Aspirants Times Magazine Vol5 - August 2009

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INDEX Editorial • Challenge is yours, take it ......................................................................................03 SECTION - 1: Articles • US-India Relationship ...........................................................................................04 • 35th G-8 Annual Summit .......................................................................................18 • Carbon Emissions Trading .....................................................................................34 • Economic Survey:2008-09 .....................................................................................45 • Hindi Article ( VÉ±É´ÉÉªÉÖ {É‡® ´ÉiÉÇxÉ ) ...............................................................................60 SECTION - 2: Hot Topics • Arihant Class Submarine ........................................................................................79 • Economy Special-Terminology and Concept .........................................................83 SECTION - 3: Current Affairs............................................................................101 SECTION -4: Sports.............................................................................................104 SECTION -5: Awards...........................................................................................106 SECTION - 6: IAS Mains, Model Paper cum Notes Part-2...........................111 Copyright © 2009 | WWW.UPSCPORTAL.COM 2

Challenge is yours, take it... You have chosen to crack IAS examination… No doubt, it is diffi t. It is d ffi l t w n cul i cu h e you begin preparation, then many more diffi ties in exam it is d ffi l t as a service. cul ; i cu First of all, you should take these diffi ties as a cha l lenge and if you det erm n d of cul i e becoming IAS, then be ready to face all challenges at every step of life. Make challenges your friend; it will help you to overcome from diffi ties . N w if y a g n to a cul o ou re oi g ppear IAS Mains-Exam this year, it is a big challenge. Take a fi step and go strai ght , d t rm on' think either side; surely you will fi d y n our d tin t io es a n. "UPSCPORTAL.COM" is always with you, but it cannot eradicate challenges; we can make you more capable, wise, knowledgeable and quicker to face the challenges. We feel that 'Aspirants Time' Magazine is going in the right direction to make you more capable to face challenges. In this fi v u e o "A pi rant T m s ", w a p ovi d n y fth ol m f s i e e re r i g ou suffi ent and im or tant m t erial for IA M i n E i n t io T re is a M del -cum ci p a S a s xam a n. he o - Study Notes for General Studies Second Paper. These are important notes for practice which are in detail and easy to understand. By reading these Notes, you will be able to answer those questions, which has not been asked directly in this model. You will fi dn the chapter Economy Special-Terminology and Concept, which is very useful for the examination point of view. Read it carefully and make the diffi t aspect o exam n - cul f i a tion, easy. Besides this, There are regular articles like 'US-India Relationship', '35th G-8 An- nual Summit', 'Carbon Emissions Trading', 'Economic Survey:2008-09', and 'Jalwayu Parivartan' (in Hindi). Under HOT-TOPICS, we have 'Arihant Class Submarine'. Last but not least regular columns - CURRENT AFFAIRS, SPORTS & AWARDS are also there. With this we wish All The Best; Enjoy the Challenges... Editor: R. K. Pandey Copyright © 2009 | WWW.UPSCPORTAL.COM 3

Section -1 (Article : US-India Relationship) US-India Relationship Hillary Clinton's Visit to India By: R. K. Pandey Hillary Clinton’s visit to India in july 2009, her ers in the global arms bazaar. Mrs Clinton also refi as S rst ecret ary o S at e, g f t ave p obabl y th b t r e es vealed that India had identifi tw sites w e re ed o h insight yet into how President Obama intends to American companies would be allowed to build carry forward that relationship, set to become one nuclear power stations. This was another lucra- of the most important and potentially trickiest tive arrangement for the US, one set up by Presi- among the major nations as the 21st century dent Bush who during his second term effectively progresses. After perhaps ended India’s status as an 50 years when the US all international nuclear pa- but ignored India it now riah by granting it access values the country as a to US civilian nuclear tech- trading partner of poten- nology, even though it has tially huge consequence not signed the Non-Prolif- (India is on course to be eration Treaty. among the world’s leading fie e v conom es w th n i i i So far, so positive. But the two decades), an Asian visit also highlighted a counterweight to the couple of all-important ar- might of China and a key eas climate change and ter- player in the fi a n t ght gai s rorism, no less where the Islamist extremism. It US and India have substan- showed. The mood music tial differences. The Indian for Mrs Clinton’s trip was Environment Minister Jairam Ramesh dismissed almost unrelentingly upbeat. She also revealed that out of hand US suggestions that India should ac- Prime Minister Manmohan Singh had accepted cept worldwide legally binding caps on the pro- an invitation to make a state visit to Washington duction of greenhouse gases. He did so with an in November,2009. More concretely, the US and eye to a possible successor to the Kyoto Protocol India inaugurated a strategic dialogue on issues being drawn up at the Copenhagen Climate Con- ranging from education to climate change, an on- ference in December and in front of a barrage of going conversation into which both governments TV cameras in a way that seemed calculated to hope to draw participants from commerce, set up an on-screen confrontation with Mrs academia and the arts. Clinton perhaps because the Indian Government has recently been criticised at home for making That may sound a little flf fy, b th U h s typi - u ut e S a concessions at a global forum on green issues. cally reserved this kind of exchange for major countries such as China. Extending it to India ac- It’s diffi t to see a sim l e w y a cul p a round th s e i s- i m knowledged the country’s rising role and grow- sions impasse. Today, the idea of India a developing say on matters that directly affect the US such ing country with a vast poor population effectively as the progress of the Doha Trade Round. More setting limits on industrial growth is about as cred- concretely still, the US announced an agreement ible as a US President making car-pooling manda- that will allow it to monitor the use of military tory for all Americans. equipment it sells to India. The deal paves the way for billions of dollars' worth of weapons contracts She also found herself in the unenviable position as the latter emerges as one of the biggest spend- of having to attest to Pakistan’s sincerity in tack- Copyright © 2009 | WWW.UPSCPORTAL.COM 4

Section -1 (Article : US-India Relationship) ling Islamic extremism to an Indian audience. In both Governments to build on recent increased staying at the Taj, Mrs Clinton made it clear that coordination in counter-terrorism. Secretary she wished to express her solidarity with India. Clinton invited Home Minister Chidambaram to But US support of the Zardari regime in Islamabad visit Washington in the near future. External Af- was also pronounced and she appears likely to fairs Minister Krishna and Secretary Clinton also travel to Pakistan before long. It is hard to over- reaffi e d th i r com tm nt to early adopt io rm e mi e n state just how much distrust and rancour exists of a UN Comprehensive Convention against In- between India and Pakistan from that felt by or- ternational Terrorism which would strengthen the dinary men on the street to that betrayed by offi - framework for global cooperation. cials on both sides when they lament and ridicule their opposite numbers’ words and actions. Keep- Defence Cooperation: Noting the enhanced co- ing both countries’ friendship will be a testing task operation in defence under the Defence Co-op- for Mrs Clinton. For her to become a hero to In- eration Framework Agreement of 2005, External dia is not impossible but will take some doing. Affairs Minister and Secretary Clinton reiterated the commitment of both Governments to pursue India - US Joint Statement: External Affairs Min- mutually benefi al cooperat io i n th field of ci n e ister S.M. Krishna and Secretary of State Hillary defence. External Affairs Minister Krishna an- Clinton committed to building an enhanced In- nounced that both sides had reached agreement dia- U.S. strategic partnership that seeks to ad- on End Use Monitoring for U.S. defense articles. vance solutions to the defi i n c l lenges o tim . n g ha f e Seeking a World Without Nuclear Weapons: In- India and US agreed to strengthen the existing dia and the United States share a vision of a world bilateral relationships and mechanisms for coop- free of nuclear weapons. With this goal in sight, eration between the Government of Republic of Minister Krishna and Secretary Clinton agreed to India and the Government of the United States of move ahead in the Conference on Disarmament America, while leveraging the strong foundation towards a non-discriminatory, internationally and of economic and social linkages between our re- effectively verifi e Fi ssi le M t eri al C t -of f abl a u spective people, private sectors, and institutions. Treaty. India and the United States will also co- Recognizing the new heights achieved in the In- operate to prevent nuclear terrorism and address dia - U.S. relationship over the last two Indian the challenges of global nuclear proliferation. A and U.S. Administrations, they committed to pur- high-level bilateral dialogue will be established to suing a third and transformative phase of the re- enhance cooperation on these issues. lationship that will enhance global prosperity and stability in the 21st century. Minister Krishna and Civil Nuclear Cooperation: Building on the suc- Secretary Clinton will chair an “India-U.S. Stra- cess of the India –U.S. Civil Nuclear Initiative, on tegic Dialogue” that meets once annually in alter- July 21, India and the United States will begin nate capitals. This dialogue will focus on a wide consultations on reprocessing arrangements and range of bilateral, global, and regional issues of procedures, as provided in Article 6 (iii) of the 123 shared interest and common concern, continuing Agreement for Peaceful Nuclear Cooperation be- programmes currently under implementation and tween India and the United States. taking mutually benefi al in tiativ th t c p l e- ci i es a om ment Indian and U.S. development, security and Global Institutions: Secretary Clinton affi e d rm economic interests. that multilateral organizations and groupings should refl th w r ld of th 21s t cent u y in ect e o e r Advancing Common Security Interests: Recog- order to maintain long-term credibility, relevance nizing the shared common desire to increase mu- and effectiveness, and both Minister Krishna and tual security against the common threats posed Secretary Clinton expressed their interest in ex- by international terrorism, Minister Krishna and changing views on new confi at io o th U gur ns f e N Secretary Clinton reaffi e d th com tm nt o rm e mi e f Security Council, the G-8, and the G-20. Copyright © 2009 | WWW.UPSCPORTAL.COM 5

Section -1 (Article : US-India Relationship) Pursuing Sustainable Growth and Development: in the knowledge and innovation-based economies As members of the G-20, India and the United of the two countries, it was agreed that the agenda States have pledged to work together with other and the initiatives in the bilateral High Technol- major economies to foster a sustainable recovery ogy Cooperation Dialogue should continue, with from the global economic crisis through a com- the objective of facilitating smoother trade in high mitment to open trade and investment policies. technology between the two economies refl - ect Minister Krishna and Secretary Clinton reaffi e d rm ing the present strategic nature of the India-U.S. the commitment of both Governments to facili- relationship. It was also agreed that working tating a pathway forward on the WTO Doha groups would be formed to focus on new areas of Round. They pledged to co-operate to not only common interest in nano-technology, civil nuclear preserve the economic synergies between the two technology, civil aviation and licensing issues in countries that have grown over the years, but also defence, strategic and civil nuclear trade. to increase and diversify bilateral economic relations and expand trade and investment fl w . T o s he Energy Security, Environment and Climate two sides noted that negotiations for a Bilateral Change: Minister Krishna and Secretary Clinton Investment Treaty would be scheduled in New pledged to intensify collaboration on energy se- Delhi in August 2009. They resolved to harness curity and climate change. Efforts will focus on the ingenuity and entrepreneurship of the private increasing energy effi enc y, rene w bl e ene rgy, ci a sectors of both countries with a newly-confi ed gur and clean energy technologies through the India- CEO Forum that will meet later this year. U.S. Energy Dialogue and a Global Climate Change Dialogue. Both sides also agreed to launch a pro- Education: External Affairs Minister Krishna and cess of bilateral scientifi and technol o cal col - c gi Secretary of State Clinton affi e d th im ortance rm e p laboration to support the development, deploy- of expanding educational cooperation through ex- ment and transfer of transformative and innova- changes and institutional collaboration, and agreed tive technologies in areas of mutual interest in- on the need to expand the role of the private sec- cluding solar and other renewable energy, clean tor in strengthening this collaboration. coal and energy effi enc y, a o h r rel evant a ci nd t e r- eas. India and the U.S. affi e d th i r c mi tm nt rm e om e Space, Science and Technology and Innovation: to work together with other countries, including Recognizing the great potential in India-U.S. sci- through the Major Economies Forum, for posi- ence and technology collaboration, the two sides tive results in the UNFCCC Conference on Cli- have concluded a Science and Technology Endow- mate Change in Copenhagen in December 2009. ment Agreement, and signed a Technology Safe- Global Issues: The two sides noted the valuable guards Agreement that will permit the launch of engagement between both Governments on glo- civil or non-commercial satellites containing U.S. bal issues of common concern such as strength- components on Indian space launch vehicles. Both ening democracy and capacity building in demo- sides welcomed India’s participation in the cratic institutions as co-founders of the UN De- FutureGen Project for the construction of the fi rst mocracy Fund. The two sides agreed to develop a commercial scale fully integrated carbon capture Women’s Empowerment Forum (WEF) to ex- and sequestration project and India’s participation change lessons and best practices on women’s em- in the Integrated Ocean Development Project, an powerment and development and consider ways international endeavour for enhancing the under- to empower women in the region and beyond. standing of Earth and Ocean dynamics and addressing the challenges of climate change. High Technology Cooperation: Noting the high potential that exists due to the complementarities Copyright © 2009 | WWW.UPSCPORTAL.COM 6

Section -1 (Article : US-India Relationship) India – United States Relations develop their resources is through the Commu- nist system." From 1961 to 1963 there was a prom- Despite being one of ise to help set up a large steel mill in Bokaro that the pioneers and was withdrawn by the U.S. The 1965 and 1971 founding members of Indo-Pakistan wars did not help their relations. the Non Aligned During the Cold War, the US asked for Pakistan's Movement, India de- help because India was seen to lean towards the veloped a closer rela- Soviet Union. Later, when India would not agree tionship with the So- to support the anti-Soviet operation in Afghani- viet Union during stan, it was left with few allies. Not until 1997 the cold war. India's strategic and military rela- was there any effort to improve relations with the tions with Moscow and strong socialist policies United States. had an adverse impact on its relations with the United States. After the collapse of Soviet Union, Soon after Atal Bihari Vajpayee became Indian India began to review its foreign policy in a uni- Prime Minister, he authorized a nuclear weapons polar world following which, it took steps to de- test in Pokhran, which got the immediate atten- velop closer ties with the European Union and the tion of the US. The Clinton administration and United States. Today, India and the U.S. share an Vajpayee exchanged representatives to help build extensive cultural, strategic, military and economic relations. In March 2000, President Bill Clinton relationship. During the tenure of the Clinton and visited India. He had bilateral and economic dis- Bush administration, relations between India and cussions with Prime Minster Atal Bihari Vajpayee. the United States blossomed primarily over com- Over the course of improved diplomatic relations mon concerns regarding growing Islamic extrem- with the Bush administration, India has agreed to ism, energy security and climate change. allow close international monitoring of its nuclear weapons development while refusing to give up According to some foreign policy experts, there its current nuclear arsenal. India and the US have was a slight downturn in India-U.S. relations fol- also greatly enhanced their economic ties. lowing the appointment of Barack Obama as the U.S. President in 2009. This was primarily due to During the 9/11 terrorist attacks on the U.S., Presi- Obama administration’s desire to increase relations dent George W. Bush chose India as the country with China, and Barack Obama's protectionist to control and police the Indian Ocean sea-lanes views on dealing with the economic crisis. How- from the Suez to Singapore. The tsunami that oc- ever, the leaders of the two countries have repeat- curred in December 2004 saw the U.S. and Indian edly dismissed these concerns. navies to work together in search and rescue operations and to reconstruct the damaged lives and After Indian independence until the end of the land. An Open Skies Agreement was made in April cold war, the relationship between the two na- 2005. This helped enhance trade, tourism, and tions has often been thorny. Dwight Eisenhower business by the increased number of ﬂ s. A r ight i was the ﬁ U P es id rst S r ent to v sit In a in 1 i di 959. India purchased 68 US Boeing aircraft, which cost During John F. Kennedy’s period as President, he $8 billion.Former U.S. Secretary of Defense saw India as a strategic partner against the rise of Donald Rumsfeld and U.S. Secretary of State communist China. He said "Chinese Communists Condoleezza Rice have made recent visits to In- have been moving ahead the last 10 years. India dia as well. After Hurricane Katrina, India donated has been making some progress, but if India does $5 million to the American Red Cross and sent 2 not succeed with her 450 million people, if she plane loads of relief supplies and materials to help. can't make freedom work, then people around the And on March 1,2006, President Bush made an- world are going to determine, particularly in the other diplomatic visit to expand relations between underdeveloped world, that the only way they can India and the United States. Copyright © 2009 | WWW.UPSCPORTAL.COM 7

Section -1 (Article : US-India Relationship) nuclear tests in May 1998. The nonproliferation Military Relations dialogue initiated after the 1998 nuclear tests has bridged many of the gaps in understanding be- The U.S.-India defense relationship derives from tween the countries. In a meeting between Presi- a common belief in freedom, democracy, and the dent Bush and Prime Minister Vajpayee in No- rule of law, and seeks to advance shared security vember 2001, the two leaders expressed a strong interests. These interests include maintaining se- interest in transforming the U.S.-India bilateral curity and stability, defeating terrorism and vio- relationship. High-level meetings and concrete lent religious extremism, preventing the spread cooperation between the two countries increased of weapons of mass destruction and associated ma- during 2002 and 2003. terials, data, and technologies and protecting the free fl w o c me rce v a land, a r a sea lane s . o f om i i nd In January 2004, the U.S. and India launched the In recent years India has conducted joint military Next Steps in Strategic Partnership (NSSP), which exercises with the U.S. in the Indian Ocean. De- was both a milestone in the transformation of the spite this the Indian government sees the sole U.S. bilateral relationship and a blueprint for its fur- base in the Indian Ocean, Diego Garcia, and the ther progress.In July 2005, President Bush hosted permanent presence of the U.S. military there, as Prime Minister Singh in Washington, DC. The two a potential escalation point in a future war, espe- leaders announced the successful completion of cially because of the current U.S. operations in the NSSP, as well as other agreements which fur- Iraq and Afghanistan.Recognizing India as a key ther enhance cooperation in the areas of civil to strategic U.S. interests, the United States has nuclear, civil space, and high-technology com- sought to strengthen its relationship with India. merce. Other initiatives announced at this meeting include: an U.S.-India Economic Dialogue, The two countries are the world's largest democ- Fight Against HIV/AIDS, Disaster Relief, Tech- racies, both committed to political freedom pro- nology Cooperation, Democracy Initiative, an tected by representative government. India is also Agriculture Knowledge Initiative, a Trade Policy moving gradually toward greater economic free- Forum, Energy Dialogue and CEO Forum. Presi- dom. The U.S. and India have a common interest dent Bush made a reciprocal visit to India in March in the free fl w of com rce and res our ces , in o me - 2006, during which the progress of these initia- cluding through the vital sea lanes of the Indian tives were reviewed, and new initiatives were Ocean. They also share an interest in fi in ter- ght g launched. rorism and in creating a strategically stable Asia. In December 2006, Congress passed the historic There were some differences, however, including Henry J. Hyde United States-India Peaceful over India's nuclear weapons programs and the Atomic Cooperation Act, which allows direct ci- pace of India's economic reforms. In the past, these vilian nuclear commerce with India for the fi rst concerns may have dominated U.S. thinking about time in 30 years. U.S. policy had opposed nuclear India, but today the U.S. views India as a growing cooperation with India because the country had world power with which it shares common stra- developed nuclear weapons in contravention of tegic interests. A strong partnership between the international conventions and never signed the two countries will continue to address differences Nuclear Non-Proliferation Treaty. The legislation and shape a dynamic and collaborative future. clears the way for India to buy U.S. nuclear reactors and fuel for civilian use. In July 2007, the In late September 2001, President Bush lifted sanc- United States and India reached a historic mile- tions imposed under the terms of the 1994 Nuclear stone in their strategic partnership by completing Proliferation Prevention Act following India's negotiations on the bilateral agreement for peace- Copyright © 2009 | WWW.UPSCPORTAL.COM 8

Section -1 (Article : US-India Relationship) ful nuclear cooperation, also known as the "123 telecommunications, ports, roads, petroleum ex- agreement." This agreement, signed by Secretary ploration/processing, and mining industries. of State Rice and External Affairs Minister Mukherjee on October 10, 2008, governs civil In july 2005, President George W. Bush and In- nuclear trade between the two countries and opens dian Prime Minister Dr. Manmohan Singh cre- the door for American and Indian fi s to par- rm ated a new program called the Trade Policy Fo- ticipate in each other's civil nuclear energy sec- rum. It is run by a representative from each na- tor. The U.S. and India seek to elevate the strate- tion. The United States Trade Representative is gic partnership further to include cooperation in Rob Portman and the Indian Commerce Secre- counter-terrorism, defense cooperation, educa- tary is minister of commerce Kamal Nath. The goal tion, and joint democracy promotion. of the program is to increase bilateral trade which is a two-way trade deal and the fl w of in t- o ves Economic Relations ments. The United States is also one of India's largest di- There are fi e m i n sub- di v sio of th Tr ade v a i ns e rect investors. From the year 1991 to 2004, the Policy Forum which include: Agricultural trade stock of FDI infl w h s in reased from U D $ 3 o a c S 11. group- This group has three main objectives: million to $344.4 million, totaling $4.13 billion. agreeing on terms that will allow India to export This is a compound rate increase of 57.5% annu- mangoes to the United States, permitting India's ally. Indian direct investments abroad were started APEDA (Agricultural and Process Food Products in 1992. Indian corporations and registered part- Export Development Authority) to certify Indian nership fi s are al lo e d to in t in b in s ses rm w ves us e products to the standards of the USDA, and ex- up to 100% of their net worth. India's largest out- ecuting regulation procedures for approving ed- going investments are manufacturing, which ac- ible wax on fruit. Tariff and Non-Tariff Barriers count for 54.8% of the country's foreign invest- group- Goals of the group include: agreeing that ments. The second largest are non-fi a nc i al ser- n insecticides that are manufactures by United States vices (software development), which accounts for companies can be sold throughout India. India had 35.4% of investments. agreed to cut special regulations on trading car- bonated drinks, many medicinal drugs, and low- Trade Relations: The United States is India's larg- ering regulations on many imports that are not of est trading partner. In 2007, the United States agricultural nature. Both nations have agreed to exported $17.24 billion worth goods to India and discuss improved facets on the trade of Indian imported $24.02 billion worth of Indian goods. regulation requirements, jewelry, computer parts, Major items exported by India to the U.S. include motorcycles, fertilizer, and those tariffs that af- information technology Services, textiles, machin- fect the American process of exporting boric acid. ery, ITeS, gems and diamonds, chemicals, iron and steel products, coffee, tea, and other edible food The two nations have discussed matters such as products. Major American items imported by In- those who wish to break into the accounting mar- dia include aircraft, fertilizers, computer hard- ket, Indian companies gaining licenses for the tele- ware, scrap metal and medical equipment. communications industry, and setting polices by the interaction of companies from both countries The United States is also India's largest investment regarding new policies related to Indian media and partner, with American direct investment of $9 broadcasting. This group has strived to exchange billion accounting for 9% of total foreign invest- valuable information on recognizing different pro- ment into India. Americans have made notable fessional services offered by the two countries, dis- foreign investment in India's power generation, cussing the movement and positioning of people Copyright © 2009 | WWW.UPSCPORTAL.COM 9

Section -1 (Article : US-India Relationship) in developing industries and assigning jobs to those Obama Administration and people, continuation of talks in how India's citi- Bilateral Relations zens can gain access into the market for fi a nc i al n servicing, and discussing the limitation of equi- Despite much gains in Indo-American relations ties. during the tenure of the Bush administration, In- dia was not one of the Asian countries U.S. Secre- The two countries have had talks about the re- tary of State Hillary Clinton visited in February striction of investments in industries such as fi - 2009. The Foreign Policy magazine reported that nancial services, insurance, and retail. Also, to take even though Foreign Policy Staff of the previous advantage of any initiatives in joint investments administration had recommended India as a "key such as agricultural processing and the transpor- stop" during any such offi al tour o A ia, H llary ci f s i tation industries. Both countries have decided to Clinton will not be making a visit to New Delhi. promote small business initiatives in both coun- The exclusion of India from the Asian tour was tries by allowing trade between them. regarded as a "mistake" by some analysts. India was not even mentioned once in the Obama The Majority of Exports from the United States to administration's offi al forei gn p icy a ci ol genda. T he India Include: aviation equipment, engineering Forbes magazine alerted U.S. President Barack materials and machinery, instruments used in Obama on the need to prevent United States' new- optical and medical sectors, fertilizers, and stones found alliance with India from erosion. and metals.Below are the percentages of traded items India to US increased by 21.12% to $6.94 The initial approach of the Obama administration billion. towards ties with India raised concerns of a downturn in Indo-American relations. In an editorial, » Diamonds and precious stones(25%) the National Interest suggested that the Obama administration could possibly damage "the foun- » Textiles (29.01%) dations underlying the geostrategic partnership" » Iron and Steel (5.81%) between India and the United States. Another editorial published by the Taipei Times high- » Organic chemicals (4.3%) lighted the importance of India-U.S. relations and » Machinery (4.6%) urged Barack Obama to give India the attention it deserves.Terming India to be United States' in- » Electrical Machinery (4.28%) dispensable ally, the Christian Science Monitor argued that the Obama administration needs Major Items of Export from U.S. to India: For India's cooperation on several issues, including the year 2006, fiur es a a labl e u to th m nt h g re vai p e o climate change, Afghanistan war and energy se- of April. Merchandise exports from US to India curity and therefore, Obama cannot risk putting increased by 20.09.26% to US $2.95 billion. Se- ties with India on back-burner. lect major items with their percentage shares are given below Engineering goods and machinery (in- In an attempt to bolster relations between the two cluding electrical) (31.2%) countries, U.S. Secretary of State Hillary Clinton » Precious stones and metals (8.01%) will be making a visit to India in the second half of July 2009. Calling India a key partner of the » Organic chemicals (4.98%) United States, Clinton said that the United States » Optical instruments and equipment (7.33%) wants India to succeed as an anchor for regional and global security. She also mentioned four plat- » Aviation and aircraft ( 16.8%) forms for building future U.S.-India relationship global security, human development, economic activity, science and technology. Copyright © 2009 | WWW.UPSCPORTAL.COM 10

Section -1 (Article : US-India Relationship) Foreign Policy Issues: According to some ana- at the world trade organization. However, the lysts, India-U.S. relations have strained over outsourcing advisory head of KPMG said that In- Obama administration's approach in handling the dia had no reason to worry since Obama's state- Tiliban Insurgency in Afghanistan and Pakistan. ments were directed against "outsourcing being India's national security adviser, M.K. Narayanan, carried out by manufacturing companies" and not , criticized the Obama administration for linking outsourcing of IT-related services. the Kashmir dispute to the instability in Pakistan and Afghanistan and said that by doing so, Presi- In May 2009, U.S. President Barack Obama reit- dent Obama was "barking up the wrong tree".The erated his anti-outsourcing views and criticized Foreign Policy too criticized Obama's approach the current U.S. tax policy "that says you should towards South Asia saying that "India can be a pay lower taxes if you create a job in Bangalore, part of the solution rather than part of the prob- India, than if you create one in Buffalo, New York." lem" in South Asia and suggested India to take a However, during the U.S.-India Business Council more proactive role in rebuilding Afghanistan ir- meet in June 2009, U.S. secretary of state Hillary respective of the attitude of the Obama adminis- Clinton advocated for stronger economic ties be- tration. In a clear indication of growing rift between India and the United States. She also re- tween India and the U.S., the former decided not buked protectionist policies saying that "[United to accept a U.S. invitation to attend a conference States] will not use the global fi a nc i al c n risis a a s n on Afghanistan. Bloomberg reported that since excuse to fall back on protectionism. We hope 2008 Mumbai attacks, the public mood in India India will work with us to create a more open, has been to pressure Pakistan more aggressively equitable set of opportunities for trade between to take actions against the culprits behind the ter- our nations." In June 2009, United States provided rorist attack and this might refl o th u ect n e pcom - diplomatic help in successfully pushing through a ing general elections in May 2009. Consequently, US$2.9 billion loan sponsored by the Asian De- the Obama administration may fi d itsel f a o n t dds velopment Bank, despite considerable opposition with India's rigid stance against terrorism. Robert from the People’s Republic of China. Blake, assistant secretary of United States' Bureau of South and Central Asian Affairs, dismissed any Strategic and Military Relations: In March 2009, concerns over a rift with India regarding United the Obama administration cleared the US$2.1 bil- States' AfPak policy. Calling India and the United lion sale of eight P-8 Poseidons to India, the larg- States "natural allies", Blake said that the United est military deal between the two countries. In- States cannot afford to meet the strategic priori- dia expressed its concerns that Obama ties in Pakistan and Afghanistan at "the expense administration's non-military aid to Pakistan will of India". not be used for counter-insurgency, but for building up its military against India. However, Robert Economic Relations: India strongly criticized Blake, assistant secretary of Bureau of South and Obama administration's decision to limit H-1B Central Asian Affairs, said that the Pakistani Gov- visas and India's External Affairs Minister, Pranab ernment was increasingly focused at fi in th ght g e Mukherjee, said that his country would argue Taliban insurgency and expressed hope that the against U.S. "protectionism" at various interna- people of India would "support and agree with tional forums. The Vishwa Hindu Parishad, a close what we are trying to do". aide of India's main opposition party the BJP, said that if the United States continues with its anti- Concerns were raised in India that the Obama outsourcing policies, then India will "have to take administration was delaying the full implemen- steps to hurt American companies in India." India's tation of the Indo-U.S. Nuclear Deal. The Obama Commerce Minister, Kamal Nath, said that India administration has also strongly advocated for the may move against Obama's outsourcing policies strengthening of the comprehensive test ban Copyright © 2009 | WWW.UPSCPORTAL.COM 11

Section -1 (Article : US-India Relationship) treaty and has pressurized India to sign the agree- the Pakistan army. Kissinger was particularly con- ment. India's special envoy, Shyam Saran, cerned about Soviet expansion into South Asia as "warned" the United States that India would con- a result of a treaty of friendship that had recently tinue to oppose any such treaty as it was been signed between India and the Soviet Union, "discriminatory".In June 2009, U.S. Secretary of and sought to demonstrate to the People’s Repub- State Hillary Clinton said that the Obama admin- lic of China the value of a tacit alliance with the istration was "fully committed" to the Indo-U.S. United States. civil nuclear agreement. During the Indo-Pakistan war of 1971,Indian U.S. chairman of the joint chiefs of staff Mike Armed Forces, along with the Mukti Bahini, suc- Mullen encouraged stronger military ties between ceeded in liberating East Pakistan which soon de- India and the United States and said that "India clared independence. Richard Nixon, then US has emerged as an increasingly important strate- President, feared that an Indian invasion of West gic partner. Pakistan would mean total Soviet domination of the region, and that it would seriously undermine Background the global position of the United States and the regional position of America's new tacit ally, India played a key role in establishing the Non- China. In order to demonstrate to China the bona Aligned Movement in 1961. Though India pur- fi es o th U i ted S at es a an a ly and in d rect d f e n t s l , i sued close relations with both US and USSR, it violation of the US Congress-imposed sanctions decided not to join any major power bloc and re- on Pakistan, Nixon sent military supplies to Paki- frained from joining military alliances. India, how- stan, routing them through Jordan and Iran, while ever began establishing close military relationship also encouraging China to increase its arms sup- with the Soviet Union. plies to Pakistan. After the Sino-Indian war and the Indo-Pakistan When Pakistan's defeat in the eastern sector war of 1965, India made considerable changes to seemed certain, Nixon sent the USS Enterprise to its foreign policy. It developed a close relation- the Bay of Bengal, a move deemed by the Indians ship with the Soviet Union and started receiving as a nuclear threat. The Enterprise arrived on sta- massive military equipment and fi a nc i al assis- n tion on December 11, 1971. On 6 December and tance from the USSR. This had an adverse effect 13 December, the Soviet Navy dispatched two on the Indo-US relationship. The United States groups of ships, armed with nuclear missiles, from saw Pakistan as a counter-weight to pro-Soviet Vladivostok; they trailed U.S. Task Force 74 into India and started giving the former military assis- the Indian Ocean from 18 December 1971 until 7 tance. This created an atmosphere of suspicion be- January 1972. The Soviets also sent a nuclear sub- tween India and US. The US-India relationship marine to ward off the threat posed by USS En- suffered a considerable setback during the Soviet terprise in the Indian Ocean. Invasion of Afghanistan when India openly supported the Soviet Union. Relations between India Though American efforts had no effect in turning and the United States came to an all-time low the tide of the war, the incident involving USS during the early 1970s. Enterprise is viewed as the trigger for India's subsequent nuclear program. American policy to- Despite reports of atrocities in East Pakistan, and wards the end of the war was dictated primarily being told, most notably in the Blood telegram, of by a need to restrict the escalation of war on the genocidal activities being perpetrated by Pakistani western sector to prevent the 'dismemberment' forces, U.S. Secretary of State Henry Kissinger and of West Pakistan. Years after the war, many U.S. President Richard Nixon did nothing to dis- American writers criticized the White House poli- courage then Pakistani President Yahya Khan and cies during the war as being badly fl e d a ill- aw nd Copyright © 2009 | WWW.UPSCPORTAL.COM 12

Section -1 (Article : US-India Relationship) serving the interests of the United States. India States in response to India's nuclear tests in May carried out nuclear tests a few years later result- 1998 appeared, at least initially, to seriously dam- ing in sanctions being imposed by United States, age Indo-American relations. President Bill further drifting the two countries apart. In recent Clinton imposed wide-ranging sanctions pursuant years, Kissinger came under fi for com nt s re me to the 1994 nuclear proliferation prevention act. made during the Indo-Pakistan War in which he U.S. sanctions on Indian entities involved in the described Indians as "bastards." Kissinger has since nuclear industry and opposition to international expressed his regret over the comments. fi a nc i al in titu io lo n s t n ans for n hum ni tarian on- a assistance projects in India. The United States en- Since the end of the cold war , India-US relations couraged India to sign the comprehensive test ban have improved dramatically. This has largely been treaty (CTBT) immediately and without condition. fostered by the fact that the US and India are both The U.S. also called for restraint in missile and democracies and have a large and growing trade nuclear testing and deployment by both India and relationship. During the gulf war, the economy Pakistan. The non-proliferation dialogue initiated of India went through an extremely diffi t cul after the 1998 nuclear tests has bridged many of phase. The Government of India liberalized the the gaps in understanding between the countries. Indian economy. After the break up of the Soviet Union, India started looking for new allies and After the September 11,2001 attacks, Indian in- tried improving diplomatic relations with the telligence agencies provided the U.S. with signifi- members of the NATO particularly the United cant information on Al-Qaeda and related groups' States, Canada, France and Germany. In 1992, activities in Pakistan and Afghanistan. India's ex- India established formal diplomatic relations with tensive contribution to the war on terrorism has Israel. helped India's diplomatic relations with several countries. Over the past few years, India has held In the mid-1990s, India tried to attract world at- numerous joint military exercises with U.S. and tention towards the Pakistan backed terrorism in European nations that have resulted in a strength- Kashmir. The Kargil war resulted in a major dip- ened U.S.-India and E.U.-India bilateral relation- lomatic victory for India. The United States and ship. India's bilateral trade with Europe and U.S. European Union recognized the fact that Pakistani has more than doubled in the last fi e y v ears. military had illegally infi ed in o In an terri- ltrat t di tory and pressurized Pakistan to withdraw from However, India has yet to sign the CTBT, or the Kargil. Several anti-India terrorist groups based nuclear non proliferation treaty, claiming the dis- in Pakistan were labelled as terrorist groups by criminatory nature of the treaty that allows the the United States and European Union. fi e decl ared nucl ear count ries of th w r ld to v e o keep their nuclear arsenal and develop it using In 1998, India tested nuclear weapons which re- computer simulation testing. Prior to its nuclear sulted in several U.S., Japanese and European sanc- testing, India had pressed for a comprehensive de- tions on India. India's then defence minister, struction of nuclear weapons by all countries of George Fernandes, said that India's nuclear pro- the world in a time-bound frame. This was not gram was necessary as it provided a deterrence to acceptable to the US and other countries. Pres- some potential nuclear threat. Most of the sanc- ently, India has declared its policy of "no-fi u e rst s tions imposed on India were removed by 2001. of nuclear weapons" and the maintenance of a India has categorically stated that it will never use "credible nuclear deterrence". The US, under weapons fi b w ll d end if at tacked. In fact rst ut i ef President George W. Bush has also lifted most of Pakistan is the fi count ry th t In a in or m if rst a di f s its sanctions on India and has resumed military any nuclear tests are on the agenda. co-operation. Relations with US have considerably improved in the recent years, with the two The economic sanctions imposed by the United countries taking part in joint naval exercises off Copyright © 2009 | WWW.UPSCPORTAL.COM 13

Section -1 (Article : US-India Relationship) the coast of India and joint air exercises both in policymakers by the late sixties, this unidimen- India as well as in the United States. sional alliance disappeared into thin air. India has been pushing for reforms in the UN and The end of the Cold War necessitated as well as WTO with mixed results. India's candidature for facilitated the infusion of strategic content to Indo- a permanent seat at the UN security council is US relations–this time multidimensional.In the currently backed by several countries including post Cold War era, the strategic objectives of In- United Kingdom, France, Germany, Japan, Bra- dia and the US converges on a number of issues zil, African Union nations and recently People’s and not just one–as well as the case earlier. These Republic of China. In 2005, the United States issues include, inter alia, containment of terror- signed a nuclear co-operation agreement with ism, promotion of democracy, counter prolifera- India even though the latter is not a part of the tion, freedom of navigation in the Indian Ocean, NPT. The US argued that India's strong nuclear Asian balance of power, etc. non-proliferation record made it an exception and persuaded other NSG members to sign similar deals One of the very interesting feature of Indo-US with India. relations of recent times is the changes on the terms of engagement between the two countries On March 2, 2006 India and the US signed the on the issue of nuclear proliferation.While ear- Indo-U.S. nuclear pact on co-operation in civilian lier, in the US strategic thinking on nuclear pro- nuclear fi d T s w s signe d d in th four d el . hi a ur g e ays liferation, India fi ed m i n y b gur a l ecaus e o A ri- f me state visit of US president George Bush in India. can concern about latter’s nuclear and missile On its part, India would separate its civilian and programmes, in the twenti-fi c u y, h e ver, rst ent r ow military nuclear programs, and the civilian pro- American strategic thinking on the issue of nuclear grams would be brought under the safeguards of proliferation has undergone radical International Atomic Energy Agency (IAEA). The reorientation.Now, the Americans are increasingly United States would sell India the reactor tech- realising the futility of insisting on a rollback of nologies and the nuclear fuel for setting up and India’s nuclear programme. They, rather, want to upgrading its civilian nuclear program. The U.S. leverage India’s growing power and infl enc e in u Congress needs to ratify this pact since U.S. fed- favour of their broader nonproliferation and eral law prohibits the trading of nuclear technolo- counter proliferation objectives. gies and materials outside the framework of the Nuclear Suppliers Group (NSG). As promotion of democracy around the world is one of the most important foreign policy objec- Indo-US Strategic Partnership tive of the USA, India- as the largest democracy of the world-can hardly be ignored by the US. Indo-US relations got strategic content way back This is the reason, cooperation in promotion of in early sixties. The rise of China worried the democracy in the world has become one of the policymakers in Washington. Chinese annexation most important facets of Indo-US relations in re- of Tibet, its role in Korean war and other such cent times.India is a founding member of the acts convinced Washington about the expansion- ‘Community of Democracies’ – a prominent en- ist designs of the Chinese. As the relations between deavour of the US on promotion of India and China deteriorated during late fi , fties democracy.However,India rejected the suggestion the Americans found a golden opportunity to take of the US about setting up a Centre for Asian De- advantage of this situation to promote India as a mocracy. counterweight to China But any unidimensional alliance is bound to be short-lived and this alli- Agriculture is another important area of coopera- ance was no exception to this general rule. As tion between India and the USA in present times. China ceased to be a headache for the American Copyright © 2009 | WWW.UPSCPORTAL.COM 14

Section -1 (Article : US-India Relationship) Considering the fact that both the nations at present have a vast pool of human resources adept at knowledge economy, it is only natural that the most optimal course such partnership can aim at is harnessing these human resources by concentrating on development and dissemination of agricultural knowledge through research, education and training etc.An initiative to forge such a partnership is the 'India-US Knowledge Initiative on Agriculture' (KIA). (IMP) Get UPSCPORTAL , Jobs, Re- sults, Notification Alerts on Email. Step-1: Fill Your Email address in form below. you will get a confirmation email within 10 min. Step-2: Varify your email by clicking on the link in the email. (check Inbox and Spam fold- ers) Step-3: Done! Now you will regular Alerts on your email. Advertise your Business Here Contact Us Online: http://upscportal.com/store/contact Copyright © 2009 | WWW.UPSCPORTAL.COM 15

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Section -1 (Article : 35th G-8 Annual Summit) 35th G-8 Annual Summit Insuring Global Food Security with Economic Stability By Dr. Nageshwar Nath Mishra The Author is Professor and Head of the Department for History 35th G8 Summit was held in L’Aquila, Italy the ments, old and new mindful that some in the G8 country that currently holds the G8 Presidency had fallen well short of their 2005 promise to in- from 8 to 10 July,2009. G8 leaders pledged $20 crease annual aid by $50 billion by 2010, half of billion in aid to help poor na- which was meant for tions feed themselves, surpass- Africa.South African President ing expectations of a summit Jacob Zuma said the new fund- that made little ground on cli- ing will "go a long way" to help- mate change and may spell the ing Africa, adding: "We can't say end of the G8 itself. U.S. Presi- it's enough, but at least it begins dent Barack Obama and the to do very concrete things." summit's Italian host Silvio Berlusconi refl ed gr ow n ect i g Nigerian Agriculture Minister consensus that the Group of Abba Ruma said the new pledge Eight industrial powers, long was "very commendable in view criticized as an elite club, does of the current global recession. not refl th sh ftin p terns ect e i g at "But he cautioned that it must of global economic be "disbursed expeditiously. It is power.Tackling global chal- only then we will know that the lenges "in the absence of major G8 is living up to its commitment powers like China, India and Brazil seems to be and not just making a pledge and going to sleep." wrongheaded," Obama said, adding that he looked forward to "fewer summit meetings." The United Nations said the number of malnour- ished people has risen in the past two years and is Begun in 1975 with six members, the G8 now expected to top 1.02 billion this year, reversing groups the United States, Japan, Germany, France, decades of declines. The global recession is ex- Britain, Italy, Russia and Canada. That enabled pected to make 103 million more go hungry. Aid Obama, traveling to Ghana on his fi trip to sub- rst bodies like the World Food Program said a Saharan Africa as president, to use the summit to last-minute surge of generosity at the summit in push for a shift toward agricultural investment L'Aquila resulting in the $20 billion pledge was from food aid. Washington will make $3.5 billion "greeted with great happiness. "That amount over available to the 3-year program. "There is no rea- three years may compare unfavorably with the son Africa should not be self-suffi ent w e n it ci h $13.4 billion the G8 says it disbursed between comes to food," said Obama, recalling that his rela- January 2008 and July 2009, but aid groups said tives in Kenya live "in villages where hunger is the new pledge in Italy was more clearly focused. real," though they themselves are not going hun- Japan and the European Union were also champi- gry. oning a code of conduct for responsible investment after growing farmland acquisition or "land Obama said Africa had enough arable land but grabs" in emerging nations. The group of eight de- lacked seeds, irrigation and mechanisms for farm- veloped countries have vowed to curb transfer ers to get a fair price for their produce issues that enrichment and reprocessing (ENR) technology the summit promised to tackle.Africa told the and equipment, surprising India as it goes against wealthy powers they must honor their commit- the spirit of Nuclear Suppliers Group's "clean" waiver to it. In a joint statement on non-prolif- Copyright © 2009 | WWW.UPSCPORTAL.COM 18

Section -1 (Article : 35th G-8 Annual Summit) eration, the G-8 nations also pushed other mem- policies, including safety nets, health and educa- bers of the 45-nation NSG to reach a consensus tion. within this year to disallow transfer of ENR to countries which are not signatories to NPT. The The declaration committed the G8 and the G5 to statement was issued after the Summit that was “facilitating the development, dissemination and attended by Prime Minister Manmohan Singh in mutually agreed transfer of clean, low-carbon L'Aquila. technologies, reducing carbon emissions and increasing energy effi enc y. ” T l eaders recon- ci he The move, which would have an impact on India, fi e d th i r p itical w ll to reach a “com r ehe n- rm e ol i p comes even though the NSG had last September sive, fair, effective, agreed outcome, following the given New Delhi "clean" and "full" waiver for civil principles of common but differentiated respon- nuclear cooperation with the world despite it be- sibilities and respective capabilities” at the United ing a non-signatory to NPT. "To reduce the pro- Nations climate change conference in Copenhagen liferation risks associated with the spread of en- in December. richment and reprocessing facilities, equipment and technology, we welcome the progress that This is the fi tim in a G p u G sum t th t rst e 8 l s 5 mi a continues to be made by the NSG on mechanisms a joint declaration has been issued. The G8 and to strengthen controls on transfers of such enrich- G5 nations decided to continue the dialogue pro- ment and reprocessing items and technology," said cess started in 2007 in Heiligendamm, Germany, the statement issued yesterday. While noting that and now renamed the Heiligendamm-L’Aquila the NSG has not yet reached consensus on this Process (HAP). This dialogue process has been issue, the G-8 nations said "we agree that NSG described as a partnership on an equal footing and discussions have yielded useful and constructive a steering committee will prepare a report for the proposals contained in the NSG's “clean text” de- next G8 plus G5 summit in Muskoka. The joint veloped at the November 20,2008 Consultative declaration said the G8 and the G5 countries were Group meeting. committed to advancing the reform process in international organizations, including the United The leaders stressed that the standstill commit- Nations, “to refl c em orary real ity a c l - ect ont p nd ha ments made at the London G20 summit must be lenges thus enhancing their relevance, legitimacy adhered to and to refrain from introducing barri- and effi enc y. ” ci ers to trade and investment. They asked the World Trade Organisation and other international bod- Debatable Issues ies to monitor the situation and report publicly on adherence on a quarterly basis. They also com- Prime Minister Silvio Berlusconi, spoke in his ca- mitted themselves to refraining from competitive pacity as President of the G8, summed up the main devaluations of the currencies and to a stable and points on the agenda for debate at the Summit well functioning international monetary system. Economic Crisis and a Boost to Growth: Posi- The declaration expressed the joint commitment tive pointers to improvement in the economy are of the G8 and G5 to implement rapidly the deci- starting to emerge and it is important to support sions taken at the Washington and London G20 families' and businesses' confi enc e i n or der to d summits, including those on providing additional rapidly trigger economic recovery. The current resources to the international fi a nc i al i n titu n s - economic and fi a nc i al c n risis h s h ghl ight ed c a i er- tions. Noting the high social costs of the current tain crucial weaknesses in the global economy, economic crisis, the countries committed them- which have helped to trigger and to spread the selves to tackling the social dimensions, putting crisis itself. Hence the need to thrash out a code people fi T y w re m derni sin rei n or ci n rst. he e o g, f g of shared ground rules for the world of the and increasing the effi enc y o soci al p ot ect io ci f r n economy and of fi a nc e w th speci fi clear cri te- n i c, Copyright © 2009 | WWW.UPSCPORTAL.COM 19

Section -1 (Article : 35th G-8 Annual Summit) ria and with the establishment of supervisory bodies and tools. One of the issues on the agenda at Development in the Poorer Countries and in the G8 Summit in L'Aquila was the strategy de- Africa: The Summit broadcasted a strong message signed to put together a series of common prin- designed to attenuate the impact of the crisis on ciples governing the rules of propriety, integrity developing countries, an impact that is jeopardiz- and transparency in international fi a nc e and n ing the progress made to date in the struggle business. against poverty. It planed to do this by putting together a "rescue package" entailing: confi a - rm Imparting a Fresh Boost to International Trade: tion of the G8's commitment to development aid; Another crucial factor in combating the economic the use of innovative fi a nc i al tool s; h l v n th n a i g e crisis and in imparting a fresh boost to growth is cost of emigrants' remittance transactions; and international trade: the aim of the Summit in imparting a fresh boost to international trade; not L'Aquila was to impart a new thrust to the Doha to mention the debt issue. The G8 is promoting a talks on world trade, in order to help ensure that new approach to backing development in the the talks are successfully completed as rapidly as poorer countries based on the involvement of the possible. Achieving an ambitious and balanced "country system" as a whole. This, in order to agreement would make it possible to boost global make the most of the role played by all of the exports and to support development in the poorer actors (governments, local authorities, private in- countries by offering them improved access to dividuals and civil society) and all of the available markets in the wealthy countries. resources and policies in both donor and destination countries in boosting growth and develop- People First: People fi rst: th t is th 2009 G a e 8 ment in the poorer countries. The issue of devel- Summit's message. The international community opment has addressed, with differing nuances, is living through one of its most serious economic both at the G8 sessions and at the sessions with and fi a nc i al c n rises sin e W r ld W r II. If w a c o a e re the emerging and African countries. to make it through this crisis, we have to consider its social aspect and to place people in the centre Food Safety and Security, and Access to Water: of government action by pursuing policies de- Over 1 billion people are currently suffering from signed to restore people's confi enc e. C unt ries d o starvation or malnutrition. The situation had been must continue to implement strategies capable of aggravated by insuffi ent in tm nt in farm n ci ves e i g reducing the impact of the crisis on employment, over the past few decades, and by the economic and of ensuring that welfare and social safeguard crisis. All of the leaders attended the L'Aquila systems are both effective and sustainable. summit signed a joint declaration with the international organizations and launched an important Climate Changes: The struggle against climate initiative on food safety and security, to fund farm- changes is one of the Italian Presidency's priori- ing and to support the struggle against starvation. ties on the G8 Agenda. It is necessary to defi e a n Moreover, the G8 under Italy's presidency was global response in which the leadership and com- committed to laying the groundwork for launch- mitment of the industrially advanced countries is ing a G8-Africa Partnership designed to improve paralleled by an active contribution from the access to water and to basic sanitary facilities, be- emerging and developing countries on the basis fore the end of the year. of a balanced sharing of responsibilities. In that sense, the L'Aquila G8 Summit, which will also Health: World health has traditionally been one be hosting the fi ever m et in of th M j o rst e g e a r of the central issues on the G8 group's agenda, Economies Forum on Energy and Climate (MEF) and the Italian Presidency planed to continue de- at leadership level, is going to be a vital step in voting particular attention to it. The key topics paving the way for the success of the United Na- included strengthening health systems and cut- tions Conference in Copenhagen next December. ting infant mortality and death during childbirth. Copyright © 2009 | WWW.UPSCPORTAL.COM 20

Section -1 (Article : 35th G-8 Annual Summit) On the basis of the experience garnered in the ening food poverty. launch of the Global Fund at the G8 Summit in The G5 declared its commitment to engage with Genoa in 2001, there is to be ongoing support for all World Trade Organisation members to com- programmes designed to combat AIDS, tubercu- plete the Doha round of negotiations. It wanted losis and malaria, also through the exploration of the negotiations to deliver real and improved mar- innovative forms of funding. ket access to the developing countries. On the contentious issues of agriculture and non-agricul- International Political Issues: The G8 Summit ture market access, the G5 leaders wanted the addressed the most important political issues on mandates already negotiated to be upheld and not the international agenda: the commitment to reopened selectively in a way that will upset the making progress on the nuclear non-proliferation overall balance. front, the situation in Iran and in the Middle East, the struggle against terrorism, the stabilization of The leaders wanted the negotiations on climate the Afghanistan and Pakistan region, and the situ- change to move forward to a successful conclu- ation in North Korea. sion at Copenhagen on the basis of joint but differentiated responsibility. They urged the devel- Strengthening The Reform Process oped countries to commit themselves to reducing their emissions by at least 40 per cent below the Leaders of the developing countries meeting at 1990 levels by 2020. They also wanted the con- their parallel G5 summit at the venue of the G8 ference to consider the funding arrangements for summit urged the industrial nations to deliver on the developing countries to cut emissions and an the commitments they had made on fia nc i al a n nd international mechanism for developing and trans- credit flw a o a d n p ot ect io sm A th o s nd n voi i g r ni . t e ferring climate-friendly technologies. The G5 dec- end of meetings, which the chairman, President laration also stressed the need for the strongest Felipe Calderon of Mexico, described as “quite collective action by the international community interesting and very productive,” the G5 came out to prevent terror attacks and punish the perpe- with a declaration that it was important to com- trators. To provide an effective international le- ply with the agreements reached at the earlier G8 gal framework against terrorism, it called upon and G5 meetings and particularly at the London the United Nations members to conclude and G20 summit in April. These related to the steps to adopt as early as possible a comprehensive con- address the economic crisis jointly and in particu- vention on international terrorism. lar the commitment to provide the resources to restart credit fl w to th d os e evel o n count ries . pi g Climate Change The sudden departure of Chinese President Hu India considered the declaration on climate change Jintao to deal with the ethnic violence in the in the agreed draft at the Major Economies Fo- Xinjiang region cast a shadow over the delibera- rum a “very strong political message” that would tions of the G5, but the Chinese delegation re- provide impetus to the negotiations on climate mained as an active participant. The G5 came out change before the Copenhagen summit in Decem- with a political declaration and another on trade ber. that were presented at a joint press appearance where the leaders made opening statements. The Prime Minister’s special envoy on climate change, Shyam Saran, said at a briefig o th sid n n e e- Prime Minister Manmohan Singh stressed in his lines of the G8 and G5 meetings that the declara- remarks that the developing countries had been tion was positive and forward looking and would the worse hit by the economic crisis, and a collec- send the right kind of message, though the spe- tive approach to recovery should address their cifi w ul d ha ve to be ne got iat ed under th cs o e problems of drying up of credit fl w and w r s- os o United Nations Framework Convention on Cli- Copyright © 2009 | WWW.UPSCPORTAL.COM 21

Section -1 (Article : 35th G-8 Annual Summit) mate Change leading to the Copenhagen on the development and transfer of technology summit.Outlining the perspectives of the G5 de- for climate change. veloping countries, including India, he said that The Green Fund proposed by Mexico and endorsed while climate change was a global challenge, there by both the G5 and the G8, involved contribu- was an aspect of historical responsibility of the tions by all nations assessed on the basis of their industrial countries for the accumulated emissions historical responsibility, current level of develop- in the atmosphere. On the principle of “polluter ment and weighted per capita emissions. From the pays,” the major responsibility lay with the in- Indian viewpoint, the principle of assessed con- dustrial nations, and this was a responsibility that tribution would be welcome as it would provide they had acknowledged and undertaken under the stable resources. UNFCCC. As regards the binding reduction targets for India The developing countries wanted the industrial and the other developing countries that have so nations to commit themselves to sharp and sig- far been exempt from such commitments, India niﬁcant reduct io in em ssio by 40 per cent ns i ns was already committed to the goal of sustainable below the 1990 (the date of the Kyoto protocol) development, and there has to be a deviation from levels by 2020. This could form the basis for a more the business as usual path of growth. However, ambitious target over the longer term. without clarity on capacity building, funding and technology transfer for climate friendly technolo- The developing nations were faced with the prob- gies, India and the other developing countries were lem of adaptation to climate change and India it- unable to give binding commitments on emission self was spending 2 to 2.5 per cent of its Gross reduction targets. However, they were commit- Domestic Product on adaptation, including to ex- ted to the overall goal of keeping the rise in aver- treme climatic events and disasters and the image global temperature to below 2 degrees over pact on agriculture. Even if emissions were re- the pre-industrialisation levels. duced to zero, the accumulated emissions would continue to impose a long term burden on the Proposals and Understandings developing countries. » The Leaders of the Group of Eight meeting in Based on this perspective, the developing coun- L’Aquila, expressed their heartfelt solidarity to the tries have been emphasising the two pillars of ﬁ - people of Abruzzo affected by the tragic earth- nancing mitigation and adaptation actions and the quake which struck the region on 6th April 2009, transfer of technology. The position of the G5 was and to all those around the world who have been that there should be predictable, stable and ad- touched by natural disasters. equate resources available for a credible response from the developing countries and the industrial nations could provide 0.5 per cent to 1 per cent of » G8 determined to ensure sustainable growth their GDP for the purpose. The G5 also wanted and to tackle the interlinked challenges of the the existing climate-friendly technologies to be economic crisis, poverty and climate change. diffused rapidly and widely. In addition, they These challenges require immediate action and wanted a global programme for capacity building long term vision. to combat climate change put in place. Transfor- mational technologies, including on clean energy » Guided by their common values, G8 addressed and new and renewable sources, needed to be de- global issues and promote a world economy that veloped and provided. It was with these goals that is open, innovative, sustainable and fair. To this India, in association with the United Nations, was end, effective and responsible leadership is re- organising a conference in New Delhi in October quired. G8 determined to fully take on their responsibilities, and are committed to implement- Copyright © 2009 | WWW.UPSCPORTAL.COM 22

