04th Sep, 2018-IAS Current Affairs
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‘RBI and Gold’ (GS3: Indian Economy)
Issue: The Reserve Bank of India (RBI) has bought 8.46 tonne of gold in financial year 2017-18, the first purchase of yellow metal by the apex bank in almost nine years
The RBI held 566.23 tonne of gold as on June 30, 2018, compared with 557.77 tonne as on June 30, 2017, according to RBI’s latest annual report for 2017-18.
Reason for buying gold
This increase was primarily on account of depreciation of rupee as against the dollar and the addition of 8.44 tonne of gold during the year
Of 566.23 tonne of gold reserves, 292.30 tonne is held as backing for notes and is shown as an asset of the Issue Department, and the balance 273.93 tonne is treated as an asset of the Banking Department.
‘Typhoon Jebi’ (GS1: Geophysical phenomenon)
Issue: Japan issued evacuation advisories for almost 300,000 people and cancelled hundreds of flights in the face of strong winds and heavy rain as typhoon Jebi roared north and was set to make landfall
Jebi’s predicted course will bring it close to parts of western Japan hit by rains and flooding that killed more than 200 people in July. However, it was set to speed up after it makes landfall, minimizing the amount of rain that will fall in one place.
Typhoon, local name in the western North Pacific region for a large tropical cyclone
A typhoon is a mature tropical cyclone that develops between 180° and 100°E in the Northern Hemisphere. This region is referred to as the Northwestern Pacific Basin, and is the most active tropical cyclone basin on Earth, accounting for almost one-third of the world’s annual tropical cyclones.
A typhoon differs from a cyclone or hurricane only on the basis of location. A hurricane is a storm that occurs in the Atlantic Ocean or northeastern Pacific Ocean, a typhoon occurs in the northwestern Pacific Ocean, and a tropical cyclone occurs in the south Pacific or Indian Ocean
‘Tropical Storm Gordon’ (GS3: Science)
Issue: Tropical Storm Gordon lashed South Florida with heavy rains and high winds on Monday and is expected to strengthen into a hurricane when it hits the central U.S. Gulf Coast.
The Miami-based centre said the storm is also expected to bring “life-threatening” storm surge to portions of the central Gulf Coast. A storm surge warning has been issued for the area stretching from Shell Beach, Louisiana, to Dauphin Island, Alabama. The warning means there is danger of life-threatening inundation. The region could see rising waters of 3 to 5 feet (0.9 to 1.5 metres).
Difference between a hurricane and a typhoon
‘Belt and Road initiative and Africa’ (GS2: Effect of policies of other countries on India’s interests)
Issue: China has pledged a $60 billion fund to bolster industry, counter hunger, and enhance security in Africa, a continent that has been chronically plagued by piracy and terrorism.
For financing, China will nudge African countries to tap new multilateral lenders such as the Asian Infrastructure Investment Bank (AIIB), the New Development Bank (NDB) of the emerging economies, as well as the Silk Road Fund marshalled by China.
The Chinese have taken umbrage against allegations of involvement in “debt trap” diplomacy, by saddling smaller countries with unplayable loans, and using them as levers for political gain.
Ex: Hambantota port of Sri Lanka
About Belt and Road initiative
The Belt and Road Initiative (BRI) is an ambitious effort to improve regional cooperation and connectivity on a trans-continental scale. The initiative aims to strengthen infrastructure, trade, and investment links between China and some 65 other countries that account collectively for over 30 percent of global GDP, 62 percent of population, and 75 percent of known energy reserves. The BRI consists primarily of the Silk Road Economic Belt, linking China to Central and South Asia and onward to Europe, and the New Maritime Silk Road, linking China to the nations of South East Asia, the Gulf Countries, North Africa, and on to Europe. Six other economic corridors have been identified to link other countries to the Belt and the Road. The scope of the initiative is still taking shape—more recently the initiative has been interpreted to be open to all countries as well as international and regional organizations.
The Belt and Road Initiative can transform the economic environment in which economies in the region operate. Regional cooperation on the new and improved transport infrastructure and policy reforms could substantially reduce trade costs and improve connectivity, leading to higher cross-border trade and investment and improved growth in the region. For example, shipment times from China to Central Europe are approximately 30 days, as most goods travel by sea. Shipment times by train are about half as long, but given current infrastructure, much costlier. Hence, improving the capacity and network of rail infrastructure could radically change average travel times. And while rail transport will remain costlier than maritime for these routes, the time and cost reduction will have significant consequences for certain goods impacting the mode choice and total flows of international trade.
