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03-February-2025-Daily-Current-Affairs

February 3 @ 7:00 am - 11:30 pm

UNION BUDGET 2024: A CLOSER LOOK AT POLICY ANNOUNCEMENTS AND CHALLENGES

TOPIC: (GS3) ECONOMY: THE HINDU

The Union Budget 2024, presented by Finance Minister Nirmala Sitharaman, outlines a roadmap for economic growth amid pressing macroeconomic challenges. While it includes key policy measures in taxation, manufacturing, agriculture, and infrastructure, deeper analysis is needed to assess its long-term effectiveness.

Concerns Over Fiscal Targets

  • The Budget aims to bring the fiscal deficit down to 4.4% of GDP by FY26.
  • Achieving this requires an 11.2% increase in tax revenues and a 14.4% rise in income tax collection, which seems ambitious given economic uncertainties.
  • A second asset monetization plan (2025-30) has been announced, but the poor performance of the previous plan raises doubts.
  • The government plans ₹11.54 lakh crore in market borrowings, which may crowd out private investment, affecting credit availability.
  • Success depends on higher tax efficiency and realistic revenue generation strategies.

Impact of Tax Reforms

  • Personal income tax exemptions up to ₹12 lakh will reduce tax burdens for middle-income groups.
  • While boosting disposable income, these cuts may lead to a revenue loss of ₹1 lakh crore, limiting public spending.
  • Household savings have declined to 18.4% of GDP (Economic Survey 2024-25), raising concerns over long-term financial sustainability.
  • A balance between tax relief and developmental funding is essential for sustained growth.

Manufacturing Sector Boost

  • India aims to strengthen its manufacturing base, currently contributing only 17% of GDP.
  • Production-Linked Incentives (PLIs) have shown limited success, mainly in the electronics sector.
  • The National Manufacturing Mission proposes credit access for MSMEs, business-friendly regulations, and skill development initiatives.
  • MSME investment limits have been increased by 2.5 times, while turnover thresholds have doubled.
  • However, key issues remain, such as regulatory inefficiencies, inadequate infrastructure, and weak R&D investment (0.64% of GDP).

Gaps in Agricultural Reforms

  • Prime Minister Dhan-Dhaanya Krishi Yojana and the National Mission on High-Yielding Seeds aim to improve agricultural productivity.
  • The Kisan Credit Card (KCC) loan limit has been raised from ₹3 lakh to ₹5 lakh, providing farmers with better financial support.
  • However, challenges like price instability and lack of market access persist.
  • Absence of strong policies for agricultural exports, especially in millets and organic farming, is a missed opportunity.

External Sector and Trade

  • Services exports, especially IT and business outsourcing, are growing at 10.5% CAGR, but trade diversification is lacking.
  • Bharat Trade Net (BTN) and export credit support for MSMEs are positive steps, but they lack scale and funding.
  • The impact of rupee depreciation and declining forex reserves needs a comprehensive export strategy.
  • More focus on value-added sectors like pharmaceuticals, renewable energy, and high-value agriculture would improve global competitiveness.

Climate and Clean Energy Commitments

  • The Budget prioritizes lithium-ion battery recycling, critical mineral exemptions, and domestic solar and battery production.
  • However, investments in grid modernization, industrial decarbonization, and energy storage remain insufficient.
  • A stronger financial push is needed to ensure a smooth transition to a low-carbon economy.

Conclusion

The Union Budget 2024 sets a clear vision for economic growth but faces significant challenges in implementation. The balance between tax cuts and revenue generation, investment in manufacturing and innovation, and sustainable fiscal policies will determine its success. Effective execution and mid-course corrections will be key to realizing its full potential.

Prelims Question:

  1. With reference to the Annual Financial Statement (AFS) in India, consider the following statements:
  1. The Annual Financial Statement is presented under Article 112 of the Indian Constitution.
  2. It contains details of the estimated receipts and expenditures of the government for the next financial year.
  3. It is also referred to as the Economic Survey of India.

Which of the statements given above is/are correct?

