to coordinated response during public health emergency.
  • The report specifies that the duty to create an Epidemic Plan falls on the Central government and the report recommends doing so in collaboration with state governments and after consulting the ministries concerned, private health institutions, expert bodies and other stakeholders.
• The EDA must be amended to ensure that the Epidemic Plan is prepared, enforced, and revised at regular intervals.
• The plan should include provisions on quarantine, isolation, and lockdowns, while ensuring that the measures are implemented fairly, without violating the fundamental rights of citizens.
• The EDA must contain provisions on
  • Privacy-friendly disease surveillance,  
  • Regulating the distribution,
  • Availability and transport of medical supplies,
  • Proper dissemination of information to the public,
  • Medical testing and research for vaccinations and medicines, and
  • Safe disposal of infectious waste

Epidemic Diseases Act, 1897

• The Epidemic Diseases Act, 1897 is a law which was first enacted to tackle bubonic plague in Bombay state in former British India.
• The law is meant for containment of epidemics by providing special powers that are required for the implementation of containment measures to control the spread of the disease.
• The Act has been routinely used to contain various diseases in India such as swine flu, cholera, malaria and dengue.

Section 2 of Epidemic Diseases Act

2. Power to take special measures and prescribe regulations as to dangerous epidemic disease

(1) When at any time the [State Government] is satisfied that [the State] or any part thereof is visited by, or threatened with, an outbreak of any dangerous epidemic disease, the [State Government], if [it] thinks that the ordinary provisions of the law for the time being in force are insufficient for the purpose, may take, or require or empower any person to take, such measures and, by public notice, prescribe such temporary regulations to be observed by the public or by any person or class of persons as [it] shall deem necessary to prevent the outbreak of such disease or the spread thereof, and may determine in what manner and by whom any expenses incurred (including compensation if any) shall be defrayed.

3. Penalty.

Any person disobeying any regulation or order made under this Act shall be deemed to have committed an offence punishable under section 188 of the Indian Penal Code (45 of 1860).

4. Protection to persons acting under Act.

No suit or other legal proceeding shall lie against any person for anything done or in good faith intended to be done under this Act.

Background to the Law Commission in India

• Law Reform has been a continuing process particularly during the last 300 years or more in Indian history. In the ancient period, when religious and customary law occupied the field, the reform process had been ad hoc and not institutionalised through duly constituted law reform agencies.
• However, since the third decade of the nineteenth century, Law Commissions were constituted by the Government from time to time and were empowered to recommend legislative reforms to clarify, consolidate and codify particular branches of law where the Government felt the necessity for it.
• The first such Commission was established in 1834 under the Charter Act of 1833 under the Chairmanship of Lord Macaulay which recommended codification of the Penal Code and the Criminal Procedure Code.
• After independence, the Constitution stipulated the continuation of pre-Constitution Laws under Article 372 until they are amended or repealed.
• The Government of India established the First Law Commission of Independent India in 1955 and since then twenty-one more Law Commissions have been appointed, each with a three-year term.

About the Law Commission of India

• Law Commission of India it is an executive body established by an order of the Government of India.
• The Commission is established for a fixed tenure and works as an advisory body to the Ministry of Law and Justice.
• Its major function is to work for legal reforms and its membership primarily comprises legal experts.

Functions of the Law commission

• The Law Commission, on a reference made to it by the Central Government or suo-motu, undertakes research in law and review of existing laws in India for making reforms therein and enacting new legislations.
• It also undertakes studies and research for bringing reforms in the justice delivery systems for elimination of delay in procedures, speedy disposal of cases, reduction in the cost of litigation etc.
• Identification of laws which are no longer relevant and recommending for the repeal of obsolete and unnecessary enactments, and giving suggestions for enactment of new legislation as may be necessary to implement the Directive Principles and to attain the objectives set out in the Preamble of the Constitution is also a part of the Law Commission’s functions.
• It also conveys to the Government its views on any subject relating to law and judicial administration that may be specifically referred to it by the Government.
• The recommendations of the commission are not binding on the government.

-Source: The Indian Express

SC on Maintenance for Divorced Muslim Woman

Context:

Recently, the Supreme Court appointed a senior advocate as the amicus curiae for the matter concerned with the maintenance of Muslim women.

