Current Affairs – July 20, 2024

{GS1 – Geo – EG – Mineral Resources} Critical Minerals

Context (TH): India’s pursuit of critical minerals is gaining momentum but is facing challenges.

States with Reserve Discoveries

Lithium: Significant reserves found in Jammu & Kashmir (estimated at 5.9 million tonnes), marking India’s first significant lithium discovery, potentially reducing import dependency.
Graphite: Identified blocks in Jharkhand and Arunachal Pradesh, among other states.
Other Minerals: Various states, such as Odisha, Tamil Nadu, Uttar Pradesh, Chhattisgarh, Karnataka, Rajasthan, and Maharashtra, host blocks or reserves of critical minerals like phosphorite, rare earth elements, tungsten, vanadium, cobalt, and manganese.

Challenges

Data Availability: Insufficient geological data for some blocks hampers investor interest, impacting reserve estimation and profitability assessment.
Technology Readiness: Extraction technologies, particularly for minerals like lithium from clay, are not fully developed, posing challenges to commercial viability.
Investor Interest: Initial auction rounds received limited interest, with many blocks failing to attract sufficient bids, resulting in scrapped or delayed auctions.

Recent Government Initiatives

Legislative Changes: Amendments to the Mines and Minerals (Development and Regulation) Act, 1957 have enabled the government to auction mining rights for 24 critical and strategic minerals.
Overseas Acquisitions: India’s strategic approach includes acquiring overseas assets to secure critical minerals. For example, a Lithium brine mine was acquired in Argentina.
Partnerships: India has joined initiatives like the U.S.-led Mineral Security Partnership to strengthen mineral security through collaborations with major global players.

Read More > Why Private Mining is Allowed for These Critical Minerals ?

Way Forward

Investment in Technology: Allocate resources for developing advanced extraction and processing technologies like high-purity vein graphite needed for advanced technologies from Indian reserves.
Strengthen Regulatory Framework: To improve transparency and attractiveness for investors, facilitating smoother auctions and project investments.
- For example, establishing a specialised authority overseeing exploration, mining, and environmental regulations for strategic minerals.
Promote Research and Development: Encourage Indian Rare Earths Limited (IREL) to focus on more sustainable mining practices.
Public-Private Partnerships: To pool expertise and resources for efficient exploration, extraction, and processing of critical minerals.
- For example, The collaboration between the US Department of Energy and private firms like Lynas Corporation in developing rare earth mineral supply chains.

{GS1 – Geo – PG – Climatology} Rainfall Pattern in India

Context (IE): This season, the southwest monsoon is active over a large geographical area of India.

At least 80% of the country reported widespread rainfall lashing Assam, West Bengal, Uttar Pradesh, Uttarakhand, Gujarat, coastal Maharashtra and Karnataka, Kerala, and Lakshadweep.
The country’s rainfall stands at 97% of the normal for this season. Overall, 17 states have either received normal or above-normal rainfall this season.

Factors causing Heavy Rainfall

The continuous incoming of moisture-laden strong westerly winds from the Arabian Sea.
The monsoon trough (a semi-permanent, low-pressure area) extends between Pakistan and the Bay of Bengal during the monsoon season.
- It usually oscillates between north and south within the season.
- If it moves towards the south, it causes more rainfall in central, eastern, and peninsular India.
- If it moves towards the north, more rainfall occurs in the Himalayan foothills, but the rest of India experiences a drop in rainfall.
The persistence of an offshore trough (a shallow trough of low pressure, which develops along India’s coast during the monsoon) between south Gujarat and north Kerala.
The intermittent development of a wind shear zone – where winds move with different velocities and directions – along latitudes 20 ° N between central and peninsular India.
The development of a low-pressure system over the west-central Bay of Bengal, off the Odisha coast, which later moved over Chhattisgarh and southeast Madhya Pradesh.

More Info > Mechanism of Indian Monsoons.

{GS2 – IR – Middle East} Gulf region and India’s energy security

Context (IE): The Gulf region has been critical in ensuring India’s energy security.
Energy security is significant not only for industrial growth but also for power and transportation sectors that are critical for the functioning and growth of the economy.