Section -1 (Article : 35th G-8 Annual Summit) ing their decisions, and to adopting a full and com- taken at the London Summit to take all necessary prehensive accountability mechanism by 2010 to steps to support demand, restore growth and main- monitor progress and strengthen the effectiveness tain fi a nc i al stabi lity, in l u n strengt h ni n n c di g e g of actions. fi a nc i al regul at io and In erna t io l Fi n nc i al n n t na a Institutions (IFIs) and maintaining open markets » G8 remain focused on the economic and fina n- worldwide. G8 continue to implement swiftly these decisions and call on all countries to act de- cial crisis and its human and social consequences. cisively to reinforce the international economic G8 will continue to work together to restore con- and fi a nc i al sys tem and to w r k cooperat iv y n , o el fi enc e and set grow h o a m r e robus t, green, d t n o and responsibly with regard to the impact on other inclusive and sustainable path. This will include countries. strengthening standards of integrity, propriety and transparency for economic activities. » G8 taken stock of progress made to date to re- » G8 intended to secure present and future pros- store confi enc e, stabi lise th fianci al se or an d e n ct d provide stimulus to boost growth and create jobs. perity by taking the lead in the fi agai n t cl i- ght s Despite the current diffi t condi tio , w w ll cul ns e i mate change. G8 committed to reaching a global, continue to address global challenges, including ambitious and comprehensive agreement in fiht in p g g overty a c im t e c nge, w th th a m nd l a ha i e i Copenhagen. In this respect, G8 called upon other of establishing a more balanced and sustainable industrialised countries and emerging economies growth path, underpinned by sound fundamen- to actively engage, consistently with the principle tals and social inclusion. of common but differentiated responsibilities and respective capabilities. » The current fi a nc i al and econom c crisis h s n i a » G8 renewed all their commitments towards the reinforced the need generally for cooperation among key economies. The Heiligendamm Dia- poor, especially in Africa. G8 determined to un- logue Process (HDP), a topic-driven dialogue of dertake measures to mitigate the impact of the the G8 with major emerging economies – China, crisis on developing countries, and to continue to India, Brazil, Mexico and South Africa – estab- support their efforts to achieve the Millennium lished in 2007, has helped to fulfi th s rol e by l i Development Goals. serving as a platform to develop common understanding and shared responsibility in responding » The world economy is experiencing the most to the challenges of the world economy concern- severe economic and fi a nc i al d stu banc es in d n i r e- ing investment, innovation, development and en- cades. After several years of very high global ergy effi enc y, w i ch w ll b im or tant for g o ci h i e p l - growth, G8 have been facing challenging eco- bal economic growth going forward. The dialogue nomic conditions, characterised by fi a nc i al tu - n r has helped to gain a shared understanding of these moil, widespread recession, intense deleveraging, global challenges in order to fi d appr opr iat e re- n an abrupt decline in international trade and grow- sponses. G8 endorsed the results achieved until ing unemployment and social suffering. While now and called for an extension of this dialogue there are signs of stabilization, including a recov- among equals. ery of stock markets, a decline in interest rate spreads, improved business and consumer confi - » Since the beginning of the crisis G8 have taken dence, the situation remains uncertain and sig- an unprecedented and concerted action to ensure nificant risks rem i n to econom c and fin a i anci al recovery and repair our fi a nc i al sys tem . G8 n s stability. have: » G8 strongly reaffi e d com tm nt s under- rm mi e » Coordinated their efforts with partners at vari- Copyright © 2009 | WWW.UPSCPORTAL.COM 23

Section -1 (Article : 35th G-8 Annual Summit) ous levels in response to a crisis that has affected every corner of the world. They have taken force- » G8 call on all jurisdictions to adhere to interna- ful and coordinated action to provide stimulus to tional standards in the prudential, tax and Anti- economic growth.. Money Laundering and Combating Financing of Terrorism (AML-CFT) areas. To this end, they » They agreed on the need to prepare appropri- called on the appropriate bodies to conduct and ate strategies for unwinding the extraordinary strengthen objective peer-reviews, based on ex- policy measures taken to respond to the crisis once isting processes, including through the Financial the recovery is assured. These “exit strategies” will Sector Assessment Program (FSAP) process. vary from country to country depending on domestic economic conditions and public fi a nc es , n » They are pleased with the progress being made and must ensure a sustainable recovery over the by the Financial Action Task Force (FATF) in long term. They welcomed the analytical work of improving the standards for combating money the IMF which will assist them with this process. laundering and the fi a nc i n o terror ism a b n g f nd y the OECD on international standards of transpar- » Repairing the fi a nc i al s ect or , i n l u n n c di g ency. stabilising fianc i al m rket s a n a l isin b n a nd orm g ank- ing activity, is an urgent priority to ensure lasting » The fight a n t n cooperat iv ju isdi ct io gai s on- e r ns economic recovery. They are implementing should also encompass anti money laundering and swiftly the commitments made at the London terrorism fi a nc i n as w l l as in th a n g, e e rea o p u- f r Summit and call on others to join their efforts to dential regulations. G8 called on the Financial Sta- ensure global fi a nc i al stabi lity and an in erna - n t bility Board (FSB) to assess jurisdictions against tional level playing fi del . international supervisory and prudential standards. The FATF and FSB should report back by Sep- » In this difficul t tim , e th p ot ect io o tax b e r n f ase tember on their progress in identifying uncoop- and the efforts to combat tax fraud and tax eva- erative jurisdictions. sion are all the more important, especially given the extraordinary fi scal m as ur es adopt ed t o e » G8 noted that several countries are implement- stabilise the world economy and the need to ening voluntary compliance strategies in order to sure that economic activity is conducted in a fair repatriate assets held in non-cooperative jurisdic- and transparent manner. G8 are making progress tions, and the need is felt to defi e a di scus sio n n in promoting tax information exchange and trans- framework for interested countries. parency across the globe, which is helping to widen the acceptance of internationally agreed standards on the exchange of tax information and » Going forward, world needed a strategy to com- increase the number of bilateral agreements signed prehensively address long-term issues and lead the by several jurisdictions. But there is no space for global economy to stable, balanced and sustain- complacency: all jurisdictions must now quickly able growth. Achieving economic and social sta- implement their commitments. They cannot con- bility as a global public good requires better gov- tinue to tolerate large amounts of capital hidden ernance. Regulatory reform will reduce room for to evade taxation. excessive leveraging and risk taking and promote sound capitalisation of fia nc i al in titu io . C m n s t ns o - » G8 asked the OECD to swiftly address these mon principles and standards on propriety, integrity and transparency governing the conduct of challenges, propose further steps and report by international business and fi a nc e h l p p om t e n e r o the time of the next G20 Finance Ministers’ meet- a healthy and sustainable economic system. The ing. Copyright © 2009 | WWW.UPSCPORTAL.COM 24

Section -1 (Article : 35th G-8 Annual Summit) social dimension of growth is also crucial in this results. G8 are therefore committed to update G8 effort, through the promotion of employment op- anticorruption. portunities, the creation and updating of skills and the protection of the weakest through appropri- » G8 also welcomed the update of the Account- ate social safety nets and income support. ability Report: Implementation Review of G8 on Anti-Corruption Commitments which was pre- » Stable and sustained long-term growth will re- sented for the fi tim in T rst e oyako. W envi sage e quire a smooth unwinding of the existing imbal- making it a permanent tool which sets examples ances in current accounts. G8 recognised the im- on combating corruption and holds the G8 coun- portance of working together to ensure the nec- tries to the highest standards of transparency and essary adjustments in line with the multilaterally accountability. To this end, we appreciate the as- agreed strategies, which include supporting strong sistance of the OECD in preparing our regular re- internal demand in surplus countries and increas- ports on anti-corruption commitments. Going for- ing savings rates in defi t count ries th ough ap- ci r ward, we invite our major partners to prepare simi- propriate macroeconomic and structural policies. lar reports on their anti-corruption commitments. New sources of growth will have to be supported by investments in infrastructure, innovation and » G8 are committed to tackling the social dimen- education to facilitate productivity growth, while sion of the crisis, putting peoples’ concerns first. ensuring sustainable use of resources in a greener The impact of the economic crisis on labour mar- economy, within a context of open markets. kets can undermine social stability. Therefore, Greater macroeconomic policy coordination will good macroeconomic policies must be linked to also be needed to help ensure that the burden of employment and social policies that reduce un- adjustment is fairly shared. employment, enable a quick re-entry into the labour market and prevent social exclusion. We » G8 emphasized the need for an enhanced glo- support the conclusions of the G8 Social Summit bal framework for fi a nc i al regul at io a super- n n nd in Rome and the London Jobs Conference to take vision, promoting consistency between account- further coherent actions to reduce the impact of ing and prudential standards and setting up ad- the crisis on employment and maximise the po- equate tools to address procyclicality, as well as tential for growth in jobs, in accordance with the ensuring a comprehensive oversight of all systemi- following principles: cally significant ent ities and act iv ties . G com i 8 - mitted to vigorously pursue the work necessary » Promotion of active labour market policies to to ensure global fi a nc i al stabi lity a a in erna - n nd n t reduce unemployment, enhance skills develop- tional level playing fi d in l u n o c p ens a- el , c di g n om ment and match jobs with labour market needs; tion structures, defi i tio of capi tal and th ap- n n e maintain income support for the unemployed; propriate incentives for risk management of sustain existing employment, including through securitisation, accounting and prudential stan- partial dards, regulation and oversight of systemically important hedge funds, standardisation and resilience of OTC derivative markets, establishment of cen- » Unemployment schemes combined with train- tral clearing counterparties for these products, and ing provisions and temporary fl b e w r k or exi l o regulation and transparency of credit rating agen- other arrangements, such as employment subsi- cies. dies, in order to prevent lay-offs; » International cooperation against corruption » Ensuring the sustainability and effectiveness of should be enhanced in order to achieve effective social protection systems as drivers of confi enc e d Copyright © 2009 | WWW.UPSCPORTAL.COM 25

Section -1 (Article : 35th G-8 Annual Summit) and consequently of economic and employment vited the major international energy organisations recovery; to review and update their programmes and promote them in light of the changing energy chal- » G8 invited international organisations, in par- lenges. ticular the IMF, the OECD and the ILO, to take into account the labour and social impact of their » G8 reconfi e d th i r com tm nt to keep rm e mi e advice and cooperation with governments. markets open and free and to reject protectionism of any kind. In diffi t tim s G m s t a d p cul e 8 u voi ast » The emergency response to the economic crisis mistakes of protectionist policies, especially given the strong decline in world trade following the should not overlook the opportunity to facilitate economic crisis. Recovery needs a strong interna- a global green recovery putting our economies on tional trade component to be viable and the rel- a path towards more sustainable and resilient evant programmes must fully respect our obliga- growth. G8 fi scal stim l u p u s ackages are in reas- c tions and commitments to non-discriminatory ingly investing in measures encouraging the cre- treatment under WTO and other international ation of green jobs and low-carbon, energy effi - agreements. G8 will maximise efforts and steps to cient and sustainable growth. These include en- promote and facilitate trade and investment. ergy effi enc y m asur es , i n tm nt in publ ic ci e ves e transportation infrastructure, incentives for fuel- effi ent v cl es , res earch in al terna t iv sour ces ci ehi e » G8 stressed the importance of fully adhering to of energy, support for renewable energy technolo- the standstill commitment and the commitment gies, as well as in enhanced CO2 reduction, recy- to rectify protectionist measures adopted in Lon- cling and disposal such as Carbon Capture and don to avoid further deterioration of international Storage. trade, including refraining from taking decisions to increase tariffs above today’s levels. G8 will re- On goods and services directly linked to address- frain from raising new barriers to investment or ing climate change, as agreed at the Toyako Sum- to trade in goods and services, imposing new ex- mit. At the same time, G8 will ensure proper regu- ports restrictions, or implementing World Trade latory and other frameworks facilitating transi- Organisation (WTO) inconsistent measures to tion towards low-carbon and resource effi ent ci stimulate exports. growth. In this light, G8 has called for a reduction of subsidies that artifi al ly enc our age car- ci » G8 will continue to ensure that our share of the bon-intensive energy consumption. pledge taken in the London Summit of $250 billion of support for trade fi a nc e is p om t ly m de n r p a » The current financi al andeconom c c i risis sh d oul available through our export credit agencies not delay cost-effective investments or pro- (ECAs) and investment agencies and through grammed energy projects that would create jobs, Multilateral Development Banks. G8 support co- enhance energy security and help limit greenhouse ordination and cooperation in its implementation, gas emissions in the short and medium term. G8 and welcome exchange of information on the mea- has urged all countries and the private sector to sures taken in this regard. Cooperation among adopt a long-term view in planning their invest- ECAs, such as strengthening re-insurance ments. schemes, is expected to play an important role to this end. In this context, G8 reaffi e d th i r strong com rm e - mitment to implement the St Petersburg Prin- » The current crisis has affected capital fl w , os ciples on Global Energy Security in our countries including foreign direct investments (FDIs), which and call on others to join us in this effort. G8 in- represent an important source of fi a nc i n and a n g Copyright © 2009 | WWW.UPSCPORTAL.COM 26

Section -1 (Article : 35th G-8 Annual Summit) driver of economic growth and integration. G8 forts on technology and fi a nc i n G8: n g, stressed the positive role of long term investments. G8 will work to reverse the recent decline in FDI, » Strive for greater predictability of international by fostering an open, receptive climate for for- support and affi th i r in ent io to cont rib e rm e t n ut eign investment, especially in emerging and in de- fair share, in the context of an ambitious deal in veloping countries. Copenhagen; » Innovation and knowledge are key factors for » Affi th t al l count ries , except L ast D vel - rm a e e supporting the recovery and putting the world oped Countries (LDCs), should participate in the economy on a more sustainable growth path. G8 fi a nc i al ef for t to tackl e cl im t e cha nge, accor d- n a has intended to accelerate innovation in relation ing to criteria to be agreed, and G8 support con- to long-term challenges and to encourage the de- sideration of the proposal by Mexico; velopment of new industries, companies and services that will be decisive to create new sources of growth. G8 are committed to implementing » Call for the elaboration and implementation of innovation policies in our countries, also through an effective fi a nc i al a n rrangem nt to suppor t th e e our stimulus packages. G8 aimed to foster research, post-2012 regime. G8 underlined that mobilizing entrepreneurship, human capital and skills, green fi a nc i n f or devel o n count ri es , th ough a n g pi g r technologies and investment in infrastructure, broad range of fi a nc i al sour ces , in l u n fian- n c di g n including Information and Communication Tech- cial assistance, is required for adaptation and miti- nology (ICT) networks. gation, and to facilitate the transition to low-carbon economies. Financial support needs to be ef- » Recognising the importance of research and fi ent , ef fect iv and equi tabl e and t h ref or e ci e e linked to results in terms of emission reductions development, we committed in Toyako to increase and adaptation actions; investment in basic and applied clean technology research and development. G8 will intensify such efforts and explore options to enhance global tech- » Will work to ensure that the governance of nology cooperation. G8 believed that provisions mechanisms disbursing funds is transparent, fair, on fi a nc i n technol o res earch, d n g gy evel o e nt , pm effective, effi ent , a o b anc ed repr es ent at io ci nd f al n deployment and diffusion should form an inte- among developed. gral part of the post-2012 agreement. » Promote public-private partnerships, in order » Financing is central to achieving an agreement to facilitate targeted and effi ent in tm nt s in ci ves e at Copenhagen and requires mobilisation of sig- research, development, deployment and diffusion nifi cant fi anci al resour ces, bt h pu i c an pri - n o bl d of clean technologies, while mobilising additional vate. Given its capacity to innovate, the private resources from the private sector. sector should play a pivotal role in fi a nc i n in n g - vestments in new technologies. Public resources Promoting Global Food Security : Agriculture should therefore seek to leverage private-sector and food security should be placed at the core of fi a nc i n to suppor t res earch, d n g, evel o e nt and pm the international agenda. G8 welcomed the Final demonstration of low carbon technologies in or- Declaration of the G8 Ministers of Agriculture der to accelerate the development and deployment who recently met in Treviso, and commit to con- of early stage technologies, and to aid implemen- tinue working with partner countries and inter- tation of adaptation and mitigation strategies in national and regional organizations to foster the developing countries. To promote concerted ef- conditions for ensuring sustainable access to suffi ent , a for dabl e a saf e food to e ci f nd veryone . T he Copyright © 2009 | WWW.UPSCPORTAL.COM 27

Section -1 (Article : 35th G-8 Annual Summit) economic crisis dramatically changed the scenario climate change. faced when G8 last convened in Toyako. Although global commodity and food prices signifi lycant Noting a growing trend of international agricul- decreased in many regions, they remain high com- tural investment, including land leasing and pur- pared with historical levels. chases in developing countries, G8 will work with partner countries and international organizations As a consequence of spikes in food prices, the num- to develop a joint proposal on principles and best ber of people suffering from hunger increased by practices for international agricultural investment. 100 million up to 1 billion and could signifi ly cant Foster a more effi ent a c rent in erna t io l ci nd ohe t na worsen as the global economic crisis unfolds. agricultural and food security architecture by: ad- Lower incomes and higher unemployment reduce vancing the reforms of the FAO, the Committee the purchasing power of the poor, worsening their on World Food Security and other specialized access to food. The climate change impact on ag- agencies and their cooperation at global, regional riculture and decreasing availability of water could and country level; enhancing food aid effective- aggravate the already critical situation of food se- ness; continuing to explore various options on a curity, requiring broader adaptation and mitiga- coordinated approach to stock management; ad- tion efforts. vancing trade negotiations to achieve a balanced, comprehensive and ambitious conclusion of the In Toyako G8 agreed to undertake all possible Doha Round. Support country-led and regional measures to ensure global food security, highlight- processes, such as the Comprehensive Africa Ag- ing that the G8 had committed over US$ 10 bil- riculture Development Programme (CAADP), to lion since January 2008 for short, medium and promote sustainable agriculture, the development long-term purposes, to support food aid, nutrition of local markets and rural non-farm economies, interventions, social protection activities and ag- as well as to strengthen early warning systems, ricultural output increase. The monitoring report social protection mechanisms and safety nets for by their experts confi s th t from January 2 rm a 008 vulnerable population groups. to July 2009 US$ 13 billion have been disbursed and that substantial additional commitments have G8-Africa Partnership on Water and Sanitation: been undertaken since the Toyako Summit. G8 has determined to build a stronger partnership between African and G8 countries to increase With a view to ensuring a more food secure access to water and sanitation, based on the prin- world, G8 committed to: Stimulate sustainable ciples of shared responsibility and mutual account- growth of world food production, by promoting ability. Through the joint political weight of the increased investment in agriculture, including G8 and the AU, we will ensure adequate momen- through development assistance, and with particu- tum and commitment on water and sanitation lar attention to small-hold farmers; promote well- improvements at national and international lev- functioning and transparent international, national els, for concrete results on the ground. coordina- and local markets as a means to reduce the vola- tion processes and the defii tio o w ter a sani - n n f a nd tility of prices and combat speculation; work with tation investment plans in line with the Paris dec- governments and regional organizations to laration on Aid Effectiveness and the Accra strengthen national agricultural research systems; Agenda for Action. increase investment and access to scientifi k l - c now edge and technology, also by strengthening the To support the implementation of the African role of the Consultative Group for International commitments, G8 countries will: assist the build- Agricultural Research (CGIAR); encourage appro- ing of capacity in African countries to develop and priate land and natural resource management, the implement national water and sanitation plans; protection of biodiversity and the adaptation to improve coordination within multi-donor plat- Copyright © 2009 | WWW.UPSCPORTAL.COM 28

Section -1 (Article : 35th G-8 Annual Summit) forms to promote aid effectiveness; align assistance sion of the Round. to better refl n t io l p io ities ; im r ove b lat - ect a na r r p i eral and multilateral contributions to fi a nc i al n The time has come to intensify dialogue among mechanisms aimed at mobilizing investment; as- WTO Members with a view to fi di n sol u io n g t ns sist the AU Commission, AMCOW and Regional to the remaining negotiating gaps. The contribu- Economic Communities in response to the Afri- tion that countries are making in this Round is can demands for institutional support. G8 will con- unprecedented and all Members must be prepared tinue working at all levels to consolidate and de- to do the same, especially the developed ones. G5 velop this cooperation with a view to present a are ready to engage with all WTO Members with strengthened Africa-G8 Partnership on Water and a view to completing the modalities and address- Sanitation by the end of 2009. The Africa Water ing any outstanding problems, within the context Week due to take place in November in South of a transparent and inclusive multilateral process. Africa might provide an opportunity for tangible After consultations, Egypt has associated itself progress towards their common goal of meeting with this Declaration. water and sanitation challenges. Political Declaration: The Leaders of the Group G5 Trade and Political Declaration of Five (Brazil, China, India, Mexico and South Africa) have decided to issue the following Politi- Trade Declaration: The Leaders of the Group of cal Declaration: Five (Brazil, China, India, Mexico and South Af- rica) in L’Aquila, Italy on July 8, 2009, have de- The global economic crisis in its multiple dimen- cided to issue the following Declaration on Trade: sions, including social, employment and food and energy security risks, non traditional threats to Group of Five convinced that the successful con- security such as diseases and epidemics, as well as clusion of the Doha Round on the basis of its de- the challenges posed by climate change, under- velopment mandate will provide a major stimulus score our fundamental interdependence and the to the restoration of confi enc e in w r ld m rket s d o a imperative of enhancing cooperation to achieve and inhibit emerging protectionist trends which equitable and sustainable development for all. are particularly damaging to developing countries. The world needs a new global governance, the G5 also believed that a strengthened multilateral construction of which must be based on inclusive trading system must play a role in promoting de- multilateralism. In our evolving multi-polar world, velopment and reducing poverty. The full inte- the G5, as a positive platform that contributes to gration of developing countries in world trade re- the promotion of the interests of developing coun- quires a fair, equitable and development-friendly tries, will continue to actively engage in jointly multilateral trading system. tackling global challenges. G5 need to conclude this fi a l stage of n got ia- n e The recent outbreak of infl enz a A H N ) , a o u ( 1 1 l ng tions. The only way to achieve this in the fore- with its rapid spread to various countries all around seeable future is by upholding the mandates ne- the world, has further underscored the growing gotiated over the last seven years. The conclusion interconnection among people and countries. G5 of the modalities in agriculture and non-agricul- will continue monitoring the development of this tural market access (NAMA) continues to be a epidemic and facing it on the basis of constructive necessary step in the negotiations. The December dialogue and cooperation. 2008 draft Agriculture and NAMA texts must be completed in line with the development mandate Collectively, at the G-20 Summit held in London and their overall balance must be preserved, as last April, G5 stressed the need of addressing the they offer the only prospect for a timely conclu- global and fi a nc i al crisis in an in egrat ed m n- n t a Copyright © 2009 | WWW.UPSCPORTAL.COM 29

Section -1 (Article : 35th G-8 Annual Summit) ner, carefully considering its social and develop- effect of their policies. mental impacts, as well as the long term requirements of stability and sustainability. It is their G5 reaffi e d th i r com tm nt to m et in th rm e mi e e g e conviction that efforts to address food security, Millennium Development Goals and to contrib- energy security and other issues of common con- uting to poverty eradication and the promotion cern to developing countries, should not be re- of social development and justice at a global scale. duced because of the fi a nc i al c n risis. O th c n e on- In this regard, considering the threatening social trary, G5 must grab the crisis as an opportunity to impact of the global fi a nc i al and econom c cri- n i reform the international economic system for the sis, G5 urged developed countries to speedily meet benefi o a l, p t f l articul arly th m s t v n rabl e. A e o ul e s the already committed target of 0.7% of their gross a fi step, G c l for th fu l im l em nt at io o rst 5 al e l p e n f national income for offi al d ci evel o e nt a pm ssistanc e the G-20 London Summit Declaration without any to developing countries. Also, G5 emphasised the delay. importance of fully implementing the outcomes of major World Summits, especially the United At the global level, G5 must swiftly strengthen Nations Conference on Environment and Devel- macroeconomic policy coordination and adopt opment, the Monterrey Consensus and the strong economic stimulus measures to restore Johannesburg Plan of Implementation. This is also market confi enc e, stabi lize fianci al m ket s an d n ar d a necessary condition for global recovery. promote world economic growth. Developed countries have a leading responsibility in this re- G5 stressed the need for developing countries to gard. strengthen coordination and collaboration on outstanding global issues and call on all Governments, The G5 will continue to promote the reform of international organizations and relevant parties to the international fi a nc i al sys tem in a com r e- n p vigorously support South-South and trilateral co- hensive, balanced and result-oriented way, with operation, making full use of the existing mecha- the purpose of establishing a new international nisms to deepen cooperation in all fi d . A ex- el s n fi a nc i al or der w i ch is fai r, j u t, in l u iv and n h s c s e panded South-South cooperation can be supple- well-managed. In particular, we pledge to devote mentary but is not a substitute for North-South appropriate efforts to fundamentally resolving the cooperation. issue of under-representation and inadequate voice of developing countries in international fi a nc i al n G5 urged developed countries to assist the devel- institutions, which is urgently needed. Towards oping countries that are particularly vulnerable this end, the G5 will collaborate with other world to the adverse effects of climate change in meet- leaders. In this light, we welcome the outcome ing costs of adaptation. G5 also urged developed document adopted by the United Nations Con- countries to commit themselves to ambitious and ference on the World Financial and Economic comparable quantifi e i ssio reduct io target s ed m n n Crisis and its Impact on Development. by reducing their emissions in aggregate by at least 40% below their 1990 levels by 2020, in the sec- The promotion of equitable and sustainable de- ond commitment period of the Kyoto Protocol. velopment for all must be at the core of global efforts. G5 urged international fi a nc i al in titu n s - G5 were fully committed to working for an ambitions to use their recently augmented resources tious outcome at the 2009 United Nations Climate to mainly help those developing countries which Change Conference in Copenhagen, to ensure the have been seriously affected by the crisis. G5 also full, effective and sustained implementation of the called on all countries to consider the impact of Convention and its Kyoto Protocol. their macroeconomic policies on developing countries and avoid aggravating the diffi ties o d cul f e- Peace and development are mutually reinforcing. veloping countries due to the negative spillover Copyright © 2009 | WWW.UPSCPORTAL.COM 30

Section -1 (Article : 35th G-8 Annual Summit) The G5 will continue to support efforts that proof the other fi e count ries to a sum t in R m v mi a - mote global security based on international law, bouillet. There, they decided to hold the meet- and through constructive dialogue and diplomacy, ings annually, with each nation taking a turn to seek to strengthen the international legal frame- serve as host and chair. work. We remain committed to supporting the role of the United Nations in global governance The European Union is represented at the meet- and further undertake to intensify international ings, but does not act as host.Canada joined the cooperation, especially in the multilateral arena. group in 1976 to make it the G7, and Russia be- G5 will continue to strive for a comprehensive came a member in 1997 to form the G8. reform of the United Nations that includes strengthening the General Assembly, revitalizing G8 ministers meet many times during the course ECOSOC, reforming the Secretariat, strengthen- of the year. The fia nc e m n sters m et four tim s n i i e e ing the UN gender architecture and, in particular, a year, and the foreign ministers and environmen- achieving an early reform of the UN Security tal ministers meet less frequently.The annual Council, that properly refl s th cur rent eco- ect e holder of the G8 presidency sets the summit nomic and political realities. agenda in consultation with the other members, hosts the summit and determines which ministe- G5 unequivocally condemn in the strongest terms rial meetings will be held.In recent years, some terrorism in all its forms and manifestations. The members have pushed to expand the group’s size, global scourge of terrorism need strongest collec- and the Outreach Six (O6), which encompasses tive action by the international community to Brazil, China, India, Mexico, South Africa and prevent terrorist acts and punish perpetrators, fi- n Egypt, has been included in the G8 for talks. They anciers and others involved in such acts. In order will also be joined this year by Australia, Den- to provide a comprehensive international legal mark, Indonesia, South Korea, the Netherlands framework against terrorism, the UN member and Spain, Berlusconi said. states should conclude and adopt the Comprehen- sive Convention on International Terrorism as Berlusconi, who is chairing the 2009 forum, said early as possible. the G8 will also be attended by representatives of a number of international organizations, such as G5 reiterated their commitment to ensure a world the International Monetary Fund and World Bank, free of nuclear weapons and other weapons of mass and the African Union and representatives of some destruction and welcome the strengthening of African nations. Unlike many international orga- multilateral dialogue on disarmament issues. In nizations, such as the United Nations or NATO, particular, G5 supported the implementation of the G8 has no formal structure, no administrative the World Program of the Conference on Disar- staff or international headquarters or even a mail- mament for its 2009 sessions and expect a sub- ing address. It remains informal, but highly coop- stantive outcome of these meetings. erative and focused on coordination of action. What is G8 The 2009 summit held in L’Aquila, a city in the Abruzzo region of Italy, less than 100 kilometers The Group of Eight was created by France in 1975 (60 miles) east of Rome. The city was badly dam- as an informal forum for the six largest industrial- aged by an earthquake in April, and the Italian ized economies of the Northern Hemisphere — government decided to move the annual summit Britain, France, West Germany, Italy, Japan and there from La Maddalena on Sardinia to symbol- the United States. It was born out of the 1973 oil ize the rebuilding of the region. crisis and global recession.In 1975, French Presi- dent Valéry Giscard d’Estaing called the leaders Copyright © 2009 | WWW.UPSCPORTAL.COM 31

Section -1 (Article : 35th G-8 Annual Summit) Fact File G8 Countries: The members of the Group of Eight, or G8, are Canada, France, Germany, Italy, Japan, Russia, the United Kingdom and the United States. The eight members meet once a year at Heads of State and Government level. France, the United States and Russia are represented by their Heads of State, whereas the United Kingdom, Germany, Japan, Italy and Canada are represented by their respective Heads of Government. G5 Countries Over the years, the G7/G8 duty Presidencies have begun inviting a number of emerging countries to specific sessions of talks on an ad hoc basis, as the emerging economies’ increasing weight on the world scene has made it necessary to involve them in identifying solutions to the major global challenges. The Group of Five (G5) comprises Brazil,People’s Republic of china,India,Mexico and South Africa. Other Countries The purpose of the G8 – the main industrialised democracies’ forum for dialogue – is to come up with fresh answers to the main global political and economic issues. In addition to its traditional members, the Italian duty Presidency has invited to the G8 Sum- mit the countries that make up the Major Economies Forum, the NEPAD (New Partnership for Africa's Development) founder states, the representatives of the African Union and Spain, Turkey and the Netherlands. Other countries invited » Egypt » Hosni Mubarak, President MEF (Major Economies Forum) countries Australia: Kevin Rudd, Prime Minister Republic of Korea: Lee Myung-bak, President Indonesia: Susilo Bambang Yudhoyono, President Denmark (the country hosting next December’s UN Conference on Climate Change): Lars Lokke Rasmussen, Prime Minister Copyright © 2009 | WWW.UPSCPORTAL.COM 32

Section -1 (Article : Carbon Emissions Trading) Carbon Emissions Trading New Global Concept to Reduce Climate Change By Sangeeta Gupta Author is an Expert of Various Competitive Examinations India has planned to create the world's fi m r- rst a generated about 30 million carbon credits and is ket for trading credits for energy savings. Gov- one of the largest benefi aries in th c ci e arbon c t redi ernment expects to set mandatory energy-savings trade, according to MCX. Under the plan, private targets by the end of 2009 for energy-intensive companies would be responsible for measuring en- sectors such as cement, aluminium, steel, power, ergy reductions. textiles, fertilizers, railway, paper and pulp. The country's Bureau of Energy Effi enc y is w r ki n ci o g Carbon Trading Scenario on a program to establish credits for industrial plants that save energy beyond the government Parties with commitments under the Kyoto Pro- requirement. The plan has been modelled after tocol (Annex B Parties) have accepted targets for emissions-trading markets at work in the EU. limiting or reducing emissions. These targets are expressed as levels of allowed emissions, or “as- In January 2009, Mumbai, India-based Multi signed amounts,” over the 2008-2012 commitment Commodity Exchange period. The allowed (MCX) launched futures emissions are divided trading in carbon credits into “assigned amount in India. Under the en- units” (AAUs). Emis- ergy-savings plan, sepa- sions trading, as set out rate targets would be es- in Article 17 of the tablished for each large Kyoto Protocol, allows industrial unit and plant countries that have in order to take into ac- emission units to spare - count the different sizes emissions permitted and type of companies in them but not "used" - to each sector. The manda- sell this excess capacity tory reductions would to countries that are then go into effect three over their targets. Thus, years later. Companies a new commodity was surpassing energy savings requirements would get created in the form of emission reductions or re- credits that can be sold through existing power movals. Since carbon dioxide is the principal exchanges to companies that fail to meet their tar- greenhouse gas, people speak simply of trading in gets. Companies failing to meet targets that do not carbon. Carbon is now tracked and traded like any buy credits would then be penalized by the gov- other commodity. This is known as the "carbon ernment. The energy-savings market must be ap- market." proved by the prime minister's climate council. Trading Units: More than actual emissions units The move is part of India's National Action Plan can be traded and sold under the Kyoto Protocol’s on Climate Change. Because the country has lower emissions trading scheme. emissions than industrialized countries, India has decided one of its best contributions could be to The other units which may be transferred under use less energy from polluting sources. India has the scheme, each equal to one tonne of CO2, may be in the form of: Copyright © 2009 | WWW.UPSCPORTAL.COM 34

Section -1 (Article : Carbon Emissions Trading) » A removal unit (RMU) on the basis of land use, they reduce their emissions below their targets. land-use change and forestry(LULUCF) activities The presence of a market for these units creates a such as reforestation value for emissions reductions which stimulates investment in the most cost-effective areas. Emis- » An emission reduction unit (ERU) generated by sions trading leads to a reduction in compliance a joint implementation project costs compared to meeting the same target through domestic/internal means only. » A certifi e i ssion reduct ion (C ed m ER) g rat ed ene The Clean Development Mechanism (CDM) of the from a clean development mechanism project ac- Kyoto Protocol allows projects in developing coun- tivity. tries to generate emission credits if they result in emission levels lower than would otherwise be Transfers and acquisitions of these units are the case; these credits can be marketed and even- tracked and recorded through the registry systems tually counted against a developed country's emis- under the Kyoto Protocol. sion obligation. The IEA provides analysis on the effectiveness of the different emissions trading An international transaction log ensures secure scheme options, both at international and domes- transfer of emission reduction units between coun- tic level. tries. What is Emissions Trading? Commitment Period Reserve: In order to address Emissions trading is an administrative approach the concern that Parties could “oversell” units, and used to control pollution by providing economic subsequently be unable to meet their own emis- incentives for achieving reductions in the emissions targets, each Party is required to hold a mini- sions of pollutants. It is sometimes called cap and mum level of ERUs, CERs, AAUs and RMUs in its trade. national registry. This is known as the “commitment period reserve.” A central authority (usually a government or international body) sets a limit or cap on the amount Relationship to Domestic and Regional Emis- of a pollutant that can be emitted. Companies or sions Trading Schemes: Emissions trading other groups are issued emission permits and are schemes may be established as climate policy in- required to hold an equivalent number of allow- struments at the national level and the regional ances (or credits) which represent the right to emit level. Under such schemes, governments set emis- a specifi a o unt . T tot al a o unt o a lo a nc es c m he m f l w sions obligations to be reached by the participat- and credits cannot exceed the cap, limiting total ing entities. The European Union emissions trad- emissions to that level. Companies that need to ing scheme is the largest in operation. increase their emission allowance must buy credits from those who pollute less. The transfer of Emissions Trading and CDM allowances is referred to as a trade. In effect, the buyer is paying a charge for polluting, while the Emissions trading is a way of introducing fl b l- exi i seller is being rewarded for having reduced emis- ity into a system where participants have to meet sions by more than was needed. Thus, in theory, emissions targets. These participants may be coun- those who can easily reduce emissions most tries (as in the case of the Kyoto Protocol), or com- cheaply will do so, achieving the pollution reduc- panies (as in the case of a domestic emissions trad- tion at the lowest possible cost to society. ing scheme). Participants can buy units to cover any emissions above their targets, or sell units if There are active trading programs in several pol- Copyright © 2009 | WWW.UPSCPORTAL.COM 35

Section -1 (Article : Carbon Emissions Trading) lutants. For greenhouse gases the largest is the Eu- ropean Union Emission Trading Scheme. In the United States there is a national market to reduce International Emissions Trading acid rain and several regional markets in nitrogen Association (IETA) oxides. Markets for other pollutants tend to be smaller and more localized.The overall goal of an The International Emissions Trading Associa- emissions trading plan is to reduce emissions. The tion (IETA) is a nonprofit business organiza- cap is usually lowered over time - aiming towards tion created in June 1999 to establish a func- a national emissions reduction target. tional international framework for trading in greenhouse gas emission reductions. In other systems a portion of all traded credits must be retired, causing a net reduction in emissions Our membership includes leading international each time a trade occurs. In many cap and trade companies from across the carbon trading systems, organizations which do not pollute may cycle. IETA members seek to develop an emis- also participate, thus environmental groups can sions trading regime that results in real and purchase and retire allowances or credits and verifiable greenhouse gas emission reductions, hence drive up the price of the remainder accord- while balancing economic efficiency with ening to the law of demand. Corporations can also vironmental integrity and social equity. prematurely retire allowances by donating them to a non-profi ent ity and th n be el igi b e for a t e l As of March 2009, IETA comprises more than tax deduction. 160 international companies from OECD and non-OECD countries. IETA has formed sev- Because emissions trading uses markets to deter- eral partnerships such as with, among others, mine how to deal with the problem of pollution, the World Bank, Eurelectric, the World Busi- it is often touted as an example of effective free ness Council for Sustainable Development market environmentalism. While the cap is usu- (WBCSD) and the California Climate Action ally set by a political process, individual compa- Registry. nies are free to choose how or if they will reduce their emissions. In theory, fi s w ll choos e th rm i e Vision: IETA is dedicated to ensuring that the least-costly way to comply with the pollution objectives of the United Nations Convention regulation, creating incentives that reduce the cost on Climate Change and ultimately climate proof achieving a pollution reduction goal. tection are met through the establishment of effective systems for trading in greenhouse Background gas emissions by businesses, in an economically efficient manner while maintaining soci- The effi cacy of w a t lat er w s to be cal led th h a e etal equity and environmental integrity. "cap and trade" approach to air pollution abatement was fi d o ns trat ed in a series o m cro- rst em f i Legal Status and History: In 1999, IETA has economic computer simulation studies between emerged from the United Nations Conference 1967 and 1970 for the National Air Pollution Con- on Trade and Development (UNCTAD) Policy trol Administration (predecessor to the United Forums on greenhouse gas emissions trading, States Environmental Protection Agency’s Offi ce resulting from a co-operation between of Air and Radiation) by Ellison Burton and Wil- liam Sanjour. These studies used mathematical models of several cities and their emission sources in order to compare the cost and effectiveness of various control strategies. Each abatement strat- Copyright © 2009 | WWW.UPSCPORTAL.COM 36

Section -1 (Article : Carbon Emissions Trading) UNCTAD and the WBCSD. 3.Promote an integrated view of the emissions trading system as the solution to Climate IETA received legal non-profit status from the Change; government of Switzerland in June 2000, and received United Nations Framework Conven- 4.Participate in the design and implementation tion on Climate Change (UNFCCC) non-gov- of national and international rules and guide- ernmental organization accreditation in Octo- lines; and ber 2000. IETA currently has offices in Geneva (Switzerland), Ottawa (Canada), Brussels 5.Provide the most up-to-date and credible (Belgium) and Washington DC (USA). source of information on emissions trading and greenhouse gas market develop- Features: IETA consists of a diverse, inter- ments. national membership of business organizations. This ensures: egy was compared with the "least cost solution" 1. A wide range of expertise from representa- produced by a computer optimization program to tives of member companies including emitters, identify the least costly combination of source solution providers, brokers, verifiers and le- reductions in order to achieve a given abatement gal compliance; goal. 2.Interaction with the most active and cutting In each case it was found that the least cost solu- edge practitioners and stakeholders; tion was dramatically less costly than the same amount of pollution reduction produced by any 3.Representation of OECD and non-OECD conventional abatement strategy. This led to the interest; and concept of "cap and trade" as a means of achieving the "least cost solution" for a given level of abate- 4.The depth of the IETA network. ment. Goals and Objectives: IETA will work for: The development of emissions trading over the 1.The development of an active, global green- course of its history can be divided into four house gas market involving all three flexibil- phases: ity mechanisms of the Kyoto Protocol - the Clean Development Mechanism (CDM), Joint Gestation: Theoretical articulation of the instru- Implementation (JI) and Emissions Trading, ment (by coase, Crocker, Dales, Montgomery etc.) as well as those outside the Kyoto Protocol; and, independent of the former, tinkering with and "fl b e r exi l egul at io a th U E ronm nt al P o- n" t e S nvi e r tection Agency. 2. The creation of systems and instruments that will ensure effective business participation. Proof of Principle: First developments towards To be the premier voice for the business com- trading of emission certifi es b cat ased o th "of f- n e munity on emissions trading, the objectives for set-mechanism" taken up in Clean Air Act in 1977. the organization are to: Prototype: Launching of a fi "cap a trade" rst nd system as part of the US Acid Rain Program, officially announced as a paradigm shift in environ- Copyright © 2009 | WWW.UPSCPORTAL.COM 37

Section -1 (Article : Carbon Emissions Trading) mental policy, as prepared by "Project 88", a net- ticipating country, with the intention of reduc- work-building effort to bring together environ- ing their overall emissions by 5.2% of their 1990 mental and industrial interests in the US. levels by the end of 2012. Regime formation: branching out from the US clean air policy to global climate policy, and from Under the treaty, for the 5-year compliance pe- there to the European Union, along with the ex- riod from 2008 until 2012, nations that emit less pectation of an emerging global carbon market and than their quota will be able to sell emissions cred- the formation of the "carbon industry". its to nations that exceed their quota. It is also possible for developed countries within Cap and Trade versus Baseline and Credit:The the trading scheme to sponsor carbon projects that textbook emissions trading program can be called provide a reduction in greenhouse gas emissions a "cap and trade" approach in which an aggregate in other countries, as a way of generating trad- cap on all sources is established and these sources able carbon credits. The Protocol allows this are then allowed to trade amongst themselves to through clean development mechanism (CDM) determine which sources actually emit the total and joint implementation (JI) projects, in order to pollution load. An alternative approach with im- provide fl b e m cha ni sm to ai d regul at ed en- exi l e s portant differences is a baseline and credit pro- tities in meeting their compliance with their caps. gram. In a baseline and credit program a set of The UNFCCC validates all CDM projects to en- polluters that are not under an aggregate cap can sure they create genuine additional savings and create credits by reducing their emissions below a that there is no carbon leakage. baseline level of emissions. These credits can be purchased by polluters that do have a regulatory The Intergovernmental Panel on climate Change limit. Many of the criticisms of trading in general has projected that the fi a nc i al ef fect o com l i- n f p are targeted at baseline and credit programs rather ance through trading within the Kyoto commit- than cap type programs. ment period will be 'limited' at between 0.1-1.1% of GDP among trading countries. By comparison The Economics of International Emissions the Stern report placed the costs of doing nothing Trading:It is possible for a country to reduce emis- at fi e to 2 tim s h ghe r. v 0 e i sions using a command control approach, such as regulation, direct and indirect taxes. The cost of Renewable Energy Certifi es cat that approach differs between countries because the Marginal Abatement Cost (MAC) the cost of Renewable energy certifi es , o "green tags ", a cat r re eliminating an additional unit of pollution differs transferable rights for renewable energy within by country. It might cost China $2 to eliminate a some American states. A renewable energy pro- ton of CO2, but it would probably cost Sweden or vider gets issued one green tag for each 1,000 KWh the U.S. much more. International emissions-trad- of energy it produces. The energy is sold into the ing markets were created precisely to exploit dif- electrical grid, and the certifi es c b sol d o cat an e n fering MACs. the open market for additional profi T y are t. he purchased by fi s o in v d s in o der to id rm r di i ual r en- Kyoto Protocol tify a portion of their energy with renewable The Kyoto protocol is a 1997 international treaty sources and are voluntary. which came into force in 2005, which binds most developed nations to a cap and trade system for They are typically used like an offsetting scheme the six major greenhouse. (The United States is or to show corporate responsibility, although their the only industrialized nation under Annex-1 issuance is unregulated, with no national registry which has not ratifi a th ref or e is n b ed nd e ot ound to ensure there is no double-counting. However, by it.) Emission quotas were agreed by each par- it is one way that an organization could purchase Copyright © 2009 | WWW.UPSCPORTAL.COM 38

Section -1 (Article : Carbon Emissions Trading) its energy from a local provider who uses fossil within the Kyoto Protocol, the London fi a nc i al n fuels, but back it with a certifi e th t suppor ts a cat a marketplace has established itself as the center of specifi w n o h o p e r p oj ect . c i d r ydr ow r the carbon fia nce m rket , a is e n a nd xpected to h ve a grown into a market valued at $60 billion in 2007. Market trend:Carbon emissions trading has been The voluntary offset market, by comparison, is steadily increasing in recent years. According to projected to grow to about $4bn by 2010. the Word bank's Carbon Finance Unit, 374 million metric tonnes of carbon dioxide equivalent 23 multinational corporations came together in (tCO2e) were exchanged through projects in 2005, the G8 climate change roundtable, a business a 240% increase relative to 2004 (110 mtCO2e) group formed at the January 2005 World Eco- which was itself a 41% increase relative to 2003 nomic Forum. The group included Ford, Toyota, (78 mtCO2e). British Airways, BP and Unilever. On June 9, 2005 In terms of dollars, the World Bank has estimated the Group published a statement stating that there that the size of the carbon market was 11 billion was a need to act on climate change and stressing USD in 2005, 30 billion USD in 2006, and 64 bil- the importance of market-based solutions. It called lion in 2007. on governments to establish "clear, transparent, and consistent price signals" through "creation of The Marrakesh Accords of the Kyoto protocol de- a long-term policy framework" that would include fi e d th in erna t io l tradi n m cha ni sm and n e t na g e s all major producers of greenhouse gases. By De- registries needed to support trading between coun- cember 2007 this had grown to encompass 150 tries, with allowance trading now occurring be- global businesses. tween European countries and Asian countries. However, while the USA as a nation did not ratify Business in the UK have come out strongly in sup- the Protocol, many of its states are now develop- port of emissions trading as a key tool to mitigate ing cap-and-trade systems and are looking at ways climate change, supported by NGOs. However, not to link their emissions trading systems together, all businesses favor a trading approach. On De- nationally and internationally, to seek out the low- cember 11, 2008, Rex Tillerson, the CEO of est costs and improve liquidity of the market. Exxonmobil, said a carbon tax is "a more direct, However, these states also wish to preserve their more transparent and more effective approach" individual integrity and unique features. For ex- than a cap and trade program, which he said, "in- ample, in contrast to the other Kyoto-compliant evitably introduces unnecessary cost and complex- systems, some states propose other types of green- ity." He also said that he hoped that the revenues house gas sources, different measurement meth- from a carbon tax would be used to lower other ods, setting a maximum on the price of allowances, taxes so as to be revenue neutral. or restricting access to CDM projects. Creating instruments that are not truly fungible would in- The International Air Transport Association, troduce instability and make pricing diffi t. V ri- cul a whose 230 member airlines comprise 93% of all ous proposals are being investigated to see how international traffi p itio is th t tradi n sh d c, os n a g oul these systems might be linked across markets, with be based on “benchmarking,” setting emissions the International Carbon Action Partnership levels based on industry averages, rather than (ICAP) as an international body to help co-ordi- “grandfathering,” which would use individual nate this. companies’ previous emissions levels to set their future permit allowances. They argue Business Reaction:With the creation of a market grandfathering “would penalise airlines that took for mandatory trading of carbon dioxide emissions early action to modernise their fl s, w i le a eet h Copyright © 2009 | WWW.UPSCPORTAL.COM 39

Section -1 (Article : Carbon Emissions Trading) benchmarking approach, if designed properly, India and Emissions Market would reward more effi ent o ci perat io . " ns World wide trading in emissions added up to less Measuring, Reporting, Verifi io cat n than $400 million in 2008. But it is early days yet. (MRV) and Enforcement Turnover is growing rapidly, as is the price at which emissions are being traded. About 107 mil- Meaningful emission reductions within a trading lion tonnes of carbon dioxide equivalent (tCO2e) system can only occur if they can be measured at was exchanged in 2004 through `Kyoto Protocol' the level of operator or installation and reported projects, mostly purchased by rich countries in to a regulator. There is an open source tool for developing countries and in countries with econo- helping operators accurately measure and plan mies in transition; up 38 per cent compared to the their emissions. For greenhouse gases all trading 78 million tCO2e traded in 2003. It is estimated countries maintain an inventory of emissions at that 43 million tCO2e have been exchanged so far national and installation level; in addition, the this year. Prices for project-based emissions in- trading groups within North America maintain creased by 20-25 per cent over the last year. Veri- inventories at the state level through the climate fi E i ssio R duct io n trade a a w i g ed ed m ns e ns ow t e ht registry. For trading between regions these inven- average price of $4.22. Certifi E i ssio R duced m ns e tories must be consistent, with equivalent units tions command a premium of one dollar per and measurement techniques. tCO2e. In some industrial processes emissions can be To get at the total size of the emissions market, physically measured by inserting sensors and one must add trading in àllowance' markets to fl w t ers in chi m e ys and stacks , but m ny o me n a the fi e for p oj ect -based e i ssio . In th s fast gur r m ns i types of activity rely on theoretical calculations growing market, a company can sell whatever it for measurement. Depending on local legislation, saves from the total emissions quota allotted or these measurements may require additional checks auctioned to it by a public regulator. For example, and verifi io by governm nt or th rd party cat n e i under the EU's Emissions Trading System (ETS), auditors, prior or post submission to the local regu- European Governments have allotted greenhouse lator. gas emission allowances to individual companies and industries. If a company does not emit its to- Another critical part is enforcement. Without ef- tal allowance, it can trade the balance. Volumes fective MRV and enforcement the value of allow- exchanged on allowance markets have increased ances are diminished. Enforcement can be done dramatically this year as compared to 2004, and using several means, including fi e s o sanc t io n r n- are now reported to be comparable to volumes ing those that have exceeded their allowances. exchanged through project-based transactions. Concerns include the cost of MRV and enforcement and the risk that facilities may be tempted Apart from the EU ETS, three other active mar- to mislead rather than make real reductions or kets for greenhouse gas allowances have so far been make up their shortfall by purchasing allowances established. The UK Emissions Trading System, or offsets from another entity. The net effect of a the New South Wales trading system and the corrupt reporting system or poorly managed or Chicago Climate Exchange. The total amount ex- fi a nc ed regul at or m y b a d scount o e i ssio n a e i n m n changed on all allowance markets taken together costs, and a (hidden) increase in actual emissions. from January 2004 to March 2005 was about 56 million tCO2e. Thanks mainly to the coming into force of the EU's ETS from January 2005, volumes traded in the EU from January through March this Copyright © 2009 | WWW.UPSCPORTAL.COM 40

Section -1 (Article : Carbon Emissions Trading) year were 3.5 times higher than the allowances In the period from January 2003 to December exchanged in the 12 months of 2004. 2004, the share of India in total emission reduction projects of different sorts worldwide was 26 There is an increasing disconnect between the per cent, with the rest of Asia having a share of prices of carbon reductions from Joint Implemen- 17 per cent. India's share has since gone up a few tation and Clean Development Mechanism percentage points. The share of the rest of Asia projects under the Kyoto Protocol on the one has fallen slightly, but this has been offset by the hand, and on the other the prices at which allow- growth in total volume. In addition there are a ances are being traded under the EU's ETS. Trades large number of unilateral CDM projects that are in the latter market were priced between 7 and 9 under various stages of implementation in India. euros in 2004, but increased to 17 euros per tCO2e Since credits relating to the 60-70 projects in this in March and April 2005. category have yet to be sold they have not been included in the fi es m nt io d in th C rbon gur e ne e a According to the joint World Bank-International Report. Emissions Trading Association (IETA) report released two weeks ago `these two commodities are The US, which backed away from its commitment so different that they cannot be compared'. The to the Kyoto Protocol, predictably accounts for price differential, the report says, "could be ex- only a very small share of total project emissions plained by a number of factors including thin vol- purchased, around 3 to 4 per cent. The largest umes traded in allowances - resulting in high price buyers are Japan and the Netherlands in that or- volatility". The price differential could also reflect der, which account for 29 and 22 per cent of total the `risk inherent in project-based transactions'. purchases, respectively. The share of UK in total purchases has doubled recently and now stands at Projects abating non-carbon dioxide emissions ac- around 12 per cent. Other EU countries account count for more than half of the total volume of for 30-32 per cent of total purchases. emissions put up for sale. These include HFC23 destruction (which is the dominant type of emis- Emission trading rights: Developing countries in- sions reduction project in terms of volumes sup- cluding India have been absolved of any responsi- plied), projects capturing methane and N2O from bility towards reducing emissions in the fi c - rst om animal waste, and hydro, biomass energy and land- mitment period, 2008-2012, of the Kyoto Proto- fi g c u e p oj ect s. ll as apt r r col. This is not surprising as India’s per capita carbon dioxide emission is very low — only 1.21 HFC23 comes into being as a byproduct in the tonnes per annum, roughly one-fourth of the production of the hydrofl or ocarbon H C2 2, u F world average per capita emission of 4.50 tonnes which is used as a refrigerant and as a raw mate- per annum. rial for the production of fl or in t ed res in . It is a u a s very potent greenhouse gas: the release of one However, in aggregate terms, India is the fi - fth tonne of it in the atmosphere has the same long- largest emitter of fossil fuel-derived carbon diox- term effect on climate change as the release of ide, and its total emissions are growing rapidly. 11,700 tonnes of carbon dioxide. Not surprisingly, India is now under severe international pressure to accept binding commitments HFC23 destruction projects, all of which are lo- for emission reduction in the post-2012 phase of cated in Asia according to the State of the Carbon the Kyoto Protocol (KP). However, cuts in abso- Market Report, are few in number but account lute emissions are not only morally utterly unjust for very large volumes. It is mainly because of to impose on the part of the developed countries, these projects that Asia in general and India in but also practically suicidal for India to accept particular have such a large weight in total emis- them. But due consideration must be given to po- sion reductions in volume terms. Copyright © 2009 | WWW.UPSCPORTAL.COM 41

