GS Analyst: Daily Current Affairs

India’s plan to set up a national carbon market received a significant boost at the 29th Conference of the Parties (COP29) in Baku, Azerbaijan. At this climate conference, the United Nations Framework Convention on Climate Change (UNFCCC) ratified key rules for a global carbon trading mechanism under the Paris Agreement.

Key-Takeaways from COP29

• Ratification of Article 6.4 Rules
  • The COP29conference saw a consensus on rules for projects to qualify for carbon credits under Article 6.4 of the Paris Agreement.
  • Article 6 enables countries to meet their Nationally Determined Contributions (NDCs)—the climate targets each country sets to reduce emissions—through market-based mechanisms, such as carbon credits.
  • The approval of these rules ensures that carbon creditscan now be issued, traded, and used under the UNFCCC framework to offset emissions and support national climate commitment.
• Global Carbon Market and Integrity
  • The ratified rules are designed to ensure that the international carbon market operates with integrity—meaning the emission reductions achieved are real, additional, verified, and measurable.
  • This aims to increase demand for carbon credits, facilitating climate action and investment in emission-reduction projects, especially in developing countries.
• India’s Delayed Carbon Market Launch
  • India had faced delays in setting up its own carbon market due to the non-finalisation of rules under Article 6. Indian officials have projected that India’s carbon marketcould begin operations by late 2025 or 2026, three years after the government authorized the Bureau of Energy Efficiency (BEE) to create the necessary mechanisms.
  • India has been keen on using Article 6-compliant markets to channel investments in emission-reduction projects, leveraging cost-effective mitigation strategies.
• Article 6: Key Framework for Global Carbon Markets
  • Article 6of the Paris Agreement allows countries to achieve their emission reduction targets through international cooperation, using market-based mechanisms.
  • Article 6.4, approved at COP29, establishes a carbon crediting mechanismwhere emission reductions can be traded internationally.
  • These credits will be used by countries to meet their climate goals under the Paris Agreement, while also allowing companies to comply with their national regulations.

What is Carbon Market?

• Carbon markets, also known as emissions trading mechanisms, are trading systems in which carbon creditsare sold and bought.
• It is a mechanism that internalises the cost of greenhouse gas (GHG) emissionsin goods and services.
• Companies or individuals can use carbon markets to compensate for their greenhouse gas emissions by purchasing carbon credits from entities that remove or reduce greenhouse gas emissions.
• There are broadly two types of carbon markets:
  • Compliance marketsare created as a result of any national, regional and/or international policy or regulatory requirement.
  • Voluntary carbon markets (national and international) refer to the issuance, buying and selling of carbon credits, on a voluntary basis.
• Compliance Procedure: In August 2024, the Bureau of Energy Efficiency (BEE),responsible for implementing CCTS, released the scheme’s compliance procedures. However, specific emission targets are still to be announced.
• Purpose of a Carbon Market in India
• The goal is to move towards a more efficient use of energy, switching from fossil fuels to renewable energy as power generation increases.
• Nationally Determined Contributions (NDCs):This scheme is part of India's commitment under the Paris Agreement to reduce emissions intensity by 45% from 2005 levels by 2030.
• Net-Zero Target:India has also pledged to become a net-zero emitter by 2070.
• India is the world’s third-largest carbon emitter, contributing 3%to the global greenhouse gas emissions in 2021.

Current State of Carbon Markets in India

• Globally, there are over 28 emission trading systemsin existence, and plans are in place for more than 21 additional national and sub-national emission trading markets. Meanwhile, India is actively developing a framework for its domestic carbon market.
• India currently operates two market-based emission reduction schemes: the Perform, Achieve and Trade (PAT) scheme and the Renewable Energy Certificates (REC) system.
  • PAT schemetargets energy-intensive industries such as aluminium, cement, chlor-alkali, fertiliser, iron and steel, paper and pulp, railways, thermal power and textil Under this scheme, the government sets energy reduction goals, known as specific energy consumption (SEC), for companies in particular sectors. If a company uses less energy per unit of production than the established targets, it can earn certificates (ESCerts) as a reward for saving energy. The earned ESCerts can be traded on Power Exchanges and purchased by other units participating in the PAT scheme to fulfill their compliance needs.
  • REC systemoperates under the Renewable Purchase Obligation (RPO), which mandates electricity generators to produce a certain percentage of their total power from renewable sources like solar and wind, etc. These certificatescan be traded and are intended to promote the use of renewable energy sources.

