Daily Current Affairs for 13th July 2021

GS PAPER II

Right to repair movement

Why in News

Recently, the US President signed an executive order calling on the Federal Trade Commission to curb restrictions imposed by manufacturers that limit consumers’ ability to repair their gadgets on their own terms.

Key Points

• The UK also introduced right-to-repair rules that should make it much easier to buy and repair daily-use gadgets such as TVs and washing machines.

Right to Repair Movement

• Activists and organizations around the world have been advocating for the right of consumers to be able to repair their own electronics and other products as part of the ‘right to repair’ movement.
• The movement traces its roots back to the very dawn of the computer era in the 1950s.
• The goal of the movement is to get companies to make spare parts, tools and information on how to repair devices available to customers and repair shops to increase the lifespan of products and to keep them from ending up in landfills.
• These electronic manufacturers are encouraging a culture of ‘planned obsolescence’ which means that devices are designed specifically to last a limited amount of time and to be replaced.
• Manufacturing an electronic device is a highly polluting process. It makes use of polluting sources of energy, such as fossil fuel, which has an adverse impact on the environment.
• For example, a New York Times report states that the mining and manufacturing materials used to make an iPhone “represent roughly 83 per cent of its contribution to the heat-trapping emissions in the atmosphere throughout its life cycle”. It’s about 57 per cent for the average washing machine.
• Right to repair will help boost business for small repair shops, which are an important part of local economies. If a manufacturer has monopoly on repairs, then prices rise exponentially and quality tends to drop.
• Price is a major factor. As there is a lack of competition in the repair market in the west, consumers are not able to hunt for the best deal.

Right to repair in the United States

• To promote economic competition, the US President called on the Federal Trade Commission to force tech companies to allow consumers to fix their own electronic devices, either themselves or using a technician of their choice.
• He specifically called out cell phone and tractor manufacturers in the White House’s fact sheet.
• With this, some believe manufacturers of electronic devices may even start making their products more durable and long lasting.
• As of 2021, almost all of the 50 US states have proposed a right to repair bill, however, only one, Massachusetts, has made it a law.
• The state’s legislation makes it compulsory for vehicle manufacturers to make information about repairs to owners and independent repair facilities for any car made in 2015 or later. Since then, most car manufacturers have applied this rule across the US, even though the law is limited to Massachusetts alone.
• The law and future amendments to it, which could expand access to mechanical and electronic repair data, have been challenged by the Alliance for Automotive Innovation, which represents General Motors, Fiat Chrysler and other car makers. They argue that opening up data could lead to serious cyber security risks.
• The focus of the proposed right to repair bills in other US states vary greatly. Since the 2021 legislative session has been completed in nearly all the states, the proposed bills will not become law this year.

Right to repair in Europe

• The UK government introduced right-to-repair rules with the aim of extending the lifespan of products by up to 10 years.
• Manufacturers of products like washing machines, TVs and refrigerators are required to make spare parts available to people purchasing electrical appliances.
• The new legislation gives manufacturers a two-year window to make the necessary changes to abide by the new legislation.
• However, it does not cover all electrical appliances. Meanwhile, the European Union’s right to repair laws requires manufacturers to ensure that electronic goods can be repaired for up to a decade.
• The aim is to reduce electrical waste, which has been on the rise in the continent due to a spike in manufacturing.

GS PAPER III

Consumer Price Index

Why in News

Recently, the National Statistical Office (NSO) released All India Consumer Price Index (CPI) on Base 2012=100 and corresponding Consumer Food Price Index (CFPI) for Rural (R), Urban (U) and Combined (C) for the month of June 2021 (Provisional) for Sub-Groups and Groups for both All India and all States/UTs.

Key Points

• 
• The Price data are collected from representative and selected 1114 urban Markets and 1181 villages covering all States/UTs through personal visits by field staff of Field Operations Division of NSO, MoSPI on a weekly roster.
• During the month of June 2021, NSO collected prices from 99.6% villages and 98.6% urban Markets while the Market-wise prices reported therein were 78.7% for rural and 82.0% for urban.