• The court will deal with the question of whether a Muslim women be entitled to claim maintenance from her divorced husband under the Code of Criminal Procedure, 1973 — as was affirmed in the Shah Bano case or under The Muslim Women (Protection of Rights on Divorce) Act, 1986

Relevance:

GS Paper 2: Historical underpinnings & evolution; Features, amendments, significant provisions, basic structure; Comparison of Indian constitutional scheme with other countries’

Dimensions of the Article:

1. What are Alimony and Maintenance?
2. Laws related to Alimony and Maintenance in India.
3. Issues related to Alimony and Maintenance in India.
4. The Supreme Court’s guidelines regarding alimony
5. way forward

What are the Alimony and Maintenance?

Alimony and maintenance both connote the existence of a duty on the part of one person to provide for the needs of another person or persons who are dependent on them.

• Interim maintenance: While the legal proceedings are still underway, a husband is required to pay maintenance for the wife, along with the expenses of the proceedings. The interim maintenance is payable from the date the petition is filed, till the time the final order is passed.
• Permanent maintenance:  When a decree of dissolution of marriage or judicial separation is obtained by the wife, the court may order that the husband shall pay the wife any particular amount fixed by the court, either periodically.

Laws related to Alimony and Maintenance in India:

Our country comprises different communities, and each community has its own personal laws derived from religious scriptures, customs and traditions.

• Hindu woman can seek divorce and alimony may not be the same for every other community. The Hindu community is governed by The Hindu Marriage Act, 1955 and the Hindu Adoption and Maintenance Act, 1956, which grant the right to women to claim maintenance. Under Hindu laws, the quantum of maintenance amount is based on several factors like husband’s financial income, assets, liabilities, wife’s employment and earning status etc.
• Under Muslim personal law, the wife can claim compensation through Muslim Women (Protection of Rights on Divorce) Act, 1986.
• Divorced Christian women can claim maintenance under the Indian Divorce Act, 1869. The Act prescribes one-fifth of the husband’s income as the maximum maintenance amount.
• The Parsi Marriage and Divorce Act, 1936 provides the right of a wife to claim maintenance from her husband as one of the rights of wife after divorce in India, while in the case of inter-caste marriage it is governed by Special Marriage Act, 1954.

Section 125 of the Code of Criminal Procedure, 1973, which applies to all communities lays down the provision for maintenance of wives, children, and parents if they do not earn enough and reasonable means to maintain themselves, or suffer from any physical or mental incapacity. Under this section, even a wife who has not divorced her husband has the right to get maintenance from her husband.

Issues related to Alimony and Maintenance in India:

• Maintenance and alimony is the only source of livelihood hence discrimination on the basis of religion, race, caste, sex or place of birth is a direct attack on the right to life, liberty and dignity, guaranteed under Article 21 of the Constitution.
• The discriminatory maintenance and alimony reinforce patriarchal and stereotypical notions about women and thus any provision that perpetrates or reinforces discriminatory stereotypes against women is manifestly arbitrary.
• All the women don’t have equal rights related to alimony in India which violate their right to equality as a fundamental rights under Indian constitution.
• In India, the women are much vulnerable due to patriarchal attitude of society towards women therefore, there should be clarity regarding alimony so that women can live dignified life.
• Most of the girls in India get marry at early age and if they get divorce then proper alimony is needed to sustain their life.
• In India, judicial proceedings take long time and require enough money therefore interim maintenance is needed.
• Even after 73 years of Independence and 70 years of India becoming a socialist secular democratic republic, laws relating to maintenance and alimony are not only complex and cumbersome but also against the constitutional mandate of being equal, rational and just.
• The discriminatory grounds of maintenance and alimony are violative of Articles 14, 15, 21 of the Constitution.

The Supreme Court’s guidelines regarding alimony

Article 15(3), which states ‘nothing in this article shall prevent the State from making any special provision for women and children’, read together with Article 39, which directs state policy towards equal pay and opportunities for both men and women, and protecting the health of women and children, are two key constitutional safeguards. The Supreme Court leaned on these two Articles, and a host of other laws, and set down comprehensive guidelines on alimony.

• The right to claim maintenance under all enactments, including those under Section 125 of the CrPC, must date back to filing of the application.
• “Financial constraints of a dependent spouse hamper their capacity to be effectively represented before the court. In order to prevent a dependant from being reduced to destitution, it is necessary that maintenance is awarded from the date on which the application for maintenance is led before the court concerned,” a Bench headed by Justice Indu Malhotra said.
• The delay in adjudication is not only against human rights, but also against the basic embodiment of dignity of an individual.
• While women can make a claim for alimony under different laws, including the Protection of Women from Domestic Violence Act, 2005 and Section 125 of the CrPC, or under the Hindu Marriage Act, 1955, it “would be inequitable to direct the husband to pay maintenance under each of the proceedings”, urging civil and family courts to take note of previous settlements.

