Current Affairs 28th August

Centre to ease path for monetisation #GS3 #Economy

Union Finance Minister Nirmala Sitharaman will soon chair a meeting of the Financial Stability and Development Council (FSDC) to nudge financial regulators to relax and harmonise investment norms for instruments such as Infrastructure Investment Trusts (InvITs) to be used to monetise public assets such as highways, gas pipelines and railway tracks.

The meeting of the council entrusted with enhancing coordination among financial sector regulators — RBI, SEBI, IRDA and PFRDA — assumes significance after the government unveiled the National Monetisation Pipeline (NMP), listing assets across sectors that are to be monetised for an estimated Rs. 5.96 lakh crore over four years.

With the economy still not out of the woods from the COVID-19 pandemic, and Ms. Sitharaman urging industry to look beyond banks and tap the markets for their financing needs, steps to ease access and encourage investments in the corporate bond market are also expected to be discussed by the FSDC. An FSDC meeting has been planned for some time, and it will be convened very soon.

The NITI Aayog, which has steered the NMP, has emphasised the importance of expanding the investor base and scale of monetisation instruments such as InvITs and Real Estate Investment Trusts (REITs), and flagged concerns about regulators taking varying stances on such investments. Measures announced in the Union Budget to enable InvITs and REITs to borrow money from FPIs and issue debt securities are also expected to be reviewed by the FSDC, along with the efficacy of changes implemented by individual regulators.

Stock market watchdog SEBI, for instance, has recently reduced the minimum investment amount for InvITs and REITs to Rs. 10,000-Rs. 15,000 to enable retail investors to participate. The Pension Fund Regulatory and Development Authority (PFRDA) as well as the Employees’ Provident Fund Organisation (EPFO) have permitted investments of up to 5% of their corpus in InvITs, albeit with onerous conditions.

Investors’ participation

“The long-term nature of infrastructure projects requires active participation from investors looking at a similar return profile from their investments. However, the existing investment guidelines for insurance and pension funds limit the exposure of such funds to InvIT/ REIT assets,” the NITI Aayog has flagged in its guidebook for the NMP.

For insurers, the Insurance Regulatory and Development Authority (IRDA) has allowed an exposure to InvITs and REITs up to 3% of their own funds size or 5% of the units issued by a single trust, whichever is lower. Mutual funds, regulated by SEBI, can invest up to 10% of their assets in a single InvIT/ REIT.

“These need to be streamlined to ensure consistency,” the Aayog noted, besides highlighting inconsistencies across categories on the level of exposures. “For example: IRDA regulations do not permit investment of insurance funds in unlisted InvITs. Hence, a staggered approach for streamlining of investment guidelines and limits is envisaged to keep pace with the growth in the InvIT market starting with the allocation of insurance and pension funds towards unlisted InvITs,” it said.

Credit rating

The IRDA and the PFRDA also mandate a high credit rating for InvITs to be eligible for their long-term investments, and the credit enhancement mechanisms for boosting the usually lower ratings of infrastructure projects may also figure in the FSDC’s deliberations.

A Credit Enhancement Guarantee Corporation, announced in the Union Budget of 2019, is not yet operational, while a partial credit guarantee enhancement scheme from the Reserve Bank of India has some limitations in its present form.

Restrictions pertaining to investments in the overall corporate bond market are also likely to be flagged at the FSDC, with SEBI recently mooting an urgent rethink from the RBI, the IRDA and the PFRDA on norms constricting debt market exposures, in order to enable a quicker economic recovery.

Deepar Beel breathes easy after eco-sensitive zone notification #GS3 #Environment

Ministry of Environment, Forest and Climate Change notified the eco-sensitive zone of Deepar Beel Wildlife Sanctuary on the southwestern edge of Guwahati.

Romila Boro, a sexagenarian resident of Chakardeo, the sanctuary’s “guardian village”, hopes the notification will bail the constricted wetlands out. But she is sad that the “good news” came eight years too late.