Section -1 (Article : Carbon Emissions Trading) tentially benefi al p icy in trum nt s, such as a ci ol s e Computable General Equilibrium (CGE) model. participation in an internationally tradable emission permits regime, or, what is alternatively re- In policy scenario 1, in which India takes part in ferred to as, a global cap-and-trade system of emis- global emissions trade with a fi ed q a o e i s- x uot f m sion permits. sion permits under GEA, it turns out to be a net buyer of tradable permits, and, consequently, suf- As of now the KP restricts emissions trading (ET) fers high cost through GDP diminution and pov- to occur within Annex B (developed) countries erty accentuation. (GDP and consumption losses only. The non-Annex B (developing) countries in the various years are in the range of 2%-5%, have been mere bystanders so far. But, it is most and the increases in the number of poor persons unlikely that the situation would remain that way. are in the range of 3.0%-7.5%.) Cumulative CO2 Already, the developing countries are having a emissions for the 30-year period decline by about major role to play in the ongoing PKP negotia- 5%. Annual per capita emissions which were al- tions on climate change, which would culminate ready (i.e., in the business-as–usual scenario) be- in the Conference of Parties-15 at Copenhagen in low the world average per capita emission decline December 2009. further in this scenario. If India were to participate in a global regime of Policy scenario 2 is concerned with India’s par- tradable emission permits, how would the conse- ticipation in global emissions trade under EPCEA. quences be affected by the different modes of Under this scheme, India, because of its emission entitlements? The two main types of increasing population, has an ever-increasing emissions allocation schemes are: quota of emission permits. However, it has sur- Grandfathered Emissions Allocation (GEA) plus emission permits to sell in the global market scheme in which permits are allocated on the ba- only till 2036. Till that time, the sale of permits sis of the aggregate emissions level of a predeter- results in fl w o trans fer p e nt s from res t o o f aym f mined year, say, 2010. the world to India enabling an expansion in investment in the domestic economy, which, in Equal Per Capita Emissions Allocation (EPCEA) turn, induces large gains in GDP, consumption and scheme in which the aggregate emissions entitle- poverty reduction. (GDP and consumption gains ments for India in different years are arrived at by in the various years are in the range of 6%-14%, multiplying the average global per capita emis- and decreases in the number of poor persons are sion (4.58 tonne per capita as estimated to be in in the range of 3%-12%.) 2010) with India’s population for the corresponding years. Cumulative emissions for the 30-year period rise by 7%-8%. However, annual per capita CO2 emis- It is well known that the developed countries sions remain below the 2010 world average of 4.58 favour the grandfathered emissions allocation tonne per capita but only up to 2036. Thereafter, scheme, while the developing countries — par- per capita emission surpasses the 2010 world av- ticularly, China and India — advocate the EPCEA erage causing a cessation of the trading benefi to t scheme. We evaluated three policy scenarios for India as it turns from being a seller to a buyer of India’s likely participation in a globally tradable internationally tradable emission permits. How- emission permits regime respectively under (1) ever, GDP, consumption and poverty alleviation GEA, (2) EPCEA, and (3) EPCEA plus enhanced continue to increase till 2040 though at a much energy effi enc y im r ovem nt for th p os pec- ci p e e r slower pace. tive 30-year period, 2010-2040, with respect to a business-as-usual or reference scenario, using a In policy scenario 3, India’s participation in glo- well-known tool of economic analysis, namely, a bal emissions trade under EPCEA is commingled Copyright © 2009 | WWW.UPSCPORTAL.COM 42

Section -1 (Article : Carbon Emissions Trading) with enhanced energy effi enc y i m r ovem nt ci p e ous science and the destructive impacts of projects (EEI) in the domestic economy. (It must be noted upon local peoples and environments as reasons that, India has an impressive track record for EEI why trading pollution allowances should be since 1980, and there remains substantial scope avoided. In its place they advocate making reduc- for EEI in the next 2-3 decades.) This consider- tions at the source of pollution and energy poli- ably amplifi th gai n achi eved in th scena rio es e s e cies that are justice-based and community-driven. 2, and the trading benefi to In a e ends till 2 t di xt 040, Most of the criticisms have been focused on the possibly even beyond. More importantly, these carbon market created through investment in gains are now accompanied by a decline rather Kyoto Mechanisms. Criticism of 'cap and trade' than a rise in cumulative and annual per capita emissions trading has generally been more lim- emissions. ited to lack of credibility in the fi p se o th rst ha f e EU ETS. It is obvious that, India will never participate in a future globally tradable emission permits regime Critics argue that emissions trading does little to inclusive of developing countries based on GEA. solve pollution problems overall, as groups that That would be tantamount to accepting manda- do not pollute sell their conservation to the high- tory emission reduction obligations — a sure est bidder. Overall reductions would need to come means to thwart our very developmental process. from a suffi ent a c l lengi n reduct io o a - ci nd ha g n f l Thankfully, the idea of predicating global emis- lowances available in the system.Regulatory agen- sions trade on an EPCEA criterion is gaining cies run the risk of issuing too many emission cred- ground. Under EPCEA, India’s gains through in- its, diluting the effectiveness of regulation, and ternational trade in emission permits would be practically removing the cap. In this case, instead substantial. of any net reduction in carbon dioxide emissions, benefi aries o e i ssio tradi n sim l y d m r e ci f m ns g p o o Further, if under a tradable emission permits re- of the polluting activity. The National Allocation gime based on EPCEA, the pace of energy effi - Plans by member governments of the European ciency improvement is also intensifi conc om - ed i Union Emission Trading Scheme were criticised tantly, not only do these gains get considerably for this when it became apparent that actual emis- augmented, but also there is a decline in carbon sions would be less than the government-issued emissions. In other words, by combining partici- carbon allowances at the end of Phase I of the pation in a global regime of tradable emission scheme.They have also been criticised for the prac- rights with faster energy effi enc y im r ovem nt , ci p e tice of grandfathering, where polluters are given not only does India reap a handsome climate policy free allowances by governments, instead of being dividend, but also contributes to mitigation of glo- made to pay for them. Critics instead advocate for bal warming. This is truly a win-win policy sce- auctioning the credits. The proceeds could be used nario. If India can work towards a scenario like for research and development of sustainable tech- this, it can actually transform a crisis into an op- nology. portunity. Critics of carbon trading, such as carbon trade Criticism watch, argue that it places disproportionate emphasis on individual lifestyles and carbon foot- There are critics of the methods, mainly environ- prints, distracting attention from the wider, sys- mental justice nongovernmental organizations temic changes and collective political action that (NGOs) and movements, who see carbon trading needs to be taken to tackle climate change. Groups as a proliferation of the free market into public such as the corner house have argued that the spaces and environmental policy-making. They market will choose the easiest means to save a level accusations of failures in accounting, dubi- given quantity of carbon in the short term, which Copyright © 2009 | WWW.UPSCPORTAL.COM 43

Section -1 (Article : Carbon Emissions Trading) may be different to the pathway required to obtain sustained and sizable reductions over a longer period, and so a market led approach is likely to reinforce technological lock-in. For instance small cuts may often be achieved cheaply through investment in making a technology more efﬁ ent , w e re larger c s w ul d ci h ut o require scrapping the technology and using a different one. They also argue that emissions trading is undermining alternative approaches to pollution control with which it does not combine well, and so the overall effect it is having is to actually stall signiﬁcant c nge to les s p lu in technol o es . ha ol t g gi The problem of unstable prices can be resolved, to some degree, by the creation of forward markets in caps. Nevertheless, it is easier to make a tax predictable than the price of a cap. However, the corresponding uncertainty under a tax is the level of emissions reductions achieved. More recent criticism of emissions trading regarding implementation is that old growth forests, which have slow carbon absorption rates, are being cleared and replaced with fast-growing vegetation, to the detriment of the local communities. Recent proposals for alternative schemes that seek to avoid the problems of Cap and Trade schemes include cap and share, which was being actively considered by the Irish Parliament in May 2008, and the Sky Trust schemes. ADVERTISEMENT Buy Online: http://upscportal.com/store/tag/upkar-prakashan Copyright © 2009 | WWW.UPSCPORTAL.COM 44

Section -1 (Article : Economic Survay 2008-09) Economic Survey 2008-09 India Showed Sign of Recovery in Recession Period By Avadhesh Pandey Author is an Expert of Economic and political Issues and working as a Freelance Editor The Economic Survey 2008-09 presented to Parlia- in the labour market and some decline in employment on july 2,2009 by the Finance Minister Shri ment. Thirdly, cutbacks in consumer credit by pri- Pranab Mukherjee. According to it, the speed at vate banks, NBFCs and other lenders. Fourthly, dur- which the Indian ing slowdown a domi- economy returns to the nance of precautionary high growth path in the motive may induce con- short term depends on sumer to either defer the revival of the their spending decisions economy, particularly or shift to unbranded al- the US economy and the ternatives. Government’s capacity The Survey goes on to to push some critical note that there are early policy reforms in the signs of recovery in the coming months. It said, global economy mani- if the US economy bot- fested in rising stock toms out by September prices and increasing 2009 there would be price of commodities. It good possibility for the is however, debatable Indian economy repeat- whether rising prices are ing its 2008-09 performance i.e. around 7.0 +/- 0.75 an indication of green shoots of recovery or a result per cent in the fiscal 2009-10 (assuming a normal of position taken by financial investors seeking to monsoon). However, in the event of a more pro- benefit from global recovery expectations. Though longed external economic downturn, the revival of the financial crisis and the transmission of its impact the global economy/US economy being delayed un- on the real economy is now better understood and til 2010, the growth may moderate to the lower end global financial conditions have shown improvement of the range. The recovery is likely to be assisted by over the recent months, uncertainty related to the the likely developments in the external sectors. The revival of the global economy remain. That makes it declining trend in trade deficit suggests that with rea- difficult to forecast the short-to-medium term growth sonable invisible account surplus, which has been an prospects of the Indian economy. attribute of Indian economy for the last several years economy may end up with a current account surplus According to Survey, counter the negative fall out of 0.3 to 2.8 per cent of GDP in 2009-10. of the global slowdown on the Indian economy, the Government responded by providing substantial fis- The Survey said, the prospects of Indian economy cal expansion in the form of tax relief to boost de- are somewhat different from most other countries. A mand and increased expenditure on public assets. The large domestic market, resilient banking system and net result was an increase in fiscal deficit from 2.7 a policy of gradual liberalisation of capital account per cent in 2007-08 to 6.2 per cent of GDP in 2008- have been key factors. A major concern at this stage 09. The difference between the actuals of 2007-08 though not entirely unexpected is a sharp dip in the and 2008-09 constituted the total fiscal stimulus not growth of private consumption. Four factors seem withstanding that some expenditure was on account to have contributed to this slowdown. First, it could of implementation of the Sixth Pay Commission be due to the wealth effect, resulting from decline in Award and the Agriculture Debt Relief Scheme an- the equity/property prices. Secondly, the uncertainty nounced in 2008-09 Budget. Copyright © 2009 | WWW.UPSCPORTAL.COM 45

Section -1 (Article : Economic Survay 2008-09) Despite the slowdown in growth, investment remained relatively buoyant growing at a rate higher than at the rate of the GDP. The ratio of the fixed investment to GDP consequently increased to 32.2 per cent in 2008-09 from 31.6 per cent in 2007-08. This reflects the resilience of Indian enterprise, in the face of massive increase in global uncertainty and risk aversion and freezing of highly developed financial markets. Domestic food price inflation as measured by the Wholesale Price Index (WPI) food sub index, though declining remains much higher Salient Features » Economic growth decelerates to 6.7 per cent in 2008-09 compared to 9 per cent in 2007-08 and 9.7 per cent in 2006-07. » Per capita growth at 4.6 per cent. » Deceleration in growth spread across all sectors except mining and quarrying; agriculture growth falls from 4.9 per cent in 2007-08 to 1.6 per cent 2008-09. » Manufacturing grows at 2.4 per cent, slowdown attributed to fall in exports and a decline in domestic demand. » Global financial meltdown and economic recession in developed economics major factors in India’s economic slowdown. » Investment remains relatively buoyant, ratio of fixed investment to GDP increased to 32.2 per cent in 2008-09 compared to 31.6 per cent in 2007-08. » Fiscal deficit to GDP ratio stands at 6.2 per cent. » Credit growth declines in the later part of 2008-09 reflecting slowdown of the economy in general and the industrial sector in particular. » Increased plan expenditure, reduction in indirect taxes, sector specific measures for textile, housing, infrastructure through stimulus packages provides support to the real economy. » Merchandise export grows at a modest 3.6 per cent in US Dollar terms while overall import growth pegged at 14.4 per cent. » A large domestic market, resilient banking system and a policy of gradual liberalisation of capital account to help early mitigation of the adverse effect of global financial crisis and recession. » Sharp dip in the growth of private consumption a major concern at this stage. » Medium to long-term capital flows likely to be lower as long as the de-leveraging process continues in the US economy. » Revisiting the agenda of pending economic reforms imperative to renew the growth momentum. Copyright © 2009 | WWW.UPSCPORTAL.COM 46

Section -1 (Article : Economic Survay 2008-09) than overall inflation. power, decontrol of coal also need to be addressed to have a viable long-term solution to our depen- The Survey expressed, concern over the existence dence on foreign oil and the debilitating effect of of hunger and widespread malnutrition despite the power failure. country achieving self-sufficiency in food production and with mounting public food stocks at its com- The Survey said although the economy continues to mand. It is time that various interventions at the State face wide ranging challenges-the Indian economy has and Central level addressing these issues are reviewed shock absorbers that will facilitate early revival of and redesigned. India continues to retain its position growth. The banks are financially sound and well as a preferred destination for investments. A recent capitalised, foreign exchange position remains com- study by UNCTAD found that India achieved a fortable and the external debt position has been within growth of 85.1 per cent in foreign direct investment comfortable zone. The rate of inflation provides a flows in 2008, the highest increase across all coun- degree of comfort on the cost side for the produc- tries. According to the study FDI investments into tion sectors. Agriculture and rural demand contin- India went up from US Dollar 25.1 billion in 2007 to ues to be strong and agricultural prospects are nor- US Dollar 46.5 billion in 2008, even as global flows mal. The Survey says while there are indications that decline from US Dollar 1.9 trillion to US Dollar 1.7 the economy may have weathered the worst of the trillion during the period. downturn, the situation warrants close watch on vari- While fiscal policy plays a dual role as a short-term ous economic indicators including the impact of the counter-cyclical tool and an instrument to maintain economic stimulus and developments taking place microeconomic stability and promote growth in the in the international economy. Taking policy measures medium term, the Economic Survey underlines the that squarely address the short and long term chal- need to restore Centre’s fiscal deficit to the FRBM lenges would achieve tangible progress and ensure target of 3 per cent of GDP at the earliest. It says a that the outlook for the economy remains firmly posi- number of factors will make it possible. They include tive. reversal of much of the decline in business and corporate tax collections when growth accelerates from Trade Sector in 2009: The Economic Survey for the second half of the year and the expected intro- 2008-09 said that the outlook for the trade sector in duction of GST in 2010-11. On the monetary policy 2009 is not very encouraging with IMF projecting a front the Survey says that high deposit rates have negative growth in world output at -1.3 per cent and now come in the way of cutting lending rates at a world trade volume projected to growth at -11 per pace which is consistent with the current outlook on cent. With import demand falling from major trading inflation and the need for stimulating investment de- partners from India’s export of goods and services is mands. expected to be impacted. The steep fall in petroleum and commodities prices could have a positive im- Reflecting on the high oil and other energy prices, pact in the import side and for the industrial sector. the Survey says that as long as domestic prices re- In 2010, recovery is expected with IMF projections mained below the cost of imports, demand would at 1.9 per cent for world output and 0.6 per cent for continue to grow, accentuating the negative impact World trade volume of goods and services. of the terms of trade effect on national income. Re- ferring to the volatility of global oil prices, it says, The subdued global outlook calls for efforts at both the fall could be a temporary respite and provides a national and international levels to revive growth. golden opportunity to reform the pricing and con- While efforts to promote exports are needed, the trol system. As the low prices of oil has provided a Economic Survey emphasises the need to guard temporary window for decontrol of petrol and die- against protectionist measures originating from our sel, this window must be utilised at the earliest. Other trade partners. The Survey says, we also need to elements of energy policy such as open access to desist from any protectionist tendencies and proceed Copyright © 2009 | WWW.UPSCPORTAL.COM 47

Section -1 (Article : Economic Survay 2008-09) on the reform path. Besides short-term relief mea- The credit flow to the farm sector kept up the mo- sures and stimulus packages, some fundamental mentum as envisaged in the Farm Credit Package policy changes are needed. For the merchandise trade announced in June 2004. Accordingly, the farm credit sector these include continuation of the reduction in flow during 2008-09 increased to 2,64,455 crore, customs and excise duty to make our exports and up from Rs. 2,54,657 crore in 2007-08. The Survey industry competitive, streamlining of existing export emphasizes number of steps taken by the Govern- promotion schemes, giving special attention to ex- ment to enhance credit support to farmers. In this port infrastructure alongwith rationalisation of port context the Survey mentions role of Kisan Credit service charges, weeding out unnecessary customs Cards, revival of short terms rural co-operative credit duty exemptions and checking the proliferation of structure through signing of MOU between the States SEZs. and Government of India-NABARD, agriculture debt waiver and debt relief scheme 2008 etc. Under reha- In the services sector a road map of specific policies bilitation package for distress farmers for 31 suicide needs to be drawn not only to overcome the impact prone districts, in 4 States of Andhra Pradesh, of the current global crisis, but also to accelerate the Karnataka, Kerala and Maharashtra, Government of growth of our economy and the total exports as this India has released Rs. 15,889.02 crore as on 31st sector has been showing a steady and promising per- March, 2009. formance with relatively lesser support. The Minimum Support Prices (MSP) for Kharif crops Food grain production 2008-09: The Economic were raised substantially in 2008-09 and similarly Survey for 2008-09 has put the production of MSPs of Rabi crops of 2008-09 ( to be marketed in foodgrains at 229.85 millions tones during 2008-09 2009-10) were also raised. The higher MSP for Rabi in accordance with the third advance estimates for Marketing Season (RMS) 2008-09 lead to a record the year. This is an improvement of 1.97 million tones procurement of 22.68 million tones of wheat. The over the production estimated in the second advance procurement of rice in the financial year 2008-09 too estimate for 2008-09. However, the output at this was significantly higher at 32.8 million tones as com- level is marginally lower than the final estimates of pared to 26.3 million tones in 2007-08. The Survey 230.78 million tones for 2007-08. points out that the procurement of foodgrains by FCI continues to be higher in the States of Punjab, The production of rice was 99.37 million tones in Haryana, Uttar Pradesh and Andhra Pradesh. The 2008-09 which is 2.8 per cent more than the pro- overall procurement of coarse grains in Kharif Mar- duction in the previous year. The survey said that keting Season till 31st March, 2009 has increased to increase in production of rice was mainly on account 11.18 lakh tones from 2.04 lakh tones in 2007-08 of Kharif season output growth of 3.4 per cent over due to highly remunerative MSPs. Elaborating per- the corresponding period of previous year. The pro- formance under decentralize procurement scheme duction of Rabi rice is estimated to be lower by about (DCP), the Survey observes that the States under 0.9 per cent in 2008-09. The wheat production, ac- DCP operations have shown a healthy increase in cording to the Economic Survey, is expected to be procurement of rice. The downward trend in pro- marginally lower by 1.2 per cent at 77.63 million curement of wheat has been arrested in RMS 2008- tones in 2008-09. The Economic Survey also under- 09. scores a growth in area sown under all Rabi crops taken together as on 27th March 2009. Accordingly Food subsidy during 2008-09 has increased to Rs. an area of 638.33 lakh hectares has been reported to 43,668 crore (provisional) during 2008-09 record- be sown under Rabi crops in 2008-09 against 619.68 ing an increase of 40 per cent over the subsidy of Rs. lakh hectares in the corresponding period of 2007- 31,260 crore in 2007-08. The Survey observes that 08. The area sown under Kharif crops during 2008- a total amount of subsidy as continued to rise at the 09 was however, lower by 2.3 per cent as compared national level. It points out that a provision of mini- to 2007-08. mum nutritional support to the poor through subsi- dized foodgrains and ensuring price stability in dif- Copyright © 2009 | WWW.UPSCPORTAL.COM 48

Section -1 (Article : Economic Survay 2008-09) ferent states are twin objectives of the food security ing of the international financial situation and the system. “ In fulfilling its obligation towards distribu- global economic outlook. The year 2008-09 thus tive justice, the Government incurs food subsidy” closed with the industrial growth at only 2.4 per cent the Survey adds. as per the Index of Industrial Production. The slowdown in manufacturing over successive quarters Referring to the challenges and future outlook the started from Q1 of 2007-08. This was more or less Economic Survey underlined a clear need for the replicated by the mining sector and closely followed renewed focus on improving productivity in specially by electricity. However, in the third quarter of 2008- in the light of limitations on increasing net sown area 09, the manufacturing sector witnessed a sharp drop and the shrinking farm size. It also calls for main- in growth which turned negative in the fourth quar- taining current focus on developing rural infrastruc- ter. Growth of the mining sector declined over suc- ture like rural roads for providing connectivity which cessive quarters of 2008-09 to reach a zero rate in is essential for movement of agricultural produce. the fourth quarter. Stating that the irrigation sector requires thrust in terms of investment and modern management, the The increase in the price of imported crude was Survey underscores a need for development of mi- passed on into the domestic market in June 2008, cro irrigation system and watersheds. It also but, in a very limited way through a hike in the price emphasises the need for narrowing kept between the of motor spirit, HSD and LPG. However, the persis- producer prices and consumer prices, development tent rise in the price of crude had started to impact of marketing infrastructure and storages and ware- petro-based industrial inputs adding to fuel costs. houses, cold chains and modern technology driven That apart, the rise in the price of other commodi- spot markets. ties, particularly metals and ores from the latter half of 2006-07 to the second half of 2008-09 also had The Survey also stated farmers needs to be facili- its effect on the cost side of the manufacturing sec- tated for taking up value additions such as process- tor. Growth in production of capital goods contin- ing of agricultural produce, horticulture, pisciculture, ued at a robust pace reflecting perhaps the high in- poultry etc. In order to ensure benefits accruing to vestment rates. However, with the decline in the the targeted population, the Survey called for a mis- growth of intermediate goods (with a weight of 26.5 sion approach on promotion of Smart Cards with its per cent) from Q 1 of 2008-09, the growth in overall cross reference to ration cards and voter ID cards. It Iip showed a sharp dip that got accentuated in Q3 of also invited attention to the issues of sustainability 2008-09 when the remaining groups also showed a of agriculture in the light of environmental concerns sharp drop in growth. like soil erosion, water logging, reduction in ground water level and decline in surface irrigation. The The broad growth correspondence between the two- Survey stressed that the consequences of climate digit level industrial groups and the use-based in- change on Indian agriculture needs to be factored in dustry groups can be established by juxtaposing the the strategy for development of agricultural sector. former against the latter. The growth in consumer non-durables has been boosted by the high growth Industrial output 2008-09 : Though the growth of in beverages and tobacco products, while the other the industrial sector started to slowdown in the first major components-food products, chemicals and half of 2007-08, the overall growth during the year leather products showed sluggish/negative growth. remained as high as 8.5 per cent. The industrial sec- The growth in basic goods is closely aligned to that tor witnessed a sharp slowdown during 2008-09 as in electricity and mining that constitute substantial a consequences of successive shocks, the most impart of the weight of basic goods; the most of the portant being the knock-on effects of the global fi- rest are chemical products, rubber, plastic and pe- nancial crisis. The pace of slowdown accelerated in troleum products and steel. Intermediate goods are the second half of 2008-09 with the sudden worsen- Copyright © 2009 | WWW.UPSCPORTAL.COM 49

Section -1 (Article : Economic Survay 2008-09) a more dispersed group dominated by chemical, tex- during the year included TV receivers, diesel engines, tile, rubber, metal product intermediates, most of industrial machinery, turbines, hydraulic machines and which experienced negative growth in 2008-09. cylinders, boilers, power-driven pumps, electric gen- While the high growth of machinery and equipments erators, cooling towers, cutting tools and dumpers. bolstered the growth of capital goods, the poor to The year 2007-08 was marked by substantial growth average performance of transport equipments damp- in the revenue of IT-ITeS industry, BPO, software ened the overall growth of capital goods. and services exports and software and services employment. However, the expected growth in 2008- The growth in any industrial group is determined by 09 is significantly lower when compared to 2007- the level of production during the current period and 08. the base level. A simple classification of IIP groups in terms of their growth rates reveals that only two Production of the automotive industry grew at a out of 17 industrial groups-beverages and tobacco CAGR of 11.5 per cent over last five years. The in- and machinery-grew at robust rates during 2008-09 dustry has a strong multiplier effect on the economy despite a high base. Seven of the 17 groups showed due to its deep forward and backward linkages with low growth ranging between 5 per cent to Nil. Of several key segments of the economy. There are posi- these, three groups (miscellaneous manufacturing, tive signs that the Indian industry may have weath- basic metals and alloys and chemicals and chemical ered the most severe part of the shock and is now products) had a high base in the previous year. Of moving towards a recovery. Some of the positive the eight industrial gro8ups that witnessed a decline signs are the recent upturn in the generation of elec- in production during 2008-09, the high base factor tricity, the improvement of cement dispatches and was significant only for three items- leather prod- rise in the offtake of bank credit. ucts, wood products and jute textiles. In general, it can therefore be said that 2008-09 was character- India has a large domestic market with immense ab- ized by a decline in growth largely on account of a sorptive capacity for industrial goods as also inputs slowdown rather than due to a high base in the pre- for the development of the infrastructure implies that vious year 2007-08. the demand side provides scope for expansion. At this juncture, when the prospect for industrial out- India ranks as the fifth largest producer of steel in put and prices in most industrial economies seem to the world. The crude steel production grew at an be grim, the configuration of prices, output and mar- annual rate of 9.2 per cent during 2003-04 to 2007- ket size makes the Indian industry one of the few 08. The increase in production came on the back of attractive destinations for investment, the Survey capacity expansion, mainly in the private sector adds. plants, and higher utilization rates. Metal products industry suffered from the second consecutive year Central Government expenditure 2008-09: The Eco- of decline; its index of production declined by 5.6 nomic Survey for 2008-09 shows that the Govern- per cent in 2007-08 and further by 4 per cent in 2008- ment has been increasing its outlays in the social sec- 09. tor substantively. The Economic Survey 2008-09, tabled in Parliament today states that the share of The machinery sector (except the transport equip- the Central Government’s expenditure on social ser- ment) grew at 8.7 per cent during 2008-09, on the vices including rural development in total expendi- top of five consecutive years of growth in excess of ture (plan and non-plan) has increased from 11.23% 10 per cent. In terms of contribution to the growth in 2002-03 to 19.44% in 2008-09. Expenditure on of the sector, the bulk was accounted for by insu- education as a proportion of total expenditure has lated cables and wires, the production of which more increased from 9.5% in 2003-04 to 10.8% in 2008- than doubles, as per IIP during 2008-09. The other 09. However the reach of public and quasi public important items that recorded significant growth goods and services supplied by the State to people Copyright © 2009 | WWW.UPSCPORTAL.COM 50

Section -1 (Article : Economic Survay 2008-09) still shows leakages in the schemes and the benefits increase in the access to sanitation facilities by rural in full do not reach the targeted groups. households. The sanitation coverage among rural households has increased from 21.9 percent in 2001 The Survey stated that the Government has approved to 27.3 percent in 2004 and has more than doubled the constitution of UID Authority of India (UIDAI). since then to 63.91 per cent (of 2001 Census house- The initial UID database would be created using the holds) as on May 20, 2009. The total Sanitation electoral rolls database of the Election Commission Campaign (TSC) is one of the eight flagship of India. While some innovative measures have been programmes of the Government. TSC projects have initiated in NREGS to bring in more transparency been sanctioned in 593 rural districts of the country and plug leakages, UID number would help greatly at a total outlay of Rs. 17,885 crore with a Central in proper targeting and ensuring services reaching share of Rs. 11,094 crore. Since 1999, over 5,56 crore the intended beneficiaries of the Government toilets have been provided for rural households un- programmes and hence serve as the basis of efficient der TSC. A significant achievement has also been delivery of services. Based on a Unique ID number the construction of 8.71 lakh school toilets and 2.72 (UID) and associated information all residents should lakh Anganwadi toilets. With increasing budgetary be entitled to a smart card containing specified un- allocations and focus on rural areas, the number of changeable data. Entitlements would then need to households being provided with toilets annually has be based upon the data contained in the smart card increased from only 24,41 lakh in 2002-03 to 98.7 and services/subsidies/entitlements received would lakh in 2006-07. also be recorded against this card. Pradhan Mantri Gram Sadak Yojana: PMGSY Social Sector Initiatives is funded mainly from the accruals of diesel cess in the Central Road. Upto March 2009, a total length The Economic Survey stated that in consonance with of about 2,14,281,45 kilometres of roadwork has the Government’s commitment to inclusive growth been completed with cumulative expenditure of Rs. and faster social sector development to remove dis- 46,807.21 crore. parities, substantial progress has been made by the Central Government on some of the major social Swarnajayanti Gram Swarozgar Yojana: It is the sector initiatives during the year. Bharat Nirman has only self-employment programme currently being received an outlay of Rs. 40,900 crore in the interim implemented for the rural poor. Up to March 2009, budget for 2009-10 as against Rs. 31,280 crore (in- 34 lakh self help groups (SHGs) had been formed cluding NER component) in 2008-09. Up to March and 120.89 lakh swarozgaris have been assisted with 2009, a total length of 2,14,281,45 kilometres of road a total outlay of Rs. 27,183.03 crore. works has been completed under the Pradhan Mantri Gram Sadak Yojana (PMGSY) with a cumulative Swarna Jayanti Shahari Rozgar Yojana: The fund expenditure of Rs. 46,807.21 crore. allocation for the scheme was Rs. 515 crore during 2008-09 and Rs. 540.67 crore has been released up National Rural Employment Guarantee Scheme: to March 31, 2009. With regard to the number of The scheme has now been extended to all the dis- beneficiaries during 2008-09 9,47,390 urban poor tricts of the country. More than 4.47 crore house- were assisted to set up individual/group micro en- holds were provided employment in 2008-09. This terprises and 14,84,209 urban poor were imparted is a significant jump over the 3.39 crore households skill training under SJSRY as per the progress recovered under the scheme during 2007-08. Out of ports received up to the end of March 31, 2009. the 215.63 crore person-days created under the scheme during this period, 29 percent and 25 percent were in favour of SC and ST population. Education: The Sarva Shiksha Abhiyan (SSA) is being implemented in partnership with State Govern- Rural Sanitation: There has also been tremendous ments to address the needs of children in age group Copyright © 2009 | WWW.UPSCPORTAL.COM 51

Section -1 (Article : Economic Survay 2008-09) of 6-14 years The Economic Survey for 2008-09 for 792 additional projects, 2.13 lakh additional tabled in Parliament today states that the achieve- Anganwadi Centres (AWCs) and 77,102 mini-AWCs ments of SSA till December 2008 are opening of and a proposal for 20,000 AWCs on demand has also 2,76,903 new schools, construction of 2,25,383 been approved in October 2008 and administrative school buildings, construction of 9,18,981 additional sanctions have been issued to all states/Uts. This classrooms, 1,82,019 drinking water facilities, con- would take the total number of Anganwadi Centres struction of 2,51,023 toilets, supply of free textbooks to 14 lakh across the country with special focus on to 8.40 crore children appointment of 9.66 lakh teach- coverage of SC/ST and minority population. The fi- ers and in-service training for 23.82 lakh teachers. nancial norms for supplementary nutrition have been There has been a significant reduction in the number revised from Rs. 2.06 to Rs. 4.21 per beneficiary. of out-of-school children on account of SSA interventions. Following are instances of some of the ex- Strengthening of Primary Health Infrastructure: The pansion of higher educational institutions as per the National Rural Health Mission(NRHM) seeks to Survey: strengthen the public health delivery system at all levels in the country. It is being operationalised An ordinance has been promulgated under Article throughout the country. The Economic Survey for 123 of the Constitution for establishment of 15 Cen- 2008-09 tabled in Parliament today states that as part tral Universities including the conversion of three of the NRHM 6.49 lakh ASHAs and link workers State Universities into Central Universities – one in have been selected upto December 2008 out of which each such state which does not have a Central Uni- 5,63 lakh have been given orientation training and versity, except Goa, which has not been included at 4.12 ASHAs have drug kits. Strengthening of the the request of the State Government. PHCs for 24x7 services is a priority of the NRHM. Of the 22,370 PHCs in the country, only 1,263 of Six new Indian Institutes of Technology (IITs), one them were working 24x7 on March 31, 2005 (be- each in Bihar, Andhra Pradesh, Rajasthan, Orissa, fore the NRHM). The number of 24x7 PHCs today, Gujarat and Punjab have been set up during 2008- as reported by the states is 7,212 signifying a big 09. Classes have also been started from the academic leap forward in getting patients to the government session 2008-09. One new Indian Institute of Man- system. agement (IIM) namely the Rajiv Gandhi Indian In- stitute of Management (RGIIM) at Shillong in Over 159,92 lakh women have been brought under Meghalaya has started functioning from the academic the Janani Suraksha Yojana for institutional deliver- session 2008-09. Two new Indian Institutes of Sci- ies in the last three years. So far, 8,645 other para- ence Education & Research (IISERs) have been set medics have been appointed on contract. 9,073 doc- up at Bhopal and Thiruvananthapuram, which have tors, 1,875 specialists, 20,977 staff nurses have been started functioning with the academic session 2008- appointed on contract in the states so far, reducing 09. the human resource gaps in many institutions. In- dian Public Health (IPH) Standards have been A new Scholarship Scheme has been started to cover finalised and a first grant of Rs. 20 lakh was made top 2 per cent of the student population of Class XII available to all the district hospitals of the country to (equally divided between boys and girls on the basis improve their basic services, given the increased pa- of Class XII results) by providing them with schol- tient load due to JSY and other programmes. So far arship of Rs. 1,000 per month for 10 months in a 243 Mobile Medical Units are operational in the year for the first three years of undergraduate level states. studies and Rs. 2,000 per month for 10 months in a year for subsequent 2 years. As per the Economic Survey, in the National AIDS Control Programme, major achievements during The Economic Survey also showed that the proposal 2008-09 include scaling up targeted interventions for for the third phase of expansion of the ICDS scheme high risk groups to 1,271, counselling and HIV test- Copyright © 2009 | WWW.UPSCPORTAL.COM 52

Section -1 (Article : Economic Survay 2008-09) ing 101 lakh persons of which 41.5 lakh were preg- tures among backward sections of the minority com- nant women and providing ARV treatment to more munities. than 2.17 lakh patients. Under the Aam Admi Bima Yojana, upto December Social Welfare Schemes 31, 60.32 lakh people have been covered. Another major Governmental scheme for social protection, The Economic Survey stated that the Government is the Rashtriya Swastha Bima Yojana was extended committed towards social and economic uplift of the to 22 states and Union Territories upto May 6, 2009. weaker sections of society. As regards the Sched- Through this scheme, health insurance cover has been uled Castes a number of schemes are being imple- given to more than 2.09 crore persons. mented to encourage Scheduled Caste students for continuing their education from school level to higher National Action Plan on Climate Change education. The earlier Centrally-sponsored scheme of hostels for SC boys and girls was revised and re- The Economic Survey stated that India holds that named as “Babu Jagjivan Ram Chhatravas Yojana’ the planetary atmospheric space is a common re- w.e.f. January 1,2008. As part of this revision, Cen- source. It says that in tackling the challenge of cli- tral assistance for construction of girls’ hostels was mate change, both production and consumption pat- raised from 50 per cent. During 2008-09, the physi- terns need to be addressed, with the willingness to cal target under the scheme was to construct 64 hos- address lifestyle issues. Availability and/or dissemi- tels for 4,938 girls and 45 hostels for 3,138 boys. An nation of existing climate friendly technologies and amount of Rs. 84.26 crore was released under the goods to developing countries as public goods and scheme during the year. at affordable costs is essential to enhance the actions of developing countries towards pursuing sustain- As regards Scheduled Tribes their economic empow- able development technologies. erment continued through extension of financial support through National Scheduled Tribes Finance and India released its National Action Plan on Climate Development Corporation (NSTFDC). The Sched- Change (NAPCC) on June 30, 2008 to outline its uled Tribes and Other Traditional Forest Dwellers strategy to meet the challenge of climate change. This (Recognition of Forest Rights) Act was notified for Action Plan identifies measures that promote the operation with effect from December 31, 2007. The objectives of sustainable development of India while responsibility for implementing the Act vests with also yielding co-benefits for addressing climate the State/UT Governments. As per information col- change. Eight National Missions, form the core of lected from States till March 31, 2009 more than the National Plan. 20.50 lakh claims have been filed. More than 1,52 lakh titles have been distributed and another 1.93 Credit to Priority lakh are ready for distribution. Sector, Industry and Education As regards minorities, the corpus of the Maulana The Economic Survey said that expansion of credit Azad Education Foundation (MAEF) has been en- by the Banks moderated during the year. Credit by hanced from Rs. 100 crore in 2005-06 to Rs. 310 the Scheduled Commercial Banks (SCBs) to the crore in 2008-09 for expanding its activities for imple- Commercial Sector in the year 2008-09 expanded mentation of educational schemes for educationally by 16.9% as compare to 21.0% in 2007-08. Bank backward minorities. The authorized share capital credit to the Commercial Sector witnessed strong of the National Minorities Development and Finance growth in the first half of the year and decelerated Corporation (NMDFC) has been raised from Rs. 650 during the second half. crore in 2006-07 to Rs. 850 crore in 2008-09 for expanding its loan and micro-finance operations to There was a moderation in the credit growth rate of promote self-employment and other economic ven- SCBs to 17.3% ( Rs. 408099 crore in 2008-09) from Copyright © 2009 | WWW.UPSCPORTAL.COM 53

Section -1 (Article : Economic Survay 2008-09) a level of 22.3%(Rs. 430724 crores) in the corre- steps towards transparency and sound corporate sponding period of the previous year. The total credit governance practices to generate investor confidence. flow from SCBs as on March 27, 2009 was Rs. 27,70,012 crore, of which Rs. 20,11,591 crore was According to the Survey, assets under management from the Public Sector Banks (PSBs). PSBs regis- of mutual funds declined sharply from Rs. 5,49,936 tered a growth of 20.4% in 2008-09 compared to crore at the end of 2007 to Rs. 4,13,365 crore at the 22.5% in the previous year. Non food credit at the end of 2008. A perceptible shift was noticed from end of March, 2009 grew by 17.5 percent as com- growth-oriented scheme to income/debt oriented pared to 23.0 percent growth at the end of March, schemes to income/debt oriented schemes. Assets 2008. under income-oriented schemes in 2008 were almost at their previous year’s level and accounted for 47.7 While loans to agriculture and allied activities grew per cent of total assets under management at the end at the rate of 23.0% as compared to 19.5% in the of 2008. The decline in assets was seen across the previous year, credit to industry grew at 21.6% dur- schemes, the exceptions being Gilt and Gold ETF ing 2008-09 as against 2.43% in the last year. Ad- Schemes, which showed larger assets under manage- vances under personal loans for housing and con- ment in 2008. sumers durables witnessed deceleration. Loans to The Survey has expressed satisfaction that perfor- commercial real estates and NBFCs remained high mance of the capital market has lately shown signs in 2008-09 with a growth of 44.6 and 25.1% respec- of revival of investor interest and confidence – both tively. The private sector lending was up by 22.5% domestic and foreign institutional investors. Net in- compare to 17.5% from year to year basis as did the vestment by FIIs in equity instruments amounted to education lending with 39.2% growth in 2008-09 US$ 5.4 billion during April-May 2009. This has re- compare to 35.0% in the last year. sulted on account of several policy initiatives taken by the Government relating to the Primary Market, Though the growth in the different sources of funds Secondary Market, Mutual Funds, Foreign Institu- for the SCBs during 2008-09 was lower than for tional Investments, Corporate Debt Market and 2007- 08, the growth in deposits with the banking Regulatory changes, during 2008-09. system in 2008-09 was higher than the growth of credit. The credit – deposit (C-D) ratio peaked to Monetary Policy 75.2 as of October, 2008 but declined thereafter. It stood at 72.3 as of March 27, 2009. The Economic Survey laid focus on having a cali- brated approach to using monetary policy measures Capital Markets for an early return to the high growth path. At the same time, efforts to build and preserve financial sta- A turnaround has been noticed in the performance bility have to be high on the agenda. of Mutual Fund industry, which had remained subdued during 2008, said the Economic Survey 2008- The Survey said, the monetary policy in 2008-09 had 09. Mutual fund investments (net) in equity markets to address the emerging economic situation, wherein turned positive in March 2009 and were Rs. 2,320 the position in the second half of the year was sub- crore during April-May, 2009 while they invested Rs. stantially different from the first half. The policy had 36,791 crore in debt instruments during the same to contend with the spill-over effects of the global period. There is scope for expansion of mutual fund financial crisis, on the country’s growth path. The industry as only 7.7 per cent of total financial saving liquidity situation had improved significantly towards was allocated to mutual funds in 2007-08. As per the end of 2008-09, in the wake of measures taken the Survey, the retail participation, which is pres- by the RBI. ently estimated at 15 per cent, is expected to increase in the years to come as availability of products and Taking into account the need to respond to sluggish investor education improve and the industry takes economic growth witnessed lately, the Survey says, Copyright © 2009 | WWW.UPSCPORTAL.COM 54

Section -1 (Article : Economic Survay 2008-09) growth in money supply (M3) for 2009-10 was en- For more effective liquidity management and to envisaged at 17.0 per cent as an indicative projection. sure that the market borrowing programme of the Consistent with this, the growth in aggregate depos- Government was conducted in a non-disruptive man- its of scheduled commercial banks has been projected ner, the scope of the SMO was widened with effect to grow at 18.0 per cent and non-food credit by 20.0 from February 19, 2009 by including purchases of per cent. government securities through an auction based mechanism in addition to purchases through the ne- The monetary policy stance for 2009-10 is aimed to gotiated dealing system-order matching (NDS-OM) ensure a policy regime that will enable credit expan- segment. sion at viable rates while preserving credit quality so as to support the return of the economy of a high The Economic Survey said that in order to enhance growth; to continuously monitory global and domes- domestic rupee liquidity, the cash reserve ratio (CRR) tic conditions and respond swiftly and effectively as a percentage of the Net Demand and Time Li- through policy instruments so as to minimize the abilities (NDTL) was reduced by a cumulative 400 impact of the adverse developments and reinforce points from 9 per cent with effect from January the effect of the positive developments; and main- 17,2009;the Statutory Liquidity Ratio (SLR) as a tain a monetary and interest rate regime supportive percentage of the NDTL was reduced by hundred of price stability and financial stability. basis point from 25 per cent to 24 per cent with effect from November 8, 2008; a term repo facility for Steps Taken to Enhance Domestic Rupee Liquid- an amount of Rs. 60,000 crore was instituted under ity: The Economic Survey 2008-09 said, variation the LAF to enable banks to ease liquidity stress faced in cash balances of the Central Government, capital by Mutual Funds (MFs) and Non-Banking Financial flows and the concomitant foreign exchange opera- Companies (NBFCs) with associated SLR exemptions of the Reserve Bank of India (RBI)were the tion of 1.5 per cent of NDTL; an advance of Rs. key drivers of liquidity conditions during the year. 25,000 crore was provided to financial institutions RBI continued its policy of active management of under the Agricultural Debt Waiver and Debt Relief liquidity during the financial year 2008-09 using CRR, Scheme pending release of money by the Govern- Open Marked Operations (OMC) including the Mar- ment; provision of a reference facility for an amount ket Stabilization Scheme (MSS) and the Liquidity of Rs. 4,000 crore to the National Housing Bank Adjustment Facility (LAF) to maintain appropriate (NHB) was undertaken to provide liquidity support liquidity in the system so that all legitimate require- to the housing sector and a refinance facility to the ments of credit were met consistent with the objec- EXIM Bank was provided with a view to mitigating tive of price and financial stability. the pressures on Indian exporting companies. Accordingly, monetary and liquidity management Agro Sector Loan operations changed course beginning mid- Septem- ber, 2008 in order to address the liquidity situation As per the Economic Survey 2008-09, the total emerging from the unfolding global financial crisis. amount disbursed by all Banks to the Agriculture and Allied Activities Sector is Rs. 2,64,455 crores as Special Market Operations (SMO) were conducted against the target of 2,80,000 crores registering by the RBI during the first week of June, 2008 to the 94.4% achievement. In comparison to the disburse- first week of August, 2008 to improve access of pub- ment of Rs. 254657 crore as on March, 2008, there lic sector of companies to domestic liquidity and al- is a rise of Rs. 9798 crores to the sector. Of the total leviate the lumpy demand in the foreign exchange disbursement Rs. 202856 crores were from Com- market in the context of the unprecedented increase mercial Banks, Rs. 35447 crores by Cooperative in international oil prices. The SMOs were, however, Banks and Rs. 25,852 crores by Regional Rural liquidity neutral in nature. Banks. Copyright © 2009 | WWW.UPSCPORTAL.COM 55

Section -1 (Article : Economic Survay 2008-09) During 2008-09( till February 2009), a total of 47.26 In power sector, the Survey stated, the growth of lakhs Kisan Credit Cards(KCC) amounting with lim- electricity generation by power utilities in 2008-09 its aggregating Rs. 26828 crores were issued. The was at 2.7 per cent which was much short of tar- total number of KCC holders in the country as on geted 9.1 per cent. During 2008-09, despite the sharp February 28, 2009 stood at 808.00 lakhs. decline in hydro and nuclear generation, the growth in total electricity generation was positive due to 5 Under the Agricultural Debt Waver and Debt Relief per cent plus growth in thermal generation. The Sur- Scheme, the Government provided Rs. 25,000 crores vey mentions that less inflow of water into reser- to the Commercial Banks RRBs and Cooperative voirs in the case of hydro stations and for other power Credit Institutions as the first instalments Of this Rs. stations mainly due to fuel supply 17500 crore was provided to RRBs and Coopera- tives as temporary liquidity support and Rs. 7500 Constraints as the reasons for negative growth in crores to Commercial Banks. power generation. Keeping in view the target set by the National Electricity Policy 2005, a capacity addition of 78,700 MW has been set for the XIth Five Physical Infrastructure Year Plan, of which 19.9 per cent is in the hydel sectors, 75.8 per cent thermal and the rest nuclear. The Recognizing the importance of physical infrastruc- Survey mentioned that a number of projects envis- ture on sustainability of growth and overall develop- aged for the XIth Plan have made steady progress, ment, the Economic Survey 2008-09 stated that with most of these in a position to be commissioned spending on infrastructure has larger multiplier ef- within the plan period. The Survey also listed out fects. There has been some improvement in infra- major reforms initiated in order to help power utili- structure development in transport, communication ties to improve efficiency and commercial viability. and energy sector in the country in the recent year, The Ministry of Power signed the MOUs with the there are still significant gaps that needed to be States to undertake time bound distribution reforms, bridged. The current economic slow down provides the Survey adds. With a view to provide impetus to an opportunities for countries like India that have a electrification of villages under the Rajiv Gandhi substantial degree of unmet infrastructure require- Grameen Vidyutikaran Yojana, the Economic Sur- ments. vey states that 59,882 villages have been electrified during the XIth Five Year Plan and electricity con- According to the Economic Survey, the capacity cre- nections to 53.78 lakh BPL households have been ation in infrastructure sectors presented a mixed pic- released up to 31st March 2009. ture in 2008-09. While telecom and petroleum sectors performed well in 2008-09 as compared to the The Survey stated that during 2008-09, the petro- recent years, the power sector exhibited consider- leum sector has been affected by the wild swings in able shortfall. Most infrastructure sectors too wit- the international oil prices. The production of crude nessed subdued growth in production/services dur- and its products witnessed slack growth in 2008-09 ing 2008-09 because of slump in economic activity as compared to the previous year. The growth of 3 and commodity price, oil price shocks and overall per cent in refinery production was mainly on ac- global economic crisis. The Port and Air cargo count of impressive performance of private sector growth slowed down considerably reflecting the slug- production. In 2008-09, while the production of gishness in import and export growth in second half crude oil declined but its consumption increased. In of 2008-09. The rail freight growth too slowed down comparison, production of petroleum products in- but to a lesser degree because the coal sector expe- creased by 3.9 per cent in the same year, while its rienced robust production. In addition, the growth consumption declined. The growth in diesel con- in telecommunication stood as exception a midst the sumption declined to 8.4 per cent in 2008-09 as com- general slowed down, the Survey adds. pared to 11.1 per cent in 2007-08 because of indus- Copyright © 2009 | WWW.UPSCPORTAL.COM 56

Section -1 (Article : Economic Survay 2008-09) trial and business slow down in sectors like automo- For improving the road connectivity to the state capi- biles etc. Giving details of the progress under New tals, district headquarters and remote places in the Exploration Licensing Policy (NELP), the Survey north-eastern region, a scheme Special Accelerated states that 203 Production Sharing Contracts have Road Development Programme is being imple- been signed since 1999, thereby increasing the area mented. The High Powered Inter-Ministerial Com- under exploration more than four times. As on April mittee under the programme has approved the sub- 1, 2009, investment commitment under NELP is jects covering 1065 KMs at a cost of Rs. 3,378 crore about 10 billion US dollar on exploration, against under Phase A of the programme. The Survey men- which actual expenditure so far under the policy is tioned that the XIth Five Year Plan has projected an about 4.7 billion US dollar. In addition, 5.2 billion investment requirement of Rs. 41,347 crore (at 2006- US dollar investment has been made on development 07 prices) in rural roads. During the first two year of of discoveries. the plan an expenditure of Rs. 25, 780.70 crore has been incurred on rural roads under the Pradhan In the coal sector, raw coal production is provision- Mantri Gram Sadak Yojana. ally estimated at 493.20 million tonnes in 2008-09 Regarding Civil Aviation Sector, the Survey stated as against 457.08 million tonnes during correspond- that the expansion of the sector continued. How- ing period last year, thereby registering a growth rate ever, the sector showed signs of slow down due to of 7.90 per cent. The cooking coal production was steep rise in cost of air turbine fuel and global eco- 29.76 million tonnes during April-February 2009 as nomic slow down. The number of domestic passen- against 29.70 million tonnes in the corresponding gers declined by 5 per cent during 2008 as compared period last year. The Survey mentions that due to to 2007. The silver lining was a growth of 14.55 per the enhanced production by all stakeholders, the cent in the domestic cargo. The Surveys mentioned growth rate of raw coal production was increased to about t he massive modernization/expansion about 8 per cent during 2008-09 as compared to 6 programme of International Airports at New Delhi, per cent in the corresponding period. Mumbai, Kolkata and Chennai. The Survey further adds that the Airports Authority of India is upgrad- Regarding National Highways Development Project ing and modernizing 35 non-metro airports in the (NHDP), being implemented by the National High- country in a time bound manner. Development of ways Authority of India, the Survey states that 11,037 Airports in the North-Eastern Region is being taken KM of National Highways has been completed by up on priority basis. 31st March 2009, the bulk of which lies on Golden Quadrilateral (GQ). Nearly 98 per cent works on The telecom sector continued to register significant GQ have been completed by March this year and the growth during the year. With about 414 million con- North-South and East-West corridors are expected nections till February this year, India’s telecommu- to be completed by December this year. The Survey nication network is the 3rd largest and the second further added that the Government has given approval largest wireless network in the world. At the current for upgradation of 12,109 KM under NHDP phase growth rate, the target of 500 million connections III at an estimated cost of Rs. 80,626 crore; two- by 2010 is well within reach. The tele-density also laning for 5,000 KM of National Highways under increased from 12.7 per cent in March 2006 to 35.65 NHDP Phase IV at an estimated cost of Rs. 6,950 per cent in February this year. The Government has crore; six laning of 6,500 KM of National Highways taken several steps directed at reduction in entry under NHDP Phase V at a cost of 41,210 crore; 1000 barriers, creation of a level playing field between in- KM express ways with full access control at a cost cumbents and new entrants and forward looking of Rs. 16,680 crore under NHDP Phase IV and con- regulation. With the special thrust given to rural te- struction of ring road grade separation intersection, lephony, the number of rural telephones went up from flyovers, elevated highways, underpasses and service 12.3 million in March 2004 to 112.71 million in Janu- roads at a cost of Rs. 16,680 crore under NHDP ary this year. Consequently the rural tele-density Phase VII. reached 13.81 per cent. Since January 2000 to De- Copyright © 2009 | WWW.UPSCPORTAL.COM 57

Section -1 (Article : Economic Survay 2008-09) cember 2008, the total Foreign Direct Investment is Rs. 27,482.96 crore of which the inflow during 2008 is Rs. 11,595.48 crore. Recognizing the importance of increase broadband connectivity for growth of knowledge based society, several steps have been taken to promote broadband in the country. As a result, the broadband subscribers increased from 0.18 million in March 2005 to about 5.69 million by Feb- ruary this year. Regarding Urban Infrastructure, the Survey stated that under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), an additional central assistance of Rs. 50,000 crore for 7 years and an equal amount from the State Governments and urban local bodies was provided to the Mission cities (IMP) Get UPSCPORTAL , Jobs, Re- for improvement in their civic services levels. Memo- sults, Notification Alerts on Email. randum of Agreement for Urban Reform Agenda has been signed with 62 mission cities and 6 urban local Step-1: Fill Your Email address in form be- bodies. The Mission cities have undertaken fresh ini- low. you will get a confirmation email within tiatives under JNNURM with an objective to con- 10 min. tribute to sustainable functioning of local bodies. Under a parallel scheme of Urban Infrastructure Step-2: Varify your email by clicking on the Development Scheme for Small and Medium towns link in the email. (check Inbox and Spam fold- for Non-Mission cities and towns launched in 2005- ers) 06, 747 projects have been sanctioned at an approved cost of Rs. 12,793.81 crore for 632 towns till March Step-3: Done! Now you will regular Alerts this year. The year 2008 being International Year of on your email. Sanitation, a National Urban Sanitation Policy was launched in November 2008 for transforming all towns and cities of the country into 100 per cent sanitized, healthy and livable spaces and ensuring sustained public health and improved environment to its citizen. Recognizing the importance of quality infrastructure for sustainable growth, the Economic Survey emphasized the need of better coordination between two approaches being followed for infrastructure building so as to promote its balanced development through out the length and breath of the country. The Survey mentioned that a tangible progress has been made in attracting private investment infrastructure. However, such public initiatives are constrained by factors like inadequate shelf of bankable projects and shortage of long- term finance for projects. Copyright © 2009 | WWW.UPSCPORTAL.COM 58