Way forward

The recent guidelines of the Supreme Court related to alimony will improve the status of women and provide them sense of security and justice. They can live dignified life. However, these guidelines must be implemented at ground level.

-Source: The Indian Express

India-UAE Relations

Context:

The Prime Minister of India will be on a two-day visit to the United Arab Emirates (UAE) to hold bilateral meeting with the President of the UAE.

• The meeting is to discuss ways to further deepen, expand, and strengthen the strategic partnership between the countries and exchange views on regional and international issues of mutual interest.
• The PM will also participate in the World Government Summit 2024 to be held in Dubai and deliver a special keynote address at the Summit.

Relevance:

GS Paper 2: Important Bilateral Agreements

Dimensions of the Article:

1. Bilateral Relationship between India and the UAE
2. Commercial Relationship
3. India and the UAE have signed a Comprehensive Economic Partnership Agreement (CEPA)
4. Investment
5. Remittances from Non-Resident Indians
6. Cooperation in Energy
7. The Next Steps

Bilateral Relationship between India and the UAE

• India and the United Arab Emirates established diplomatic relations in 1972. Their bond has grown exponentially since then.
• In January 2017, India and the United Arab Emirates signed a Comprehensive Strategic Partnership Agreement.
• The exchange of high-level visits by both sides has given impetus to the strong bilateral relations.
  • In February 2019, the UAE invited India to address the Organization of Islamic Cooperation’s Inaugural Plenary 46th Session as the “Guest of Honour.”
  • In August 2019, Prime Minister Modi paid his third visit to the UAE. He received the UAE’s highest civilian award, the ‘Order of Zayed.’
  • In January 2017, the Crown Prince of the UAE visited India for the second time as the Chief Guest at India’s Republic Day celebrations.
• In April 2019, the foundation stone for Abu Dhabi’s first traditional Hindu Temple was laid.
• PM Modi and Crown Prince of Abu Dhabi HH Sheikh Mohammed bin Zayed Al Nahyan held a virtual summit in February 2022.
  • Both leaders issued a Joint Vision Statement titled “Advancing India and the UAE’s Comprehensive Strategic Partnership: New Frontiers, New Milestones.”

Commercial Relationship

• Until FY20, the UAE was India’s second-largest goods export market, trailing only the US. When the pandemic caused severe trade disruptions in FY21, China pipped it.
• The UAE is currently India’s third-largest trading partner, with bilateral trade worth $59 billion in FY20.
• In addition, the UAE is India’s second-largest export destination after the United States (approximately $29 billion in FY20).

India and the UAE have signed a Comprehensive Economic Partnership Agreement (CEPA)

• Both countries have begun negotiations for a mutually beneficial CEPA in September 2021.
• The India-UAE CEPA was signed in New Delhi in February 2022 during the India-UAE Virtual Summit.
  • India announced the signing of the CEPA with the UAE in March 2022.
• Coverage
  • It covers almost all of India’s (11,908 tariff lines) and the UAE’s tariff lines (7581 tariff lines)
• Priority access to goods
  • CEPA establishes an institutional mechanism to encourage and improve bilateral trade.
  • India will benefit from the UAE’s preferential market access on over 97% of its tariff lines, accounting for 99% of Indian exports to the UAE in value terms.
  • India will also grant the UAE preferential access to over 90% of its tariff lines, including those of export interest to the UAE.
• Services Trade
  • India has offered the UAE market access in approximately 100 sub-sectors.
  • Indian service providers, on the other hand, will have access to approximately 111 sub-sectors from the 11 broad service sectors.
  • Both parties have also agreed to a separate Pharmaceutical Annex to facilitate access to Indian pharmaceuticals
• For the first time, a separate section of pharma has been created to facilitate the export of Indian generic medicines.

Investment

• The UAE is India’s eighth-largest investor, with $11 billion invested between April 2000 and March 2021.
• Indian companies are expected to invest more than $85 billion in the UAE.

Remittances from Non-Resident Indians

• The annual remittances made by the UAE’s large Indian community (estimated at around 3.3 million) total US$ 17.56 billion in 2018.

