Best UPSC Academy in Hyderabad
TRUMP'S TARIFF POLITICS AND THE IMPACT ON INDIA-US STRATEGIC RELATIONS
TOPIC: (GS2) INTERNATIONAL RELATIONS: INDIAN EXPRESS
The Trump administration has imposed new tariffs as part of its “Make America Great Again” policy, impacting allies like India. These measures are straining India-US ties and raising concerns over long-term trust in the strategic partnership.
Brief on the Issue
- The US under Donald Trump is pursuing an aggressive tariff strategy mainly against China, but friendly countries like India are also facing economic pressure.
- This approach introduces transactional politics in international relations, challenging India’s expectations of a stable and strategic
India’s Diplomatic Challenge:
- India is in a tough spot balancing its relationship with the US while dealing with sudden economic
- Despite engaging in early talks and maintaining strong diplomatic ties, India is still affected by broader US economic decisions.
- The tariffs reflect a shift from long-term partnership to short-term deals, adding friction.
China as the Main Focus:
- Trump’s administration sees China as the biggest threat to US dominance, both economically and
- Unlike his earlier term, Trump now has fewer checks and is more assertive in his actions.
- This anti-China push includes urging companies to relocate their supply chains, creating ripple effects for global trade.
- Weakening trust between India and the US. A balanced, targeted approach is needed to maintain long-term diplomatic stability.
REFORMING INDIA’S BILATERAL INVESTMENT TREATY (BIT) MODEL
TOPIC: (GS3) ECONOMY: INDIAN EXPRESS
Context (Brief about the Issue):
- India’s 2015 model BIT was designed to protect the country’s right to regulate but has struggled to attract new investment partners.
- The government is now considering making the treaty more balanced to draw foreign investment and safeguard Indian investors abroad.
Need for Reform in India’s BIT Framework
- The current BIT model is seen as too defensive and not investor-friendly, leading to limited international acceptance.
- The Finance Minister’s openness to revising it shows the government’s recognition of its
- Over the past decade, India has signed very few BITs under the 2015 model, pointing to the urgency for a more practical and appealing
Debate on Dual BIT Models
- Some experts suggest India should adopt two BIT models:
- One model favourable to foreign investors (when India is importing capital).
- Another favouring Indian interests (when India is exporting capital).
- This proposal is intended to offer India flexibility in aligning treaty commitments based on its economic relationship with the other country.
Issues with a Two-Model BIT Approach
- Categorizing countries as capital exporters or importers is difficult and changes over time.
- Fair and Equitable Treatment: BITs often include clauses that ensure investors receive just and non-discriminatory treatment.
- MFN and National Treatment: Many BITs include Most-Favoured-Nation (MFN) and National Treatment clauses to ensure that foreign investors are treated no less favorably than domestic or third-party investors.
- Promotes Economic Cooperation: BITs aim to foster trust and attract foreign direct investment (FDI) by creating a stable and predictable investment environment.
India’s Approach:
- India had signed many BITs in the 1990s and
- After facing multiple investor disputes, India adopted a new Model BIT in 2015, focusing more on protecting the government’s right to regulate and limiting investor rights.
- The Finance Minister’s proposal to reform the 2015 model seeks to make it more investor- friendly to attract foreign investment.
Conclusion:
India doesn’t need multiple BIT models, but a single, well- balanced one. It should offer fair protection to foreign investors while preserving India’s right to regulate for public welfare.
Mains Practice Question:
- India needs to strike a balance between ensuring investor security and maintaining its authority to regulate in public interest. Critically analyze the suggestion of using two separate Bilateral Investment Treaty (BIT) models, depending on whether India is a capital importer or exporter. (150 WORDS)
INDIA, RISING POWER DEMAND, AND THE HYDROGEN FACTOR
TOPIC: (GS3) ECONOMY: THE HINDU
India is preparing to meet its rising electricity demand and climate goals by integrating hydrogen and electricity storage into its energy transition. A shift in policy to include nuclear-produced hydrogen under “low-carbon hydrogen” is also being considered.
- India aims to become a developed country while achieving net-zero carbon emissions by 2070.
- This goal requires major changes in the way energy is produced, stored, and used, especially by shifting away from fossil fuels.
Policy Shift: Green to Low-Carbon Hydrogen:
- At present, only hydrogen made from solar/wind is called “green hydrogen.”
