Low Retail Inflation.

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▪Why in news?
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Consumer price inflation had slipped to 1.54%.
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▪Why there is a reduced inflation?
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Activity in the manufacturing sector has also slowed down.
GST-related adjustment and subsequent destocking may have reduced industrial growth.
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▪Why it is a matter of concern?
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Moderate inflation levels are needed to drive consumption, under the assumption that higher levels of spending are crucial for economic growth.
Monetary Policy Committee (MPC) fixed the inflation levels to maintain in the zone between 2 and 4%.
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▪What is now expected of the RBI?
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RBI has been maintaining the Repo rate at 6.25% since October 2016.
Since the inflation is lower now, a cut in the rate is expected.
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▪Why RBI should be cautious before lowering Repo?
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Several State governments have taken fiscally expansive measures like loan waivers.
This is will increase the purchasing power of people which in turn might increase the inflation.
The monsoon and its effect on prices is yet to be felt.
The impact of the introduction of the GST, will reflect in the prices.
Increased allowances under the Seventh Central Pay Commission’s award could also transmit into price gains.
All these would have had a complementary effect of low inflation.
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Source: The Hindu

What is cryogenic engine

Significance in Space Programme

• Cryogenic means low temperature. It refers to technology of sub zero temperatures and cryogenic engines use liquid oxygen as the oxidizer and liquid hydrogen as the fuel. Oxygen can be kept in liquid state below – 183° C temperature, while hydrogen requires temperature below – 253° C to be in liquid form. Moreover, the liquid oxygen is very reactive. So, much care is required to ensure that both come in contact only in the combustion chamber. Use of the liquid fuel instead of solid facts helps the engine produce greater thrust. The engine’s capability in thus of placing a far heavier payload.
• Apart from this technological care, two quite different state of temperature are required to be maintained. Low temperature is to be maintained to keep propellant in liquid state while very high temperature and pressure are created by combustion to create a greater thrust in the combustion chamber. 
• The advantage of the cryogenic engine was that it would develop 1 ½ times the thrust of conventional liquid rocket engines using fuel storable at room temperature.
• ISRO crossed an important milestone in the development of indigenous cryogenic upper stage for the GSLV when the first cryogenic engine was ignited at the Liquid Propulsion System centre, Mahendragiri. The engine made by LPSC was expected to be used as the upper stage in the third launching of the GSLV.
• The GSLV in capable of injecting 2500 kg. Class communication satellites into Geo-synchronous circular orbits at an altitude of 3600 km. Cryogenic engines are very useful in launching of heavy satellite launch vehicles like GSLV. India will become self-reliant in its space programmer after the development of this technology. The realization of the cryogenic technology would also help India to become a partner in space explorations and activities of other countries. Commercialization of this technology will get India precious foreign currency.

A cryogenic engine is a engine that uses a cryogenic fuel or oxidizer , that is, its fuel or oxidizer (or both) are gases
liquefied and stored at very low temperatures.
Cryogenic Engine makes use of Liquid Oxygen (LOX) and Liquid Hydrogen (LH2) as propellants which liquefy at -183 deg C and -253 deg C respectively. LOX and LH2 are stored in their respective tanks. From there they are pumped in to turbo pump by individual booster pumps to ensure a high flow rate of propellants inside the combustion/thrust chamber. The major components of a cryogenic rocket engine are combustion/thrust chamber, igniter, fuel injector, fuel cryo pumps, oxidizer cryo pumps, gas turbine, cryo valves, regulators, the fuel tanks and a rocket engine nozzle.
Hope this will Help :)

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Darjeeling Unrest

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Indian express. 19-Jun-2017
What is the issue?
Separate statehood movement of get renewed and intensified in Darjeeling district of West Bengal.

What sparked the renewed protest?

Gorkha agitation stir renewed after West Bengal government makes Bengali mandatory in all schools in the region.
Gorkha Janmukti Morcha-led by Bimal Gurung intensifies its demands for a separate state of Gorkhaland calling an indefinite bandh in the region.

Nepali population:

Census figures over the years show that the state with the largest Nepali-speaking population is West Bengal — 10.23 lakh in 2001, which is almost twice as many as in Assam, the next highest state with 5.65 lakh.
Sikkim has the highest concentration of Nepali-speaking people, at 62.6 per cent.
Although the Nepali-speaking segment makes up just 1.2 per cent of Bengal’s population.
Darjeeling evokes more interest in Nepal than any other Indian region where Nepali-speaking persons are settled.
The idea of a “Greater Nepal” still motivates a section of Nepal activists who want Darjeeling restored.

