The La Nina and North India’s pollution
Why in News?
The delayed La Niña and late monsoon retreat may worsen North India’s air quality, especially in Delhi, raising concerns over winter pollution and stubble burning.
La Niña and Air Quality
The delayed onset of La Niña and the late monsoon retreat have impacted air quality predictions for Delhi and North India. La Niña, usually linked to stronger winds that disperse pollutants, has not yet developed, raising concerns about high pollution levels in the early winter months. The earliest La Niña is expected to develop is between September and November 2024, meaning stagnant winds will likely exacerbate pollution in autumn and early winter.
Pollutant Dynamics in Delhi
Extended periods of high humidity and calm winds due to the slower monsoon retreat are expected to trap pollutants near the surface. This will elevate PM2.5 and PM10 levels, worsening air quality. The post-monsoon anti-cyclonic circulation further reduces atmospheric mixing, contributing to higher pollution levels.
Impact of Stubble Burning
With dominant north-westerly winds and weak La Niña conditions, stubble burning will worsen Delhi’s air quality. If La Niña strengthens in December, stronger winds may reduce pollutants, but severe winter could worsen air quality.
Link to Climate Change
Extreme air pollution events are increasingly linked to climate change. Changes in atmospheric circulation patterns, wind behavior, and pollutant dispersion are influenced by global warming, complicating air quality management.
Policy Shifts
The focus needs to shift from local emission-centric strategies to broader meteorological and climatological factors, especially in cities like Delhi. There is a need for a resource framework prioritizing health-centric measures, integrating larger airshed management, and addressing both PM2.5 and PM10 pollution. Currently, there is an overemphasis on PM10, which has misallocated resources and priorities.
Conclusion
La Niña affects North India’s air quality, necessitating comprehensive strategies addressing meteorological factors and public health concerns.
For the first time in 42 months, core sectors’ output tanked in August
Why in News?
In August 2024, India’s core sector output witnessed a 1.8% year-on-year contraction, marking the first decline in 42 months, with six of eight core infrastructure sectors showing reduced production.
Key Statistics on Core Sector Output
Decline in Core Sector Growth
The Index of Core Industries (ICI) fell to 155.8 in August 2024, a 4.2% decline from July. This was the third consecutive month of sequential decline.
Sectors in Contraction
Out of eight core sectors, six experienced a contraction:
- Coal output declined by 8.1%.
- Electricity generation dropped by 5%, reaching a five-month low.
- Cement production fell 3%, the worst in nine months.
- Refinery products declined 1%, the second drop in three months.
Sectors with Positive Growth
Fertilizer output grew by 3.2%. Steel production saw a modest increase of 4.5%, the slowest in 26 months.
Impact on Broader Industrial Output
Industrial Production Index (IIP): The core sector makes up 40% of the IIP; weaker factory output is anticipated for August 2024 despite July’s 4.8% growth.
Contributing Factors: High growth in August 2023 skews performance; late monsoon withdrawal hampers output in cement and steel sectors, says Bank of Baroda.
Challenges for Core Sectors
Monsoon’s Impact: The delayed monsoon withdrawal is expected to continue affecting output in September 2024, especially in construction-related sectors.
Base Effect: The strong growth in 2023 has created a high comparison base, influencing the performance metrics for 2024.
Outlook and Predictions
Marginal Industrial Growth: Experts estimate mild industrial output growth for August, with predictions of around 0.5%-1%. This is a significant decline compared to earlier months.
Future Sector Performance: Weak performance in core sectors like cement and steel signals ongoing sluggishness in construction and industrial activity for the year.
Conclusion:
India’s core sector output contracted for the first time in three years, impacted by weak coal, electricity, and construction sectors, creating uncertainty in future industrial output.
India’s Current Account Deficit in Q1 FY25 Widens to $9.7 Billion
Why in News?
On September 30, 2024, RBI reported India’s current account deficit widened to $9.7 billion in Q1 FY25, compared to $8.9 billion last year.
