Daily Current Affairs for UPSC IAS: 12th February 2022

Monetary Policy:

The Reserve Bank of India maintained status quo in policy rates as the Monetary Policy Committee (MPC) voted unanimously to keep the policy repo rate at 4% to keep the stance accommodative.

• While announcing the Bi-monthly policy RBI Governor Shaktikant Das said, MSF rate and bank rate will remain unchanged at 4.25%.
• Reverse repo rate will also remain unchanged at 3.35%.
• MPC has voted 5-1 to continue accommodative monetary policy stance as long as necessary to revive and sustain growth and mitigate impact of #COVID19 on the economy, while ensuring inflation remains within target.
• He projected real GDP growth at 9.2% for 2021-22 and said that it is modestly above level of GDP for 2019-20. Real GDP growth for 2022-23 was projected at 7.8%.
• He announced that Variable Rate Repo operations of varying tenures will henceforth be conducted as and when warranted.
• Variable rate repos and variable rate reverse repos of 14-day tenures will operate as the main liquidity management tool.
• He informed that from March 1, 2022, fixed rate reverse repo and MSF operations will be available only during 5.30 PM to 11.59 PM on all days, instead of from 9.00 AM to 11.59 PM.
• He also announced some additional measures like extension of On-tap Liquidity Facilities for Emergency Health Services and Contact-intensive Sectors, voluntary retention route (VRR) – Enhancement of Limits, Review of Credit Default Swaps (CDS) Guidelines, Permission for Banks to deal in Foreign Currency Settled – Rupee Derivatives Market etc.

Belarus:

Russia rolled its tanks across Belarus for live-fire drills that drew an ominous warning from NATO and added urgency to Western efforts to avert a feared invasion of Ukraine.

• The war games — set to run until February 20 — followed a gradual Russian military build-up around Ukraine that some U.S. estimates say has reached 1,30,000 soldiers grouped in dozens of combat brigades.
• Western leaders have been shuttling to Moscow in an effort to keep the lines of communication open, giving Russia a chance to air its grievances about NATO’s expansion into eastern Europe and ex-Soviet states.
• Russia has also sent six warship through the Bosphorus for naval drills on the Black Sea and the neighbouring Sea of Azov.
• Belarus is a landlocked country in Eastern Europe.
• It is bordered by Russia to the east and northeast, Ukraine to the south, Poland to the west, and Lithuania and Latvia to the northwest.
• Minsk is the capital and largest city.

Liquidity Window For Healthcare:

The Reserve Bank of India (RBI) proposed to extend the term-liquidity facility of ₹50,000 crore offered to emergency health services by three months till June 30.

• Last year in May, RBI had announced an on-tap liquidity window of ₹50,000 crore, at the repo rate with tenors of up to three years, to boost provision of immediate liquidity for ramping up COVID-19-related healthcare infrastructure and services in the country.
• Banks were incentivised for quick delivery of credit under the scheme through extension of priority-sector classification to such lending up to March 31, 2022.
• In view of the response to the scheme, it is now proposed to extend this window up to June 30, 2022 from March 31, 2022 as announced earlier.
• Under the scheme, banks were expected to create a COVID-19 loan book.

What Is ‘tulip mania’?

A week after budget 2022-23 proposed 30 per cent tax on gains made from cryptocurrency trades, Reserve Bank of India (RBI) governor Shaktikanta Das termed it as a “threat to macroeconomic and financial stability”.

Tulip mania was a period when tulips were recently introduced and bought in large quantities by many people. This caused tulip prices to shoot up. They were sold at prices higher than skilled workers’ income. After reaching a peak, tulip prices crashed, leaving tulip holders bankrupt. It was the first major economic bubble.