How strong is the cultural bridge?

In the late 1970s, Nepali scholars from Darjeeling as well as Assam led a movement for recognition of the language under the Eighth Schedule.
The Morarji Desai-led government, however, turned it down. Sikkim, which became part of India in 1975, joined the movement and the language was eventually given that status in 1992.
Darjeeling’s Nepali-speaking population also contributed to the growth of trade union politics, their affiliations mostly to the CPI in the initial stages.
Darjeeling, along with Sikkim, has also been where promotion of the Nepali language and literature has been largely concentrated.
Sikkim and a couple of the other Northeastern states, on account of their high concentration of Nepali-speaking people, too have made efforts to promote Nepali culture and language.
Each year, Sikkim celebrates the poet’s birthday on July 13 as Bhanu Jayanti, with literary figures from both countries invited.
Why the Nepali people agitate?

The tactful and rigid segregation of workers from the British era to the line of ethnicity in the hills, where the Nepalese were brought in and the plains, where the Chottanagpur migrants worked, rendered one community hostile against the other.
The few Bengalis present in the hills were and have always been the babus, working for the British and then the State. The marwaris have controlled most of the wealth, further isolating the Nepali population.
The Nepalese find themselves reduced to second class citizens, at the hands of these otherwise miniscule inhabitants.
The movement led by the Gorkha National Liberation Front, projected the CPM-led government in Bengal as anti-Nepali.
The demand for Gorkhaland has always found its support among the tea plantation workers. Kipat (ownership of land by a community) and Maato (mud) remain central to the movement.
Is there any peace process took place before?
Long back, the Gorkhaland movement was called off following a tripartite agreement that led to creation of an autonomous hill council.

India - Japan Nuclear Deal

Source: The Hindu

Why in news?
Japan’s Parliament, the Diet, had recently approved the India-Japan civil nuclear energy deal.

What is the significance?

Japanese PM believes that nuclear exports are key to kick-starting the Japanese economy.

2008 waiver it received from the Nuclear Suppliers’ Group so far has had limited tangible benefits for the country’s power industry.

This deal represents hope that it might finally begin paying off.
It is also a necessity for enabling India’s bilateral nuclear deals with other countries.

Key elements of certain reactors like the AP 1000 and EPR, including safety components and domes, are a near-Japanese monopoly.

Has Japan lost significance in nuclear market?

Circumstances in the nuclear industry are undergoing tumultuous changes.
It makes the India-Japan deal less significant than it would have once been.
Recent developments have diminished Japan’s previously formidable nuclear capabilities.

The most dramatic example is that of Toshiba, once a titan of the Japanese nuclear reactor industry that is currently struggling to stay afloat following the enormous losses.

Hitachi Ltd., another nuclear heavyweight, also booked ‘an estimated $588 million write-down for fiscal 2016.

The company said ‘demand for nuclear fuel in the U.S. was unlikely to grow as strongly as had been expected’.
In the aftermath of the 2011 Fukushima nuclear disaster, the nuclear industry is facing a global crisis.
Stricter safety regulations have spiked the costs of constructing plants and ‘some countries have become more cautious about new reactors.

In Japan there has been no domestic construction on a new reactor for the past eight years.
Hitachi, Mitsubishi and Toshiba are all focussing on repair and maintenance of existing plants rather than on construction of new ones.
The emergence of cheap shale oil and gas has made competition in the energy sector tougher than ever.

Wind and solar power generation are also growing as viable, alternative energy sources.

According to the International Atomic Energy Agency (IAEA), just three nuclear reactors started construction worldwide last year, and only 51 were begun between 2010 and 2016.
In contrast 20 to 30 new were being built every year in the 1960s and 1970s.

Source: The Hindu

GSAT 19

Why in news?

June 6 launch of GSAT-19, is perhaps ISRO’s most important mission in the last three decades.
This is bigger in technological significance than even the hugely popular Chandrayaan or Mangalyaan space missions.

What is the background of the issue?

