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Monthly DNA
26 Dec, 2019
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Syllabus subtopic: Important Geophysical phenomena such as earthquakes, tsunamis, Volcanic activity, cyclones etc., geographical features and their location- changes in critical geographical features (including water bodies and ice-caps) and in flora and fauna and the effects of such changes.
Prelims and Mains focus: About typhoon Phanfone; about tropical cyclones and their types
News: Typhoon Phanfone pummelled the central Philippines on Christmas Day, bringing a wet, miserable and terrifying holiday to millions in the mainly Catholic nation.
About Tropical cyclones
Regional names for Tropical Cyclones
Regions |
Name |
Indian Ocean |
Cyclones |
Atlantic |
Hurricanes |
Western Pacific and the South China Sea |
Typhoons |
Western Australia |
Willy-willies |
Source: The Hindu
Syllabus subtopic: Indian culture will cover the salient aspects of Art Forms, Literature and Architecture from ancient to modern times.
Prelims and Mains focus: on the recent discovery by ASI and its significance; about Saptamatrikas; the need for conservation of our culture and heritage
News: In a significant find, the Epigraphy Branch of the Archaeological Survey of India has discovered the earliest epigraphic evidence so far for the Saptamatrika cult. It is also the earliest Sanskrit inscription to have been discovered in South India as on date.
Background
So far the Nagarjunakonda inscription of Ikshavaku king Ehavala Chantamula issued in his 11th regnal year corresponding to the 4th century A.D. was considered the earliest Sanskrit inscription in South India
About Saptamatrikas
About the discovered inscription
Conservation
Calling for conservation and preservation of the pillar given its historical importance, the ASI pointed out that there were many such ancient monuments and structures across the country that lacked protection but could contain a treasure trove of information.
About the Archaeological Survey of India (ASI)
Source: The Hindu
Syllabus subtopic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
Prelims and Mains focus: about the step taken by the GST Council and its significance; structure and mandate of GST Council
News: The GST Council will set up a grievance redressal mechanism for taxpayers. The decision was taken at the 38th meeting of the GST Council on December 18.
Details of the decision taken in the GST Council meeting
About GST Council
Composition
As per Article 279A of the amended Constitution, the GST Council which will be a joint forum of the Centre and the States, shall consist of the following members: -
Mandate of GST Council
It shall make recommendations to the Union and the States on—
Source: Indian Express
Syllabus subtopic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
Prelims and Mains focus: about the Recycling of Ships Act, 2019 and its significance; about the Hong Kong convention
News: With a new legislation in place, India aims to garner at least 60% of the global ship recycling business and emerge as a key destination for recycling warships and other ship.
Ship recycling in India
Note: To read the details of the Recycling of Ships Act, 2019, click on the link below:
http://prsindia.org/billtrack/recycling-ships-bill-2019
About the Hong Kong Convention
Source: The Hindu
Syllabus subtopic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.
Prelims and Mains focus: About fiscal deficit and its significance in determining economic status of a country; types of deficits
Context: Several economists have called for a proactive fiscal response to the current slowdown. However, others, such as Gita Gopinath and Arvind Subramanian, have advised against fiscal expansion.
Why is the fiscal deficit so important?
One of the reasons fiscal deficit is so important is that it gives us the extent of government borrowings required to meet its expenditure commitments in a financial year. It is an important indicator of macroeconomic stability. The 1991 balance of payments crisis came against the backdrop of a sustained high fiscal deficit. Several countries have seen economic or debt crises due to high deficits over the years. A sustained macroeconomic imbalance could lead to a recession.
What is its impact in a closed economy?
Lately, fiscal deficit hasn’t affected inflation much. However, it does have an impact on investments as it results in an increase in the cost of capital in a closed economy. When the government increases its borrowings, the savings left in the economy to finance private sector investment comes down. Therefore, the cost of capital goes up. This, in effect, dampens investments and is termed as “crowding out” of investment. This is precisely why several commentators have cautioned against increasing government borrowings at a time when investment by the private sector is low.
Do government borrowings ’crowd out’ investments?
Evidence from India reveals that government investment actually “crowds in” investment as these are made for the development of physical infrastructure. Investors need basic infrastructure in place before risking capital. Therefore, government investments to put in place this infrastructure are critical in crowding in private investment.
What’s the case for a fiscal expansion?