Energy production and consumption in India: Statistics

India is the world’s third-largest energy consumer after China and the United States.
According to the Statistical Review of World Energy, 2024, India’s total primary energy consumption was 39.02 exajoules, comprising 6.3% of total global energy consumption in 2023.
India’s total primary energy production in 2022-23 was 19.55 exajoules, and total consumption during the same period was 35.16 exajoule (Energy Statistics India, 2024)
Only about 68% of the demands were met through domestic production.

Coal

Coal is India’s largest source of primary energy supply, comprising 58.12% of the total in 2023.
Despite significant domestic coal production at 16.75 exajoules in 2023, India has to source part of its coal demands externally, given the huge consumption at 21.98 exajoules in 2023.

Oil and gas

Oil and gas is the 2nd largest source of primary energy supply in India at 35.44% in 2023 (NITI Aayog).
India’s total oil consumption was 5.44 million barrels per day in 2023, while total oil production was 0.73 million barrels per day (Statistical Review of World Energy, 2024).
Similarly, natural gas consumption was 62.6 billion cubic metres, while natural gas production was only 31.6 billion cubic metres.
This meant that most oil and gas are sourced externally, underlining India’s dependence on imports for its energy security, especially in meeting the oil and gas demands.

Importance of Gulf countries in India’s energy security

Historically, the Persian Gulf states, namely the six Gulf Cooperation Council (GCC) countries and Iran and Iraq, have been India’s primary oil and gas suppliers, contributing nearly 55-60% of total O&G imports.
The Gulf countries have been among India’s top petroleum suppliers since the 1980s and have remained the most dependable suppliers despite the fluctuations in the international market and supply chains.
In recent years, with concerns about carbon emissions and volatility in the international oil and gas market, India has deliberately tried diversifying its energy consumption sources and petroleum imports, with Russia, the United States, Australia, and Nigeria emerging as important sources.
However, the Gulf region has remained critical to India’s energy security due to its geographical proximity to India and the established buyer-seller networks.
Capacity and commitment of the Gulf states, such as Saudi Arabia, the UAE and Qatar, to supply oil and gas at special prices work in their favour. This is important given the volatility in the international market.

Economic relations between India and the Gulf region

For the Gulf suppliers, India has been a stable and large market for crude oil and natural gas as it is one of the biggest global consumers.
This has made India an attractive destination for Gulf investments in the energy sector, with mega Gulf energy corporations such as Saudi Aramco and Emirati ADNOC committing big long-term investments.
In 2023-24, of the total US$1.11 trillion foreign trade, US$208.48 billion came from the Gulf and West Asia region, comprising 18.17% of India’s foreign trade.
According to the DPIIT, total FDI from the GCC countries into India between 2000-2024 was US$24.09 billion with UAE (7^th), Saudi Arabia (19^th) and Qatar (24^th) being among the top 25 sources of FDI.
Indian investments and participation in the GCC market have witnessed a sharp rise, with
Indian companies such as Larsen & Toubro, Shapoorji-Pallonji and Tata, while Indian businesses, such as the Lulu hypermarket chain, made their mark in the GCC market.

Indian diaspora in the Gulf region

As per official estimates, nearly 8.5-9 million Indians live and work in the six GCC countries and comprise the region’s largest expatriate community.
The diaspora has been instrumental in making India the largest remittance recipient country in the world, contributing nearly 40-50% of the total remittances received by India over the years.
- In 2023, India received US$125 billion in remittances.

Bilateral ties

The strengthening of bilateral political and strategic ties, especially since the early 2000s, has played a crucial role in making the Gulf a dependable partner.
The bilateral ties, especially with UAE, Saudi Arabia, and Qatar, have helped India overcome challenges due to sanctions on major global oil and gas suppliers such as Iran & Venezuela, the impact of regional conflicts during and after the Arab Spring (2010-12), and the global COVID-19 pandemic.

