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Leaders of the G20 grouping said it was “essential to uphold international law and the multilateral system” as “today’s era must not be of war”.
In a joint declaration brought out at the end of the G20 summit in Bali, Indonesia, the multilateral organisation said that the war in Ukraine is causing economic difficulties and insecurity worldwide and termed the threat of using nuclear weapons in the war as “inadmissible”.
However, the leaders’ declaration also revealed that not all member states condemned the Russian action against Ukraine. Most members strongly condemned the war in Ukraine and stressed it is causing immense human suffering and exacerbating existing fragilities in the global economy - constraining growth, increasing inflation, disrupting supply chains, heightening energy and food security and elevating financial stability risks.
The statement was issued soon after U.S. President Joe Biden chaired an emergency meeting of the western bloc in Bali after a missile from the Ukrainian battlefield landed in Przewodow in eastern Poland near the Polish border with Ukraine. NATO countries called for an emergency meeting to determine who exactly fired the missile.
Following the summit, Foreign Secretary Vinay Mohan Kwatra said that the “outcome document” was adopted through “consensus” among the G20 members and that India contributed “constructively” in the drafting of the text.
The consensus document going forward will be a positive development as we take over the presidency of the G20 on first of December.
At COP27 India and three others oppose ‘carbon border tax’ (Page no. 1)
(GS Paper 3, Environment)
With the 27 th edition of the Conference of Parties (COP) in Sharm El Sheikh nearing its final stages and efforts being ramped up to arrive at a conclusive agreement, a consortium of countries that includes India has jointly stated that carbon border taxes, that could result in market distortion and aggravate the trust deficit amongst parties, must be avoided.
The European Union has proposed a policy — called the Carbon Border Adjustment Mechanism — to tax products such as cement and steel, that are extremely carbon intensive, with effect from 2026.
BASIC, a group constituting Brazil, India, South Africa and China, and therefore large economies that are significantly dependent on coal, has for several years voiced common concerns and reiterated their right to use fossil fuel in the interim during their countries’ eventual transformation to clean energy sources.
“Unilateral measures and discriminatory practices, such as carbon border taxes, that could result in market distortion and aggravate the trust deficit amongst Parties [signatory countries to the United Nations climate agreements], must be avoided. BASIC countries call for a united solidarity response by developing countries to any unfair shifting of responsibilities from developed to developing countries.”
Their joint statement on Wednesday expressed “grave concern” that developed countries were still not showing leadership or responding with a matching progression of effort. Developed countries had “backtracked on finance and mitigation commitments and pledges” and there was a “significant increase” in the consumption and production of fossil fuels in the past year by developed countries, their statement underlined, even as they continue to press developing countries to move away from the same resources. “Such double standards are incompatible with climate equity and justice.”
Editorial
This unseating of vice chancellors is faulty (Page no. 6)
(GS Paper 2, Polity and Governance)
Two recent judgments of the Supreme Court of India on the appointment of vice chancellors (VC) in State universities in violation of the regulations of the University Grants Commission (UGC) are significant in the context of higher education in a federal country such as India.
In the first case, Gambhirdan K. Gadhvi vs The State Of Gujarat(March 3, 2022), from Sardar Patel University, Gujarat, the Court (Justices M.R. Shah and B.V. Nagarathna) quashed the appointment of the incumbent Vice Chancellor on the ground that the search committee did not form a panel for the appointment of VC, and, therefore, was not in accordance with the UGC Regulations of 2018.
It was held that since the State law was repugnant to the UGC regulations, the latter would prevail and the appointment under the State law had become void ab initio.
In the second case, from Kerala, i.e., Professor (Dr) Sreejith P.S vs Dr. Rajasree M.S. (October 21, 2022), with the Bench of Justices M.R. Shah and M.M. Sundresh, the appointment of the Vice Chancellor of the A.P.J. Abdul Kalam Technological University, Thiruvananthapuram, was challenged on the ground that the search committee recommended only one name, which is against the UGC Regulations.
The challenge succeeded and the Court quashed the appointment of the VC on the ground that the provision relating to the search committee in the University Act is repugnant to the UGC Regulations, and was therefore void.