• Announcing the bi-monthly monetary policy outcome, Das cautioned investors by invoking the 17th century ‘tulip mania’ — which is widely considered to be the first financial bubble.
• The RBI governor said that investors must remember that cryptocurrencies have no underlying, not even a tulip.
• The central bank has always maintained a strong stance against private digital currencies. It had banned the banking system from aiding such trades, which was struck down by the Supreme Court in 2020.
• Cryptocurrencies are said to originate or ‘mined’ using complex algorithms built on the blockchain platform but critics say it lacks the ‘value’ of legal tender whose supply is regulated.
• The ‘tulip mania’ of the 17th century is often cited as a classic example of a financial bubble where the price of something goes up, not due to its intrinsic value but because of speculators wanting to make a profit by selling a bulb of the exotic flower.
• It is also known as the Dutch tulip market bubble and occurred in Holland during early to mid 1600s. It was one of the most famous market bubbles and crashes of all times.
• Speculations drove up the value of tulip bulbs and they traded for an extensively higher price.
• In today’s context, it serves as a parable for the pitfalls that excessive speculation can lead to.

Sri Madhvacharya:

The Prime Minister, Shri Narendra Modi paid his obeisances to Sri Madhvacharya on the occasion of Madhva Navami.

• Madhvacharya (CE 1199-1278 or CE 1238–1317) was also known as Purna Prajna and Ānanda Tīrtha.
• He was a Hindu philosopher and the chief proponent of the Dvaita (dualism) school of Vedanta.
• Madhva called his philosophy Tattvavāda meaning “arguments from a realist viewpoint”.
• His greatest work is considered to be the Anuvyakhyana, a philosophical supplement to his bhasya on the Brahma Sutras composed with a poetic structure.
• Madhvacharya was a critic of Adi Shankara’s Advaita Vedanta and Ramanuja’s Vishishtadvaita Vedanta teachings.
• Madhva established the Krishna Mutt at Udupi with a murti secured from Dwarka Gujarat in CE 1285.

What Is Chintamani Natakam?

Earlier this year, the Andhra Pradesh government banned a 100-year-old play named ‘Chintamani Padya Natakam’

• Chintamani Padya Natakam’ was written in 1920 by playwright Kallakuri Narayana Rao, who was also a social reformer.
• The play is about Chintamani, a courtesan and a devotee of Lord Krishna, who finds salvation by singing bhajans.
• She is courted by Subbi Shetty, a businessman from the Arya Vysya community, who loses his wealth and family due to his attraction to Chintamani.
• The original play had a social message, but over the years, it has been modified purely for entertainment.
• Much of the play sees central character Subbi Shetty made fun of, especially for losing all his wealth to his vices.
• The Arya Vysya community has been petitioning governments for several years to ban the play, saying it portrays them in a negative light.
• The play is exhibited across the state, mainly in rural areas, during festivals and fairs.
• After reviewing the contents of the play, the state government had banned it on January 17 this year.

One Ocean Summit:

Prime Minister Narendra Modi will address the high-level segment of One Ocean Summit on Feb 11, 2022 through a video message.

• The Summit will also be addressed by several Heads of States and Governments including Germany, United Kingdom, South Korea, Japan and Canada among others.
• One Ocean Summit is being organised by France from 9th to 11th February in Brest, in cooperation with the United Nations and the World Bank.
• The objective of the Summit is to mobilise the international community to take tangible action towards preserving and supporting healthy and sustainable ocean ecosystems.

Privilege Motion:

Four Telangana Rashtra Samithi (TRS) members in the Rajya Sabha have submitted a Privilege Motion against Prime Minister Narendra Modi regarding his February 8 remarks in the Upper House about the Andhra Pradesh Reorganisation Bill.