Context (IE): Bombay HC quashed the Maharashtra government’s notification exempting private schools – located within 1 km radius of a government or government-aided school – from providing a 25% quota for students belonging to “weaker section and disadvantaged group in the neighbourhood”.

With the notification, Maharashtra joined Karnataka and Kerala as states that have imposed this new regime to exempt private schools from providing RTE admissions.
The quota comes under Section 12(1)(C) of The Right Of Children To Free And Compulsory Education Act, 2009 (RTE Act).

About Section 12 (1) (c) of RTE Act

Section 12 (1) (c) of the RTE Act, 2009 fixes the responsibility of private unaided schools to provide free and compulsory education to children from weaker and disadvantaged sections by admitting at least one-fourth of the total strength (25%) of class I or pre-school education.
Section 12 (2) of the RTE Act, state governments are bound to reimburse expenses incurred by the school per child or the fee amount, whichever is less.

Challenges in the implementation of Sec 12 (1) (c) of RTE Act

The RTE Act is implemented at the state level. Hence, the requirements for admission under Section 12(1)(c) differ from state to state.
According to the 2021 National Commission for Protection of Child Rights (NCPCR) report, the provision has only been implemented in 16 states and UTs nationwide.
The definitions of categories of income limits, fees, and age limits are not clear.
The States do not disburse the amount received from the Centre to the private unaided schools on time, harming the admission process.

{GS2 – Vulnerable Sections – Children} India Child Protection Report

Context (TH): India Child Protection (ICP) releases ‘Towards Justice: Ending Child Marriage’ report.

ICP is a child rights protection organisation addressing child abuse, trafficking, digital exploitation, and child marriage as part of the Child Rights and Multi-Faith Initiative (CMFI).

Key Findings

Assam’s legal measures-based model reduced child marriages by 81% from 2021-22 to 2023-24.
Every minute, three girls are married (185/hour, Census 2011), yet only three cases are reported daily.
14,137 child marriages were prevented In 2023-24 through legal actions and panchayat support.
At the current 92% pendency rate, India may need 19 years to clear child marriage case backlogs.

{GS3 – IE – Taxes} Taxation and Black Money

Context (YT): A dive into the taxation system in India and how it impacts the black money market.

Black Money

Also known as illicit wealth, it refers to money or assets that are not declared or reported to the government or other authorities for taxation or regulation.
This may include income from illegal activities such as drug trafficking or money laundering.
It contributes to income inequality, distorts financial markets, and undermines the rule of law.

Estimated black money in India

India ranks eighth globally in generating illicit funds (Global Financial Integrity Report).
According to the Bank of Italy’s calculation, India’s global tax haven holdings amount to $152-181 Bn, which equals approximately Rs. 10 lakh crore.
A former director of the CBI estimated that the total amount of illicit funds in India is approx. $500 Bn.

White money

It is obtained through legal and legitimate means and declared for tax purposes.
This includes income from employment, business, investments, or other sources that have been reported to tax authorities and are subject to taxation.

Economic Impacts of Heavy Taxation

Reduced Disposable Income and Spending: Greece’s economic crisis saw decreased household spending, which highly impacted businesses that rely on consumer demand.
Disincentive to Work and Invest: France’s high payroll taxes discourage hiring new employees, causing unemployment and slow economic growth.
Increased Complexity and Administrative Burden: The US tax code is notoriously complex, leading to errors and higher costs for taxpayers.
Encouragement of Tax Evasion: Italy’s high taxes foster a significant black market economy.
Reduced Competitiveness of Businesses: Companies relocate to low-tax countries like Ireland or Singapore, reducing tax base and impacting job creation and tax revenues.

Interplay of high taxation and Black money

Incentivize Underreporting: High taxes may lead individuals to underreport income, especially in cash-based businesses, fostering the circulation of black money.
Fuel Corruption: Large gaps between income and taxes owed can prompt bribery of tax officials, creating a black market for manipulating tax assessments and increasing black money flow.
Encourage Cash Transactions: High taxes push towards cash-only transactions to avoid scrutiny, complicating income tracking and enabling black money operations.
Discourage Formalization: Tax burdens can deter formal business registration, promoting informal sector activities where black money transactions thrive.
Reduce Transparency: Complex tax systems can be seen as opaque, fostering distrust and reducing compliance, potentially driving individuals towards black money activities.

