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Current Affairs for UPSC IAS Exam 31 December 2021 | Legacy IAS


  1. China renames 15 places in Arunachal Pradesh
  2. States demand extension of GST compensation for 5 years
  3. Throwing open dairy sector to Australia and opposition
  4. New scheme to support the marginalised

China renames 15 places in Arunachal Pradesh


China announced that it had standardised the names of 15 places in Zangnan  (the Chinese name for Arunachal Pradesh) in Chinese characters.


GS-II: International Relations (India’s Neighbors, Foreign Policies affecting India’s Interests)

Dimensions of the Article:

  1. About China’s “Standardized names” move
  2. Chinese claim over Arunachal Pradesh
  3. India and Arunachal Pradesh
  4. Why Arunachal Pradesh? What is China’s Interest In Arunachal Pradesh?
  5. The McMahon Line

About China’s “Standardized names” move

  • China’s Ministry of Civil Affairs announced that it had standardised in Chinese characters, Tibetan and Roman alphabet the names of 15 places in Zangnan, the Chinese name for Arunachal Pradesh. The standardisation is in accordance with regulations on geographical names issued by the State Council, China’s cabinet.
  • Among the official names of the 15 places, which were given precise coordinates, eight are residential areas, four are mountains, two are rivers, and one is a mountain pass.
  • This is the second batch of standardised names of places in Arunachal Pradesh given by China. The first batch of the standardised names of six places was released in 2017.

Chinese claim over Arunachal Pradesh

  • When the new Peoples Republic of China was formed in February 1912 after the abdication of the Qing emperor, the Tibetans asserted their independence.
  • They forced the Chinese troops based in Lhasa to return to the mainland-via India. A year later, Tibet declared independence from China.
  • In order to ensure that the unrest did not spread to India and assert their boundaries, the ruling British convened a tripartite meeting at Shimla with Tibetan and Chinese delegates to define the border.
  • The meeting gave China suzerainty over most of Tibet, and the boundary defined in this treaty was later known as the McMohan line.
  • The Chinese Foreign Ministry said that China’s “position on Zangnan or South Tibet, as China refers to Arunachal] region is consistent and clear. We never recognised the so-called Arunachal Pradesh.”

India and Arunachal Pradesh

  • Arunachal Pradesh (called South Tibet in China) is a full-fledged state of India.
  • India’s sovereignty over the area is internationally recognized and its residents have not shown any inclination to leave India.
  • The majority of the international maps acknowledge the area to be an Indian Territory.
  • China has some (pre-) historical claims through its ownership of Tibet, but the people and geography primarily favor India.

Why Arunachal Pradesh? What is China’s Interest In Arunachal Pradesh?

  • Arunachal Pradesh known as the North East Frontier Agency (NEFA) until 1972, is the largest state in the northeast and shares international borders with to the north and northwest, Bhutan towards the west and Myanmar to the east.
  • The state is like a protective shield to the northeast.
  • However, China claims Arunachal Pradesh as a part of southern Tibet.
  • And while China may lay claim to the entire state, its main interest lies in the district of Tawang, which is in the north-western region of Arunachal and orders Bhutan and Tibet. China’s interest in Tawang could be for tactical reasons as it provides a strategic entry into India’s northeastern region.
  • Tawang is a critical point in the corridor between Tibet and Brahmaputra Valley.

Tawang monastery issue

  • Besides Tawang also hosts the Tawang Ganden Namgyal Lhatse (Tawang Monastery), which is the second largest monastery of Tibetan Buddhism in the world.
  • The monastery was founded by Merag Lodroe Gyamtso in the year 1680-81 to honor the wishes of the 5th Dalai Lama.
  • China claims that the monastery is evidence that the district once belonged to Tibet. They cite historical ties between the Tawang monastery and the Lhasa monastery in Tibet to support their claim over Arunachal.
  • This despite the fact that the 1914 Simla convention, which included a Chinese representative on an equal footing with a Tibetan representative, gave birth to the McMahon Line separating Tibet from India in the eastern sector. It clearly defined the frontiers of the boundary between India and Tibet.