  1. 1 and 2 only
  2. 2 and 3 only
  3. 1 and 3 only
  4. 1, 2, and 3

Answer: A

Explanation:

  • Article 112 of the Indian Constitution mandates the presentation of the Annual Financial Statement (AFS) in Parliament.
  • The AFS includes the estimated receipts and expenditures of the central government for the upcoming financial year.
  • The AFS is not the same as the Economic Survey. The Economic Survey is a separate document that reviews the country’s economic performance and is presented before the Budget.

FOSSIL FUEL SUBSIDIES: SCALE AND IMPACT

TOPIC: (GS3) ECONOMY: THE HINDU

Fossil fuel subsidies reduce the financial burden on consumers and producers but also slow the transition to clean energy. Estimates of these subsidies vary widely, from less than $1 trillion to $7 trillion, depending on how they are defined.

Types of Fossil Fuel Subsidies

Explicit Subsidies

  • Production Subsidies: Funds given to fossil fuel companies to lower extraction and refining costs.
  • Consumption Subsidies: Financial aid allowing consumers to buy fuel at lower prices.
  • In 2022, explicit subsidies amounted to approximately $1.5 trillion, which equals the GDP of countries like Russia or Australia.
  • About 80% of these went to consumers, while 20% supported production.
  • The rise in subsidies in 2022 was due to the energy price surge after Russia’s invasion of Ukraine.

Implicit Subsidies

  • These are indirect costs society bears due to fossil fuel use.
  • Environmental Costs: Damage from climate change and air pollution.
  • Health Costs: Medical expenses due to respiratory diseases caused by pollution.
  • Infrastructure Costs: Wear and tear on roads and other transport systems.
  • Implicit subsidies account for about $7 trillion, including 30% each for climate change and air pollution, and 17% for road use impacts.

Regional Differences in Subsidies

  • Countries vary significantly in the level of fossil fuel subsidies.
  • Major oil-producing nations like Saudi Arabia, Turkmenistan, Libya, and Algeria provided over $500 per person in subsidies.
  • Some of these subsidies accounted for more than 10% of their GDP.
  • In contrast, most European, American, and East Asian nations provided under $100 per person.
  • South Asia and Africa had even lower subsidies, often below $20 per person.
  • India reduced its fossil fuel subsidies from $9 per person in 2015 to $3 per person in 2021.

Addressing the Subsidy Problem

Reducing Direct Support

  • Phasing out production and consumption subsidies.
  • Redirecting funds to renewable energy alternatives.

Implementing Taxes and Charges

  • Introducing pollution and carbon taxes.
  • Using road taxes and congestion pricing to account for external costs.

Encouraging Clean Energy Adoption

  • Investing in renewable energy and infrastructure.
  • Promoting incentives for energy-efficient technologies.

Conclusion

While fossil fuel subsidies provide short-term relief, they create long-term environmental and economic burdens. A shift toward cleaner energy sources, alongside better tax policies, can help mitigate these issues.

LIVE-IN RELATIONSHIPS IN UTTARAKHAND’S UNIFORM CIVIL CODE

TOPIC: (GS2) INDIAN POLITY: THE HINDU

The Uttarakhand government has introduced new rules under its Uniform Civil Code (UCC), making it mandatory to register live-in relationships. These regulations, effective from January 27, 2025, apply to both residents of Uttarakhand and individuals from other states, raising concerns over privacy and legal obligations.

Key Provisions of the UCC on Live-in Relationships

Mandatory Registration

  • Live-in relationships must be registered at both initiation and termination.
  • Registration is applicable to all couples, even those from outside Uttarakhand.
  • Extensive documentation is required for the process.

Registration Process

  • Only unmarried, heterosexual couples can register.
  • Registration can be done online or offline.
  • Offline applications require a 16-page form along with supporting documents.
  • Required documents include photographs, PAN, Aadhaar linked to a phone number, and proof of residence in Uttarakhand.

Parental Notification

  • If a partner is aged between 18 and 21, their parents or legal guardians must be notified.
  • The registrar is responsible for informing parents of both registration and termination of the relationship.

Relationship History Disclosure

  • Couples must declare past relationships, including previous live-in partnerships.
  • Relationship status (single, married, divorced, separated, widowed) must be disclosed.
  • Relationships falling under “prohibited degrees” as per the Hindu Marriage Act require approval from a religious or community leader.