Cooperation in Energy

• In 2017, the Abu Dhabi National Oil Company (ADNOC) and the Indian Strategic Petroleum Reserves Ltd. (ISPRL) signed a Memorandum of Understanding (MOU) to establish a strategic crude oil reserve in Mangalore (Karnataka).
• In addition, ADNOC is investigating the possibility of storing its crude oil at ISPRL’s underground oil storage facility in Padur, Karnataka.
• The Lower Zakum Concession has been awarded to a consortium led by ONGC, which includes Indian Oil and Bharat Petro Resources.

The Next Steps

• Benefits of India-UAE Trade Agreements: With India’s newfound export strength, a trade agreement with a major country like the UAE would help sustain the growth momentum.
• As the manufacturing sector recovers, the UAE would be an appealing export market for Indian electronics, automobiles, and other engineering products.
• Because the UAE and India are both aggressively pursuing FTAs with a number of important countries, not only companies from these two countries but also MNCs from other geographies would find the UAE and India to be appealing markets to invest in.
• Creating a Foundation for Better Relations with the GCC: The UAE is a signatory to several regional and bilateral free trade agreements, including those with GCC countries.
• As a member of the GCC, the UAE has strong economic ties with Saudi Arabia, Kuwait, Bahrain, and Oman, with whom it shares a common market and customs union.
• The UAE has free trade access to Saudi Arabia, Kuwait, Bahrain, Qatar, Oman, Jordan, Egypt, Iraq, Lebanon, Morocco, Tunisia, Palestine, Syria, Libya, and Yemen under the Greater Arab Free Trade Agreement (GAFTA).
• This FTA with the UAE will allow India to enter the UAE’s strategic location and have relatively easy access to the Africa market and its various trade partners, allowing India to become a part of that supply chain, particularly in handlooms, handicrafts, textiles, and pharmaceuticals.
• Compliance with UAE NTBs: Because the UAE tariff structure is bound with the GCC (the applied average tariff rate is 5%), addressing Non-Tariff Barriers (NTBs) becomes critical.
• Non-Tariff Measures (NTMs), which are mostly covered by Sanitary and Phytosanitary (SPS) and Technical Barriers to Trade, are a reflection of NTBs (TBT).
• The SPS notifications primarily concern live poultry, meat, and processed food, whereas the TBT notifications concern fish, food additives, meat, rubber, electrical machinery, and so on. These regulations present a challenge to Indian exporters.
• The FTA agreement must strive to increase transparency and predictability in the use of NTBs, making compliance easier.

-Source: The Indian Express

RBI Suggests to Lower Borrowings to Boost Growth, Ease Inflation

Context:

Recently, the Reserve Bank of India (RBI) said that lower borrowings  to increase growth and ease inflation.

• Lower government borrowings will ensure more space for resources to be available in the banking system to help private sector investments and stabilise inflation.

Relevance:

GS Paper-3: Indian Economy and issues relating to planning, mobilization of resources, growth, development, and employment

Dimensions of the Article:

1. Public Debt in India
2. Sources of Public Debt
3. Fiscal Deficit
4. THE THREE PILLARS FOR REDUCING PUBLIC DEBT:
5. Parameters Determining Public Debt
6. What should be done right away?
7. Conclusion

Public Debt in India

• The total obligations of the Union government that must be settled out of the Consolidated Fund of India are referred to as public debt in India.
• The term is occasionally also used to describe the total debt owed by the federal and state governments.
  • But the Union government makes a point of separating its debt obligations from those of the states. General Government Debt (GGD) or Consolidated General Government Debt is the term used to describe the total liabilities of both the federal government and state governments. These obligations are categorised as part of the Union government’s public debt by the Consolidated Fund of India. According to Constitutional Article 292, this is the case.
• Internal loans, which make up the majority of public debt in India, are further divided into two main categories: marketable and non-marketable debt. Internal loans account for more than 93% of the country’s total public debt.
• Marketable debt includes dated government securities (G-Secs) and treasury bills (T-bills), both of which are issued through auctions.
• Non-marketable debt includes special securities issued to the National Small Savings Fund (NSSF), intermediate treasury bills (with a 14-day maturity period) issued to state governments and public sector banks, and other types of debt.