Cultural connections and China’s anxieties

  • Tawang is an important center of Tibetan Buddhism. There are some tribes in the upper Arunachal region which have cultural connections to the people of Tibet. The Monpa tribal population practices Tibetan Buddhism and are also found in some areas of Tibet.
  • According to some experts, China fears that the presence of these ethnic groups in Arunachal could at some stage give rise to a pro-democracy Tibetan movement against Beijing.

Political significance

  • When the Dalai Lama escaped Tibet in 1959 amid China crackdown, he entered India through Tawang and stayed in the Tawang monastery for some time.

The Bhutan factor

  • If Beijing were to gain control of Arunachal, it would mean that the kingdom of Bhutan would have China as its neighbour on both the western and eastern borders.

Infrastructure investments

  • China has already engaged in massive construction of motorable roads to connect strategic points on Bhutan’s western side. According to reports, China wants to extend its roads from Doka La to Gamochin, which is under the guard of the Indian army. China’s efforts to move closer to the Siliguri corridor is a security threat for both India and Bhutan.
  • What’s more, China is expanding its network of railway lines in the region which could give its military a huge advantage.

Strategic location of Arunachal Pradesh

  • Arunachal’s strategic location Arunachal Pradesh is the closest location for India to target China with missiles. Also, Arunachal is the best location for
  • India to deploy a multi-layered air defence system for possible attacks from China. Thus, control over Arunachal will give China a strategic advantage.

Water power

  • We all know China has control over India’s water supply to the northeastern region. It has constructed several dams and can use water as a geo-strategic weapon against India by causing flooding or drought in the region.
  • The Tsangpo river, which originates in Tibet, flows into India and is called Siang in Arunachal Pradesh before it becomes the Brahmaputra.

The McMahon Line

History behind it

  • British India annexed Assam in northeastern India in 1826, by Treaty of Yandabo at the conclusion of the First Anglo-Burmese War (1824–1826). After subsequent Anglo-Burmese Wars, the whole of Burma was annexed giving the British a border with China’s Yunan province.
  • In 1913–14, representatives of Britain, China, and Tibet attended a conference in Simla, India and drew up an agreement concerning Tibet’s status and borders. The McMahon Line, a proposed boundary between Tibet and India for the eastern sector, was drawn by British negotiator Henry McMahon on a map attached to the agreement.
  • All three representatives initialled the agreement, but Beijing soon objected to the proposed Sino-Tibet boundary and repudiated the agreement, refusing to sign the final map on the ground that Tibet was subordinate to China and had not the power to make treaties.
  • Chinese have maintained this position to the present day and also have claimed that Chinese territory extends southward to the base of the Himalayan foothills.
  • This frontier controversy with independent India led to the Sino-Indian hostilities of October–November 1962. In that conflict the Chinese forces occupied Indian territory south of the McMahon Line but subsequently withdrew after a cease-fire had been achieved.

India’s stand on McMahon Line

  • India believes that when the McMahon Line was established in 1914, Tibet was a weak but independent country, so it has every right to negotiate a border agreement with any country.
  • According to India, when the McMahon Line was drawn, Tibet was not ruled by China. Therefore, the McMahon Line is the clear and legal boundary line between India and China.
  • Even after the Chinese occupancy over Tibet in 1950, the Tawang region remained an integral part of India.

Current status on the McMahon Line

  • India recognizes the McMahon Line and considers it to be the ‘Actual Line of Control (LAC)’ between India and China, while China does not recognize the McMahon Line. China says that the area of the disputed area is 2,000 kilometers while India claims it is 4,000 kilometers.
  • This land dispute between India and China is in Tawang (Arunachal Pradesh), which China considers as the Southern part of Tibet. Whereas according to the Shimla Agreement it is a part of the Indian state Arunachal Pradesh.
  • Thus, it is clear that China rejects almost every treaty that it had approved before the communist revolution. This is true about the Panchsheel agreement also.