It was in 2014 that her husband Koliya Boro was run over by a train while trying to stop it to prevent hitting an approaching herd of elephants. He was one of the earliest conservationists of the area. “The zonation should help, but Deepar Beel’s water has become toxic and lost many of its aquatic plants that elephants would feed on. The wetlands can breathe easier only if the railway track is diverted,” said Chakardeo’s dairy farmer and green guard Pramod Kalita.

Deepar Beel is one of the largest freshwater lakes in Assam and the State’s only Ramsar Site, besides being an Important Bird Area. The wetlands have for decades been threatened by a railway track — set to be doubled and electrified — on its southern rim, a garbage dump and encroachment for human habitation and commercial units.

The wetlands expand up to 30 sq. km in summer and reduces to about 10 sq. km in winter. The wildlife sanctuary measures 4.1 sq. km within this wetland. The notification specified an area “to an extent varying from 294 metres to 16.32 km” as the eco-sensitive zone with the total area being 148.9767 sq. km.

No new commercial hotels and resorts shall be permitted within 1 km of the boundary of the protected area or up to the extent of the eco-sensitive zone, whichever is nearer, except for small temporary structures for eco-tourism activities,” the notification said.

Among activities prohibited in the eco-sensitive zone are hydroelectric projects, brick kilns, commercial use of firewood and discharge of untreated effluents in natural water bodies or land areas.

Deepar Beel has long been used as a sponge for Guwahati’s sewage via a couple of streams. The wetlands have also suffered from seepage of toxins from a garbage dump at Boragaon adjoining it. “ About 150 species of birds have been recorded in the sanctuary, out of which two are critically endangered, one endangered, five vulnerable and four near-threatened,” the notification said.

“Elephants regularly visit the wetlands from adjoining Rani and Garhbhanda Reserve Forest and the wetlands are an integral part of the elephant habitat. Besides these, 12 species of reptiles, 50 species of fish, six species of amphibians along with 155 species of aquatic macro-biota have been recorded in the sanctuary,” it said.

But being adjacent to “fast-developing Guwahati”, the sanctuary is “facing immense biotic pressure by way of human settlements and even-increasing development activities”, the notification said.

“City waste as well as industrial effluents causing serious problem to the ecological and environmental values of the rich wetlands that create a threat to all life forms and ecosystems in the Deepar Beel,” it added, also noting the railway track along the wetlands’ southern boundary with concern.

Wildlife specialist Bibhab Talukdar said if the implementation of the rules is weak, it does not really matter if the eco-sensitive zone extends 10 km or 10 metres beyond a protected area.

No clarity on govt. formation in Kabul #GS2 #IR

There was no clarity on ‘any entity’ forming a government in Afghanistan, official spokesperson of the Ministry of External Affairs (MEA) Arindam Bagchi said here on Friday.

Addressing a press conference, he observed that India was waiting to see how inclusive would be the next government in Kabul. The situation on the ground was “uncertain”, he noted.

“Currently, there is no clarity on any entity forming a government in Kabul. There has been a lot of stories going around about who will be represented in the government and whether the government will be inclusive, which is another question, and whether other elements of the Afghan polity will be represented in that,” he stated. Explaining that India was aware of the dialogue currently under way on government formation in Kabul, he said that the issue of recognition of the Taliban amounted to “jumping the gun” in view of the “fluid situation”.

“We are monitoring the situation and are in touch with partner countries,” he stressed.

Airlift failure

Mr. Bagchi’s statement came a day after India failed to airlift at least 160 Hindu and Sikh Afghans because of the chaotic conditions in the Afghan capital, where the Taliban has declared that it will not allow any further evacuation of Afghan nationals.

Officials here said India had not “paused” evacuation and would carry out airlifts at the right moment. The evacuees were at a safe place in Kabul and not harmed by the blasts that took place at the airport.

India would continue to raise the issue of terrorism in the United Nations. It was “observing” the situation. Its current concern revolved around the safety and security of those in Afghanistan.