Section -1 (Hindi Article : Climate Change) VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ xÉE É®Éi¨ÉE |É¦ÉÉ´ÉÉå E Éä E ¨É E ®xÉä Eä ‡±ÉB +ÆiÉ®ÉÇ¹]ÅÒªÉ ºÉ½ªÉÉäMÉ By Dr. Divya Author is Currently Working as Assistant Professor for Home Science ´ÉÉªÉÖ¨ÉÆb ±É ¨ÉäÆ E É¤ÉÇxÉb É<+ÉìCºÉÉ<b E É ºiÉ® ¤ÉgxÉä ºÉä ½ ÉäxÉä ´ÉÉ±ÉÉ VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ +ÉVÉ {ÉªÉÉÇ´É®hÉ E Ò ºÉ¤ÉºÉä MÉÆ¦ÉÒ® ºÉ¨ÉºªÉÉ+ÉäÆ ¨ÉäÆ ºÉä BE ½è* +É‡lÉÇE ‡G ªÉÉE ±ÉÉ{ÉÉäÆ E É ºÉÉ¨ÉÉxªÉ ‡´ÉºiÉÉ®, ¤ÉgiÉÒ VÉxÉºÉÆJªÉÉ +Éè® VÉÒ´ÉÉ„¨É <ÆÈvÉxÉ E É <ºiÉä¨ÉÉ±É +É‡n BäºÉä E É®hÉ ½é, ‡VÉxÉºÉä ¨ÉÉxÉ´ÉVÉ‡xÉiÉ OÉÒxÉ ½ É=ºÉ MÉèºÉÉäÆ (VÉÒBSÉVÉÒ) E É =iºÉVÉÇxÉ ½ ÉäiÉÉ ½è* VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ ºÉä =i{ÉzÉ ºÉ¨ÉºªÉÉ ºÉä ‡xÉ{É] xÉä Eä ‡±ÉB +ÆiÉ®ÉÇ¹] ÅÒªÉ ºÉ¨ÉÖn ÉªÉ xÉä 1992 ¨ÉäÆ ''®É¹]ÅÉäÆ Eä ºÉÉZÉÉ {É®ÆiÉÖ ‡xÉ‡n Ç¹] n É‡ªÉi´É +Éè® ºÉÆ¤Ér IÉ¨ÉiÉÉ+ÉäÆ'' Eä +ÉvÉÉ® {É® ºÉÆªÉÖCiÉ ®É¹]Å VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ £ä ¨É´ÉEÇ E x´ÉäÆ„ÉxÉ (ªÉÚBxÉB¡ ºÉÒºÉÒºÉÒ) E É MÉ`xÉ ‡E ªÉÉ* ªÉÚBxÉB¡ ºÉÒºÉÒºÉÒ E É =qä„ªÉ ´ÉÉªÉÖ¨ÉÆb ±É ¨ÉäÆ OÉÒxÉ ½ É=ºÉ MÉèºÉÉäÆ Eä ºÉÆEä xphÉ E Éä ‡ºlÉ® ¤ÉxÉÉxÉÉ ½ è iÉÉ‡E VÉ±É´ÉÉªÉÖ |ÉhÉÉ±ÉÒ ¨ÉäÆ ¨ÉÉxÉ´ÉVÉ‡xÉiÉ JÉiÉ®xÉÉE ½ ºiÉIÉä{ÉÉäÆ E Éä ®ÉäE É VÉÉ ºÉEä * ¤ÉÉn ¨ÉäÆ ´É¹ÉÇ 1997 ¨ÉäÆ E x´ÉäÆ„ÉxÉ Eä ºÉnºªÉ ®É¹] ÅÉäÆ xÉä CªÉÉä] Éä ºÉ¨ÉZÉÉèiÉÉ º´ÉÒE É® ‡E ªÉÉ, ‡VÉºÉ¨ÉäÆ +ÉètÉä‡MÉE n ä„ÉÉäÆ Eä ‡±ÉB OÉÒxÉ ½ É=ºÉ MÉèºÉÉäÆ Eä =iºÉVÉÇxÉ ¨ÉäÆ E ¨ÉÒ ±ÉÉxÉä Eä E ÉxÉÚxÉÒ o ‡¹] ºÉä ¤ÉÉvªÉE É®Ò ±ÉIªÉ ‡xÉvÉÉÇ‡®iÉ ‡E B MÉB* ªÉ½ iÉªÉ ‡E ªÉÉ MÉªÉÉ ‡E +ÉètÉä‡MÉE ®É¹] Å ''|ÉlÉ¨É |É‡iÉ¤ÉriÉÉ +´É‡vÉ'' ªÉÉxÉÒ 2008-2012 Eä nÉè®ÉxÉ VÉÒBSÉVÉÒ Eä EÖ ±É =iºÉVÉÇxÉ ¨ÉäÆ 5.2 |É‡iÉ„ÉiÉ E Ò E ¨ÉÒ ±ÉÉªÉäÆMÉä* VÉ±É´ÉÉªÉÖ {É‡® ´ÉiÉÇxÉ ´ÉiÉÇ¨ÉÉxÉ ºÉ¨ÉªÉ E Ò ºÉ¤ÉºÉä |É¨ÉÖJÉ ºÉ¨ÉºªÉÉ: VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ ´ÉiÉÇ¨ÉÉxÉ ºÉ¨ÉªÉ E Ò ºÉ¤ÉºÉä |É¨ÉÖJÉ ºÉ¨ÉºªÉÉ ½ è +Éè® {ÉªÉÉÇ´É®hÉ-‡xÉªÉÉ¨ÉE Éå Eä ºÉ¨ÉIÉ BE ºÉ¤ÉºÉä ¤ÉcÒ SÉÖxÉÉèiÉÒ ½è * ªÉ½ +É‡lÉÇE , º´ÉÉºlªÉ +Éè® ºÉÖ®IÉÉ, JÉÉt =i{ÉÉnxÉ B´ÉÆ +xªÉ +ÉªÉÉ¨ÉÉå Eä ºÉÉlÉ ¤ÉfiÉÃÉ ½ Ö+É ºÉÆE ] ½ è * ¨Éè‡CºÉE Éä E Ò ®ÉVÉvÉÉxÉÒ ¨Éè‡CºÉE Éä xÉMÉ® ¨Éå <ºÉ ´É¹ÉÇ Eä ‡´É„´É {ÉªÉÉÇ´É®hÉ ‡n´ÉºÉ E É +ÉªÉÉäVÉxÉ E ®xÉä E É E ÉªÉÇG ¨É ½ è* ‡n ºÉ¨¤É®, 2009 ¨Éå E Éä{ÉäxÉ½ äMÉxÉ ¨Éå CªÉÉäiÉÉä |ÉÉä] ÉäE É±É ½äiÉÖ +MÉ±Éä E ®É® {É® ºÉ½¨É‡iÉ +ÉMÉä ¤ÉfÉÃxÉä Eä ‡±ÉB ªÉ½ n ä„ÉÉå E Éä |Éä‡®iÉ E ®xÉä Eä |É‡iÉ =x¨ÉÖJÉ ½ è * ¨Éè‡CºÉE Éä xÉä E É¤ÉÇxÉ ¤ÉÉVÉÉ®Éå Eä +´ÉºÉ®Éå E Éä +{ÉxÉä ‡xÉªÉÆjÉhÉ ¨Éå ±Éä ‡±ÉªÉÉ ½ è +Éè® {É´ÉxÉ, ºÉÉè®, ¤ÉÉªÉÉäMÉèºÉ iÉlÉÉ ºÉÒb ÒB¨É (C±ÉÒxÉ bä´Éä±É{É¨Éå] ¨ÉäEè ‡xÉV¨É) {É‡®ªÉÉäVÉxÉÉ+ÉäÆ Eä ¨ÉÉ¨É±Éä ¨Éå <ºÉxÉä ¥ÉÉVÉÒ±É Eä ¤ÉÉn ‡uiÉÒªÉ ºlÉÉxÉ |ÉÉ{iÉ E ® ‡±ÉªÉÉ ½è * ºÉÆªÉÖH ®É¹]Å {ÉªÉÉÇ´É®hÉ E ÉªÉÇG ¨É (ªÉÚBxÉ<Ç{ÉÒ) xÉä ºÉÉiÉ +®¤É ´ÉÞIÉ +‡¦ÉªÉÉxÉ xÉÉ¨É ºÉä BE xÉ´ÉÒxÉ +{ÉäIÉÉEÞ iÉ +‡vÉE ¨É½ i´ÉÉE ÉÆIÉÒ E ÉªÉÇG ¨É |ÉÉ®Æ¦É E ® ‡n ªÉÉ ½ è, ‡VÉºÉE É ±ÉIªÉ ½ è - E Éä{ÉäxÉ½ èMÉxÉ ºÉ¨¨Éä±ÉxÉ iÉE |ÉiªÉäE ´ªÉ‡H Eä ‡±ÉB E ¨É ºÉä E ¨É BE ´ÉÞIÉ ±ÉMÉÉxÉä E É E ÉªÉÇG ¨É ºÉ¨{ÉzÉ E ® ±ÉäxÉÉ * <ºÉ ´É¹ÉÇ Eä ‡´É„´É {ÉªÉÉÇ´É®hÉ ‡n ´ÉºÉ E É ¨ÉÖJªÉ =qä„ªÉ BäºÉä {ÉªÉÉÇ´É®hÉ xÉÉªÉE Éå E Éä ºÉÉ¨ÉxÉä ±ÉÉxÉÉ ½è, ‡VÉx½ ÉåxÉä +iÉÖ±ÉxÉÒªÉ E É®xÉÉ¨Éä, +‡¦ÉªÉÉxÉ +Éè® |É‡iÉ¤ÉriÉÉ |Én ‡„ÉÇiÉ E ®xÉä ´ÉÉ±ÉÒ {ÉªÉÉÇ´É®hÉ ºÉÆ¤ÉÆvÉÒ +xªÉ MÉ‡iÉ‡´É‡vÉªÉÉÆ |Én‡„ÉÇiÉ E Ò ½é +Éè® BE ºÉÒvÉä- ºÉ®±É ‡´ÉSÉÉ® Eä ¨ÉÉvªÉ¨É ºÉä VÉÉMÉ° E iÉÉ {ÉènÉ E Ò ½ è * ºÉÆªÉÖH ®É¹] Å {ÉªÉÉÇ´É®hÉ E ÉªÉÇG ¨É xÉä {ÉªÉÉÇ´É®hÉ {É‡®´ÉiÉÇxÉ E Ò ºÉ¨ÉºªÉÉ E É ºÉÉ¨ÉxÉÉ E ®xÉä B´ÉÆ ±ÉÉäMÉÉå E Éä |Éä‡®iÉ E ®xÉä Eä ‡±ÉB <ºÉ E ÉªÉÇ ½ äiÉÖ ºÉ½ ªÉÉäMÉ ‡nªÉÉ ½è * |ÉiªÉäE ´É¹ÉÇ ±ÉMÉ¦ÉMÉ 60 +®¤É ] xÉ ºÉä +‡vÉE {±ÉÉ‡º] E E É =i{ÉÉnxÉ ‡E ªÉÉ VÉÉiÉÉ ½ è +Éè® <ºÉE É +‡vÉE ÉÆ„É ¦ÉÉMÉ |ÉÉªÉ: BE ¤ÉÉ® ½ Ò <ºiÉä¨ÉÉ±É ¨Éå ±ÉÉªÉÉ VÉÉiÉÉ ½ è VÉ¤É‡E ‡´É„´É-¦É® ¨Éå {±ÉÉ‡º] E Eä ¨ÉÉjÉ 5 |É‡iÉ„ÉiÉ ºÉä E ¨É ¦ÉÉMÉ E É ½Ò {ÉÖxÉSÉÇG hÉ ‡E ªÉÉ VÉÉiÉÉ ½ è* ®É¹] ÅÒªÉ ¦ÉÉèMÉÉä‡±ÉE ºÉÆºlÉÉxÉ Eä +xÉÖ¨ÉÉxÉÉå Eä +xÉÖºÉÉ® ½® 3 ‡¨ÉxÉ] ¨Éå 850 ±ÉÉJÉ ]xÉ {±ÉÉ‡º]E E É <ºiÉä¨ÉÉ±É ‡E ªÉÉ VÉÉiÉÉ ½è * <ºÉ |ÉE É® ¤ÉäE É® ½ Éä VÉÉxÉä ´ÉÉ±Éä {±ÉÉ‡º] E E É +‡vÉE ÉÆ„É ¦ÉÉMÉ xÉ iÉÉä {ÉÖxÉ: ={ÉªÉÉäMÉ ¨Éå ±ÉÉªÉÉ VÉÉiÉÉ ½ è +Éè® xÉ ½ Ò <ºÉºÉä VÉ¨ÉÒxÉ E Éä {ÉÉ] É VÉÉiÉÉ ½ è * ªÉ½ ºÉ¤É {ÉÉxÉÒ ¨Éå ¤É½E ® ºÉ¨ÉÖp E Ò +Éä® SÉ±ÉÉ VÉÉiÉÉ ½ è * ®qÒ {±ÉÉ‡º]E Eä ] ÖE cÉå E Éä MÉ±ÉiÉÒ ºÉä JÉÉxÉä E Ò SÉÒVÉå ºÉ¨ÉZÉE ® JÉÉ ±ÉäxÉä ºÉä ±ÉÉJÉÉå {ÉIÉÒ +Éè® ºÉ¨ÉÖpÒ VÉÒ´É E É±É-E ´É‡±ÉiÉ ½Éä VÉÉiÉä ½ é +Éè® {ÉÖxÉ: JÉÉxÉä E Ò ´ÉºiÉÖ+ÉäÆ Eä ° {É ¨Éå ªÉä ¨ÉÉxÉ´É iÉE {É½ ÖÆSÉ VÉÉiÉä ½é * Eè ºÉä±É {É‡®ªÉÉäVÉxÉÉ ¨Éå ´ÉèYÉÉ‡xÉE Éå +Éè® {ÉªÉÉÇ´É®hÉ‡´Én Éå E É BE n±É „ÉÉ‡¨É±É ½ è VÉÉä BE ºÉ¨ÉÉxªÉ =n Â nä„ªÉ ±ÉäE ® +ÉMÉä ¤Éf ®Ã½ É ½è -- ´É½ =qä„ªÉ ½è -- ºÉ¨ÉÖp ¨Éå ‡E ºÉ iÉ®½ iªÉÉVªÉ {±ÉÉ‡º]E {Én ÉlÉÉç E Éä {ÉE cÉ VÉÉB +Éè® =ºÉE É ‡b ] É‡CºÉ¡ É<Ç E ® (‡´É¹ÉÉH iÉÉ E Éä nÚ® E ®) =ºÉE É {ÉÖxÉSÉÇG hÉ ‡E ªÉÉ VÉÉ ºÉEä * Copyright © 2009 | WWW.UPSCPORTAL.COM 60

Section -1 (Hindi Article : Climate Change) VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ ºÉä +xÉäE BäºÉÒ SÉÖxÉÉè‡iÉªÉÉÆ ‡¨É±ÉiÉÒ ½é, VÉÉä ‡E ºÉÒ iÉ®½ E Ò ®É¹] ÅÒªÉ ºÉÒ¨ÉÉBÆ xÉ½ Ó ¨ÉÉxÉiÉÓ * BäºÉä ¦ÉÒ nä„É ½é, ‡VÉx½ ÉåxÉä +{ÉxÉä nä„É E Éä xÉ Eä ´É±É E É¤ÉÇxÉ b É<+ÉCºÉÉ<ºÉ±Ééb E Ò ±ÉMÉ¦ÉMÉ „ÉiÉ-|É‡iÉ„ÉiÉ ‡¤ÉVÉ±ÉÒ ¦ÉÚiÉÉ{ÉÒªÉ > ¹¨ÉÉ ºÉä |ÉÉ{iÉ E Ò VÉÉiÉÒ ½ è ±Éä‡E xÉ {É‡®´É½xÉ Eä ¨ÉÉ¨É±Éä ¨Éå <ºÉä SÉÖxÉÉè‡iÉªÉÉå E É ºÉÉ¨ÉxÉÉ E ®xÉÉ {Éc ®½ ®½É ½ è * ‡¤ÉVÉ±ÉÒ Eä ¤É±¤É E É |ÉSÉÉ±ÉxÉ +¤É ºÉä ±ÉMÉ¦ÉMÉ 200 ´É¹ÉÇ {ÉÖ®ÉxÉÉ ½Éä SÉ±ÉÉ ½è +Éè® ±ÉÉäMÉÉå E É vªÉÉxÉ +¤É > VÉÉÇ E Ò ¤ÉSÉiÉ E ®xÉä ´ÉÉ±Éä ¤É±¤ÉÉå E Ò +Éä® VÉÉxÉä ±ÉMÉÉ ½ è * ‡´É„´É E Éä +¤É ½ ‡®iÉ +lÉÇ´ªÉ´ÉºlÉÉ E Ò ZÉ±ÉE ¦ÉÒ ‡¨É±É SÉÖE Ò ½è * 13 JÉ®¤É (‡]Å‡±ÉªÉxÉ) b Éì±É® E Ò {ÉÚÆVÉÒ ´ÉÉ±ÉÒ 300 ‡´ÉkÉÒªÉ ºÉÆºlÉÉ+ÉäÆ xÉä ºÉÆªÉÖH ®É¹]Å {ÉªÉÉÇ´É®hÉ E ÉªÉÇG ¨É {É® +{ÉxÉä ½ ºiÉÉIÉ® E ® ‡n ªÉä ½ é +Éè® {ÉÖxÉxÉÇ´ÉÒE ®hÉÒªÉ > VÉÉÇ E É®Éä¤ÉÉ® ¨Éå +Éè® |ÉMÉ‡iÉ ±ÉÉxÉä Eä ´ÉÉºiÉä ºÉÆªÉÖH ®É¹] Å Eä M±ÉÉä¤É±É E É¨{ÉèC] ‡|É‡ºÉ{ÉÖ±ºÉ ¨Éå +ÉºlÉÉ ®JÉxÉä ´ÉÉ±Éä =kÉ®n ÉªÉÒ ‡xÉ´Éä„É Eä ‡±ÉB {ÉÖxÉxÉÇ´ÉÒE ®hÉÒªÉ > VÉÉÇ E É®Éä¤ÉÉ® ¨Éå +Éè® +‡vÉE |ÉMÉ‡iÉ ±ÉÉxÉä Eä =qä„ªÉ ºÉä > VÉÉÇ E É®Éä¤ÉÉ® Eä ‡±ÉB ½ºiÉÉIÉ® ‡E B VÉÉ SÉÖEä ½ é, ‡VÉºÉºÉä 160 +®¤É b É±É® E É =U É±É +ÉxÉä E Ò +É„ÉÉ ½ è * <ºÉ¨Éå Eä ´É±É ‡´ÉE ‡ºÉiÉ ½ Ò xÉ½ Ó +‡{ÉiÉÖ SÉÒxÉ +Éè® ¦ÉÉ®iÉ VÉèºÉä n ä„ÉÉå E Ò {É´ÉxÉ > VÉÉÇ- SÉÉ‡±ÉiÉ E Æ{É‡xÉªÉÉÆ ¦ÉÒ ºÉ‡¨¨É‡±ÉiÉ ½é * ´ÉiÉÇ¨ÉÉxÉ JÉÉt ºÉÆE ] +É{ÉÚ‡iÉÇ E Ò +{ÉäIÉÉ ¨ÉÖJªÉiÉªÉÉ ¨ÉÚ±ªÉÉå ºÉä VÉÖcÉ ½ Ö+É ½ è * ‡{ÉU ±Éä ±ÉMÉ¦ÉMÉ 50 ´É¹ÉÉç Eä nÉè®ÉxÉ, +xªÉ ºÉ¦ÉÒ iÉlªÉÉå Eä +‡iÉ‡®H =i{ÉÉn xÉ ¤Éf ÉÃxÉä {É® +iªÉ‡vÉE VÉÉä® ‡nªÉÉ MÉªÉÉ ½è * ºÉ¨ÉÖp ¨Éå +{ÉäIÉÉEÞ iÉ E ¨É +ÉCºÉÒVÉxÉ ªÉÖH IÉäjÉÉå ¨Éå -- ¨ÉÞiÉ IÉäjÉÉå ¨Éå (‡VÉxÉ¨Éå ¨ÉU ‡±ÉªÉÉÆ ªÉÉ +xªÉ ºÉ¨ÉÖpÒ VÉÒ´É-VÉxiÉÖ ªÉÉ iÉÉä E É±É-E ´É‡±ÉiÉ ½Éä VÉÉiÉä ½é ªÉÉ {É±ÉÉªÉxÉ E ® VÉÉiÉä ½ é), |ÉÉªÉ: EÞ ‡jÉ¨É =´ÉÇ®E Éå Eä n Ö¯ {ÉªÉÉäMÉ Eä E É®hÉ =xÉE Ò BäºÉÒ ‡ºlÉ‡iÉ ½ Éä VÉÉiÉÒ ½ è * ¤Én±ÉiÉä ¨ÉÉèºÉ¨É E Ò |É‡G ªÉÉ+ÉäÆ Eä E É®hÉ JÉÉtÉzÉ =i{ÉÉn xÉ {É® +ºÉ® {ÉciÉÉ ½ è, ´É¹ÉÉÇ E Ò +‡xÉ‡„SÉiÉiÉÉ, ºÉ¨ÉÖp iÉ±É Eä ‡´ÉºiÉÉ®, ºÉ¨ÉpiÉ]ÒªÉ iÉÉVÉÉ VÉ±É ¦ÉÆb É® ¨Éå E ¨ÉÒ +ÉxÉä, ¤ÉÉf E ÃÒ ‡´É¦ÉÒ‡¹ÉE É +Éè® ´ÉÉiÉÉ´É®hÉ E Ò > ¹¨ÉÉ ¤Éf xÉÃä Eä E É®hÉ +xÉäE {É‡®´ÉiÉÇxÉ +ÉiÉä ½ é * +¨ÉäWÉxÉ Eä +‡vÉE ´É¹ÉÉÇ ´ÉÉ±Éä ´ÉxÉÉå iÉlÉÉ +ÉEÇ ‡] E ] ÖÆbÅÉ VÉèºÉä {ÉªÉÉÇ´É®hÉ ‡´É‡´ÉvÉiÉÉ ´ÉÉ±Éä IÉäjÉÉå ¨Éå MÉ¨ÉÔ +Éè® „ÉÖ¹E iÉÉ Eä E É®hÉ +xÉäE =±±ÉäJÉxÉÒªÉ {É‡®´ÉiÉÇxÉ {ÉÉªÉä VÉÉ ®½ ä ½é * {É½ ÉcÉå Eä M±Éä‡„ÉªÉ®Éå Eä ‡{ÉPÉ±ÉxÉä, =xÉEä +Éè® {ÉÒU ä E Ò +Éä® ½ ]xÉä VÉèºÉÒ |É´ÉÞ‡kÉªÉÉÆ |ÉÉªÉ: „ÉÖ¹E ´ÉxÉÉå ¨Éå {ÉÉ<Ç VÉÉiÉÒ ½é * EÖ U ±ÉÉäMÉÉå Eä ‡±ÉB =¹hÉE ‡] ¤ÉÆvÉÒªÉ ´ÉxÉÉå E É +É„ÉªÉ Eä ´É±É ‡]¨¤É® +Éè® ±É_Éå Eä ‡±ÉB ´ÉÞIÉ-{ÉÖÆVÉÉå iÉE ½ Ò ºÉÒ‡¨ÉiÉ ½ è * ªÉä ´ÉÞIÉ ‡´ÉE ‡ºÉiÉ n ä„ÉÉå Eä E É¤ÉÇxÉ-=iºÉVÉÇxÉ E É +´É„ÉÉä¹ÉhÉ E ®iÉä ½ é * ªÉ‡n =xÉE Ò MÉhÉxÉÉ +{ÉäIÉÉEÞ iÉ BäºÉÒ |É¤ÉÖr +É‡lÉÇE |ÉhÉÉ±ÉÒ ºÉä E ®å, ‡VÉºÉ¨Éå |ÉEÞ ‡iÉ uÉ®É |ÉnkÉ EÖ ±É ‡´ÉE ÉºÉ =i{ÉÉnxÉ ºÉ‡¨¨É‡±ÉiÉ ½Éå +Éè® ‡VÉºÉ¨Éå ¨ÉÉä]® E É®Éå, ]ä±ÉÒ‡´ÉVÉxÉ ºÉä]Éå iÉlÉÉ Eä E É®hÉ ‡´É„´É +lÉÇ´ªÉ´ÉºlÉÉ ¨Éå +iªÉ‡vÉE ‡´ÉPÉ] xÉ +ÉªÉäMÉÉ -- +iÉÒiÉ iÉlÉÉ ´ÉiÉÇ¨ÉÉxÉ Eä ¿ÉºÉÉå Eä ¦É‡´É¹ªÉ {É® EÖ U ¦ÉÒ +ºÉ® xÉ½Ó {ÉcäMÉÉ * <ºÉEä ‡´É{É®ÒiÉ, VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ ºÉÆ¤ÉÆvÉÒ +xiÉ®„ÉÉºÉE ÒªÉ E ÉªÉÇn ±É Eä +xÉÖ¨ÉÉxÉÉå Eä +xÉÖºÉÉ®, 30 ´É¹ÉÉç E Ò +´É‡vÉ ¨Éå ‡´É„´É VÉÒb Ò{ÉÒ {É® Eä ´É±É 0.1-0.2 |É‡iÉ„ÉiÉ E É ¨ÉÉ¨ÉÚ±ÉÒ +ºÉ® ½ Ò {Éc ºÉEä MÉÉ * ‡´É„´É {ÉªÉÉÇ´É® hÉ ‡n ´ÉºÉ ¨ÉÉxÉ´É {ÉªÉÉÇ´É®hÉ {É® º] ÉìE ½ Éä¨É ºÉ¨¨Éä±ÉxÉ E Ò „ÉÖ° +ÉiÉ E Éä ®äJÉÉÆ‡E iÉ E ®iÉä ½ ÖB ºÉÆªÉÖH ®É¹] Å +É¨É ºÉ¦ÉÉ xÉä 1972 ¨Éå ‡´É„´É {ÉªÉÉÇ´É®hÉ ‡n´ÉºÉ E Ò ºlÉÉ{ÉxÉÉ E Ò VÉÉä ½® ´É¹ÉÇ {ÉÉÆSÉ VÉÚxÉ E Éä ¨ÉxÉÉªÉÉ VÉÉiÉÉ ½è * ‡´É„´É {ÉªÉÉÇ´É®hÉ ‡n ´ÉºÉ |É¨ÉÖJÉ +ÉvÉÉ® ½è ‡VÉºÉEä ¨ÉÉvªÉ¨É ºÉä ºÉÆªÉÖH ®É¹] Å {ÉÚ®ä ‡´É„´É ¨Éå {ÉªÉÉÇ´É®hÉ Eä |É‡iÉ VÉÉMÉ° E iÉÉ {ÉènÉ E ®iÉÉ ½è +Éè® ®ÉVÉxÉè‡iÉE vªÉÉxÉÉE ¹ÉÇhÉ E Éä ¤Éf ÉÃiÉÉ ½ è * 1972 ¨Éå ½ Ò ºÉÆªÉÖH ®É¹] Å {ÉªÉÉÇ´É®hÉ E ÉªÉÇG ¨É E Ò ºlÉÉ{ÉxÉÉ ‡E ªÉÉ MÉªÉÉ lÉÉ VÉÉä ‡´É„´É {ÉªÉÉÇ´É®hÉ ‡n´ÉºÉ E É, {ÉªÉÉÇ´É®hÉ Eä |É‡iÉ VÉÉMÉ° E iÉÉ {ÉènÉ E ®xÉä +Éè® ±ÉÉäMÉÉå E Éä {É½ ±É E ®xÉä Eä ‡±ÉB |ÉÉäiºÉÉ‡½iÉ E ®xÉä ¨Éå ={ÉªÉÉäMÉ E ®iÉÉ ½è * ‡´É„´É {ÉªÉÉÇ´É®hÉ ‡n ´ÉºÉ E É BVÉåbÉ ½ è {ÉªÉÉÇ´É®hÉÒªÉ ¨ÉÖqÉå E Éä ¨ÉÉxÉ´ÉÒªÉ SÉä½ ®É n äxÉÉ, ºÉiÉiÉ +Éè® ¤É®É¤É®Ò ´ÉÉ±Éä ‡´ÉE ÉºÉ Eä ‡±ÉB ±ÉÉäMÉÉå E Éä +‡vÉE É® ºÉ¨{ÉzÉ E ®xÉÉ, ºÉ¨ÉÖn ÉªÉÉå ¨Éå ªÉ½ ¦ÉÉ´É {Éèn É E ®xÉÉ ‡E ´Éä {ÉªÉÉÇ´É®hÉ Eä |É‡iÉ xÉVÉ‡®B ¨Éå ¤Én±ÉÉ´É ±ÉÉxÉä +Éè® ºlÉÉxÉÒªÉ, IÉäjÉÒªÉ +Éè® Copyright © 2009 | WWW.UPSCPORTAL.COM 61

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Section -1 (Hindi Article : Climate Change) BxÉBB¨É{ÉÒ Eä +ÆiÉMÉÇiÉ SÉÉ® ´ÉÉªÉÖ |Én Ú¹ÉE Éå ªÉlÉÉ, ºÉ±¡ ® bÉ<Ç+ÉìCºÉÉ<b, xÉÉ<] ÅÉäVÉxÉ +ÉCºÉÉ<b , ±É‡¨¤ÉiÉ E hÉÒªÉ {Én ÉlÉÇ (BºÉ{ÉÒB¨É), +Éè® „´ÉºÉxÉÒªÉ ±É‡¨¤ÉiÉ E hÉÒªÉ {ÉnÉlÉÇ (+É®BºÉ{ÉÒB¨É{ÉÒB¨É) E Ò {É½SÉÉxÉ ºÉ¦ÉÒ ºlÉÉxÉÉå {É® ‡xÉªÉ‡¨ÉiÉ ° {É ºÉä ‡xÉMÉ®ÉxÉÒ ®JÉxÉä Eä ‡±ÉB E Ò MÉ<Ç ½ è * ´ÉÉªÉÖ E É ´ÉäMÉ +Éè® ‡n „ÉÉ, ºÉÉ{ÉäIÉ +ÉpÇiÉÉ +Éè® iÉÉ{É¨ÉÉxÉ VÉèºÉä ¨ÉÉèºÉ¨É ºÉÆ¤ÉÆvÉÒ |ÉSÉÉ±ÉE Éå E Ò ‡xÉMÉ®ÉxÉÒ E Éä ¦ÉÒ ´ÉÉªÉÖ E Ò MÉÖhÉ´ÉkÉÉ E Ò ‡xÉMÉ®ÉxÉÒ Eä ºÉÉlÉ ½ Ò ºÉ¨Éä‡E iÉ E ® ‡nªÉÉ MÉªÉÉ ½è * |Én Ú¹ÉE Éå E Ò ‡xÉMÉ®ÉxÉÒ SÉÉè¤ÉÒºÉ PÉÆ] ä VÉÉ®Ò ®½ iÉÒ ½ è * |ÉiªÉäE SÉÉ® PÉÆ]ä {É® MÉèºÉÒªÉ |ÉnÚ¹ÉE Éå E Éä +Éè® |ÉiªÉäE +É` PÉÆ] ä {É® E hÉÒªÉ {ÉnÉlÉÉç Eä xÉ¨ÉÚxÉä ‡±ÉB VÉÉiÉä ½é * ½® ºÉ{iÉÉ½ n Éä ¤ÉÉ® +Éè® EÖ ±É ‡¨É±ÉÉE ® ´É¹ÉÇ ¦É® ¨Éå 104 {É®ÒIÉhÉ ‡E B VÉÉiÉä ½ é * BxÉBB¨É{ÉÒ Eä +ÆiÉMÉÇiÉ ´ÉÉªÉÖ¨ÉÆb ±É E Ò ®É¹] Å´ªÉÉ{ÉÒ MÉÖhÉ´ÉkÉÉ {É® xÉWÉ® ®JÉxÉä Eä E É¨É ¨Éå Eä xpÒªÉ |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ ¤ÉÉäb Ç Eä IÉäjÉÒªÉ E ÉªÉÉÇ±ÉªÉ, ‡´É‡¦ÉzÉ ®ÉVªÉÉå Eä |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ ¤ÉÉäb Ç, Eä xp „ÉÉ‡ºÉiÉ |Én ä„ÉÉå E Ò |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ ºÉ‡¨É‡iÉªÉÉå, xÉÉMÉ{ÉÖ® ‡ºlÉiÉ ®É¹] ÅÒªÉ {ÉªÉÉÇ´É®hÉ +‡¦ÉªÉÉÆ‡jÉE Ò +xÉÖºÉÆvÉÉxÉ ºÉÆºlÉÉxÉ (xÉÒ®Ò BxÉ<Ç<Ç+É®+É<Ç), ºÉÒ{ÉÒºÉÒ´ÉÒ (Eä xpÒªÉ |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ ¤ÉÉäbÇ) Eä ºÉÉlÉ VÉÖcä ½ ÖB ½ é * ºÉÒ{ÉÒºÉÒ¤ÉÒ ´ÉÉªÉÖ¨ÉÆb±É MÉÖhÉ´ÉkÉÉ Eä +ÉÆE b Éå Eä ºÉÆE ±ÉxÉ ¨Éå ºÉÆMÉ‡iÉ +Éè® BE ° {ÉiÉÉ ¤ÉxÉÉB ®JÉxÉä Eä ‡±ÉB <xÉ BVÉå‡ºÉªÉÉå Eä ºÉÉlÉ ºÉ¨Éx´ÉªÉxÉ E É E É¨É E ®iÉÉ ½ è +Éè® ¨ÉÉxÉÒ] Ë®MÉ Eä xpÉå Eä {É‡®SÉÉ±ÉxÉ Eä ‡±ÉB iÉE xÉÒE Ò +Éè® ‡´ÉkÉÒªÉ ºÉ½ÉªÉiÉÉ |ÉnÉxÉ E ®iÉÉ ½è * ´ÉÉªÉÖ |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ ´ÉÉªÉÖ¨ÉÆb ±É E Ò MÉÖhÉ´ÉkÉÉ Eä +ÉE ±ÉxÉ Eä ‡±ÉB BxÉBB¨É{ÉÒ Eä +ÆiÉMÉÇiÉ Eä xpÉå E É MÉ` xÉ ‡E ªÉÉ MÉªÉÉ ½ è +Éè® <xÉE Éä ‡´É‡¦ÉzÉ ®ÉVªÉÉå Eä |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ ¤ÉÉäb Éç (BºÉ{ÉÒ-ºÉÒ¤ÉÒ) B´ÉÆ |ÉnÚ¹ÉhÉ ‡xÉªÉÆjÉhÉ ºÉ‡¨É‡iÉªÉÉå({ÉÒºÉÒºÉÒ) ºÉä |ÉÉ{iÉ +ÉÆE cÉå ºÉä ºÉÖºÉ‡VVÉiÉ E ® {ÉªÉÉÇ´É®hÉ bÉ] É ¤ÉéE Eä VÉ‡®ªÉä Eä xpÒªÉ |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ ¤ÉÉäb Ç (ºÉÒ{ÉÒºÉÒ¤ÉÒ) Eä ´Éä¤ÉºÉÉ<] {É® b É±ÉÉ VÉÉiÉÉ ½è * ´ÉÉªÉÖ |Én Ú¹ÉhÉ Eä ‡xÉªÉÆjÉhÉ Eä ‡±ÉB ®É¹] ÅÒªÉ ´ÉÉªÉÖ¨Éb±É MÉÖhÉ´ÉkÉÉ ¨ÉÉxÉE Éå E É ‡xÉvÉÉÇ®hÉE ® iÉÉ{É ‡´ÉtÖiÉ ºÉÆªÉÆjÉÉå, ºÉÒ¨Éå] E É®JÉÉxÉÉå, ±ÉÉè½ B´ÉÆ <º{ÉÉiÉ =tÉäMÉ, +±ªÉÖ‡¨É‡xÉªÉ¨É =tÉäMÉ, {Éä] ÅÉä‡±ÉªÉ¨É iÉä±É „ÉÉävÉ‡xÉªÉÉå +É‡n VÉèºÉÒ +‡iÉ |Én Ú¹ÉhÉE É®Ò =tÉäMÉÉå Eä =iºÉVÉÇxÉ ¨ÉÉxÉE Éå Eä ºÉÉlÉ ½Ò +‡vÉºÉÚ‡SÉiÉ ‡E ªÉÉ MÉªÉÉ ½è * <ºÉÒ =qä„ªÉ Eä ‡±ÉB xÉB +Éè® <ºiÉä¨ÉÉ±É ¨Éå +É ®½ ä ´ÉÉ½xÉÉå Eä ‡±ÉB ¦ÉÒ ´ÉÉ½xÉ ºÉÆ¤ÉÆvÉÒ ‡xÉE ÉºÉÒ ¨ÉÉxÉE Éå E É ‡xÉvÉÉÇ®hÉ ‡E ªÉÉ MÉªÉÉ ½ è * <ºÉ ºÉÆ¤ÉÆvÉ ¨Éå xÉB ´ÉÉ½ xÉÉå Eä ‡±ÉB ¨ÉÉxÉE Éå (¦ÉÉ®iÉ º]äVÉ +Éè® ¨ÉÉxÉE ) E Éä ‡xÉ¨ÉÉÇhÉ ºiÉ® {É® ½ Ò ±ÉÉMÉÚ ‡E ªÉÉ VÉÉiÉÉ ½ è * <ÈvÉxÉ ºÉÆ¤ÉÆvÉÒ MÉÖhÉ´ÉkÉÉ ({Éä] ÅÉä±É, b ÒWÉ±É, vÉ¨ÉxÉ iÉä±É) Eä ¨ÉÉxÉE Éå E É ¦ÉÒ ‡xÉvÉÉÇ®hÉ E ® +‡vÉºÉÚ‡SÉiÉ ‡E ªÉÉ VÉÉ SÉÖE É ½è * +‡iÉ |ÉnÚ¹ÉhÉE É®Ò =tÉäMÉÉå E Ò 17 ¸Éä‡hÉªÉÉå ºÉä ½ ÉäxÉä ´ÉÉ±Éä ´ÉÉªÉÖ |Én Ú¹ÉhÉ E Éä ‡xÉªÉÆ‡jÉiÉ E ®xÉä ´ÉÉ±Éä ¨ÉÉxÉE Éå E É +xÉÖ{ÉÉ±ÉxÉ ¦ÉÒ BºÉ{ÉÒºÉÒ¤ÉÒ +Éè® {ÉÒºÉÒºÉÒ Eä ¨ÉÉvªÉ¨É ºÉä ½Éä ®½É ½ è * <ºÉEä ºÉÉlÉ ½ Ò „´ÉºÉxÉÒªÉ ±É‡¨¤ÉiÉ E hÉÒªÉ {Én ÉlÉÉç Eä ‡±ÉB »ÉÉäiÉ |É¦ÉÉVÉxÉ +vªÉªÉxÉ (BºÉBBºÉ) nä„É Eä 6 „É½ ®Éå -- ‡n ±±ÉÒ, ¨ÉÖ¨¤É<Ç, SÉäzÉ<Ç, E ÉxÉ{ÉÖ®, ¤ÉÆMÉ±ÉÖ° +Éè® {ÉÖhÉä ¨Éå „ÉÖ° ½ Éä MÉªÉÉ ½ è * U Éä] ä ºiÉ® {É® ´ÉÉªÉÖ |Én Ú¹ÉhÉ ¡è ±ÉÉxÉä ´ÉÉ±Éä =tÉäMÉÉå (VÉèºÉä <È] ¦É_ä, º] ÉäxÉG „ÉºÉÇ, º{ÉÆVÉ ±ÉÉè½ ºÉÆªÉÆjÉ +É‡n) Eä ‡±ÉB ¦ÉÒ |Én Ú¹ÉhÉ ‡xÉ´ÉÉ®hÉ ºÉÆ¤ÉÆvÉÒ |ÉÉètÉä‡MÉ‡E ªÉÉå, ‡n „ÉÉ-‡xÉn æ„ÉÉå +Éè® ¨ÉÉxÉE Éå E Éä +{ÉxÉÉxÉä {É® VÉÉä® ‡n ªÉÉ VÉÉ ®½ É ½è * ´ÉÉªÉÖ |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ ½ äiÉÖ |ÉºiÉÉ‡´ÉiÉ ±ÉIªÉ BxÉBB¨É{ÉÒ Eä iÉ½ iÉ ´ÉÉªÉÖ MÉÖhÉ´ÉkÉÉ ‡xÉMÉ®ÉxÉÒ Eä xpÉå E Ò ºÉÆJªÉÉ 11´ÉÓ {ÉÆSÉ´É¹ÉÔªÉ ªÉÉäVÉxÉÉ Eä nÉè®ÉxÉ 342 ºÉä ¤Éf ÉÃE ® 700 E ® ‡nªÉÉ VÉÉBMÉÉ * ºÉÉlÉ ½ Ò xÉ¨ÉÚxÉÉå E Ò =‡SÉiÉ ° {É ºÉä VÉÉÆSÉ-{É®JÉ E ® +ÉÆE cÉå E Ò MÉÖhÉ´ÉkÉÉ E Éä ¦ÉÒ ±ÉMÉÉiÉÉ® ºÉÖvÉÉ®xÉä E Ò |É‡G ªÉÉ VÉÉ®Ò ½è * MÉÖhÉ´ÉkÉÉ Eä |É‡iÉ ‡´É„´ÉÉºÉ ¤ÉxÉÉB ®JÉxÉä +Éè® MÉÖhÉ´ÉkÉÉ ‡xÉªÉÆjÉhÉ (CªÉÚBCªÉºÉÒ) Eä ºÉÉlÉ-ºÉÉlÉ E ¨ÉÇSÉÉ‡®ªÉÉå Eä |É‡„ÉIÉhÉ +É‡n E Éä ¦ÉÒ |ÉÉäiºÉÉ‡½ iÉ ‡E ªÉÉ VÉÉ ®½ É ½è * E ÉªÉÇG ¨É Eä +ÆiÉMÉÇiÉ, MÉÆ¦ÉÒ® ° {É ºÉä |ÉnÚ‡¹ÉiÉ IÉäjÉÉå Eä ºÉÉlÉ-ºÉÉlÉ BE ±ÉÉJÉ ºÉä +‡vÉE +É¤ÉÉnÒ ´ÉÉ±Éä „É½®Éå ¨Éå ´ÉÉªÉÖ¨ÉÆb ±ÉÒªÉ MÉÖhÉ´ÉkÉÉ ‡xÉMÉ®ÉxÉÒ xÉä] ´ÉEÇ ºlÉÉ‡{ÉiÉ E ®xÉä E É |ÉºiÉÉ´É ½è * n ä„É¦É® ¨Éå EÖ ±É ‡¨É±ÉÉE ® 33 ºÉiÉiÉ ´ÉÉªÉÖ¨ÉÆb ±É MÉÖhÉ´ÉkÉÉ ‡xÉMÉ®ÉxÉÒ Eä xp (ºÉÒBBCªÉÚB¨ÉB) ºlÉÉ‡{ÉiÉ ‡E ªÉä VÉÉ SÉÖEä ½ é * ªÉä Eä xp ‡n ±±ÉÒ (5), ¤ÉÆMÉ±ÉÚ° (5), SÉäzÉ<Ç (5), „ÉÉä±ÉÉ{ÉÖ® (1), ½èn ®É¤ÉÉn (1), E Éä±ÉE ÉiÉÉ (2), ¨ÉÖ¨¤É<Ç(2), SÉxp{ÉÖ®(1), n ÖMÉÉÇ{ÉÖ®(1), ½ ‡±nªÉÉ (1), ½ É´ÉcÉ(1), +½¨Én É¤ÉÉn (1), {ÉÖhÉä(1), MÉÉ‡VÉªÉÉ¤ÉÉn( 1), +Éè® ¤ÉbÉän ®É (1) ¨Éä ºlÉÉ‡{ÉiÉ ‡E ªÉä MÉB ½ é * BäºÉä ½Ò +Éè® Eä xp ºlÉÉ‡{ÉiÉ E ®xÉä Copyright © 2009 | WWW.UPSCPORTAL.COM 71

Section -1 (Hindi Article : Climate Change) E Ò ªÉÉäVÉxÉÉ ½è, ‡VÉxÉEä +ÉÆE cä, =ºÉÒ ºÉ¨ÉªÉ ´Éä¤ÉºÉÉ<] {É® b É±É ‡n ªÉä VÉÉBÆMÉä * MªÉÉ®½ ´ÉÓ ªÉÉäVÉxÉÉ Eä nÉè®ÉxÉ ºÉÒ{ÉÒºÉÒ¤ÉÒ uÉ®É ‡SÉ‡¼xÉiÉ MÉÆ¦ÉÒ® ° {É ºÉä |Én Ú‡¹ÉiÉ IÉäjÉÉå +Éè® 59 ¨Éä] ÅÉä „É½ ®Éå +Éè® ®ÉVªÉÉå E Ò ®ÉVÉvÉÉ‡xÉªÉÉå ¨Éå ºÉÒBBCªÉÚB¨ÉBºÉ ºlÉÉ‡{ÉiÉ E ®xÉä Eä ‡±ÉB E n ¨É =` ÉªÉÉ VÉÉxÉÉ |ÉºiÉÉ‡´ÉiÉ ½è * ´ÉÉªÉÖ |Én Ú¹ÉhÉ E ®xÉä ´ÉÉ±Éä iÉÉ{É ‡´ÉtÖiÉ ºÉÆªÉÆjÉÉå, º{ÉÆVÉ ±ÉÉè½ ºÉÆªÉÆjÉÉå, º] ¨xÉ G „ÉºÉÇ, <È] ¦É_Éå, E ÉäªÉ±ÉÉ ¤ÉxÉÉxÉä ´ÉÉ±ÉÒ ¦É‡^ªÉÉå (E ÉäE +Éä´ÉxÉ {±ÉÉÆ]ÂºÉ), ±ÉÉè½ ‡¨É¸É vÉÉiÉÖ ºÉÆªÉÆjÉÉå (¡ä ®É-B±ÉÉìªÉ {±ÉÉÄ] ÂºÉ) +É‡n ¨Éä =iºÉVÉÇxÉ Eä ¨ÉÉxÉE Éå E É |É¦ÉÉ´ÉÒ f ÆMÉ ºÉä E ÉªÉÉÇx´ÉªÉxÉ E É |ÉºiÉÉ´É ¦ÉÒ ½ è * <ºÉÒ ºÉÆn ¦ÉÇ ¨Éå, ±ÉPÉÖ ºiÉ® {É® ´ÉÉªÉÖ |ÉnÚ¹ÉhÉ ¡è ±ÉÉxÉä ´ÉÉ±Éä =tÉäMÉÉå (º] ÉäxÉ G „ÉºÉÇ, <È] ¦É] ` ä, ‡®-®ÉäË±ÉMÉ ‡¨É±ºÉ +É‡n ) ¨Éå ¦ÉÒ ¨ÉÉxÉE Éå E É +xÉÖ{ÉÉ±ÉxÉ ºÉÖ‡xÉ‡„SÉiÉ E ®ÉxÉä {É® ‡´É„Éä¹É vªÉÉxÉ ‡n ªÉÉ VÉÉ ®½ É ½è * JÉiÉ®xÉÉE ´ÉÉªÉÖ |Én Ú¹ÉE Éå Eä ‡xÉªÉÆjÉhÉ (BSÉB{ÉÒ) Eä E ÉªÉÇ ªÉÉäVÉxÉÉ Eä ‡G ªÉÉx´ÉªÉxÉ E Ò |É¦ÉÉ´ÉÉäi{ÉÉnE iÉÉ Eä ¨ÉÚ±ªÉÉÆE xÉ E É ¦ÉÒ |ÉºiÉÉ´É ½è * ´ÉÉªÉÖ |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ E Ò E ÉªÉÇªÉÉäVÉxÉÉªÉå ´ÉÉªÉÖ¨ÉÆb ±É E Ò MÉÖhÉ´ÉkÉÉ ¨Éå ºÉÖvÉÉ® E Ò E ÉªÉÇ ªÉÉäVÉxÉÉBÆ iÉèªÉÉ® E ®xÉä Eä ‡±ÉB 16 xÉMÉ®Éå E Ò {É½ SÉÉxÉ E Ò MÉ<Ç ½ é * <xÉ¨Éå ºÉä ºÉÉiÉ xÉMÉ®Éå- +½¨Én É¤ÉÉn , E ÉxÉ{ÉÖ®, ºÉÉä±ÉÉ{ÉÖ®, ±ÉJÉxÉ> , ¤ÉÆMÉ±ÉÖ° , SÉäzÉ<Ç +Éè® ½èn ®É¤ÉÉn E Ò E ÉªÉÇªÉÉäVÉxÉÉ+ÉäÆ E Ò {ÉªÉÉÇ´É®hÉ |Én Ú¹ÉhÉ (‡xÉ´ÉÉ®hÉ B´ÉÆ ‡xÉªÉÆjÉhÉ) |ÉÉ‡vÉE ®hÉ (<Ç{ÉÒºÉÒB) uÉ®É ºÉ¨ÉÒIÉÉ E Ò VÉÉ ®½ Ò ½ è * E Éä±ÉE ÉiÉÉ +Éè® ¨ÉÖ¨¤É<Ç E Ò E ÉªÉÇªÉÉäVÉxÉÉ+ÉäÆ E É ºÉ¨¤ÉÆ‡vÉiÉ =SSÉ xªÉÉªÉÉ±ÉªÉÉå®ÉVªÉ |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ ¤ÉÉäb ÉÃç uÉ®É ºÉ¨ÉÒIÉÉ E Ò VÉÉ ®½Ò ½ è * „Éä¹É ºÉÉiÉ xÉMÉ®Éå--+ÉMÉ®É, ZÉ‡®ªÉÉ, ´ÉÉ®ÉhÉºÉÒ, ¡ ®Òn É¤ÉÉn , {É] xÉÉ, VÉÉävÉ{ÉÖ® +Éè® {ÉÖhÉä E Ò E ÉªÉÇªÉÉäVÉxÉÉ+ÉäÆ E Ò ºÉ¨ÉÒIÉÉ {ÉªÉÉÇ´É®hÉ +Éè® ´ÉxÉ ¨ÉÆjÉÉ±ÉªÉ E ® ®½ É ½è * ºÉÒ{ÉÒºÉÒ¤ÉÒ xÉä ´ÉÉªÉÖ¨ÉÆb±É E Ò MÉÖhÉ´ÉkÉÉ E Ò ‡xÉMÉ®ÉxÉÒ Eä ‡±ÉB ‡n„ÉÉ-‡xÉn æ„É |ÉE É‡„ÉiÉ ‡E B ½ é * ‡n „ÉÉ-‡xÉn æ„ÉÉå ¨Éå ´ÉÉªÉÖ |ÉnÚ¹ÉE Éå E Éä ¨ÉÉ{ÉxÉä E Ò ‡´É‡vÉªÉÉÆ, ºlÉ±É (±ÉÉäEä „ÉxÉ) ‡xÉMÉ®ÉxÉÒ Eä xpÉå Eä ‡±ÉB {Ér‡iÉªÉÉå E É ‡´É´É®hÉ ‡n ªÉÉ MÉªÉÉ ½ è * ‡xÉMÉ®ÉxÉÒ |ÉhÉÉ±ÉÒ ¨Éå BE ° {ÉiÉÉ ¤ÉxÉÉB ®JÉxÉä ½äiÉÖ ºÉ¦ÉÒ ‡xÉMÉ®ÉxÉÒ BVÉå‡ºÉªÉÉå E Éä ‡n „ÉÉ-‡xÉn æ„É VÉÉ®Ò ‡E B MÉB ½é * ºÉÉäºÉÇ B{ÉÉä„ÉÇxÉ¨Éå] º] b Ò »ÉÉäiÉ |É¦ÉÉVÉxÉ +vªÉªÉxÉ (ºÉÉäºÉÇ B{ÉÉä„ÉÇxÉ¨Éå] º]b Ò) iÉÆjÉ Eä =qä„ªÉÉå ¨Éå =iºÉVÉÇxÉ iÉÉ‡±ÉE É, =iºÉVÉÇxÉ E Ò ° {É®äJÉÉ, ´ÉÉªÉÖ¨ÉÆb ±É MÉÖhÉ´ÉkÉÉ E Ò ‡xÉMÉ®ÉxÉÒ, +ÉÆE b Éå E É ¨ÉÚ±ªÉÆE xÉ +Éè® =xÉE Ò |ÉÉ¨ÉÉ‡hÉE iÉÉ ‡ºÉr E ®xÉÉ iÉlÉÉ PÉ]E ‡´É„±Éä¹ÉhÉ +Éè® +‡vÉOÉÉ½Ò |ÉÉn „ÉÇ E É <ºiÉä¨ÉÉ±É E ®iÉä ½ÖB ¤ÉÉ®ÒE {ÉÚhÉÇ+É®BºÉ{ÉÒB¨É E É »ÉÉäiÉ |É¦ÉÉVÉxÉ ºÉ‡¨¨É‡±ÉiÉ ½ è * +vªÉªÉxÉ ¨Éå ®ÉºÉÉªÉ‡xÉE {É‡®¨ÉÉhÉ ºÉÆiÉÖ±ÉxÉ, +‡¦ÉOÉÉ½ Ò |ÉÉn„ÉÇ +Éè® +É<ÇBºÉºÉÒ ‡´ÉºÉVÉÇxÉ |ÉÉn„ÉÇ Eä ={ÉªÉÉäMÉ E Éä ¦ÉÒ „ÉÉ‡¨É±É ‡E ªÉÉ MÉªÉÉ ½ è * ªÉ½ +vªÉªÉxÉ ºÉÆ¤ÉÆ‡vÉiÉ xÉMÉ®Éå Eä ‡±ÉB ={ÉªÉÖH ´ÉÉªÉÖ MÉÖhÉ´ÉkÉÉ |É¤ÉÆvÉxÉ E Ò iÉE xÉÒE ‡xÉvÉÉÇ‡®iÉ E ®äMÉÉ +Éè® ®É¹] ÅÒªÉ ´ÉÉªÉÖMÉÖhÉ´ÉkÉÉ |É¤ÉÆvÉxÉ xÉÒ‡iÉ E Éä ¤ÉxÉÉxÉä ¨Éå ‡n„ÉÉ-‡xÉn æ„É E É +ÉvÉÉ® iÉèªÉÉ® E ®äMÉÉ * E É¤ÉÇ‡xÉE ®ºÉÉªÉxÉ Eä E hÉÒªÉ {ÉnÉlÉÉç Eä SÉ‡®jÉ-‡SÉjÉhÉ Eä ‡±ÉB BE +vªÉªÉxÉ +±ÉMÉ ºÉä ‡E ªÉÉ VÉÉ ®½ É ½è * <ºÉEä ºÉÉlÉ-ºÉÉlÉ, ´ÉÉªÉÖ¨ÉÆb±É ¨Éå E hÉÒªÉ {ÉnÉlÉÉç Eä ‡´É‡¦ÉzÉ »ÉÉäiÉÉå Eä ªÉÉäMÉnÉxÉ Eä |É‡iÉ„ÉiÉ E É {ÉiÉÉ ±ÉMÉÉxÉä 6 „É½ ®Éå Eä ´ÉÉªÉÖ¨ÉÆb±É ¨Éå ¨ÉÉèVÉÚn ¤ÉÉ®ÒE E hÉÒªÉ {Én ÉlÉÉç Eä »ÉÉäiÉ |É¦ÉÉVÉxÉ (BºÉB) E É ‡´ÉºiÉÞiÉ +vªÉªÉxÉ ¦ÉÒ „ÉÖ° ‡E ªÉÉ MÉªÉÉ ½ è * ´ÉÉªÉÖ MÉÖhÉ´ÉkÉÉ ¨Éå ‡´É‡¦ÉzÉ »ÉÉäiÉÉå Eä ªÉÉäMÉn ÉxÉ E É ¨ÉÚ±ªÉÉÆE xÉ E ®xÉä Eä ‡±ÉB +MÉºiÉ, 2003 ¨Éå iÉä±É E Æ{É‡xÉªÉÉå xÉä »ÉÉäiÉ |É¦ÉÉVÉxÉ +vªÉªÉxÉ E Ò {É½ ±É E Ò lÉÒ * <ºÉEä ‡±ÉB ¦ÉÉ®iÉÒªÉ iÉä±É ‡xÉMÉ¨É (+É<Ç+ÉäºÉÒ) +Éè® ®É¹] ÅÒªÉ {ÉªÉÉÇ´É®hÉ +‡¦ÉªÉÉÆ‡jÉE Ò +xÉÖºÉÆvÉÉxÉ ºÉÆºlÉÉxÉ (BxÉ<Ç<Ç+É®+É<Ç-xÉ®Ò) Eä ¤ÉÒSÉ ‡n ±±ÉÒ ¨Éå +vªÉªÉxÉ Eä ‡±ÉB BE ºÉ¨ÉZÉÉèiÉÉ YÉÉ{ÉxÉ {É® ½ºiÉÉIÉ® ‡E ªÉÉ MÉªÉÉ lÉÉ * ¤ÉÉn ¨Éå <ºÉE É ‡´ÉºiÉÉ® E ® <ºÉ¨Éå ‡´É‡¦ÉzÉ ºÉÆºlÉÉ+ÉäÆ Eä ºÉÉlÉ U ½ +Éè® „É½ ®Éå E Éä ¦ÉÒ „ÉÉ‡¨É±É E ® ‡±ÉªÉÉ MÉªÉÉ * <ºÉ ºÉ¨ÉÚSÉä E ÉªÉÇ {É® 20 E ®Éäc ¯ {ÉªÉä JÉSÉÇ ½ÉäxÉä lÉä * <ºÉ +vªÉªÉxÉ E É ºÉ¨Éx´ÉªÉ Eä xpÒªÉ {Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ ¤ÉÉäb Ç (ÃºÉÒ{ÉÒºÉÒ¤ÉÒ) E ® ®½ É ½è * Copyright © 2009 | WWW.UPSCPORTAL.COM 72