- Since nuclear-based hydrogen also has low emissions, a new classification of “low-carbon hydrogen” is suggested.
- This would allow nuclear-powered hydrogen to qualify for government support and incentives.
Need for Integrated Approach:
- Hydrogen production and electricity storage are currently treated separately.
- Merging them can lower costs and improve overall energy efficiency.
- Case studies prove that combined systems are more economical and sustainable.
Way Forward:
- Redefine “green hydrogen” as “low-carbon hydrogen” to include nuclear-based options.
- Promote joint development of energy storage and hydrogen systems to build a cost-effective and clean energy future.
HYDROGEN POWER
Hydrogen power is a clean energy source that uses hydrogen gas to generate electricity. When hydrogen is used in fuel cells or burned, it produces energy with zero carbon emissions, only releasing water as a byproduct. It can be made from water using electrolysis, especially using renewable energy (called green hydrogen), and making it a key solution for decarbonizing industries, transport, and power sectors.
CONCLUSION:
A sustainable energy future for India depends on smart integration of hydrogen and low-carbon electricity sources. Redefining hydrogen categories and encouraging joint systems can boost efficiency and support India’s net- zero goals.
Prelims Practice Question:
Q. Consider the following statements regarding Green Hydrogen:
- Green hydrogen is produced using renewable energy sources like solar and wind through the process of electrolysis.
- The only by-product of green hydrogen used in a fuel cell is water.
- Green hydrogen has higher carbon emissions compared to grey hydrogen.
- Green hydrogen is produced through electrolysis using renewable energy, such as solar or wind.
- In fuel cells, hydrogen combines with oxygen to produce electricity, and the only by-product is water.
- Green hydrogen has nearly zero carbon emissions, unlike grey hydrogen, which is produced from fossil fuels and emits CO₂.
Examine the necessity for a robust AI policy in India. How can the country strike a balance between fostering innovation and ensuring ethical standards, along with public accountability, in the application of AI technologies?
INDIA’S STRATEGY FOR REGULATING ARTIFICIAL INTELLIGENCE (AI)
TOPIC: (GS2) GOVERNANCE: THE HINDU
India is quickly adopting Artificial Intelligence (AI), but it lacks a clear national strategy or legal framework for its regulation, raising concerns about ethics, transparency, and accountability.
Global Trends in AI Regulation
- Over the past year, the global focus has shifted from just ethical and safety concerns to using AI for innovation and economic development.
- Only a few countries — like the EU, China, U.S., Canada, South Korea, and Peru — have official AI regulations.
- Countries such as Japan, U.K., Brazil, and Pakistan have proposed AI-related laws but haven’t passed them yet.
- Around 85 nations, including the African Union, have published national AI strategy papers with goals, plans, and ethical principles.
India’s Current AI Approach
- India doesn’t yet have an official AI policy or law.
- The IndiaAI Mission is the main initiative, aiming to develop a responsible and inclusive AI ecosystem.
- A 2018 NITI Aayog report proposed a national AI plan, but it was never formally adopted or funded.
- The IndiaAI strategy has seven core pillars, including research, talent, and responsible AI use.
- An expert group is working on AI governance proposals, but the framework is yet to be finalised.
Strengths and Weaknesses in India’s Approach
- Positive side: India’s flexible system can adjust to rapid technological or global shifts.
- Drawback: The absence of a clear national policy leads to scattered efforts without long-term direction.
- Implementation often depends on specific departments or individuals rather than a national roadmap.
Why Safeguards Are Needed
- Growing use of AI in public services like education and healthcare may lead to bias, exclusion, or data misuse.
- Presently, India’s AI rules are mostly voluntary and lack clarity.
- The public is largely unaware of how AI systems are designed or how they affect them.
- Misuse of AI-generated content has already triggered social disturbances, highlighting the urgency of regulation.
Learning from International Models
- EU and China use a centralised cross-sector regulatory model.
- The U.S. prefers sector-specific rules.
- India’s DPDP Act, 2023 can serve as a base for cross-sector AI regulation.
- India can adopt a hybrid model combining global best practices.
Way Forward
- A formal AI policy is needed as the first step.
- It should cover: ethical use, legal frameworks, implementation bodies, and public awareness.
- Encouraging public debate and testing systems will improve accountability and trust.
