1. Climate Change and Trade
Backdrop: COP29 Discussions
- Countries like China and India opposed climate-related trade measures, such as the EU’s Carbon Border Adjustment Mechanism (CBAM).
- Concerns:
- Risk of increased protectionism.
- Disruption of global supply chains.
Key Issues: Climate-Related Trade Curbs
- CBAM:
- Imposed by the EU last year.
- Applies a tariff on carbon emissions from imports.
- Aims to ensure imported goods meet EU climate standards.
- Criticized for impacting developing countries, which rely heavily on exports.
Objections from Developing Nations
- Nations like India, China, Brazil:
- Argue CBAM creates trade barriers.
- Viewed as unfair and protectionist.
- Contradicts the Paris Agreement’s provisions for equitable climate action.
Challenges of CBAM
- Developing nations point out:
- Lack of differentiation between developed and developing countries in CBAM.
- Export competitiveness threatened due to higher costs.
- May disincentivize industrial growth and innovation.
Trade and Climate Nexus
- Climate objectives are increasingly being tied to trade policies.
- Risks:
- Protectionist tendencies.
- Supply chain disruptions, especially in fossil fuel-based economies.
Accelerating Protectionism
- COVID-19 pandemic revealed vulnerabilities in global supply chains.
- Resulted in nations seeking to secure domestic production capacities.
Impact on Developing Countries
- Developing nations face dual challenges:
- Adopting climate standards.
- Maintaining competitiveness in global trade.
Climate Diplomacy Challenges
- Paris Agreement emphasizes “common but differentiated responsibilities.”
Measures like CBAM contradict this principle, creating disparities.
2. Sky is the limit for development of tribes: President Droupadi Murmu
Backdrop: COP29 Discussions
- Countries like China and India opposed climate-related trade measures, such as the EU’s Carbon Border Adjustment Mechanism (CBAM).
- Concerns:
- Risk of increased protectionism.
- Disruption of global supply chains.
Key Issues: Climate-Related Trade Curbs
- CBAM:
- Imposed by the EU last year.
- Applies a tariff on carbon emissions from imports.
- Aims to ensure imported goods meet EU climate standards.
- Criticized for impacting developing countries, which rely heavily on exports.
Objections from Developing Nations
- Nations like India, China, Brazil:
- Argue CBAM creates trade barriers.
- Viewed as unfair and protectionist.
- Contradicts the Paris Agreement’s provisions for equitable climate action.
Challenges of CBAM
- Developing nations point out:
- Lack of differentiation between developed and developing countries in CBAM.
- Export competitiveness threatened due to higher costs.
- May disincentivize industrial growth and innovation.
Trade and Climate Nexus
- Climate objectives are increasingly being tied to trade policies.
- Risks:
- Protectionist tendencies.
- Supply chain disruptions, especially in fossil fuel-based economies.
Accelerating Protectionism
- COVID-19 pandemic revealed vulnerabilities in global supply chains.
- Resulted in nations seeking to secure domestic production capacities.
Impact on Developing Countries
- Developing nations face dual challenges:
- Adopting climate standards.
- Maintaining competitiveness in global trade.
Climate Diplomacy Challenges
- Paris Agreement emphasizes “common but differentiated responsibilities.”
Measures like CBAM contradict this principle, creating disparities.
3. No Dual Eco-Clearance for 39 Categories of Industry
Key Points:
- Government Exemption:
- The Union Environment Ministry has exempted 39 categories of industries from the mandatory requirement of dual clearance—Environmental Clearance (EC) and Consent to Establish (CTE)—from State Pollution Control Boards (SPCBs).
- This decision reduces the compliance burden for industries that fall into the “white category,” which includes sectors deemed least polluting by the Central Pollution Control Board (CPCB).
- Industries Benefited:
- Industries include manufacturing units of solar cells and modules, wind and hydel power units, fly ash bricks, block manufacturing, air-coolers, air-conditioners, and repairing services.
- These industries no longer need SPCB’s permission to operate once they obtain EC.
- White Category Industries:
- Classified as the least polluting industries in a 2016 CPCB notification.
- Industries in this category already have environmental clearance and will not be required to seek CTE or Consent to Operate (CTO).
- This reduces duplication of approvals and is aimed at easing industrial operations without compromising environmental standards.
- Historical Context:
- The policy traces back to the creation of the CPCB in September 1974, tasked with preventing water pollution from industrial sources.
- The Water (Prevention and Control of Pollution) Act, 1974, established SPCBs to prevent the contamination of public water resources.
- Regulatory Reforms:
- Reforms have reduced the scope of SPCB control in certain cases, allowing industries to function without the delay of multiple permissions.
- Amendments to the Water Act made in Parliament earlier this year provide more ease of business while still maintaining oversight on pollution control.
- Environmental Minister’s Statement:
- Bhupender Yadav, the Environment Minister, emphasized that outdated rules caused a “trust deficit” and led to harassment for businesses, especially when violations were minor or did not cause harm to humans or the environment.