-Source: The Hindu

States demand extension of GST compensation for 5 years


Many states have demanded that the GST compensation cess regime be extended for another five years and the share of the Union government in the centrally-sponsored schemes be raised as the COVID-19 pandemic has impacted their revenues.


GS-III: Indian Economy (Taxation, Government Policies and Initiatives)

Dimensions of the Article:

  1. What is GST?
  2. What is GST Compensation Cess?
  3. Issue with GST Compensation Cess

What is GST?

GST is a destination-based indirect tax and is levied at the final consumption point. Under it, the final consumer of the goods and services bear the tax charged in the supply chain. GST is a transparent and fair system that prevents black money and corruption and promotes new governance culture.


  • Goods and Services Tax (GST) Act came into effect in 2017.
  • Goods and Services Tax (GST) was introduced by the Government of India to boost the economic growth of India. GST is considered to be the biggest taxation reform in the history of the Indian economy.
  • The power to make any changes in the GST law is in the hands of the GST Council. GST Council is headed by the Finance Minister. One hundred and first amendment act, 2016 introduced the GST in India in July 2017.

What is GST Compensation Cess?

GST was implemented through the GST (101st Amendment Act), 2016 as a long pending indirect tax reform. It is a single tax that replaces multiple other indirect taxes. The Centre lost out on its power to levy taxes such as excise duty, while the States could no longer levy entry tax, VAT etc. To allay the fears of States regarding loss of revenue, following mechanism was made:

GST (Compensation to States) Act, 2017 was enacted under which:

  • The percentage of annual revenue growth of a State has been projected to be 14%. If the annual revenue growth of a State is less than 14%, the State is entitled to receive compensation under the statute.
  • The compensation payable to a State shall be provisionally calculated and released at the end of every two months period.
  • The generation of revenue under the Act would happen through a GST Compensation Cess:
    • The cess comprises the cess levied on sin and luxury goods for five years.
    • The entire cess collected during the year is required to be credited to a non-lapsable Fund (the GST Compensation Cess Fund).
    • The collected compensation cess flows into the CFI and is then transferred to the Public Account of India, where the GST compensation cess fund has been created.

Issue with GST Compensation Cess

The issue arose when payments due for August-September 2019 were delayed. Since then, all subsequent payouts have seen cascading delays. The problem has aggravated and further compounded due to following reasons:

  • Persistent Economic Slowdown: The slowdown has impacted the demand and consumption levels and has thus dented the overall GST collections (both Centre and States).
  • Effect of the Pandemic: The pandemic has given an economic shock to the Indian Economy which has dented the tax collection expectations (including the collections from GST Compensation Cess) of both Centre and States.
  • Estimation of 14% revenue growth unrealistic: The high rate of 14%, which has compounded since 2015- 16, has been seen as delinked from economic realities. In the initial meetings of the GST Council, a revenue growth rate of 10.6% (the average all-India growth rate in the three years preceding 2015-16) was proposed but 14% revenue growth was accepted “in the spirit of compromise”.

As a result of these issues, the stalemate reached at a point where States were looking at the GST shortfall of Rs. 30,000 crore and the Centre being in no position to provide for it.

-Source: The Hindu

Throwing open dairy sector to Australia and opposition


Indian farmers will oppose the Comprehensive Economic Cooperation Agreement (CECA) between India and Australia if it throws open the country’s dairy sector for Australian dairy majors, the Bharatiya Kisan Union (BKU) has said.

  • India and Australia have been in discussion for concluding a Comprehensive Economic Cooperation Agreement (CECA) by the end of 2022.