Behind the success of the launch is nearly three decades of hard work in taming cryogenic technology and an interesting history of this technology was denied to ISRO by the United States in the early 1990s, forcing it develop it on its own.
ISRO had planned the development of a cryogenic engine way back in the mid-1980s when just a handful of countries the United States, the erstwhile USSR, France and Japan had this technology.
In 1991, ISRO and the Russian space agency, Glavkosmos, had signed an agreement for supply of two of these engines along with transfer of technology.
However, the United States, which had lost out on the engine contract, objected to the Russian sale, citing provisions of Missile Technology Control Regime (MTCR) that neither India nor Russia was a member of.
In an alternative arrangement, Russia was allowed to sell seven, instead of original two, cryogenic engines but could not transfer the technology to India.
But ever since the cancellation of the original Russian deal, ISRO got down to develop the cryogenic technology on its own at the Liquid Propulsion Systems Centre at Thiruvananthapuram.

It took more than a decade to build the engines and success did not come easily.

What is a Cryogenic engine?

Cryogenics is the science that addresses the production and effects of very low temperatures.

A cryogenic rocket engine is a rocket engine that uses a cryogenic fuel or oxidizer.

That is, its fuel or oxidizer (or both) are gases liquefied and stored at very low temperatures.

Notably, these engines were one of the main factors of NASA's success in reaching the Moon.

Amongst all rocket fuels, hydrogen is known to provide the maximum thrust.
But hydrogen, in its natural gaseous form, is difficult to handle, and, therefore, not used in normal engines in rockets like PSLV. However, hydrogen can be used in liquid form.

The problem is hydrogen liquefies at very low temperature, nearly 250 degrees Celsius below zero.

To burn this fuel, oxygen also needs to be in liquid form, and that happens at about 90 degrees Celsius below zero.

Creating such a low-temperature atmosphere in the rocket is a difficult proposition, because it creates problems for other material used in the rocket.
That’s why cryogenic upper stage engines are used.

What are the specifications of the project?

The launch is a giant leap for ISRO because of the rocket it is using.
The mission happens to be the first “developmental” flight of the next generation Geosynchronous Satellite Launch Vehicle, called GSLV-MkIII with an entirely indigenous cryogenic upper stage.

This cryogenic stage, that involves handling fuel at very low temperatures, is crucial to providing the extra thrust required by the rocket to carry heavier satellites deeper into space.

GSLV-MkIII is meant to carry payloads up to four to five tons and that was not possible with conventional propellants used by ISRO’s main launch vehicle, called PSLV.

PSLV can take satellites only up to 2 tons to orbits and that too until orbits of 600-km altitude from the earth’s surface.
It will not just help ISRO probe deeper into space but will also bring it extra revenue, enabling it to make commercial launches of heavier satellites.

By it successive successful launches ISRO once again proved India’s Space Exploration capability to the world.

Source: Indian Express

Regional comprehensive economic partnership

Regional Comprehensive Economic Partnership

What is the issue?

There’s a rush to finalise RCEP this year which is pushing India into covering most tariff lines that destroy its economy.

What is RCEP?

RCEP is being negotiated between India and 15 other countries including the 10-member Asean, Japan, South Korea, New Zealand, Australia and China.
India had very rightly maintained a cautious approach in its FTAs on goods, intellectual property rights, and many new issues such as investment, government procurement and competition policy.

Why RCEP is becoming a disaster for India?

There was clearly huge pressure on India to conclude negotiations this year and to make major concessions in goods, services and investment at the ministerial of the RCEP in Hanoi.
It has the potential to overthrow India’s policies of rural development and industrialisation especially ‘Make in India’, and the promise of the Prime Minister to provide accessible healthcare and medicines to all.
Most important, it threatens the policy flexibility and sovereignty to pursue independent economic, social and environmental policies.
In goods trade, India has already agreed to give up the three-tier tariff reduction proposal that offered different coverage for Asean, Japan and South Korea, and a much lower level of tariff reduction coverage for New Zealand, Australia and China.
In agriculture and allied products, the plantation sector is already reeling from the impact of the India-Asean FTA even with relatively high protection of agriculture and a tariff-coverage of 73-80%.
If tariff cuts cover 92-80% of products, the impact will be huge.
On the other hand, New Zealand’s export-oriented dairy products will decimate India’s growing dairy sector, which is still largely small-scale.
If India has to cut duties on 92% of goods in RCEP, India will face threats from both Asean and China.

What are the other possible threats to Indian economy?

