[Mission 2024] QUED ( Questions from Editorials ) 21 November 2023

Solution: c)

The Union Cabinet approved a 4-percentage point hike in dearness allowance (DA) and dearness relief for central government employees and pensioners to 46 per cent from 42 per cent. This will benefit about 48.67 lakh central government employees and 67.95 lakh pensioners.

This increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission.

The dearness allowance for employees and pensioners is estimated on the basis of the latest Consumer Price Index for Industrial Workers (CPI-IW), which is released by the Labour Bureau every month.

DA is provided to government employees and pensioners factoring in the rising prices and the cost of living.

The government announced the grant of non-productivity linked bonus (ad-hoc bonus) to eligible employees for the year 2022-23. The ad-hoc bonus has been approved for Group C and non-gazetted Group B rank officials, including paramilitary forces. The calculation ceiling for payment of ad-hoc bonus under these orders has been kept at Rs 7,000.

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Solution: b)

Statement 1 is incorrect.

As the Father of the Nation, he might seem an obvious choice to have appeared on the national currency after the formation of independent India in 1947. But it was many decades after, only in 1996, that he became a permanent feature on legal banknotes of every denomination issued by the Reserve Bank of India (RBI) — India’s Central bank and the body responsible for regulating the Indian banking system.

The portrait of Gandhi visible on banknotes isn’t a caricature. It’s cut-out of a photograph taken in 1946, where he is standing with British politician Lord Frederick William Pethick-Lawrence.

The RBI’s Department of Currency Management is responsible for designing the rupee notes. It has to get approval for the designs from the central bank and the Union government.

According to Section 25 of the RBI Act, 1934, “the design, form and material of banknotes” shall be such as may be approved by the central government after consideration of the recommendations made by the central board.

Gandhi first featured on Indian currency in 1969, when a special series was issued to commemorate his 100th birth anniversary.

For a few months after the declaration of independent India on August 15, 1947, the RBI continued to issue notes from the colonial period featuring King George VI.

In 1950, the first Republic of India banknotes were issued in denominations of Rs 2, 5, 10 and 100. All of them bore the Lion Capital watermark.

Over the years, legal tenders of higher denominations were introduced, and the motifs on the back of the notes transitioned to represent new India — from fauna motifs such as tiger and sambar deer in the early years, to motifs depicting agricultural endeavours in the 1970s, such as farming and plucking of tea leaves. The 1980s saw emphasis on symbols of scientific and technological advancements and Indian art forms — the Aryabhatta satellite featured on the Rs 2 note, farm mechanisation on Rs 5 and the Konark Wheel on Rs 20, among others.

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Solution: d)

Banking sector credit growth is likely to be lower at 13-13.5 per cent in fiscal 2023-24, according to domestic rating agency Crisil Ratings. This expectation comes after bank credit clocked a robust 15.9 per cent in fiscal 2022-23 driven by a broad-based economic recovery, stronger, cleaner balance sheets and the lower base of the preceding two fiscals.

Crisil said moderation in bank credit will be on account of four factors.

1. Decline of gross domestic product

Gross domestic product (GDP) growth is expected to decline to 6 per cent on-year in FY24 from 7.2 per cent in the last fiscal. This lower GDP growth will have an impact on the overall credit growth of banks.

2. Softening in commodity prices

The rating agency sees inflation easing in this fiscal due to some softening in commodity prices, which will reduce the overall demand for working capital loans. In FY2023, a significant part of the growth in wholesale credit (comprising corporates and micro, small and medium enterprises, or MSMEs) was driven by higher working capital demand in a high-inflation environment.

3. Robust bond market issuance

Bond market issuances have been robust in the first half of FY2023 with the change in interest rate environment. Consequently, bank credit’s substitution of debt capital markets, which also supported wholesale credit growth last year, especially in the first half, is not being seen to the same extent this year, Crisil said.

4. High-base effect

The fourth factor for lower bank credit growth will be the high-base effect due to the strong credit growth in fiscal 2023, especially in the second half.

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Solution: b)

Statement 2 is incorrect.

Two specific advantages of Indian raw sugar:

First, it is free of dextran, a bacterial compound formed when sugarcane stays in the sun for too long after harvesting. “Our raw sugar has no dextran, as it is produced from fresh cane crushed within 12-24 hours of harvesting. The cut-to-crush time is 48 hours or more in Brazil.

Second, Indian mills could supply raws with a very high polarisation of 98.5-99.5%. Polarisation is the percentage of sucrose present in a raw sugar mass. The more the polarisation — it is only 96-98.5% in raws from Brazil, Thailand and Australia — the easier and cheaper it is to refine.

Solution: d)

In India, the Indus basin spreads over Jammu & Kashmir, Ladakh, Himachal Pradesh, Punjab and part of Rajasthan, Haryana, and Chandigarh.