16 March 2023

DAILY CURRENT AFFAIRS ANALYSIS

1 – PM MITRA Park Scheme: GS III – Topic Government Policies and Interventions:

Context:

• According to Union Minister of Textiles Piyush Goyal, the Prime Minister MITRA (Mega Integrated Textile Region and Apparel) scheme’s implementation States would shortly be announced by the Ministry of Textiles.
• The Minister claimed that the challenge route was used to identify the States, and that the PM MITRA parks will offer the ideal eco-system for the textile sector to congregate in one place, with plug-and-play infrastructure, and boost the competitiveness of the textile value chain. The Confederation of Indian Textile Industry’s three-day Global Textile Conclave was inaugurated by the Minister. It will also promote the five F (farm, fibre, factory, fashion, and foreign) vision of the prime minister.

About:

• Through a Public Private Partnership (PPP), a Special Purpose Entity that will be under the management of the Central and State Governments will build a park.
• A textile-related incubation facility, a common processing facility, a common effluent treatment facility, as well as other amenities like design and testing centres, will all be present in each Park.
• Throughout the duration of the concession, the Master Developer will construct and maintain the Industrial Park.

Funding:

• For each brownfield park and each greenfield MITRA park, the centre would contribute up to Rs 200 crore and up to Rs 500 crore, respectively, towards the construction of shared infrastructure.
• A greenfield project must be started from scratch, whereas a brownfield project is one that has already been worked on.
• Individuals who are entitled to incentives:
• Each of these parks will receive an additional Rs 300 crore as a competitiveness incentive support in order to promote the early development of textile manufacturing facilities.
• If investors create “anchor facilities” that employ at least 100 people, they would be eligible for incentives worth up to Rs 10 crore each year for a maximum of three years.

Significance:

Reduce the expense of logistics

• It will reduce logistics expenses and boost the value chain of the textile sector, increasing global competitiveness.
• High logistics costs are thought to be impeding India’s desire to enhance textile exports.

Producing Employment

• It is estimated that each park will create 1 lakh direct jobs and another 2 lakh indirect jobs.

Generate FDI

• The parks are crucial to attracting foreign direct investment (FDI).
• Only 0.69% of all FDI inflows between April 2000 and September 2020 went to India’s textile industry, totaling Rs 20,468.62 million.

 Source The Hindu

2 – Trade Policy of India: GS III – Topic Indian Economy:

Context:

• The administration will unveil a new foreign trade strategy next week, which may include measures to increase exports of goods and services and rein in the out-of-hand import bill. The current trading approach was developed in 2015. Due to the unique circumstances, its five-year term was extended by one year when it concluded a week after the country was placed under a pandemic lockdown. It is less warranted to extend the prior policy past March 2021, especially with the current six-month term that pushes the expiration date to September 30.

What Is the Meaning of an International Trade Policy?

• The Government of India’s Foreign Trade Policy is made into a binding document by the Foreign Trade Development and Regulation Act of 1992.
• Since the 1991 economic reforms, when it was reviewed and updated every five years, the FTP has served as the compass for all stakeholders.
• The basic objective of international trade policy is to encourage trade by reducing transaction and transit costs and timeframes.
• A FTP lays forth the regulations for foreign trade and reveals the government’s position on a variety of parallel but important policy issues, including, among others, technology flow and intangibles.

 Why is a Modern Foreign Trade Policy Important?

• India’s position and alignment with flagship programmes like the “Local for Global” and PLI (Production Linked Incentive) schemes, the WTO’s decision to reject India’s export incentive programmes, a long overdue review of the Special Economic Zone (SEZ) scheme, shifting geographic profiles of India’s export basket, and FTA implications must all be made clear.
• A WTO dispute panel had determined in 2019 that the export incentives offered under the FTP violated India’s WTO agreement.
• Impact on companies with an export-oriented focus: Another argument for amending the FTP is the fact that several ad hoc, contradictory, and inconsistent revisions to the 2015 FTP have had a negative effect on some export-oriented businesses.
• The 2015 FTP promoted exports by directly issuing duty-credit coupons in proportion to exports. The maximum export incentives were nevertheless limited by the government to Rs. 20 million for goods in 2020 and Rs. 20 million for services in 2021.
• Also, the changes to service incentives were retroactively announced in September 2021 with an April 2019 implementation date.
• Decreased Expenditure and Incentives: The annual export incentives known as the Merchandise Exports from India Scheme (MEIS) and Services Exports from India Scheme (SEIS), both of which were valued Rs. 51,012 crore, were replaced by the RoDTEP plan incentive, which was worth Rs. 12,454 crore.
• The remaining Rs. 38,558 crore was put into PLI to help a select few sectors.
• Infrastructure hiccups: The typical turnaround time for ships in India is roughly three days, while the global average is 24 hours. This is because India’s export infrastructure, including ports, warehouses, and supply chains, has not been effectively improved. Tractor export incentives, which were previously offered at 3%, are now only offered at 0.7%.
• MSMEs are in trouble since they are crucial to achieving the difficult export targets and account for about 29% of the GDP and 40% of global trade. Yet, the spike in input and petroleum prices is having a detrimental impact on the bottom lines of MSMEs.
• Due to the rising costs of raw materials like plastics and steel, as well as a shortage of shipping containers and labour, MSMEs are having difficulty taking full advantage of the global boom in demand.