Explaining India’s visa policy towards Afghans seeking refuge, Mr. Bagchi pointed out that the “e-emergency” visa was now open for the Afghans who have been supportive of bilateral relationship between India and Afghanistan.

“They are currently coming here under the six-month visa regime and we will take it from here. It’s an evolving situation and making long-term plan is not the best of ideas, considering the last few days.

Indian astrophysicists spot rare merger of three jumbo black holes #GS3 #SnT

A rare merging of three supermassive black holes has been spotted by a team of astrophysicists from the Indian Institute of Astrophysics (IIA), working with Professor Francoise Combes from the Paris Observatory. This is only the third time such an event has been observed and the findings were published as a letter in the journal Astronomy and Astrophysics in June.

The team were observing the merging of two galaxies — NGC7733 and NGC7734 — in the earth’s celestial neighbourhood when they detected unusual emissions from the centre of the latter and a curious movement of a large bright clump within it, having a different velocity than that of NGC7733. Inferring that this was a separate galaxy, the scientists named it NGC7733N.

All three merging black holes were part of galaxies in the Toucan constellation. They are quite far away given that the earth’s nearest galactic neighbour — the Andromeda galaxy — is 2.5 million light years away. Yet the paper describes these as nearby galaxies.

“In astronomy everything is relative. When we study the solar system, we say Mercury is closer and Jupiter is far… Compared to our nearest neighbour Andromeda galaxy, the galaxies NGC7733, 7734 and 7733 N are quite far away, but compared to the size of universe, they are nearby galaxies,” explains Jyoti Yadav, a Ph.D. student at the IIA and the first author of the paper.

In an email to The Hindu , Mousumi Das, also from the IIA and another author of the paper along with Sudhanshu Barway, says the team were studying the active galactic nuclei in the two massive barred spiral galaxies NGC7733 and NGC7734 and that the detection of the third was surprising. “It was a bit like buy two and get one free,” says Dr. Das. “The PI of the project confirmed our suspicions using spectroscopic data from a European telescope called MUSE in Chile.”

The group observed these galaxies with a near infrared telescope in South Africa. “Then, later on, because they appeared interesting, we also observed them with the UVIT [onboard the first Indian space observatory ASTROSAT],” says Dr. Das. “We also found optical data in the MUSE archive. So, we did not have to do the optical spectroscopy.”

Final parsec

In a press release, the team explains that if two galaxies collide, their black holes will also come closer by transferring the kinetic energy to the surrounding gas. The distance between the black holes decreases with time until the separation is around one parsec (3.26 light-years).

The two black holes, however, are then unable to lose any further kinetic energy to get even closer and merge. This is known as the final parsec problem. But the presence of a third black hole can solve this problem.

“The two can come closer when another black hole or a star passes by and takes away some of their combined angular momentum,” explains Dr. Das. Thus, the dual merging black holes merge with each other in the presence of a third.

Many Active Galactic Nuclei (AGN), or supermassive black hole at the centre of a galaxy, pairs have been detected in the past, but triple AGN are extremely rare, and only a handful have been detected before using X-ray observations.

“Multiple accreting black holes [AGN] may be more common in our universe and especially common in galaxy groups. So the growth of black holes may be driven by such mergers in groups,” says Dr. Das.

The study used data from the Ultraviolet Imaging Telescope (UVIT) on board the first Indian space observatory ASTROSAT, the European integral field optical telescope called MUSE mounted on the Very Large Telescope (VLT) in Chile and infrared images from the optical telescope (IRSF) in South Africa.

Experts sound alert for festive season #GS3 #SnT

The coming festive season could be dangerous and lead to a surge in COVID-19 cases if people are not cautious, doctors and experts from across the country have warned. They said social gatherings could turn into superspreader events if communities failed to follow protocols.

The cautionary note comes close on the heels of Indian Council of Medical Research (ICMR) Director General Balram Bhargava’s recent advice that vaccination is a disease-modifying and not disease-preventing option. He advocated continued adherence to COVID-19 appropriate behaviour.

