Paper 4-GS-III, Topic: Environmental pollution and degradation

Ken-Betwa link hits green hurdle

Briefing:

  • India’s apex forest advisory body has imposed tough conditions on the Ken-Betwa river interlinking project.
  • Given the ecological and environmental impact posed by the project, it had to pass multiple authorities for clearance.
  • Forest advisory clearance was seen to be the last step.
  • In the case of the Ken-Betwa project, the FAC has refrained from explicitly giving its opinion either way and only seconded an earlier sub-committee’s report that had cleared the project subject to strict warning.
  • The ₹18,000 crore river interlinking project requires 4,141 hectares of forest in the heart of the Panna Tiger reserve.
  • Some more land is also needed to build a dam and a 230-km canal to transfer water to several drought-afflicted villages in Bundelkhand.
  • As compensation the Water department had agreed to acquire about 8,000 hectares of forest land from the Madhya Pradesh government and revive them as forest.
  • But the FAC said this land was not good enough as it was fragmented, and, to meaningfully revive a forest that is part of tiger habitat, the land acquired ought to be contiguous.
  • Revenue lands/non-forest lands by way of purchase or otherwise by the project proponents and the government.

Why these recommendation can’t be made:

  • Transferring private or revenue land is harder, time-consuming and costly.
  • Water department says that these measures are impossible to comply with.
  • Though department was already preparing a rebuttal to “contest” the FAC’s recommendations.

Source: The Hindu

Paper 3-GS-II, Topic: India and its neighborhood- relations

Civil nuclear cooperation

About the visit:

  • The Bangladesh Prime Minister,Sheikh Hasina arrives on four-day visit.
  • During Hasina’s visit, the two sides will be signing at least 25 pacts in various key sectors, including civil nuclear cooperation and defense.
  • Any agreement on the Teesta water sharing issue is unlikely to be inked.
  • Modi and Hasina will hold talks on Saturday, where India is set to announce a line of credit of $500 million to Bangladesh for military supplies.
  • Hasina will visit Ajmer on Sunday and meet Indian business leaders the next day.
  • The two side will ink of a framework agreement on civil nuclear energy which will provide for extensive cooperation in the sector, including setting up of nuclear reactors in Bangladesh by India.
  • In a bid to strengthen trade, the two sides are likely to announce setting up of another set of trade facilitation huts along the borders in the Northeast.

Source: Indian Express

Paper 4-GS-III, Topic: – Indian Economy and issues relating to development

RBI proposes wholesale banks

You should know:

  • The Reserve Bank of India (RBI) has proposed setting up wholesale and long-term finance (WLTF) banks.
  • WLTF are made to finance industrial and infrastructure projects with higher capital and non-reliance on savings deposits.
  • These banks are expected to be very large institutions ab initio to take on large exposure to industrial, commercial and infrastructure sector.
  • They are expected to carry substantial credit-concentration and devise sophisticated financial products.
  • The RBI has proposed a higher level of initial minimum paid-up equity capital, say Rs 1,000 crore or more, for these banks.
  • For universal banks, it is fixed at Rs 500 crore and of payments banks (PBs) and small finance banks (SFBs) it is Rs 100 crore.
  • RBIhave to heavily invest in information technology and skill building to mitigate the risks.

Working of WLTF:

  • WLTF banks are not expected to have significant retail exposure.
  • With regard to the sources of funding, WLTF banks are not expected to accept savings deposits.
  • Current account and term deposits may be mobilized by these banks. A higher threshold for term deposits, say above Rs 10 crore, might be considered.
  • There could be reasonable restrictions on premature withdrawal of these deposits
  • Another major source of funds for WLTF banks will be issuance of bonds. These could be issued locally or abroad in rupee-denomination.
  • Other funding sources such as commercial bank borrowing, certificate of deposits, securitization of assets etc. should be available for WLTF banks.
  • Primary sources of funds for WLTF banks could be a combination of term deposits, debt / equity capital raised from primary market issues or private placement, and term borrowings from banks and other financial institutions.
  • Whom WLTF lends to?
  • WLTF banks will focus primarily on lending to infrastructure sector and small, medium and corporate businesses.
  • Will mobilize liquidity for banks and financial institutions directly originating priority sector assets, through securitization of such assets and actively dealing in them as market makers.
  • What is need of WLTF?
  • The 12th 5 Year Plan had projected the infrastructure financing requirement at $ 1 trillion during the plan period and the funding gap is estimated to be above Rs 500,000 crore.
  • The banks’ current processes and business models may not yet be adequately prepared to make, monitor and manage long-term project loans so WLTF came into picture.

Source: Indian Express