2 Jan 2024

#GS3: – 01. World Economy and Geopolitics

Sixteenth Finance Commission (SFC) is expected to address sustainability of debt at the Central and state levels. The Centre maintains it is on track to achieve its target of fiscal deficit below 4.5% of GDP by FY26, and that general government debt will decline in the medium to long term. The SFC is expected to look into this as well as revenue trends and expenditure obligations at the Central and state levels to make recommendations. Another key area that the panel is expected to look into is expenditure reforms at the state level.
– Commentary in News
Key Terms/Issues : 16th and 15th Finance Commission

#GS3 — 02. War & Oil

A surprise surge in American oil and gas production and exports is helping to keep the world stocked, blunting the impact of widening conflict in the Middle East that has crimped key shipping lanes. When Iranian-backed Houthi militants began launching missiles and drones at ships crossing the Red Sea near Yemen in October, many feared disruption to the vital shipping lane would drive up energy prices. But oil and gas prices this past month have sunk about 5% and23%, respectively. That is largely because of record production of U.S. fossil fuels.

#GS4: – 03. Neutrality, Anonymity & Criticism

Once you decide a case you kind of distance yourself from the outcome. Outcomes are never personal to us as a judge. I never have any regrets. Yes, I have been in a majority in many cases and minority in many cases.But the important part of the life of a judge is never to associate yourself with a cause. Having decided a case,I leave it at that. So far as we are concerned we decide according to the constitution and the law. I don’t think it will be appropriate for me either to respond to the criticism or mount a defence to my judgement. What we have said in my judgement is reflected in the reason present in the signed judgement and I must leave it at that.
-CJI DY Chandrachud

#GS2: – 04. India-Tanzania Relations

India is planning to deepen its defence cooperation with Tanzania to enhance its strategic presence in the western part of the Indian Ocean.
Besides boosting maritime cooperation, New Delhi is looking at defence equipment sales, particularly in armoured vehicles.The initiatives align with India’s broader strategy to augment its presence in the western Indian Ocean,a region vital for its maritime trade routes. India’s concerted efforts to engage with nations in this region, such as Tanzania and Kenya, underscore shared security concerns like piracy and illegal fishing. The maritime collaboration with Tanzania,including joint surveillance exercises and hydrographic surveys, reflects India’s broader geopolitical strategy.The two sides held their joint exclusive economic zone surveillance exercise in July 2023.
– Commentary in News

#GS3: – 05. AI & Banking

We are seeing several banks and non-banks experimenting with AI. Global experience, so far, however, suggests that such deployment is mostly limited to back-office work and optimization of business processes to deliver efficiency gains.
– RBI Deputy Governor M Rajeshwar Rao

#GS2–#Essay: – 06. Inequality

True equity starts with ensuring that everyone has access to the most basic of needs. In nominal terms, India’sGDP is also the world’s fifth largest (by purchasing power parity, or PPP, it is the third largest). According to the International Monetary Fund(IMF), India will move into fourth place in 2025 and reach the third spot in 2027, with a projected economy of $5.4 trillion. Some might see this parallel between GDP and stock markets as
further vindication of the IMF’s “star performer” tag. Indeed, we have seen a reiteration of faith in the Indian economy by domestic and overseas investors, both of whom have been pouring money in to our capital markets. On a per-capita income basis, India ranks 139th by GDP(nominal) and 127th by GDP(PPP).And even as the proportion of Indians living below the poverty line has fallen dramatically, India is still hom eto an unconscionably large— perhaps the largest globally—number of people who barely meet their subsistence needs. In terms of social development indicators,access to health,education, sanitation, potable water, infant andf emalemortality, law and order, etc, we rank below many of our peers among emerging markets.While social indicators in some parts of the country are comparable to those in advanced countries,across large swathes of our landmass,they are worse than in sub-Saharan Africa. Widening disparities in income and wealth are never good news in an electoral democracy. Especially not when general elections are less than six months away. Both the government and central bank (to a lesser extent) have their task cut out for them.They must ensure that faster growth is also more equitble. Our strong macro data hides a disqueiting micro story that must be addressed in 2024.