Centre to set inflation targets for RBI
The Centre has given the go-ahead for a major overhaul of the current monetary policy framework wherein the Centre will specify ‘inflation targets’ for the Reserve Bank of India (RBI) to achieve.
Under the proposed new regime, the RBI will set inflation as its top priority in its policy statements.
An expert committee of the RBI, appointed to examine monetary policy, headed by Reserve Bank Deputy Governor Urjit R. Patel, had recommended that the monetary policy decision-making should be vested with a monetary policy committee, chaired by the RBI Governor. But this new decision of the centre departs from the recommendation made.
Inflation targeting is a monetary policy strategy used by central banks for maintaining inflation at a certain level or within a specific range. In general, central banks normally follow a policy of keeping inflation sufficiently low. However, in inflation targeting, there is a preset, publicly declared target. Using methods such as interest rate changes, the central bank and other monetary authorities are expected to guide inflation to a targeted level or range.
The committee, headed by Urjit Patel, was constituted with the aim of making Monetary policy framework transparent and predictable.
The key recommendations, related to inflation, made by the committee are ass follows,
- CPI (combined) should be used as the nominal anchor for a flexible inflation targeting framework.
- Target range of inflation should be 4% with a tolerance band of 2% to be achieved in a 2 year time frame.
- The transition path to the targeted range should be graduated to bring down inflation from the current level of around 10% to 8% over a period not exceeding 12 months and to 6% over a period not exceeding 24 months.
- Administered prices and interest rates should be eliminated as they as impediments to monetary policy transmission and achievement to price stability.
- The committee also suggested to use CPI headline inflation instead of core inflation.
Sources: The Hindu, Economic survey.
Huge response to crowd sourcing
Andhra Pradesh government, for the first time, is using space technology with the help of ISRO and NRSC in disaster management.
Responding to tech-savvy Andhra Pradesh Chief Minister’s appeal, people from cyclone-hit areas have uploaded over 3,000 photos for crowd sourcing on NRSC website using an android app which allows mapping of neighbourhood in an easy manner.
Besides seeking the help of National Remote Sensing Centre, the Disaster Management Department of AP government created a Facebook page. NRSC was directed to use GIS, GPS and remote sensing technologies to spot the damage and put them on the satellite through geo-tagging. This would enable the government to have data on damages on the map.
What is Crowdsourcing?
Crowdsourcing is the process of obtaining needed services, ideas, or content by soliciting contributions from a large group of people, and especially from an online community, rather than from traditional employees or suppliers.
The process of crowdsourcing is often used to subdivide tedious work and to obtain real time information.
Sources: The Hindu, Wiki.
Green-rated buildings not keeping their promise, says CSE report
Green-rated buildings are falling below the minimum benchmarks of their official star rating by the Bureau of Energy Efficiency (BEE), says a report — “Building sense beyond the green façade of sustainable habitat” — by the Centre for Science and Environment released recently.
Data put out by the Indian Green Building Council (IGBC) on energy consumption of large commercial buildings that were rated and awarded silver, gold and platinum ratings, under the Leadership in Energy and Environmental Design (LEED) green-rating programme, show they are grossly underperforming.
India started to mirror the global trends in green rating when the United States Green Building Council (USGBC) began rating buildings in India.
In 2007, LEED India (Leadership in Energy and environmental Design-India) was adapted from the USGBC LEED programme. This is a private initiative run by the IGBC.
India adopted the Green-rated Integrated Habitat Assessment (GRIHA) as the national rating system for buildings in 2007.
GRIHA is a rating tool that helps people assesses the performance of their building against certain nationally acceptable benchmarks. It evaluates the environmental performance of a building holistically over its entire life cycle, thereby providing a definitive standard for what constitutes a ‘green building’. The rating system, based on accepted energy and environmental principles, will seek to strike a balance between the established practices and emerging concepts, both national and international.
GRIHA attempts to minimize a building’s resource consumption, waste generation, and overall ecological impact to within certain nationally acceptable limits / benchmarks. It attempts to quantify aspects such as energy consumption, waste generation, renewable energy adoption, etc. so as to manage, control and reduce the same to the best possible extent.
With over two decades of experience on green and energy efficient buildings, TERI has developed GRIHA (Green Rating for Integrated Habitat Assessment), which was adopted as the national rating system for green buildings by the Government of India in 2007.