What changes to the New FTP might be made?

• To help MSMEs out of their difficulty, the SEIS gives incentives of 3-7% of net foreign exchange revenues to Indian service exporters of registered services.
• Faster GST refunds to international services and a modification to the minimum cap on the amount of net foreign exchange earnings that can be claimed under the scheme are both crucial with the new FTP.
• The government must also encourage MSMEs in using the export potential in current tariff lines if it hopes to increase the proportion of exporting MSMEs and increase MSME exports by 50% in 2022–2023.
• Extra Exporter Incentives: If the MSME category’s incentives for retail and wholesale merchants are also extended to them, the new FTP might aid exporters.
• The new FTP must enable exporters to utilise technology in the context of global trade. This will enable MSMEs to compete on an international scale.
• Infrastructure Improvement: Exporters would be better able to participate in a highly competitive market if there was a well-developed infrastructure network, including warehouses, ports, special economic zones (SEZs), laboratories for quality testing, certification centres, etc.
• India needs to invest in enhancing its export infrastructure in order to compete with technologically advanced countries like China.
• Also, it needs to adopt modern business practises, which can be accomplished by digitising the export process. Costs will go down, and time will be saved.
• GST Export Benefits: Because FTP does not now cover the GST export benefit, some exporter classes have had their eligibility for export benefits denied.
• Hence it is vitally important to reduce the gap between the two policies. Furthermore, it is critical that administrative procedures do not impede the efficient distribution of GST refunds.

WTO-compliant initiatives:

• This is what the FTP should be designed around. The WTO seeks to deter governments from heavily subsidising exporters in order to ensure that all nations compete on an equal level.
• Although the Indian government is well aware of the need to comply with WTO requirements, it has already taken significant steps to abolish projects driven by subsidies.
• More basic work must be done in order to boost exports and ensure that Indian exports remain competitive in the global market.
• Further actions To build an intended designed and directed policy stance that directs both the Center and private enterprises for the progress of the nation’s economy, the decision-makers must right away widen their field of consideration to encompass all stakeholders.
• These elements should also consider the current paradigm, including the urgent need to replace fuel imports, taking advantage of improvised logistics, and igniting entrepreneurial zeal.
• The new FTP will gradually endeavour to lift export prohibitions, assess the operational and legal framework to reduce transit costs, and create a low-cost operating environment through developed logistics and utility infrastructure. This is due to the pandemic’s significant economic impact.

 Source The Hindu

3 – NCBC: GS II – Topic Statutory and Non-Statutory Bodies:

Context:

• The Union government reported on Wednesday that it has only chosen a chairperson and one member to the National Commission for Backward Classes (NCBC), in answer to a Rajya Sabha inquiry regarding why the Commission still required a vice-chairperson and members.

 About:

• The 102nd Constitution Amendment Act of 2018 gave the National Commission for Backward Classes constitutional protection (NCBC).
• It has the authority to investigate welfare claims and initiatives for academically and socially underprivileged groups.
• Previous to this, the NCBC was a statutory organisation under the control of the Ministry of Social Justice and Empowerment.

What is the past of the NCBC?

• Two Backward Class Commissions were appointed under Kaka Kalelkar and B.P. Mandal in the 1950s and the 1970s, respectively.
• The Kaka Kalelkar Commission is also known as the First Backward Classes Commission.
• In the 1992 Indra Sawhney case, the Supreme Court ordered the government to set up a permanent committee to review, analyse, and recommend the inclusion and exclusion of various Backward Classes for the purpose of benefits and protection.
• The National Commission for Backward Classes (NCBC) was created in 1993 as a result of the National Commission for Backward Classes Act, which was approved by parliament.
• The 123rd Constitution Amendment bill of 2017 was put out in Parliament to better safeguard the interests of underrepresented groups.
• A new law passed by Parliament repealed the National Commission for Backward Classes Act of 1993, rendering the 1993 Act ineffective.
• The President approved the bill in August 2018, giving NCBC legal stature.

What Kind of Structure Has NCBC?

• The President, through a warrant carrying his signature and seal, appoints the Chairperson, the Vice-Chairperson, and three more members to the Commission.
• The Chairman, Vice-Chairperson, and other Members’ periods of office are determined by the President.

Which Constitutional clauses apply to NCBC?