Section -1 (Hindi Article : Climate Change) PÉ]xÉÉ+ÉäÆ-VÉèºÉä ±ÉÚ SÉ±ÉxÉä +Éè® ¦ÉÉ®Ò ´É¹ÉÉÇ ½ ÉäxÉä, E Ò +É´ÉÞ‡iiÉ, +´É‡vÉ +Éè® iÉÒµÉiÉÉ ¨ÉäÆ ¤Én ±ÉÉ´É +ÉB ½é* VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ ºÉä ¨ÉÉxÉ´É º´ÉÉºlªÉ E Éä ®ÉäMÉ´ÉÉ½ E ÉäÆ (¨ÉSU ® +É‡n ) ºÉä ¡è ±ÉxÉä ´ÉÉ±ÉÒ ¤ÉÒ¨ÉÉ‡®ªÉÉäÆ E É JÉiÉ®É ¦ÉÒ ¤Ég VÉÉBMÉÉ* VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ E É ‡´ÉE ÉºÉ„ÉÒ±É n ä„ÉÉäÆ {É® ‡´É¹É¨ÉiÉÉ{ÉÚhÉÇ n Ö¹|É¦ÉÉ´É {ÉcäMÉÉ +Éè® <ºÉºÉä º´ÉÉºlªÉ IÉäjÉ, ¦ÉÉäVÉxÉ, º´ÉSU VÉ±É +Éè® +xªÉ ºÉÆºÉÉvÉxÉÉäÆ iÉE {É½ ÖÆSÉ Eä ¨ÉÉ¨É±Éä ¨ÉäÆ {É½ ±Éä ºÉä VÉÉ®Ò +ºÉ¨ÉÉxÉiÉÉBÆ +Éè® ¦ÉÒ ¤Ég VÉÉªÉäÆMÉÒ* ¦ÉÉ®iÉ VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ Eä ¨ÉÉ¨É±Éä ¨ÉäÆ ‡´É„Éä¹É iÉÉè® {É® MÉÆÆ¦ÉÒ® ° {É ºÉä ‡SÉÆ‡iÉiÉ ½ è CªÉÉäÆ‡E ´É½ VÉ±É´ÉÉªÉÖ E Ò o ‡¹] ºÉä +ÉVÉÒ‡´ÉE É Eä ‡±ÉB EÞ ‡¹É B´ÉÆ ¨ÉÉ‡xÉE Ò VÉèºÉä IÉäjÉÉäÆ {É® ‡xÉ¦ÉÇ® ½ è, VÉÉä VÉ±É´ÉÉªÉÖ E Ò o‡¹] ºÉä +iªÉÆiÉ ºÉÆ´Éän xÉ„ÉÒ±É ½ è* +vªÉªÉxÉ Eä nÉè®ÉxÉ ¨ÉÚ±ªÉÉÆE xÉ +Éè® ‡nMn „ÉÇxÉ Eä ‡±ÉB ºÉ‡SÉ´É, ´ÉxÉ B´ÉÆ {ÉªÉÉÇ´É®hÉ (<ÇBÆbB¡ ) E Ò +vªÉIÉiÉÉ ¨Éå ®É¹]ÅÒªÉ ºiÉ® E Ò ºÉÆSÉÉ±ÉxÉ ºÉ‡¨É‡iÉ E É MÉ` xÉ ‡E ªÉÉ MÉªÉÉ ½ è * iÉE xÉÒE Ò VÉÉxÉE É®Ò |ÉnÉxÉ E ®xÉä Eä ‡±ÉB ºÉÒ{ÉÒºÉÒ¤ÉÒ Eä +vªÉIÉ E Ò +vªÉIÉiÉÉ ¨Éå BE iÉE xÉÒE Ò ºÉ‡¨É‡iÉ E É MÉ` xÉ ‡E ªÉÉ MÉªÉÉ ½ è * <ºÉEä ºÉnºªÉÉå ¨Éå ‡´É‡¦ÉzÉ iÉE xÉÒE Ò ºÉÆºlÉÉ+ÉäÆ +Éè® ºÉÆMÉ` xÉÉå Eä ‡´É„Éä¹ÉYÉÉå E Éä „ÉÉ‡¨É±É ‡E ªÉÉ MÉªÉÉ ½ è * iÉE xÉÒE Ò ºÉ‡¨É‡iÉ xÉä ‡´É‡¦ÉzÉ +vªÉªÉxÉÉå, ºÉ´ÉæIÉhÉÉå, o ‡¹]E ÉähÉ, E ÉªÉÇ‡´É‡vÉ, E ÉªÉÇ ªÉÉäVÉxÉÉ +Éè® +xªÉ +É´É„ªÉE |ÉhÉÉ‡±ÉªÉÉå Eä ‡±ÉB „ÉiÉÉç E É +xÉÖ¨ÉÉänxÉ E ® ‡nªÉÉ ½è * ºÉÒ{ÉÒºÉÒ¤ÉÒ xÉä ¨ÉÖ¨¤É<Ç, SÉäzÉ<Ç +Éè® E ÉxÉ{ÉÖ® Eä »ÉÉäiÉ |É¦ÉÉVÉxÉ +vªÉªÉxÉ Eä ‡±ÉB G ¨É„É: xÉÒ®Ò (BxÉ<Ç<Ç+É®+É<Ç), +É<Ç+É<Ç] Ò-¨ÉÖ¨¤É<Ç +Éè® +É<Ç+É<Ç]Ò E ÉxÉ{ÉÖ® Eä ºÉÉlÉ ºÉ½ ªÉÉäMÉ Eä ºÉ¨ÉZÉÉèiÉä (B¨É+ÉäºÉÒ) {É® ½ºiÉÉIÉ® E ®xÉä Eä ºÉÉlÉ ½Ò ´ÉÉ½ xÉÉå Eä +±ÉÉ´ÉÉ +xªÉ »ÉÉäiÉÉå E Ò ºÉÉäºÉÇ |ÉÉä¡ É<Ë±ÉMÉ Eä ‡±ÉB +É<Ç+É<Ç]Ò ¨ÉÖ¨¤É<Ç Eä ºÉÉlÉ ºÉ¨ÉZÉÉèiÉÉ ‡E ªÉÉ ½ è * ¦ÉÉ®iÉÒªÉ ´ÉÉ½ xÉ +xÉÖºÉÆvÉÉxÉ BºÉÉä‡ºÉªÉä„ÉxÉ (B+É®B+É<Ç), {ÉÖhÉä xÉä +vªÉªÉxÉ ¨Éå +É´É„ªÉE VÉÉxÉE É®Ò Eä iÉÉè® {É® ´ÉÉ½xÉÉå Eä ‡±ÉB =iºÉVÉÇxÉ E É®E Éå {É® +vªÉªÉxÉ ‡E ªÉÉ ½è * <ºÉ +vªÉªÉxÉ ºÉä |ÉÉ{iÉ ‡xÉ¹E ¹ÉÉç E É ¨ÉÚ±ªÉÉÆE xÉ iÉE xÉÒE Ò ºÉ‡¨É‡iÉ E ®äMÉÒ +Éè® +xiÉ®®É¹] ÅÒªÉ ºiÉ® E Ò ºÉ¨ÉE IÉ ºÉ‡¨É‡iÉ ºÉä <ºÉE Ò ºÉ¨ÉÒIÉÉ E ®ÉªÉä VÉÉxÉä E É |ÉºiÉÉ´É ½è * <xÉ ={ÉÉªÉÉå E É |ÉºiÉÉ´É <ºÉ‡±ÉB ‡E ªÉÉ MÉªÉÉ ½è CªÉÉå‡E <ºÉ iÉ®½ E É »ÉÉäiÉ |É¦ÉÉVÉxÉ +vªÉªÉxÉ ¦ÉÉ®iÉ ¨Éå {É½±ÉÒ ¤ÉÉ® ‡E ªÉÉ MÉªÉÉ ½ è +Éè® <ºÉ +vªÉªÉxÉ E É ‡xÉ¹E ¹ÉÇ ¦ÉÉ´ÉÒ xÉÒ‡iÉMÉiÉ ‡xÉhÉÇªÉÉå E É +ÉvÉÉ® iÉèªÉÉ® E ®äMÉÉ * ´ÉÉ½xÉ-<ÈvÉxÉ xÉÒ‡iÉ {Éä] ÅÉä‡±ÉªÉ¨É +Éè® |ÉÉEÞ ‡iÉE MÉèºÉ ¨ÉÆjÉÉ±ÉªÉ xÉä BE ´ÉÉ½ xÉ <ÈvÉxÉ xÉÒ‡iÉ (+É] Éä {É> ªÉÚ±É {ÉÉ‡±ÉºÉÒ) E É |É‡iÉ{ÉÉnxÉ ‡E ªÉÉ ½è, ‡VÉºÉE É =qä„ªÉ ´ÉÉ½ xÉ ºÉÆ¤ÉÆvÉÒ =iºÉVÉÇxÉÉå, ´ÉÉ½ xÉ |ÉÉètÉä‡MÉ‡E ªÉÉå +Éè® ´ÉÉ½xÉ <ÈvÉxÉ MÉÖhÉ´ÉkÉÉ E Ò ºÉ¨ÉºªÉÉ+ÉäÆ E É E ¨É JÉSÉÇ {É® ´ªÉÉ{ÉE +Éè® ºÉ¨ÉOÉ ° {É ºÉä +vªÉªÉxÉ E ®xÉä Eä ºÉÉlÉ-ºÉÉlÉ <ÈvÉxÉ +É{ÉÚ‡iÉÇ E Ò ºÉÖ®IÉÉ ºÉÖ‡xÉ‡„SÉiÉ E ®xÉÉ ½ è* xÉÒ‡iÉ Eä =qä„ªÉÉå ¨Éå <ÈvÉxÉ E Ò ºlÉÉªÉÒ, ºÉÖ®‡IÉiÉ, E ¨É JÉSÉÔ±ÉÒ +Éè® ‡xÉ¤ÉÉÇvÉ +É{ÉÚ‡iÉÇ ºÉÖ‡xÉ‡„SÉiÉ E ®xÉÉ, E SSÉä iÉä±É +Éè® E SSÉä iÉä±É Eä =i{ÉÉnÉå Eä +ÉªÉÉiÉ E Ò ºÉÆ®SÉxÉÉ E É +‡vÉE iÉ¨É ={ÉªÉÉäMÉ, |ÉºÉÆºE ®hÉ +Éè® =i{ÉÉn xÉ, ¦ÉÆb É®hÉ +Éè® {É‡®´É½xÉ, ºÉÉ´ÉÇVÉ‡xÉE º´ÉÉºlªÉ E Ò o ‡¹] ºÉä =iºÉVÉÇxÉ +Éè® ´ÉÉªÉÖ MÉÖhÉ´ÉkÉÉ +É´É„ªÉE iÉÉ+ÉäÆ E Ò ¦ÉÉ´ÉÒ |É´ÉÞ‡kÉªÉÉå E É +ÉE ±ÉxÉ iÉlÉÉ ´ÉÉ½xÉ =iºÉVÉÇxÉ Eä BäºÉä ¨ÉÉxÉE Éå E Éä +{ÉxÉÉxÉÉ „ÉÉ‡¨É±É ½è, VÉÉä ´ÉÉªÉÖ MÉÖhÉ´ÉkÉÉ {É® ‡xÉhÉÉÇªÉE |É¦ÉÉ´É bÉ±É ºÉEå * xÉÒ‡iÉ ¨Éå xÉB ´ÉÉ½ xÉÉå Eä ‡±ÉB =iºÉVÉÇxÉ ¨Éå E ¨ÉÒ ±ÉÉxÉä Eä ºÉÉlÉ-ºÉÉlÉ <ºiÉä¨ÉÉ±É ½ Éä ®½ ä ´ÉÉ½xÉÉå Eä =iºÉVÉÇxÉ ¨Éå ¦ÉÒ E ¨ÉÒ ±ÉÉxÉä E Ò ° {É®äJÉÉ n Ò MÉ<Ç ½è* <ºÉ¨Éå <ÈvÉxÉ E Ò MÉÖhÉ´ÉkÉÉ +Éè® +xªÉ ={ÉE ®hÉÉå Eä ‡±ÉB ¦ÉÒ ¨ÉÉxÉE ‡xÉvÉÉÇ‡®iÉ ‡E ªÉä MÉB ½é * ¦ÉÚ‡´ÉYÉÉxÉ ¡ Éä® ¨É ¦ÉÉ®iÉ ¨ÉäÆ VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ {É® ‡´É‡´ÉvÉ ‡½ iÉvÉÉ®E ÉäÆ Eä ¤ÉÒSÉ ºÉÚSÉxÉÉ E É ´ÉÉiÉÉ´É®hÉ ¤ÉxÉÉxÉä Eä ‡±ÉB +Éè® ‡´É‡´ÉvÉ |É‡iÉ‡xÉ‡vÉªÉÉäÆ E Éä ºÉ´ÉÉækÉÉ¨É |É‡G ªÉÉ+ÉäÆ E Éä +É{ÉºÉ ¨ÉäÆ ¤ÉÉÆ] E ® B´ÉÆ BE -n ÚºÉ®ä iÉE {É½ ÖÄSÉÉE ® BE ºÉÉlÉ E É¨É E ®xÉä Eä ‡±ÉB |ÉÉäiºÉÉ‡½ iÉ E ®xÉä Eä ‡±ÉB ‡´ÉYÉÉxÉ B´ÉÆ |ÉÉètÉä‡MÉE Ò ¨ÉÆjÉÉ±ÉªÉ +Éè® ¦ÉÚ‡´ÉYÉÉxÉ ¨ÉÆjÉÉ±ÉªÉ +Éè® BSÉ.BºÉ.¤ÉÒ.ºÉÒ. <Æ‡b ªÉÉ xÉä "¦ÉÚ‡´ÉYÉÉxÉ ¡ Éä®¨É' Eä xÉÉ¨É ºÉä YÉÉiÉ BE ¡ Éä®¨É E É ‡xÉ¨ÉÉÇhÉ E ®iÉä ½ÖB ‡n±±ÉÒ ¨ÉäÆ BE ºÉ½ ¨É‡iÉ {ÉjÉ {É® ½ ºiÉÉIÉ® ‡E ªÉÉ ½ è*<ºÉ ¡ Éä®¨É Eä iÉ½ iÉ VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ xÉäiÉÞi´É {É‡®¹Én VÉ±É´ÉÉªÉÖ {É‡®´ÉiÉÇxÉ E É E ÉäºÉÇ ¤ÉxÉÉxÉä Eä ‡±ÉB BE ´É¹ÉÇ ¨ÉäÆ E ¨É ºÉä E ¨É n Éä ¤ÉÉ® ‡¨É±ÉäMÉÉ +Éè® <ºÉ¨ÉäÆ =tÉäMÉ, ºÉ®E É®, ‡„ÉIÉÉ +Éè® MÉè® ºÉ®E É®Ò ºÉÆMÉ`xÉÉäÆ Eä Copyright © 2009 | WWW.UPSCPORTAL.COM 73

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Section -1 (Hindi Article : Climate Change) ±ÉMÉÉ+Éä, {ÉªÉÉÇ´É®hÉ +Éè® |ÉnÚ¹ÉhÉ +É‡n ºÉä ºÉÆ¤ÉÆ‡vÉiÉ ºÉÆ‡IÉ{iÉ ‡E xiÉÖ |É¦ÉÉ´É„ÉÉ±ÉÒ ºÉÆn ä„ÉÉå E Éä VÉxÉºÉÉ¨ÉÉxªÉ Eä ¨ÉvªÉ ºÉ¨|Éä‡¹ÉiÉ ‡E ªÉÉ VÉÉ ºÉE iÉÉ ½è * <±ÉäC] ÅÉ‡xÉE ¨ÉÒ‡bªÉÉ E Ò ¦ÉÚ‡¨ÉE É: <±ÉäC] ÅÉ‡xÉE ¨ÉÒ‡b ªÉÉ Eä +ÆiÉMÉÇiÉ ®ä‡bªÉÉä, ] ä±ÉÒ‡´ÉVÉxÉ, ‡¡ ±¨É, ¨É±] Ò ¨ÉÒ‡bªÉÉ +Éè® +Éì‡b ªÉÉä-´ÉÒ‡b ªÉÉä, º±ÉÉ<b , ‡xÉ+ÉäxÉ ºÉÉ<xÉ +ÉiÉä ½é * ®ä‡b ªÉÉä Eä ¨ÉÉvªÉ¨É ºÉä ‡„ÉIÉÉ, ºÉÚSÉxÉÉ +Éè® ¨ÉxÉÉä®ÆVÉxÉ ºÉ¨|Éä‡¹ÉiÉ ½ÉäiÉÉ ½ è* <ºÉ ¨ÉÉvªÉ¨É ºÉä ºÉÉ¨ÉÉxªÉ VÉxÉ iÉE {ÉªÉÉÇ´É®hÉ, {ÉªÉÉÇ´É®hÉ ºÉÆ®IÉhÉ, {ÉªÉÉÇ´É®hÉ |Én Ú¹ÉhÉ, {ÉªÉÉÇ´É®hÉ ‡„ÉIÉÉ, ´ÉxªÉ VÉÒ´É ºÉÖ®IÉÉ B´ÉÆ ºÉÆ®IÉhÉ, {Éäc ±ÉMÉÉ+Éä +‡¦ÉªÉÉxÉ E ÉªÉÇG ¨ÉÉå ºÉä ºÉÆ¤ÉÆ‡vÉiÉ VÉÉxÉE É®Ò +ÉºÉÉxÉÒ ºÉä ¦ÉäVÉÒ VÉÉ ºÉE iÉÒ ½é * ¦ÉÉ®iÉ ¨Éå ¨ÉÖ¨¤É<Ç ¨Éå ®ä‡bªÉÉä C±É¤É uÉ®É VÉÚxÉ, 1923 ¨Éå |ÉlÉ¨É ¤ÉÉ® |ÉºÉÉ®hÉ ½ Ö+É lÉÉ * +ÉE É„É´ÉÉhÉÒ ºÉä ‡´É‡´ÉvÉ |ÉE É® Eä |ÉºÉÉ®hÉ ‡E B VÉÉiÉä ½ é, ‡VÉxÉ¨Éå ºÉÚSÉxÉÉ, ‡„ÉIÉÉ, ¨ÉxÉÉä®ÆVÉxÉ B´ÉÆ ´ªÉÉ{ÉÉ‡®E ‡´ÉYÉÉ{ÉxÉ +É‡n ¨ÉÖJªÉ ½ è * ½ ‡®iÉ G ÉÆ‡iÉ E Éä +ÉMÉä ¤ÉfÉÃxÉä ¨Éå ®ä‡bªÉÉä |ÉºÉÉ®hÉÉå xÉä ¨É½ i´ÉÚhÉÇ ¦ÉÚ‡¨ÉE É ‡xÉ¦ÉÉ<Ç lÉÒ * {ÉªÉÉÇ´É®hÉ ºÉÆ®IÉhÉ ºÉÆ¤ÉÆvÉÒ ®É¹]ÅÒªÉ xÉÒ‡iÉªÉÉå B´ÉÆ E ÉªÉÇG ¨ÉÉå, |Én Ú¹ÉhÉ ‡xÉ´ÉÉ®hÉ Eä ={ÉÉªÉÉå, EÞ ‡¹É +Éè® +ÉètÉä‡MÉE ‡´ÉE ÉºÉ, ºÉiÉiÉ ‡´ÉE ÉºÉ +Éè® {ÉªÉÉÇ´É®hÉÒªÉ VÉÉMÉ¯ E iÉÉ B´ÉÆ ‡„ÉIÉÉ E ÉªÉÇ +É‡n ºÉä ºÉÆ¤ÉÆ‡vÉiÉ ºÉÆn ä„ÉÉå E Éä VÉxÉ-VÉxÉ iÉE {É½ ÖÆSÉÉxÉä ¨Éå ®ä‡bªÉÉä E Ò +{ÉxÉÒ ºÉ„ÉH ¦ÉÚ‡¨ÉE É ½è * n Ú®n „ÉÇxÉ E É ¦ÉÉ®iÉ ¨Éå 15 ‡ºÉiÉ¨¤É®, 1959 E Éä „ÉèIÉ‡hÉE =qä„ªÉÉå Eä ºÉÉlÉ +É®Æ¦É ½ Ö+É * nÚ®n „ÉÇxÉ VÉxÉiÉÉ Eä ¤É½ ÖiÉ E ®Ò¤É ½è * {ÉªÉÉÇ´É®hÉÒªÉ ºÉ¨ÉºªÉÉ+ÉäÆ E Éä E ¨É E ®xÉä ¨Éå <ºÉE Ò ¦ÉÚ‡¨ÉE É E É¡ Ò ½ n iÉE ºÉ½ ÉªÉE ½Éä ºÉE iÉÒ ½ è * E SÉ®ä B´ÉÆ +{É‡„É¹] E É |É¤ÉÆvÉxÉ, |ÉnÚ¹ÉhÉ ‡xÉªÉÆjÉhÉ, ºÉÉ¨ÉÉ‡VÉE ´ÉÉ‡xÉE Ò, ´ÉxªÉ VÉÒ´ÉxÉ ºÉÆ®IÉhÉ, EÞ ‡¹É ‡´ÉE ÉºÉ, VÉ±É +Éè® ¦ÉÚ‡¨É Eä ºÉÆ®IÉhÉ iÉlÉÉ {ÉªÉÉÇ´É®hÉ ºÉÆ®IÉhÉ Eä E ÉxÉÚxÉÉå E É n Ú®n „ÉÇxÉ B´ÉÆ +xªÉ ] ä±ÉÒ‡´ÉVÉxÉ SÉèxÉ±ÉÉå Eä ¨ÉÉvªÉ¨É ºÉä |ÉºÉÉ®hÉ uÉ®É ¨É½ i´É{ÉÚhÉÇ ¦ÉÚ‡¨ÉE É ‡xÉ¦ÉÉ<Ç VÉÉ ºÉE iÉÒ ½è * M±ÉÉä¤É±É ´ÉÉ‡¨ÉÈMÉ +ÉVÉ BE SÉÖxÉÉèiÉÒ Eä ° {É ¨Éå ¨ÉxÉÖ¹ªÉ Eä ºÉ¨¨ÉÖJÉ JÉcÒ ½ è* <ºÉ SÉÖxÉÉèiÉÒ E Éä º´ÉÒE É® E ®iÉä ½ÖB ¨ÉÒ‡b ªÉÉ +É¨É VÉxÉ ¨Éå VÉÉMÉ¯ iÉÉ {ÉènÉ E ®xÉä E É |ÉªÉÉºÉ E ® ®½ É ½è * ‡¡ ±¨É VÉMÉiÉ E Ò ¦ÉÚ‡¨ÉE É ‡¡ ±¨É =tÉäMÉÉå E É <‡iÉ½ ÉºÉ 100 ´É¹ÉÇ {ÉÖ®ÉxÉÉ ½ è* ‡¡ ±¨Éå VÉxÉºÉÉ¨ÉÉxªÉ E Éä ‡„ÉIÉÉ, ºÉÚSÉxÉÉ +Éè® ¨ÉxÉÉä®ÆVÉxÉ |ÉnÉxÉ E ®xÉä E É BE +SU É ¨ÉÉvªÉ¨É ½ è * ‡¡ ±¨É +Éè® SÉ±É‡SÉjÉ Eä ¨ÉÉvªÉ¨É ºÉä {ÉªÉÉÇ´É®hÉ, {ÉªÉÉÇ´É®hÉ |Én Ú¹ÉhÉ, ½ ¨ÉÉ®ä {ÉªÉÉÇ´É®hÉ, ´ÉxÉ B´ÉÆ ´ÉxªÉ VÉÒ´É ºÉÆ®IÉhÉ +É‡n E Ò VÉÉxÉE É®Ò +ÉºÉÉxÉÒ ºÉä n Ò VÉÉ ºÉE iÉÒ ½ è * {ÉªÉÉÇ´É®hÉ {É® b ÉìCªÉÚ¨Éå] ÅÒ B´ÉÆ ¡ ÒSÉ® ‡¡ ±¨Éå ¦ÉÒ ¤ÉxÉÉ<Ç VÉÉiÉÒ ½ é * {ÉªÉÉÇ´É®hÉ ºÉÆ®IÉhÉ, {ÉªÉÉÇ´É®hÉ |Én Ú¹ÉhÉ, ´ÉxªÉ VÉÒ´É ºÉÆ®IÉhÉ +É‡n ‡´É¹ÉªÉÉå ºÉä ºÉÆ¤ÉÆ‡vÉiÉ +‡vÉE ºÉä +‡vÉE ‡¡ ±¨ÉÉå Eä ‡xÉ¨ÉÉÇhÉ E Ò +É´É„ªÉE iÉÉ ½è iÉÉ‡E VÉxÉºÉÉ¨ÉÉxªÉ E Éä ºÉÉlÉÇE VÉÉxÉE É®Ò B´ÉÆ YÉÉxÉ |Én ÉxÉ ‡E ªÉÉ VÉÉ ºÉEä * ºÉÚSÉxÉÉ |ÉÉètÉä‡MÉE Ò E Ò ¦ÉÚ‡¨ÉE É ¦ÉÉ®iÉ ¨Éå <Æ]®xÉä] E É VÉx¨É 15 +MÉºiÉ, 1995 ¨Éå ½Ö+É lÉÉ * iÉ¤É ºÉä ±ÉäE ® ={ÉªÉÉäMÉE iÉÉÇ+ÉäÆ E Ò ºÉÆJªÉÉ ¨Éå ‡xÉ®ÆiÉ® ´ÉÞ‡r ½ Éä ®½ Ò ½ è * {ÉªÉÉÇ´É®hÉ |É¤ÉÆvÉxÉ Eä IÉäjÉ ¨Éå <Æ] ®xÉä] E É ={ÉªÉÉäMÉ ‡´É„´É´ªÉÉ{ÉÒ iÉlªÉÉi¨ÉE VÉÉxÉE É®Ò |Én ÉxÉ E ®xÉä E Ò o‡¹] ºÉä ={ÉªÉÉäMÉÒ ½ è * {ÉªÉÉÇ´É®hÉ Eä ‡´É‡´ÉvÉ {ÉIÉÉå E Ò VÉÉxÉE É®Ò B´ÉÆ +ÉÆE cä <x] ®xÉä] {É® +ÉºÉÉxÉÒ ºÉä |ÉÉ{iÉ ‡E B VÉÉ ºÉE iÉä ½ é * {ÉªÉÉÇ´É®hÉÒªÉ +xÉÖºÉÆvÉÉxÉ, ‡xÉªÉÉäVÉxÉ +Éè® |É¤ÉÆvÉxÉ ¨Éå <ºÉºÉä |ÉÉ{iÉ VÉÉxÉE É®Ò +iªÉÆiÉ ={ÉªÉÉäMÉÒ ‡ºÉr ½ ÉäMÉÒ* ºÉÚSÉxÉÉ |ÉÉètÉä‡MÉE Ò E É BE xÉªÉÉ IÉäjÉ ¨É±] Ò¨ÉÒ‡b ªÉÉ ½ è * <ºÉ¨Éå ±ÉäJÉxÉ ºÉÉ¨ÉOÉÒ, v´É‡xÉ, ´ÉÒ‡bªÉÉä, ‡u+ÉªÉÉ¨ÉÒ ªÉÉ ‡jÉ+ÉªÉÉ¨ÉÒ OÉÉ‡¡ CºÉ +Éè® Copyright © 2009 | WWW.UPSCPORTAL.COM 76

Section -1 (Hindi Article : Climate Change) BxÉÒ¨Éä„ÉxÉ „ÉÉ‡¨É±É ½ é * <ºÉE É =qä„ªÉ ±ÉÉäMÉÉå E Éä BE ‡xÉªÉÆ‡jÉiÉ f ÆMÉ ºÉä VÉÉxÉE É®Ò, ‡„ÉIÉÉ +Éè® ¨ÉxÉÉä®ÆVÉxÉ |Én ÉxÉ E ®xÉÉ ½ è * <ºÉEä ¨ÉÉvªÉ¨É ºÉä VÉè´É ‡´É‡´ÉvÉiÉÉ B´ÉÆ ´ÉxªÉ VÉÒ´ÉxÉ {É® VÉÉxÉE É®Ò ¨ÉxÉÉä®ÆVÉE Eä ºÉÉlÉ ºÉÉlÉ ‡„ÉIÉÉ|Én ¦ÉÒ ¤ÉxÉ VÉÉiÉÒ ½ è * <ºÉEä ¨ÉÉvªÉ¨É ºÉä ªÉ½ ±ÉÉ¦É ½ ÉäiÉÉ ½è ‡E ªÉ‡n ´ÉÉºiÉ‡´ÉE o „ªÉÉå {É® ‡¡ ±¨É ¤ÉxÉÉ<Ç VÉÉB iÉÉä ±ÉÉMÉiÉ E <Ç MÉÖxÉÉ +ÉiÉÒ ½è, VÉ¤É‡E ¨É±] Ò¨ÉÒ‡bªÉÉ ºÉä ªÉ½ E ÉªÉÇ ºÉºiÉä ¨Éå B´ÉÆ ºÉ®±ÉiÉÉ ºÉä ºÉ¨{ÉzÉ ½Éä VÉÉiÉÉ ½è * {É® ¨{É® ÉMÉiÉ ¨ÉÉvªÉ¨ÉÉå E Ò ¦ÉÚ‡¨ÉE É {É®¨{É®ÉMÉiÉ ¨ÉÉvªÉ¨É ªÉÉ ±ÉÉäE ¨ÉÉvªÉ¨ÉÉå E Ò VÉcå OÉÉ¨ÉÒhÉ B´ÉÆ +É‡n´ÉÉºÉÒ IÉäjÉÉå ¨Éå MÉ½®Ò {Éè` Ò ½ é * <xÉEä ¨ÉÉvªÉ¨É ºÉä xÉ Eä ´É±É OÉÉ¨ÉÒhÉ VÉxÉ VÉÒ´ÉxÉ E Ò ºÉÉ¨ÉÉ‡VÉE -ºÉÉÆºEÞ ‡iÉE +‡¦É´ªÉ‡H ½ ÉäiÉÒ ½ è ¤É‡±E ªÉä ¨ÉÉvªÉ¨É {ÉªÉÉÇ´É®hÉ ºÉÆ®IÉhÉ +Éè® {ÉªÉÉÇ´É®hÉÒªÉ SÉäiÉxÉÉ Eä |ÉºÉÉ® ¨Éå ¦ÉÒ ºÉ½ÉªÉE ½ Éä ºÉE iÉä ½ é* ±ÉÉäE MÉÒiÉ, ±ÉÉäE ºÉÆMÉÒiÉ, ±ÉÉäE xÉÞiªÉ, xÉÉè]ÆE Ò, E ` {ÉÖiÉ±ÉÒ +É‡n ±ÉÉäE ¨ÉÉvªÉ¨É Eä ºÉÉvÉxÉ ½ é * ªÉä ¨ÉÉvªÉ¨É ¸ÉÉäiÉÉ+ÉäÆ ºÉä ºÉÒvÉÉ ºÉ¨{ÉEÇ ¤ÉxÉÉiÉä ½ é +iÉ: <xÉEä ¨ÉÉvªÉ¨É ºÉä {ÉªÉÉÇ´É®hÉÒªÉ ºÉÚSÉxÉÉ +Éè® ºÉÆn ä„É |É¦ÉÉ´ÉÒ f ÆMÉ ºÉä ºÉ¨|Éä‡¹ÉiÉ ½Éä VÉÉiÉä ½ é* <xÉE É ={ÉªÉÉäMÉ xÉMÉ®Éå E Ò +{ÉäIÉÉ MÉÉÆ´ÉÉå ¨Éå +ÉºÉÉxÉÒ ºÉä ‡E ªÉÉ VÉÉ ºÉE iÉÉ ½è CªÉÉå ‡E ªÉä =xÉE Ò {É®¨{É®ÉMÉiÉ ¨ÉÉvªÉ¨É ±ÉÉäE ºÉÆºEÞ ‡iÉ E Ò +‡¦É´ªÉ‡H Eä ºÉ„ÉH ¨ÉÉvªÉ¨É ½ ÉäiÉä ½é * {ÉªÉÉÇ´É®hÉ ºÉÆ®IÉhÉ Eä |É‡iÉ ºÉ¨ÉªÉ-ºÉ¨ÉªÉ {É® ‡E B MÉB |ÉªÉÉºÉÉå Eä ¡ ±Éº´É° {É ‡{ÉU ±Éä ´É¹ÉÉç ¨Éå ¦ÉÉ®iÉ ¨Éå E <Ç {ÉªÉÉÇ´É®hÉÒªÉ +ÉÆn Éä±ÉxÉÉå E É VÉx¨É ½ Ö+É * ¨ÉÒ‡b ªÉÉ xÉä <xÉ +ÉÆn Éä±ÉxÉÉå E Éä ´ªÉÉ{ÉE ºlÉÉxÉ ‡n ªÉÉ +Éè® <xÉEä =qä„ªÉÉå ºÉä VÉxÉiÉÉ E Éä +´ÉMÉiÉ E ®ÉªÉÉ * ªÉä +ÉÆn Éä±ÉxÉ ½ é - ‡SÉ{ÉE Éä +ÉÆn Éä±ÉxÉ, xÉ¨ÉÇnÉ ¤ÉSÉÉ+Éä +ÉÆn Éä±ÉxÉ, ] ä½®Ò ¤ÉÉÆvÉ ‡´É®ÉävÉÒ +ÉÆn Éä±ÉxÉ, ¨ÉÚE PÉÉ]Ò, B‡{{ÉE Éä +ÉÆn Éä±ÉxÉ, ¦ÉÉä{ÉÉ±É MÉèºÉ jÉÉºÉn Ò, ‡´É¹hÉÖ |ÉªÉÉMÉ ¤ÉÉÆvÉ, ‡SÉ‡±ÉE É +ÉÆn Éä±ÉxÉ B´ÉÆ {ÉÉxÉÒ ¤ÉSÉÉ+Éä +ÉÆn Éä±ÉxÉ +Éè® ‡n ±±ÉÒ E É ´ÉÉªÉÖ |Én Ú¹ÉhÉ ‡xÉªÉÆjÉhÉ +É‡n * ¨ÉÒ‡bªÉÉ E Éä ªÉ½ ¤ÉÉiÉ vªÉÉxÉ ¨Éå ®JÉxÉÒ ½ ÉäMÉÒ ‡E ´Éä +{ÉxÉÒ ¤ÉÉiÉ ºÉ¨ÉÉVÉ Eä ‡E ºÉ ´ÉMÉÇ E Éä ‡E ºÉ ¨ÉÉvªÉ¨É Eä VÉ‡®B {É½ ÖÆSÉÉ ®½ ä ½é * =x½ å VÉ½ ÉÆ {ÉªÉÉÇ´É®hÉ ºÉÆ®IÉhÉ Eä ‡±ÉB ¤ÉxÉÉB MÉB ‡xÉªÉ¨ÉÉå E Ò +´É½ ä±ÉxÉÉ E ®xÉä ´ÉÉ±ÉÒ PÉ]xÉÉ+ÉäÆ E Éä ºÉÉ¨ÉxÉä ±ÉÉxÉÉ ½ ÉäMÉÉ, ´É½Ó VÉÉä ºÉÆºlÉÉBÆ {ÉªÉÉÇ´É®hÉ ºÉÆ®IÉhÉ Eä ‡±ÉB +SU É E É¨É E ® ®½Ò ½ é =xÉEä E ÉªÉÉç E Éä ¦ÉÒ =VÉÉMÉ® E ®xÉÉ ½ ÉäMÉÉ * ªÉ½ ‡xÉ‡´ÉÇ´ÉÉn ºÉiªÉ ½ è ‡E E ÉxÉÚxÉ, ={Én ä„É +Éè® n ¤ÉÉ´É E Ò iÉÖ±ÉxÉÉ ¨Éå ¨ÉÒ‡b ªÉÉ {ÉªÉÉÇ´É®hÉ ºÉÆ¤ÉÆvÉÒ VÉxÉSÉäiÉxÉÉ VÉMÉÉxÉä E Ò o‡¹] ºÉä E É¡ Ò E É®MÉ® ‡ºÉr ½ Éä ºÉE iÉÉ ½è * Advertise your Business Here Contact Us Online: http://upscportal.com/store/contact Copyright © 2009 | WWW.UPSCPORTAL.COM 77

Section -2 (Hot Topics : Arihant Class Submarine) Arihant Class Submarine Indian Navy’s Advanced Technology Vessel The Arihant class submarines are nuclear-powered that the hulls for two more vessels were completed ballistic missile submarines of the Indian navy. The at the L&T facility at Hazira and will be transported lead vessel of the class, INS Arihant, was launched to Visakhapatnam as INS Arihant has been moved on July 26, 2009. The Arihant Class of submarines from the dry dock. may carry the Sagarika submarine-launched ballistic missile (SLBM) or the BrahMos Inside Information supersonic cruise missile. The Arihant class may possibly be armed with the The Arihant class 750 km Sagarika, subma- vessels were de- rine-launched ballistic mis- signed as a part sile and Agni-3(missile), of the Advanced an SLBM under develop- Technology Ves- ment. sel project, India's US$2.9 billion project to design and build The Arihant class hull features twin flank-array so- nuclear-powered submarines. The Arihant class is nars. Although it was widely speculated, the subma- India's first indigenously designed and built submarine does not sport either a "bulb" like towed array rine. 3 submarines of the class are expected to be in sonar, or a low blended sail. This lays rest to the commission with the Indian navy by 2015. assumption that the design was inspired by the Rus- sian Akula (NATO) subs. The glimpses of the sub- Evolution marine provided to the media seems to indicate a design closer to the Charlie I class, with a blended The Arihant class submarines were designed and hump behind the sail for the vertical launchers. The constructed as a part of the Indian navy's Advanced class also features a broadband expendable anti-tor- Technology Vessel (ATV) project. The ATV project pedo countermeasures developed by RAFAEL of started with the intent to design nuclear-powered fast Israel. It is likely that the vertical launchers, 4 in num- attack submarines, though over time the project was ber, will be fitted with 3 K-15 missiles each, making re-aligned towards the design of a ballistic missile the submarine capable of carrying a total of 12 weap- submarine in order to complete India's nuclear triad. ons. The larger and longer ranged Agni III SLBM is The vessels are powered by an 80 MW pressurized under development, of which the Arihant will carry water reactor (PWR) with enriched uranium fuel. The 4. initial design of the miniaturized naval-version of the Description reactor developed by the Bhabha atomic research centre (BARC) had technical challenges, after which A nuclear-powered submarine is a much more com- Russian help was sought to resolve the design plex platform than any other vessel and India build- glitches. The final production version of the reactor ing one on its own is a great achievement. What en- was built at the Indira Gandhi center for atomic re- hances the scale of the achievement is that INS search (IGCAR) at Kalpakkam. Arihant, India’s nuclear-powered submarine, will be fitted with India’s own K-15 ballistic missiles that The hulls for this class are built by L&T’s Hazira can be launched from under water. The K-15 mis- shipbuilding facility. Tata power built the control siles, which are already under production, can carry systems for the submarine. The systems for the steam both conventional and nuclear warheads. They have turbine integrated with the PWR were supplied by a range of 700 km. They are 10.4 metres tall and Walchandnagar Industries. Reports have suggested weigh 6.3 tonnes each. Copyright © 2009 | WWW.UPSCPORTAL.COM 79

Section -2 (Hot Topics : Arihant Class Submarine) Indian Current Capabilities It means India can launch missiles with nuclear warheads from ground, drop nuclear bombs from air and The Indian Navy currently deploys 16 submarines, also fire them now from under water.A nuclear-pow- which are based at Vishakhapatnam on the east coast ered submarine bestowed on India the status of a and Mumbai on the west coast. A third base is being nation possessing a blue-water navy because the boat built on the west coast at Karwar as well. The most can travel far and wide. While the Navy designed modern vessels are four Shishumar-class Type 209/ INS Arihant, the Bhabha Atomic Research Centre 1500 units designed by Howaldtswerke-Deutsche (BARC) built the mini-nuclear reactor that powers Werft(HWD). Ten Sindhugosh-class Type 877EM the submarine, the DRDO developed the K-15 mis- vessels form the backbone of the submarine force siles. The K-15 missiles have been test-fired several and are being upgraded to launch Klub/3M-54E Alfa times from submerged pontoons off the coast of cruise missiles. Two aging Foxtrot-class boats are in Visakhapatnam. A missile emerging from the water the process of being decommissioned and will be without losing its fire was a technology in itself. replaced with six Scorpène-class boats. India expects A distinct advantage of a nuclear-powered subma- to float a tender on six more diesel submarines in rine is that while it can remain under water for a long 2009. duration, a diesel-fired submarine has to rise to the surface every day for ejecting the carbon-dioxide For the past two decades, India has also been work- produced by the diesel-generator. Otherwise, the ing on the development of an indigenous nuclear- boat’s crew will face problem. propelled submarine, referred to as the advanced technology vessel (ATV). The ATV submarine, work In a nuclear-energy system used in a submarine, there on which began in the 1970s, is a complex project is no emission of carbon-dioxide. It is a clean form that has faced multiple difficulties. Although there of energy. The turbine operating on enriched ura- have been few signs of progress as of late, one ves- nium in INS Arihant is a clean system. But a diesel- sel is reportedly now under construction at Mazagon generator emits carbon-dioxide. It is can not dis- Docks Ltd., with sea trials expected in 2009.Some charge it into the water. So the submarine has to be sources indicate that construction of as many as five brought up to the surface every day to eject the car- nuclear submarines is planned. For the time being, it bon-dioxide into the atmosphere. remains unclear whether the ATV will be fitted with ballistic or cruise missiles; India’s submarine-launched India, now joined a select group of five countries, missile program includes development of both. which possess the capability to build a nuclear-powered submarine. That the construction of a subma- The Indian Navy's area of operation includes the rine was a highly demanding task in itself was known, Arabian Sea, the Indian Ocean, and the Bay of Ben- but for a country to develop its first nuclear subma- gal. These waters include numerous sea lines of com- rine was a special achievement. munication (SLOC) chokepoints, such as the Strait of Hormuz, Bab El Mandeb, and the Malacca The formal launch for sea trials of the platform called Straits. Almost 97% of India's foreign trade by vol- a cryptic ‘S2’ lifted the secrecy around the Advanced ume and 60% of the world's sea-borne trade and Technology Vessel Project cleared for implementa- energy resources are transported through these stra- tion by Indira Gandhi in 1984 and whose first step in tegic bottlenecks. This share of critical global trade steel cutting commenced in 1998. To date the project is likely to be amplified by the growing energy de- is estimated to have cost Rs. 30,000 crore. mands and industrial exports of East and Southeast Asia. Copyright © 2009 | WWW.UPSCPORTAL.COM 80

Section -2 (Hot Topics : Arihant Class Submarine) Consequently, one of the Indian Navy's fundamental cessful conclusion of India's ATV program, with a tasks involves the establishment of sea control to lease of nuclear submarines, or perhaps, to a lesser protect its vital SLOCs. It has traditionally paid par- extent, with the acquisition of air-independent pro- ticular attention to Pakistani Navy developments, as pulsion (AIP) submarines. India has had experience India and Pakistan have had numerous hot and cold leasing a nuclear-powered submarine: from 1988 to conflicts over the years. Gradually, though, the fo- 1991 it leased a Project 670 Skat (NATO name cus of the Indian Navy is shifting to the Chinese Navy, Charlie I) class nuclear-powered cruise missile sub- as acknowledged in the recently publicized Indian marine from the Soviet Union, the K-43 (renamed Maritime Doctrine. This document reiterates earlier Chakra while in Indian service). The reactors were calls for a stronger deterrent capability against for- operated by a Soviet crew and the vessel was re- eign intervention by non-littoral navies. With this in turned to the Soviet Union. Press reports have indi- mind, India has been modernizing its fleet and has cated since 1999 that Russia and India have been been continually interested in procuring nuclear at- negotiating lease of a Project 971 Shchuka B (NATO tack and diesel submarines, establishing two aircraft name Akula II) submarine, likely the K-152 Nerpa, carrier groups, and developing new cruise missiles. as a follow-on to the K-43 lease. Indian officials have repeatedly indicated their concerns over China’s progress on nuclear submarine Given the various tasks and increasing role assigned construction. Deterrence against non-littoral navies to the Indian Navy, an earlier strategic review and is not limited to China, however. The recent and Project 75, a 30-year procurement plan, have alleg- planned acquisitions of naval vessels by a number of edly called for the procurement of 24 submarines to ASEAN nations are also mentioned in the doctrine. "maintain adequate operational force levels." These In addition, the deployment of a US carrier task force boats should be comprised of two locally built sub- to the Bay of Bengal during the 1971 Indo-Pakistani marine classes. On October 6, 2005, India signed a war is unlikely to have been forgotten. As such, the contract with France's Armaris (a joint venture be- continued US presence at Diego Garcia and Bahrain tween France's DCN and Spain's Navantia, formerly may represent a concern to the Indian Navy as well. Izar) for six Scorpène-class vessels with an option Aside from sea control and denial roles, the Indian for an additional six units, to be constructed at the Navy executes counter-terrorism, anti-drug traffick- Mazagon Shipyard in Mumbai. The first boat is to ing, and anti-piracy operations within its area of in- be delivered in 2012, with the rest following over terest. These roles are complicated not only by the the course of five years. India is reportedly consid- great amount of shipping traffic, but also by the size ering the installation of MESMA, the French AIP of India's exclusive economic zone of 2.02 million system, beginning with the third boat/It has been square kilometers, to which 1.5 million square kilo- suggested that the second main production line could meters will be added in 2004 in accordance with in- be a version of the Russian Amur-class; six to eight ternational treaties. The aforementioned choke Amur-1650s are on the Indian Navy's list of pro- points, in particular, represent attractive targets for spective acquisitions as part of its 30-year subma- potential terrorist attacks. rine procurement plan. India's ambitions for a sea-based nuclear deterrent Types of Submarines were acknowledged in 1998. After executing a number of nuclear tests, the government declared that its Diesel Submarines: The Indian Navy currently main- future minimum nuclear deterrent (MND) would be tains a fleet of 16 diesel powered submarines. These based on a triad: a combination of airborne, naval, are primarily of Russian and German origin. India and land-based platforms. The recently released mari- signed a deal for six Scorpene submarines with time doctrine clarifies this still further, calling spe- MESMA air-independent propulsion, and construc- cifically for the establishment of a submarine-based tion has begun. These submarines will join the In- MND. The triad could be completed with the suc- dian Navy from 2010-11 onwards. The Indian Navy Copyright © 2009 | WWW.UPSCPORTAL.COM 81

Section -2 (Hot Topics : Arihant Class Submarine) may arm its Kilo class submarine fleet with the be deployed on the submarine's hull after miniatur- BrahMos cruise missiles after successfully complet- ization. The Prototype Testing Centre (PTC) will be ing test launches from the submarine. India will is- used to test the submarine's turbines and propellers. sue request for proposals for another six submarines A similar facility is operational at Vishakhapatnam in financial year 2008-09. to test the main turbines and gear box. Unmanned Submarines: The National Institute of Once the vessel is completed, it may be equipped Oceanography has developed the Autonomous Un- with Sagarika/Agni-3 ballistic missiles and advanced derwater Vehicle(AUV) that has applications in the Indian made sonar systems. According to defense field of Oceanographic research. Also an Autono- sources, the ATV is expected to be launched in 2009 mous Surface Vehicle (ASV) has been developed. and commissioned in 2010. Each unit will cost one Nuclear Powered Submarines: In January 1988 In- billion U.S. dollars. Government has given approval dia leased for three years an ex-Soviet Charlie class for constructing the follow on SSBN's which will be nuclear powered guided missile submarine with eight larger than the Arihant class submarines. Approval Ametist (SS-N-7 Starbright) anti-shipping missile has also been given for the construction of SSN's launchers. In the Indian Navy, the ship was chris- which will escort the SSBN's. tened INS Chakra, and the submarine was manned by an Indian crew. Upon expiration of the ship leas- India is reportedly paying two billion dollars for the ing term in 1991, the submarine was returned to completion of two Akula-2 class submarines which Russia and joined the Pacific Fleet of the Russian were 40-60% completed. Three hundred Indian Navy Navy. India's indigenously designed and built nuclear- personnel are being trained in Russia for the opera- powered ballistic missile submarines of the Arihant tion of these submarines. India has finalized a deal class are expected to be commissioned starting in with Russia, in which at the end of the lease of these 2011. submarines, it has an option to buy them. According to report, the first submarine will be commissioned Planned Acquisitions into the Indian Navy in September, 2009. The first submarine will be named INS Chakra, it is currently The Navy is in negotiations with Russia to acquire undergoing trials in the Pacific ocean. the Kiev class aircraft carrier Admiral Gorshkov(INS Vikrmaditya), however negotiations are stalled due to escalating price demands from Russia. the Indian Navy is also negotiating with Russia for the acquisition of an Negotiations are also under- way for the acquisition of an updated version of Talwar class frigates, and the Scorpène class submarines. India started a program in 1985 to develop indigenous technologies for building a nuclear-powered submarine, known as the Advanced Technology Ves- sel (ATV) project .The first Advanced Technology Vessel is called INS Arihant, was launched on July 26, 2009. The hull for the vessel has been built by Larsen& Toubro at its A naval version of a nuclear reactor has been developed at the Indira Gandhi Centre For Atomic Research , Kalpakkam, and will Copyright © 2009 | WWW.UPSCPORTAL.COM 82

Section -2 (Hot Topics : Economy Special) Economy Special Terminology and Concept Bank Statement: A record, usually sent to the ac- Also known as a "bill" or a "note." Originally, objects count holder once per month, summarizing all trans- such as gold and silver were used to pay for goods actions in an account during the time from the previ- and services. Eventually, they were replaced by pa- ous statement to the current statement. The opening per money and coins that were backed by precious balance from the prior month combined with the net metals. of all transactions during the period should result in the closing balance for the current statement. Currently, banknotes are backed only by the government. Although in earlier times commercial banks Consumers should could issue banknotes, the Federal Reserve Bank is carefully review now the only bank in the United their bank state- States that can create banknotes. ments and retain them for their own Promissory Note: A written, dated records. In recon- and signed two-party instrument ciling their own containing an unconditional prom- record of transac- ise by the maker to pay a definite tio ns with the sum of money to a payee on demand bank's records, ac- or at a specified future date. The count holders only difference between a promis- should be on the sory note and a bill of exchange is lookout for incor- that the maker of a note pays the rect or transposed payee personally, rather than order- numbers as well as ing a third party to do so. unaut ho r iz ed transactions. Discrepancies should be reported as When a bank is the maker promising to repay money soon as possible, in writing if possible. it has received plus interest, the promissory note is called a certificate of deposit (CD). Bankruptcy: A legal proceeding involving a person or business that is unable to repay outstanding debts. Treasury Note: A marketable U.S. government debt The bankruptcy process begins with a petition filed security with a fixed interest rate and a maturity be- by the debtor (most common) or on behalf of credi- tween one and 10 years. Treasury notes can be bought tors (less common). All of the debtor's assets are either directly from the U.S. government or through measured and evaluated, whereupon the assets are a bank. used to repay a portion of outstanding debt. Upon the successful completion of bankruptcy proceed- When buying Treasury notes from the government, ings, the debtor is relieved of the debt obligations you can either put in a competitive or noncompeti- incurred prior to filing for bankruptcy. tive bid. With a competitive bid, you specify the yield you want; however, this does not mean that your bid Banknote: A negotiable promissory note issued by will be approved. With a noncompetitive bid, you a bank and payable to the bearer on demand. The accept whatever yield is determined at auction. Trea- amount payable is stated on the face of the note. sury notes are extremely popular investments as there Banknotes are considered legal tender, and, along is a large secondary market that adds to their liquid- with coins, make up the bearer forms of all modern ity. Interest payments on the notes are made every money. six months until maturity. The income for interest payments is not taxable on a municipal or state level but is federally taxed. Copyright © 2009 | WWW.UPSCPORTAL.COM 83

