1) Overview of the Indian Economy
Context:
- Before the Interim Budget, the Chief Economic Adviser (CEA) released a report on India’s economic insights instead of the usual Economic Survey.
- The decision was influenced by concerns about general elections and potential disruptions in the 2024 Budget process. The traditional Economic Survey is typically presented by the Finance Minister before the Union Budget on February 1 each year.
The Indian Economy Review 2024 is divided into two chapters:
Chapter 1: Indian Economy – Past, Present, and Future
- Offers a comprehensive overview of India’s economic journey since independence.
- Focuses on different time periods, from initial industrialization to recent global events like the pandemic.
- Highlights significant reforms and strategies contributing to India’s transformative growth.
Chapter 2: What Made the Indian Economy Resilient?
- Explores factors contributing to the resilience of the Indian economy, especially in the face of recent global challenges.
- Examines policy measures, reforms, and initiatives across sectors like finance, manufacturing, digital infrastructure, and public welfare.
Summary of Indian Economy Review 2024:
- Economic Growth Projections
- India’s economic journey in the past decade elevated it to the 5th largest global economy.
- Projected growth rate at 7% for FY24, likely continuing into FY25.
- Optimism echoed by global agencies like S&P Global Ratings.
- Historical Growth: 7.2% growth in FY23 and 8.7% in FY22. India became the world’s fourth-largest stock market in terms of market capitalization, overtaking Hong Kong.
- Potential as World’s Third-Largest Economy
- India poised to become the world’s third-largest economy by 2030, targeting a $7-trillion GDP.
- Supported by rapid development in public sector infrastructure, financial health, and initiatives like Jan Dhan Yojana.
- Fifty-one crore bank accounts under Jan Dhan Yojana with total deposits of over ₹1 lakh crore, with over 55% belonging to women.
- India is the third-largest fintech economy in the world after the USA and the UK.
- Challenges and Opportunities
- Acknowledges challenges such as geopolitical conflicts, supply chain disruptions, and global shifts.
- Effective management of COVID and a balanced approach towards energy transition demonstrate resilience.
- Global Risks: Geopolitical conflicts and supply chain disruptions.
- Technological Progress: AI and global manufacturing shifts.
- Energy Transition: Balancing economic growth and green energy initiatives.
- Vaccination Impact: Contributed to quick economic recovery.
- Oil Supply Management: Notable in maintaining economic stability.
- Future Outlook
Anticipates a bright future with rising aspirations, a healthier financial sector, and continuous GDP growth above 7%.
2. India is positioned at the 93rd rank among 180 countries in the Corruption Perceptions Index 2023.
Context:
Transparency International recently published the Corruption Perceptions Index (CPI) for 2023, evaluating countries based on perceived corruption in the public sector. India’s position changed slightly, ranking 93rd out of 180 countries with a corruption score of 39.
Key Points:
- Introduction: Transparency International introduced the CPI in 1995, publishing it annually to rank countries based on perceived corruption using expert assessments and surveys.
- India’s Rank: In 2023, India dropped to the 93rd position from 85th in 2022, with a corruption score of 39, a slight decrease from the previous year.
- Limited Change: The report highlights minor fluctuations in India’s score, making it challenging to draw definite conclusions. It mentions actions narrowing civic space, like the passage of a telecommunications bill.
- South Asia: Pakistan (133) and Sri Lanka (115) face challenges due to debt and political instability but maintain government accountability through strong judicial oversight. Bangladesh (149) struggles with press crackdowns despite economic growth.
- Regional Insights: China (76) has an aggressive anti-corruption campaign, but doubts exist about its long-term effectiveness. The Asia Pacific region shows little progress in curbing corruption in the 2023 CPI.
Top and Bottom Performers: Countries like New Zealand (3) and Singapore (5) excel with robust corruption control mechanisms, while struggling states include North Korea (172) and Myanmar (162), with Afghanistan (162) facing a humanitarian crisis.
3. Astronomers observe an unusual object descending into the 'Mass Gap' of a Black Hole.
Introduction
In astronomy, scientists sometimes find space things that make them wonder. A recent study in the journal Science shared a discovery that’s likely to make scientists excited and curious.
Neutron Stars: Really Dense
- Super Dense Objects: Neutron stars are some of the most compact things in space. They’re as small as an atomic nucleus but as big as a city, pushing our understanding of super-dense stuff to the max.
- A Heavy Matter: If a neutron star is heavy, it might collapse and become something even denser, like a black hole.
Puzzling the Boundary
- A Space Mystery: To understand what happens when neutron stars turn into black holes, scientists need to find objects in-between. These objects also need careful, long-term study.
- A New Find: In the NGC 1851 star cluster, there’s a cosmic system that doesn’t neatly fit into the categories of neutron stars or black holes.
NGC 1851E: Something New
- Seeing Something Different: Inside NGC 1851, there are two stars that give us new insights into extreme matter in space. This system has a millisecond pulsar, a fast-spinning neutron star that sends out radio light beams, and a massive, dark companion that can’t be seen with any light.
- The Pulsar’s Job: Millisecond pulsars are like space clocks. They spin steadily, and any changes in their spin can tell us important things about what’s around them.
Revealing the Weight of Secrets
- Very Exact Measurements: The MeerKAT radio telescope in South Africa closely watched the NGC 1851E system.