• In accordance with Article 340, it is crucial to identify those “socially and educationally backward classes,” understand the factors that contribute to their backwardness, and present measures to help them.
• The 102nd Constitution Amendment Act introduced new Articles 338 B and 342 A.
• The version also makes changes to Article 366.
• According to Article 338B, the NCBC has the authority to look into complaints and welfare initiatives involving socially and educationally disadvantaged people.
• Under Article 342 A, the President has the power to designate socially and educationally disadvantaged classes in various states and union territories.
• After speaking with the governor of the pertinent State, he may take this action.
• However, a measure approved by Parliament will be required if the list of disadvantaged classes is to be altered.

What responsibilities and power does the NCBC have?

• To determine how well the protections provided to socially and educationally disadvantaged classes under the Constitution or under other laws are working, the commission investigates and keeps track of all relevant concerns.
• The socioeconomic advancement of the economically and socially undeveloped classes within the Union and any State is taken into consideration, counsel is offered, and an assessment is made.
• Reports on the effectiveness of those protections are given to the President once a year and at other times the Commission may deem appropriate. The President delivered these reports to each House of Parliament.
• Every time such a report, or any portion thereof, refers to a subject that has an impact on the State Government, a copy must be given to that State Government.
• NCBC is required to carry out whatever extra responsibilities the President may, according to the terms of any laws established by Parliament, by regulation, define with regard to the defence, welfare, development, and advancement of the economically and socially disadvantaged classes.
• It has all the power of a civil court while hearing a matter.

Source The Hindu

4 – Animal Husbandry Sector of India: GS III – Topic Indian Economy:

Context:

• A total of 77.56 crore is allocated to animal husbandry in the Puducherry budget for 2023–2024.
• One of the key steps to increase the revenue of livestock producers is the government’s plan to pay the premium amount due by farmers, less the subsidies supplied by the Central government.

About:

• Selective breeding and livestock management are regarded as components of animal husbandry. With management and care, the genetic traits and behaviours of animals are developed further for financial advantage.
• A sizable portion of farmers make their living primarily from animal husbandry. About 55% of people living in rural areas rely on it for a living.
• Livestock presently makes for 28.63% of the total Gross Value Added (at Constant Prices) for the agriculture and allied industry, up from 24.32% in 2014–15, according to the Economic Survey–2021 (2018-19).
• The majority of cattle owners in the world are found in India.
• There are 535.78 million animals in the entire country, up 4.6% from the Livestock Census-2012, according to the 20th Livestock Census.
• There are many possible facets to raising animals.
• For instance, the 1970 execution of Operation Flood helped dairy producers control their own growth, increased milk production (“a flood of milk”), enhanced rural incomes, and made sure that customers were paying fair rates.

Importance:

• It has significantly increased women’s earnings and social involvement while also significantly advancing their liberation.
• It is an important risk-reduction tactic for small and marginal farmers, particularly in India’s rain-fed regions.
• It is at the heart of initiatives to decrease poverty from an equity and livelihood standpoint.
• The Inter-Ministerial Committee highlighted seven sectors of revenue increase, including livestock production, in order to meet the government’s objective of doubling farmers’ income by the year 2022.

Challenges:

• It is difficult to find superior breeding bulls.
• Several laboratories produce inferior quality sperm.
• insufficient feed supplies and poor handling of animal illnesses.
• For local breeds, there is no field-focused conservation strategy.
• Farmers’ infrastructure is poor, and they lack the services and expertise needed to boost productivity.

Governmental Initiatives to Advance This Industry:

Animal Husbandry Infrastructure Development Fund (AHIDF):

• About: The Farmer Producer Organizations (FPO), commercial dairy players, individual business owners, and non-profit organisations are all included in this first large government fund.

Launch:

• June 2020.
• The establishment cost of the fund is Rs. 15,000 crore.
• Goal: To promote private investment in dairy processing, value addition, and infrastructure for cow feed.
• Incentives will be given for the construction of factories to export specialised items.
• A niche product is one that caters to a certain area of a larger industry or market. Niche products typically cost more than more generic ones, but not always.
• Also, it will aid in the development of various sized animal feed plants, including silage production facilities, mineral mixing plants, and animal feed evaluation labs.

National Program for Animal Disease Prevention:

• It has been implemented for Foot and Mouth Disease (FMD) and Brucellosis to ensure that the population of cattle, buffalo, sheep, goats, and pigs is fully immunised, with a total cost of Rs. 13,343 crore.
• The goal of Rashtriya Gokul is to protect and advance local cattle breeds.
• to boost milk production and the cash that comes from it for the farmers.

The National Livestock Mission:

• launched in 2014–2015.
• to provide capacity building for all stakeholders and development in cattle production systems on both a quantitative and qualitative level.
• Program for National Artificial Insemination: to offer fresh advice on conceiving female breeds.
• to boost the effectiveness of the breed by preventing the spread of particular genital infections.

How to Proceed:

• The burden on the agriculture sector will decrease if investments are made as soon as feasible, even as the country tries to recover from the pandemic-caused economic depression, which would have a huge positive impact on the entire economy.
• Employment and climate change are directly impacted by the animal husbandry business, and better infrastructure may make processing plants more energy-efficient and lower their carbon footprint.

Source The Hindu