[Mission 2023] INSIGHTS DAILY CURRENT AFFAIRS + PIB SUMMARY 2 January 2023

GS Paper 3

Syllabus: Indian Economy and related issues

Source: IE

 Direction: The article highlights the reasons behind the depreciation of the Indian Rupee and presents an outlook for 2023.

Context: The Indian rupee depreciated by around 10% against the US dollar in 2022.

The performance of the Indian rupee in 2022:

Worst-performing Asian currency in 2022:

• It witnessed a fall of around 10% against the US dollar, falling to a lifetime low of 83.2 the dollar.
• Compared to the rupee, the Chinese Yuan, Philippine Peso and Indonesian Rupiah fell by around 9% and the South Korean Won and Malaysian Ringgit declined by nearly 7 and 6%, respectively.

Reason for this decline in India:

• The US Fed aggressively raised interest rates (by 425 basis points (bps) in 2022) in its fight against inflation, leading to a higher interest rate differential between the US and India
• As a result, investors pulled out money from the domestic market and started investing in the US market to take advantage of higher rates.
• For example, foreign portfolio investors (FPIs) pulled out Rs 1.34 lakh crore from the Indian markets in 2022, putting pressure on the rupee.
• The Russian invasion of Ukraine accentuated the FPI withdrawals with the global economic slowdown making inflows tougher.

Steps taken to arrest this decline:

• The Reserve Bank of India (RBI) heavily intervened in the foreign exchange (forex) market to defend the rupee.
• As a result, the country’s forex reserves have fallen by $70 billion ($562.81 billion as of December 23, 2022) since the beginning of 2022.
• However, the central bank is now starting to again build up its reserves and that would act as a buffer in times of uncertainty.

The outlook on the rupee for 2023: India remains the fastest-growing economy and Indian Rupee will recover

Insta Links:

Why is it essential to contain domestic inflation?

Mains Links:

Q. How would the recent phenomena of protectionism and currency manipulations in world trade affect the macroeconomic stability of India? (UPSC 2018)

Prelims Links: (UPSC 2022)

GS Paper 3

Syllabus: Indian Economy and issues relating to Planning, Mobilization of Resources

Source: IE

Direction: The article highlights why the number of stressed accounts reported to Lok Adalats by banks increased dramatically in 2021-22 and contains explanatory infographics on Lok Adalats and NPAs.

Context:

• In 2021-22, the number of non-performing assets (NPAs) referred by banks to various recovery channels, including Lok Adalat and the Insolvency and Bankruptcy Code (IBC), increased fourfold over 2020-21.
• Among all channels, the number of stressed accounts reported to Lok Adalats by banks increased dramatically in 2021-22.

Background:

 Bank’s Loan recovery mechanisms: 

• Lok Adalat: Conducted by NALSA, the awards of Lok Adalat are final and binding on all parties
• IBC: Introduced in 2016 and amended in 2021, IBC provides a time-bound process of resolving the insolvency of corporate debtors (330 days)
• Debt Recovery Tribunals (DRTs): Along with Debts Recovery Appellate Tribunals (est. Under Recovery of debts and Bankruptcy Act, 1993) for expeditious adjudication and recovery of debts.
• Securitisation and Reconstruction of Financial Assets and Enforcement of the Security Interest Act (SARFAESI Act 2002): Under this, banks can take control of securities pledged against the loan and manage or sell them to recover dues without any court intervention. 

Why cases referred to Lok Adalats increased dramatically?

• Banks send stressed accounts worth up to Rs.20 lakh to Lok Adalats, which are organised by banks in collaboration with the district legal service authority.
• The number of cases referred to Lok Adalats is high since the cost of recovery through this route is lower than through DRTs or SARFAESI.
• However, the rate of recovery through this route has been very low (2.3% in 2021-22 and 4% in 2020-21), as it is very difficult to recover loans from defaulters in the small-ticket loan segment.

Insta Links:

Why NPAs are not just about bank governance

Prelims Links:

(UPSC CSE 2017)

GS Paper 3

Syllabus: Role of Media and Social Networking Sites in Internal Security Challenges

Source: TH

Direction: The article explains deepfakes, threats as a result of malicious deepfakes, steps taken by countries across the world and some solutions to curb them.

Context: The disinformation threat has a new tool in the form of deep fakes.

What are deepfakes?

• Deepfakes are digital media – video, audio, and images edited and manipulated using Artificial Intelligence (AI) to inflict harm on individuals and institutions.
• AI-Generated Synthetic media or deepfakes have clear benefits in certain areas, such as accessibility, education, film production, criminal forensics, and artistic expression.
• However, it can be exploited (hyper-realistic digital falsification) to damage the reputation, fabricate evidence, defraud the public, and undermine trust in democratic institutions with fewer resources (cloud computing, AI algorithms and abundant data).

Threats:

• 96% of deepfakes are pornographic videos, reducing women to sexual objects and causing emotional distress.
• Deepfake can depict a person as indulging in antisocial behaviours and can create social discord, increase polarization, and can even influence the election outcome
• Deepfakes can accelerate the trust deficit in traditional media and could be used by nation-state actors to create chaos in the target country, undermining trust in institutions and
• Misuse by non-state actors (terrorist organisations), to stir anti-state sentiments among people.
• The threat of the liar’s dividend – an undesirable truth is dismissed as deepfake or fake news, giving more credibility to denials.
• Weaponisation of deepfakes, use of fake news and alternative-facts narrative to dismiss an actual piece of media and truth.