Housing and Landlord Obligations

  • Proof of shared accommodation, such as electricity or water bills, is required.
  • If renting, the landlord’s name, contact details, and a copy of the rent agreement must be submitted.
  • Landlords must ensure couples possess a registration certificate before leasing property.
  • Failure to comply attracts penalties.

Penalties for Non-Compliance

  • Failure to register within a month may lead to civil and criminal penalties.
  • Possible punishment includes:
    • Up to three months of imprisonment.
    • A fine of up to ₹10,000.
    • Both imprisonment and a fine in some cases.
  • Providing false information or concealing details carries stricter penalties (up to ₹25,000 fine and three months’ imprisonment).
  • False complaints also attract fines and increased penalties for repeat offenders.

Concerns and Criticisms

  • Experts argue that mandatory registration violates the right to privacy under Article 21 of the Constitution.
  • Critics claim that the regulations promote social surveillance, especially affecting interfaith and inter-caste couples.
  • There are no legal safeguards against third-party data leaks, posing risks to individuals’ safety and privacy.
  • The rules may disproportionately impact vulnerable groups.

Conclusion

While the Uttarakhand UCC aims to regulate live-in relationships, concerns over privacy, social implications, and legal consequences have sparked debates. The impact of these laws on personal freedoms and social structures remains to be seen.

Practice Question:

With reference to the Uniform Civil Code (UCC) in India, consider the following statements:

  1. The Uniform Civil Code is explicitly mentioned in the Fundamental Rights of the Indian Constitution.
  2. The Directive Principles of State Policy (DPSP) recommend the implementation of the UCC in India.
  3. Goa is the only Indian state that follows a uniform civil law for all its citizens.

Which of the statements given above is/are correct?

  1. 1 and 2 only
  2. 2 and 3 only
  3. 1 and 3 only
  4. 1, 2, and 3

Answer: B

Explanation:

  • The UCC is not part of the Fundamental Rights but is mentioned under Article 44 in the Directive Principles of State Policy (DPSP).
  • Article 44 of the Indian Constitution states that the State shall endeavour to secure a Uniform Civil Code for all citizens.
  • Goa is the only Indian state that follows a common civil code through the Goa Civil Code, which applies uniformly to all its residents.

AI-DRIVEN GENETIC TESTING

TOPIC: (GS3) SCIENCE AND TECHNOLOGY: THE HINDU

Advancements in Artificial Intelligence (AI) have revolutionized genetic testing, enabling faster analysis of DNA sequences. However, this progress comes with challenges such as data security risks, ethical concerns, and limitations in genetic predictions.

Impact of AI on Genomics

  • AI has significantly accelerated the processing of genetic data, increasing the volume of information being analysed.
  • Machine learning techniques have helped in identifying genetic sequences previously overlooked.
  • Researchers at Johns Hopkins University found new links between so-called “junk DNA” and cancerous tumours, improving diagnostics and treatment strategies.
  • Startups like Gene Box use AI algorithms to predict genetic predispositions, analyse gene-environment interactions, and offer personalized health recommendations.
  • Continuous updates based on scientific studies ensure AI models provide accurate and up-to-date genetic insights.

Challenges and Limitations

  • Genetic predictions are complex and not absolute; genes contribute only about 30% to outcomes like intelligence and success.
  • Some genetic variations fall into the category of “variants of uncertain significance,” making their impact unclear.
  • Certain conditions, like Alzheimer’s, involve multiple genetic and environmental factors, making predictions inconclusive.
  • Unanticipated findings in genetic tests, such as risks for mental health disorders, pose ethical dilemmas.
  • Family members might need to be tested to validate some genetic results, increasing privacy concerns.

Ethical and Privacy Risks

  • Genetic testing can reveal sensitive health information, raising concerns about misuse.
  • Ethical guidelines are crucial to ensuring responsible reporting of genetic predispositions without causing unnecessary fear.
  • Predicting conditions like depression or heart disease requires careful handling to avoid misinterpretation.
  • External factors, such as diet, lifestyle, and environment, play a crucial role in health outcomes beyond genetic makeup.