Conclusion:
A balanced and forward-looking AI policy will ensure that India leverages the benefits of AI while protecting its citizens. Public engagement and clear laws are key to responsible AI growth.
INDIA’S PUSH FOR EARLY HARVEST TRADE PACT WITH THE EUROPEAN UNION
TOPIC: (GS2) INTERNATIONAL RELATIONS: INDIAN EXPRESS
India is working to finalize an early harvest trade agreement with the European Union to unlock short-term trade benefits. This move is part of India’s broader plan to diversify its trade partners amid global trade challenges.
- With increasing global trade uncertainties, India is aiming to strengthen its international trade partnerships.
- As full Free Trade Agreements (FTAs) take time, India is opting for early harvest deals—limited but focused trade agreements that deliver faster benefits.
India-EU Early Harvest Deal: A Strategic Move
- India and the EU are discussing an early harvest agreement that would lower tariffs on selected important goods.
- The aim is to offer quick gains to businesses and consumers without waiting for a full FTA.
- This step is seen as a practical way to build momentum in trade talks.
India’s Phased Trade Negotiation Strategy
- The Indian government is prioritizing a step-by-step trade negotiation model.
- Officials describe this as a “first things first” approach—focusing on areas of mutual agreement before tackling more complex issues.
- A similar strategy is also being pursued with the United States.
Progress and Stumbling Blocks in EU-India FTA Talks
- Since July 2022, India and the EU have held ten negotiation rounds.
- There has been progress in mechanisms like dispute resolution.
- However, challenges remain, especially on rules of origin and the EU’s demand for more access in certain markets.
Key Sectors Involved
- The sectors being discussed include:
- Processed food items
- Pharmaceuticals
- Textiles and garments
- Chemicals and fertilizers
- Automobile parts
- The EU is especially pushing for better access in automobiles and medical devices, which is slowing down final decisions.
Conclusion:
India’s early harvest deal with the EU reflects a smart and flexible approach to international trade. By securing early gains, India aims to build trust and pave the way for a comprehensive FTA in the future.
CENTRAL BUREAU OF INVESTIGATION (CBI)
TOPIC: (GS2) INDIAN POLITY: THE HINDU
The Central Bureau of Investigation (CBI) has recently apprehended four key individuals involved in a “digital arrest” fraud as part of its nationwide Operation Chakra V. This highlights the growing concerns over cyber-enabled financial crimes and the need for stronger regulatory measures.
Overview of Operation Chakra V
- Operation Chakra V aims to combat cyber-enabled financial crimes and dismantle organized cybercrime syndicates that exploit digital platforms for illegal activities.
- The operation targets crimes such as data theft, online scams, and “digital arrest” frauds, where victims are extorted under psychological pressure.
Key Components of the Operation
- Coordination and Arrests: Operation Chakra V includes coordinated actions by the CBI, involving searches, arrests, and the seizure of digital evidence from the suspects.
- Geographical Reach: The operation spans across India, targeting cybercrime networks operating from different locations.
- Collaboration with State Police: To strengthen enforcement, the CBI works in collaboration with state police forces, leveraging advanced investigative methods.
- Public Awareness: One of the core aspects of the operation is educating the public about the risks of cybercrime and encouraging them to report frauds through cyber helplines.
Focus on “Digital Arrest” Fraud
- Definition: In this type of fraud, criminals impersonate officials to create false situations of arrest, extorting money from victims under duress.
- Psychological Pressure: The fraudsters use psychological tactics to coerce individuals into making payments, increasing the complexity of the crime.
CBI (Central Bureau of Investigation)
The CBI was established in 1963 by a notification of the Ministry of Home Affairs, Government of India, initially as the Special Police Establishment (SPE).
- Function: CBI is the premier investigating agency in India, responsible for investigating serious crimes like corruption, financial frauds, and major criminal cases (including cybercrimes and terrorism).
- Autonomy: While CBI functions under the Department of Personnel and Training (DoPT), it is often perceived as needing greater autonomy, especially when investigating high-profile cases involving politicians and public servants.
Key Functions of CBI
- Investigative Authority: CBI investigates cases referred to it by the government, and it can also take up cases on its own.
- Specialized Branches: The CBI has several divisions such as the Anti-Corruption Branch (ACB), Economic Offenses Wing (EOW), and Special Crime Branch (SCB) for investigating specific types of crimes.
