Daily Analysis: 8th September 2020

Daily Analysis: 8th September 2020

The Hindu, PIB, IE and Others

Index

A) Economy

1. K-shaped Recovery

B) Polity/Bills/Acts/Judgments

2. The Foreign Contribution (Regulation) Act, 2010 (TH)

C) Geography, Environment and Biodiversity

3. Warmer Arabian Sea led to intense rain in August (HT)

D) International Relations

4. What is the ‘Thin Blue Line flag’, embraced by right wing supporters in the US? (IE)

E) Science and Technology; Defence

5. Hypersonic Technology Demonstrator Vehicle (HSTDV) (IE)

F) Indices/Committees/Reports/Organisations

6. First World Solar Technology Summit (PIB)

G) Miscellaneous

7. Indira Gandhi Prize for Peace, Disarmament and Development (TH, pg 11)

A) Economy

1. K-shaped Recovery

  • The term ‘K-shaped recovery’ is used to describe what has been happening in varying degrees since the financial crisis of 2008: The growing gap between winners and losers among countries, economic sectors, companies, and, of course, people.

For example: Industries like technology, retail, and software services have recovered from the industry and begun re-hiring, while the travel, entertainment, hospitality, and food services industries have continued to decline past March levels.

Other Major Types of Economic Recoveries

Z-shaped Recovery

  • If the economic disruption was just for a small period wherein more than people’s incomes, it was their ability to spend that was restricted, it is possible to imagine a “Z”-shaped recovery.
  • In this, the GDP — and here we are talking about absolute GDP, not GDP’s growth rate — actually overshoots the trend path because of the pent-up demand.
  1. Imagine, deferred parties, salon visits, movies, purchase of new cars, houses and appliances etc. — all of them get bunched up together.

V-shaped Recovery

  • But what if the economic disruption lasts longer resulting in several activities being forgone instead of being deferred?
  • For instance, even the monthly haircut — when you go to the salon after 3 months, you have already lost 2 haircuts-worth of economic activity forever!
  • In such a scenario, and assuming incomes and jobs are not permanently lost, the economic growth recovers sharply and returns to the path it was following before the disruption. This is called a “V”-shaped recovery.

U-shaped Recovery

  • But what will happen if this recovery is slower and takes more time because the economic disruption resulted in several jobs being lost and people losing incomes, drawing down on their savings etc.?
  • Then the economy will follow a “U”-shaped path. In such a scenario, after the initial fall, the recovery is gradual before regaining its momentum.

W-shaped Recovery

  • Since we are talking about a Covid-induced disruption, it makes sense to also look at a “W”-shaped recovery as well.
  • This shape allows for the possibility of a V-shaped recovery, which is pegged back by a second wave of infections until of course, the economy recovers for the second time.

L-shaped Recovery

  • The last scenario is the one policy-makers most dread. It is called the “L”-shape recovery.
  • Here, simply put, the economy fails to regain the level of GDP even after years go by.
  • As the shape shows, there is a permanent loss to the economy’s ability to produce.

B) Polity/Bills/Acts/Judgments

2. The Foreign Contribution (Regulation) Act, 2010 (TH)

Context: License of some NGOs under the Foreign Contribution Regulation Act (FCRA) has been suspended by the Union Home Ministry.

Analysis

  • Any NGO or association that intends to receive foreign funds has to compulsorily register under the Foreign Contribution Regulation Act (FCRA), monitored by the Ministry of Home Affairs (MHA).
  • According to the 2010 Act, registered NGOs can receive foreign contribution for five purposes — social, educational, religious, economic and cultural.
  • The Home Ministry also amended the Foreign Contribution (Regulation) Rules, 2011 in September 2019 that all the members and office bearers of an NGO will have to file an affidavit making it mandatory for it to report “any violation” of the FCRA provisions by the applicant organisation. 

The Foreign Contribution (Regulation) Act, 2010

  • It extends to the whole of India, and it shall also apply to—

    (a) citizens of India outside India; and

    (b) associate branches or subsidiaries, outside India, of companies or bodies corporate, registered or incorporated in India.
  • Every person who has been granted a certificate or given prior permission shall receive foreign contribution in a single account only through such one of the branches of a bank.
  • No funds other than foreign contribution shall be received or deposited in such account or accounts.
  • However, such person may open one or more accounts in one or more banks for utilising the foreign contribution received by him.

Who can accept Foreign Contribution?