Dabba trading (Bucketing)

It is an illegal practice in financial markets (a sort of gambling) that involves off-exchange trades conducted through unregistered intermediaries, avoiding regulatory oversight and tax reporting.
These transactions are fictitious and not executed on recognised stock exchanges, aimed at evading taxes and regulatory scrutiny.
Dabba trading exposes investors to significant risks, such as financial fraud and capital loss due to a lack of legal protections.
Authorities like SEBI (Securities and Exchange Board of India) enforce stringent measures to curb dabba trading, safeguard market integrity and protect investors from illicit activities.

Taxation System in India

India’s taxation system is a complex web of direct and indirect taxes levied by the central government, state governments, and local authorities.
The direct tax system includes personal income tax, corporate tax and capital gains tax. In contrast, the indirect tax system comprises the Goods and Services Tax (GST), excise and customs duties.

Read more > Taxation.

Examples

Vodafone-Hutchison tax case: A multinational company avoided taxes in India using shell companies in tax havens, exposing loopholes in generating and stashing black money abroad.
Hasan Ali Khan case: Accused of illegal wealth accumulation abroad, illustrating challenges for Indian authorities in repatriating black money.
Panama and Paradise Papers leaks: Exposed offshore networks used by Indians to conceal assets and evade taxes, revealing extensive overseas black money holdings.
Nirav Modi Case (2018): Involved a jeweller in a ₹13,500 crore loan fraud, revealing shell companies and complex transactions to move black money abroad.
ITAT Case (2021): A Bollywood actress received ₹ five crore in cash but declared only a fraction, highlighting challenges in taxing cash transactions and tackling black money in the entertainment industry.

Reaganomics

It is also known as supply-side economics or trickle-down economics. It advocates for lower taxes, reduced government regulation & decreased government spending to stimulate economic growth.
Developed in the 1970s by economist Arthur Laffer, it posits that lower tax rates can increase tax revenues by fostering economic expansion.
It is named after President Ronald Reagan, who implemented tax cuts & deregulation in the 1980s.
Proponents argue that these measures incentivise investment, job creation & higher wages.
Critics contend Reaganomics exacerbates income inequality, contributes to environmental degradation, and reduces public services and safety nets.

Government initiatives to tackle black money

Black Money (Undisclosed Foreign Income and Assets) Act, 2015: This act allows individuals to declare undisclosed foreign income/assets with penalties, bringing hidden wealth into the system.
Benami Transactions (Prohibition) Amendment Act, 2016: Strengthens laws against holding property in others’ names (benami) to hide wealth.
Fugitive Economic Offenders Act, 2018: It facilitates the confiscation of assets of economic offenders who flee to evade prosecution.
Prevention of Money Laundering Act (PMLA).
Demonetization of High-Value Currency Notes, 2016: Aimed to eliminate black money by invalidating high-denomination currency notes.
Digital Transactions: Incentivizes cashless payments to reduce reliance on untraceable cash. E.g., UPI.

Challenges in Tackling Black Money

Cash-Based Economy: Many transactions in India, especially in rural areas and small businesses, are cash-based, making it difficult to track income and detect tax evasion.
Weak Tax Administration: Inadequate resources and manpower in tax departments hinder effective audits and investigations, allowing black money activities to go unchecked.
Cross-Border Transactions and Tax Havens: Black money can be moved to countries with lenient tax laws or secrecy provisions, complicating efforts to trace and recover funds.
Corruption: Corruption within government agencies can facilitate bribery to overlook black money, undermining efforts to combat tax evasion.
Public Perception and Lack of Trust: Mistrust in the tax system due to inefficiencies or perceived unfairness discourages compliance and encourages black money generation.
Complexity of Tax Laws and Loopholes: Complicated tax codes with numerous exemptions and deductions provide manipulation and tax evasion opportunities.