GS-III: Agriculture, GS-III: Indian Economy

Dimensions of the Article:

  1. Dairy Sector in India
  2. Significance of the Dairy Sector in India
  3. Associated Issues
  4. Disadvantages of opening up of India’s dairy sector

Dairy Sector in India

  • India is the world’s largest milk producer, with 22 percent of global production, followed by the United States of America, China, Pakistan and Brazil. (
  • It is a source of income to small and landless agri-households and 70% of those earning their livelihood from milk are women.
  • In the Gross Value Added (GVA) from agriculture, the livestock sector contributed 28 percent in 2019-20. Further, India witnesses a 6% growth rate in milk production every year.
  • The dairy sector serves a wide range of consumer needs too – from protein supplements and health foods to indulgence foods such as yogurt and ice creams.
  • Small and marginal farmers own 33% of land and about 60% of female cattle and buffaloes.
  • Dairying is a part of the farming system, not a separate enterprise. Feed is mostly residual from crops, whereas cow dung is important for manure.
  • Dairying provides a source of regular income, whereas income from agriculture is seasonal. This regular source of income has a huge impact on minimizing risks to income. There is some indication that areas where dairy is well developed have less incidence of farmer suicide.
  • Organizations like Amul, Mother Dairy, Kwality Limited, etc. have played a pivotal role in expanding the production. Amul today has over 3.6 million milk producers nationwide.
  • Further, there has been a proliferation of private dairy enterprises that now account for more than 60 % of dairy processing capacity in the country.

Significance of the Dairy Sector in India

  • Farmers keep 2-5 milk animals for livelihood. They provide great support to them, especially during drought and flood. Further, dairying is not a seasonal occupation in nature, like agriculture.
  • The milk and associated products have immensely helped India in reducing the malnutrition and undernourishment levels in the country. Thus, the dairy sector is indispensable for meeting the nutritional requirement of the country’s rising population.
  • It is a significant contributor to farmers’ income as approximately 70 million farmers are directly involved in dairying.
  • Operation Flood (also called as White Revolution) converted India from a milk importer to the world’s largest producer. The program launched in 1970 and adopted a multi-pronged approach. This included tax incentives, food quality standards, subsidies on inputs, infrastructure provisions such as cold chain and electrification. All this helped in reducing import bills and made India an exporter. The country exported dairy products worth $187 Million in 2019-20. 
  • Female population comprises around 69% of the sector’s workforce. They are dependent on the sector for their livelihood. Therefore, the dairy sector’s development automatically augments women’s empowerment.
  • The dairy sector provides cow dung which is used as an organic manure for the agricultural sector. Further, the sector provides raw materials to manufacture processed foods. For instance, the whey protein powder is an extract from the watery portion of milk that separates from the curds during the cheese-making process.

Associated Issues

  • Farmers keep two to five in-milk animals for livelihood. In this setup, unpaid female family labour supplies a major part of the labour requirement for milk production. The landless and marginal farmers among them have no livelihood options to fall back when they fall short of buyers for milk.
  • Unlike sugarcane, wheat, and rice-producing farmers, cattle raisers are unorganised and do not have the political clout to advocate for their rights.
  • Though the value of milk produced outweighs the combined value of the output of wheat and rice in India, there is no official and periodical estimate of the cost of production and Minimum Support Price for milk.
  • Even though dairy cooperatives handle about 40 percent of the total marketable surplus of the milk in the country, they are not a preferred option of landless or small farmers. This is because more than 75 percent of the milk bought by dairy cooperatives is at its lower price band.