No room for laxity

Nitin Nagarkar, Director, All India Institute of Medical Sciences (AIIMS), Raipur, said people needed to remember that cases had gone down earlier this year only to shoot up in April, when the country saw a massive second wave.

“In February, the country was reporting around 8,000 cases, but as soon as individuals and communities became complacent, the cases surged alarmingly. People should remain cautious and follow COVID-19 appropriate behaviour, at all times. People should keep wearing a mask and avoid crowding even while celebrating festivities,” he noted.

Sarman Singh, Director, AIIMS, Bhopal, said that having to be careful did not mean that one should not celebrate festivals. “Technology has empowered us to remain emotionally and socially connected through the virtual medium,” he said.

“Vaccine provides over 95% protection against severe disease and hospitalisation, which means post-vaccination, most cases of COVID-19 would be mild or asymptomatic, but that in no way means we forget to follow COVID-19 appropriate rules,” said Saurabh Varshney, Director, AIIMS Deogarh. “We as a community have to work collectively to contain the spread of the infection while celebrating festivals.”

Personal safeguards

“If we want to go back to normal in the near future, we need to impose self-restrictions, and the most important is to avoid socialising during festivals. If we can limit our social gatherings for a few months till the time a large proportion of our population gets inoculated, we can create a deterrent against spread of infection to a large extent,

India adds 557 new species to faunal wealth #GS3 #Environment

India has added 557 new species to its fauna, which includes 407 new species and 150 new records, reveals Animal Discoveries 2020 , a document published recently by the Zoological Survey of India (ZSI). The number of faunal species in India has climbed to 1,02,718 species with the discovery of the new species.

Among the new species, some interesting species discovered in 2020 are Trimeresurus salazar , a new species of green pit viper discovered in Arunachal Pradesh; Lycodon deccanensis , the Deccan wolf snake discovered in Karnataka; and Sphaerotheca Bengaluru , a species of burrowing frog named after the city of Bengaluru.

The list also includes Xyrias anjaalai , a deep water species of snake eel from Kerala; Glyptothorax giudikyensis , a species of catfish from Manipur; and Clyster galateansis , a species of scarab beetle from the Great Nicobar Biosphere.

Among the new records, Myotis cf. frater , a bat species earlier known from China, Taiwan and Russia, has been reported for the first time in Uttarakhand in India; and Zoothera citrina gibsonhilli , an orange-headed thrush earlier known from southern Myanmar to south Thailand (central Malay peninsula), which was reported for the first time in India based on a collection made from the Narcondam island in the Andaman & Nicobar Islands.

Rich in diversity

Among the States, the highest number of new species were discovered from Karnataka (66 species), followed by Kerala (51 species). 46 new species were discovered from Rajasthan and 30 from West Bengal.

In terms of new records or species recorded in the country for the first time, Arunachal Pradesh had the highest (20 new records). In the Andaman & Nicobar Islands, 25 new species were discovered and 16 new records documented in 2020.

Commenting on the publication, Dhriti Banerjee, Director, Zoological Survey of India, said that the discovery and description of a species is a long-drawn process and can take years, from the collection of a specimen to identifying and matching the specimen with other records in repositories, and finally publishing the details in a journal.

Ministries reach a consensus on hydropower projects in Himalayas #GS3 #DM

Six months after a devastating flood of rock, ice and debris gushed down the Rishiganga river in Uttarakhand and killed at least 200 and severely damaged two hydropower projects, three Union Ministries, which initially had dissenting views on the future of hydroelectric power projects, have come to a consensus.

According to an affidavit filed in the Supreme Court this month, as part of an ongoing case on the feasibility of hydroelectric projects in the aftermath of the 2013 Uttarakhand floods, seven projects have been allowed to complete construction primarily on the grounds that they were over “50% complete.” They include the 512 MW Tapovan project that was severely damaged.