E-commerce commitments, if any, will allow companies such as Alibaba from China to displace Indian manufacturing especially in the SME segment.
Further, India is being asked to eliminate export restrictions on minerals and raw material by Japan and South Korea, which may threaten domestic raw material availability.
India is openly pitching services as its offensive area of interest and may be willing to sacrifice goods tariffs for gains in services.
This can be the most dangerous of India’s current trade policy stance.

India has demands for both Mode 3 (investment) and Mode 4 (movement of people) with a proposal for a RCEP business visa for professionals.
India’s demand for Mode 4 is unlikely to be granted.

What India hopes to gain in Mode 3 for its outward FDI is not clear as it is not competitive in most services except for IT and ITES.

India is under heavy pressure to agree to the investor state dispute settlement provision in RCEP without the safeguards provided in the Model BIT.

The investment chapter in RCEP is also pitching for strong provisions on IPRs.
Agreeing to data exclusivity, extending patent terms and unduly strong enforcement measures will weaken the entire generic medicine sector and take away several health safeguards in India’s Patent Act, notably section 3(d).

This will make medicines inaccessible not only for Indian patients but for those in the entire developing world.

In addition, since India has rightly fought against ‘TRIPS plus’ provisions in its FTA negotiations with EU and European Free Trade Association, there is no rationale for it to change its stance in RCEP.

Source: Business Line

India Japan's plan for Africa

While China has been able to attract all global powers towards its OBOR initiative, this increases tensions for India from various viewpoints. Japan also faces similar fate as India in terms of relations with China (Senkaku Islands dispute) and a foe’s foe is a friend. Let the issue develop further and we will discuss it in detail once some op-eds come up related to it.
From UPSC perspective, following things are important:
Prelims level:  Asia Africa Growth Corridor, Mombasa port ☞ (Mark it on map and note related geographical features)
Mains level: India Africa relations. Also try to explore them from the prism of China and Japan involvement in African subcontinent and what it means for India. India Japan relations. India and Japan have been partners for a long time and Japan has provided assistance to India in multiple fields.
 News:
India and Japan unveiled a vision document for the Asia Africa Growth Corridor, proposed by the Prime Ministers of the two countries last November
Proposal for growth corridor was presented to the Board of Governors of African Development Bank
More details are likely to be firmed up by September in time for Japanese Prime Minister Shinzo Abe’s visit to New Delhi
Different from OBOR:
Unlike China’s One Belt One Road (OBOR) project, about which India has raised several concerns, the Asia Africa Growth Corridor is conceived as a more open and inclusive programme that will be based on more consultations and keep people as the centre piece rather than just trade and economic ties
Four key elements:
Enhancing capacity and skills
Building quality infrastructure and connecting institutions
Development and cooperation projects in health, farming, manufacturing and disaster management and
People-to-people partnerships
Important partners in mutual growth:
Corridor will facilitate greater trilateral or triangular cooperation among Japan, India and Africa as a win-win-win
As African countries continue to grow against the background of their abundant resources and growing population, they are becoming important partners of Japan and India with deeper relationships, politically and economically
Greater synergy is expected to emerge between Japan’s technology and capital and India’s strong network and experiences in Africa
Greater cooperation sought:
Japan’s Ambassador also called for greater cooperation between Indian and Japanese firms in furthering Africa’s development
He urged Indian investors to participate in the new economic zone coming up around Kenya’s Mombasa port with Japan’s assistance

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Con of GM mustard

Why in news?

Genetic Engineering Appraisal Committee (GEAC) recently cleared the proposal for genetically modified (GM) mustard.

How effective was Bt Cotton?

Bt cotton promised of higher yield and lower pesticide usage in the 1990s.
Despite increased fertilisers and irrigation, the expectations of enhanced cotton yield have not been realised.
Most of the countries that have higher cotton yields than India do not grow GM cotton.
What are the shortcomings of GM Mustard?