Carbon Credit Market and India's Role

• India is expected to benefit from carbon markets by attracting climate finance, especially in sectors like energy, industry, and clean technology.
• India is hoping to reduce emissionswhile promoting economic growth through the trade of carbon credits in the international market.
• As per the UN Climate Change, the climate finance needs of 98 nationsare estimated at $500 billion annually, with Article 6 potentially providing $250 billion of that amount, mainly through cross-border cooperation and investments.

During the 6th Subgroup meeting of the Land Port Authority of India (LPAI) with the Bangladesh Land Port Authority (BLPA), India and Bangladesh decided to enhance cooperation in building infrastructure and operational efficiency at the various land ports and check-posts located along the 4,096-km long shared international border.

Key-highlights of the Meeting (India-Bangladesh Land Port Cooperation)

• During the recent meeting, several key initiatives were discussed to boost infrastructure at land portsand improve trade facilitation. Among the major agenda points were:
  • Development of port facilities: Focused on the Gede-Darshna (West Bengal-Bangladesh)and Bholaganj (Meghalaya) ports to streamline trade processes.
  • Expediting cargo clearance: The Petrapole (West Bengal)and Agartala (Tripura) ports were identified for faster clearance of Bangladesh’s export cargo to reduce delays and enhance efficiency.
  • Construction of Integrated Check Posts (ICPs): Both countries discussed plans for the creation of new ICPsand the improvement of existing ones. This includes the proposal for a common cargo gate at Bhomra (Ghojadanga in West Bengal) to facilitate smoother trade exchanges.
• Special Emphasis on Regional Connectivity
  • Facilitating transit for Bangladeshi trucks: Discussions took place regarding the movement of Bangladeshi truckscarrying exports to Nepal and Bhutan via ports like Burimari and Banglabandha. This would help Bangladesh secure additional trade routes to its landlocked neighbours.
  • Operationalising new ports: The Sabroom (Tripura)land port was discussed for quick operationalisation to handle increased cross-border traffic. Similarly, the Tegamukh (Bangladesh)-Kawrpuichhuah (Mizoram) land port was also highlighted for development to boost connectivity between India’s northeastern states and Bangladesh.
  • 24x7 operations: There was a strong push to establish certain land ports as 24x7 operational points, which would further ease the flow of goods, making trade between the two countries more efficient and timely.
• The initiatives also fall in line with broader regional connectivity goalsunder frameworks like the BBIN (Bangladesh, Bhutan, India, Nepal) Initiative and other regional trade and infrastructure cooperation agreements.

As the wheat sowing season in Haryana has progressed, farmers across the state are grappling with the shortage of di-ammonium phosphate (DAP). Due to this, more and more growers are opting for complexes - mainly combinations of nitrogen, phosphorus, potash, and sulphur (NPKS) in various grades.

About DAP

• DAP is a fertiliser crucial for sowing of Rabi crops like wheat and mustard.
• DAP contains 46 per cent phosphorus (P), a nutrient crops need at the early growth stage of root establishment and development.
• It also fulfils the initial need for nitrogen and sulphur in the crops.
• DAP provides critical nutrients for crops such as wheat and mustard, that are usually sowed during the months of October and November.
• Advantages:

• It provides a source of phosphorus in phosphate form, accompanied by a higher nitrogen content than MAP.
• Nitrogen is in ammonium form, which is readily-available for plant uptake.
• Higher solubility than MAP

• Drawbacks:

• It produces a higher localized pH in the soil than MAP, which can hinder seed germination and nutrient uptake under certain soil conditions.
• There is greater potential for nitrogen loss than MAP when surface-applied

• Alternatives to DAP include complex fertilisers containing nitrogen (N), P, potassium (K) and sulphur (S) in varying proportions, such as 12:32:16:0, 10:26:26:0, 20:20:0:13 and single super phosphate or SSP (0:16:0:11).
  • These have much less P content compared to DAP.
• India primarily depends on imports for this essential fertiliser.
• The DAP imports are affected due to the Red Sea crisis going on since January, due to which fertiliser ships had to cover an additional distance of 6,500 kilometres through the Cape of Good Hope [circumnavigation Africa].