Widening Current Account Deficit (CAD)
India’s CAD widened marginally in Q1 FY25, primarily due to an increase in the merchandise trade deficit, which rose to $65.1 billion from $56.7 billion in Q1 FY24. The revised surplus for Q4 FY24 was brought down to $4.6 billion from the earlier figure of $5.7 billion due to an upward adjustment in customs data on merchandise imports.
Merchandise Trade and Services
The larger trade deficit was a significant contributor to the widening of CAD. However, net services receipts increased to $39.7 billion in Q1 FY25 from $35.1 billion in Q1 FY24, driven by growth in exports of computer services, business services, travel services, and transportation.
Private Transfer Receipts (Remittances):
Private transfer receipts, including remittances by Indian workers abroad, rose to $29.5 billion in Q1 FY25, up from $27.1 billion a year earlier.
Primary Income Account:
Payments under the primary income account, largely reflecting investment income outflows, increased to $10.7 billion in Q1 FY25 from $10.2 billion in Q1 FY24.
Financial Account and Investments:
- FDI inflows rose to $6.3 billion in Q1 FY25, up from $4.7 billion in the same period last year.
- Foreign portfolio investment (FPI) inflows moderated sharply to $0.9 billion from $15.7 billion in Q1 FY24, while external commercial borrowings (ECBs) also declined to $1.8 billion from $5.6 billion.
- Non-resident deposits (NRI deposits) saw an increase in net inflows, rising to $4.0 billion from $2.2 billion in Q1 FY24.
Forex Reserves:
India’s foreign exchange reserves saw an accretion of $5.2 billion on a balance of payments (BoP) basis in Q1 FY25, significantly lower than the $24.4 billion accretion in the same period last year.
Expert Commentary:
The Chief Economist at Bank of Baroda remarked that India’s balance of payments remained stable in Q1 FY25, with a comfortable CAD of 1.1% of GDP. The widening trade deficit, particularly due to higher oil, gold, and non-oil imports, was noted. While FDI inflows improved, FPI flows declined. He projected the CAD to remain around 1.5% for FY25 if these trends persist.
Conclusion
India’s current account deficit widened in Q1 FY25 due to a larger trade deficit, despite strong services exports and remittances.
Export ban on Non-Basmati White Rice lifted: why, what is the likely impact
Why in News?
India lifted the export ban on Non-Basmati White Rice, setting a minimum price of $490 per tonne to boost trade after last year’s production dip.
Context of the Ban
The previous export ban was instituted due to a slight decline in rice production and concerns over an erratic monsoon season. With higher paddy sowing this kharif season and expected bumper output, the government decided to lift the ban.
Current Agricultural Status
Increased Sowing: As of September 20, 2024, paddy sowing has increased by 2.2% compared to last year, covering 413.50 lakh hectares.
Record Production Estimates: India’s total rice production for 2023-24 is projected to reach 137.82 million tonnes, a 1.5% increase from last year, primarily driven by enhanced kharif season yields.
Price Dynamics: Wholesale rice prices have decreased, recorded at Rs 3,324.99 per quintal, down from Rs 3,597.09 a week prior.
Impact on Stakeholders
- Exporters and Traders: The lifting of the ban will benefit traders previously burdened by a 20% export duty. It will also positively affect farmers producing premium non-Basmati varieties like Sona Masoori.
- Domestic Consumers: Retail prices of rice, which have been elevated, may increase further due to the changes in export policy.
Exports During the Ban
The government allowed exports to meet food security needs of other nations, with shipments occurring through the National Cooperative Export Limited (NCEL) to various countries, including UAE and Bhutan.
India’s Position in the Global Rice Market
India is the second-largest rice producer and the largest exporter, accounting for 33% of global rice exports in 2023, despite a drop from 40% in 2022 before the ban.
Major competitors include Thailand and Vietnam, whose combined exports closely match India’s.
Breakdown of Rice Exports:
Rice exports are divided into basmati and non-basmati categories. Non-Basmati White Rice accounts for significant exports, with the government’s lifting of the ban expected to enhance these numbers.
Conclusion
Lifting the export ban on Non-Basmati White Rice aims to boost trade and support farmers, but may raise retail prices, requiring careful monitoring of market impacts.
Steady but slow: On the VIPER mission, lessons for India
Why in News?