Data Security Concerns

  • Companies handling genetic data face significant risks of breaches and unauthorized access.
  • A 2023 data breach at 23andMe exposed personal data of nearly 7 million users, raising alarms about genetic data security.
  • Unlike healthcare providers, many genetic testing firms do not fall under strict data protection regulations like HIPAA.
  • Users often cannot withdraw their genetic data once analysed, increasing risks if companies change ownership or shut down.

Conclusion

AI-driven genetic testing offers remarkable insights but also poses challenges related to ethical concerns, accuracy, and data security. Strong regulations and responsible AI use are necessary to ensure genetic information remains safe and beneficial for healthcare advancements.

DECLINE IN EMPLOYMENT DAYS UNDER MGNREGS

TOPIC: (GS2) INDIAN POLITY: THE HINDU

The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) aims to provide 100 days of wage employment to rural households. However, the number of workdays per household has significantly declined in 2024-25, raising concerns about budgetary allocations and its impact on rural livelihoods.

Decline in Workdays and Employment

  • The average workdays per household under MGNREGS dropped from 52.08 days in 2023-24 to 44.62 days in 2024-25.
  • Total person-days of employment fell from 312.37 crore in 2023-24 to 239.67 crore in 2024-25.
  • A person-day refers to a single day of work provided to an individual registered under MGNREGS in a financial year.

Budgetary Constraints and Financial Deficit

  • The budget allocation remained stagnant at ₹86,000 crore, the same as the previous year.
  • As of February 1, 2025, the deficit stood at ₹9,860 crore, with pending wages of ₹6,948.55 crore as of January 25, 2025.
  • 20% of the budget is often used to clear past dues, effectively reducing the available funds for the next financial year.
  • The real allocation, when adjusted for inflation, is about ₹4,000 crore less than the previous year.
  • As a percentage of GDP, the allocation has declined to 0.24% in 2024-25 from 0.26% in 2023-24.

Consequences of Inadequate Budget Allocation

  • Delayed Wage Payments: Rural workers face financial distress due to massive wage payment delays.
  • Suppression of Work Demand: Limited funds result in fewer job opportunities, restricting employment options.
  • Denial of Right to Employment: The scheme is unable to meet the legal guarantee of 100 days of work per household.
  • Lower Asset Creation: Due to insufficient funds, quality infrastructure and rural asset creation suffer.
  • Weakening Rural Economy: Reduced spending capacity of rural workers negatively impacts the overall rural economy.

Political and Economic Implications

  • Critics argue that the government’s neglect of MGNREGS reflects an indifference to rural livelihoods.
  • Congress leader Jairam Ramesh highlighted that the wages under MGNREGS increased by only 7%, while inflation stood at around 5%, leading to wage stagnation.
  • The scheme is crucial for supporting drought-hit and economically weaker rural populations, making budgetary neglect a pressing issue.

Conclusion

The decline in workdays and stagnant budgetary allocation under MGNREGS has raised serious concerns about rural employment and financial security. Addressing wage payment delays and increasing budgetary support is crucial to uphold the scheme’s objective of providing guaranteed rural employment.

Practice Question:

  1. Which of the following statements about the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) is/are correct?
  1. MGNREGA guarantees 100 days of wage employment to every rural household whose adult members volunteer to do unskilled manual labour.
  2. It is applicable only to the rural population below the poverty line.
  3. Under MGNREGA, the central government bears the entire cost of wages for labourers employed under the scheme.
  4. MGNREGA is designed to address rural unemployment while also promoting sustainable development through eco-friendly projects.

Select the correct answer using the code below:

  1. 1 and 3 only
  2. 1, 3, and 4 only
  3. 1 and 4 only
  4. 1, 2, 3, and 4

Answer: B

Explanation:

  • MGNREGA guarantees 100 days of employment to rural households, provided that adult members are willing to do manual labour.
  • MGNREGA applies to all rural households, not just those below the poverty line.
  • the central government provides the full wages for unskilled labour under MGNREGA, while the state government provides the materials and administrative costs.
  • MGNREGA has provisions for promoting sustainable projects like water conservation, afforestation, and land development.

WORLD WETLANDS DAY AND THE DECLINE OF MIGRATORY BIRDS IN PUNJAB

TOPIC: (GS3) ENVIRONMENT: INDIAN EXPRESS

World Wetlands Day is observed annually on February 2 to highlight the importance of wetlands in maintaining ecological balance. Despite their significance, wetlands face various threats, including pollution, habitat destruction, and climate change, leading to a decline in migratory bird populations.