Way Forward

Simplification of Tax Laws: Simplifying the tax system, reducing exemptions, and lowering rates can make it easier for people to comply and discourage tax evasion.
Encouraging Digital Transactions: Incentivizing digital payments through tax breaks as cash transactions are complex to track and make it easier to hide income.
Tax Deduction at Source (TDS): By collecting tax at the source of income, the government can ensure a portion of the tax is collected upfront, reducing opportunities for hiding income.
Presumptive Taxation: Simplifying tax filing for small businesses by estimating their income reduces the burden of complex record-keeping and discourages underreporting.

{GS3 – S&T – AI} Project Strawberry *

Context (IE): OpenAI’s Q* Project, now codenamed Strawberry, aims to develop self-training AI with human-like advanced reasoning and planning for deep research.

Features	Current Large Language Models	Strawberry
Common Sense Problems	Struggle with common sense issues.	Improved.
Multi-step Logic Tasks	Struggle with multi-step logic requires external frameworks.	Capable of autonomous complex problem-solving.
Planning and Reasoning	Ineffective without external frameworks and limited to immediate tasks.	Reasoning is like a human brain, capable of long-term planning and execution.
Scientific Research	Limited Contributions	Potential for scientific discoveries.
Time to Answer	Instant but superficial responses.	Takes time, even days, to provide well-thought-out answers.

Applications

Facilitate experiments, data analysis & solve complex mathematical & theoretical problems.
Provide personalised tutoring, create educational content and analyse market trends.

{GS3 – S&T – Space} NASA abandons VIPER Mission

Context (IE): NASA abandons the VIPER mission meant to look for water on the Moon’s South Pole.
However, Astrobotic will still attempt to land its Griffin spacecraft on the Moon in 2025, but the VIPER rover won’t be on board.

VIPER (Volatiles Investigating Polar Exploration Rover) aims to search for water on the Moon’s South Pole and provide additional insights about the site’s origin and water distribution.
It was NASA’s first mobile robotic mission to the Moon and part of the Lunar Discovery and Exploration Program.
It was the brainchild of NASA’s Commercial Lunar Payload Services (CLPS) initiative, which allowed the space agency to partner with American companies to deliver large and sophisticated science and technology payloads to the Moon.
The Viper rover was supposed to launch in late 2023 aboard a lander provided by Astrobotic Technology, but extra testing and increased costs kept delaying the mission.
The findings would have informed future landing sites under Artemis by helping to determine locations where water and other  resources can be harvested to support a long-term presence on the Moon.

{Prelims – Awards} Distinguished Service Awards

Context (PIB): The President of India presented Distinguished Service Awards.

About Ati Vishisht Seva Medal (AVSM)

It was originally instituted as the “Vishisht Seva Medal, Class II” in 1960 & was renamed AVSM in 1967.
Eligibility: Awarded for distinguished service of an exceptional order to all ranks of the armed forces.
Eligible persons:
- All ranks of the Army, Navy and Air Force, including Territorial Army Units, & other lawfully constituted Armed Forces.
- Nursing officers and other members of the Nursing Services in the Armed Forces.
- It can also be granted posthumously.
It is a peacetime equivalent of the Uttam Yuddh Seva Medal.

About Uttam Yudh Seva Medal (UYSM)

Instituted in 1980.
Eligibility: Awarded for distinguished service of an exceptional order during war/ conflict/ hostilities.
Eligible persons: Same as AVSM. It can also be granted posthumously.

About Param Vishisht Seva Medal (PVSM)

Instituted in 1960 as VSM Class-I, it was renamed as PVSM in 1967.
Eligibility: Awarded for distinguished service of the most exceptional order.
Eligible persons: Same as AVSM.

{Prelims – Bio – Diseases} Chandipura Virus (CHPV) Infection *

Context (IE): Six children have died of Chandipura virus (CHPV) infection in Gujarat.

