EASE: Public Sector Bank (PSB) Reforms Agenda

• Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman today unveiled the fourth edition of the Public Sector Bank (PSB) Reforms Agenda ‘EASE 4.0’ for 2021-22 - tech-enabled, simplified, and collaborative banking.
• She unveiled the annual report for the PSB Reforms Agenda EASE 3.0 for 2020-21 and participated in the awards ceremony to felicitate best performing banks on EASE 3.0 Banking Reforms Index.
• State Bank of India, Bank of Baroda and Union Bank of India have won the awards for best performing banks for PSB Reforms EASE 3.0 based on the EASE index.
• Indian Bank won the award for the best improvement from the baseline performance. SBI, BoB, Union Bank of India, Punjab National Bank and Canara Bank won the top awards in different themes of the PSB Reforms Agenda EASE 3.0.
• Public Sector Banks have reported healthy profits and have accelerated technology-driven reforms. These banks have reported a profit of Rs. 31,817 crores in FY21 as compared to a loss of Rs. 26,016 crores in FY20. This is the first year when PSBs have reported a profit after five years of losses. Total gross non-performing assets stood at Rs. 6.16 lakh crore as of March 2021 - a reduction of Rs. 62,000 crores from March 2020 levels.

Digital lending

• Credit@click was a flagship initiative under EASE 3.0. Nearly 4.4 lakh customers have benefitted through such instantaneous and simplified credit access.
• PSBs have set up mechanisms for customers where they can register loan requests 24X7 through digital channels such as Mobile and Internet banking, SMS, missed calls and call centre. In FY21, PSBs have collectively disbursed Rs. 40,819 crore of fresh personal, home and vehicle loans through leads sourced from such digital channels.
• The top 7 PSBs have built analytics capabilities through the setup of dedicated analytics teams and IT infrastructure to proactively offer loans to their existing customers. Such loan offers were generated using the existing customer transaction data within the banks. In FY21, Rs. 49,777 crores of fresh retail loan disbursements were made by the top 7 PSBs based on these credit offers.
• PSBs have also extensively used external partnerships and dedicated marketing salesforce networks for the sourcing of retail segment and MSME segment loans. Sourcing from such channels has been 9.1 lakh loans in FY21.

Mobile/Internet banking and customer service

• Nearly 72% of financial transactions happening at PSBs is now happening through digital channels. PSBs are now offering services across call centres, Internet banking, and Mobile banking in 14 regional languages such as Telugu, Marathi, Kannada, Tamil, Malayalam, Gujarati, Bengali, Odia, Kashmiri, Konkani, Hindi, Punjabi, Assamese for the ease of customers.
• For continual improvement in coverage under financial inclusion initiatives, there was a 13% growth in transactions provided by Bank Mitras in rural areas and 50% growth in enrolments in Micro personal accident insurance in Q4FY21 compared to Q4FY20.
• PSBs have recorded phenomenal growth in their performance over four quarters since the launch of the EASE 3.0 Reforms Agenda. The overall score of PSBs increased by 35% between March 2020 and March 2021, with the average EASE index score improving from 44.2 to 59.7 out of 100. Significant progress is seen across six themes of the Reforms Agenda, with the highest improvement seen in the themes of ‘Smart Lending’ and ‘Institutionalising Prudent Banking’.

The next edition of EASE reforms i.e. EASE 4.0 aims to further the agenda of customer-centric digital transformation and deeply embed digital and data into PSBs' ways of working.