Sources of Public Debt

• include: Treasury Bills, Foreign Assistance, Dated Government Securities (G-secs), Short-Term Borrowings, and T-Bills.
• Definition of Public Debt by Union Government
• The effects of a high public debt ratio include:
• Three main effects of a high public debt ratio on macroeconomic policy over the medium term.
  • The government has less money to spend on necessary things like infrastructure, the transition to a green economy, welfare programmes, defence, and social security due to the interest costs of servicing this public debt.
  • Second, when the public debt ratio is already high, the government’s capacity to respond to the ensuing shock is constrained.
• Third, the government’s massive public debt burden compromises the Reserve Bank of India’s ability to implement an independent monetary policy to control inflation.
• Therefore, fiscal policy should aim to reduce the public debt ratio to more manageable levels over the remainder of this decade.
  • As the pandemic threat has subsided and the economy has recovered, more attention needs to be paid to gradually reducing the public debt ratio over the remainder of this decade.

Fiscal Deficit

• The difference between total receipts into the fund (excluding debt receipts) and total disbursements from the Consolidated Fund of India during a fiscal year is known as the fiscal deficit.
  • To put it simply, it is the amount of government spending that exceeds its revenue and is expressed as a percentage of GDP.
• Total expenditure minus revenue receipts minus capital receipts minus borrowings equals the fiscal deficit.
  • The term “fiscal consolidation” describes strategies for reducing the fiscal deficit.

THE THREE PILLARS FOR REDUCING PUBLIC DEBT:

• Any plan to lessen the weight of public debt must be based on these three pillars, according to the economics of public debt dynamics:
• One, by ensuring that the denominator is growing faster than the numerator, an acceleration in nominal GDP growth can reduce the public debt ratio.
  • Second, the acceleration in nominal GDP growth needs to be viewed in relation to the average cost of government borrowing; the difference between the two (r-g) should be interpreted as a measure of how quickly India can eliminate its public debt issue.
  • The primary deficit, or the gap in the government budget after interest costs on existing public debt are eliminated, will need to be reduced as part of fiscal policy, not just the headline fiscal deficit.

Parameters Determining Public Debt

• The trajectory of public debt over the coming years will depend on the expansion of economic output, inflation, interest rates, and fiscal policy, among other factors.
  • We have some helpful context thanks to the first ten years of this century.
• Between 2002-03 and 2010-11, the public debt ratio decreased by about 17 percentage points.
  • The primary deficit sharply decreased as a result of India’s spectacular growth acceleration, which made the first part successful.
• When the North American financial crisis reached Indian shores, this came to an end. Growth started to slow down, and the financial situation got worse.
  • However, despite fiscal mismanagement and high inflation, which resulted in a run on the rupee in the middle of 2013, the public debt ratio continued to decline because high inflation kept nominal GDP growth well above borrowing costs.

What should be done right away?

• Unless there is a structural shift in both potential growth and inflation, nominal GDP growth in the upcoming years is likely to be in the very low double digits, and the difference between interest rates and nominal GDP growth will also be modest. This implies that the automatic mechanisms for reducing the public debt ratio cannot accomplish the task by themselves.
• To reduce the primary deficit in the upcoming years, the government must use fiscal policy.

Conclusion

• The primary deficit necessary to stabilise the public debt ratio, according to the International Monetary Fund’s recent report on the Indian economy, is 2.3% of GDP.
• According to the Institute of International Finance’s deputy chief economist, assuming real growth of 5.5%, inflation of 4%, and average borrowing costs of 6.5% over the next financial year, India’s projected primary deficit is 1 percentage point higher than what is required for public debt stabilisation.
• India has done a good job of managing its public finances during these trying times, but in order to increase economic resilience going forward, the public debt ratio needs to at least reach pre-pandemic levels.

-Source: The Indian Express

Establishing Real-Time Payment Link Between India and US

Context:

The National Payments Corporation of India (NPCI) is set to establish real-time payment link between India and the US.

• The initiative aims to leverage NPCI’s expertise in cross-border payments

Relevance:

GS III: Indian Economy

National Payments Corporation of India (NPCI):

• Purpose:
  • Acts as an umbrella organization for managing retail payments and settlement systems in India.
• Initiative:
  • Established as a joint initiative of the Reserve Bank of India (RBI) and the Indian Banks’ Association (IBA) under the Payment and Settlement Systems Act, 2007.
• Legal Status:
  • Registered as a “Not for Profit” Company under Section 25 of the Companies Act 1956 (now Section 8 of the Companies Act 2013).
• Promoters:
  • Promoted by ten major banks, including the State Bank of India, Punjab National Bank, Citibank, Bank of Baroda, and HSBC.
• Regulatory Board:
  • Headquartered in Mumbai, it is governed by a regulatory board consisting of nominees from the RBI and ten core promoter banks.

-Source: The Indian Express, Hindustan Times