Disadvantages of opening up of India’s dairy sector

  • The opening up of the dairy sector to foreign dairy majors could result in the flooding of cheap dairy imports into India. As a result, its impact on Indian dairy product prices would be significant and this will definitely undermine the domestic players in the sector.
  • The private milk companies would find it far more profitable to import milk from Australia or New Zealand rather than buy it from Indian farmers. In such a scenario, the sale price of milk received by Indian farmers would fall sharply.
  • The government policy in countries like Australia has consciously helped their major dairy companies become major global players. On the contrary, India’s dairy sector is composed predominantly of small producers. This unequal competition will only undermine the operations of the Indian domestic players.
  • India’s dairy sector provides livelihood to about 70 million households. Many small farmers are dependent on dairy work and opening the sector to foreign countries like Australia will hurt millions of farmers and dairy workers.
  • As against the argument that India would soon become a milk-deficient country and be forced to import milk and it stands to gain from cheap dairy imports from countries like Australia, forecasts from Niti Aayog show that this argument is wrong. India’s contribution to world milk production stands at 20% in 2018. As per the available estimates, in 2033, India’s milk production would rise to 330 MMT while its milk demand would be 292 MMT (India is likely to be a milk-surplus country by 2033). Hence, India is self-sufficient in milk production and will continue to be so in the coming years as well. The influx of cheap dairy imports is not necessary for meeting the dairy needs in the domestic market.
  • Having opted out of the RCEP [Regional Comprehensive Economic Partnership] deal over fears of the Indian dairy sector being overwhelmed by dairy majors of countries like Australia and New Zealand, the move to have a bilateral Free Trade Agreement with an RCEP member like Australia would have the same adverse impact on India’s dairy sector.

-Source: The Hindu

New scheme to support the marginalised


A scheme for rehabilitation of persons engaged in begging and for providing support to transgender persons was expected to be launched soon, according to a statement by the Union Social Justice and Empowerment Ministry.


GS-II: Social Justice and Governance (Government Policies and Initiatives, Welfare Schemes, Issues related to Minorites)

Dimensions of the Article:

  1. Social Justice and Empowerment Ministry’s statements
  2. SMILE – Support for Marginalized Individuals for Livelihood and Enterprise
  3. Nasha Mukt Bharat Abhiyaan (NMBA)

Social Justice and Empowerment Ministry’s statements

  • The Ministry said it had formulated an umbrella scheme, SMILE (Support for Marginalised Individuals for Livelihood and Enterprise), that included two sub-schemes for the welfare of transgender persons and persons engaged in begging.
  • The scheme will cover rehabilitation, provision of medical facilities, counselling, education, skill development and economic linkages.
  • As a part of the national anti-drug campaign, the Nasha Mukt Bharat Abhiyan that was launched in 2020, the Ministry said it had planned to declare 100 districts as “drug sensitised districts” soon.

SMILE – Support for Marginalized Individuals for Livelihood and Enterprise

  • SMILE – Support for Marginalized Individuals for Livelihood and Enterprise is a new Scheme after the merger of existing Schemes for Beggars and Transgenders – which provides for the use of the existing shelter homes available with the State/UT Governments and Urban local bodies for rehabilitation of the persons engaged in the act of Begging.
  • SMILE includes two sub-schemes – ‘Central Sector Scheme for Comprehensive Rehabilitation for Welfare of Transgender Persons’ and ‘Central Sector Scheme for Comprehensive Rehabilitation of persons engaged in the act of Begging’.
  • In case of non-availability of existing shelter homes, new dedicated shelter homes are to be set up by the implementing agencies.
  • The focus of the scheme is extensively on rehabilitation, provision of medical facilities, counselling, basic documentation, education, skill development, economic linkages and so on.
  • It is estimated that an approximate 60,000 poorest persons would be benefited under this scheme for leading a life of dignity.

Nasha Mukt Bharat Abhiyaan (NMBA)

  • The ‘Nasha Mukt Bharat Abhiyaan’ or a ‘Drugs-Free India Campaign’ was flagged off on 2020 across 272 districts of the country found to be most vulnerable based on the data available from various sources.
  • The Ministry of Social Justice & Empowerment which is the nodal ministry for Drug Demand Reduction, implements various programmes for the drug abuse prevention across the country.
  • The Nasha Mukt Bharat Annual Action Plan for 2020-21 would focus on 272 most affected districts and launch a three-pronged attack combining efforts of Narcotics Bureau, Outreach/Awareness by Social Justice and Treatment through the Health Dept.

The Action Plan has the following components:

  1. Awareness generation programmes;
  2. Focus on Higher Educational institutions, University Campuses and Schools;
  3. Community outreach and identification of dependent population;
  4. Focus on Treatment facilities in Hospital settings; and
  5. Capacity Building Programmes for Service Provider.

-Source: The Hindu

November 2023