India's retail inflation surged to 6.21% in October 2023, marking the highest level in 14 months. The inflation rate exceeded the Reserve Bank of India's target range of 2% to 6% for the first time since August 2023. This rise in inflation is being attributed primarily to sharp increases in food prices, especially vegetables and edible oils.

Key Findings

• Overall Inflation Rate
  • In October, India's retail inflation stood at 21%, up from 5.49%in September.
  • This marked a significant jump from earlier months: 65% in Augustand 3.54% in July.
• Food Prices Drive Inflation
  • The inflation in food pricessurged to a 15-month high of 10.87% in October, compared to 24% in September.
  • Food inflation was notably higher in urban areas (11.09%)compared to rural areas (10.69%).
• Key Drivers of Food Inflation
  • Vegetablessaw the steepest price rise, with inflation reaching 18%, up from 35.99% in September.
  • Edible oilsalso saw a sharp increase in inflation, rising from 47% in September to 9.51% in October, largely due to a 27% rise in global prices caused by supply disruptions.
• Causes of Food Price Hikes
  • The surge in vegetable prices, particularly tomatoes and onions, was driven by unseasonal rainsand extended monsoons in certain parts of India.
  • The global rise in edible oil prices is due to supply disruptions, affecting inflation in the oils and fats sector.

The Defence Research and Development Organisation (DRDO) successfully conducted the maiden flight test of the Long-Range Land Attack Cruise Missile (LRLACM). 

About LRLACM

• The Long Range Land Attack Cruise Missile (LRLACM) is designed to enhance India's capabilities in strategic defence and long-range precision strikes.
• Developed by: Defence Research and Development Organisation’s (DRDO) Aeronautical Development Establishment (ADE)in Bengaluru, with contributions from several DRDO laboratories and Indian industries.
  • Bharat Dynamics Limited (BDL)in Hyderabad and Bharat Electronics Limited (BEL) in Bengaluru were the Development-Cum-Production Partners involved in the missile’s development and integration.
• Mission Mode Project: LRLACM is a Defence Acquisition Council (DAC)-approvedproject, sanctioned under the Acceptance of Necessity (AoN)
  • The project is considered a Mission Mode Project, which is typically used for critical defence capabilities requiring immediate operational readiness.
• Key Features of LRLACM
  • Launch Flexibility: The missile is designed to be launched from mobile ground-based systemsand frontline ships, offering enhanced operational flexibility. It uses a universal vertical launch module system, allowing for easy integration with different launch platforms.
  • Missile Design: LRLACM is configured to be launched both from mobile articulated launcherson land and naval vessels, making it adaptable to various operational environments.

Uranus has long been a subject of curiosity. Despite being a gas giant, it remains one of the least explored planets. The only spacecraft to visit it was NASA's Voyager 2, which flew past Uranus in 1986. However, new research suggests that the data collected by Voyager 2 might have been skewed due to unusual conditions during the flyby.

Key Findings of the Study

• This recent study published in the journal Nature Astronomychallenges the previous findings, suggesting that our understanding of Uranus, particularly its magnetosphere and moon activity, might need to be revisited.
• Voyager 2’s Flyby and Solar Wind Effects
  • Voyager 2’s Flyby: In 1986, Voyager 2 passed by Uranus at a distance of about 81,500 km. During this pass, the spacecraft observed the planet’s magnetosphere, the protective magnetic field around Uranus.
  • Effect of Solar Wind: However, during this flyby, Uranus was affected by a powerful solar wind, which caused significant changes to its magnetosphere. This weakened its typical properties, making it look quite different from the magnetospheres of other gas giants like Jupiter and Saturn.
• Impact on Findings: Scientists believe that if the spacecraft had passed a week earlier or later, the data could have shown a very different picture of Uranus' magnetic field.
• Magnetosphere of Uranus: New Insights
  • Asymmetry and Radiation: Uranus' magnetosphere is highly asymmetricand has intense radiation belts. Unlike other gas giants, Uranus has a unique magnetic field that scientists are still trying to understand fully.
  • Revised Understanding: The findings suggest that Voyager 2 might not have captured the true nature of Uranus' magnetic field due to the specific timing of its flyby.
• Implications for Uranus’ Moons
  • Moons of Uranus: Uranus has five major moons, and they were previously thought to be geologically inactive. The lack of plasma (charged particles) in Voyager 2's data was once seen as an indication that the planet was in a state of "quiescence" (calm and inactive).
  • New Possibilities: However, new analysis suggests that Uranus' moons might not be as inactive as once believed. There is now speculation that some of the moons could be geologically active, meaning they may have ongoing internal processes like volcanoes or tectonic activity.