Importance of Wetlands

  • Wetlands are areas covered by water either permanently or seasonally, including marshes, lakes, and swamps.
  • They support biodiversity, providing habitats for migratory birds, fish, and plant species.
  • Act as carbon sinks, absorbing more carbon than they release, thus mitigating climate change.
  • Help in groundwater recharge, flood control, and water purification.
  • Support livelihoods such as fishing, agriculture, and tourism.

Ramsar Convention and Wetland Conservation

  • The Ramsar Convention was signed in 1971 in Ramsar, Iran, to protect wetlands globally.
  • India has designated 89 wetlands as Ramsar sites, ensuring their conservation and management.
  • Tamil Nadu has the highest number of Ramsar sites (20), while Punjab has six significant wetlands.

Major Wetlands in Punjab

  • Harike Wetland – Largest in North India, hosting migratory birds like Siberian cranes and bar-headed geese.
  • Kanjli Wetland – Located along the Kali Bein River, home to diverse fish species and turtles.
  • Ropar Wetland – Situated on the Sutlej River, crucial for biodiversity and water retention.
  • Nangal Wetland – Part of the Bhakra-Nangal reservoir, attracting over 40,000 migratory birds annually.
  • Beas Conservation Reserve – Habitat for Indus River dolphins, freshwater fish, and turtles.
  • Ranjit Sagar Wetland – Formed after the construction of Ranjit Sagar Dam, supporting otters and migratory birds.

Decline in Migratory Birds in Punjab

  • Bird census (2023-24) by Punjab’s Department of Forests and Wildlife recorded a 13.7% decline in bird populations.
  • Numbers fell from 85,882 (2022-23) to 74,129 (2023-24), following a 10.47% decline the previous year.
  • Kanjli Wetland saw the most drastic drop, with bird numbers reducing by 49.49% since 2021-22.
  • Despite the decline, the number of bird species increased from 107 (2022-23) to 114 (2023-24).

Threats to Wetlands

  • Industrial Pollution – Waste discharge from factories near Harike, Ropar, and Kanjli contaminates water bodies.
  • Illegal Sand Mining – Destroys water retention capacity and disrupts aquatic life.
  • Agricultural Runoff – Pesticides and fertilizers seep into wetlands, harming wildlife.
  • Sewage Disposal – Polluted water from Budha Nallah reaches Harike Wetland, deteriorating its ecosystem.
  • Climate Change – Rising temperatures and erratic weather patterns affect wetland biodiversity.

Conservation Measures

  • Afforestation – Planting native trees to improve the wetland ecosystem.
  • Soil Conservation – Preventing erosion to maintain water quality.
  • Regulating Industrial Discharges – Strict monitoring to prevent pollution.
  • Banning Illegal Mining – Enforcing laws against unauthorized extraction of sand.
  • Public Awareness – Educating communities about the importance of wetlands and conservation efforts.

Conclusion

Wetlands play a crucial role in maintaining ecological balance and supporting biodiversity. However, unchecked pollution, habitat destruction, and climate change are leading to their degradation. Strengthening conservation efforts, enforcing environmental laws, and promoting sustainable practices are essential to protect these valuable ecosystems for future generations.

INDIA NEEDS A LAW TO PROTECT DOMESTIC WORKERS’ RIGHTS

TOPIC: (GS2) INDIAN POLITY: THE HINDU

Domestic workers in India face significant challenges due to the absence of legal protection. The Supreme Court’s recent directive to consider a national law for domestic workers is a crucial step toward ensuring their rights and dignity.

Need for a Law to Protect Domestic Workers

  • The Supreme Court, on January 29, 2025, directed the Union government to explore the feasibility of a separate legal framework for domestic workers.
  • It ordered the formation of an inter-ministerial committee to examine the need for legal protection, regulation, and benefits for domestic workers.
  • The Court highlighted their vulnerability due to exclusion from major labour laws such as the Minimum Wages Act and the Equal Remuneration Act.