Reuse of wastewater: TADOX Technology by TERI

• New technology may soon enhance the reuse of wastewater in an affordable and sustainable manner.
• The technology which uses UV-Photocatalysis can treat municipal sewage and highly polluting industrial wastewater streams and increase its reuse as a technological option in industrial as well as municipal wastewater treatments.
• With the ever-increasing Water crisis and Water pollution, it becomes imperative for industries & utilities to reuse ‘treated water.
• However, the current treatment practices are inefficient because of their high dependence on biological treatment systems, which are unable to bear shock loads.
• This is followed by tertiary treatment systems involving RO and Multi Effect Evaporators (MEE).
• These systems have a large carbon footprint and maintenance costs making wastewater treatment highly unsustainable and unaffordable. These researchers have felt the need to integrate novel approaches and advanced technologies in current systems.
• The Energy and Resources Institute, New Delhi, has developed a technology called The Advanced Oxidation Technology or TADOX® which ‘can reduce less dependence and load on biological and tertiary treatment systems and help achieve Zero Liquid Discharge (ZLD).
• It can bring down capital expenditure on ZLD by 25-30% and operating expense by 30-40% for industrial wastewater treatment.
• The Advanced Oxidation Technology, TADOX® developed by TERI New Delhi for wastewater treatment is an effort in this direction.
• Department of Science and Technology (DST), GoI- Water Technology Initiative (WTI) has supported TERI to develop this technology at bench scale collaboration in tie-up with ONGC Energy Centre (OEC), Delhi.
• The technology supported by the Water Technology Initiative (WTI) of the Department of Science and Technology, Govt. of India involves UV-Photocatalysis as an Advanced Oxidation Process (AOP) at the secondary treatment stage leading to oxidative degradation and mineralization of targeted pollutants.
• It improves biodegradability, thereby preventing bio-fouling of membranes and enhancing life span and efficiency of RO systems as also overall load on evaporators like Multiple Effect Evaporators and Mechanical vapor recompression (MVR), and so on.
• It can reduce Chemical Oxygen Demand (COD), Biological Oxygen Demand (BOD), dissolved organics, pathogens, Persistent Organic Pollutants (POPs), and Micropollutants.
• TADOX® could be integrated and retrofittable in existing treatment systems making it a viable option as a novel Decentralized Wastewater Treatment Technology (DWTT) applicable in upcoming and existing infrastructural projects, townships, commercial complexes, green buildings, and smart cities.
• The technology has been adopted by an MSME Company to scale up to 10 Kilo Litre per Day continuous running plant in TERI Gurugram campus. TADOX® technology has been chosen for pilot trials and augmentation plan for identified industrial sectors under ‘Namami Gange’ Programme of the Ministry of Jal Shakti, Govt. of India. The Technology is at TRL 7 and ready for commercialization through field implementations and Technology & Trademark License Agreement from 1st April 2021.

Sugarcane: Major crops and cropping patterns of India

• Sugarcane (Saccharum officinarum) family Gramineae (Poaceae) is widely grown crop in India.
• It provides employment to over a million people directly or indirectly besides contributing significantly to the national exchequer.
• Sugarcane growing countries of the world lay between the latitude 36.7° north and 31.0° south of the equator extending from tropical to subtropical zones.
• Sugar cane originated in New Guinea where it has been known for thousands of years. Sugar cane plants spread along human migration routes to Asia and the Indian subcontinent.
• Here it cross-bred with some wild sugar cane relatives to produce the commercial sugar cane we know today.
• Cultivation of sugarcane in India dates back to the Vedic period (1400 to 1000 BC). It is now widely accepted that India is the original home of Saccharum species.
• The cultivated canes belong to two main groups: (a) thin, hardy north Indian types S.barberi and S.Sinense and (b) thick, juicy noble canes Saccharum officinarum.

Important regions/ zones for sugarcane cultivation in India

• Broadly there are two distinct agro-climatic regions of sugarcane cultivation in India, viz., tropical and subtropical.
• However, five agro-climatic zones have been identified mainly for the purpose of varietal development. They are (i)North Western Zone (ii) North Central Zone (iii) North Eastern Zone (iv) Peninsular Zone (v) Coastal Zone.
• Tropical region: Shared about 45% and 55% of the total sugarcane area and production in the country, respectively along with the average productivity of 77 t/ha (2011-12).
• Sub-tropical region: accounted for about 55% and 45% of total area and production of sugarcane with an average productivity about 63 t/ha (2011-12).
• Tropical Sugarcane region: The tropical sugarcane region consists of sugarcane agro climatic zone 4 (peninsular zone) and 5(Coastal zone) which includes the states of Maharashtra, Andhra Pradesh, Tamil Nadu, Karnataka, Gujarat, Madhya Pradesh, Goa, Pondicherry and Kerala.
• Sub-tropical sugarcane region: Around 55 per cent of total cane area in the country is in the sub-tropics. U.P, Bihar, Haryana and Punjab comes under this region.
• Crop distribution: Sugarcane growing countries of the world are lying between the latitude 36.70 north and 31.00 south of the equator extending from tropical to sub-tropical zones.
• In India sugarcane is cultivated all over the country from latitude 80 N to 330 N, except cold hilly areas like Kashmir valley, Himachal Pradesh and Arunachal Pradesh.
• Climatic requirement: Temperature for different critical stages of sugarcane: The different critical stages are germination, tillering, early growth, active growth and elongation. Optimum temperature for sprouting (germination) of stem cuttings is 32° to 38°c. It slows down below 25°, reaches plateau between 30°-34°. Temperatures above 38° reduce the rate of photosynthesis and increase respiration. For ripening, however, relatively low temperatures in the range of 12° to 14° are desirable.