However, there are significant economic and policy challenges, and the realization of the potential benefits of BRI is by no means automatic. Policy reforms could have large effects. For example, Doing Business indicators show that in Central Asia it can take up to 50 days to comply with all procedures to import goods. It takes less than 10 in G7 countries, indicating the large scope for improvements at the border in the region. More generally, the return on investment in infrastructure is likely to be low or even negative unless complementary reforms are carried to improve institutions and the policy environment.
For individual countries, it will be important to evaluate the possible effects of participating to the BRI and the needed policies and institutional reforms. Some of the infrastructure and policy reforms envisaged by the BRI will be difficult to implement, creating risks ranging from fiscal sustainability, to negative environmental and social implications. There are also potential economic shocks created by the reduced trade costs that will require policies to deal with the adjustment and the lagging and negatively affected territories. Finally, opportunities for growth and poverty reduction will likely be contingent on appropriate macroeconomic conditions and supportive institutions and will differ for different countries and different social groups within countries depending on their comparative advantage, initial conditions and ability to reform.
Figure: Belt and Road initiative and connectivity plans
‘Risks to financial system’ (GS3: Indian Economy)
Issue: The exit from crisis-era stimulus by the world’s central banks won’t be an easy ride, and previous market turmoil could well be repeated, according to the Organization for Economic Cooperation and Development. It sees “elevated” risks ahead in the financial system, citing the shift in monetary policy, high levels of public debt and leverage in China’s banking and shadow-banking businesses.
The report isn’t the first to point out that central banks face a difficult balancing act when it comes to unwinding stimulus. The Bank for International Settlements has offered a variation of that view, saying that normalization will be “bumpy,” but policy makers shouldn’t be distracted if market wobbles are contained.
While progress has been made in boosting banks’ capital levels, not enough has been done to untangle commercial from investment banking, and many regulations don’t address new risks from fraud and disruptive technologies.
The mission of the Organisation for Economic Co-operation and Development (OECD) is to promote policies that will improve the economic and social well-being of people around the world.
The OECD provides a forum in which governments can work together to share experiences and seek solutions to common problems
The Organisation for European Economic Cooperation (OEEC) was established in 1948 to run the US-financed Marshall Plan for reconstruction of a continent ravaged by war. By making individual governments recognize the interdependence of their economies, it paved the way for a new era of cooperation that was to change the face of Europe. Encouraged by its success and the prospect of carrying its work forward on a global stage, Canada and the US joined OEEC members in signing the new OECD Convention on 14 December 1960. The Organisation for Economic Co-operation and Development (OECD) was officially born on 30 September 1961, when the Convention entered into force. The headquarter of OECD is located in Paris
Objectives of OECD
- Restore confidence in markets and the institutions that make them function.
- Re-establish healthy public finances as a basis for future sustainable economic growth.
- Foster and support new sources of growth through innovation, environmentally friendly ‘green growth’ strategies and the development of emerging economies.
- Ensure that people of all ages can develop the skills to work productively and satisfyingly in the jobs of tomorrow.
‘Monsoon related incidents (GS3: Disaster and Disaster management policy)
Issue: More than 1,400 people have so far lost their lives due to rains, floods and landslides in 10 States during the monsoon season this year, according to data released by the Union Home Ministry.
Other incidents caused due to monsoon
According to the Ministry’s National Emergency Response Centre, 488 people have died in Kerala and 54.11 lakh in 14 districts of the State have been severely hit by rains and floods, the worst in a century. As many as 14.52 lakh people displaced by floods are living in relief camps across the State. Standing crops on 57,024 hectares of land were damaged in the State.
‘Himalayan Springs’ (GS3: Conservation of Environment)
Issue: A NITI Aayog constituted group of experts has urged the government to set up a dedicated mission to salvage and revive spring water systems in the country’s Himalayan States given their vital importance as a source of water for both drinking and irrigation for the region’s inhabitants.
Need for a new programme
Spanning States across the country’s north and northeast and home to about 50 million people, the Indian Himalayan Region (IHR) has been heavily reliant on these natural groundwater sources that are under increasing threat from the urbanization caused by a constant push for development and climate change.