- What They Found: Observations helped figure out exactly how the two objects move and how heavy they are together. The system’s mass is nearly four times that of the Sun, and the invisible companion is denser than a regular star but not as heavy as a black hole.
- A Weird Mass Gap: The companion’s mass is in a range that’s puzzling to scientists, between the heaviest neutron stars and the lightest black holes. Understanding objects in this range is a big mystery in space science.
A Cosmic Dance: Stellar Partnerships
- An Interesting Idea: One exciting possibility is that a pulsar is circling around what’s left after two neutron stars collided. This is possible because there are many stars packed closely together in NGC 1851.
- Starry Dance Floor: In this group of stars, they twirl around each other, changing partners as they go. If two neutron stars get too close, they collide, creating a black hole. This black hole can then disturb the dance of other stars in the cluster.
- Still Lots of Questions: The work isn’t done. Research is ongoing to figure out exactly what the companion is. Is it the lightest black hole, the heaviest neutron star, or something completely different?
Exploring New Frontiers: When at the border between neutron stars and black holes, there’s a chance of discovering completely new types of space objects.
4. Report on the current status of Snow Leopards in India.
Context:
A recent report on snow leopards in India, released by the government and non-profit groups, reveals that only 34% of their habitat is legally protected. The report suggests the need for a dedicated Snow Leopard Cell at the Wildlife Institute of India for ongoing monitoring and conservation.
Key Points:
- Snow Leopards in India: India is home to snow leopards, covering a certain number of square kilometers.
- Legal Protection: Only one-third of their habitat is legally protected, putting the species at risk.
- Unprotected Areas: About 70% of the vital snow leopard habitat is not protected, showing the need for conservation efforts.
- Population Assessment: Using camera traps over four years, SPAI identified individual snow leopards.
- Hotspots: Ladakh has the most snow leopards, followed by Uttarakhand and Himachal Pradesh.
Challenges:
- Limited Legal Protection: Most of their habitat lacks legal safeguards, making them vulnerable.
- Undefined Range: The national range of snow leopards in India is unclear due to a lack of analysis.
- Population Estimate: A revised estimate is necessary to better understand the snow leopard population in India.
Examples:
- Ladakh, Uttarakhand, and Himachal Pradesh are noted as snow leopard hotspots.
- SPAI, with partners like the Wildlife Institute of India, conducted the assessment.
Action Steps:
- Establish Snow Leopard Cell for consistent monitoring and studies.
- Conduct periodic population estimations every fourth year.
- Increase legal protection for unprotected habitat.
- Conduct a revised assessment for accurate population determination.
Increase public awareness to support conservation efforts.
5. The central government intends to replace the Indian Stamp Act, 1899 with a new legislation; here's why.
Introduction
- Stamp duty is a tax you pay when registering different documents, and it’s important in India’s financial system.
- However, the current Indian Stamp Act from 1899 is facing issues with being outdated and inconsistently applied.
- To fix these problems, the Ministry of Finance has introduced the ‘Indian Stamp Bill, 2023’ to update and modernize how stamp duty works.
Understanding Stamp Duty
- Nature of Stamp Duty: Stamp duty is a tax the government charges for registering various documents, like agreements and transaction papers, with the registrar.
- Tax Calculation: The amount you pay is usually a fixed value based on the document’s nature or a percentage of the agreement’s stated value.
Scope of Stamp Duty
- Applicable Documents: Stamp duty applies to different documents, including bills of exchange, cheques, promissory notes, bills of lading, letters of credit, insurance policies, share transfers, debentures, proxies, and receipts.
- Jurisdiction: Although the Central government sets stamp duty rates, individual states collect the revenue within their territories, following Article 268 of the Constitution.
Indian Stamp Act, 1899
- Fiscal Legislation: The Indian Stamp Act, 1899, is a law about taxes in the form of stamps on documents that record transactions.
- Instrument Definition: According to Section 2 of the Act, an “instrument” includes any document creating, transferring, limiting, extending, extinguishing, or recording any right or liability.
- Stamp Characteristics: A “stamp” is any mark, seal, or endorsement authorized by the State Government for the Act’s duty purposes, whether adhesive or impressed.
- Taxable Instruments: Section 3 of the 1899 Act states that specific instruments or documents have charges listed in Schedule 1, including bills of exchange and promissory notes.
Reasons for the Indian Stamp Bill, 2023
- Redundancy and Inoperability: The Ministry of Finance points out issues of redundancy and inoperability in the Indian Stamp Act, 1899.
- Lack of Uniformity: The absence of rules for digital e-stamping and inconsistent stamp duty laws across Indian states calls for a new law.
Notable Provisions in the Draft Bill
- Digital E-stamping: The draft Bill introduces digital e-stamping, allowing electronic payment of stamp duty.
- Digital Signatures: It includes provisions for digital signatures, redefining “executed” and “execution” to mean “signed” and “signature,” incorporating electronic records and signatures as defined in the Information Technology Act, 2000.
- Penalty Enhancements: The draft Bill suggests higher penalties, increasing the maximum penalty from Rs 5,000 to Rs 25,000 for breaking the law and imposing a daily penalty of Rs 1,000 for repeated offenses.
Conclusion
The ‘Indian Stamp Bill, 2023’ is a significant step in modernizing stamp duty laws in India. By fixing the issues in the current law and introducing digital-friendly changes, the bill aims to make stamp duty processes smoother and improve compliance in the country’s financial system.