Yield - The yield claims on GM mustard are not very reliable.
U.S. and Canada uses GM mustard.
But the highest yields in mustard are from the five countries which do not grow GM mustard — U.K., France, Poland, Germany and Czech Republic.
Evaluation - The risks to health, environment and agriculture have not been evaluated.
Those inadequate tests which were conducted on Bt brinjal were also ignored, even though mustard is far more extensively grown and consumed than brinjal.
HT (herbicide tolerant) GM crops have been condemned by a number of medical professionals.
Weed - A herbicide-tolerant crop promotes constant exposure to a single herbicide — which eventually results in weeds becoming resistant.
Health - A scientific report from Argentina found a fourfold increase in birth defects and a threefold increase in childhood cancers in HT soya areas.
Studies have shown a strong correlation between growth of GM crops & herbicides used in U.S. and diseases such as acute kidney injury, diabetes, autism, Alzheimer’s and cancers.
Seventeen of the 20 most developed countries — including Japan, Russia, Israel and most of Europe — refuse to grow GM crops.
The millions of poor women who depend on weeding to support their family will be displaced.
Indian will lose its seed diversity and the international competitive advantage of its non-GM mustard.
What should be done?

If India wants to increase its mustard yield rapidly and safely, this can be done by adopting the practice of System of Mustard Intensification.
Successful trials have been done in Bihar through a World Bank and results showed higher yields and better income.

Source: The Hindu
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Universal basic income

What is a Universal Basic Income?
•    A universal basic income (UBI) is an unconditional and universal right. It requires that every person should have a right to a basic income to cover their needs, just by virtue of being citizens.
•    The Economic Survey (ES) 2016-17 says the time has come to think of UBI for a number of following reasons
•    Social Justice - A UBI promotes many of the basic values of a society which respects all individuals as free and equal.
•    Poverty Reduction - Conditional on the presence of a well-functioning fnancial system, a Universal Basic Income may simply be the fastest way of reducing poverty.

•    Agency - The poor in India have been treated as objects of government policy. An unconditional cash transfer treats them as agents, not subjects.
•    By taking the individual and not the household as the unit of beneficiary, UBI can also enhance agency, especially of women within households.

•    Administrative Effciency -  It is a way of ensuring that state welfare transfers are more effcient so that the state can concentrate on other public goods.

What are its basic principles?

The main features of UBI are that it should be universal and not targeted, it should be unconditional and not tied to work or employment, and it should be in cash.
UBI is envisaged as a method of redistribution of resources from the rich to the poor.
It is envisaged as providing all persons (especially, the poor) with an income to lead a dignified life, with basic needs taken care of.
The UBI proposed in the ES is hostile to each of these objectives.
What are the flaws in proposed UBI?

The first wrong committed by the ES is that its proposal constitutes an attack on welfare schemes.
The ES wants UBI not to supplement, but to replace, all existing social welfare schemes.
European scholar Mr. Parijs says, that while fighting towards greater income security, we must not neglect the importance of providing people with quality basic education and health care.
It is thus technically and ethically wrong to compare the costs and benefits of UBI with those from a range of subsidies relating to food and nutrition (PDS, school meals, ICDS), education etc., as is done in ES.
The second wrong is, the argument that the UBI should also replace all current in-kind (such as food subsidies) and cash transfers (such as maternity benefit).
The third wrong, is the ES’s assertion that “UBI is not framed as a transfer payment from the rich to the poor.”
A basic income needs resources. Thus, the comparatively rich would need to pay both for their own basic income and for much of the basic income of the comparatively poor.
While the basic income is given to all, the manner in which the basic income is funded has to ensure that society transfers resources from the rich to the poor.
The ES also does not propose any new resource mobilisation or taxation to meet the goal of UBI.
Rather, it says the existing programmes will have to be cut to fund the universal basic income. There is no intention of making the rich pay for the basic income.
What are the justifications provided by ES?

UBI reduces the incentive to work - The levels at which universal basic income are likely to be pegged are going to be minimal guarantees. Thus they are unlikely to crowd incentives to work.
Should income be detached from employment? Any society where any form of inheritance or accepting nonwork related income is allowed, already detaches income from employment.
Should income be unconditional, with no regard to people’s contribution to society? Individuals, in most cases contribute to society. In fact, UBI can also be a way of acknowledging non-wage work related contributions to society.
What a genuine UBI would entail?

UBI equivalent to the expected income transfer under MGNREGA itself would cost Rs. 510,000 crore.
This is more than 10 times the allocation in the current Budget for MGNREGA (Rs. 48,000 crore).
Resource mobilisation has to increase ten-fold forfor India to afford the universal basic income without cutting back on other social welfare programmes.
Unless the government seriously increases tax resources, the proposal for a universal basic income is at best a fantasy idea.