The India-Middle East-Europe Corridor (IMEC) was announced in September 2023 during the G20 summit in New Delhi, marking a significant step towards enhancing global trade connectivity. The corridor aims to reduce transit times and costs by 40% and 30%, respectively, compared to the traditional Suez Canal route. While the corridor promises to be a game-changer for international maritime trade, progress on the project has been delayed due to geopolitical tensions in the West Asian region, particularly the ongoing conflict between Israel and Palestine.

Geopolitical Challenges and Delayed Progress

• Impact of West Asian Conflict: The normalization of Arab-Israel relations, a critical component for the successful implementation of IMEC, has been disrupted due to the Israel-Palestine conflict. This geopolitical crisis has caused delays, particularly in the northern part of the corridor, which involves key stakeholders like Saudi Arabia and Jordan.
• Slower Northern Implementation: Given the diplomatic complexities and political sensitivities, work on the northern leg of the IMEC is expected to proceed at a slower pace until the security situation in the region stabilizes. This will delay the full realization of the corridor’s potential.
• Strategic Importance of the Project: Despite these setbacks, the IMEC remains a highly significant project, especially for global trade routes, as it promises to reduce shipping time and costs, positioning the corridor as a key alternative to the Suez Canal.

Progress on the Eastern Leg and India-UAE Cooperation

• Growing India-UAE Trade: On the eastern leg of the IMEC, there has been significant progress, particularly in bilateral trade between India and the UAE, which has grown by 93% from 2020 to 2023, driven by the Comprehensive Economic Partnership Agreement (CEPA).
• Non-Oil Trade Expansion: The shift towards non-oil trade between India and the UAE has strengthened the corridor’s role in fostering diversified trade. This trade expansion is crucial for India’s broader goals to increase its exports via the IMEC.
• Virtual Trade Corridor: The launch of the Virtual Trade Corridor between India and the UAE aims to streamline cross-border trade processes, reducing administrative and logistical costs. This initiative is a step toward creating a model for facilitating trade across all IMEC participant countries.

Future Prospects and India’s Role in IMEC

• India’s Port and Logistics Development: India has the opportunity to use the delays in the northern leg of the IMEC to enhance its port infrastructure and domestic logistics. Streamlining logistics and improving the digital footprint in the sector will make Indian exports more competitive.
• Integration into Global Supply Chains: The full benefits of the IMEC will be realized only if India can strengthen its manufacturing sector and enhance its integration into global value chains. This is essential for India to become a viable global supply chain alternative.
• Need for an IMEC Secretariat: To ensure the smooth functioning of the project, an IMEC Secretariat should be established to coordinate activities, streamline trade, and provide empirical data on the benefits for participating countries. This could also encourage other nations to join the corridor.

Practice Question:

Q. Discuss the challenges and opportunities posed by the India-Middle East-Europe Corridor (IMEC) for India’s trade and connectivity strategy. How can India leverage its role in the corridor to strengthen its position in global supply chains?

The diplomatic row between India and Canada has escalated following Canada's public accusations of Indian involvement in the 2023 murder of Khalistan activist Hardeep Singh Nijjar. This has severely impacted bilateral relations, with tensions rising after incidents of violence involving Khalistan activists in Canada, disrupting consular services. The row is affecting India-Canada ties on multiple fronts, including trade, consular services, and the Indian diaspora in Canada, which numbers over 19 lakh people.

Diplomatic Tensions and Disruptions

• Violence Against Indian Diplomats: A consular services camp recently organized by the Indian mission in Canada at the Hindu Sabha Mandir in Brampton was violently disrupted by Khalistan activists. This incident was condemned by Indian Prime Minister Narendra Modi as a “deliberate” attack on diplomats, with Canadian Prime Minister Justin Trudeau also calling it “unacceptable.”
• Bilateral Relations Strained: The ongoing diplomatic row has affected not only the security of Indian diplomats but also caused setbacks to India-Canada trade relations, which are worth approximately $19 billion. Despite the tensions, both countries had initially sought to boost trade through a bilateral trade treaty, though negotiations have now stalled.
• Impact on Consular Services: The diplomatic crisis has disrupted the normal functioning of consular services, which are crucial for Canada's Indian-origin population of 19 lakh. Given that many people have close ties with India and require various consular services, the disruption has affected the daily lives of these individuals.