Highlights of the Report

• The retail inflation of country, measured by the Consumer Price Index (CPI), eased marginally to 6.26 per cent in the month of June.
• Separately, India’s factory output, measured in terms of the Index of Industrial Production (IIP), witnessed a year-on-year growth of 29.3 per cent in May.
• The retail inflation during the month of May was at 6.30 per cent. This is the second successive time that the CPI data has come over the Reserve Bank of India’s (RBI) upper margin of 6 per cent. Prior to this, the CPI came below the 6 per cent mark for five consecutive months.
• The government has asked the central bank to maintain retail inflation at 4 per cent with a margin of 2 per cent on either side for a five-year period ending March 2026.
• The Consumer Food Price Index (CFPI) or the inflation in the food basket inched slightly higher on-month during June to 5.15 per cent, from 5.01 per cent in May.
• The hike in the food basket was mainly due to a sharp rise in prices of oils and fats which surged 34.78 per cent on year in June.
• Apart from food and beverages, the fuel and light segment rose 12.68 per cent in June, while clothing and footwear gained 6.21 per cent and the housing segment inched up 3.75 per cent.

Consumer Price Index (CPI)

• The Consumer Price Index (CPI) is a scale that measures the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care.
• It is calculated by taking price changes for each item in the predetermined basket of goods and averaging them.
• Changes in the CPI are used to assess price changes associated with the cost of living.
• The CPI is one of the most frequently used statistics for identifying periods of inflation or deflation.
• It may be compared with the producer price index (PPI), which instead of considering prices paid by consumers looks at what businesses pay for inputs.

Inflation

• Inflation is the decline of purchasing power of a given currency over time.
• A quantitative estimate of the rate at which the decline in purchasing power occurs can be reflected in the increase of an average price level of a basket of selected goods and services in an economy over some period of time.
• The rise in the general level of prices, often expressed as a percentage, means that a unit of currency effectively buys less than it did in prior periods.
• Inflation is sometimes classified into three types:
• Demand-Pull inflation,
• Cost-Push inflation, and
• Built-In inflation.
• The most commonly used inflation indexes are the Consumer Price Index (CPI) and the Wholesale Price Index (WPI).
• Inflation can be viewed positively or negatively depending on the individual viewpoint and rate of change.

GS PAPER III

Blue Economy

Why in News

According to the Ministry of State Science & Technology; Ministry of State Earth Sciences; Ministry of State PMO, Personnel, Public Grievances, Pensions, Atomic Energy and Space stated that in the upcoming years, India is aiming to target over 100 billion “Blue Economy” through its Deep Ocean Mission (DOM) and ocean resources.

Key Points

• The Ministry of Earth Sciences reiterated the importance of exploring the ocean to give further fillip to the growth of country’s economy.
• This project could be a new avenue to supplement the country’s economy to the tune of an estimated Rs. 110 billion.
• “Deep Ocean Mission” planned by the Ministry of Earth Sciences will be carried out in collaboration with Indian Space Research Organisation (ISRO).
• It will be a major step in the direction of integrating and bringing together the efforts of the different streams of science operating under different Ministries in the government.
• The “Deep Ocean Mission” will also have far-reaching benefits for the common man. For example, it could help in providing clean drinking water and explore the avenues of desalination of water as well as extracting minerals from the ocean belt.