Section -2 (Hot Topics : Economy Special) system was flawed because countries needed to hold Hard Currency: A currency, usually from a highly large gold reserves in order to keep up with industrialized country, that is widely accepted around the volatile nature of supply and demand for cur- the world as a form of payment for goods and ser- rency. vices. A hard currency is expected to remain rela- After World War II, a modified version of the gold tively stable through a short period of time, and to standard monetary system, the Bretton Woods mon- be highly liquid in the forex market. Another crite- etary system, was created as its successor. This rion for a hard currency is that the currency successor system was initially successful, but because must come from a politically and economically stable it also depended heavily on gold reserves, it was aban- country. The U.S. dollar and the British pound are doned in 1971 when U.S president Nixon "closed good examples of hard currencies. the gold window". Hard Loan: A foreign loan that must be paid in the currency of a nation that has stability and a reputa- Bullion: Gold and silver that is officially recognized tion abroad for economic strength (a hard currency). as high quality (at least 99.5% pure), and is in the For example, a loan agreement between a Brazilian form of bars rather than coins. company and an Argentinean company where the Traditionally, bullion has been a good hedge against debt is to be paid in U.S. dollars. inflation. Hard Money: 1. Funding by a government or orga- Inflation: The rate at which the general level of prices nization that is repetitive, rather than a one-time for goods and services is rising, and, subsequently, grant. Examples include ongoing government daycare purchasing power is falling. Central banks attempt subsidies or firms that pay annual scholarships to to stop severe inflation, along with severe deflation, post-secondary students. in an attempt to keep the excessive growth of prices to a minimum. As inflation rises, every dollar will 2. Describes gold/silver/platinum (bullion) coins. A buy a smaller percentage of a good. For example, if government that uses a hard money policy backs the the inflation rate is 2%, then a $1 pack of gum will value of the currency it uses with a hard, tangible cost $1.02 in a year. and lasting material that will retain its relative value over time. Most countries' central banks will try to sustain an inflation rate of 2-3%. Governments and organizations prefer hard money because it provides a predictable stream of funds. For Consumer Price Index – CPI:A example, in the early 1900s, the U.S. dollar was measure that examines the weighted average of backed by the value of gold. Today, most countries prices of a basket of consumer goods and services, use fiat money, which is made legal tender by gov- such as transportation, food and medical care. The ernment decree but has no intrinsic value of its own. CPI is calculated by taking price changes for each item in the predetermined basket of goods and aver- Gold Standard: A monetary system in which a aging them; the goods are weighted according to their country's government allows its currency unit to importance. Changes in CPI are used to assess be freely converted into fixed amounts of gold and price changes associated with the cost of living. vice versa. The exchange rate under the gold standard monetary system is determined by the economic Sometimes referred to as "headline inflation". difference for an ounce of gold between two The U.S. Bureau of Labor Statistics measures two currencies. The gold standard was mainly used from kinds of CPI statistics: CPI for urban wage earners 1875 to 1914 and also during the interwar years. The and clerical workers (CPI-W), and the chained CPI use of the gold standard would mark the first use of for all urban consumers (C-CPI-U). Of the two types formalized exchange rates in history. However, the Copyright © 2009 | WWW.UPSCPORTAL.COM 84

Section -2 (Hot Topics : Economy Special) of CPI, the C-CPI-U is a better representation of the The decline in prices of assets, is often known as general public, because it accounts for about 87% Asset Deflation. of the population. Declining prices, if they persist, generally create a vicious spiral of negatives such as falling profits, CPI is one of the most frequently used statistics for closing factories, shrinking employment and incomes, identifying periods of inflation or deflation. This and increasing defaults on loans by companies and is because large rises in CPI during a short period of individuals. To counter deflation, the Federal Reserve time typically denote periods of inflation and large (the Fed) can use monetary policy to increase the drops in CPI during a short period of time money supply and deliberately induce rising usually mark periods of deflation. prices, causing inflation. Rising prices provide an essential lubricant for any sustained recovery because Consumer Price Index For All Urban Consumers businesses increase profits and take some of the de- (CPI-U): A measure that examines the changes in pressive pressures off wages and debtors of every the price of a basket of goods and services purchased kind. by urban consumers. The urban consumer population is deemed by many as a better representative Deflationary periods can be both short or long, rela- measure of the general public because most of the tively speaking. Japan, for example, had a period of country's population lives in highly populated areas, deflation lasting decades starting in the early 1990's. which represent close to 90% of the total popula- The Japanese government lowered interest rates to tion. CPI is the most frequently used statistic for try and stimulate inflation, to no avail. Zero interest identifying inflation or deflation. The CPI-U only rate policy was ended in July of 2006. considers the prices paid for goods and services by those that live in urban areas. Rising CPI-U figures Disinflation: A slowing in the rate of price inflation. means that the prices of goods/services within the Disinflation is used to describe instances when the urban population are becoming more expensive inflation rate has reduced marginally over the short and can be a sign of rising inflation. term. Although it is used to describe periods of slowing inflation, disinflation should not be confused with All variants of the CPI are similar to cost of living deflation. Disinflation is commonly used by the Fed- indexes as they assess prices in the market based on eral Reserve to describe situations of slowing infla- the goods and services needed to achieve a given tion. Instances of disinflation are not uncommon and standard of living. Different measures of CPI differ are viewed as normal during healthy economic times. from cost of living indexes because they do not ac- Although sometimes confused with deflation, count for changes in other facets of standard of liv- disinflation is not considered to be as problematic ing, such as changes in environmental factors. because prices do not act ually drop and disinflation does not usually signal the onset of a slowing economy. Deflation: A general decline in prices, often caused by a reduction in the supply of money or Reflation: A fiscal or monetary policy, designed to credit. Deflation can be caused also by a decrease in expand a country's output and curb the effects of government, personal or investment spending. The deflation. Reflation policies can include reducing opposite of inflation, deflation has the side effect of taxes, changing the money supply and lowering in- increased unemployment since there is a lower level terest rates. of demand in the economy, which can lead to an economic depression. Central banks attempt to stop se- The term "reflation" is also used to describe the first vere deflation, along with severe inflation, in an at- phase of economic recovery after a period of con- tempt to keep the excessive drop in prices to a mini- traction. Reflation policy has been used by Ameri- mum. can governments, to try and restart failed business expansions since the early 1600s. Although almost Copyright © 2009 | WWW.UPSCPORTAL.COM 85

Section -2 (Hot Topics : Economy Special) every government tries in some form or another to during the 1970s, when world oil prices rose dra- avoid the collapse of an economy after a recent boom, matically, fueling sharp inflation in developed coun- none have ever succeeded in being able to avoid the tries. For these countries, including the U.S., stag- contraction phase of the business cycle. Many aca- nation increased the inflationary effects. demics actually believe government agitation only Stagnation: A period of little or no growth in the delays the recovery and worsens the effects. economy. Economic growth of less than 2-3% is considered stagnation. Sometimes used to describe Price Inflation: An increase in the price of a stan- low trading volume or inactive trading in securities. dardized good/service or a basket of goods/services A good example of stagnation was the U.S. economy over a specific period of time (usually one year). in the 1970s. Because the nominal amount of money available in an economy tends to grow larger every year relative Acquisition Loan: A loan given to a company to to the supply of goods available for purchase, this purchase a specific asset or to be used for purposes overall demand pull tends to cause some degree of that are laid out before the loan is granted. The ac- price inflation. Price inflation can also be seen in a quisition loan is typically only able to be used for a slightly different form, where the price of a good is short window of time, and only for specific purposes. the same year over year, but the amount of the good received gradually decreases. For example, you Once repaid, funds available through an acquisition may notice this in low-cost snack foods such as po- loan cannot be reborrowed as with a revolving line tato chips and chocolate bars, where the weight of of credit at a bank. Acquisition loans are sought the product gradually decreases, while the price re- when a company wants to complete an acquisition mains the same. for an asset but doesn't have enough liquid capital to do so. The company may be able to get more favor- Reflation:A fiscal or monetary policy, designed to able terms on an acquisition loan because the assets expand a country's output and curb the effects of being purchased have a tangible value, as opposed deflation. Reflation policies can include reducing to capital being used to fund daily operations or re- taxes, changing the money supply and lowering in- lease a new product line. terest rates. Producer Price Index – PPI: A family of indexes The term "reflation" is also used to describe the first that measures the average change in selling prices phase of economic recovery after a period of con- received by domestic producers of goods and ser- traction. Reflation policy has been used by Ameri- vices over time. PPIs measure price change from the can governments, to try and restart failed business perspective of the seller. The PPI looks at three ar- expansions since the early 1600s. Although almost eas of production: industry-based, commodity-based, every government tries in some form or another to and stage-of-processing-based companies. avoid the collapse of an economy after a recent boom, none have ever succeeded in being able to avoid the Hyperinflation: Extremely rapid or out of control contraction phase of the business cycle. Many aca- inflation. There is no precise numerical definition to demics actually believe government agitation only hyperinflation. Hyperinflation is a situation where delays the recovery and worsens the effects. the price increases are so out of control that, the When associated with depressions, hyperinflation Stagflation: A condition of slow economic growth often occurs when there is a large increase in the and relatively high unemployment - a time of stagna- money supply not supported by gross domestic prod- tion - accompanied by a rise in prices, or inflation. uct (GDP) growth, resulting in an imbalance in the Stagflation occurs when the economy isn't growing supply and demand for the money. Left unchecked but prices are, which is not a good situation for a this causes prices to increase, as the currency loses country to be in. This happened to a great extent its value. Copyright © 2009 | WWW.UPSCPORTAL.COM 86

Section -2 (Hot Topics : Economy Special) When associated with wars, hyperinflation often oc- group of the indicators that follow growth in the curs when there is a loss of confidence in a currency's economy. ability to maintain its value in the aftermath. Because of this, sellers demand a risk premium to accept the Although some countries still use the WPIs as a currency, and they do this by raising their prices. measure of inflation, many countries, including the United States, use the producer price index (PPI) One of the most famous examples of hyperinflation instead. occurred in Germany between January 1922 and November 1923. By some estimates, the average Macroeconomics: The field of economics that stud- price level increased by a factor of 20 billion, dou- ies the behavior of t he aggregate economy. bling every 28 hoursoncept of inflation is meaning- Macroeconomics examines economy-wide phenom- less. ena such as changes in unemployment, national income, rate of growth, gross domestic product, infla- Agflation: An increase in the price of food that oc- tion and price levels. Macroeconomics is focused on curs as a result of increased demand from human the movement and trends in the economy as a whole, consumption and use as an alternative energy re- while in microeconomics the focus is placed on fac- source. While the competitive nature of retail super- tors that affect the decisions made by firms and indi- markets allows some of the effects of agflation to be viduals. The factors that are studied by macro and absorbed, the price increases that agflation causes are micro will often influence each other, such as the largely passed on to the end consumer. The term is current level of unemployment in the economy as a derived from a combination of the words "agricul- whole will affect the supply of workers which an oil ture" and "inflation". company can hire from, for example. Interest in alternative energies contributes to Microeconomics: The branch of economics that ana- agflation. In order to produce biofuel (such as lyzes the market behavior of individual consumers biodiesel and ethanol), manufacturers need to use and firms in an attempt to understand the decision- food products such soybeans and corn. This creates making process of firms and households. It is con- more demand for these products, which causes their cerned with the interaction between individual buy- prices to increase. ers and sellers and the factors that influence the choices made by buyers and sellers. In particular, Unfortunately, these price increases spread to other microeconomics focuses on patterns of supply and non-fuel related grains (such as rice and wheat) as demand and the determination of price and output in consumers switch to less expensive substitutes for individual markets (e.g. coffee industry). consumption. Furthermore, agflation will also affect non-vegetative foods (eggs, meat and dairy) as the Green Economics: A methodology of economics price increases for grain will make livestock feed more that supports the harmonious interaction between hu- expensive as well. mans and nature and attempts to meet the needs of both simultaneously. The green economic Retail Price Index – RPI: An index that gathers the theories encompass a wide range of ideas all dealing prices of several retail goods in outlets across the with the interconnected relationship between people United States in order to give an indication of the and the environment. Green economists assert that rate of inflation. This is similar to the CPI and PPI the basis for all economic decisions should be in some reports that are released each month. An index that way tied to the ecosystem. measures and tracks the changes in price of goods in the stages before the retail level. Wholesale price in- Green economists perceive nature as being extremely dexes (WPIs) report monthly to show the average valuable and seek to maintain it. Supporters of this price changes of goods sold in bulk, and they are a branch of economics are concerned with the envi- Copyright © 2009 | WWW.UPSCPORTAL.COM 87

Section -2 (Hot Topics : Economy Special) ronment and believe that actions should be taken to total exports minus total imports. (NX = Exports - protect nature and encourage the positive co-exist- Imports). ence of both humans and nature. Emphasis is placed on creating value through quality rather than on ac- GDP is commonly used as an indicator of the eco- cumulating material items and money.The field of nomic health of a country, as well as to gauge a economics is broken down into two distinct areas of country's standard of living. Critics of using GDP as study: microeconomics and macroeconomics. an economic measure say the statistic does not take Microeconomics looks at the smaller picture and into account the underground economy - transac- focuses more on basic theories of supply and demand tions that, for whatever reason, are not reported to and how individual businesses decide how much of the government. Others say that GDP is not intended something to produce and how much to charge for to gauge material well-being, but serves as a mea- it. People who have any desire to start their own sure of a nation's productivity, which is unrelated. business or who want to learn the rationale behind the pricing of particular products and services would Gross National Product – GNP: An economic be more interested in this area. statistic that includes GDP, plus any income earned by residents from overseas investments, minus in- Macroeconomics, on the other hand, looks at the come earned within the domestic economy by over- big picture (hence "macro"). It focuses on the na- seas residents. GNP is a measure of a country's eco- tional economy as a whole and provides a basic nomic performance, or what its citizens produced knowledge of how things work in the business world. (i.e. goods and services) and whether they produced For example, people who study this branch of eco- these items within its border. nomics would be able to interpret the latest Gross Domestic Product figures or explain why a 6% rate Black Market : A type of economic activity that of unemployment is not necessarily a bad thing. Thus, takes place outside of government-sanctioned chan- for an overall perspective of how the entire economy nels. Black-market transactions typically occur as a works, you need to have an understanding of eco- way for participants to avoid government price con- nomics at both the micro and macro levels. trols or taxes, conducting transactions 'under the table'. The black market is also the means by which Gross Domestic Product – GDP: The monetary value illegal substances or products - such as illicit drugs, of all the finished goods and services produced within firearms or stolen goods - are bought and sold. While a country's borders in a specific time period, though the black market is commonly associated with crimi- GDP is usually calculated on an annual basis. It in- nal activities involving drugs or weapons, it also has cludes all of private and public consumption, gov- a financial component: black currency- ernment outlays, investments and exports less im- exchange markets almost always appear when gov- ports that occur within a defined territory. ernment controls on exchange rates prevent the use of natural exchange rates in the global marketplace. GDP = C + G + I + NX Gross National Product – GNP: An economic where: statistic that includes GDP, plus any income earned "C" is equal to all private consumption, or consumer by residents from overseas investments, minus in- spending, in a nation's economy come earned within the domestic economy by overseas residents. GNP is a measure of a country's eco- "G" is the sum of government spending nomic performance, or what its citizens produced (i.e. goods and services) and whether they produced "I" is the sum of all the country's businesses spend- these items within its borders. ing on capital Real Economic Growth Rate: A measure "NX" is the nation's total net exports, calculated as Copyright © 2009 | WWW.UPSCPORTAL.COM 88

Section -2 (Hot Topics : Economy Special) of economic growth from one period to another ex- applies here. If you have a 10% ROI and inflation pressed as a percentage and adjusted for inflation for the year has been 3%, your real rate of return (i.e. expressed in real as opposed to nominal terms). would be 7%. Similarly, if the nominal GDP figure The real economic growth rate is a measure of the has shot up 8% but inflation has been 4%, the real rate of change that a nation's gross domestic prod- GDP has only increased 4%. uct (GDP) experiences from one year to another. Gross national product (GNP) can also be used if a Nominal Interest Rate: The interest rate unadjusted nation's economy is heavily dependent on foreign for inflation. Not taking into account inflation gives earnings. a less realistic number. The real economic growth rate builds onto the eco- Real Interest Rate: An interest rate that has been nomic growth rate by taking into account the effect adjusted to remove the effects of inflation to reflect that inflation has on the economy. The real economic the real cost of funds to the borrower, and the real growth rate is a "constant dollar" and is therefore a yield to the lender. The real interest rate of an more accurate look at the rate of economic growth investment is calculated as the amount by which the because it is not distorted by the effects of extreme nominal interest rate is higher than the inflation rate. inflation or deflation. Real Interest Rate = Nominal Interest Rate - Infla- tion (Expected or Actual).The real interest rate is Real Gross Domestic the growth rate of purchasing power derived from Product (GDP): This in- an investment. By adjusting the nominal interest rate flation-adjusted measure to compensate for inflation, you are keeping the pur- that reflects the value of chasing power of a given level of capital constant all goods and services over time. produced in a given year, expressed in base-year Blended Rate: 1. An interest rate charged on a loan, prices. Often referred to as which is in between a previous rate and the new rate. "constant-price", "infla- Blended rates are usually offered through the refi- tion-corrected" GDP or nancing of previous loans, and charge a rate that is "constant dollar GDP". higher than the old loan's rate but lower than the rate on a new loan. Unlike nominal GDP, real GDP can account for 2. A rate that is calculated for accounting purposes to changes in the price level, better understand the debt obligation for several loans and provide a with different rates or the revenue from streams of more accurate figure.Let's consider an example. Say interest income. The blended rate is used to calcu- in 2004, nominal GDP is $200 billion. However, due late the pooled cost of funds. to an increase in the level of prices from 2000 (the base year) to 2004, real GDP is actually $170 Banks use a blended rate to retain customers and billion. The lower real GDP reflects the price changes increase loan amounts to proven, creditworthy cli- while nominal does not. ents. For example, if a customer currently holds a 7% interest, $75,000 mortgage and wishes to refinance, Nominal GDP: A gross domestic product (GDP) and the current rate is 9%, the bank might offer a figure that has not been adjusted for inflation. blended rate of 8%. The borrower could then decide to refinance for $145,000 with a blended rate of 8%. Also known as "current dollar GDP" or "chained He or she would still pay 7% on the initial $75,000, dollar GDP". It can be misleading when inflation is but only 8% on the additional $70,000. The blended not accounted for in the GDP figure because the GDP rate is used in cost-of-funds accounting to quantify will appear higher than it actually is. The same con- liabilities or investment income on a balance sheet. cept that applies to return on investment (ROI) Copyright © 2009 | WWW.UPSCPORTAL.COM 89

Section -2 (Hot Topics : Economy Special) For example, if a company had two loans, one for (the idea behind the Phillips Curve). However, crit- $1,000 at 5% and the other for $3,000 at 6% and ics of this say that the effect is temporary and that paid the interest off every month, the $1,000 loan unemployment would bounce back up but inflation would charge $50 after one year and the $3,000 loan would stay high. Thus, the natural, or equilibrium, would charge $180. The blended rate would there- rate is the lowest level of unemployment at which fore be (50+180)/4000 or 5.75%. inflation remains stable. Also known as the "non- accelerating inflation rate of unemployment" Refinance: 1. When a business or person revises a (NAIRU). payment schedule for repaying debt. When the economy is said to be at full employment, 2. Replacing an older loan with a new loan offering it is at its natural rate of unemployment. Economists better terms. debate how the natural rate might change. For example, some economists think that increasing labor- When a business refinances, it typically extends the market flexibility will reduce the natural rate. Other maturity date. When individuals change their monthly economists dispute the existence of a natural rate payments or modify the rate of interest on their loans, altogether! it usually involves a penalty fee. Okun's Law :A relationship between an economy's GDP gap and the actual unemployment rate. GDP Gap: The forfeited output of a country's The relationship is represented by a ratio of 1 to 2.5. economy resulting from the failure to create suffi- Thus, for every 1% excess of the natural unemploy- cient jobs for all those willing to work. A GDP gap ment rate, a 2.5% GDP gap is predicted. denotes the amount of production that is irretriev- ably lost. The potential for higher production levels Phillips Curve :An economic concept developed by is wasted because there aren't enough jobs supplied. A. W. Phillips stating that inflation and unemployment have a stable and inverse relationship. Accord- Frictional Unemployment :Unemployment that is ing to the Phillips curve, the lower an economy's rate always present in the economy, resulting from tem- of unemployment, the more rapidly wages paid to porary transitions made by workers and employers labor increase in that economy. The theory states that or from workers and employers having inconsistent with economic growth comes inflation, which in turn or incomplete information. For example, a first-time should lead to more jobs and less unemployment. job seeker may lack the resources or efficiency for However, the original concept has been somewhat finding the company that has the job that is available disproven empirically due to the occurrence of and suitable for him or her. As a result this person stagflation in the 1970s, when there were high levels does not take other work, temporarily holding out of both inflation and unemployment. for the better-paying job. Structural Unemployment :Unemployment result- Another example of when frictional employment ing from changes in the basic composition of the occurs is when a company abstains from hiring be- economy. These changes simultaneously open new cause it believes there are not enough qualified indi- positions for trained workers. An example of struc- viduals available for the job, when in actuality there tural unemployment is the technological revolution. is. Computers may have eliminated jobs, but they also opened up new positions for those who have the skills Natural Unemployment :The lowest rate of unem- to operate the computers. ployment that an economy can sustain over the long run. Keynesians believe that a government can lower Cyclical Unemployment :A factor of overall un- the rate of unemployment (i.e. employ more people) employment that relates to the cyclical trends in if it were willing to accept a higher level of inflation growth and production that occur within the busi- Copyright © 2009 | WWW.UPSCPORTAL.COM 90

Section -2 (Hot Topics : Economy Special) ness cycle. When business cycles are at their peak, age crossover, because it occurs after a certain price cyclical unemployment will be low because total eco- move has already happened. Technical traders use a nomic output is being maximized. When economic short-term average crossing above a long-term av- output falls, as measured by the gross domestic prod- erage as confirmation when placing buy orders since uct (GDP), the business cycle is low and cyclical it suggests an increase in momentum. The drawback unemployment will rise. of using this method is that a significant move may have already occurred, resulting in the trader enter- Economists describe cyclical unemployment as the ing a position too late. result of businesses not having enough demand for labor to employ all those who are looking for work. Leading Indicator :A measurable economic factor The lack of employer demand comes from a lack of that changes before the economy starts to follow a spending and consumpt ion in t he overall particular pattern or trend. Leading indicators are economy. Cyclical unemployment is one of five used to predict changes in the economy, but are not classes of unemployment as recognized by econo- always accurate. Bond yields are typically a good mists. Other types include structural, frictional, clas- leading indicator of the market because traders an- sical and Marxian. In most cases, several types of ticipate and speculate trends in the economy. unemployment exist at the same time. With the ex- Business Cycle :The recurring and fluctuating lev- ception of cyclical unemployment, the other classes els of economic activity that an economy experiences can be occurring even at the peak ranges of business over a long period of time. The five stages of the cycles, when the economy is said to be at or near business cycle are growth (expansion), peak, reces- “full employment”. sion (contraction), trough and recovery. At one time, business cycles were thought to be extremely regu- Coincident Indicator :An economic factor that var- lar, with predictable durations, but today they are ies directly and simultaneously with the business widely believed to be irregular, varying in frequency, cycle, thus indicating the current state of the magnitude and duration. economy. Some examples include nonagricultural employment, personal income and industrial produc- Since the World War II, most business cycles have tion. lasted three to five years from peak to peak. The average duration of an expansion is 44.8 months and Lagging Indicator :1. A measurable economic fac- the average duration of a recession is 11 months. As tor that changes after the economy has already be- a comparison, the Great Depression - which saw a gun to follow a particular pattern or trend. decline in economic activity from 1929 to 1933 - lasted 43 months. 2. A technical indicator that trails the price action of an underlying asset and is used by traders to gener- Hard Landing :A term used to describe an economy ate transaction signals or to confirm the strength of going into recession as the government attempts to a given trend. Since these indicators lag the price of slow down inflation. The Fed will try to avoid a hard the asset, a significant move will generally occur be- landing by raising interest rates only enough to slow fore the indicator is able to provide a signal. the economy down without putting it into recession (a soft landing). Lagging indicators confirm long-term trends, but they do not predict them. Some examples are unemploy- Overheated Economy :When a prolonged period ment, corporate profits and labor cost per unit of of good economic growth and activity causes high output. Interest rates are another good lagging indi- levels of inflation (from increased consumer wealth) cator; rates change after severe market changes. and inefficient supply allocations as producers over- produce and create excess production capacity in an An example of a lagging indicator is a moving aver- attempt to capitalize on the high levels of wealth. Copyright © 2009 | WWW.UPSCPORTAL.COM 91

Section -2 (Hot Topics : Economy Special) Unfortunately, these inefficiencies and inflation will mists. Other types include structural, frictional, clas- eventually hinder the economy's growth and cause a sical and Marxian. In most cases, several types of recession. Rising rates of inflation are typically one unemployment exist at the same time. With the ex- of the first signs that an economy is overheating. As ception of cyclical unemployment, the other classes a result, governments and central banks will usually can be occurring even at the peak ranges of business raise interest rates in an attempt to lower the amount cycles, when the economy is said to be at or near of spending and borrowing. “full employment”. Between June 2004 and June 2006, the Federal Re- Pale Recession : A phrase used in May 2008 by serve Board increased the interest rate 17 times as a former Federal Reserve Board Chairman Alan gradual means of slowing America's overheated Greenspan to describe an economic environment in economy. which recession has not yet hit all the areas of the economy. In particular, Greenspan was speaking of Full Employment :A situation in which the U.S. employment numbers at the time, which had all available labor resources are being used in the not yet seen as significant of a decline as would be most economically efficient way. Full employment expected in a full recessionary environment, which embodies the highest amount of skilled and unskilled is generally marked by a broad decline in economic labor that could be employed within an economy at activity across the economy. any given time. The remaining unemployment is frictional. Frictional unemployment is the amount of Greenspan used this term in a television interview unemployment that results from workers who are in with Bloomberg on May 4, 2008. When asked between jobs, but are still in the labor force. Full whether the U.S. was in a recession he responded, employment is attainable within any economy, but "We're in a recession ... but this is an awfully pale may result in an inflationary period. The inflation recession at the moment. The declines in employ- would result from workers, as a whole, having more ment have not been as big as you'd expect to see." disposable income, which would drive prices upward. Fiscal Policy :Government spending policies that Many economists have estimated the amount of fric- influence macroeconomic conditions. These policies tional unemployment, with the number ranging from affect tax rates, interest rates and government spend- 2-7% of the labor force. ing, in an effort to control the economy. Since the 1980s, most western countries have held a "tight" Cyclical Unemployment : A factor of overall un- policy, limiting public expenditure. employment that relates to the cyclical trends in growth and production that occur within the busi- Money Supply :The entire quantity of bills, coins, ness cycle. When business cycles are at their peak, loans, credit and other liquid instruments in a cyclical unemployment will be low because total eco- country's economy. Money supply is divided into nomic output is being maximized. When economic multiple categories - M0, M1, M2 and M3 - accord- output falls, as measured by the gross domestic prod- ing to the type and size of account in which the in- uct (GDP), the business cycle is low and cyclical strument is kept. The money supply is important to unemployment will rise. economists trying to understand how policies will affect interest rates and growth. Economists describe cyclical unemployment as the result of businesses not having enough demand for Discount Rate : 1. The interest rate that an eligible labor to employ all those who are looking for work. depository institution is charged to borrow short- The lack of employer demand comes from a lack of term funds directly from a Federal Reserve Bank. spending and consumpt ion in t he overall economy. Cyclical unemployment is one of five 2. The interest rate used in determining the present classes of unemployment as recognized by econo- Copyright © 2009 | WWW.UPSCPORTAL.COM 92

Section -2 (Hot Topics : Economy Special) value of future cash flows. constantly in a state of flux as the bears and their optimistic counterparts, "bulls", are trying to take This type o f bo rrowing from the Fed is control, do remember that over the last 100 years or fairly limited. Institutions will often seek other means so the U.S. stock market has increased an average of meeting short-term liquidity needs. 11% a year. This means that every single long-term market bear has lost money. Prime Rate : The interest rate that commercial banks charge their mo st credit-worthy customers. Bull Market : A financial market of a group of se- Generally a bank's best customers consist of large curities in which prices are rising or are expected to corporations. Default risk is the main determiner of rise. The term "bull market" is most often used to the interest rate a bank will charge a borrower. Be- refer to the stock market, but can be applied to any- cause a bank's best customers have little chance of thing that is traded, such as bonds, currencies and defaulting, the bank can charge them a rate that is commodities. lower than the rate that would be charged to a customer who has a higher likelihood of defaulting on a Bull markets are characterized by optimism, inves- loan. tor confidence and expectations that strong results will continue. It's difficult to predict consistently when the trends in the market will change. Part of Bull :An investor who thinks the market, a specific the difficulty is that psychological effects and specu- security or an industry will rise. lation may sometimes play a large role in the markets. Bulls are optimistic investors who are presently pre- dicting good things for the market, and are attempt- The use of "bull" and "bear" t o describe ing to profit from this upward movement. For ex- markets comes from the way the animals attack their ample if you are bullish on the S&P 500 you will at- opponents. A bull thrusts its horns up into the air tempt to profit from a rise in the index by going long while a bear swipes its paws down. These actions are on it. Bulls are the exact opposite of the market's metaphors for the movement of a market. If the bears, who are pessimistic and believe that a particu- trend is up, it's a bull market. If the trend is down, lar security, commodity or entity will suffer a decline it's a bear market. in price. Bear Market: A market condition in which the prices Bullishness does not necessarily apply only to the of securities are falling, and widespread pessimism stock market; you could for example be bullish on causes the negative sentiment to be self-sustaining. just about anything, including commodities like soy As investors anticipate losses in a bear market and beans, crude oil or even peanuts. selling continues, pessimism only grows. Although figures can vary, for many, a downturn of 20% or Bear : An investor who believes that a particular more in multiple broad market indexes, such as the security or market is headed downward. Bears at- Dow Jones Industrial Average (DJIA) or Standard tempt to profit from a decline in prices. Bears are & Poor's 500 Index (S&P 500), over at least a two- generally pessimistic about the state of a given mar- month period, is considered an entry into a bear ket. For example, if an investor were bearish on the market. S&P 500 they would attempt to profit from a decline in the broad market index. Bearish sentiment A bear market should not be confused with a correc- can be applied to all types of markets including com- tion, which is a short -term trend that has a modity markets, stock markets and the bond mar- duration of less than two months. While corrections ket. are often a great place for a value investor to find an entry point, bear markets rarely provide great entry Although you often hear that the stock market is Copyright © 2009 | WWW.UPSCPORTAL.COM 93

Section -2 (Hot Topics : Economy Special) points, as timing the bottom is very difficult to do. value. Zero-investment portfolios can be achieved by Fighting back can be extremely dangerous because simultaneously purchasing securities and selling it is quite difficult for an investor to make stellar gains equivalent securities. This will achieve lower risk/ during a bear market unless he or she is a short seller. gains compared to only purchasing or selling the same securities. Recession: A significant decline in activity across the economy, lasting longer than a few months. It is Arbitrage: The simultaneous purchase and sale of visible in industrial production, employment, real in- an asset in order to profit from a difference in the come and wholesale-retail trade. The technical indi- price. It is a trade that profits by exploiting price cator of a recession is two consecutive quarters of differences of identical or similar financial instru- negative economic growth as measured by a country's ments, on different markets or in different forms. gross domestic product (GDP); although the National Arbitrage exists as a result of market inefficiencies; Bureau of Economic Research (NBER) does not it provides a mechanism to ensure prices do not de- necessarily need to see this occur to call a recession. viate substantially from fair value for long periods of Recession is a normal (albeit unpleasant) part of the time. business cycle; however, one-time crisis events can often trigger the onset of a recession. Asset Allocation: An investment strategy that aims to balance risk and reward by apportioning a A recession generally lasts from six to 18 months, portfolio's assets according to an individual's goals, and interest rates usually fall in during these months risk tolerance and investment horizon. to stimulate the economy by offering cheap rates at The three main asset classes - equities, fixed-income, which to borrow money. and cash and equivalents - have different levels of risk and return, so each will behave differently over time. Boom: A period of time during which sales or business activity increases rapidly. Portfolio: A grouping of financial assets such as stocks, bonds and cash equivalents, as well as their In the stock market, booms are associated with bull mutual, exchange-traded and closed-fund counter- markets. Conversely, busts are associated with bear parts. Portfolios are held directly by investors and/ markets. The cyclical nature of the market and the or managed by financial professional economy in general suggests that every bull market in history has been followed by a bear market. Security: An instrument representing ownership (stocks), a debt agreement (bonds) or the rights to The internet technologies boom in the late '90s was ownership (derivatives). one of the largest booms in history (followed by one of the biggest busts in history). Corporation: A legal entity that is separate and distinct from its owners. Corporations enjoy most of Public-Private Investment Program – PPIP: A the rights and responsibilities that an individual pos- plan designed to value and remove troubled assets sesses; that is, a corporation has the right to enter from the balance sheet of troubled financial institu- into contracts, loan and borrow money, sue and be tions in the U.S. Essentially, the Public-Private In- sued, hire employees, own assets and pay taxes. vestment Program's goal is to create partnerships with private investors to buy toxic assets. The The most important aspect of a corporation is lim- program is designed to increase liquidity in the mar- ited liability. That is, shareholders have the right to ket and to serve as a price-discovery tool for valuing participate in the profits, through dividends and/or troubled assets. the appreciation of stock, but are not held personally liable for the company's debts. Zero-Investment Portfolio: A group of investments which, when combined, create a zero net Corporations are often called "C Corporations". Copyright © 2009 | WWW.UPSCPORTAL.COM 94

Section -2 (Hot Topics : Economy Special) Fortune 500: An annual list of the 500 largest com- in hedge funds are illiquid as they often require in- panies in the United States. The list is compiled us- vestors keep their money in the fund for at least one ing the most recent figures for revenue. year. Index: A statistical measure of change in an economy Short Selling: The selling of a security that the seller or a securities market. In the case of financial mar- does not own, or any sale that is completed by the kets, an index is an imaginary portfolio of securities delivery of a security borrowed by the seller. Short representing a particular market or a portion of it. sellers assume that they will be able to buy the stock Each index has its own calculation methodology and at a lower amount than the price at which they sold is usually expressed in terms of a change from a base short. value. Thus, the percentage change is more important than the actual numeric value. Buyback: The repurchase of outstanding shares (repurchase) by a company in order to reduce the num- Stock and bond market indexes are used to construct ber of shares on the market. Companies will buy back index mutual funds and exchange-traded funds shares either to increase the value of shares still avail- (ETFs) whose portfolios mirror the components of able (reducing supply), or to eliminate any threats the index. by shareholders who may be looking for a control- ling stake. Market Capitalization: The total dollar market Short Covering: Purchasing securities in order to value of all o f a company's outst anding close an open short position. This is done by buying shares. Market capitalization is calculated by multi- the same type and number of securities that were plying a company's shares outstanding by the current sold short. Most often, traders cover their shorts market price of one share. The investment whenever they speculate that the securities will community uses this figure to determining a rise. In order to make a profit, a short seller must company's size, as opposed to sales or total asset cover the shorts by purchasing the security below figures. the original selling price. Frequently referred to as "market cap". Also referred to as "buy to cover" or "buyback". Hedge: Making an investment to reduce the risk of Nasdaq: A computerized system that facilitates trad- adverse price movements in an asset. Normally, a ing and provides price quotations on more than 5,000 hedge consists of taking an offsetting position in a of the more actively traded over the counter stocks. related security, such as a futures contract. Created in 1971, the Nasdaq was the world's first electronic stock market. Hedge Fund :An aggressively managed portfolio of investments that uses advanced investment strategies Stocks on the Nasdaq are traditionally listed under such as leveraged, long, short and four or five letter ticker symbols. If the company is derivative positions in both domestic and interna- a transfer from the New York Stock Exchange, the tional markets with the goal of generating high re- symbol may be comprised of three letters. turns (either in an absolute sense or over a specified market benchmark). Over-The-Counter – OTC: A security traded in some context other than on a formal exchange Legally, hedge funds are most often set up as private such as the NYSE, TSX, AMEX, etc. The phrase investment partnerships that are open to a limited "over-the-counter" can be used to refer to number of investors and require a very stocks that trade via a dealer network as opposed large initial minimum investment. Investments to on a centralized exchange. It also refers to debt securities and other financial instruments such as Copyright © 2009 | WWW.UPSCPORTAL.COM 95

Section -2 (Hot Topics : Economy Special) derivatives, which are traded through a dealer among others. network. Also referred to as an "echeck". Derivative: A security whose price is dependent upon or derived from one or more underlying Wire Transfer: An electronic transfer of funds across assets. The derivative itself is merely a contract be- a network administered by hundreds of banks around tween two or more parties. Its value is determined by the world. Wire transfers allow people in different fluctuations in the underlying asset. The most com- geographic locations to easily transfer money. Out- mon underlying assets include stocks, side of North America, wire transfers are sometimes bonds, commodities, currencies, interest rates and referred to as a 'telegraphic transfer' or t/t. market indexes. Most derivatives are characterized by high leverage. Clearing: The procedure by which an organization acts as an intermediary and assumes the role of a Penny Stock: A stock that trades at a relatively low buyer and seller for transactions in order to recon- price and market capitalization, usually outside of cile orders between transacting parties. the major market exchanges. These types of stocks are generally considered to be highly speculative and Clearing is necessary for the matching of all buy and high risk because of their lack of liquidity, large bid- sell orders in the market. It provides smoother and ask spreads, small capitalization and limited follow- more efficient markets, as parties can make transfers ing and disclosure. They will often trade over the to the clearing corporation, rather than to each indi- counter through the OTCBB and pink sheets. vidual party with whom they have transacted. Automated Clearing House - ACH :An electronic Clearing House: An agency or separate corpora- funds-transfer system run by the National Automated tion of a futures exchange responsible for settling Clearing House Association. This payment system trading accounts, clearing trades, collecting and main- deals with payroll, direct deposit, tax refunds, containing margin monies, regulating delivery and re- sumer bills, tax payment, and many more payment porting trading data. Clearing houses act as third services. parties to all futures and options contracts - as a buyer to every clearing member seller and a seller to every Commercial Bank: A financial institution that pro- clearing member buyer. vides services such as a accepting deposits and giving business loans. Cash Market: The market for a cash commodity or actual, as opposed to the market for its futures con- Commercial banking activities are different than those tract. A cash market may take the following forms: of investment banking, which include underwriting, self-regulated centralized markets, such as commod- acting as an intermediary between an issuer of secu- ity exchanges; decentralized over-the-counter mar- rities and the investing public, facilitating mergers kets where private transactions may occur; or local- and other corporate reorganizations, and also acting ized community organizations, such as grain eleva- as a broker for institutional clients. tors. At these locations, you can purchase the actual physical commodity rather than just the futures con- Electronic Check: A form of payment made via the tract. internet that is designed to perform the same function as a conventional paper check. Because the Buyer's Market: A market condition characterized check is in an electronic format, it can be processed by an abundance of goods available for sale. When a in fewer steps and has more security features than a buyer's market exists in commodities, the buyer is standard paper check. Security features provided able to be selective in purchasing contracts, as there by electronic checks include authentication, public are many individuals wishing to sell. Furthermore, key cryptography, digital signatures and encryption, these buyers will generally be able to purchase con- Copyright © 2009 | WWW.UPSCPORTAL.COM 96

Section -2 (Hot Topics : Economy Special) tracts at lower prices than those that were previously ucts such as foreign currencies and indexes. prevalent. Technological advances have also led to new types Forward Contract :A cash market transaction in of commodities being exchanged in the market- which delivery of the commodity is deferred until place: for example, cell phone minutes and band- after the contract has been made. Although the de- width. livery is made in the future, the price is determined on The sale and purchase of commodities is usually car- the initial trade date. Most forward contracts don't ried out through futures contracts on exchanges that have standards and aren't traded on exchanges. A standardize the quantity and minimum quality of the farmer would use a forward contract to "lock-in" a commodity being traded. For example, the Chicago price for his grain for the upcoming fall harvest. Board of Trade stipulates that one wheat contract is for 5,000 bushels and also states what grades of wheat Hybrid Security: A security that combines two or (e.g. No. 2 Northern Spring) can be used to satisfy more different financial instruments. Hybrid securi- the contract. ties generally combine both debt and equity charac- teristics. The most common example is a convertible Diversification: A risk management technique that bond that has features of an ordinary bond, but is mixes a wide variety of investments within a portfo- heavily influenced by the price movements of the lio. The rationale behind this technique contends that stock into which it is convertible. a portfolio of different kinds of investments will, on Often referred to as "hybrids".New types of hybrid average, yield higher returns and pose a lower risk securities are being introduced all the time to meet than any individual investment found within the port- the needs of sophisticated investors. Some of these folio. securities get so complicated that it's tough to define them as either debt or equity. Diversification strives to smooth out unsystematic risk events in a portfolio so t hat the Commodity: 1. A basic good used in commerce that positive performance of some investments is interchangeable with other commodities of the will neutralize the negative performance of others. same type. Commodities are most often used as in- Therefore, the benefits of diversification will hold puts in the production of other goods or services. only if the securities in the portfolio are not perfectly The quality of a given commodity may differ slightly, correlated. but it is essentially uniform across producers. When they are traded on an exchange, commodities must Active Bond :A term used to describe fixed-income also meet specified minimum standards, also known securities that trade frequently on the floor of the as a basis grade. NYSE.These are typically corporate debt instruments and convertible bonds issued by well established com- 2. Any good exchanged during commerce, which panies on the NYSE. includes goods traded on a commodity exchange. Maturity: 1. The length of time until the principal The basic idea is that there is little differentiation amount of a bond must be repaid. between a commodity coming from one producer and the same commodity from another producer - a bar- 2. The end of the life of a security. rel of oil is basically the same product, regardless of In other words, the maturity is the date the borrower the producer. Compare this to, say, electronics, where must pay back the money he or she borrowed through the quality and features of a given product will be the issue of a bond. completely different depending on the producer. Some traditional examples of commodities include Government Security: A government debt obliga- grains, gold, beef, oil and natural gas. More recently, tion (local or national) backed by the credit and tax- the definition has expanded to include financial prod- Copyright © 2009 | WWW.UPSCPORTAL.COM 97

Section -2 (Hot Topics : Economy Special) ing power of a country with very little risk of default. This includes short-term Treasury bills, medium-term Treasury notes, and long-term Treasury bonds. Sovereign Bond: A debt security issued by a national government within a given country and denominated in a foreign currency. The foreign currency used will most likely be a hard currency, and may represent significantly more risk to the bondholder. ADVERTISEMENT NEW BOOK Arrivals Geography : A Comprehensive Study for Pre and Main Exams by Mahesh Kumar Barnwal About The Author : The author is successful candidate of civil services 1997 batch and has the experience of teaching geography at Cosmos IAS Academy Delhi for the last 11 years. Book Description : The present book 'Geography : A Comprehensive Study' is the english edition of his very popular book in Hindi 'Bhugol : A Samagra Addhyan' among the civil services aspirants. The book is emprenated with all relevant concepts and information needed for the general studies as well as Geography optional. Author : Mahesh Kumar Barnwal Medium : English Publisher: Cosmos Publication No. of Pages : 388 ISBN : 819081741 - 8 Price: 225.00 Rs. BUY ONLINE: http://upscportal.com/store/Book/Cosmos-Publication/Geography/Geography-A-Comprehensive-Study-for-Pre-and-main-Exams-of-Union-and-State-PSC Advertise your Business Here Contact Us Online: http://upscportal.com/store/contact Copyright © 2009 | WWW.UPSCPORTAL.COM 98

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Section -3 (Current Relevant Facts) Current Affairs » Farah Pandith has appointed to head the new Of- » Gangubai was the recipient of several prestigious fice of the United States Special Representative to awards like the Karnataka Sangeet Nritya Academy Muslim Communities. Special Representative Farah Award, in the year 1962, the Padma Bhushan in 1971, Pandith and her staff (S/SRMC) will be responsible Padma Vibhushan in 2002 and the Sangeet Natak for executing t he Akademi Award in the year Administration’s efforts to en- 1973. gage with Muslims around the world on a people-to-people » The journalist-turned-politi- and organizational cian Jadranka Kosor became level.Pandith was the senior Croatia's first woman prime adviser on Muslim engagement minister on July 6, 2009 vow- in the European and Eurasian ing to revive the country's bid region at the State Department. to join the European Union and The position was created for tackle the economic crisis.Her the first time in the US history. centre-right cabinet were ap- Prior to the State Department, proved by 83 deputies in a vote she served on the National Se- in the 153-member parliament. curity Council at the White Forty-five voted against, no House where she worked on one abstained while the remain- Muslim engagement and coming were not present.She suc- bating extremism. She worked ceeded Ivo Sanader who, after at the U.S. Agency for Inter- holding Croatia's most power- national Development in the ful political position for the past early 1990s and again in 2003. She also served in six years, shocked the nation by resigning in June Kabul, Afghanistan in 2004. last pushing the country into political turmoil. The 56-year-old Jadranka Kosor took up the mantle amid Pandith, a Muslim, immigrated to the United States deep economic woes that have the country facing its with her parents from Srinagar, India. She grew up worst crisis since its war of independence from the in Massachusetts with a diversity of faiths, ethnicities former communist Yugoslavia in the early 1990s.Her and perspectives. appointment is seen as controversial, but she pledged to tackle Croatia's economic struggles and its stalled » Renowned Hindustani classical vocalist Gangubai bid to become the European Union's 28th member Hangal died at the Lifeline Emergency Care Centre by 2011. in Hubli, Karnataka on July 21, 2009. She was 97- year-old. She was born in 1913 at Dharwad to » Mauritania's former military ruler Gen. Mohamed Chikkurao Nadiger, an agriculturist and Ambabai, a Ould Abdel Aziz took oath of office as the nation's celebrated vocalist of Carnatic music. Her family new civilian president on August 6, 2009. His politi- shifted to Hubli in 1928. Initially, she learned classical opponents are still challenging the outcome of cal music from Krishnacharya and Dattopant Desai last month's election. Earlier he was declared the vic- before studying under Sawai Gandharva. She started tor in the presidential election with more than 50 performing in local celebrations and Ganeshotsavas percent of the vote following a well-organized cam- in Mumbai as a teenager. She is probably the last of paign that portrayed him as the "President of the the titans to be representing the purity of Hindustani Poor" on July 19, 2009. Former general Mohamed classical music. Copyright © 2009 | WWW.UPSCPORTAL.COM 100

Section -3 (Current Relevant Facts) Ould Abdel Aziz was sworn in as president a year ing from cancer. Bhaskar Chandavarkar blended In- after taking power in a military coup that toppled dian classical and Western music in his work. He was the nation's first freely-elected leader. a disciple of Pandit Ravi Shankar. He composed the musical scores for about 40 films in Hindi, Marathi, » He encouraged greater cooperation between and Malayalam. He won acclaim for the innovative Mauritania and Mali in the fight against terrorism. music he composed for the landmark Marathi play Al-Qaeda's North Africa affiliate has been active in Ghashiram Kotwal, written by Vijay Tendulkar and the area, attacking government troops and kidnap- directed by Jabbar Patel in the early 1970s. He also ping foreign tourists. While Mauritania's leading taught music at the Film and Television Institute of political opponents say they will not cooperate with India (FTII) for 15 years. A recipient of the Sangeet the new Aziz government, members of the Interna- Natak Akademi Award in 1988, Chandavarkar also tional Crisis Group are hoping there will eventually scored the music in many offbeat films like Amol be some reconciliation. African Union Ambassador Palekar’s Aakrit and Jabbar Patel’s Saamna and to Belgium Mohamed Sale Nadif was part of the In- Sinhasan. His other films include Thodasa Rumaani ternational Crisis Group that negotiated the transi- Ho Jaye, Kairi, Raosaheb, and Mati Mai. tional government that led to last month's vote. » Music director and sitarist Bhaskar Chandavarkar » Syed Abdullah Bukhari, the grand old Shahi Imam died at age of 73 early this morning. He was suffer- of Delhi's historic Jama Masjid and for long one of ing from cancer. Bhaskar Chandavarkar blended In- India's most outspoken Muslim leaders, died in New dian classical and Western music in his work. He was Delhi on July 8, 2009 after a long illness. He was 87. a disciple of Pandit Ravi Shankar. He composed the The elderly Bukhari, who anointed his son Syed musical scores for about 40 films in Hindi, Marathi, Ahmed Bukhari as the Shahi Imam in 2000 but con- and Malayalam. He won acclaim for the innovative tinued to retain the title was named the Naib Shahi music he composed for the landmark Marathi play Imam in 1946, a year before India's independence. Ghashiram Kotwal, written by Vijay Tendulkar and Belonging to a family originally hailing from Central directed by Jabbar Patel in the early 1970s. He also Asia, the Bukharis were invited to Delhi by Mughal taught music at the Film and Television Institute of emperors to preside over the Jama Masjid. Abdullah India (FTII) for 15 years. A recipient of the Sangeet Bukhari, born in Rajasthan and educated in Delhi, Natak Akademi Award in 1988, Chandavarkar also was the 12th Shahi Imam. Bukhari took keen inter- scored the music in many offbeat films like Amol est in the social and economic issues linked to Palekar’s Aakrit and Jabbar Patel’s Saamna and Muslims.He took to the streets following communal Sinhasan. His other films include Thodasa Rumaani violence in Delhi's Kishanganj area in 1974, leading Ho Jaye, Kairi, Raosaheb, and Mati Mai. to his jailing for 18 days in early 1975. The event triggered widespread protests. He rose to national » Formerly the Rajmata of Jaipur and one of the last prominence in March 1977 when he joined national of India's surviving royalty, Maharani Gayatri Devi politicians in mobilising people to vote out the Con- died Wednesday, July 29, after a ten-day illness. She gress government of Indira Gandhi, accusing it of was 90 years old. Born in 1919 into the royal family displacing the poor from their homes and forcing their of Cooch Behar, in 1939 Devi married Maharaja menfolk to undergo vasectomy. The senior Bukhari Sawai Man Singh II of Jaipur, becoming his third also played an active role in support of the Babri wife. She ran for parliament in 1962 as a member of Masjid in Ayodhya but his appeal started to wane the Swatantra Party, winning her constituency with after mobs destroyed the mosque in 1992, creating a then-record 78% of the vote. Gayatri Devi won the worst Hindu-Muslim fissures since 1947. reelection twice, but she ran afoul of tax laws after the abolition of privy purses in 1971 and was jailed » Music director and sitarist Bhaskar Chandavarkar for five months. After her release from prison, she died at age of 73 early this morning. He was suffer- withdrew from politics and published an autobiog- Copyright © 2009 | WWW.UPSCPORTAL.COM 101

Section -3 (Current Relevant Facts) raphy, A Princess Remembers, in 1976; the 1997 film its version of Google Earth on august 12,2009. Mémoires d'une princesse des Indes (Memoirs of a Minister of State in the PMO Prithviraj Chavan Hindu Princess) was based around her life. launched the beta version of the geoportal www.bhuvan.nrsc.gov.in at a day-long workshop of » Famous painter Tyeb Mehta died in his house at the Astronautical Society of India on "21st Century Mumbai on july 2,2009. He was 84. He is survived Challenges in Space -- Indian Context."The new web- by wife and two children. based tool allows users to have a closer look at any part of the subcontinent barring sensitive locations » Mr. Mehta who was born in 1925 in Gujarat, started such as military and nuclear installations. his career in the film industry. In 1952, he obtained a diploma from the JJ College of Arts. He hit the head- » The degree of resolution showcased is based on lines in t he art world when his painting points of interest and popularity, but most of the In- ‘Celebration’ was sold for a whopping Rs. dian terrain is covered upto at least six meters of 1.5 crores. In 2005, his picture ‘Kali’ was sold for resolution with the least spatial resolution being 55 Rs. 1 crore. In 2007, his picture ‘Christine' was sold meters. in an auction for 2 billion dollars.In 2007, Indian government honoured him with Padmasri. » Bhuvan uses images taken at least a year ago by ISRO's seven remote sensing satellites, including » Hawaii was chosen as the site for the world's big- Cartosat-1 and Cartosat-2. These eyes in the sky can gest telescope, a device so powerful that it will al- capture images of objects as small as a car on the low scientists to see some 13 billion light years away road to build three-dimensional map of the world. and get a glimpse into the early years of the universe on july 20,2009. » The pictures are expected to be sharper than those on Google Earth as Bhuvan uses 10 meter resolu- » The telescope's mirror stretching almost 100 feet tion images as against 200 meter resolution photos in diameter, or nearly the length of a Boeing 737's offered by others.Unlike in Google Earth, users will wingspan, will be so large that it should be able to not be able to download images from Bhuvan and gather light that will have spent 13 billion years trav- will be able to browse content like on any website. eling to earth. This means astronomers looking into the telescope will be able to see images of the first stars and galaxies forming - some 400 million years after the Big Bang. (IMP) Get UPSCPORTAL , Jobs, Re- sults, Notification Alerts on Email. » The telescope, expected to be completed by 2018, Step-1: Fill Your Email address in form be- will be located atop a dormant volcano that is popu- low. you will get a confirmation email within lar with astronomers because its summit sits well 10 min. above the clouds at 13,796 feet, offering a clear view of the sky above for 300 days a year.Hawaii's iso- Step-2: Varify your email by clicking on the lated position in the middle of the Pacific Ocean also link in the email. (check Inbox and Spam fold- means the area is relatively free of air pollution. Few ers) cities on the Big Island mean there aren't a lot of man-made lights around to disrupt observations.The Step-3: Done! Now you will regular Alerts other finalist candidate site for the Thirty Meter Tele- on your email. scope was Chile's Cerro Armazones mountain. The common man can now view sharper pictures of any part of the world on their personal computer using satellite images with ISRO unveiling 'Bhuvan', Copyright © 2009 | WWW.UPSCPORTAL.COM 102

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Section -4 (SPORTS) SPORTS Asian Carrom Championship: India retained the Women's Singles: In the fourth all-Williams final at men and women team titles in the third Asian Carrom Wimbledon, Serena beat her sister Venus 7-6 (3), 6- Championship in Pune on August 12, 2009.Defend- 2 on July 4, 2009 and won her third title and 11th ing champion India blanked Sri Lanka by identical Grand Slam championship. Serena beat Venus in the 3-0 margin in both Men and 2002 and '03 finals, before Women's team finals.In the Venus prevailed in 2008 women's section, Parimala Devi championship match. Venus defeated Roshita Joseph 25-8, was trying to become the first 25-24. World Champion I woman since Steffi Graf in Illavazhaki faced tough chal- 1991-93 to win Wimbledon lenge from Yashika Rahubadde three years in a row. of Sri Lanka when she lost the first game 16-25 but recovered Serena became the second quickly to win the next two player in the Open era to win games 25-0, 25-3. Reigning the Wimbledon women's title Asian Champion Rashmi after overcoming a match Kumari out-pointed Nayana point, having done so in the Wickramasinghe at 25-6, 25-2. semifinals against Elena Dementieva. The only other » In the men's section, National champion B player to do it was Venus, who saved one in the 2005 Radhakrishnan routed Viraj Fernando 25-9, 25-2, final against Lindsay Davenport. while World Champion Yogesh Pardeshi was made to fight before emerging winner against Chamil Women's Doubles: Serena Williams and Venus Wil- Coorey 25-9, 14-25, 25-18. Hidyat Ansari defeated liams of US won women’s doubles title beating seasoned campaigner D Nishanta Fernando 25-16, Rennae Stubbs and Samantha Stosur of Australia 7- 25-17. 6(4), 6-4 on July 5, 2009. Serena Williams won a pair of Grand Slam titles at Wimbledon, just like her Wimbledon 2009 sister Venus did in 2008.It was their fourth Wimbledon title together, part of their haul of nine Men's Singles: Roger Federer of Switzerland won Grand Slam women’s doubles championships. his Sixth Grand Slam in Wimbledon after defeating Andy Roddick on a tiresome 5 sets with 14-16 score Men's Doubles: Daniel Nestor of Canada and Nenad on the last set in favor of Roger Federer. It was his Zimonjic of Serbia won their second straight record 15th Grand Slam title. It was the 6th Grand Wimbledon men’s doubles title, beating top-seeded Slam of Roger Federer’s 7 consecutive final appear- American twins Bob and Mike Bryan 7-6(7), 6-7(3), ance while it was Andy Roddick’s 3rd finals appear- 7-6(3), 6-3. ance in Wimbledon which all of his 3 final appearance fall in the hands of Roger Federer. Rafael Nadal Mixed Doubles: Mark Knowles (BAH) and Anna- who won the 2008 Grand Slam in Wimbledon, who Lena Groenefeld of GERmany won. defeated Federer on 5 grueling sets did not play for Boys' Singles: Andrey Kuznetsov of Russia the said tournament because of an injury. Roger Girls' Singles: Noppawan Lertcheewakarn of Thai- Federer had 15 ‘major’ in his possession, one more land than Pete Sampras.The Swiss reached his sixth title Boys' Doubles: Kevin Krawietz (GER) and Pierre- and regain the ‘number one’. Hugues Herbert (FRA) Girls' Doubles: Noppawan Lertcheewakarn (THA) Copyright © 2009 | WWW.UPSCPORTAL.COM 104