Reduction in yield of sugarcane due to rise in temperature

• The sugarcane productivity and juice quality are profoundly influenced by weather conditions prevailing during the various crop-growth sub-periods.
• Sugar recovery is highest when the weather is dry with low humidity; bright sunshine hours, cooler nights with wide diurnal variations and very little rainfall during ripening period.
• These conditions favour high sugar accumulation.
• The climatic conditions like very high temperature or very low temperature deteriorate the juice quality and thus affecting the sugar quality.
• Favourable climate like warm and humid climate favour the insect pests and diseases, which cause much damage to the quality and yield of its juice and finally sucrose contents.

Area, production and yield of sugarcane in major growing states

• In Tropical zone Maharashtra is the major sugarcane growing state covering about 9.4 lakh ha area with production of 61.32 Million ton, whereas the productivity of Tamil Nadu is highest in tropical zones.
• Uttar Pradesh is the highest sugarcane producing State in sub tropical zone having area about 22.77 Lakh ha with the production of 135.64 Million Ton cane whereas Haryana has highest productivity of sugarcane in Sub tropical zone.

SAMRIDH Scheme

• Startups are new types of wealth creators in our country. The need of the hour is to relentlessly work towards making India’s Startups and the Startup Ecosystem the best in the whole world.
• This vision of the Prime Minister was also emphasised by Electronics and Information Technology Minister Shri Ashwini Vaishnaw in a recent event whereby he stated, “Government will support startups and entrepreneurs in the most challenging phase which is the initial risk phase and also stated to serve 1.3 billion people India will scale up the network of incubators and accelerators to phenomenal levels.”
• The above statements of Shri Ashwini Vaishnaw today have taken the shape of the “Start-up Accelerators of MeitY for Product Innovation, Development and Growth (SAMRIDH)” programme, which was launched today by the Ministry of Electronics & Information Technology so as to create a conducive platform to Indian Software Product star-ups to enhance their products and securing investments for scaling their business.
• The programme is being implemented by MeitY Start-up Hub (MSH).
• The initiative will not only provide funding support to the startups but will also help in bringing skill sets together which will help them to become successful.
• SAMRIDH scheme will pick up startups that are ready for the acceleration stage and will provide them with funding support, mentorship and a lot of other support that is required by startups at this stage.
• The SAMRIDH programme will focus on accelerating the 300 start-ups by providing customer connect, investor, connect, and international immersion in the next three years.
• Also, an investment of up to? 40 lakh to the start-up based on current valuation and growth stage of the Start-Up will be provided through selected accelerators.
• It will also facilitate equal matching investment by the accelerator/investor.
• The programme aims to further the Indian start-up growth which has seen the emergence of 63 Unicorns is now the third largest Unicorn hub globally with a total valuation of 168 Bn USD.

FRP and Sugar Pricing Policy in India

• With the amendment of the Sugarcane (Control) Order, 1966 on 22.10.2009 and the concept of Statutory Minimum Price (SMP) of sugarcane was replaced with the ‘Fair and Remunerative Price (FRP)’ of sugarcane for 2009-10 and subsequent sugar seasons.
• The cane price announced by the Central Government is decided on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP) after consulting the State Governments and associations of the sugar industry.
• The amended provisions of the Sugarcane (Control) Order, 1966 provide for fixation of FRP of sugarcane having regard to the following factors:-

1. cost of production of sugarcane;
2. return to the growers from alternative crops and the general trend of prices of agricultural commodities;
3. availability of sugar to consumers at a fair price;
4. price at which sugar produced from sugarcane is sold by sugar producers;
5. recovery of sugar from sugarcane;
6. the realization made from the sale of by-products viz. molasses, bagasse and press mud or their imputed value;
7. reasonable margins for the growers of sugarcane on account of risk and profits

• Under the FRP system, the farmers are not required to wait till the end of the season or for any announcement of the profits by sugar mills or the Government.
• The new system also assures margins on account of profit and risk to farmers, irrespective of the fact whether sugar mills generate profit or not and is not dependent on the performance of any individual sugar mill.
• In order to ensure that higher sugar recoveries are adequately rewarded and considering variations amongst sugar mills, the FRP is linked to a basic recovery rate of sugar, with a premium payable to farmers for higher recoveries of sugar from sugarcane.
• Accordingly, FRP for the 2017-18 sugar season has been fixed at Rs. 255 per QTL. linked to a basic recovery of 9.5% subject to a premium of Rs.2.68 per QTL for every 0.1 percentage point increase above that level.