The new approach aligns with the government’s objective of “ease of living” and “ease of doing business”.
4. India’s Market Correction, China’s Sub-par Stimulus Salvo
- India’s Market Correction:
- The Nifty50 index has witnessed a correction phase, shedding a tenth of its value since its late September peak.
- A market is said to be in a correction when there is a decline of 10% or more from its recent high, with a decline of over 20% signaling a “bear market.”
- The correction has been linked to the build-up of Chinese government stimulus to boost its sluggish economy.
- China’s Economic Stimulus:
- In response to its economic slowdown, China announced its first stimulus package in late September.
- China’s central bank, People’s Bank of China (PBoC), injected liquidity into the economy through support for real estate, bonds, and infrastructure. This includes cutting mortgage rates, providing property developer support, and supporting local government debts.
- However, this initial response has been seen as underwhelming. More measures are expected but the impact of China’s stimulus on global markets, including India, remains limited.
- Global Economic Concerns:
- Rising global interest rates, monetary tightening policies from major central banks like the Federal Reserve, and expected rate hikes by the Bank of Japan have triggered market corrections globally, including in India.
- China’s policymakers are struggling with accumulated debt and consumer reluctance, further delaying recovery.
- Impact on Indian Markets:
- Foreign investors (FPIs) sold off Indian shares to pick up Chinese assets, leading to the market correction in India.
- India’s market correction has also been influenced by the global macroeconomic environment, including higher bond yields, which affect stock market valuations.
- China’s Policy Challenges:
- Despite stimulus efforts, China is facing challenges related to high levels of debt, particularly in the real estate sector. Consumers are also reluctant to spend despite government efforts.
- China’s GDP growth is expected to fall below the previously forecast 2-3% range, adding pressure on policymakers to introduce more robust stimulus packages.
- Trump’s Economic Policies (Trumponomics):
- The article briefly mentions the possible global economic impacts of Trumponomics 2.0, following Donald Trump’s potential return to power in the U.S.
Trump’s proposed tax cuts, deregulation, and tariffs on Chinese goods could influence global trade and investment flows, further affecting markets like India and China.
5. Supreme Court Guidelines to Curb Illegal Demolition of Properties
Key Points:
- Context of the Case:
- The Supreme Court laid down guidelines regarding the demolition of properties owned by individuals accused of crimes, addressing the issue of state authorities demolishing homes as punishment for alleged criminal involvement.
- The case was heard by a Bench of Justices R. Gavai and K.V. Viswanathan.
- The judgment comes in light of several instances in states like Uttar Pradesh, Madhya Pradesh, Uttarakhand, and Rajasthan, where demolitions were carried out against accused individuals without following due legal processes.
- Key Incidents Leading to the Verdict:
- In Ratlam, Madhya Pradesh, a family’s ancestral home was demolished after their son was accused of cow slaughter.
- In Udaipur, Rajasthan, a house was demolished soon after the tenant’s son was arrested for stabbing a classmate, sparking communal tensions.
- Similar cases of demolitions following communal violence or accusations of criminal activities have occurred, such as during a demolition drive in Delhi’s Jahangirpuri following communal clashes in 2022.
- Supreme Court Guidelines on Demolitions:
- The SC emphasized due process and transparency in all cases of property demolition:
- Notice Period: A minimum of 15 days’ notice must be provided to the accused or the property owner before any demolition action, detailing the reasons for demolition and allowing for a personal hearing.
- Hearing and Order: A personal hearing must be conducted, with minutes recorded, and the final demolition order must explain why demolition is the only recourse.
- Post-Order Period: After a demolition order is issued, a 15-day grace period is required to allow the property owner to either remove the construction or challenge the order in court.
- Recording the Process: If the demolition proceeds, it must be video-recorded, and a detailed inspection report and demolition report must be prepared, including the list of officials involved.
- The SC emphasized due process and transparency in all cases of property demolition:
- Rationale Behind the Guidelines:
- Separation of Powers: The SC highlighted that punishment is a function of the judiciary, not the executive. Demolishing properties as punishment without a legal trial is unconstitutional.
- Public Trust and Transparency: The SC emphasized the need for accountability and transparency in government actions. Public officials should not take law enforcement into their own hands by carrying out demolitions without following due legal processes.
- Right to Shelter: Under Article 21 of the Constitution, the right to life includes the right to shelter. Demolishing homes not only affects the accused but also innocent family members who live in the same property, which is a violation of their rights.
- Pretext of Illegal Construction: The SC stated that if demolitions selectively target properties of the accused while ignoring similar illegal constructions in the same area, it raises suspicions that the real motive is punishment and not addressing illegal construction.
Exceptions to Guidelines: The SC guidelines do not apply to demolitions of unauthorized structures on public lands (e.g., roads, footpaths, water bodies) or cases where there is a court order for demolition.