India’s growing space program faces resource constraints, limiting its ability to match global exploration developments.
NASA Cancels VIPER Mission
NASA cancelled the VIPER mission in July 2024 due to delays and rising costs, disappointing scientists who aimed to explore lunar water-ice.
Global Lunar Competition
VIPER’s cancellation raises concerns about China’s lunar advancements, opening commercial and geopolitical opportunities, impacting the U.S.-led Artemis Accords involving India.
ISRO’s Limitations
ISRO gained acclaim for Chandrayaan-3’s success but struggles to execute multiple flagship missions, limiting responsiveness and emerging space opportunities with its “one major mission at a time” model.
Chandrayaan-4 and Missed Opportunities
Chandrayaan-4 marks the second phase of India’s lunar programme. ISRO could have pursued the Lunar Polar Explorer Mission with Japan’s space agency, which aims to perform tasks similar to the cancelled VIPER mission, such as mapping water-ice deposits.
Challenges Facing India’s Space Programme
- Resource Constraints: ISRO, despite increased funding, lacks resources for simultaneous large-scale missions, unlike NASA and China’s CNSA.
- Global Lunar Leadership: As a signatory of the Artemis Accords, India risks falling behind in the renewed lunar race for resources like water-ice.
- Strategic Importance of Lunar Exploration: The cancellation of NASA’s VIPER mission underscores the importance of lunar exploration in geopolitical and commercial arenas. ISRO’s slower pace and limited resources could hinder its ability to lead in this critical area.
Outlook and Way Forward
- Need for Increased Funding: India’s space program needs greater resources and infrastructure to avoid bottlenecks and compete in global exploration.
- Leveraging International Partnerships: Collaborating with international partners like Japan on the Lunar Polar Explorer Mission could enhance India’s lunar exploration capabilities.
Conclusion
ISRO’s success highlights capabilities, but resource limits hinder multiple missions; increased funding is essential for lunar leadership.
Having Private Participation in India’s Nuclear Energy
Why in News?
In July 2024, India announced plans to expand nuclear energy, inviting private sector participation in Bharat Small Reactors and Bharat Small Modular Reactors to achieve 2030 decarbonization goals.
Government’s Nuclear Energy Expansion Plans
In the 2024-25 Union Budget, India proposed private partnerships to develop Bharat Small Reactor, Bharat Small Modular Reactor, and new nuclear technologies, aiming for 500 GW of non-fossil energy by 2030, aligned with the country’s COP26 commitments.
Legal Framework: Atomic Energy Act, 1962 (AEA)
- The AEA, amended in 1987, grants the central government sole control over the production, development, and disposal of atomic energy, restricting private sector involvement.
- The Supreme Court upheld these restrictions in the case of Sandeep T.S. vs Union of India & Ors. (September 2024), noting the importance of strict safeguards in the exploitation of nuclear power.
- Pending Legal Challenges: The Civil Liability for Nuclear Damage Act, 2010 (CLNDA), designed to provide compensation for victims of nuclear accidents, is currently facing a constitutional challenge in the Supreme Court.
Challenges to Private Participation
- Strict Regulatory Controls: The Atomic Energy Regulatory Board (AERB), established under the Atomic Energy (Radiation Protection) Rules, 2004, supervises the use of radioactive technology.
- The Nuclear Safety Regulatory Authority Bill 2011, intended to strengthen regulatory oversight, was never enacted.
- Liability Concerns: High liability standards under India’s 2010 Nuclear Damage Act complicate investments due to no-fault liability and constitutional litigation.
- Public-Private Partnerships (PPP): It could involve NPCIL retaining 51% ownership while inviting private capital for nuclear development.
Outlook and Way Forward
- Legislative Reforms: The NITI Aayog report urges a clear regulatory framework and liability structure to attract private investment in Small Modular Reactors.
- Financial and Technical Investments: The Union Budget aims to attract $26 billion in private investment for nuclear energy, needing regulatory reforms to address legal uncertainties.
Conclusion
Private sector participation is vital for India’s energy goals, requiring legislative reforms to address restrictions and legal challenges in the nuclear energy sector.
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