But this decision of the Supreme Court triggered unprecedented developments in Kerala with the State Governor, Arif Mohammad Khan, who is the Chancellor of all the universities in Kerala, asking as many as 11 VCs of other universities of the State to resign immediately on the ground that their appointments too had become void after the Supreme Court’s judgment.
Opinion
Quest for transparency in FTA negotiations (Page no. 7)
(GS Paper 3, Economy)
To achieve the export target of $2 trillion by 2030, India is going the whole hog on free trade agreements (FTAs). India is negotiating FTAs with countries such as the European Union, Canada, the U.K., and Israel.
These FTAs cover a wide array of topics such as tariff reduction impacting the entire manufacturing and the agricultural sector; rules on services trade; digital issues such as data localisation; intellectual property rights that may have an impact on the accessibility of drugs; and investment promotion, facilitation, and protection.
Consequently, an FTA has a far-reaching impact on the economy and society. Given this, one legitimately expects transparency and greater scrutiny of the FTA process both during and after the negotiations.
But India negotiates most FTAs behind closed doors with very little information about the objectives and processes followed and negligible scrutiny. This is not the case in other countries with whom India is negotiating such an FTA.
In the U.K., for example, there are several robust mechanisms that foster a certain degree of transparency in the FTA negotiations. Furthermore, there are institutional apparatuses that enable the scrutiny of the actions of the executive, during and after the signing of the FTA. Let us look at these mechanisms.
First, the Department of International Trade (DFIT), U.K., publishes a policy paper laying down the strategic objectives behind negotiating an FTA and why it is important for the U.K. to have an FTA with a particular country.
This policy paper is fairly detailed listing the specific advantages of signing an FTA such as the economic gains expected, distributional impacts, the environmental impact, and the labour and human rights dimensions of the FTA.
Explainer
Who should pay for climate damage? (Page no. 8)
(GS Paper 3, Environment)
At the G-20 summit in Bali, rich nations including the U.S., Japan and Canada have pledged $20 billion to wean Indonesia off coal.
The U.S. and Japan have led the International Partners Group to mobilise funds from the public and private sector to support Indonesia’s efforts to reach carbon neutrality by 2050.
But a lot more needs to be done, and in that context it is significant that at the ongoing Climate Change Conference (COP27) in Egypt, compensation against loss and damage due to climate change is finally on the main agenda, unlike previous years.
Between 1900 and now, developed countries have benefitted from industrial development, which also led to greenhouse gas (GHG) emissions.
Developing countries were relatively late in starting out on economic development. They may be contributing to emissions now, but that is a weak reason to ask them to stop economic development.
A farmer in rural Africa can claim that his country has not added to emissions historically, but because of the U.S. or Russia’s industrialisation, his agriculture yields are declining.
Or an urban worker in South America has to work, without choice, in unforgiving heat wave conditions caused by the developed world’s emissions of the past. Therefore, options like financing the developing or underdeveloped countries by the developed world have been discussed.
But as a popular newsletter Finshots asked, who decides who should pay whom and how much? Ourworldindata.org cites data from the Global Carbon Project to show that between 1751 and 2017, 47% of the CO2 emissions came from the U.S. and the EU-28. In total, just 29 countries.
What is the Target level of retail inflation? (Page no. 8)
(GS Paper 3, Economy)
The story so far: India’s retail inflation dropped to a three-month low of 6.77% in October when compared to the same month last year.
Wholesale price inflation also dropped significantly from rising at double digit rates in earlier months to 8.3% in October. The drop in inflation has led to hopes that the RBI has managed to gain control over price rise.
Economists attribute the drop in inflation in October to a favourable base effect. It should be remembered that retail inflation since the pandemic has been affected by lockdowns which served as a severe shock to the economy.
Lockdowns affected the demand and supply sides in different ways, both when they were first imposed and subsequently lifted by the government. This may have led to unusual volatility in inflation figures since the pandemic.
Hence, it may be hard to compare inflation figures of the current year, in which normalcy has largely returned to the economy, with those from previous years marred by stringent lockdowns.
Easing food prices have also been cited as a reason for the recent drop in inflation. But it should be remembered that inflation refers to a general rise in the price level regardless of changes in individual prices. So, rise or fall in inflation cannot really be attributed to changes in the prices of individual goods and services.