FRP of Sugarcane in 2021-22

• Government has approved the Fair and Remunerative Price (FRP) of sugarcane for sugar season 2021-22 (October - September) at Rs. 290/- per quintal.
• The cost of production of sugarcane for the sugar season 2021-22 is Rs. 155 per quintal. This FRP of Rs. 290 per quintal at a recovery rate of 10% is higher by 87.1% over production cost, thereby giving the farmers a return of much more than 50% over their cost.
• In the current sugar season 2020-21, about 2,976 lakh tons of sugarcane worth Rs. 91,000 cr was purchased by sugar mills, which is at all-time high level & is the second highest next to the procurement of paddy crop at Minimum Support Price.
• Keeping the expected increase in the production of sugarcane in the ensuing sugar season 2021-22, about 3,088 lakh tons of sugarcane is likely to be purchased by sugar mills. The total remittance to the sugarcane farmers will be about Rs. 1,00,000 crore. The Government through its pro-farmer measures will ensure that sugarcane farmers get their dues in time.
• The FRP approved shall be applicable for purchase of sugarcane from the farmers in the sugar season 2021-22 (starting w.e.f. 1st October, 2021) by sugar mills.
• In last 3 sugar seasons 2017-18, 2018-19 & 2019-20, about 6.2 Lakh Metric Tonne (LMT), 38 LMT & 59.60 LMT of sugar has been exported. In the current sugar season 2020-21 (Oct – Sept.), against the export target of 60 LMT, contracts of about 70 LMT have been signed & more than 55 LMT has been physically exported from the country, as on 23.8.2021. The export of sugar has improved the liquidity of sugar mills enabling them to clear cane price dues of farmers.
• Government is also encouraging sugar mills to divert excess sugarcane to ethanol which is blended with petrol, which not only serves as a green fuel but also saves foreign exchange on account of crude oil import. In last 2 sugar seasons 2018-19 & 2019-20, about 3.37 LMT & 9.26 LMT of sugar has been diverted to ethanol. In the current sugar season 2020-21, more than 20 LMT is likely to be diverted.
• In the past 3 sugar seasons about Rs. 22,000 crore revenue was generated by sugar mills/ distilleries from the sale of ethanol to Oil Marketing Companies (OMCs).
• In the current sugar season 2020-21, about Rs. 15,000 cr revenue is being generated by sugar mills from the sale of ethanol to OMCs at 8.5%.
• This is expected to significantly increase in the next 3 years as we go up to 20% blending by 2025.
• In the previous sugar season 2019-20, about Rs. 75,845 crores cane dues were payable, out of which Rs. 75,703 crores has been paid & only Rs. 142 crore arrears are pending. Even, in the current sugar season 2020-21, out of cane dues payable of Rs. 90,959 crores, Rs. 86,238 crores cane dues have already been paid to farmers. An increase in export & diversion of sugarcane to ethanol is ensuring timely cane price payments to farmers.

De-regulation of Sugar sector on the recommendations of C. Rangarajan Committee report

• The year 2013-14 was a watershed for the sugar industry.
• The Central Government considered the recommendations of the committee headed by Dr. C. Rangarajan on the de-regulation of the sugar sector and decided to discontinue the system of levy obligations on mills for sugar produced after September 2012 and abolished the regulated release mechanism on open market sale of sugar.
• The de-regulation of the sugar sector was undertaken to improve the financial health of sugar mills, enhance cash flows, reduce inventory costs and also result in timely payments of cane price to sugarcane farmers.

C Rangarajan Committee report

• Cane Area Reservation: Over a period of time, states should encourage development of such market-based long-term contractual arrangements, and phase out cane reservation area and bonding. In the interim, the current system may continue.
• Minimum Distance Criteria: It is not in the interest of the development of sugarcane farmers or the sugar sector, and may be dispensed with as and when a state does away with cane reservation area and bonding.
• Sugarcane Price : Revenue Sharing: Based on an analysis of the data available for the by-products (molasses and bagasse/cogeneration), the revenue-sharing ratio has been estimated to amount to roughly 75 per cent of the ex-mill sugar price alone.
• Levy sugar may be dispensed with. The states which want to provide sugar under PDS may henceforth procure it from the market directly according to their requirement and may also fix the issue price. However, since currently there is an implicit cross-subsidy on account of the levy, some level of Central support to help states meet the cost to be incurred on this account may be provided for a transitory period.
• Regulated Release Mechanism: This mechanism is not serving any useful purpose, and may be dispensed with.
• As per the committee, trade policies on sugar should be stable. Appropriate tariff instruments like a moderate export duty not exceeding 5 % ordinarily, as opposed to quantitative restrictions, should be used to meet domestic requirements of sugar in an economically efficient manner.
• By products: There should be no quantitative or movement restrictions on by-products like molasses and ethanol. The prices of the by-products should be market-determined with no earmarked end-use allocations. There should be no regulatory hurdles preventing sugar mills from selling their surplus power to any consumer.
• Compulsory Jute Packing: May be dispensed with.
• The recommendations of the Committee relating to Cane Area Reservation, Minimum Distance Criteria and adoption of the Cane Price Formula have been left to State Governments for adoption and implementation, as considered appropriate by them.