What countries are doing to combat deep fakes?

• China: A new policy that requires service providers and users to ensure that any doctored content using the technology is explicitly labelled and can be traced back to its source.
• The European Union: an updated Code of Practice, that requires tech companies including Google, Meta, and Twitter to take measures in countering deepfakes on their platforms.
  • If found non-compliant, these companies can face fines of as much as 6% of their annual global turnover.
• The U.S: The bipartisan Deepfake Task Force Act to assist the Department of Homeland Security (DHS) to counter deepfake technology by conducting an annual study of deep fakes.
• In India, there are no legal rules against using deep fake technology. However, specific laws can be addressed for misusing the tech, which includes Copyright Violation, Defamation and cybercrimes.

Case of Canada:

• While Canada does not have any regulations to tackle deep fakes, it is undertaking some of the most cutting-edge AI research with a number of domestic and foreign actors.
• Also, Canada is a member and leader in many related multilateral initiatives (Paris Call for Trust and Security in Cyberspace, Global Partnership on AI), which can be utilised to create deepfake policy in different areas.

Solutions:

• Media literacy for consumers is the most effective tool to combat disinformation and deep fakes.
• Meaningful regulations with a collaborative discussion with the technology industry, civil society and policymakers to disincentivise the creation and distribution of malicious deepfakes.
• Easy-to-use and accessible technology solutions to detect deepfakes, authenticate media, and amplify authoritative sources.
• Social media platforms are taking cognizance of the deepfake issue, and almost all of them have some policy or acceptable terms of use for deepfakes.

Conclusion: We must all take responsibility for being critical Internet media consumers, thinking and pausing before sharing on social media, and being part of the solution to this ‘infodemic.’

Insta Links:

Countering Deepfakes

Mains Links:

Q. Use of the internet and social media by non-state actors for subversive activities is a major security concern. How have these been misused in the recent past? Suggest effective guidelines to curb the above threat. (UPSC 2016)

GS Paper 4

Syllabus: Ethics, Morals and Religion

Source: DTE, Indian Express

Direction: These examples can be written in GS4 answers – on how religious leaders have a huge impact on the lives of common people.

Context: Pope Benedict XVI also famously called “The Green Pope”, who was the leader of the world’s Catholics for almost eight years, died recently.

Pope Benedict XVI’s view on Environment conservation:

• Benedict XVI helped to author several books that share his views on the real meaning of progress and development, and what that means for our planet of limited resources.
• Benedict turned heads when he chose electric vehicles for use within the grounds of the Vaticanand his summer home of Castel Gandolfo, as well as for the Vatican’s police force.
• In 2011, Benedict urged Italian students “to become guardians of nature and follow in the footsteps of St. Francis of Assisi, patron saint of ecology,”

Child abuse scandals

• Benedict was active in initiating the process to discipline and defrock predator priests.
• He ordered an inquiry into child abuse and kept “penance Fridays” where he would talk with abuse survivors.

Good Examples of Religious leaders from India and around:

Dalai Lama:

• Dalai Lama advocates compassion for animals and frequently urges people to try vegetarianismor at least reduce their consumption of meat.
• Before the 2009 United Nations Climate Change Conference, he urged national leaders to put aside domestic concerns and take collective action against climate change
• At the Culture of Compassion event, the Dalai Lama said – Warm-heartedness is a key factor for healthy individuals, healthy families and healthy communities.
• The Dalai Lama was awarded the Nobel Peace Prize in 1989, and the US Congressional Gold Medal in 2006. Time magazine named the Dalai Lama one of the “Children of Mahatma Gandhi” and Gandhi’s spiritual heir to nonviolence.
• Quote: “Ecology should be part of our daily life”.

Sri Sri Ravi Shankar (spiritual leader):

• Ravi Shankar is involved in interfaith dialogue and currently sits on the Board of World Religious Leaders for the Elijah Interfaith Institute. Through interfaith summits in 2008 and 2010, he has been engaging faith-based leaders for collective action against HIV.
• He started a prison programme to rehabilitate prison inmates and help them reintegrate into society.

Sadhguru:

• He advocates for protecting the environment against climate change, leading many initiatives like Project Green Hands (PGH), Rally for Rivers, Cauvery Calling, and the Journey to Save Soil.

Dawoodi Bohra (Shia Sect of Islam):

• The Bohras actively participate in environmental activism and consider it their religious duty. Nazafat (which means ‘cleanliness’) is an integral component of the Islamic faith, the Bohras engage in clean-up drives, tree planting, and other such initiatives wherever they reside.
• The bohra community launched Project Rise, a philanthropy focused on the marginalized and the poor. Their first initiative, undertaken in collaboration with Action Against Hunger, sought to address malnutrition among those living in Palghar and Govandi districts.

Ethics for Spiritual Leaders:

• Knowledge of Self
• Acting with genuineness
• Understanding Others
• Winning the trust of everyone
• Practising Spiritualism with the whole heart.

Insta Links:

Morality and Religion

Mains Link:

Q. Ethics derived from religious texts are of no use to civil servants in a secular state.” Do you agree? Comment.