Challenges in Bilateral Cooperation and Diaspora Politics

• Diaspora Politics and Communal Tensions: The political fallout from the ongoing Khalistan movement and associated diaspora politics has caused significant unrest in Canada, impacting India-Canada relations. Both countries need to ensure that communal mobilizations, particularly those affecting diaspora communities, are not allowed to disrupt bilateral cooperation or undermine social harmony.
• Visa and Immigration Issues: Amid rising political tensions, visa issuance between India and Canada has been disrupted, particularly impacting Indian students in Canada. The new Canadian restrictions on student visas have added to the challenges, as Indian aspirants represent a significant portion of foreign students in the country.
• Convergence on Global Issues: Despite the diplomatic crisis, India and Canada share significant convergence on global issues like climate change. Both nations should work towards protecting these areas of cooperation, even as they navigate through the current turbulence fueled by fractious diaspora politics.

Practice Question:

Q. Examine the implications of the recent diplomatic row between India and Canada on their bilateral relations, particularly in terms of trade, consular services, and the Indian diaspora. How can both countries navigate the current challenges to restore cooperation?"

The World Bank’s Report on Healthy Longevity published in September 2024 highlights the critical challenge posed by the rising prevalence of non-communicable diseases (NCDs) in Low-and-Middle-Income Countries (LMICs), especially India. The report stresses the urgency of tackling aging populations and NCD-related deaths while providing strategies for healthy longevity. India, with its rapidly aging population, faces significant challenges in curbing NCDs such as cardiovascular diseases, diabetes, and cancer, which are leading causes of mortality and morbidity.

Demographic and Health Trends in India

• Aging Population: India’s elderly population (60+) stands at 140 million, making it the world’s second-largest. The elderly population is growing at a rate three times higher than the overall population growth rate.
• Prevalence of NCDs: NCDs now account for over 50% of all deaths in India, with cardiovascular diseases, cancer, diabetes, and respiratory diseases being the leading causes. By 2030, NCDs are projected to account for three-quarters of all deaths in the country.
• Health Risks and Behavioral Factors: Key risk factors for NCDs include tobacco use, alcohol abuse, obesity, and sedentary lifestyles. Additionally, poor dietary habits with increasing intake of processed foods contribute significantly to the rising incidence of chronic diseases.

Socioeconomic Impact of NCDs

• Financial Burden on Families: The treatment of chronic diseases imposes a severe financial burden on families, with out-of-pocket expenses for hospital visits and medicines pushing many into indebtedness.
• Inadequate Social Security: India’s social security schemes, like the Ayushman Bharat Scheme, offer limited financial relief due to meagre pension amounts, rigorous eligibility requirements, and administrative inefficiencies.
• Lack of Healthcare Access: Rural areas face significant challenges in accessing primary healthcare, with infrequent screenings and limited healthcare infrastructure exacerbating the burden of NCDs, particularly in remote regions.

Policy and Health System Challenges

• Healthcare Infrastructure: The quality of private healthcare is often compromised by inflated prices and unregulated hospital fees. The Supreme Court’s 2024 directive to regulate healthcare pricing highlights ongoing concerns over affordability.
• Inefficiencies in Health Insurance: Health insurance schemes like Ayushman Bharat are not fully effective due to bureaucratic delays, corruption, and lack of awareness about eligibility, limiting their reach among the poorest.
• Need for Behavioral Change: Addressing NCDs requires behavioral reforms, such as promoting physical activity and reducing consumption of unhealthy foods. A taxation policy on unhealthy products, such as tobacco and sugary foods, is suggested to curb the rising burden of NCDs.

Practice Question:

Q. India’s rapidly aging population and rising burden of non-communicable diseases (NCDs) pose significant challenges to public health and economic growth. Discuss the socio-economic impact of NCDs in India, highlighting the role of social security schemes, healthcare access, and necessary policy reforms.