- Coordination with State Police: CBI works in coordination with state police for effective law enforcement and investigation of crimes spanning multiple states.
Constitutional and Legal Basis
- Article 73: Extent of executive power of the Union – Article 73 allows the Union to legislate and take executive actions in areas under the Union list. CBI’s powers, especially related to interstate crimes, fall under this provision.
- Article 256: Obligation of States and Union – This article directs state governments to assist the Union government in matters related to law and order, which includes providing support to agencies like the CBI.
- The Delhi Special Police Establishment (DSPE) Act, 1946: Initially, the DSPE Act was enacted to investigate corruption in the central government. CBI now operates under this Act.
The Prevention of Corruption Act, 1988: This act gives CBI the authority to investigate cases of corruption among public officials.
Operation Chakra V reflects the growing urgency to tackle cybercrime in India. By targeting major fraud networks and raising public awareness, the operation serves as a critical step towards improving cybersecurity and protecting individuals from digital threats.
CHEETAH RELOCATION FROM KUNO TO GANDHI SAGAR
TOPIC: (GS3) ENVIRONMENT: THE HINDU
The Cheetah Project Steering Committee has approved relocating some cheetahs from Kuno National Park to Gandhi Sagar Wildlife Sanctuary in Madhya Pradesh as part of the ongoing efforts to establish a stable cheetah population.
Cheetah Reintroduction in India
- Cheetahs were declared extinct in India in 1952. To restore ecological balance and reintroduce these apex predators, Project Cheetah was launched in 2022.
- Initially, 20 cheetahs were translocated to Kuno National Park from Namibia and South Africa.
Relocation Plan:
- The relocation to Gandhi Sagar aims to create a larger cheetah meta-population across Madhya Pradesh and Rajasthan, with a target of 60-70 individuals.
- The relocation involves cheetahs either from the wild or enclosures at Kuno, with Gandhi Sagar’s prey base (including chinkara, nilgai, and chital) being sufficient to support them.
Key Features of Cheetahs
- Cheetahs are the fastest land animals, capable of reaching speeds up to 120 km/h, making them exceptional hunters.
- They communicate through chirps, barks, and use markings like urine sprays to mark territories.
- Females mature by 20–24 months and give birth to 3–5 cubs with a gestation period of 90–95 days.
Protection Status
- Cheetahs are listed as Vulnerable on the IUCN Red List and are protected under Schedule II of the Wildlife (Protection) Act, 1972.
- They are also listed in CITES Appendix I for protection against international trade.
Conclusion
The relocation of cheetahs to Gandhi Sagar is crucial for building a self-sustaining population and improving biodiversity in India’s grassland ecosystems.
REPO RATE CUT BY RBI
TOPIC: (GS3) ECONOMY: THE HINDU
The Reserve Bank of India (RBI) recently reduced the repo rate by 25 basis points to 6%, a move aimed at supporting economic growth amidst global challenges.
What is Repo Rate?
- Definition: The repo rate is the interest rate at which the RBI lends short-term funds to commercial banks, secured by government securities.
- Purpose: It is a key tool for the RBI to manage liquidity, control inflation, and influence economic activity by regulating the money supply in the economy.
- Impact on Banks: When the RBI changes the repo rate, it affects borrowing costs for commercial banks, thereby influencing the rates at which they lend to customers.
Impact of the Repo Rate Cut
- Lower Borrowing Costs: Reduced borrowing costs for commercial banks allow them to offer loans at lower interest rates, making credit more accessible to consumers and businesses.
- Impact on Fixed Deposits: Banks generally lower the interest rates on fixed deposits (FDs) after a repo rate cut, reducing returns on new FDs. However, existing FDs remain unaffected until maturity.
- Enhanced Credit Flow: The lower interest rates encourage borrowing, thus stimulating both business investments and consumer spending, which helps boost economic activity.
- Growth in Key Sectors: Sectors such as real estate and infrastructure are likely to benefit from lower financing costs, leading to increased activity in these areas.
- Global Economic Context: The RBI’s decision also aims to safeguard the Indian economy against global uncertainties, such as potential trade disruptions due to tariffs.
Conclusion
The RBI’s repo rate cut is a strategic move to lower borrowing costs, encourage credit flow, and support economic growth, especially in the face of global economic challenges.