  • Organizations working for definite cultural, social, economic, educational or religious programs canaccept foreign contribution but first, they’ve to get permission from the Ministry of Home Affairs.
  • They also have to maintain a separate account book listing the donation received from foreigners and get it audited by a Chartered Accountant and submit it to Home Ministry every year.

Prohibition to accept foreign contribution.

  • No foreign contribution shall be accepted by any—

    (a) candidate for election;

    (b) correspondent, columnist, cartoonist, editor, owner, printer or publisher of a registered newspaper;

    (c) Judge, Government servant or employee of any corporation or any other body controlled or owned by the Government;

    (d) member of any Legislature;

    (e) political party or office-bearer thereof (this provision has been amended);

    (f) organisation of a political nature;

    (g) association or company engaged in the production or broadcast of audio news or audio-visual news or current affairs programmes through any electronic mode.
  • No person who receives foreign contribution as per provisions of this Act, shall transfer to other person unless that person is also authorized to receive foreign contribution as per rules made by the Central Government. 
  • Foreign contribution shall be utilized for the purpose for which it has been received and such contribution can be used for administrative expenses up to 50% of such contribution received in a financial year.
  • However, administrative expenses exceeding fifty per cent of the contribution to be defrayed with the prior approval of the Central Government.

Why is FCRN Act in news in the recent past?

  • The government has amended (retrospectively) the FCRA, allowing foreign-origin companies to finance non-governmental organisations and thus political parties by changing the definition of “foreign companies”.
  • Political parties in India can receive political donations from Indians living abroad as well as foreign companies with subsidiaries in India.
  • Any foreign company can donate any amount of money to Indian political parties through their subsidiaries in India by purchasing electoral bonds.
  • Electoral bonds are promissory notes that can be encashed by a registered political party through a designated bank account.
  • Bonds would allow anonymous, digital donations to parties.

C) Geography, Environment and Biodiversity

3. Warmer Arabian Sea led to intense rain in August (HT)

Context: An unusually warm Arabian Sea is likely to have contributed to intense bursts of monsoon rain in parts of India in August, which in particular led to flooding and landslides in many parts of the west coast, scientists said.

Analysis

  • Arabian Sea has been warming rapidly in recent decades. This makes the air above warmer, humid and unstable. As a result, the monsoon winds are exhibiting more fluctuations than earlier. So occasionally there are episodes where huge amount of moisture is dumped along the west coast of India in a few days’ time.
  • This year again, the northern Arabian Sea was up to 2-3°C warmer than usual in August, and we saw several spurts of monsoon rains across the west coast.
  • There are several scientific papers that have concluded that the Arabian Sea is becoming warmer as a result of climate change.
  • Rapid warming in the Arabian Sea has resulted in a rise in widespread extreme rains over Western Ghats and central India, since warming induces increased fluctuations in the monsoon winds, with ensuing episodes of enhanced moisture transport from the Arabian Sea towards the Indian subcontinent. Indian Ocean warming is also found to reduce rainfall over India during the onset phase and increase it during the withdrawal phase.
  • Models also indicate that there will be higher SST (sea surface temperature) warming over Arabian Sea compared to Bay of Bengal.
  • Some scientists cautioned that SSTs may have been one of the factors.
  • Low pressure areas formed over Bay of Bengal which strengthened the monsoon winds are an equally dominant factor.

D) International Relations

4. What is the ‘Thin Blue Line flag’, embraced by right wing supporters in the US? (IE)

What is the ‘Thin Blue Line’?

  • The term is “used to refer to the police, typically in the context of maintaining order during unrest.”

The Contentious Flag

  • It was after 2014 that a flag representing the Thin Blue Line idea appeared; a black and white version of the American national flag, with a blue stripe running horizontally under the stars.
  • The flag, which aims to express support for law and order and police personnel, was soon embraced by several serving and retired officers across the country; many attaching it to their patrol vehicles, uniforms and even displaying them on face masks during the Covid-19 pandemic.
  • However, the flag stirred controversy after it was co-opted by right wing groups, especially by the Blue Lives Matter movement, which sprung up in 2014 as a counterforce to the anti-racism Black Lives Matter movement.

E) Science and Technology and  Defence

5. Hypersonic Technology Demonstrator Vehicle (HSTDV) (IE)

Context: The Defence Research and Development Organisation (DRDO) recently successfully flight tested the Hypersonic Technology Demonstrator Vehicle (HSTDV) – an unmanned scramjet vehicle with a capability to travel at six times the speed of sound, making India the fourth country in the world after the US, China and Russia to develop such technology.