Deep Ocean Mission

• It is a mission mode project to support the Blue Economy Initiatives of the Government of India.
• Ministry of Earth Sciences (MoES) will be the nodal Ministry implementing this multi-institutional ambitious mission.
• The Deep Ocean Mission consists of the following six major components:
• Development of Technologies for Deep Sea Mining, and Manned Submersible:
• A manned submersible will be developed to carry three people to a depth of 6000 metres in the ocean with suite of scientific sensors and tools.
• An Integrated Mining System will be also developed for mining Polymetallic Nodules from 6000 m depth in the central Indian Ocean.
• This component will help the Blue Economy priority area of exploring and harnessing of deep-sea minerals and energy.
• Development of Ocean Climate Change Advisory Services:
• A suite of observations and models will be developed to understand and provide future projections of important climate variables on seasonal to decadal time scales under this proof-of-concept component.
• This component will support the Blue Economy priority area of coastal tourism.
• Technological innovations for exploration and conservation of deep-sea biodiversity:
• Bio-prospecting of deep-sea flora and fauna including microbes and studies on sustainable utilization of deep-sea bio-resources will be the main focus.
• This component will support the Blue Economy priority area of Marine Fisheries and allied services.
• Deep Ocean Survey and Exploration:
• The primary objective of this component is to explore and identify potential sites of multi-metal Hydrothermal Sulphides mineralization along the Indian Ocean mid-oceanic ridges.
• This component will additionally support the Blue Economy priority area of deep-sea exploration of ocean resources.
• Energy and freshwater from the Ocean:
• Studies and detailed engineering design for offshore Ocean Thermal Energy Conversion (OTEC) powered desalination plant are envisaged in this proof-of-concept proposal.
• This component will support the Blue Economy priority area of off-shore energy development.
• Advanced Marine Station for Ocean Biology:
• This component is aimed as development of human capacity and enterprise in ocean biology and engineering.
• This component will translate research into industrial application and product development through on-site business incubator facilities.
• This component will support the Blue Economy priority area of Marine Biology, Blue trade and blue manufacturing.
• The estimated cost of the Mission will be Rs. 4077 crores for a period of 5 years to be implemented in a phase-wise manner.

Significance of Deep Ocean Mission

• The Mission will help India to explore and mine strategic polymetallic nodules such as Copper, Nickel, Cobalt and Manganese.
• The main features of the Mission include conducting mineral study 6000 meters deep in the sea, deep-sea survey, research on climate change variables and its impact, and study of marine biodiversity.

Blue Economy

• The ‘Blue Economy’ is an emerging concept which encourages better stewardship of ocean or ‘blue’ resources.
• It underpins the thinking behind the Commonwealth Blue Charter, highlighting in particular the close linkages between the ocean, climate change, and the wellbeing of the people of the Commonwealth.
• It supports all of the United Nations’ Sustainable Development Goals (SDGs), especially SDG14 ‘life below water’, and recognises that this will require ambitious, co-ordinated actions to sustainably manage, protect and preserve ocean, for the sake of present and future generations.
• Similar to the ‘Green Economy’, the blue economy model aims for improvement of human wellbeing and social equity, while significantly reducing environmental risks and ecological scarcities.
• It provides for an inclusive model in which coastal states, which sometimes lack the capacity to manage their rich ocean resources, can begin to extend the benefit of those resources to all.
• Realising the full potential of the blue economy means inclusion and participation of all affected social groups and sectors.

Facts about Blue Economy

• The worldwide ocean economy is valued at around valued at around US$1.5 trillion per year.
• 80% of global trade by volume is carried by sea and 350 million jobs world-wide are linked to fisheries.
• By 2025 it is estimated that 34% of crude oil production will come from offshore fields.
• Aquaculture is the fastest growing food sector and provides about 50% of fish for human consumption.

GS PAPER III

Wildfires

Why in News

The western United States and Canada was suffering under scorching temperatures to start the week.

Key Points

• Sweltering conditions hit much of the Pacific seaboard and as far inland as the western edge of the Rocky Mountains, in dramatic, prolonged heat wave experts attribute directly to climate change.
• The U.S. National Weather Service (NWS) had warned the dangerous temperatures will continue in the region for the early part of the week, forecasting highs of up to 115 degrees Fahrenheit (46 Celsius) in southern California, and issued a heat advisory for the Los Angeles area.
• The NWS stated that the temperatures would dip slightly. This small relative cool down is of little relief to areas that have seen long-term oppressive and above normal temperatures.