Section -4 (SPORTS) and Sally Peers (AUS). ITF Lexington Challenger Title: Second seeded Sania Mirza defeated top-seed Frenchwoman Julie Coin 7-6 (7/5), 6-4 to lift the International Tennis Federation (ITF) Lexington Challenger title. The 22- year-old Hyderabadi girl clinched the victory winning the 50,000 dollar title. With this win, she climbed up three places in the latest WTA singles rankings. She now stands the 80th. Bangladesh- West Indies Test series: Bangladesh won the test series beating the West Indies in the second and final Test on July 21, 2009. The victory was Bangladesh's first Test series win away from home - admittedly against a weakened and inexperi- enced West Indies side after senior players boycotted the series over a pay dispute - and the first time they have won two successive Tests. Bangladeshi stand- in captain Shakib Al Hasan was given the man-of- the-series award. Bangladesh- West Indies One-day series: Half- centuries from Junaid Siddique and Mahmudullah led Bangladesh to a three-wicket victory, and a 3-0 cleansweep of the One-Day International series over West Indies. Siddique struck six fours in 55 from 73 balls, and Mahmudullah, who was named man-of- the-match, hit two fours and one six in an unbeaten 51 from 70 balls to help Bangladesh overhaul a victory target of 249 in the third and final ODI at Warner Park. Bangladesh won the opening match in Dominica by 52 runs, and the second match at the same venue by three wickets. Their ODI series victory followed a cleansweep of the preceding two- Test series against a home side decimated by a player boycott. Copyright © 2009 | WWW.UPSCPORTAL.COM 105

Section -5 (AWARDS) Awards and focusing on gender and sustainable community PATA Awards development. The second award of the UNESCO King Sejong Literacy Prize goes to the NGO The tourism ministry of India was given two presti- Nirantar’s project “Khabar Lahariya” - “news waves” gious Pacific Asia Travel Association (PATA) gold - in Uttar Pradesh, northern India. It has created a awards for 2009 on August 3. It rural fortnightly newspaper entirely was declared the winner of two produced and marketed by “low awards in the marketing media - caste” women, distributed to more Travel Advertisement Broadcast than 20,000 newly literate readers. Media and Travel Poster category. Its well-structured method of train- PATA aims to promote the sustaining newly literate women as jour- able development of tourism in the nalists and democratizing informa- Asia Pacific region. Kerala Tour- tion production provides an easily ism was chosen for 2009 Pacific replicated model of transformative Asia Travel Association (PATA) education. Gold Award in the marketing destination category The UNESCO Confucius Prize: The UNESCO Confucius Prize for It was selected as "best in Literacy, supported by the People’s class" from amongst 236 entries Republic of China, also has two worldwide. The award ceremony will take place Sep awards. The first was given to the Pashai Language 25 during the PATA Travel Mart 2009 in Hangzhou, Development Project implemented by SERVE Af- China. Kerala Tourism also won national recogni- ghanistan, a British NGO. The community-owned tion, bagging the CNBC awards for Best Travel initiative provides meaningful literacy, livelihood, Destination and Best State Tourism Board, based on public health and nutrition education to about 1,000 a survey conducted across 12 cities in the country. Pashai ethnic minority men and women annually. UNESCO Literacy Prizes The second award of the UNESCO Confucius Prize for Literacy goes to the Municipal Literacy Coordi- King Sejong Literacy Prizes: A newspaper pro- nating Council, Municipality of Agoo, La Union, duced entirely by women in rural India “Khabar Philippines, for its Continuing Education and Life- Lahariya” was among the winners of year 2009 King long Learning Programme, which makes available a Sejong Literacy Prizes awarded by the United Na- vast array of education and training opportunities to tions Educational, Scientific and Cultural Organiza- the entire population, including the neediest. The tion (UNESCO) for innovative programs designed municipal authority’s leadership in coordinating ac- to teach marginalized populations how to read and tivities is a key factor in eliminating illiteracy and write. One of two awards of the UNESCO King sustaining lifelong learning in the area’s 49 villages. Sejong Literacy Prize, supported by the Republic of The Jury commended the project’s joint funding by Korea, goes to Tin Tua’s Literacy and Non-Formal the government, NGOs, the private sector and inter- Education Programme in eastern Burkina Faso. The national donors as exemplary. NGO’s name means “let’s help ourselves develop” in the Gulimancema language. The UNESCO International Literacy Prizes are awarded every year in recognition of excellence and It has achieved excellent results by using participants’ innovation in literacy throughout the world. Com- primary language, producing reading material locally, plying with the United Nations Literacy Decade Copyright © 2009 | WWW.UPSCPORTAL.COM 106

Section -5 (AWARDS) (UNLD) thematic calendar, the theme for year 2009 » Best Music director- Harris Jayaraj (Vaaranam Prizes was “Literacy and Empowerment”. The award Aayiram) ceremony will take place at UNESCO in Paris on the occasion of the celebration of International Lit- Telugu eracy Day, September 8. The King Sejong Literacy Prize was created in 1989 through the generosity of » Best Film: Gamyam the Government of the Republic of Korea. Each lau- » Best Director: Radha Krishna Jagarlamudi reate is awarded US $20,000. The UNESCO (Gamyam) Confucius Prize for Literacy was established in 2005 » Best Actor (Male): Allu Arjun (Parugu) through the generosity of the Government of the » Best Actor (Female): Swathi (Ashta Chemma) People’s Republic of China. Each laureate is awarded » Best Music: Micky J Mayor (Kotha Bangaru US $20,000. Lokam) The Greg Urwin Awards Malayalam Secretary General of the Pacific Islands Forum Sec- » Best Film: Thirakkatha retariat Tuiloma Neroni Slade announced the names » Best Director: Ranjith (Thirakkatha) of the first five recipients of an award of talent in the » Best Actor (Male): Lal (Thalappavu) region on August 5. The five award winners are from » Best Actor (Female): Priyamani (Thirakkatha) Fiji, Kiribati, Samoa, Tonga and Papua New Guinea. They are currently undertaking higher level academic Kannada studies as part of the Australian Leadership Awards scholarship program. The inaugural awards will sup- » Best Film: Moggina Manasu port vocational placements in a range of areas in- » Best Director: Shashank (Moggina Manasu) cluding, heath policy, oncology, education, law and » Best Actor (Male): Ganesh (Gaalipata) engineering. The award winners will begin taking up » Best Actor (Female): Radhika Pandit (Moggina their placements in 2010. Manasu) » Best Music: Harikrishna (Gaalipata) The Greg Urwin Awards were established in 2008 »Life time achievement award: Veturi in memory of the late Secretary General of the Fo- Sundararama murthy rum and are awarded to emerging Pacific Islander leaders in a range of fields by the Forum annually. World Young Reader Prize Idea Filmfare Awards 2008 for the South Malayala Manorama, a leading newspaper from Kerala, won the World Young Reader Prize for its 56th Idea Filmfare Awards 2008 for the South was project SAVE (Serve as a Volunteer for Energy) held at Hyderabad International Convention Centre which was aimed at reducing power consumption in (HICC) on July 31st night in a grand manner. Re- Kerala through students' activities. The project was cipients of important category are following: organised as a joint venture of Manorama and Kerala Power Department. The World Young Reader Prize Tamil was instituted by the World Association of Newspa- pers and News Publishing (WAN-IFRA). » Best Film- Subramaniapuram » Best Director- Sasikumar (Subramaniapuram) » Best Actor- Suriya (Vaaranam Aayiram) » Best Actress- Parvathy (Poo) Copyright © 2009 | WWW.UPSCPORTAL.COM 107

Section -5 (AWARDS) World Press Photo Contest Prize abled). Mexican photographer Carlos Cazalis was one of the Dronacharya Award: P. Gopi Chand (badminton), winners in World Press Photo contest 2009. The Jaydev Bisht (boxing), Baldev Singh (hockey) and photographer was given first prize in the Contem- Satpal (wrestling). porary Issues section. Other winners from Latin America included Lissette Lemus of El Salvador, who Dhyan Chand Award: Ishar Singh Deol (athletics) won first prize for daily life with this image about and Satbir Singh Dahya (wrestling). gang violence in her country, and Luiz Vasconcelos of Brazil, who impressed the judges with this shot of Rashtriya Khel Protsahan Puraskar: Tata Steel a woman resisting a police eviction of squatters from Limited (two awards, community sports identifica- private land near the city of Manaus, in the Brazilian tion and nurturing of budding talent and establish- state of Amazonas. The photo-of-the-year prize went ment and management of sports academies); Rail- to American photographer Anthony Suau. His win- way Sports Promotion Board (employment of ning image shows Det. sportspersons and sports welfare measures). Rashtriya Khel Puraskar 2009 Beijing Olympic Games bronze medal-winners Sushil FACTS TO BE REMEMBERED Kumar and Vijender Singh along with Four-time world champion pugilist (woman boxer ) MC Mary » Each Khel Ratna awardee would receive Rs. 7.5 Kom were chosen for coveted Rajiv Gandhi Khel lakh, the enhanced cash component of the award, Ratna award. Twice in the past the Khel Ratna award apart from a medal and a citation. was shared, once for a team event (yachtsmen Homi Motiwala and P. K. Garg in 1994) and on another occasion between an athlete and a shooter (K.M. » The Arjuna, Dronacharya and Dhyan Chand Beenamol and Anjali Bhagwat in 2002). But never awardees will get Rs. 5 lakh each in year2009, en- before had the award been given to three hanced from the previous Rs. 3 lakh, apart from statu- sportspersons. These awards were announced by the ettes and citations while the newly-introduced Union Sports Ministry on July 29. Rashtriya Khel Protsahan Puraskar winners will receive trophies and citations. Category wise award winner followings: » The awards will be presented by the President, Rajiv Gandhi Khel Ratna: M.C. Mary Kom Partibha Patil, at the Rashtrapati Bhawan, on Au- (women’s boxing), Vijender Singh (boxing) and gust 29. Sushil Kumar (wrestling). From the year 2009 onwards the award would be Arjuna Award: Mangal Singh Champia (archery), known by the year in which it is awarded. Sinimole Paulose (athletics), Saina Nehwal (badmin- Ramon Magsaysay Award 2009 ton), L. Sarita Devi (women’s boxing), Tania Sachdev (chess), Gautam Gambhir (cricket), Ignace Tirkey » Six individuals from Burma, China, India, the Phil- (hockey), Surinder Kaur (women’s hockey), Pankaj ippines, and Thailand were declared winners of Asia’s Navnath Shirsat (kabaddi), Satish Joshi (rowing), premier prize, the Ramon Magsaysay Award, for the Ronjan Sodhi (shooting), Poulomi Ghatak (table ten- year 2009. Established in 1957, the Ramon nis), Yogeshwar Dutt (wrestling), Girdhari Lal Yadav Magsaysay Award is Asia’s highest honor and is (yachting) and Parul D. Parmar (badminton, dis- widely regarded as the region’s equivalent of the Nobel Prize. It celebrates the memory and leader- Copyright © 2009 | WWW.UPSCPORTAL.COM 108

Section -5 (AWARDS) ship example of the third Philippine President, and is ing pragmatic, multisectoral, and collaborative ef- given every year to individuals or organizations in forts to ensure sustainable benefits for China’s envi- Asia who manifest the same sense of selfless service ronment and society.” that ruled the life of the late and beloved Filipino leader. » Ka Hsaw Wa, from Burma. He is being recognized for “his auntlessly pursuing non violent yet ef- The six 2009 Magsaysay awardees join 271 other fective channels of redress, exposure, and education laureates who have received Asia’s highest honor to for the defense of human rights, the environment, date. This year’s Magsaysay Award winners will each and democracy in Burma.” receive a certificate, a medallion bearing the likeness of the late President, and a cash prize. They will be formally conferred the Magsaysay Award during the Presentation Ceremonies to be held on Aug. 31, 2009 at the Cultural Center of the Philippines, to which the public is cordially invited. Winners are Follow- ing: » Krisana Kraisintu, from Thailand. She is being recognized for “her placing pharmaceutical rigor at the service of patients, through her untiring and fearless dedication to producing much-needed generic drugs in Thailand and elsewhere in the developing world.” » Deep Joshi, from India. He is being recognized for “his vision and leadership in bringing profession- alism to the NGO movement in India, by effectively combining ‘head’ and ‘heart’ in the transformative development of rural communities.” » Yu Xiaogang, from China. He is being recognized for “his fusing the knowledge and tools of social science with a deep sense of social justice, in assisting dam-affected communities in China to shape the development projects that impact their natural environment and their lives.” » Antonio Oposa, Jr., from the Philippines. He is being recognized for “his pathbreaking and passion- ate crusade to engage Filipinos in acts of enlight- ened citizenship that maximize the power of law to protect and nurture the environment for themselves, their children, and generations still to come.” » Ma Jun, from China. He is being recognized for “his harnessing the technology and power of information to address China’s water crisis, and mobiliz- Copyright © 2009 | WWW.UPSCPORTAL.COM 109

ADVERTISEMENT Buy Jawahar Publisher Books at Online Store Jawahar Book Centre and Publishers 62/1, Ber Sarai, Opp. J.N.U. Old Campus New Delhi-110 016 http://upscportal.com/store/tag/jawahar-publishers 1. (General Studies) INDIAN POLITY, CONSTITUTION AND PARLIAMENT by Jawahar Publication 2. (Miscellaneous) PHYSICS (FOR PRELIMS) by Jawahar Publication 3. (Miscellaneous) SOUTH AFRICA : RETROSPECT & PROSPECT by Jawahar Publication 4. (Miscellaneous) MANDAL COMMISSION REVISITED by Jawahar Publication 5. (Miscellaneous) THE PUBLIC SERVICE IN CANADA & INDIA by Jawahar Publication 6. (Miscellaneous) OPEN & DISTANCE EDUCATION by Jawahar Publication 7. (Miscellaneous) BIOTECHNOLOGY ADMISSION GUIDE by Jawahar Publication 8. (Miscellaneous) DISASTER MANAGEMENT by Jawahar Publication 9. (Miscellaneous) KNOWLEDGE BOOK OF SCIENCE: WHAT, HOW & WHY by Jawahar Publication 10. (Miscellaneous) BUDDHA by Jawahar Publication 11. (Miscellaneous) COMMERCE (FOR PRELIMS) by Jawahar Publication 12. (Miscellaneous) THE INDIAN KALEIDOSCOPE by Jawahar Publication 13. (Miscellaneous) EMINENT MODERN INDIAN POLITICAL THINKERS by Jawahar Publication 14. (Miscellaneous) JAWAHAR GATE COMPUTER SCIENCE by Jawahar Publication 15. (Book) JAWAHAR'S UGC/NET/SLET - MADE SIMPLE by Jawahar Publication 16. (English) UGC NET ENGLISH: A CRITICAL HANDBOOK OF LITERATURE IN ENGLISH by Jawahar Publication 17. (Maths) UGC NET/SLET MATHEMATICAL SCIENCE by Jawahar Publication 18. (Book) UGC NET/SLET COMPUTER SCIENCE by Jawahar Publication 19. (General Studies) GENERAL SCIENCE: OBJECTIVE QUESTIONS by Jawahar Publication 20. (General Studies) CONCISE HANDBOOK OF SCIENCE & TECHNOLOGY IN INDIA by Jawahar Publication 21. (General Studies) CONCISE HANDBOOK OF GENERAL STUDIES by Jawahar Publication 22. (General Studies) GENERAL STUDIES QUESTION BANK by Jawahar Publication 23. (Political Science) CONCISE HANDBOOK OF INDIAN POLITY by Jawahar Publication 24. (Political Science) ESSAYS ON INDIAN GOVERNMENT AND POLITICS: A Continuing Review 25. (Economics) LIBERALISATION & GLOBLISATION : WHEN & WHERE by Jawahar Publication 26. (Economics) INDIAN ECONOMY by Jawahar Publication 27. (Economics) CONCISE HANDBOOK OF INDIAN ECONOMY by Jawahar Publication 28. (Economics) THE URUGUAY ROUND by Jawahar Publication 29. (Sociology) A MASTER KEY SOCIOLOGY - PART TWO by Jawahar Publication 30. (Sociology) SOCIOLOGY: AN INTRODUCTION by Jawahar Publication 31. (Sociology) SOCIAL DEMOGRAPHY:A SYSTEMATIC EXPOSITION by Jawahar Publication 32. (Sociology) FUNDAMENTALS OF SOCIOLOGY by Jawahar Publication 33. (Sociology) STUDY OF INDIAN SOCIETY by Jawahar Publication 34. (Publicaion Administration) ANTHROPOLOGICAL THOUGHT by Jawahar Publication 35. (Public Administration) BETWEEN ANTHROPOLOGY & SOCIOLOGY by Jawahar Publication 36. (Public Administration) INTRODUCING SOCIAL-CULTURAL ANTHROPOLOGY by Jawahar Publication 37. (Public Administration) GENERAL ANTHROPOLOGY by Jawahar Publication 38. (Public Administration) INDIAN SOCIETY & CULTURE: CONTINUITY AND CHANGE by Jawahar Publication 39. (Public Administration) PUBLIC ADMINISTRATION QUESTION BANK by Jawahar Publication 40. (Public Administration) SOCIAL THEORY, DEVELOPMENT ADMINISTRATION & DEVELOPMENT ETHICS by Jawahar Publication 41. (Public Administration) RESTRUCTURING PUBLIC ADMINISTRATION: ESSAYS IN REHABILITATION by Jawahar Publication 42. (Public Administration) ORGANISATIONAL BEHAVIOUR by Jawahar Publication 43. (Public Administration) NEW HORIZONS OF PUBLIC ADMINISTRATION 44. (Geography) EXPECTED QUESTIONS ON GEOGRAPHY 45. (Geography) GEOGRAPHY (FOR PRELIMS) 46. (Geography) PRACTICAL GEOGRAPHY 47. (Geography) POLITICAL GEOGRAPHY & GEOPOLITICS : A Bibliography 48. (Geography) ENVIRONMENTECOLOGY & NATURAL RESOURCE MANAGEMENT 49. (Geography) OCEANOGRAPHY 50. (Geography) CLIMATOLOGY(General & Applied) 51. (Public Administration) RESTRUCTURING PUBLIC ADMINISTRATION: ESSAYS IN REHABILITATION by Jawahar Publication 52. (Public Administration) ORGANISATIONAL BEHAVIOUR by Jawahar Publication 53. (Public Administration) NEW HORIZONS OF PUBLIC ADMINISTRATION 54. (Geography) EXPECTED QUESTIONS ON GEOGRAPHY 55. (Geography) GEOGRAPHY (FOR PRELIMS) 56. (Geography) PRACTICAL GEOGRAPHY 57. (Geography) POLITICAL GEOGRAPHY & GEOPOLITICS : A Bibliography 58. (Geography) ENVIRONMENTECOLOGY & NATURAL RESOURCE MANAGEMENT 59. (Geography) OCEANOGRAPHY 60. (Geography) CLIMATOLOGY(General & Applied) http://upscportal.com/store/tag/jawahar-publishers Copyright © 2009 | WWW.UPSCPORTAL.COM 110

Section -6 (Model Test Paper) Civil Services (Main) Examination-2009 Solved Cum Study Notes Model Paper (General Studies) We are doing our best to provide you material for IAS main examination. With other topics, model paper cum study notes for GS second paper has been provided in this volume. Model paper cum study notes for GS first paper was already given to you in volume-4. Model cum study notes is new idea, which is more appropriate for understanding and keeping in mind for a long time and reproducing at the examination. In this process the our answers may be long and not followed the word limit. Its objective is to make easy to understand the whole issue and topic with associated facts. So read it carefully and do not forget to follow the word limit in examination hall… Time Allowed: Three Hours 3. Write about the following (answer to each ques- Maximum Marks: 300 tion should be in about 20 words) : 2x5=10 (a) Mini Pravasi Bharatiya Divas INSTRUCTIONS: (b) Global Indian Network of Knowledge Candidates should attempt all question strictly in ac- (c) Overseas Indian Facilitation Center (OIFC) cordance with the instructions given under each ques- (d) Overseas Workers Resource Centre (OWRC) tions. The number of marks carried by each question (e) Indian council of Overseas Employment (ICOE) is indicated at the end of the question (f) Indian Diaspora in Australia 1. Write notes on any two of the following (an- 4. Answer anyone of the following (in about 250 swer to each question should be in about 150 words): 30 words): 2x30=60 (a) What steps IMF recently has taken to support (a) Where and when was the meeting between the low-income countries during crisis? Prime Ministers of India and Pakistan held in 2009? (b) Discuss the situation of Foreign Direct Invest- ment (FDI) equity inflows in India and government’s What were the main decisions taken and how much efforts. it important for initiating the dialogue process with Pakistan? 5. Discuss any two of the following topics (answer each question in about 150 words) Why opposition parties are against of it? (a). A Challenge fund for Export Promotion Activi- (b) India-France relations ties (c) India and Chile (b). India and Global Meltdown (c). India- MERCOSUR Preferential Trade Agree- 2. Write about the following (answer to each ques- ment tion should be in about 20 wordS): 2x5= I 0 (a) INS Arihant 6. Write about the following (answer to each ques- (b) Afghan President Karzai’s visit to India tion in about 20 words) : 5x2 = 10 (c) Indo-Sri Lankan Economic Cooperation (a) Structural Adjustment Facility (SAF) (d) Strategic Partnership between India and (b) Rights Accumulation Program (RAP) Kazakhstan (c) Green Box (e) India and Nepal (d) NTMs (e). ICSID Copyright © 2009 | WWW.UPSCPORTAL.COM 111

Section -6 (Model Test Paper) 7. Write on any one of the following (answer in about 150 words): 15 (a) BRICS’ Joint Statement on Global Food Secu- rity (b) Ethnic Violence in Xinjiang 8. Briefly write about the following (in about 20 words each): 2x5 = 10 (a) G-5 and G-14 (b) Indo-Japan Mutual Trade (IMP) Get UPSCPORTAL , Jobs, Re- (c) Second World Conference Against Racism sults, Notification Alerts on Email. (d) Lebanese Parliamentary Elections (e) India as a political Force in East Asia Step-1: Fill Your Email address in form below. you will get a confirmation email within 9. Write about the following by expanding and 10 min. explaining the objectives (in about 20 Words each): 2x5=10 Step-2: Varify your email by clicking on the (a) ESCAP link in the email. (check Inbox and Spam fold- (b) APEC ers) (c) NAM (d) BIMSTEC Step-3: Done! Now you will regular Alerts (e) INTERPOL on your email. 10. Answer any one of the following in about 250 words: 30 (a). Give the brief account of India’s achievements in Space Programme in recent years. (b). What are the main uses of nanotechnology and its position in India? 11. Explain any three of the following (in about 150 words each) : 3x15=45 (a) Quantum Compute. (b) Virtually Engineering Power Plants (c) Param Sheersh Supercomputing facility (d) Tele-medicine facility for Rural India 12. Write brief notes on all the five (in about 20 words each) below: 5x2=10 (a) NAT (b) Robotic Therapy (c) Induced Pluripotent Stem Cell (d) WinZIP (e) H1N1 Copyright © 2009 | WWW.UPSCPORTAL.COM 112

ANSWERS Ans.1. (a) The Prime Minister of India Dr. Manmohan Singh and the Prime Minister of Pakistan Syed Yusuf Raza Gilani met on July 16, 2009 in the Egyptian resort city of Sharm-el-Sheikh, on the sidelines of the Non-Aligned Move- ment (NAM) Summit. The two Prime Ministers had a cordial and constructive meeting. They considered the entire gamut of bilateral relations with a view to charting the way forward in India - Pakistan relations. Both leaders agreed that terrorism is the main threat to both countries. Both leaders affirmed their resolve to fight terrorism and to cooperate with each other to this end. Indian Prime Minister reiterated the need to bring the perpetrators of the Mumbai attacks to justice. Prime Minister Gilani assured that Pakistan will do everything in its power in this regard. He said that Pakistan has provided an updated status dossier on the investigations of the Mumbai attacks and had sought additional information/evidence. Prime Minister Singh said that the dossier is being reviewed. Both leaders agreed that the two countries will share real time, credible and actionable information on any future terrorist threats. Prime Minister Gilani mentioned that Pakistan has some information on threats in Balochistan and other areas. Both Prime Ministers recognised that dialogue is the only way forward. Action on terrorism should not be linked to the Composite Dialogue process and these should not be bracketed. Prime Minister Singh said that India was ready to discuss all issues with Pakistan, including all outstanding issues. Dr Manmohan Singh reiterated India’s interest in a stable, democratic, Islamic Republic of Pakistan. Both leaders agreed that the real challenge is development and the elimination of poverty. They are resolved to eliminate those factors which prevent our countries from realizing their full potential. They agreed to work to create an atmosphere of mutual trust and confidence. Both leaders reaffirmed their intention to promote regional cooperation. Both Foreign Secretaries should meet as often as necessary and report to the two Foreign Ministers who will be meeting on the sidelines of the forthcoming UN General Assembly. The peace process started in September 2004 and came to a halt after four rounds of talks. Both sides claimed substantial progress on the eight subjects that came under the ambit of the composite dialogue, including Kash- mir, Siachen Glacier, confidence-building measures, Sir Creek, Wullar Barrage and terrorism and related subjects. Both sides admit that the dialogue process, which came to a halt yet again, in November 2008, has helped make a lot of progress towards resolving the contentious issues of Sir Creek and Siachen. The two sides resumed the process, which had been suspended following the terror attacks on the Mumbai suburban train network in July 2006, after the Prime Minister met Pakistan’s President, Pervez Musharraf, at the NAM Summit in Havana. The joint statement in Havana agreed not to link terrorism concerns to other key issues that were part of the designated composite dialogue process. The statement also announced the creation of an India-Pakistan institutional anti-terror mechanism to identify and implement counter-terrorism measures and initiatives. While in Pakistan the joint statement was received as a diplomatic victory and Gilani was hailed as a hero, in India Prime Minister Manmohan Singh was blamed for capitulating to Pakistan and has received widespread criticism for the compromises. He came under flak for deviating from India’s stated position on terrorism and composite dialogue since Pakistan has not taken any “credible and visible” action against the perpetrators of the 26/11 Mumbai attack. But Dr. Manmohan Singh said few hours after the release of the statement, that the peace talks would remain on hold until Islamabad took action against the perpetrators of the Mumbai attacks. “If acts of terrorism continue to be perpetrated, there is no question of dialogue, let alone a composite dialogue,” Manmohan Singh told the Indian media in Sharm-el-Sheikh. For a proper evaluation of the Joint Statement, the issues involved have to be looked at in a balanced perspec- Copyright © 2009 | WWW.UPSCPORTAL.COM 113

Section -6 (Model Test Paper) tive. Actually India did not gave a diplomatic blank cheque to Pakistan either on the “delinking” issue or on the inclusion of Balochistan. Pakistan has already submitted a dossier on action–taken-so-far, howsoever inadequate and half-hearted, against the terrorists involved in the Mumbai attack. The use of Pakistani territory and the involvement of Pakistan nationals have been admitted; the role of the Lashkar-e-Taiba has been acknowledged; five Lashkar operatives have been arrested and would be charge-sheeted, including the commander of the Mumbai attack, Zakiur Rahman Lakhvi. The Inter-Services Intelligence (ISI) chief has been in consultation with Indian High Commission officials in Islamabad on the action being taken in relation to the Mumbai case. To proceed further, Pakistan is seeking more information from India. Delinking in no way means that the composite dialogue would continue irrespective of Pakistan not doing anything regarding the Mumbai case or allowing a similar attack on India again. The joint statement is a political document and not a legally binding, unconditional international commitment. The criticism from the non-Left opposition parties and the Congress party’s lukewarm reception to the joint statement do not bode well for an early resumption of the dialogue process. Senior Congress functionaries sniped at the Prime Minster for agreeing to sign on to the statement. While the Congress formally supported the Prime Minister’s statement in Parliament, “off-the-record” leaks by senior Congressmen were critical of the alleged concessions given to Pakistan. The Bharatiya Janata Party was strident in its criticism of the Sharm-el-Sheikh statement just as it was of the Havana statement. Leader of the Opposition L.K. Advani was among the most vociferous critics of the Sharm- el-Sheikh statement. He led a walkout of BJP members in Parliament after describing the statement as “capitu- lation”. He later said the statement evoked “intense disquiet and concern among all thinking Indians, including sections of the Congress party”. He accused the Prime Minister of having surrendered India’s “diplomatic advantage over Pakistan” by delinking acts of terrorism from the composite dialogue process and the mention of the “Balochistan” issue. Ans 1 (b) Indian Prime Minister Manmohan Singh was chief guest on the occasion of Bastille Day march on July 14, 2009. On this day a detachment of 400 Indian soldiers proudly led the Bastille Day parade on the Champs-Elysées. ndian soldiers to participate in the Bastille Day march for the first time, French President Nicolas Sarkozy wanted to emphasize France's special relationship with India. Sarkozy is keen to help India elevate its role on the international scene by endorsing its candidacy to become a permanent member of the U.N. Security Council. He has bullishly asserted the need for expanding the G8 to the G14 by inviting emerging powers like India to join the elite club, and giving them a greater role in setting the global economic and geopolitical agenda. France enjoys a longstanding relationship with India. In the midst of the 18th century, the French Empire was close to conquering the entire subcontinent when Governor Dupleix was called back to France by the Compagnie des Indes (which had established a trade presence in India well ahead of its British rival, the East India Com- pany). France is keen to have full civil nuclear cooperation, including transfer of enrichment and reprocessing technology, with India, notwithstanding the G-8 declaration which vows to curb sharing of such knowhow with non- NPT nations.India had raised the issue of the nuclear cooperation against the backdrop of G-8 resolution with French President Nicolas Sarkozy during his visit to Paris. The Group of 8 industrialised nations, which includes France, had in a declaration committed to curb transfer of ENR technology and items to countries that have not signed the Non-Proliferation Treaty. India is among the countries which have not signed NPT. Earlier India and Copyright © 2009 | WWW.UPSCPORTAL.COM 114

Section -6 (Model Test Paper) France had entered into an accord for supplying reactors and fuel consequent to the Undo-US nuclear deal, the 123 agreement and clearance by the NSG to enable New Delhi to have full-scale civil nuclear cooperation. As a first step, Department of Atomic Energy had entered into a contract with French Nuclear supplier AR EVA NC for the supply of 300 tonnes of uranium ore concentrate and 60 tonnes were released under the first consignment which has been received by the NFC. India has received the first consignment of 60 tonnes of uranium from France for use as fuel to power its nuclear reactors following a clearance by the 45-member Nuclear Suppliers Group (NSG). The uranium ore would now be processed at the Nuclear Fuel Complex (NFC) here for use in safeguarded pressurized heavy water reactors (Phews). France is a leading world exporter of civilian nuclear technology. Reports say the deal includes providing India with France's latest model of the European Pressurised Reactor as well as other civilian nuclear material. The deal was good news for India - which is desperately short of energy to fuel its booming economy - and places it firmly as a world nuclear power. The deal in effect ends a ban which prevented countries from engaging in civilian nuclear trade with Delhi. The ban was imposed in 1974 when India used its civilian programme to produce and successfully test an atomic bomb. France is the world's second largest producer of nuclear energy after the United States. France and India have instituted a high-level, Strate- gic Dialogue at the level of National Security Advisors which provides both sides an opportunity to review the evolution of the overall global security situation and emerging challenges in various parts of the world. The 20th round of Strategic Dialogue took place in New Delhi on17th January, 2009. Annual consultations between the two foreign ministries are held at the level of Foreign Secretaries. The Foreign Office Consultations took place in Paris on 5th February, 2009. A special Joint Working Group on Terrorism has been established to aid cooperation in the fight against terrorism. A High Level Committee for Defence at the level of Defence Secretaries, working through its three specialized sub-committees, deals with issues related to our defence cooperation. The last meeting was held in Paris on 25th – 26th November, 2008. A Joint Committee for Economic and Technical Cooperation at the level of Ministers of Commerce, deals with issues related to commerce and trade. The last meeting was held in New Delhi on 16th -17th September, 2008. The erstwhile Indo-French Forum brought together eminent personalities and opinion makers of two countries from the fields of art, culture & technology, business and academia. The 11th Plenary Session of the IFF was held in Paris on 27th October, 2006. The 5th Coordinators’ Meeting of the IFF was held in New Delhi on 2nd April, 2007. During President Sarkozy’s visit to India in January, 2008, it was decided to convert the IFF into the CEOs’ Forum. The list of members from both sides has been exchanged. The first preliminary session of the CEOs Forum is scheduled for 26th June, 2009 in Paris. Economic and Commercial Relations: France is the 6th largest economy of the world and an important member of the G-8. Its technological strengths make it the leader in sectors such as aviation, space, food processing, transport, railways and agricultural research. However, France’s business interaction with India is not mmensurate with its intrinsic economic capacity. France is ranked 5th in the list of India’s trading partners among EU countries (after the UK, Belgium, Germany and Italy). Indo-French bilateral trade has been growing over the years. Indo-French trade, at € 6.78 billion, is still below the potential.In the Joint Statement issued at the conclusion of President Sarkozy’s visit to India in January 2008, it was decided to double the two-way trade by 2012, i.e. to increase from the then level of € 6.14 billion to almost € 12 billion. This was reiterated during PM Manmohan Singh’s visit to France in September, 2008. 13. French exports to India comprise mainly of aeronautical & space construction products, iron & steel products, electrical equipment and apparatus, measuring and process control equipment, organic chemical products, mechanical products, etc. Indian exports to France consist of a wide range of goods and services spread over a large base of Indian companies, especially from the small and medium Copyright © 2009 | WWW.UPSCPORTAL.COM 115

Section -6 (Model Test Paper) sector. While traditional items such as garments & textiles constitute a major share of India's exports to France, a number of newly developed non-traditional items such as food products, organic chemicals, refined petroleum products, etc. are showing promising growth. Foreign Direct Investment (FDI) approved from France from 1991 to October, 2008 is of the order of US$ 1.9 billion out of which the actual inflow is of the order of US$ 103 billion. The number of technical and financial collaborations approved with France is 952. France is the 9th largest foreign investor in the period August 1991 to October, 2008. During President Sarkozy’s visit to India, French interlocutors indicated that investments by major French companies were planned in the energy, automobile, aerospace, food processing and other sectors. Indian investments in France have also been growing. Indian companies are active in IT, pharmaceuticals, plastic industry and auto-parts etc. in France. In 2007, Indian companies invested around € 0.42 billion in France. French companies have recorded interest of investment of Euros 10 billion during 2007-2012. France should capitalize on the Indian community that already lives on its own soil—much as the U.S. and Britain have done via organizations like Silicon Valley's TiE (The Indus Entrepreneurs). This French minority group boasts 60,000 bilingual Franco-Indians who can act as sociocultural intermediaries to forge tight, knowledge-rich economic ties between the 65 million French and 1.15 billion Indians. The result could lift both countries. Ans 1 (c) Michelle Bachelet, President of the Republic of Chile paid a state visit to India from 16-20 March 2009, at the invitation of the President of India.The visit assumes special significance as it coincides with the 60th Anniver- sary of the establishment of diplomatic relations between India and Chile. The anniversary was marked by the holding of a special concert in New Delhi on 16th March 2009 at which both Indian and Chilean artists performed in the presence of the Presidents of both countries. During this visit both sides reviewed the state of bilateral relations and expressed satisfaction at the pace at which mutually beneficial cooperation is progressing. As democratic nations, Chile and India share values such as, respect for human rights and fundamental freedoms including religious, rule of law and tolerance. Prime Minister Singh and President Bachelet underlined the importance of enhancing trade and economic relations. They noted that the Preferential Trade Agreement [PTA] between Chile and India, in force since August 2007, has facilitated the growth in bilateral trade which reached US$ 2.3 billion in 2008. They welcomed the growing and dynamic trade relations and agreed that the PTA has opened new avenues for cooperation and investment for Chilean and Indian companies. Both Leaders evinced interest in exploring the feasibility of entering into a Free Trade Agreement and expressed satisfaction that the process of broadening and deepening of the existing PTA has already been initiated. It was also agreed to enhance the periodic exchanges of business missions and participation in each other’s trade fairs to facilitate promotion of their respective countries’ products and services. Both sides agreed to endeavour to double bilateral trade in the next five years. The two Leaders expressed interest in strengthening cooperation in new areas such as Information Technology (IT) and bio-technology in which India is regarded as a pioneer amongst developing nations. Both countries welcomed the growing interest of Chilean and Indian educational institutions in establishing stronger ties. They welcomed the Memorandum of Understanding between the University of Madrás and the Universidad de Talca, to be signed on 20th March 2009. They also noted that the proposal for signing a Cooperation Agreement on Gender Equality between both countries is at an advanced stage of consideration. Chile strongly condemned the terrorist attacks on Mumbai on 26th November 2008. Pursuant to the attacks, the President of Chile had written to the Prime Minister of India condemning the “heinous and cowardly terrorist attacks as they constitute crimes against humanity and a threat to human safety on a global scale”. Both Leaders called for enhanced international cooperation and exchange of information through appropriate channels in order to enhance the ability of the governments to fight terrorism. In this regard, they reiterated that early conclusion of the Comprehensive Convention on International Terrorism Copyright © 2009 | WWW.UPSCPORTAL.COM 116

Section -6 (Model Test Paper) is imperative to consolidation of counter terrorism efforts within the UN. India and Chile reiterated their continued commitment to multilateralism and the principles enshrined in the United Nations Charter. Chile and India reaffirmed their support for a comprehensive reform of the United Nations, including expansion of the Security Council to make this body more representative, legitimate and effective. Both nations stressed and acknowledged the need for continued efforts by the Member States to ensure meaningful and result-oriented intergovernmental negotiations. Chile reiterated its support for India's permanent membership on an expanded UN Security Council. They also confirmed their reciprocal support for each other’s candidature for non-permanent membership of the UN Security Council for 2011-12 for India and 2014-15 for Chile. Both countries seek a development-oriented, ambitious and balanced outcome to the Doha Development Round at the earliest. India and Chile reaffirmed their commitment to continue negotiations within the framework of the Bali Plan of Action in order to reach an agreed outcome for the effective implementation of the United Nations Framework Convention on Climate Change (UNFCCC). This outcome must respect the provisions and principles of the UNFCCC, in particular, the principle of common but differentiated responsibilities and respective capabilities. Chile and India agreed on the importance of the promotion of joint initiatives on R&D on advanced clean technologies with the objective of finding concrete and innovative solutions to the issue of climate change. In this regard, they urged developed countries to establish a global fund to promote renewable energy and clean technologies, both in terms of application of existing technologies as well as R&D into new and innovative technologies. The two Leaders held in-depth discussions about the ongoing financial and economic crisis and agreed that it was important that the regulatory failure in developed countries leading to the crisis should be urgently addressed. Ans. 2 (a) INS Arihant (S-73) is the lead ship of India's Arihant class of nuclear-powered submarines. It was launched by Prime Minister Manmohan Singh and his wife Gursharan Kaur on July 26, 2009 to mark the anniversary of Vijay Diwas (Kargil War Victory Day). INS Arihant is expected to formally join the Indian Navy in 2012 after undergoing extensive sea-trials.The 6,000-tonne vessel was built under the Advanced Technology Vessel (ATV) project at the Ship Building Centre in Visakhapatnam at a cost of US$2.9 billion. With the launch of the submarine India will join the exclusive club of US, Russia, China, France and the UK with similar capabilities. Arihant's primary weapon is stealth as it can lurk in ocean depths of half a kilometre or more and fire its missiles from under the sea. The 6000-tonne submarine is powered by an 85 megawatt capacity nuclear reactor and can acquire surface speeds of 22 to 28 kmph (12-15 knots) and submerged speed upto 44 kmph (24 knots). It will be carrying a crew of 95 men and will be armed with torpedoes and missiles including 12 ballistic missiles. The Rs 30,000-crore secret nuclear submarine project was started in the 1980s though it was conceived by then Prime Minister Indira Gandhi in the 1970s. Ans 2 (b) At the invitation Dr. Manmohan Singh, Prime Minister of India, Mr. Hamid Karzai, President of Afghanistan visited India in January 2009. The visit was symbolic specially to express Afghanistan’s solidarity with the Government and people of India in the wake of the Mumbai terrorist attack. The deplorable incident shows that terrorism is a threat to the entire humanity. During the visit, a joint statement was issued on January 12, 2009. The leaders called for the full compliance with bilateral, multilateral and international obligations of States to prevent terrorism in any manner originating from territories under their control since terrorism emanates from Copyright © 2009 | WWW.UPSCPORTAL.COM 117

Section -6 (Model Test Paper) the sanctuaries and training camps and the sustenance and support received by the terrorist groups. While reviewing their robust, strategic partnership, the two leaders expressed satisfaction at the progress in bilateral development and reconstruction projects in all parts of Afghanistan. India conveyed to President Karzai that, following the completion of the road from Zaranj to Delaram in South- western Afghanistan, a second major infrastructure project, the Pul-e-Khumri to Kabul transmission line and the sub-station at Chimtala in Northern Afghanistan, will be handed over shortly to the Government of Afghanistan. The both leaders expressed their satisfaction that the construction of the Afghan Parliament, a symbol of the common commitment of both countries to pluralism and democracy, also began. India conveyed that it will gift Afghanistan 250000 metric tonnes of wheat. The shipment will be effected immediately, as soon as the Govern- ment of Afghanistan has worked out its transportation arrangements. President Karzai invited Prime Minister Dr. Singh for a State Visit to Afghanistan. The invitation was accepted with pleasure. Both countries reaffirmed the special relationship between India and Afghanistan, to build a strong, united, and prosperous Afghanistan and to work towards peace, stability and development of the entire region. Ans 2. (c) India has permanent interest and commitment to the domestic political stability and peace in Sri Lanka as the developments in Sri Lanka affect the peace and order situation in some of Indian States, particularly Tamilnadu. On the economic front, for India, Sri Lanka is a small market and accounts for about 2 per cent of Indian exports and less than 1 per cent of Indian imports. India exports to Sri Lanka varieties of goods and services including transport equipment, cotton yarn, fabrics, readymade garments, iron and steel, machinery and instruments, sugar and wheat, drugs and pharmaceuticals, chemicals, glass and glassware, ceramics, cement and paper and wood products; and imports non-ferrous metals such as copper, spices, electronic goods, electrical machinery, scrap metal paper pulp and chemicals. The two countries have created a large legal framework to advance their cooperation: a free trade agreement; a double taxation avoidance agreement; and a series of bilateral agreements and understandings for cooperation in the areas of small-scale industries, agriculture, tourism, space and information technology and air travel facilities. The Free Trade Agreement between India and Sri Lanka came into full existence from March 1, 2000. A free trade arrangement between India and Sri Lanka has promoted mutually beneficial bilateral trade and strengthened intra-regional economic cooperation. Under the agreement zero duty on around 1000 items has been provided by India except for those in the negative list. Domestic value-addition requirements have been kept at 35 per cent With the introduction of FTA trade has grown rapidly between the two states. The FTA prompted a 257 per cent increase in bilateral trade between 2001 and 2004. Bilateral trade exceeded US $ 1.7 billion in 2004 and rose to US $ 2.025 billion in 2005. India is the 3rd largest destination for Sri Lankan exports. With FDI approvals of US $ 450 million, India is the 4th largest investor in Sri Lanka. Ans. 2 (d) Nursultan Nazarbayev, the President of the Republic of Kazakhstan, paid a State Visit to India from 23rd to 26th January 2009.He participated as the Guest of Honour at the Republic Day Parade. During the State Visit, President Nursultan Nazarbayev strongly condemned the terrorist attacks in Mumbai and reiterated the need for intensifying global cooperation in combating international terrorism. He also conveyed assurance that Kazakhstan stood firmly with India in dealing with the scourge of global terrorism. India and Kazakhstan called for early conclusion of the Comprehensive Convention on International Terrorism within the UN framework. Both Sides noted that this opened immense possibilities of cooperation in nuclear civil energy sector including in the mining Copyright © 2009 | WWW.UPSCPORTAL.COM 118

of uranium. The two Governments welcomed the signing of Memorandum of Understanding between Nuclear Power Corporation of India and National Atomic Company Kazatomprom JSC and recommended early conclusion of an Inter Governmental Agreement for Cooperation in Peaceful Uses of Nuclear Energy. The Indian Side conveyed that Kazakhstan ranks high in securing India's energy security and hoped that the conclusion of the Agreement is the beginning of a long term mutually beneficial cooperation in the hydrocarbon sector. Ans. 2 (e) India and Nepal share close and friendly political, economic, cultural and social ties, which are unique and have stood the test of time. During the visit of Foreign Secretary to Nepal on June 20-21, 2009, India reiterated its support to the new government of Nepal led by Madhav Kumar Nepal. Both sides also agreed to take the bilateral relations forward. Recently, there have been some media reports in Nepal regarding alleged encroach- ment of Nepalese territory by India. India investigated and found to the allegation false. There are bilateral institutional mechanisms for effective border management, including at district level, to address such concerns. In addition to these, it has also been agreed to establish local level mechanisms during the recent visit of Foreign Secretary to Nepal. Ans. 3 (a) The concept of mini PBD is based on requests received over the years from various quarters to organise it outside India to let the Indian Diaspora in the region benefit from the deliberations. This is particularly helpful to those large numbers of Indians in several regions who are not able to make it to the annual PBDs held in India. The first mini Pravasi Bharatiya Divas Convention was held in New York in September 2007 while the next one was organized at Singapore in October 2008. The next mini Pravasi Bharatiya Divas Convention titled ‘PBD Europe’ will be organised at the historic World Forum in The Hague on 19th September, 2009. This Convention is expected to bring together members of the Indian Diaspora in Europe at the common platform to discuss the role of the Indian Diaspora in enhancing Indo-European cooperation, opportunities and challenges faced by them in the fields of culture, heritage & tradition, as also Trade and Investment opportunities available for them in the land of their ancestors. Ans. 3 (b) The Ministry of Overseas Indian Affairs has launched a new initiative to develop a Diaspora Knowledge Net- work called – Global Indian Network of Knowledge (Global INK). This will serve as Knowledge Bank. The Global INK, an electronic platform will connect people of Indian Origin from a variety of disciplines recognized as leaders in their respective fields, not just in their country of residence but globally as well, with knowledge users at the national and sub national levels in India. The network will serve as a strategic ‘virtual think tank’. The Outcome targeted will be the germination of ideas on development, identification of the key elements in addressing the challenges to development and articulation and mapping out solutions through innovations and technological interventions. Ans. 3 (c) Ministry of Overseas Indian Affairs has set up an Overseas Indian Facilitation Center (OIFC) as a not-for-profit- trust, in partnership with Confederation of Indian Industry (CII). The Center is a ‘one stop shop’ for serving the interests of the Overseas Indian community and has the mandate to cover two broad areas (a) Investment Copyright © 2009 | WWW.UPSCPORTAL.COM 119

Section -6 (Model Test Paper) Facilitation and (b) Knowledge Networking. The objectives of the Centers are: » Promote Overseas Indian investment into India and facilitate business partnership, by giving authentic and real time information » Function as clearinghouse for all investment related information. This would be done by processing information on a real time basis through Information and Communication Technology (ICT) platform » Establish and maintain a Diaspora Knowledge Network (DKN) by creating a database of Overseas Indians, who would act as knowledge Diaspora and whose knowledge resources could be using ICT platform » Assist States in India to project investment opportunities to overseas Indians in the infrastructure and social sectors. The objectives of the OIFC will be to bring the Indian States, Indian Business and potential Overseas » Investors on the same platform and to facilitate the investors to identify the investment opportunities Provide a host of advisory services to PIO and NRIs. These could include matters such as consular questions, stay in India, investment and financial issues etc. An Overseas Workers Resource Centre (OWRC) has been set up as a helpline for assistance and protection of Indians working abroad and prospective emigrants with following objectives: 1. Information dissemination on matters relating to emigration 2. Registering, responding to and monitoring complaints received from emigrant workers 3. Grievance redressal and follow up with stakeholders Ans. 3 (d) Ministry of Overseas Indian Affairs had established an Overseas Workers Resource Centre (OWRC) on 8th January, 2008 during the Pravasi Bharatiya Divas. The Centre provides need based information and assistance to emigrants. Now an International toll free No. 800 091 202 53 has been added by the OWRC for the benefit of Indian emigrant workers and other information seekers in the three countries in the Gulf namely UAE, Saudi Arabia and Kuwait. This international toll free number can be reached 24/7 from these three countries. Ans. 3 (e) The Government of India has set up the Indian Council of Overseas Employment (ICOE) to serve as a ‘think tank’ for the promotion of overseas employment, better protection and welfare of overseas Indian workers and for the study of emerging overseas employment opportunities. One of the objectives of the ICOE is to study and analyse the trends in International labour markets. The ICOE is undertaking a study through the International Organization for Migration (IOM) on labour market assessment in six EU countries -France, Denmark, Czech Republic, Sweden, Romania and Poland. In addition, it has finalized a cooperation agreement with the European University Institute, Florence for collaborative research and studies relating to mobility of people between India and the European Union (EU). Copyright © 2009 | WWW.UPSCPORTAL.COM 120

Section -6 (Model Test Paper) Ans. 3 (f) 25 per cent of skilled migrants in Australia are Indians. From cooks, welders, plumbers, hairdressers, electri- cians, to engineers and accountants, the State of Western Australia is facing a shortage of skilled labour and professionals, and is keen on getting more skilled migrants from India. Some 43000 jobs would be created in the next ten years. Ans. 4 (a) In July 2009, the IMF’s Executive Board approved the package of measures that will sharply increase the loan resources available to low-income countries. The resources—including from the planned sale of IMF gold—are expected to boost the Fund’s concessional lending to up to $17 billion through 2014, including up to $8 billion over the next two years. The IMF announced zero interest payments up to the end of 2011 for all concessional loans to low-income members and lower interest rates on a permanent basis thereafter. A new set of lending instruments will underpin this increased support. The crisis originated in the advanced economies and has had its most visible impact on the emerging market countries. But a third wave of the crisis has threatened the remark- able economic achievements many low-income countries have made over the past decade. Package: As part of the response, the IMF has already more than doubled its financial assistance to low-income countries. New IMF concessional lending commitments to low-income countries through mid-July 2009 reached $2.9 billion compared with $1.5 billion for the whole of 2008. The new measures represent a significant additional effort in the coming years. The IMF support package includes: » Mobilization of additional resources, including from sales of an agreed amount of IMF gold, to boost the Fund’s concessional lending capacity to up to $17 billion through 2014, including up to $8 billion in the first two years. This exceeds the call by the Group of Twenty for $6 billion in new lending over two to three years. » Interest relief, with zero payments on outstanding IMF concessional loans through end-2011 to help low- income countries cope with the crisis. » Permanently higher concessionality of Fund financial support—with annual interest rates regularly reviewed so as to preserve a higher level of concessionality than previously. » Doubling of average loan access limits for low-income countries » A new set of financial instruments tailored to the diverse needs of low-income countries and better suited to meet the crisis challenges: 1. An Extended Credit Facility (ECF) to provide flexible medium-term support; 2. A Standby Credit Facility to address short-term and precautionary needs; and 3. a Rapid Credit Facility, offering emergency support with limited conditionality In addition, the IMF’s Executive Board recently backed the Managing Director's proposal for a new general allocation of $250 billion of Special Drawing Rights into the global economy, of which more than $18 billion will help bolster the foreign exchange reserves and relax the financing constraints of low-income countries. If approved by the IMF's Board of Governors, the proposed SDR allocation would take place at the end of August. The new lending windows are expected to become effective later this year, when donor countries have given Copyright © 2009 | WWW.UPSCPORTAL.COM 121

Section -6 (Model Test Paper) their final consent. At that time, existing concessional arrangements will automatically be converted into ECF arrangements. Existing arrangements under the Exogenous Shocks Facility, however, will remain in effect, and new ones that have already been prepared could still be approved during a three-month window. Need of Support: An IMF report on the implications of the global financial crisis for low-income countries had warned in March that the global financial crisis has hit poor countries especially hard, posing serious threats to their hard-won gains in boosting economic growth and creating a need for additional foreign financing to mitigate the impact of the crisis. Also in March, Tanzania President Jakaya Kikwete, Strauss-Kahn, and former UN Secretary-General Kofi Annan convened a conference in Dar es Salaam of government, business, civil society, and opinion leaders to address these issues. The IMF committed at the meeting to increase its support for Africa with more financing, greater flexibility, enhanced policy dialogue, and a further strengthening of Africa’s voice in the Fund. Fund: Some of the money to boost IMF lending to low-income countries will come from the envisaged sales of IMF gold. The IMF Executive Board will consider a plan for the Fund to sell about 400 metric tons of gold in order to create a new income model for the institution. In order to meet the financing needs of the low-income countries during the global crisis, some of the proceeds of those sales will be used to help provide new subsidy resources for the concessional lending to those countries. Resources linked to the gold sales will be used to help fund concessional lending to low-income countries in the following ways. First, windfall profits when the gold sales take place can be used for the subsidy resources. Windfall profits would derive from gold sales at an average price in excess of $850 per ounce—that is the price assumed in the new income model as necessary to fund the model. Second, to the extent that the realized windfall profits fall short of the required contribution, the remaining amount will be generated through investment income from the endowment funded by the gold sales. Ans. 4 (b) Foreign Direct Investment (FDI) equity inflows in the country have increased from US $ 5.5 billion in 2005-06 to US $ 27.31 billion in the year 2008-09. The FDI inflows in 2007-08 were US $ 24.58 billion and increased to US $ 27.31 billion in 2008-09, despite the economic slowdown, showing a percentage growth of 11% over the previous financial year. Government has put in place a liberal and investor-friendly policy on FDI under which FDI up to 100% is permitted on the automatic route in most sectors/ activities, including infrastructure and Research and Develop- ment (R&D). The UNCTAD World Investment Reports (WIR) 2007 & 2008, in their analysis of the global trends and sustained growth of Foreign Direct Investment (FDI) inflows, have reported India as the second most attractive location for FDI for 2007- 2009. India has retained the second place in A. T. Kearney’s 2007 Foreign Direct Investment Confidence Index, a position it has held since 2005. Government has also announced a slew of measures to accelerate the demand in the economy which would enable India to continue as an attractive investment destination. Under the liberalized economic environment, investment decisions of investors are based on the macro-economic policy framework, investment climate in the state, investment policies of the transnational corporations and other commercial considerations. The Government of India continues to make efforts to increase economic cooperation with the developing as well as developed countries through different fora such as Joint Commissions/Joint Committees, other bilateral channels like interaction with the delegations visiting the country and organizing visits abroad for discussions on issues of mutual interest and business/ investment meets between Indian and foreign entrepreneurs to stimulate foreign investment into India. The Department of Industrial Policy and Promotion also participates in discus- Copyright © 2009 | WWW.UPSCPORTAL.COM 122