No other new projects would be allowed in the upper reaches of the Ganga and those sanctioned would have to abide by environment regulations that prescribe a minimum flow in the river at all times.

In 2016, the Union Water Ministry, then led by Uma Bharti, had contested the establishment of these projects and taken a position opposed to the Environment and Jal Shakti Ministries. However, in 2019, documents show, the Ministry had changed its views to accommodate seven projects.

The affidavit this month is the first formal document that reveals all three Ministries to be on the same page.

The seven projects are the Tehri Stage 2, Tapovan Vishnugadh, Vishnugadh Pipalkoti, Singoli Bhatwari, Phata Bhuyang, Madhyamaheshwar and Kaliganga 2.

Activists say the government’s pushing ahead with the projects revealed that the floods of February had failed to jolt the government into realising that hydropower development in the Himalayas was “illogical”.

“There were two projects, Singoli Bhatwari and Phata Bhuyang, which were specifically linked to the Kedarnath tragedy. Both have been allowed. The Vishnugadh project damaged in the February floods too has been allowed to progress even though 200 plus people died due to the criminal negligence of there not being a disaster warning system.

The affidavit has the government admitting that the floods have damaged the tunnels and topography of the projects. All of this has changed. These projects got their environmental clearance based on very different conditions. So how are they being allowed on the same environmental clearance? ” questioned Mallika Bhanot, a critic of hydropower development in the Himalayas.

Self-seeking individuals scuttling intentions of IBC: CEA #GS3 #Economy

Indicating that some stakeholders’ actions were scuttling the intended outcomes of the Insolvency and Bankruptcy Code (IBC), Chief Economic Adviser Krishnamurthy Subramanian invoked the concept of ‘Dharma’ on Friday to urge Indian industry to stop being ‘practical’ and strive to be ‘ideal’, instead.

The IBC regime, he said, had helped India emerge from a ‘feudalistic system’ where a corporate debtor felt it was his ‘divine right’ to retain control, and shifted the focus to a ‘Creditor in Control’ regime.

Citing India’s ancient literature, including the Bhagavad Gita, Mr. Subramanian said problems arise when there is a wedge between socially optimal behaviour and conduct that is individually optimal for an economic agent. “I think, in the case of IBC, you can clearly see that there are some actions that every stakeholder can take, which would be optimal for the entire IBC system as a whole; visibly what every entity is doing that is basically privately optimal for them. And this wedge is what’s actually leading to the preservation of this Nash equilibrium, where we are stuck where we are,” he said.

“When you think about the concept of Dharma from an economic angle, you start realising why it was such a powerful idea… (it means) there is a much bigger goal… “And in some sense, if you think from an economist’s perspective, Dharma is actually this concept of aspiring for what is socially optimal.

India-Australia aim for ‘early harvest’ trade pact by Dec. #GS3 #Economy

The trade ministers of India and Australia have agreed to speed up trade negotiations with an aim to reach an interim ‘early harvest’ pact by December for liberalising the bilateral flow of goods and services.

Commerce and Industry Minister Piyush Goyal met Australia’s Minister for Trade, Tourism and Investment Dan Tehan virtually on Thursday to discuss the road map for concluding a Comprehensive Economic Cooperation Agreement (CECA), beginning with the early harvest accord.

The meeting comes within three weeks of a visit to New Delhi by the Australian Prime Minister’s special envoy to India Tony Abbott. Australia views India as a long-standing, valued and trusted partner, Mr. Abbott had asserted in his meetings with Indian ministers, hinting at an expeditious approach on Canberra’s part to CECA negotiations.

Three rounds of talks have already been held between the chief trade negotiators of both sides, the ministers said in a joint statement.

‘Pathway to CECA’

“The Ministers noted the importance that negotiations take into account the views of business, industry and other stakeholders, and decided to start consultations on the potential opportunities and impacts of an interim agreement as a pathway to a full CECA,” they added.

“The Ministers look forward to a balanced trade agreement that encourages expanded trade and investment flows to the benefit of both of our economies and peoples.