Almost half of the perennial springs have already dried up or have become seasonal and tens of thousands of villages are currently facing acute water shortage for drinking and other domestic purposes. Almost 60% of low-discharge springs that provided water to small habitations in the Himalayan region have reported clear decline during the last couple of decades
Also, with almost 64% of the cultivable area in the Himalayas fed by natural springs, they are often the only source of irrigation in the region.
Other observations made by the panel
Microbial content, sulphates and nitrates were primarily because of anthropogenic reasons and contamination from fluoride, arsenic and iron was mainly derived from geogenic sources. Coliform bacteria in spring water could originate from septic tanks, household wastewater, livestock facilities, and manure lagoons in the source area or in the aquifers feeding springs. Similarly, nitrate sources were septic tanks, household wastewater, agricultural fertilizers, and livestock facilities.
The task force moots an 8-year programme to overhaul spring water management. This includes: preparing a digital atlas of the country’s springsheds, training ‘para-hydrogeologists’ who could lead grassroots conservation and introduction of a ‘Spring Health Card.’
‘Logistics development’ (GS2: India-Russia ties)
Issue: India and Russia are in the process of concluding a logistics agreement, with both sides targeting to conclude consultations before the annual summit in October between Prime Minister Narendra Modi and Russian President Vladimir Putin.
The proposed agreement follows a series of such agreements India has signed since the first logistics agreement with the U.S.
India signed the Logistics Exchange Memorandum of Understanding (LEMOA), with the U.S. in August 2016 after a decade of negotiations.
What is the agreement about?
Logistics agreements are administrative arrangements facilitating access to military facilities for exchange of fuel and provisions on mutual agreement simplifying logistical support and increasing operational turnaround of the military when operating away from India.
India and Russia have had deep rooted military cooperation for several decades. Such agreements shall further benefit both the countries
‘Indian oil import’ (GS3: Indian Economy)
Issue: India will allow public sector refiners to import Iranian oil with Tehran arranging tankers and insurance after firms, including the country’s top shipper Shipping Corp of India (SCI), halted voyages due to U.S. sanctions
New Delhi’s attempt to keep Iranian oil flowing mirrors a step by China, where buyers are shifting nearly all their Iranian oil imports to vessels owned by National Iranian Tanker Co (NITC).
Under a CIF arrangement, Iran would provide shipping and insurance, enabling Indian refiners to continue purchases of the country’s oil despite the non-availability of cover from Western insurers due to the restrictions imposed by Washington.
‘Superbugs’ (GS2: Issues related to Heath)
Issue: A superbug resistant to all known antibiotics that can cause “severe” infections or even death is spreading undetected through hospital wards across the world, scientists in Australia have warned
Researchers at the University of Melbourne discovered three variants of the multidrug-resistant bug in samples from 10 countries, including strains in Europe that cannot be reliably tamed by any drug currently on the market.
The bacteria, known as Staphylococcus epidermidis, is related to the better-known and more deadly MRSA superbug. It’s found naturally on human skin and most commonly infects the elderly or patients who have had prosthetic materials implanted, such as catheters and joint replacements.
What are superbugs?
Antibiotics have been an important part of modern medicine since the 1930s. Their use has resulted in improved health and increased life-span, and has enabled many of the medical breakthroughs—such as any surgery and neonatal care—that we now take for granted. However, antibiotics have been used for so long, and so widely, around the world that many of the infectious organisms they are designed to eliminate have adapted and become resistant to them.
When bacteria become resistant to different classes of antibiotics, they are often called ‘superbugs’. In the past, most of these superbugs were confined to healthcare settings such as hospitals and nursing homes, where already sick patients in a weakened condition were more susceptible to contracting infections. More recently, superbug infections have started to appear in the wider general population outside of hospitals.
The creation of superbugs due to antibiotic resistance is a serious risk for global public health, where common infections and minor injuries, which have been treatable for decades, will potentially be life-threatening once again.
Antibiotic resistance is a growing problem. Many countries are putting strategies in place to help combat it―including surveillance, education campaigns, policy change and research funding. At an individual level, we can ensure we only take antibiotics and other antimicrobial drugs when really necessary, follow all instructions correctly, and work to keep ourselves and our families healthy.