It is a virus of the Rhabdoviridae family, which includes the lyssavirus that causes rabies.
Vectors: Sandflies (Phlebotomine sandflies and Phlebotomus papatasi) and mosquitoes (Aedes aegypti).
Transmission: Transmitted by sandflies or mosquitoes. The virus resides in the salivary gland of vectors and is transmitted to humans and other vertebrates, like domestic animals, via sandfly bites.
Contagion: No direct person-to-person spread. Infected patients should avoid exposure to vectors.
Rapid progression: High fever in the morning can lead to kidney or liver damage by the evening.

Symptoms: Rapid health deterioration in 24-48 hours, high-grade fever (>102°F) in first 24 hours, body ache, headache, seizures, respiratory distress, bleeding tendencies, anaemia and encephalitis.
The infection then reaches the central nervous system, leading to encephalitis (brain inflammation).
Susceptibility: Largely remained limited to children below 15 years. High fatality rate (50-60%).
Diagnosis: Using RT-PCR (Reverse Transcription-Polymerase Chain Reaction) Test.
Treatment: There is no specific antiretroviral therapy or vaccine. Treatment is symptomatic; severe cases may require ventilator support.
The infection is endemic to the central part of India (the population of vectors is higher).

{Prelims – In News} Warkari Sect

Context (IE): The Maharashtra government announced a pension scheme for Warkaris, who take part in the annual pilgrimage procession to Lord Vitthal temple in Pandharpur.

About Warkari Sect

The Warkari sect has been a part of Hindu culture in Maharashtra since it emerged as a ‘Panth’ during the Bhakti Movement in the 13^th century CE.
The term ‘warkari’ is a combination of two words: “war” (short for “wari”) meaning “pilgrimage,” and “kari” meaning person who performs the pilgrimage.
It is a non-Brahmanical tradition that worships Lord Vitthal or Vithoba (deity of Pandharpur), which is seen as a form of Vishnu or Krishna.
They chant the name of the Lord (nam japa), sing abhangs (holy song), and read haripath (sacred text), along the journey.
They conduct their annual pilgrimage known as ‘wari’ on the auspicious occasion of Ashadi Ekadashi.
Tukaram, Namdev, Chokhamela, Eknath, and Dnyaneshwar are among the saints and gurus of the bhakti movement associated with the Warkaris, and they are all given the dignified title of ‘Sant.’
Warkaris are strict Vegetarians. They wear a mala, or rosary, around his neck made of Tulasi beads.
Warkaris typically travel in groups, regardless of caste and creed. They practice Brahmacharya throughout student life.

{Prelims – PIN World – Africa} Dar es Salaam *

Context (DTE): Dar es Salam’s residents face severe water shortages due to ageing infrastructure, rapid urbanisation, and inadequate government response.
Dar es Salaam, Tanzania’s largest city, is located in a bay along the Indian Ocean and has become a crucial economic centre for the entire East African region.

{Prelims – PIN World – Europe} E.coli infestation in Seine River

Context (IE): Paris’ outdated sewage system severely infested the Seine River with E. coli.

Seine River

Location: Paris, empties into the English Channel at Le Havre.
Length: 775 kilometres, France’s second-longest river after the Loire.
Source: Rises 446 meters above sea level near Dijon in Burgundy.
Course: Flows through Paris for about 13 kilometres from west to east, joined by the Marne River.
Drainage Basin: Covers approximately 79,000 square kilometres, draining northern France.
Geology: The river basin comprises permeable rocks, which help reduce flood risk.
Precipitation: Receives modest annual rainfall (650 to 750 millimeters).

Source: National Geographic

Escherichia Coli (E. coli)

Aspect	Details
What is E. coli?	It is a rod-shaped bacterium found in the intestines of humans and most mammals.
Harmful Strains	Certain strains produce a toxin (Shiga), which can damage the intestinal lining.
Symptoms	Tiredness, severe abdominal cramps, diarrhoea, urinary tract infections, nausea, vomiting, and, in severe cases, gastrointestinal perforation, high fever, bloody diarrhoea, and kidney failure.
Transmission	Via contaminated food & water tainted by faecal waste from humans & animals.