Challenges Faced by Domestic Workers

  • Domestic work is a female-dominated sector, with a large portion of workers belonging to marginalized communities.
  • Wage rates and benefits vary significantly based on tasks and employment type.
  • Common issues include:
    • Low wages and absence of overtime pay.
    • Excessive workloads without additional compensation.
    • Job insecurity and lack of social security benefits.
  • Many employers do not recognize their homes as workplaces, making enforcement of labour rights difficult.

Societal Perception and Workplace Challenges

  • Domestic work is undervalued and considered a basic skill for women rather than professional employment.
  • Cases of harassment and mistreatment often go unreported.
  • Despite judicial interventions, there has been little progress in regulating the sector.
  • India has yet to ratify the ILO Convention 189, which protects domestic workers’ rights globally.

Need for Specific Legislation

  • Unlike previous labour laws, the new Code on Wages (2019) technically covers domestic workers but fails to address their unique challenges.
  • The sector has different forms of employment: part-time, full-time, live-in, and live-out arrangements, making regulation complex.
  • Proof of employment remains a major hurdle in ensuring fair wages and conditions.
  • Domestic worker unions advocate for mandatory employer registration to ensure legal recognition.

Way Forward

  • A national law should include:
    • Minimum wage and fair working conditions.
    • Employer registration and legal contracts.
    • Social security benefits such as health insurance and pensions.
  • Lessons can be drawn from state-level regulations in Kerala and Delhi.
  • The government must consult domestic workers’ unions while framing the law.

Conclusion

Although implementing a law will have challenges, it is essential for improving working conditions and shifting power dynamics. The Supreme Court’s directive provides a crucial opportunity to bring meaningful change in the sector.

UNION BUDGET 2025-26: IMPACT ON WOMEN’S WELFARE

TOPIC: (GS2) INDIAN ECONOMY: INDIAN EXPRESS

The Union Budget 2025-26 emphasizes women’s empowerment under the government’s “Nari Shakti” initiative, with an increased allocation in the Gender Budget Statement (GBS). However, despite higher funding, gaps in targeted implementation and transparency remain.

Gender Budget Statement (GBS)

  • Introduced in FY 2005-06, GBS reports allocations for women-centric schemes in the Union Budget.
  • It is not a separate budget for women but an accounting mechanism for existing schemes.
  • Classified into:
    • Part A: 100% funds allocated for women.
    • Part B: 30-99% allocation for women.
    • Part C: 1-29% allocation for women.

Trends in GBS Over the Years

  • In FY 2025-26, GBS allocation rose 37% to ₹4.49 lakh crore, making up 9% of total expenditure (up from 5% in FY 2019-20).
  • Part A funding remains stagnant, while Parts B and C show growth.
  • Increase in Part B and C may indicate greater gender mainstreaming or arbitrary classifications by ministries.

Key Allocations for Women-Centric Schemes

Jal Jeevan Mission (JJM)

  • Provides tap water connections to reduce the burden of fetching water, primarily on women.
  • Previously had 49% allocation for women, now reduced to 31%, signalling a weaker commitment to gender-focused implementation.

Pradhan Mantri Awaas Yojana–Grameen (PMAY-G)

  • Aims to provide pucca houses for rural poor, prioritizing women’s ownership.
  • Listed under Part A (100% for women) but only 23% of houses have been allotted to women, showing a gap in execution.

Mission Saksham Anganwadi & Poshan 2.0

  • Focuses on women’s health and nutrition.
  • Listed in both Part A and Part B, leading to confusion in allocation clarity.
  • PM Matru Vandana Yojana (PMMVY) funding is unclear after restructuring, reducing transparency.

National Rural Livelihoods Mission (NRLM)

  • Supports Self-Help Groups (SHGs) for women’s economic empowerment.
  • Upgraded from Part B to Part A in FY 2024-25, showing government prioritization.

Challenges & Way Forward

  • Lack of transparency in fund allocation and inconsistent reporting across ministries.
  • Need for regular gender audits to ensure actual benefits reach women.
  • Methodologies behind GBS should be publicly available for accountability.

Conclusion

While the budget reflects increased financial support for women’s welfare, implementation gaps and opaque reporting hinder actual progress. More transparent policies and targeted audits are essential to fulfil the government’s commitment to Nari Shakti.

Details

Date:
February 3
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7:00 am - 11:30 pm
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