• Prime minister during his Motion of Thanks to the President’s address, had questioned the parliamentary process adopted for the bifurcation of Andhra Pradesh into the States of Telangana and Andhra in 2014, adding that doors were shut, pepper sprays were used and mikes were switched off to pass the legislation.
• Modi’s statement attempts to show the Parliament Houses in the most bad and contemptuous manner, denigrating and demeaning the procedures and proceedings of the House and its functioning.
• It amounted to finding fault with the Members of Parliament and the Presiding Officers for their conduct in the house.
• Even the decision of the Presiding Officer, to close the doors of the House to prevent the spread of disorder or mischief of a handful few Members, is brought under question.
• This amounts to a contempt of the House, raising the issue of its Privilege.
• Parliamentary Privileges are certain rights and immunities enjoyed by members of Parliament, individually and collectively, so that they can “effectively discharge their functions”.
• Article 105 of the Constitution expressly mentions two privileges, that is, freedom of speech in Parliament and right of publication of its proceedings.
• Apart from the privileges as specified in the Constitution, the Code of Civil Procedure, 1908, provides for freedom from arrest and detention of members under civil process during the continuance of the meeting of the House or of a committee thereof and forty days before its commencement and forty days after its conclusion.
• Motion against breaches: When any of these rights and immunities are disregarded, the offence is called a breach of privilege and is punishable under law of Parliament.
• A notice is moved in the form of a motion by any member of either House against those being held guilty of breach of privilege.

ASEAN:

India is in discussion with the 10-nation bloc ASEAN for initiating the review of the FTA (free-trade agreement) in goods between the two regions to seek more market access for domestic products.

• Free Trade Agreement (FTA) is a pact between two or more nations to reduce barriers to imports and exports among them.
• Under a free trade policy, goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies, or prohibitions to inhibit their exchange.
• The concept of free trade is the opposite of trade protectionism or economic isolationism.
• The Association of Southeast Asian Nations is a regional organization which was established to promote political and social stability amid rising tensions among the Asia-Pacific’s post-colonial states.
• The motto of ASEAN is “One Vision, One Identity, One Community”.
• ASEAN Secretariat – Indonesia, Jakarta.
• Established in 1967 with the signing of the ASEAN Declaration (Bangkok Declaration) by its founding fathers.
• Founding Fathers of ASEAN are: Indonesia, Malaysia, Philippines, Singapore and Thailand.
• Ten Members: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam.
• Against the backdrop of aggressive moves by China, including the Ladakh standoff, India placed the ASEAN at the centre of India’s Act East policy and held that a cohesive and responsive ASEAN is essential for security and growth for all in the region.
• ASEAN is necessary for the success of the Security And Growth for All in the Region (SAGAR) Vision.
• The region is significant for diversification and resilience of supply chains for post-Covid-19 economic recovery.
• It is India’s 4th largest trading partner with about USD 86.9 billion in trade.

US Relations With Indo-Pacific:

The United States has said that it remains focused long-term on the Indo-Pacific region despite concerns over Russian aggression toward Ukraine.

• This highlights the importance of the region and the role that India has to play with regard to ensuring security of the region.
• The idea of the Indo-Pacific as a single strategic space is an outgrowth of China’s growing influence in the Indian Ocean region.
• It signifies the interconnectedness of the Indian and Pacific Oceans, the importance of the oceans to security and commerce.
• The Indo-Pacific is the fastest growing region in the world, accounting for two-thirds of global economic growth over the past five years and home to half the world’s population.
• Peace here is important in Maintaining regional stability.
• China’s increasingly active presence in the Indian Ocean region as well as its efforts to expand geopolitical reach in Asia and beyond by the use of trade and military are posing challenges in the region.
• Hence, coordination among Quad countries is necessary.
• For adhering to freedom of navigation, adherence to rules-based order and stable trade environment, peace in Indo Pacific region is important.
• For free sea and air lanes, connectivity and upholding international rules and norms.
• The Indo-Pacific, as described in the National security strategy, represents the most populous and economically dynamic part of the world and stretches from the west coast of India to the western shores of the United States.
• India has always been a country with great national ambitions and is one of the most important advocates of the concept of “Indo-Pacific Strategy”.
• With opening of economy, India has been connecting with its Indian Ocean neighbours and major maritime powers of the world.