Lower demand results in unutilized capacities, which results in low investments. This leads to lower growth, thereby reducing demand. This vicious cycle should be broken by a proactive fiscal policy. Weak demand can be addressed only by a revival of private investment, improvement of private demand, or expansion in government demand. Only the third is in the government’s control. The Centre can increase the fiscal deficit to 3.8% of GDP. However, it should not shy away from going beyond this if needed.
What about bond yields, and cost of capital?
Higher borrowings can raise the cost of capital. Thus, many welcomed the move to opt for sovereign issuance, which would have led to the easing of rates locally. India can undertake fiscal expansion along with monetary easing. Muted non-food inflation along with external conditions make it the right time to cut rates for lower government borrowings cost. Our fiscal deficit is 80% interest. So a reduction in the cost of borrowing would create space for further expenditure.
About Deficit Financing
Deficit financing is the budgetary situation where expenditure is higher than the revenue. It is a practice adopted for financing the excess expenditure with outside resources. The expenditure revenue gap is financed by either printing of currency or borrowing.
Nowadays most governments both in the developed and developing world are having deficit budgets and these deficits are often financed through borrowing. Hence the fiscal deficit is the ideal indicator of deficit financing.
Deficit financing is very useful in developing countries like India because of revenue scarcity and development expenditure needs.
Various indicators of deficit in the budget are:
Source: mint
Syllabus subtopic: Conservation, environmental pollution and degradation, environmental impact assessment
Prelims and Mains focus: About the recent status of elephant conservation in India; Elephants reserves in India; Efforts and challenges in their conservation
News: For the first time, Bandhavgarh reserve forest in Madhya Pradesh has a colony of elephants – the same herd of about 40 animals that arrived at the sanctuary around this time last year, and has stayed on.
What’s unique about it?
Why Bandhavgarh is an ideal place for elephants to thrive
Measure taken by Union govt.
Significance
Elephants in Chattisgarh
Elephants in India
Source: Indian Express
GST may need an overhaul to plug a revenue shortfall Syllabus subtopic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment. Prelims and Mains focus: about GST and its significance; Why is GST still a contentious issue? &nb
Banks need to restart lending to industries to revive growth: RBI Syllabus subtopic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment. Prelims and Mains focus: About the RBI report and its significance; concerns raised by t
SEBI rolls out a stewardship code for all mutual funds and AIFs Syllabus subtopic: Statutory, regulatory and various quasi-judicial bodies Prelims and Mains focus: on the stewardship code and its significance; on mutual funds, AIFs, SEBI and its functions News: The Securities and
Syllabus subtopic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation. Prelims and Mains focus: about the recent amendments made in IBC; IBC and its significance News: The Union Cabinet on Tues
Chief of Defence Staff gets Cabinet nod Syllabus subtopic: Various Security forces and agencies and their mandate Prelims and Mains focus: about the newly created post of CDS and its significance News: The Union Cabinet chaired by Prime Minister, on Tuesday approved the creation
Syllabus subtopic: Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources. Prelims and Mains focus: about NPR and its significance; concerns raised and challenges in implementation; Citizenship Act News: The Un
The puzzle of a market boom in economic gloom Syllabus subtopic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment. Prelims and Mains focus: on the recent economic slowdown in the Indian economy and why it is not affecting t
RBI shifts assets into US Treasury bonds as a share of deposits drop Syllabus subtopic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment. Prelims and Mains focus: about Forex and its constituents; why RBI is keener on inves
Syllabus subtopic: Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources, issues relating to poverty and hunger. Prelims and Mains focus: about the key findings of the study and their significance News: Tamil
Syllabus subtopic: Bilateral, regional and global groupings and agreements involving India and/or affecting India's interests Prelims and Mains focus: about EAEU and its significane for India; Challenges to Indo-Russia relations in the changing world geopolitics. News:
PM chairs first meet of Cabinet Committee on Investment and Growth (CCIG) Syllabus subtopic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment. Prelims and Mains focus: about CCIG and its significance for India’s econo
Japan govt. proposes the release of Fukushima water Syllabus subtopic: Disaster and disaster management. Prelims and Mains focus: on the Fukushima nuclear disaster and its impact; concerns regarding releasing contaminated water into the sea News: On Monday, Japan’s Ministry of Economy
Syllabus subtopic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation. Prelims and Mains focus: About NRO account and the its eligibility criteria Context: More than a year before Parliament ame
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