Analysis

  • This successful test will pave the way for missiles that can travel at six times the speed of sound.
  • Apart from being used as a vehicle for hypersonic and long-range cruise missiles, the HSTDV is a dual-use technology that will have multiple civilian applications, including the launch of small satellites at low cost. 
  • The test was conducted using the Agni missile.
  • A solid rocket motor of Agni missile was used to take to an altitude of 30 kilometers where the cruise vehicle separated from the launch vehicle and the air intake opened as planned.

The hypersonic vehicle and its scramjet engine

  • The scramjets are a variant of a category of jet engines called the air breathing engines.
  • The ability of engines to handle airflows of speeds in multiples of speed of sound, gives it a capability of operating at those speeds.
  • Hypersonic speeds are those which are five times or more than the speed of sound (Mach 5 or more).

Hypersonic nuclear missiles

  • Hypersonic missiles travel at speeds faster than 3,800 miles per hour or 6,115 km per hour, much faster than other ballistic and cruise missiles.
  • They can deliver conventional or nuclear payloads within minutes.
  • They are highly manoeuvrable and do not follow a predictable arc as they travel.
  • They are said to combine the speed of ballistic missiles with the manoeuvring capabilities of cruise missiles.
  • The speed makes them hard to track compared to traditional missile tech.
  • In March this year, the United States announced it had successfully tested an unarmed prototype of a hypersonic missile.

F) Indices/Committees/Reports/Organisations

6. First World Solar Technology Summit (PIB)

  • The first World Solar Technology Summit (WSTS) was organized by the International Solar Alliance (ISA), on 8th September 2020.

Analysis

International Solar Alliance (ISA)

  • The ISA was jointly launched in November 2015 by India and France, on the side lines of the United Nations Framework Convention on Climate Change (UNFCCC) Conference of Parties 21 (CoP21) at Paris, France.
  • The ISA is a treaty-based alliance of around 122 prospective solar-rich Member Nations situated fully or partially between the Tropics, and aims at accelerating development and deployment of solar energy globally.
  • As on 30 July 2020, 87 Countries have signed the Framework Agreement of the ISA and of these 67 have deposited their instruments of ratification.
  • Most of these countries fall within Asia, Africa and South America.
  • There are three objectives behind the International Solar Alliance:
  1. To force down prices by driving demand;
  2. To bring standardisation in solar technologies; and
  3. To foster research and development.
  • The Alliance had already got the required number of ratification (by 15 countries) to become an international legal entity.
  • The 15 countries which have already submitted their instrument of ratification include India, France, Mauritius, Niger, Nauru, Tuvalu, Fiji, Somalia, Ghana, Mali, Seychelles, South Sudan, Bangladesh, Comoros and Guinea. 
  • Its Headquarters is in India with its Interim Secretariat being setup in Gurgaon.
  • It is the India’s first international and treaty based inter-governmental organization to have headquarters in India with United Nations as Strategic Partner.
  • Countries that do not fall within the Tropics can join the ISA as “Partner Countries” and enjoy all benefits as other members, with the exception of voting rights (it needs to be confirmed after this universalisation initiation).
  • United Nations including its organs can join the ISA as “Strategic Partners”.
  • Partner Countries, Partner Organizations, Strategic Partners, and Observers may participate without having the right to vote.
  • The ISA has set a target of 1 TW (1,000 gigawatts) of solar energy by 2030 through mobilisation of more than 1000 Billion US Dollars of investments.
  • Though there are no targets or legal obligations imposed on member-countries.
  • In March 2018, the Prime Minister of India, and the President of France co-hosted the founding conference of the International Solar Alliance (ISA) in New Delhi.
  • The Delhi Solar Agenda, adopted in the Founding Conference of the ISA, states that the ISA member States inter-alia have agreed to pursue an increased share of solar energy in the final energy consumption in respective national energy mix.
  • The first Assembly of the International Solar Alliance was inaugurated in New Delhi in October 2018.
  • The First Assembly considered and adopted the proposal made by India for an amendment to the Framework Agreement to expand the scope of membership of the ISA to all countries that are members of United Nations. This has not yet entered into force.
  • Inclusion of the UN members to the Alliance will put solar energy in global agenda with the universal appeal for developing and deploying solar energy.
  • At CoP23 Bonn it has been clarified that the efforts and targets set out by the International Solar Alliance (ISA) are over and above the INDCs.
  • Intended Nationally Determined Contributions (INDCs) outlines actions on climate change that countries intend to take in the post 2020 period under the new Paris international climate change agreement.