This tool has been adopted by the Ministry of New and Renewable Energy. This tool, by its qualitative and quantitative assessment criteria, is able to ‘rate’ a building on the degree of its ‘greenness’.
The basic features of GRIHA:
The system has been developed to help ‘design and evaluate’ new buildings (buildings that are still at the inception stages). A building is assessed based on its predicted performance over its entire life cycle – inception through operation. The stages of the life cycle that have been identified for evaluation are:
- Pre-construction stage: (intra- and inter-site issues like proximity to public transport, type of soil, kind of land, where the property is located, the flora and fauna on the land before construction activity starts, the natural landscape and land features).
- Building planning and construction stages: (issues of resource conservation and reduction in resource demand, resource utilization efficiency, resource recovery and reuse, and provisions for occupant health and well-being). The prime resources that are considered in this section are land, water, energy, air, and green cover.
- Building operation and maintenance stage: (issues of operation and maintenance of building systems and processes, monitoring and recording of energy consumption, and occupant health and well-being, and also issues that affect the global and local environment).
On a broader scale, this system, along with the activities and processes that lead up to it, will benefit the community at large with the improvement in the environment by reducing GHG (greenhouse gas) emissions, reducing energy consumption and the stress on natural resources.
Some of the benefits of a green design to a building owner, user, and the society as a whole are as follows:
- Reduced energy consumption without sacrificing the comfort levels
- Reduced destruction of natural areas, habitats, and biodiversity, and reduced soil loss from erosion etc.
- Reduced air and water pollution (with direct health benefits)
- Reduced water consumption
- Limited waste generation due to recycling and reuse
- Reduced pollution loads
- Increased user productivity
- Enhanced image and marketability
For further reference: http://www.asci.org.in/eeibe/Resources/Presentations/Mr.%20Siva%20Kishan.pdf.
Sources: The Hindu, http://www.grihaindia.org.
TFA implementation problem a ‘shame’
World Bank President Jim Yong Kim has described the world’s inability to get across the finish line with the Trade Facilitation Agreement (TFA) as “really, really a shame,” adding that the market would “punish those who are putting their heads in the sand.”
Trade Facilitation was one of the important elements of the outcome from the Bali ministerial conference.
The Trade Facilitation Agreement forms part of the Bali Package agreed by members at the Ninth Ministerial Conference in Bali.
The Trade Facilitation Agreement contains provisions for faster and more efficient customs procedures through effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues. It also contains provisions for technical assistance and capacity building in this area.
It is a trade protocol aiming to give a spur and do away with the stumbling blocks in doing international trade between various countries. The deadline to sign the agreement is July 31 and the deal has to come into force fully by 2015.
It is being believed, especially by the proponents of the agreement that deal could add $1 trillion to global GDP and also can generate 21 million jobs by slashing red tape and streamlining customs.
India and FTA:
India fears that agreeing to the trade facilitation agreement (TFA) could compromise its own food security.
The problem with TFA runs in a clause that says farm subsidies cannot be more than 10% of the value of agricultural production. If the cap is breached, other members can challenge it and also go on to impose trade sanctions on the country.
The developing countries have a problem with the solutions offered by the developed countries as without the subsidies the food security of the developing nations could be seriously harmed. India agreed to the TFA in Bali only under the condition that interim relief would be provided to the developing nations. It said no legal actions or sanctions would be imposed on the developing nations till 2017, by which time a solution would be worked out among the nations. However, this interim relief would not be applicable if such subsidies would lead to trade distortions, by which one means, that prices of exports and imports cannot be affected by this.
India’s Food Security Act, which is binding on the government by law now, implies that the government will provide very cheap food to the most vulnerable part of the population at low prices. Apart from providing subsidies to the consumers, through the public distribution system, it also provides subsidies to the producers of food grains. So it buys food grains from farmers at a minimum support price, and subsidises inputs like electricity and fertiliser.
Concerns expressed by India:
- The 10% cap on subsidies which will not be possible for India to achieve. And the 10% cap is calculated based on 1986-88 prices when the prices of food grains were much lower. So the cap has to be updated taking into account the present prices of foodgrains.
- India will have to open up its own stockpiling to international monitoring, even for providing subsidised food.
- The United States has been providing farm subsidies to its farmers to the tune of more than $20 billion per year which seems unfair to the developing countries to not crack down on that issue.
India which is home to about 25% of the world’s hungry, feels that it is a Government’s responsibility and duty to ensure availability of proper food to its people.