Section -6 (Model Test Paper) sions covering industrial cooperation organized by other Ministries and Departments of Government of India and the Joint Business Council meetings. The Government of India also undertakes investment promotion activities through organisation of Destination India and Invest India events in various countries with FDI potential to create awareness about the investment climate and opportunities in India, as well as to provide support to potential investors. The Government of India, in partnership with various State Government and Business Associations, is making concerted efforts to make regulations conducive for business. In addition, the Government has initiated to implement e-Biz Project, a Mission Mode Project under the National e-Governance Project, to provide online registration, filing payment services to investors and business houses. In FDI equity investments mauritius tops the list of first ten investing countries followed by US, UK, Singapore, Netherlands, Japan, Germany, france, Cyprus and Switzerland. Between April 2000 and July 2008 FDI inflows from Mauritius stood at $ 30.18 billion followed by $5.80 billion from Singapore; $ 5.47 billion from the US; $ 4.83 billion from the UK; $ 3.12 billion from the Netherlands; $ 2.26 billion from Japan; $1.83 billion from Germany; $ 1.41 billion from Cyprus; and $1.02 billion from France. Ans. 5 (a) A Challenge fund for Export Promotion Activities by Indian Missions abroad, has been setup with a corpus of Rs. 5 crore, under the Market Access Initiative (MAI) scheme. The MAI scheme of the Department of Com- merce is an export promotion scheme envisaged to act as a catalyst to promote India's export on a sustainable basis. Since, Indian Missions abroad are also eligible for assistance under the scheme, a "Challenge Fund" has been created under the same. The MAI focus on the markets which in turn will focus upon product export promotion activities including innovative market promotion projects to showcase the Indian export capabilities. Projects relating to only market promotion activities shall be considered; export promotion of new items in India's export baskets by way of market development and market penetration and export promotion initiatives for Micro, Small and Medium enterprises (MSME) with a stress on regions and countries where India has a small bilateral trade profile (Africa and Latin America), shall be given priority; duplication of projects already implemented under the MAI/ MDA scheme of the Commerce Ministry is prohibited. The fund is used to finance specific export promotion schemes and projects which envisage introduction of new items of export towards diversification of the Indian export basket in the host country. These projects shall be proposed by Indian Missions abroad. Each individual project has been assigned a budget of Rs. 10 lakh. Priority shall be given to focused, specific projects with tangible results. The project proposals received shall be subjected to compete for funding on their merits. Ans. 5 (b) The subprime crisis that surfaced around August 2007 had affected financial institutions in the United States and Europe including the shadow banking system comprising inter alia investment banks, hedge funds, private equity and structured investment vehicles. With the collapse of Lehman Brothers and other Wall Street icons, there was growing recession which affected the US, the European Union (EU) and Japan. This was the result of large scale defaults in the US housing market as the banks went on providing risky loans without adequate security and the repaying capacity of the borrower. The principal source of transmission of the crisis has been the real sector, generally referred to as the ‘Main Street’. This crisis engulfed the United States in the form of creeping recession Copyright © 2009 | WWW.UPSCPORTAL.COM 123

Section -6 (Model Test Paper) and this worsened the situation. As a consequence, US demand for imports from other countries indicated a decline. Cause of Crisis: The basic cause of the crisis was largely an unregulated environment, mortgage lending to subprime borrowers. Since the borrowers did not have adequate repaying capacity and also because subprime borrowing had to pay two-to-three percentage points higher rate of interest and they have a history of default, the situation became worse. But once the housing market collapsed, the lender institutions saw their balance- sheets go into red. Impact on India: The effect on the Indian economy was not significant in the beginning. The initial effect of the subprime crisis was, in fact, positive, as the country received accelerated Foreign Institutional Investment (FII) flows during September 2007 to January 2008. This contributed to the debate on “decoupling,” where it was believed that the emerging economies could remain largely insulated from the crisis and provide an alternative engine of growth to the world economy. The argument soon proved unfounded as the global crisis intensified and spread to the emerging economies through capital and current account of the balance of payments (BoP). The net portfolio flows to India soon turned negative as Foreign Institutional Investors (FIIs) rushed to sell equity stakes in a bid to replenish overseas cash balances. This had a knock-on effect on the stock market and the exchange rates through creating the supplydemand imbalance in the foreign exchange market. The current account was affected mainly after September 2008 through slowdown in exports. Despite setbacks, however, the BoP situation of the country continues to remain resilient. It was found that the Foreign Direct Investment (FDI) started drying up and this affected investment in the Indian economy. It was, therefore, felt that the Indian economy will grow at about seven per cent in 2008-09 and at six per cent in 2009-10. The lesson of this experience is that India must exercise caution while liberalising its financial sector. A redeeming feature of the current crisis is that its magnitude is much lesser than that of the Great Depression of the 1930s when unemploy-ment rate in the United States exceeded 25 per cent. Currently, it stands at 6.5 per cent and is predicted to remain around eight per cent in 2009. The industries most affected by weakening demand were airlines, hotels, real estate. Besides this, Indian exports suffered a setback and there was a setback in the production of export-oriented sectors. The government advised the sectors of weakening demand to reduce prices. It provided some relief by cutting down excise duties, but such simplistic solutions were doomed to failure. Weakening demand led to producers cutting production. To reduce the impact of the crisis, firms reduced their workforce, to reduce costs. This led to increase in unemployment but the total impact on the economy was not very large. Industrial production and manufacturing output declined to five per cent in the last quarter of 2008-09. Consequently, a vicious cycle of weak demand and falling output developed in the Indian economy. A weakening of demand in the US affected India’s IT and Business Process Outsourcing (BPO) sector and the loss of opportunities for young persons seeking employment at lucrative salaries abroad. India’s famous IT sector, which earned about $ 50 billion as annual revenue, is expected to fall by 50 per cent of its total revenues. This would reduce the cushion to set off the deficit in balance of trade and thus enlarge our balance of payments deficit. It has now been estimated that sluggish demand for exports would result in a loss of 10 million jobs in the export sector alone. Government’s Efforts: To haul up the economy dented by recession the Government announced a package of Rs 35,000 crores in the first instance on December 7, 2008. The main areas to benefit were the following: (a) Housing - A refinance facility of Rs 4000 crores was provided to the National Housing Bank. Following this, public sector banks announced to provide small home loans seekers loans at reduced rates to step up demand in Copyright © 2009 | WWW.UPSCPORTAL.COM 124

Section -6 (Model Test Paper) retail housing sector. The housing package is the core of the government’s new fiscal policy. It will give a fillip to other sectors such as steel, cement, brick kilns etc. Besides, the small and medium industries (SMEs) too get a boost by manufacturing all kinds of fittings and furnishings. (b) Textiles - Due to declining orders from the world’s largest market the United States, the textile sector has been seriously affected. An allocation of Rs 1400 crores has been made to clear the entire backlog in the Tech- nology Upgradation Fund (TUF) scheme. (c) Infrastructure - The government has been proclaiming that infrastructure is the engine of growth. To boost the infrastructure, the India Infrastructure Finance Company Ltd. (IIFCL) has been authorised to raise Rs 14,000 crores through tax-free bonds. These funds will be used to finance infrastructure, more especially highways and ports. It may be mentioned that ‘refinance’ refers to the replacement of an existing debt obligation with a debt obligation bearing better terms, meaning thereby at lower rates or a changed repayment schedule. The IIFCL will be permitted to raise further resources by the issue of such bonds so that a public-private partnership (PPP) programme of Rs 1,00,000 crores in the highway sector is promoted. (d) Exports - Exports which accounted for 22 per cent of the GDP are expected to fall by 12 per cent. The government’s fiscal package provides an interest rate subsidy of two per cent on exports for the labour–intensive sectors such as textiles, handicrafts, leather, gems and jewellery. (e) Small and Medium Enterprises (SMEs) - The government announced a guarantee cover of 50 per cent for loans between Rs 50 lakhs to Rs 1 crore for SMEs. The lock-in period for loans covered under the existing schemes will be reduced from 24 months to 18 months to encourage banks to cover more loans under the scheme. Besides, the government will instruct state-owned companies to ensure prompt payment of bills of SMEs so that they do not suffer on account of delay in the payment of their bills. In short, the fiscal package is aimed at boosting growth in exports, real estate, auto, textiles and small and medium enterprises. The aim is to encourage growth and boost employment which have been threatened by the recession in the world economy, more especially in the United States. Just within a month, the government announced another package to bail out the Indian economy. The purpose of the new package announced on January 1, 2009 was to minimise the pain. On February 24, 2009, the government announced a slashing down of excise duty from 10 per cent to eight per cent - a reduction by two per cent. The entire stimulus package of Rs 30,000 crores to boost demand in the economy and thus reduce the impact of recession. Commerce and Industry Minister Kamal Nath announced a small relief package of Rs 325 crores for leather, textiles, gems and jewellery on February 26, 2009. Ans. 5 (c) India- MERCOSUR PTA has come into effect from 1st June, 2009. India with a total trade of US $ 4773.39 million with MERCOSUR during 2007-08, had exports of about US $ 2904.8 million during 2007-08 while imports stood at about US $ 1868.39 million during the same period. As a follow up to the said Framework Agreement, a Preferential Trade Agreement (PTA) between India and MERCOSUR was signed in New Delhi on January 25, 2004 and five annexes to this Agreement were signed incorporated on March 19, 2005. By this PTA, India and MERCOSUR have agreed to give tariff concessions, ranging from 10% to 100% to the other side on 450 and 452 tariff lines respectively. Copyright © 2009 | WWW.UPSCPORTAL.COM 125

Section -6 (Model Test Paper) The major product groups covered in the offer are food preparations, organic chemicals, pharmaceuticals, essential oils, plastics & articles thereof, rubber and rubber products, tools and implements, machinery items, electrical machinery and equipments. The break-up of the number of tariff lines for different MOPs is: - 393 tariff lines – 10%, 45 tariff lines – 20% and 14 tariff lines – 100%. The major sectors covered in offer list of India are meat and meat products, inorganic chemicals, organic chemicals, dyes & pigments, raw hides and skins, leather articles, wool, cotton yarn, glass and glassware, articles of iron and steel, machinery items, electrical machinery & equipments, optical, photographic & cinematographic apparatus. The break-up of the number of tariff lines for different margin of preferences (MOP) is:- 93 tariff lines – 10%, 336 tariff lines – 20% and 21 tariff lines – 100%. MERCOSUR is a trading bloc in South America region comprising of Argentina, Brazil, Paraguay and Uruguay. It was formed in 1991 with the objective of free movement of goods, services, capital and people and became a customs union in January 1995. MERCOSUR’s role model is European Union.A Framework Agreement had been signed between India and MERCOSUR on 17th June 2003 at Asuncion, Paraguay. The aim of this Frame- work Agreement was to create conditions and mechanisms for negotiations in the first stage, by granting reciprocal tariff preferences and in the second stage, to negotiate a free trade area between the two parties. Ans. 6 (a) A financial facility of the Fund established in 1986 to provide concessional loans to low-income Fund member countries. It recycled resources lent under the IMF's Trust Fund. It was superseded by the Enhanced Structural Adjustment Facility (ESAF) which was established in 1987 to promote stronger adjustment and reform measures than those under the SAF. The ESAF was replaced by the Poverty Reduction and Growth Facility in 1999. Ans. 6 (b) Rights Accumulation Program (RAP) is an economic program agreed between the IMF and an eligible member in protracted arrears to the IMF that provides a framework for the member to establish a satisfactory track record of policy and payments performance, and permits the member to accumulate rights to future drawings of IMF resources following clearance of arrears to the IMF, up to the level of arrears outstanding at the beginning of the program. Ans. 6 (c) Domestic support for agriculture that is allowed without limits because it does not distort trade, or at most causes minimal distortion. Ans. 6 (d) The Government examines the tariff and non-tariff measures (NTMs) imposed by developed countries especially on products of export interest for developing countries including steel. An Inter-Ministerial Committee has been constituted to co-ordinate the plan to tackle NTMs imposed by India’s trading partners by taking an effective remedial action. An institutional mechanism in the form of a database of NTMs imposed by other countries on India’s exports has also been created. Copyright © 2009 | WWW.UPSCPORTAL.COM 126

Section -6 (Model Test Paper) Ans. 6 (e) ICSID is an autonomous international institution established under the Convention on the Settlement of Invest- ment Disputes between States and Nationals of Other States with over one hundred and forty member States. The Convention sets forth ICSID's mandate, organization and core functions. The primary purpose of ICSID is to provide facilities for conciliation and arbitration of international investment disputes. Ans. 7. (a) The 1st BRIC- Brazil, Russia, India, China-summit took place in Yekaterinburg, Russia on June 16, 2009. The four heads of government from the BRIC countries attended. Joint Statement on Global Food Security was issued there.It was agreed by the national authorities in advance of the BRIC Summit. The fluctuations of global food prices coupled with the global financial crisis is threatening global food security. As a result, the number of people suffering from hunger and malnutrition grows and the progress towards the achievement of the Millennium Development Goals may be reversed. This challenge should be addressed without delay in a comprehensive manner through resolute action by all Governments and the relevant international agencies. The developed and developing countries should address the food security issue according to the principle of common but differentiated responsibility. The developed countries should provide financial and technology support for developing countries in the field of food production capacity. The BRIC countries welcome various initiatives in this field by the UN and its special agencies. The BRIC countries renew their commitment to contribute to the efforts to overcome the global food crisis. Countering effectively the global food crisis is impossible without a clear and full understanding of its causes. Attempts to explain food price hikes by an increase in consumption in developing countries obscure the true causes which have a complex and multifaceted nature. Global Climate Change and natural disasters have direct implications on food security through changes in agro-ecological conditions. Current global economic and financial crisis also has negative impact on food security through shrinking financial resources available to agriculture sector. Restricted market access and trade- distorting subsidies in developed countries have also hampered the development of food production capacity in developing countries over the last thirty years. Further, global market conditions have not created adequate incentives for the expansion of agricultural production in developing and least developed countries that have become main importers of food products. It is also important to assess the challenges and opportunities posed by the biofuels production and use in view not only of the world's food security, but also of the energy security and sustainable development needs. An international cooperation mechanism needs to be established to review and reevaluate the long-term implications of the development of biomass energy, and develop relevant policy guidance accordingly. The BRIC countries welcome, therefore, the exchange of experiences on biofuels technologies, norms and regulations, in order to ensure that production and use of biofuels is sustainable, in accordance with the three pillars of sustainable development – social, economic and environmental – and that it takes into account the need to achieve and maintain global food security. Sustainable biofuels can constitute a driving force for social inclusion and income distribution mainly in the impoverished rural areas of developing and least developed countries, where most of the world's famine problems are located. Tackling effectively the food crisis requires a fully coordinated international response and should include both short-term and long-term measures. The international community needs to work out and consistently implement Copyright © 2009 | WWW.UPSCPORTAL.COM 127

Section -6 (Model Test Paper) a comprehensive strategy to resolve this global problem. In this respect, the BRIC countries welcome the outcomes of relevant international fora, including the Food and Agriculture Organization (FAO) High-Level Con- ference on World Food Security in Rome. The BRIC countries also welcome the results of the World Grain Forum which was held in Saint Petersburg and call on all interested states and international organizations to take necessary steps to implement the measures agreed upon at the Forum. Ensuring food security requires a well-functioning world market and trade system for food and agriculture based on the principles of fairness and non-discrimination. In this regard, it is of paramount importance to accelerate the Doha round of talks at the World Trade Organization (WTO) in order to find compromise solutions for radical reductions of multibillion subsidies in the agricultural sector, which distort terms of trade and prevent developing countries from increasing their agricultural production. We are committed to opposing protectionism, establishing a just and reasonable international trade regime for agricultural products, and giving farmers from developing countries incentives to engage in agricultural production. The BRIC countries support the adoption of a wide range of mid- to long-term measures in order to provide for a solution to the issue of food security. Such measures may include: a) rendering additional resources and assistance to the agricultural sector through the channels of respective national budgets and international development institutions, mainly to household agriculture, which is the main source for food production; b) joint technological innovations and international cooperation to introduce advanced technologies in the agricultural sector of developing countries to significantly increase agricultural productivity. Intellectual property rights in the agricultural domain should strike a balance between the common good of humankind and incentives to innovation; c) upgrading agricultural infrastructure, including irrigation, transportation, supply, storage and distribution systems and promoting technical assistance, access to credit and crop insurance policies. In this context public- private partnerships could play a significant role; d) improving the exchange of knowledge and commercialisation of sustainable biofuels; e) ensuring wider access to food at the national and international level through appropriate policies and well functioning distribution systems especially for the poor and most vulnerable people in developing countries; f) sharing of best practices of operating successful public distribution programmes; and g) equipping developing countries with financial and technological means to fully implement adaptation measures to minimize the adverse impacts of climate change on food security. Ans. 7 (b) The recent ethnic violence between Uighur Muslims and Han Chinese erupted in China’s Xinjiang province on July 5. It captured the attention of the global media and China watchers. The violence deeply shattered the social-political life of the province, generating deep frustration among the local inhabitants; the orgy of violence was so powerful that a disturbed Hu Jintao, the President of China, had to leave the G-8 summit in Italy and Copyright © 2009 | WWW.UPSCPORTAL.COM 128

Section -6 (Model Test Paper) rushed back to Beijing. According to China, the violence of July 5 was an “international conspiracy” and hatched by six countries, such as Pakistan, Afghanistan, Kazakhstan, Turkey and the United States. China also blamed the World Uighur Con- gress’ leader, Rebiya Kadeer, a businesswoman and a former political prisoner, for leading the “separatist movement” from exile. The Uighurs are the very bottom of the heap economically in China. There is a very deep sense of frustration, especially among the unemployed young men.Many Uighurs complain that they have become second class citizens in their own homeland. Beijing has battled a low-level insurgency in Xinjiang for decades, but unrest has grown since 2007 as many Uighurs feel increasingly left behind by rapid economic growth that is mainly benefit- ing Han Chinese who have moved to the region. In fact, China’s policy of ‘go west’, failed to win the hearts and minds of the non-Han Chinese in Xinjiang. Han Chinese believe that the concession to the “one-child policy”, job reservation and relaxation in college entrance exams etc. have enormously benefited the non-Han Chinese; yet, the latter are ungrateful to the Chinese Government. Despite the development of Xinjiang, the separatist tendencies have been troubling the Chinese rulers in the region since the 1950s; and with the attack of 9/11, the demand for East Turkistan grew rapidly. In fact, the violence of July 5 is also a reflection of the “growing gap between the well-off Han Chinese and impoverished Uighurs”. Second, the non-Han Chinese in the region also feel culturally alienated. The rulers of post-Communist China must resolve the riddle of Han-versus-non-Han in Xinjiang so that peace and tranquillity thrives and the project of modernisation and development of Xinjiang continues without further obstacles and hindrances. Xinjiang’s Position: Historically, locally known as East Turkistan, Xinjiang was independent till 1933; in 1945, a group of rebels established an “independent republic” close to the Soviet Union. However, in 1949 the Chinese Communists with the help of the former Soviet Union established Xinjiang (New Territory). Demographically, in 1949, the Han Chinese in Xinjiang were only six per cent and increased to 40 per cent in 2009. On the other hand, between 1949 and 2009, the Uighurs in Xinjiang were reduced from 80 to 45 per cent. Xinjiang is a province of 20 million, out of which eight million Uighur Muslims refuse to follow the rule of the CPC. Xinjiang is the largest state of China (one-sixth) with the biggest resources of coal, oil and natural gas. In 2004 alone, the Tarin basin produced around five million tonnes of oil. Uighurs apart, Kazakhs and Tajiks also constitute minority groups of the region. While the Han Chinese follow Confucianism in routine life, and the local party cadres of the CPC preach atheism, the non-Han Chinese practise “Sufi mysticism”. As the religious institutions have been effectively banned in Xinjiang and the “Mandrain” has become a compulsory tool for higher education, the non- Han Chinese feel pain and agony at the very core of their heart. It is confirmed that demographic domination apart, a sort of cultural conflict is vividly visible in the social milieu of Xinjiang. From the point of view of geopolitics, Xinjiang shares its borders with eight countries, Kazakhstan, Kyrghyzstan, Tajikistan, Pakistan, Afghanistan, Russia, India and Mongolia; and in the economic sense, Xinjiang may be identified as a “gateway to Central Asia”. China’s oil experts frequently visit the oilfields of Central Asia, which also perturb the rulers of Central Asia, outfits of the Al-Qaeda and the military establishment of Pakistan. One must mention that constitutionally Xinjiang is an autonomous region of China; however, culturally and linguis- tically it is close to Central Asia. More importantly, while in the nineteenth century, Britain and Russia competed for the natural resources of Central Asia, in the post-Cold War era, China, Russia and the US are battling to capture the oil and gas of Central Asia. Culture apart, Xinjiang’s periodic violence is also a reflection of Central Asia’s “oil rivalry”. In this sense, China’s accusation against the West for troubling her in Xinjiang is not ground- Copyright © 2009 | WWW.UPSCPORTAL.COM 129

Section -6 (Model Test Paper) less. Knowing fully well the enormous importance of Central Asia and Xinjiang to “the development of China”, Mao was as eager to “build” Xinjiang as Deng. Factually, in 1949, Xinjiang was without a railway station; however, by the end of 1962, its capital Urumqi was connected with the Gansu province of China, and in 1984, Xinjiang’s western part was expanded connecting the cities of Turpan and Korla; by 2006, Xinjiang’s railway network expanded further adding 1,43,000 km. In 2009, Xinjiang is a province of 20 land ports with several metropolises. The Chinese rulers also have a plan to connect Xinjiang with Pakistan to help promote trade between China and Pakistan. China’s nuclear programme is also installed in Xinjiang. Ans. 8. (a) The meeting of the G-8 plus the G-5 and Egypt was held at in L’Aquila, Italy on 8th July, 2009. The President of Brazil spoke about the idea of a G-14 at the meeting. Brazil, China, India, Mexico and South Africa are the member of Group of Five. Italian Prime Minister Berlusconi said between the G-8 and the G-5 together - the G- 14 represents about 80 per cent of the world economy. He said that we might consider whether or not we should consider this a stable format for the future. One of the strongest supporters of idea of the G-14 which deals with larger governance issues was President Sarkozy actually in this meeting. The G-5 and G-8 had drawn up for the first time. He mentioned that this was a step forward where for the first time now in this Summit both the G-8 and G-5 were sitting and meeting for a considerable length of time. It was not just two hours of special session; it was all series of meetings. In fact, all of today they have been together and will be together tomorrow as well when the African countries join them. Then he gave the floor to the various G-5 and Egypt members who had just come to the meeting.There was considerable discussion on the need to reform international, not just financial institution, but also the institutions of international governance. Brazil's President Lula suggested to consider using own currencies within the G5 to settle own trading accounts with each other. Ans 8. (b) During the visit of Prime Minister of India to Japan in october 2008, both countries discussed the issues on bilateral, regional and multilateral relationship. On the WTO Doha Round negotiations, two countries shared the view that the early conclusion of the negotiations in vital for the maintenance and development of the international trade system, and agreed to continue their cooperation in advancing the negotiations towards the establishment of modalities early. India and Japan welcomed the substantive progress achieved for the establishment of a Project Development Fune (PDF) which is important to promote the Delhi-Mumbai Industrial Corridor (DMIC) Project. The two Ministers directed the officials to accelerate the establishment of the PDF. Both welcomed the active participation by the Japanese companies in the Five Bird Projects. Ans 8. (c) The second World Conference Against Racism (WCAR), held at the U.N.’s European headquarters in Geneva in April 2009. It was, like the first one in Durban in 2001. Its objective was to evaluate the progress made towards the goals set eight years ago in South Africa. So it was called Durban Second. At the 2001 conference, the overwhelming majority of nations had condemned the legacy of colonialism, the slave trade, and racism in the contemporary era. Most of the delegates present in Durban had equated Zionism with racism. Israel, the United States and Canada boycotted the Durban Review Conference, or Durban II, in Geneva on the flimsy grounds that the Jewish state was being targeted for unnecessary criticism. Israel and Canada, which has a right-wing government, decided last year itself to boycott the conference. There was considerable pressure Copyright © 2009 | WWW.UPSCPORTAL.COM 130

Section -6 (Model Test Paper) from liberal groups in the U.S. on the Barack Obama administration to participate in the conference. The U.S. State Department had in fact thanked the organisers for taking American sensibilities into consideration while preparing for the conference. Another positive signal from the White House was the U.S. decision to join the United Nations Human Rights Council. Ans 8. (d) The pro-West March 14 coalition emerges victorious in the closely contested parliamentary elections of June 7 in Lebanon. The victory of the pro-United States March 14 alliance, a coalition of anti-Syrian political parties led by Saad Hariri, in the closely contested Lebanese parliamentary elections of June 7 came as a relief to the pro- Western states in the West Asian region. U.S. President Barack Obama was among the first heads of state to congratulate the people of Lebanon on the choice they made. Last-ditch efforts by the U.S., Saudi Arabia, Egypt and France seemed to have tilted the scales in favour of the March 14 alliance. The coalition derives its name from the day on which a massive demonstration was held in Beirut in 2005 against Syrian influence in Lebanon, a month after the assassination of former Prime Minister Rafiq al-Hariri. The West had portrayed the elections as a proxy fight with Iran for influence over Lebanon. The U.S. had unilaterally designated Hizbollah, which represents the downtrodden Shia populace, as a “terrorist” organisation. The Lebanese people were fully aware that soon after Hamas won the elections in Palestine, Washington reacted by cutting off financial aid, and gave the green signal to Israel to launch an attack. Under Lebanon’s complicated electoral laws, which are dictated by its sectarian political system, the parliamentary seats are equally divided between Muslims and Christians. They are further divided between the 18 officially recognised religious sects, which include Sunnis, Shias, Alawites, Maronite Christians, Greek Orthodox, Arme- nian Christians and the Druze, which is an off-shoot of Islam. Until the 1940s, the Muslim and Christian populations were almost evenly divided. Today, the Christian population is fast declining and constitute less than 30 per cent, according to many experts. Most of the Lebanese diaspora consists of Christians. Because of sectarian sensitivities, no official census has been conducted since 1932. The French colonialists, while creating the state of Lebanon, had envisaged it as a Christian state. Until the 1960s, right-wing Christian parties had monopolised power in the country. Ans 8 (e) India’s increasing political visibility in East Asia, in the company of the United States and Japan, has already given grist to the thought mills. At the height of the latest poll campaign, the U.S. and India held a high-profile naval exercise with Japan along the waters close to China. Despite the official line that the U.S.-India-Japan exercise was not a move against China, Manmohan Singh’s mandate is seen as opening new geopolitical options too. Crystal-gazing in this domain is still confined largely to the parlours of non-official experts in strategic affairs. However, East Asian governments are expected to monitor closely Manmohan Singh’s foreign policy in the new innings. As East Asian political leaders scan the scene, India should now try to integrate itself into the regional networks of inter-state relations. India is a founding member of the East Asia Summit (EAS), a forum comprising 16 countries. However, it is an empirical reality that India lags behind China and Japan in almost all spheres of pan-East Asian cooperation As of now, the U.S. remains outside the EAS, although the Barack Obama administration recently indicated its readiness to enter this forum. A critical pre-requisite is to accede to the ASEAN Treaty of Amity and Coopera- tion (TAC). After several years of a general aversion to it, Washington is now willing to begin its domestic process of acceding to the TAC. China and Japan as also South Korea tend to play lead roles within the EAS. Copyright © 2009 | WWW.UPSCPORTAL.COM 131

Section -6 (Model Test Paper) Doubtless, India is an equal member of the EAS, alongside these three countries besides the 10 ASEAN members, Australia and New Zealand. East Asian diplomats think that New Delhi has yet to take a major initiative towards the regional security dialogue. In some contrast, it is noted that Australian Prime Minister Kevin Rudd has proposed a new Asia Pacific Community. The idea of a pan-Asia economic group, outlined by Manmohan Singh a few years ago, is seen in East Asia as just that: an idea and not a political initiative. Ans. 9 (a) The United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) is the regional development arm of the United Nations for the Asia-Pacific region. Established in 1947 with its headquarters in Bangkok, Thailand, ESCAP seeks to overcome some of the region’s greatest challenges. It carries out work in Macroeconomic Policy and Development, Statistics, Subregional activities for development, Trade and Invest- ment, Transport, Environment and sustainable development, Information and Communications Technology and Disaster Risk Reduction,Social Development. Ans. 9 (b) Asia-Pacific Economic Cooperation (APEC) is a forum for 21 Pacific Rim countries (styled 'member economies') to cooperate on regional trade and investment liberalisation and facilitation. APEC's objective is to enhance economic growth and prosperity in the region and to strengthen the Asia-Pacific community. Members account for approximately 40% of the world's population, approximately 54% of world GDP and about 44% of world trade. Ans. 9 (c) The Non-Aligned Movement (NAM) is an international organisation of states considering themselves not formally aligned with or against any major power bloc. The movement is largely the brainchild of India's first Prime Minister Jawaharlal Nehru, former president of Egypt Gamal Abdul Nasser and Yugoslav president Josip Broz Tito. It was founded in April 1955; as of 2007, it has 118 members. The purpose of the organisation as stated in the Havana Declaration of 1979 is to ensure "the national independence, sovereignty, territorial integrity and security of non-aligned countries" in their "struggle against imperialism, colonialism, neo-colonialism, racism, and all forms of foreign aggression, occupation, domination, interference or hegemony as well as against great power and bloc politics." The 15th Non-Aligned Movement (NAM) Summit held in Sharm el-Sheikh, a Red Sea resort city in Egypt on July 16, 2009. Member countries reached consensus on promoting solidarity and ratified documents on jointly addressing international and regional issues. At the two-day summit held in this Egyptian Red Sea coastal city, leaders from over 100 NAM countries or their representatives focused their debate on the summit's theme of International Solidarity for Peace and Development. They extensively discussed international and regional problems, such as the ongoing global financial crisis, climate change, the Middle East peace process, food security, energy and nuclear issues. The Summit admitted Argentina as NAM observer country and the World Peace Council as its observer organization. Egyptian President Hosny Mubarak was elected as NAM Chairperson for the following 3 years Ans. 9 (d) On 6 June 1997, a new sub-regional grouping was formed in Bangkok and given the name BIST-EC (Bangladesh, India, Sri Lanka, and Thailand Economic Cooperation). Myanmar attended the inaugural June Meeting as an Copyright © 2009 | WWW.UPSCPORTAL.COM 132

Section -6 (Model Test Paper) observer and joined the organization as a full member at a Special Ministerial Meeting held in Bangkok on 22 December 1997, upon which the name of the grouping was changed to BIMST-EC. Nepal was granted observer status by the second Ministerial Meeting in Dhaka in December 1998. Subsequently, full membership has been granted to Nepal and Bhutan in 2003. In the first Summit on 31 July 2004, leaders of the group agreed that the name of the grouping should be known as BIMSTEC or the Bay of Bengal Initiative for Multi-Sectoral Techni- cal and Economic Cooperation. According to the Bangkok Declaration on the Establishment of BIST-EC, the aims and purposes of BIST-EC/ BIMST-EC are to create an enabling environment for rapid economic development, accelerate social progress in the sub-region, promote active collaboration and mutual assistance on matters of common interest, provide assistance to each other in the form of training and research facilities, cooperate more effectively in joint efforts that are supportive of, and complementary to national development plans of member states. The 2nd BIMSTEC Summit was held on 13 November 2008 in New Delhi, India. The 2nd BIMSTEC Summit has given a strong political impetus to the strengthening of BIMSTEC cooperation in the identified 13 priority sectors. Ans. 9 (e) It is the world’s largest international police organization, with 187 member countries. Created in 1923, it facilitates cross-border police co-operation, and supports and assists all organizations, authorities and services whose mission is to prevent or combat international crime. INTERPOL aims to facilitate international police co-operation even where diplomatic relations do not exist between particular countries. Action is taken within the limits of existing laws in different countries and in the spirit of the Universal Declaration of Human Rights. INTERPOL’s constitution prohibits ‘any intervention or activities of a political, military, religious or racial character.’ The President of INTERPOL and the Secretary General work closely together in providing strong leadership and direction to the Organization. Ans. 10 (a) Indian Space programme witnessed several major successes and reached great heights the year 2008 by successfully orbiting an un-manned spacecraft Chandrayaan-1 around the Moon, launching of ten satellites in a single launch, conducting acceptance test of indigenously developed cryogenic engine successfully and the launching of a commercial satellite for an international customer. India, in its space endeavours achieved a rare feat at 20:31 hrs on November 14, 2008 by placing the Indian tri colour when the Moon Impact Probe (MIP), one of the payloads on Chandrayaan-1 spacecraft hit the lunar surface and joined select band of countries who have placed an object on the Moon. PSLV-C11/Chandrayaan-1 Mission: Chandrayaan-1 spacecraft, India`s first un-manned mission to the Moon was launched successfully from the Satish Dhawan Space Centre in Sriharikota on October 22, 2008. The spacecraft was put into a transfer orbit with a perigee (nearest point to Earth) of 255 km and an apogee (farthest point to Earth) of 22,860 km, inclined at an angle of 17.9 deg to the equator. The orbit of the spacecraft was gradually raised by firing the Liquid Engine onboard Chandrayaan-1 spacecraft through carefully planned manoeuvres and was successfully inserted into the lunar orbit on November 8, 2008. Subsequently, the orbit of Chandrayaan-1 was lowered to 100 km through several manoeuvres. Chandrayaan-1 is India’s first spacecraft mission beyond Earth’s orbit. It aims to expand our knowledge about Earth’s only natural satellite – the moon by performing remote sensing of the moon using the instruments built in India and five other countries. Chandrayaan-1 mission aims to expand scientific knowledge about the moon Copyright © 2009 | WWW.UPSCPORTAL.COM 133

Section -6 (Model Test Paper) and to provide challenging opportunities for planetary research to the younger generation of Indian scientists. These aims are planned to be achieved through high-resolution remote sensing of moon in the visible, near infrared, microwave and X-ray regions of the electromagnetic spectrum. With this, preparation of a 3-dimensional atlas of the lunar surface and chemical and mineralogical mapping of entire lunar surface is intended. PSLV-C9/CARTOSAT-2A/IMS-1 MISSION: Indian Space Research Organisation created a record on April 28, 2008 by successfully launching Polar Satellite Launch Vehicle - PSLV-C9 placing ten satellites, viz., CARTOSAT-2A, Indian Mini Satellite (IMS-1) and eight nanosatellites from abroad into the orbit. Polar Satel- lite Launch Vehicle with thirteen consecutively successful flights so far, has repeatedly proved itself as a reliable and versatile workhorse launch vehicle. It has demonstrated multiple satellite launch capability having launched a total of sixteen satellites for international customers besides fourteen Indian payloads including Chandryaan-1 and satellites for remote sensing, amateur radio communications and Space capsule Recovery Experiment (SRE- 1). PSLV was used to launch ISRO’s exclusive meteorological satellite, KALPANA-1, into a Geosynchronous Transfer Orbit (GTO) in September 2002 and thus proved its versatility. CARTOSAT-2A carries a panchromatic camera (PAN) capable of taking black-and-white pictures in the visible region of electromagnetic spectrum. The highly agile CARTOSAT-2A is steerable along as well as across the direction of its movement to facilitate imaging of any area more frequently. High-resolution data from CARTOSAT- 2A will be invaluable in urban and rural development applications calling for large scale mapping. The PAN camera onboard CARTOSAT-2A has started beaming high quality imagery of India and other parts of the globe. Indian Mini Satellite (IMS-1), flown as an auxiliary payload on board PSLV-C9, is developed by ISRO for remote sensing applications. Weighing 83 kg at lift-off, IMS-1 incorporates many new technologies and has miniaturised subsystems. IMS-1 carries two remote sensing payloads – A Multi-spectral camera (Mx Payload) and a Hyper-spectral camera (HySI Payload), operating in the visible and near infrared regions of the electromagnetic spectrum. The data from this mission will be made available to interested space agencies and student community from developing countries to provide necessary impetus to capacity building in using satellite data. The cameras onboard the versatile IMS-1 has been providing high quality imagery. Indiaonal Satellite (Insat) System: Having established the need for a domestic communication satellite through Satellite Instructional Television Experiment (SITE) using ATS-6 satellite of USA during 1975-76, Satellite Telecommunication Experimental Project (STEP) using Franco-German Satellite Symphonie in 1978-79 and by building and utilising experimental communication satellite APPLE, the Indian National Satellite-1 (INSAT) system was operationalised in 1983. INSAT-1 satellites procured from abroad were multipurpose satellites providing telecommunication, TV broadcasting and meteorological services. INSAT-2, 3, 4 and GSAT satellites designed indigenously with higher power, more weight and capability to provide various services have been built and operationalised. India now has one of the largest domestic communications satellite systems in the Asia Pacific region with 11 operational satellites in orbit with more than 210 transponders providing vital services to the country. The meteorological data from INSAT system is used for quick dissemination of warnings against impending disaster from approaching cyclones, specially designed receivers have been installed at vulnerable coastal areas in the country for direct transmission of warnings to the officials and public using INSAT broadcast capability. EDUSAT, a satellite dedicated for providing educational services, was launched in September 2004. EDUSAT is providing a wide range of educational delivery modes like one-way TV broadcast, interactive TV, video conferencing, computer conferencing, web-based instructions, etc. About 34,000 class rooms that utilise EDUSAT covering 23 states have been setup across the country. These networks connect have been setup at different schools, colleges, training institutes and other departments. Telemedicine is another important initiative to use Copyright © 2009 | WWW.UPSCPORTAL.COM 134

Section -6 (Model Test Paper) space technology for societal benefits. It has enabled the population, even in the remotest parts, access to super specialty medical care. Indian Remote Sensing (Irs) Satellite System: Using remote sensing satellites for earth observation was initiated with the design and development of experimental remote sensing satellites Bhaskara-1 and Bhaskara-2 during mid 70s. With seven satellites in operation - IRS-1D, OCEANSAT-1, Technology Experiment Satellite (TES), RESOURCESAT-1, CARTOSAT-1, CARTOSAT-2, CARTOSAT-2A - Indian Remote Sensing Satellite System is the largest civilian remote sensing satellite constellation in the world and provides imageries in a variety of spatial resolutions from better than one meter (CARTOSAT-2 & 2A) to 188 meter (IRS-1D). Forthcoming satellites include OCEANSAT-2, RESOURCESAT-2 and a new Radar Imaging Satellite, RISAT that can overcome the present limitation of imaging under cloudy conditions. Using the data from IRS satellites, a variety of application programmes such as Groundwater Prospects Mapping, Crop Acreage and Production Estimation, Potential Fishing Zone Forecast, Biodiversity Characterisation at landscape level, covering four main biodiversity rich regions of the country - NE Region, Western Himalayas, Western Ghats and Andaman and Nicobar Islands - have been operationalised. Satellite Launch Vehicles: From launching of modest sounding rockets of the 1960s, India has now acquired capability to launch remote sensing satellites using Polar Satellite Launch Vehicle (PSLV) and geosynchronous communication satellites using GSLV. PSLV is capable of launching more than 1.5 tonne satellite into polar sun- synchronous orbit. Geosynchronous Satellite Launch Vehicle (GSLV) can launch a 2 to 2.5 tonne satellite into Geo-stationary Transfer Orbit (GTO). GSLV has four successful flights out of five missions with the last one being GSLV-F04/INSAT-4CR mission on September 2, 2007. Development of an indigenous cryogenic stage to replace the presently used Russian cryogenic stage has been successfully realised. Flight acceptance test of the cryogenic engine was conducted successfully on December 18, 2008. GSLV-Mk III, which is under development, will be capable of launching satellites weighing four tonne into GTO. Several developments including recoverable and reusable space transportation systems are in progress with the objective of reducing the cost of access to space. Commercial Successes: Antrix, the commercial arm of the Department of Space, is a single window agency for marketing Indian space capabilities. It is playing a key role in the worldwide availability of IRS data through Geoeye, USA. Antrix also provides IRS data processing equipment. Antrix offers launch services using India’s PSLV. So far sixteen satellites have already been successfully launched by PSLV for various international customers. Through Antrix, Telemetry, Tracking and Command support from the Indian ground stations are offered to various satellite operators. Similarly, lease of transponders from INSAT system has been made possible. In this regard, 11 transponders have already been leased to INTELSAT. Customers for the spacecraft components offered by Antrix include world’s leading spacecraft manufacturers. During the year, W2M satellite built by ISRO/Antrix under an agreement entered into with EADS Astrium, Paris was launched successfully on Decem- ber 20, 2008. Besides, Antrix has won contracts from Europe and Asia for launch services in the highly competitive international launch services market. After the successful development of a low cost, compact, modular and rugged Automatic Weather Station (AWS) in co-ordination with industry, the technology has been licensed to industry for regular production. Ans. 10 (b) Nanotechnology is useful in Medicine, Energy, Information and communication, Heavy Industry, Consumer goods, Optics, Textiles, Agriculture etc. The biological and medical research communities have exploited the unique properties of nanomaterials for various applications. Terms such as biomedical nanotechnology, Copyright © 2009 | WWW.UPSCPORTAL.COM 135

Section -6 (Model Test Paper) bionanotechnology, and nanomedicine are used to describe this hybrid field. Nanotechnology-on-a-chip is one more dimension of lab-on-a-chip technology. Biological tests measuring the presence or activity of selected substances become quicker, more sensitive and more flexible when certain nanoscale particles are put to work as tags or labels. The overall drug consumption and side-effects can be lowered significantly by depositing the active agent in the morbid region only and in no higher dose than needed. This highly selective approach reduces costs and human suffering. Nanotechnology can help to reproduce or to repair damaged tissue. “Tissue engineering” makes use of artificially stimulated cell proliferation by using suitable nanomaterial-based scaffolds and growth factors. Tissue engineering might replace today’s conventional treatments like organ transplants or artificial implants. Advanced nanotechnology based tissue engineering might lead to some life extension, but not significant amounts--that would require intracellular manipulation of the seven mechanisms of aging, which tissue engineering cannot do. For patients with end-state organ failure, there may not be enough healthy cells for expansion and transplanta- tion into the ECM (extracellular matrix). In this case, pluripotent stem cells are needed. Chemical catalysis and filtration techniques are two prominent examples where nanotechnology already plays a role. The synthesis provides novel materials with tailored features and chemical properties: for example, nanoparticles with a distinct chemical surrounding (ligands), or specific optical properties. The most advanced nanotechnology projects related to energy are: storage, conversion, manufacturing improvements by reducing materials and process rates, energy saving (by better thermal insulation for example), and enhanced renewable energy sources. A reduction of energy consumption can be reached by better insulation systems, by the use of more efficient lighting or combustion systems, and by use of lighter and stronger materials in the transportation sector. Cur- rently used light bulbs only convert approximately 5% of the electrical energy into light. [edit] Increasing the efficiency of energy production.Nanotechnology is already impacting the field of consumer goods, providing products with novel functions ranging from easy-to-clean to scratch-resistant. Modern textiles are wrinkle- resistant and stain-repellent; in the mid-term clothes will become “smart”, through embedded “wearable electronics”. Nanotechnology can be applied in the production, processing, safety and packaging of food. A nanocomposite coating process could improve food packaging by placing anti-microbial agents directly on the surface of the coated film. Nanocomposites could increase or decrease gas permeability of different fillers as is needed for different products. They can also improve the mechanical and heat-resistance properties and lower the oxygen transmission rate. Research is being performed to apply nanotechnology to the detection of chemical and biological substances for sensing biochemical changes in foods. Applications of nanotechnology have the potential to change the entire agriculture sector and food industry chain from production to conservation, processing, packaging, transportation, and even waste treatment. Strategic applications of Nano Science can do wonders in the agriculture scenario. NanoScience concepts and Nanotechnology applications have the potential to redesign the production cycle, restructure the processing and conservation processes and redefine the food habits of the people. Nanotechnology in India: Several Indian institutes and firms are already working on nanotechnology products for drug delivery, water filters, arsenic removal, reducing water and air pollution, antimicrobial coatings and river cleaning projects, Sen said, and the country must develop guidelines on nanoparticle toxicity and biosafety. Scientists from the Energy Resources Institute in Delhi launched a study to investigate the opportunities and risks associated with the technology. India launched a programme to promote nanoscience and nanotechnology with a budget of 10 trillion Indian rupees (US$255 million). But although several public and private research institutes are working on DNA chips, carbon nanotubes, nanoparticles such as iron oxide and silver oxide, and Copyright © 2009 | WWW.UPSCPORTAL.COM 136

Section -6 (Model Test Paper) products such as paints and polymers, experts noted a general lack of enthusiasm from Indian industry.There has been no effort to link the technology's potential with development in agriculture and addressing the needs of people in rural areas, who form the backbone of India's economy. For example, nanomaterials could help improve solar cells and biogas reactors. Government’s Initiatives: Nanotechnology is one of the main new developing areas recognized by Indian government in past 5 years and thus there has been a topic of growing interest for companies both domestic and foreign for the various Indian Government policies and incentives to start nanotechnology companies in India. One of the major roadblock to international as well as domestic companies to venture in the nanotechnology field has been a lack of understanding of the government policies in nanotechnology and thus the main objective of this report is to provide the reader a concise and clear idea of the government policies, vital information to widen their scope as well as facilitate their decisions in research or commercial endeavors. It provides an over- view of all the government published documents ranging from the Ministry of Commerce and Union budget to the policies of all major government funded institutions. A report mentioned all foreign collaborations initiated by Indian government amongst Indian and Foreign research organizations as well as industry to accelerate the nanotechnology development in India. The report also included the financial incentives as well as intellectual property protection guidelines for any foreign collaboration. The report principally lends assistance to potential investors and to those who are enthusiastic in gaining insight of nanotechnology development and the direction of nanotechnology research in India for the purpose of possible collaborative research efforts or commercial ventures. Indian scientists have called for the development of regulations on the safe use of nanotechnology in healthcare and the environment. The absence of regulations for nanotechnology in India and worldwide is a serious problem. Ans. 11 (a) Raising prospects for building a practical quantum computer, physicists at the National Institute of Standards and Technology (NIST) have demonstrated sustained, reliable information processing operations on electrically charged atoms (ions). In the new demonstration, NIST researchers repeatedly performed a combined sequence of five quantum logic operations and ten transport operations while reliably maintaining the 0s and 1s of the binary data stored in the ions, which serve as quantum bits (qubits) for a hypothetical quantum computer, and retaining the ability to subsequently manipulate this information. Previously, scientists at NIST and elsewhere have been unable to coax any qubit technology into performing a complete set of quantum logic operations while transporting information, without disturbances degrading the later processes. The NIST group performed some of the earliest experiments on quantum information processing and has previously demonstrated many basic components needed for computing with trapped ions. The new research combines previous advances with two crucial solutions to previously chronic vulnerabilities: cooling of ions after transport so their fragile quantum properties can be used for subsequent logic operations, and storing data values in special states of ions that are resistant to unwanted alterations by stray magnetic fields. Researchers have demonstrated on a small scale all the generally recognized requirements for a large-scale ion- based quantum processor. Previously they could perform all of the following processes a few at a time, but now they can perform all of them together and repeatedly: (1) "initialize" qubits to the desired starting state (0 or 1), (2) store qubit data in ions, (3) perform logic operations on one or two qubits, (4) transfer information between different locations in the processor, and (5) read out qubit results individually (0 or 1). Through its use of ions, the NIST experiment showcases one promising architecture for a quantum computer, a potentially powerful machine that theoretically could solve some problems that are currently intractable, such as Copyright © 2009 | WWW.UPSCPORTAL.COM 137

Section -6 (Model Test Paper) breaking today's most widely used encryption codes. Relying on the unusual rules of the submicroscopic quantum world, qubits can act as 0s and 1s simultaneously, unlike ordinary digital bits, which hold only one value at any given time. Quantum computers also derive their power from the fact that qubits can be "entangled," so their properties are linked, even at a distance. Ions are one of a number of different types of quantum systems under investigation around the world for use as qubits in a quantum computer. There is no general agreement on which system will turn out to be the best. The NIST experiments described in Science Express stored the qubits in two beryllium ions held in a trap with six distinct zones. Electric fields are used to move the ions from one zone to another in the trap, and ultraviolet laser pulses of specific frequencies and duration are used to manipulate the ions' energy states. The scientists demonstrated repeated rounds of a sequence of logic operations (four single-qubit operations and a two-qubit operation) on the ions and found that operational error rates did not increase as they progressed through the series, despite transporting qubits across macroscopic distances (960 micrometers, or almost a millimeter) while carrying out the operations. The other significant innovation was the use of three different pairs of energy states within the beryllium ions to hold information during different processing steps. This allowed information to be held in ion states that were not altered by magnetic field fluctuations during ion storage and transport, eliminating another source of processing errors. Information was transferred to different energy levels in the beryllium ions for performing logic operations or reading out their data values. Ans. 11 (b) Photovoltaic and wind energy plants, hydroelectric power stations and biogas plants supply energy without polluting the environment. However, they are complex to design and maintain. Virtual reality (VR) makes planning and operation easier.The design engineer’s head is spinning. Analyzing data on the computer for hours, with no end in sight is possible. Designing a hydroelectric power station, she would like to know what the pressures, temperatures and fluid flows will be in the facility. She may simulate them with simulation software. However, this only delivers vast columns of numbers or a one-dimensional representation which she will have to analyze bit by bit – a laborious task. This will get easier in the future. Researchers from the Fraunhofer Institute for Factory Operation and Automa- tion IFF in Magdeburg have developed a method that visualizes the processes inside energy conversion plants, e.g. such as photovoltaic, wind, biogas and hydroelectric power stations. To do so, they have coupled 3-D plant engineering and simulation results with a virtual reality (VR) program developed at the IFF. “A special software tool has enabled us to visualize all the motion sequences for the first time ever – at just the push of a button. Arrows that move through the VR model show engineers the direction in which and speed at which fluids and gases flow through a plant. Colored markings indicate potential weak points such as areas where critical temperatures, deposits or erosions could occur. Is there a potential for collisions when the plant components are moving? The virtual insights facilitate engineering and should therefore ensure that plants become more efficient and have lower emissions. Ans. 11 (c) A Supercomputing facility called "Param Sheersh" was inaugurated at the ongoing Indian Science Congress at the North Eastern Hill University,NEHU in Shillong. Prof. MGK Menon, the renowned scientist and the Chan- cellor of the NEHU, inaugurated the new facility that would benefit the students and teachers engaged in various research activities on the campus. Copyright © 2009 | WWW.UPSCPORTAL.COM 138

Section -6 (Model Test Paper) The PARAM Sheersh Computer System is a Supercomputing facility created by C-DAC, funded by Department of Information technology, Ministry of Communications and Information Technology. This High Performance Computing facility aims at conducting research in strategic areas of Weather, Seismic, Bio-informatics, Physics, Computational Fluid Dynamics, Material Sciences, Life Sciences. The facility shall also serve as a core backbone platform for the students, researchers and faculty members of the region to develop competency skills for solv- ing challenging problems requiring massive computational work especially in the areas of Physics, Chemistry, Mathematics, Bio-informatics, Botany, Zoology and Environmental Science. Open source HPC Applications like WRF, MM5, MOM4, ROMS, COSMOS under Climatology, Quantum Espresso, Abhinit under Physics domain, mpiBLAST, ClustalW under Bio-informatics shall be ported on the systems for conducting research. Ans. 11 (d) Ministry of Communication and Information Technology recently launched the tele-medicine application through Common Service Centres (CSC). The integration of CSC services with ‘e-Sanjeevani’, a tele-medicine software package for remote diagnostics and tele-counselling was showcased at New Delhi. The software is targeted to be deployed as a cost effective tele-medicine tool for rural area at 100,000 CSCs being set up as part of the country’s National e-Governance Plan. e-Sanjeevani, a web based software, facilitates creation of Electronic Medical Record (EMR) for variety of diagnostic reports e.g. ECG, pathological reports, radiological examination (X-ray, CT Scan, MRI etc.). The patient record is secured through encryption. A highlight of the tool is that it enables multipoint, multi referral consultation, as well as one-to-one consultation between patient to doctor and doctor to doctor. The programme enables anywhere, anytime access with zero installation cost for the user. The combination of CSCs across the country along with the potential offered by e-Sanjeevani is expected to significantly enhance the outreach of health care to the rural masses. With this initiative a large number of villagers will be able to have their health records in electronic form, accessible anytime from anywhere. Village Level Entrepreneurs(VLEs) with minimum training in handling ECG machines and other devices will be able to handle the medical equipment co-located at CSCs. The e-Sanjeevani , a software package has been developed by the C-DAC, Mohali. C-DAC, Mohali has established a tele-medicine network in Punjab and Haryana linking remote Sanjeevani Health Centres to Referral Facilities. Ans. 12 (a) Stands for "Network Address Translation." NAT translates the IP addresses of computers in a local network to a single IP address. This address is often used by the router that connects the computers to the Internet. The router can be connected to a DSL modem, cable modem, T1 line, or even a dial-up modem. When other computers on the Internet attempt to access computers within the local network, they only see the IP address of the router. This adds an extra level of security, since the router can be configured as a firewall, only allowing authorized systems to access the computers within the network. Ans. 12 (b) Robotic therapy can potentially help reduce impairment and facilitate neuro-development of youngsters with cerebral palsy. Krebs and others at MIT, including professor of mechanical engineering Neville Hogan, pio- neered the use of robotic therapy in the late 1980s, and since then the field has taken off. The MIT team is focusing on improving cerebral palsy patients' ability to reach for and grasp objects. Copyright © 2009 | WWW.UPSCPORTAL.COM 139

Section -6 (Model Test Paper) Ans. 12 (c) Scientists at the University of Missouri have developed the ability to take regular cells from a pig's connective tissues, known as fibroblasts, and transform them into stem cells, eliminating several of these hurdles. Since these "induced pluripotent stem cells" were not derived from embryos and no cloning technique was used to obtain them, the approach eliminates some of the controversy that has accompanied stem cell research in the past. Ans. 12 (d) A compression/decompression utility that lets Windows users make their files smaller for faster transfer over the Internet. This utility also decompresses files that were originally compressed using PKZIP or other formats. Ans. 12 (e) The 2009 flu pandemic is a global outbreak of a new strain of influenza virus, officially named the "new H1N1", first identified in April 2009, and commonly called "Swine flu." It is thought to be a mutation of four known strains of the influenza A virus, subtype H1N1: one endemic in (normally infecting) humans, one endemic in birds, and two endemic in pigs (swine). The outbreak began in Mexico, with evidence that Mexico was already in the midst of an epidemic for months before the outbreak was recognized. The virus has since spread to the Southern Hemisphere which entered its winter flu season, and to many less developed countries with limited healthcare systems. Copyright © 2009 | WWW.UPSCPORTAL.COM 140

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Aspirants Times Magazine Vol5 - August 2009

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