What important initiatives has the ISA undertaken so far?

  1. To date, the ISA has established five key programmes of action:
  2. Scaling up solar applications for agricultural use
  3. Affordable finance at scale
  4. Scaling up solar mini-grids
  5. Scaling up solar rooftop
  6. Scaling up solar e-mobility and storage.
  • To foster innovation and research in solar technologies, the ISA Solar Award (Kalpana Chawla Solar Award) has been created to recognize solar scientists doing extraordinary work across ISA member countries with a one-time corpus contribution of US$1.5 million contribution from the Government of Haryana.
  • International Solar Alliance (ISA) has institutionalized solar awards in collaboration with Government of Haryana (Kalpana Chawla Solar Award), Government of Madhya Pradesh (Acharya Vinoba Bhave international award for outstanding work in promoting solar pumps) and Government of Karnataka (Sri Visvesvaraya Award) to strengthen the institution.
  • To strengthen ISA’s partnership with the UN and its agencies and responding to the mandate received from the first Assembly of the ISA, the Secretariat has initiated follow-up actions for requesting a Permanent Observer Status of the ISA at the UN General Assembly.

How can the International Solar Alliance support member countries in solar deployment?

  • The ISA will help aggregate and harmonize demand across member countries, thus creating a large ‘buyers’ market’, with the objective of lowering costs for members, and catalyzing innovation and investments.

Can the International Solar Alliance help in ensuring access to low cost finance?

  • The ISA will be a facilitator of technology, knowledge and finance. At this stage, the ISA will not be funding projects directly, but will assist member countries in finding suitable bilateral or multilateral funding, and in developing innovative financial packages to bring down the cost of capital.
  • The World Bank and French Development Agency are developing a Solar Risk Mitigation Facility for this purpose.

Palau Joins International Solar Alliance

  • Recently, Palau, an archipelago of over 500 islands in Oceania became the 76th signatory country to join the International Solar Alliance.
  • Countries which have signed the agreement until now include India, France, Australia, the United Arab Emirates, the United Kingdom, Japan, amongst others. The agreement was opened for signature during the COP22 at Marrakech on November 15, 2016.

ISA in News

Universalization of membership of the International Solar Alliance (ISA)

  • All the Member States of the United Nations will now be able to join the International Solar Alliance, including those countries which are beyond the Tropics.

Solar Risk Mitigation Initiative

  • While the proportion of solar and wind generation is rising every year, it is still far from the scale needed to reach the sustainable development goals (SDGs) and to stay below the Climate Change Paris Agreement 2oC scenario.
  • To reach this objective, large amounts of private funding will have to be unlocked to complement the limited public financing available. 
  • The World Bank– Energy Sector Management Assistance Program (WB-ESMAP), in partnership with, Agence Française de Développement (AFD), International Renewable Energy Agency (IRENA) and International Solar Alliance (ISA) has developed the Solar Risk Mitigation Initiative (SRMI or “the Initiative”).
  • SRMI aims to support countries in developing sustainable solar programs that will attract private investments and so reduce reliance on public finances. 
  • It aims at supporting the development of bankable solar programs in developing countries leveraging private sector investments.

    This initiative offers development and climate financing for:

    (i) Technical assistance to help countries develop evidence-based solar targets;

    (ii) Ritical public investments to enable integration of variable renewable energy (VRE); and

    (iii) Risk mitigation instruments to cover residu­al risks perceived by private investors.

G) Miscellaneous

7. Indira Gandhi Prize for Peace, Disarmament and Development (TH, pg 11)

Context: The Indira Gandhi Prize for Peace, Disarmament and Development for 2019 will be conferred on renowned naturalist and broadcaster Sir David Attenborough.

  • Indira Gandhi Prize for Peace, Disarmament and Development is awarded annually by Indira Gandhi Trust since 1986 and not by any government body.
  • It is awarded to individuals or organizations in recognition of their creative efforts towards promoting international peace, and development.
  • It is also bestowed upon them for creating new international economic order and ensuring that scientific discoveries are used for the larger good of humanity and enlarging the scope of freedom.

Important Past Recipients:

UNICEF (1989), Muhammad Yunus (1998), M S Swaminathan (1999), Kofi Annan (2003), Sheikh Hasina (2009), Angel Merkel (2013), Indian Space Research Organization (ISRO) (2014), UN High Commission for Refugees (2015), Dr Manmohan Singh (2017), Centre for Science and Environment (CSE) (2018).

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