Wildfire

• A wildfire, bushfire, wild land fire or rural fire is an unplanned, unwanted, uncontrolled fire in an area of combustible vegetation starting in rural areas and urban areas.
• Depending on the type of vegetation present, a wildfire can also be classified as a forest fire, brush fire, bushfire (in Australia), desert fire, grass fire, hill fire, peat fire, prairie fire, vegetation fire, or veld fire.
• Many organizations consider wildfire as an unplanned and unwanted fire, while wild land-fire is a broader term that includes prescribed fire as well as wildland fire use.

Heat Wave

• A heat wave is a period of unusually hot weather that lasts for more than two days.
• National Weather Service (NWS) notes that heat waves can occur with or without high humidity and have the potential to cover a large area, “exposing a high number of people to hazardous heat.”

Heat Dome

• According to National Oceanic and Atmospheric Administration (NOAA) of US department of commerce, a heat dome occurs when the atmosphere traps hot ocean air like a lid or cap.
• The phenomenon begins when there is a strong change (or gradient) in ocean temperatures.
• In the process known as convection, the gradient causes more warm air, heated by the ocean surface, to rise over the ocean surface.
• As prevailing winds move the hot air east, the northern shifts of the jet stream trap the air and move it toward land, where it sinks, resulting in heat waves.

Effect of heat domes

• Those who living without an air conditioner see the temperatures of their homes rising to unbearably high, leading to sudden fatalities like those which are being reported in Canada and parts of the US.
• The trapping of heat can also damage crops, dry out vegetation and result in droughts.
• The sweltering heat wave will also lead to rise in energy demand, especially electricity, leading to pushing up rates.
• The heat domes can also act as fuel to wildfires, which destroy a lot of land area in the US every year.
• In decades to come, the climate scientists expect more days of severe heat wave.

GS PAPER III

Liquidity buffer

Why in News

According to the Crisil Ratings, higher liquidity cover at NBFCs enabled them to service debt in the near term, and cushioned the impact of lower collections during the second wave of COVID­19.

Key Points

• The change in liquidity cover at NBFCs from last year, when asset quality and liquidity fears multiplied after a moratorium on repayments and stringent lockdowns affected collections.
• This time around, the build-up in liquidity has been a crucial off-set.
• The collections had again been affected in the current fiscal by the second wave. In the wake of the second wave, Crisil conducted the study considering two stress case scenarios.
• In the first scenario, in view of the collection challenges in the first quarter of FY22, it assumed collections over the next quarter at 70% of the levels in the past couple of quarters.
• In the second scenario, collections were assumed to halve.
• In scenario 1, 96% of NBFCs were found to have liquidity cover for three months’ worth of debt repayments and in scenario 2, the number was only marginally lower at 95%.
• Based on scenario 1, only 4% of NBFCs had low cover (less than one time), compared with 8% in June 2020, and 23% in April 2020.
• It pointed out that a number of NBFCs had increased provisioning levels in the past two fiscal years, and had thus enhanced buffers for asset­side risks.

Non-Banking Financial Company (NBFC)

• A Non-Banking Financial Company (NBFC) is a company registered under the Companies Act, 1956 engaged in the business of loans and advances, acquisition of shares or, stocks or, bonds or, debentures or, securities issued by Government or local authority or other marketable securities of a like nature, leasing, hire-purchase, insurance business, chit business.
• It does not include any institution whose principal business is that of agriculture activity, industrial activity, purchase or sale of any goods or providing any services and sale/purchase/construction of immovable property.
• A non-banking institution is a company that has principal business of receiving deposits under any scheme or arrangement in one lump sum or in instalments by way of contributions or in any other manner, is also a non-banking financial company.