News
India deploys new docks, upgrades speed boats for Pangong Tso patrol (Page no. 10)
(GS Paper 2, International Relations)
The Army has deployed new landing docks and speed boats for patrolling on the Pangong Tso Lake in Eastern Ladakh matching the Chinese deployments on the lake located close to 14,000 feet.
This is part of an overall capability enhancement and infrastructure development taken up by India since the 2020 standoff in Eastern Ladakh to plug deficiencies and catch up with Chinese build up along the Line of Actual Control (LAC).
“The induction has given huge impetus to our patrolling capability and we now have boats which match the adversary,” a defence source said.
The landing craft are capable of carrying 35 troops or one jeep and 12 personnel, while the speed boats can reach speeds of 35 knots, the source stated.
Early 2021, the Army had signed two contracts for the landing craft and speed boats which were delivered in the second half of 2021.
At the end of December, under a ₹65 crore contract for 12 specialised patrol craft with Goa Shipyard Limited (GSL). The second contract for 17 troop-carrying, flat-bottom fibre glass landing docks was signed with a private manufacturer also in Goa.
The landing craft are capable of carrying 35 troops or one jeep and 12 personnel, while the speed boats can reach speeds of 35 knots, officials said.
The new landing craft have also been deployed at Sir Creek in Gujarat facing Pakistan, sources stated.
Pangong Tso has been an area of constant friction between India and China for a long time. India holds one third of the 135 km-long boomerang shaped lake.
Demonetisation was part steps to boost the formal economy (Page no. 10)
(GS Paper 3, Economy)
The Union Finance Ministry told the Supreme Court that demonetisation in November 2016 was one in a series of “transformational economic policy steps” which led to a phenomenal growth in digital transactions, shrunk fake currency and saw more income tax payers.
The government claimed that the withdrawal of ₹500 and ₹1000 banknotes, which had at the time formed more than 80% of the currency in circulation, was a “critical” part of a policy push to “expand formal economy” and thin the ranks of the informal cash-based sector.
The Ministry said, post-demonetisation, the volume of digital payment transactions had increased from 1.09 lakh transactions of value of ₹6,952 crore in the entire year of 2016 to 730 crore transactions of the value of more than ₹12 lakh crore in the single month of October 2022.
The government, in its affidavit before a Constitution Bench, claimed the “overall impact of the withdrawal of legal tender of the specified banknotes on economic growth was just “transient”.
On the other hand, “real growth rate” was 8.2% in the financial year 2016-2017 and 6.8% in financial year 2017-2018, “both being more than the decadal growth rate of 6.6% in the pre-pandemic years”.
Besides, income tax authorities, who kept a keen eye on bank account deposits made between November 9 and December 30, 2016, could detect a ‘significant amount of unaccounted income”.
Demonetisation, in short, nudged the public to be tax-compliant. The number of Permanent Account Numbers (PAN) increased. Income tax payers multiplied while fake currency faded out, the government underscored.
World
U.K. and India to launch a Young Professionals Exchange in 2023: Downing Street (Page no. 13)
(GS Paper 2, International Relations)
British Prime Minister Rishi Sunak will announce a new “partnership” with India on Wednesday, at the G20 summit in Bali, Downing Street has announced. Under the U.K.-India Young Professionals Scheme, the U.K. will offer, annually, 3,000 degree-holding Indians in the 18–30-year age group places to work in the U.K. for up to two years. The scheme will commence in early 2023 and be on a reciprocal basis.
“I know first-hand the incredible value of the deep cultural and historic ties we have with India. I am pleased that even more of India’s brightest young people will now have the opportunity to experience all that life in the U.K. has to offer, and vice-versa— making our economies and societies richer.
Mr. Sunak had spoken in the summer during his campaign to be Prime Minister about having a reciprocal exchange with India.
The U.K. has more links with India than almost any country in the Indo-Pacific region,” a press note from Downing Street said, with Indians comprising almost a quarter of all international students in the U.K. and Indian investment in the U.K. supporting 95,000 jobs in the country.
The U.K. government called the launch of the program a “significant moment” for the U.K.-India relationship but also the U.K.’s links to the Indo Pacific.
Talks on finalizing a trade deal between the countries are still underway and the prospect of them concluding before a Deepavali deadline was diminished in part due to comments by British Home Secretary Suella Braverman, who had said Indians were the largest group of visa over-stayers in Britain.