Economy is an important part of the UPSC prelims and mains exams; this series titled ‘Economy This Week’ has been initiated to address the need to read and analyse economic articles in various business-related newspapers. The round-up of the Economy/Business section news for 1st to 7th Oct 2022 2022 is given below. Business news is essential for IAS exam preparation.
TABLE OF CONTENTS
1. PMKVY - House panel flags underutilisation of finances (BS 3/10/22) 2. EC asks parties to explain how they plan to finance poll promises (IE 5/10/22) 3. World Bank Report - 56 mn Indians turned poor (BS 7/10/22) 4. Kisan drones get a helping hand (BL 3/10/22) 5. Fodder inflation (IE 3/10/22) 6. OPEC+ agrees to cut output (TH 6/10/22) 7. Centre raises credit limit under ECLGS (TH 6/10/22) 8. Online betting ads - government against it (BS 5/10/22) 9. Monetary policy (IE 1/10/22)
1. PMKVY – House panel flags underutilisation of finances (BS 3/10/22)
- Pradhan Mantri Kaushal Vikas Yojana (PMKVY) was launched in January 2021 to promote skill development across the country
- It has adopted the demand driven bottom up approach to skilling
- A parliamentary standing committee has raised concerns over underutilisation of funds and lower placement issues which continue to persist despite revamping the Pradhan Mantri Kaushal Vikas Yojana (PMKVY)
- The scheme is being implemented by the National Skill Development Corporation (NSDC)
- Under this a total of 399860 candidates have been certified and of this only 30599 (7.7%) have been placed as of June 30
- The govt has released ₹ 686 Cr of which ₹ 294 Cr has been utilised so far
- Certain implementation issues raised by the govt have been
- Pandemic has disrupted the process
- Delays in issuing of the funds from the state treasury
- Non-availability of the trainers with right eligibility criteria
- Limited or non-availability of the placement partners
2. EC asks parties to explain how they plan to finance poll promises (IE 5/10/22)
- Election Commission (EC) has asked the political parties to spell out the ways and means through which they would be raising additional resources to finance their poll promises and its impact on finances of states/centre
- EC has prescribed a standard disclosure proforma for the political parties
- To declare quantification of physical coverage of the schemes promised, financial implications and availability of financial resources
- Extent and expanse of the coverage of the coverage of the scheme (APL, BPL, community specific etc)
- The party will have to give a clarity over the source of finances – tax, non-tax, rationalise expenditures, additional borrowings etc
- Impact of additional resources on central and state finances
- EC stated that such disclosures will bring standardisation in the form of information and will help voters decide. To make this mandatory, EC has decided to propose recommending changes to Model Code of Conduct
- Existing guidelines require political parties to explain the rationale for poll promises, the declarations though have been routine, ambiguous and not providing adequate information
3. World Bank Report – 56 mn Indians turned poor (BS 7/10/22)
- As per the latest WTO report – Poverty and Shared Prosperity – has stated that about 56 mn Indians may have been forced into extreme poverty in 2020 as a result of the pandemic
- The global number has increased by 71 mn and this is by far the worst year for reduction of poverty since the 2nd world war
- The goal of ending extreme poverty by 2030 will be missed and by then around 600 mn people will remain in abject poverty
- World bank has made a fresh estimate by using the new extreme poverty line of $2.15 as against the traditional number of $1.9 based on purchasing power parity (PPP)
- The authority has used Consumer Pyramid Household Survey (CPHS) as the Household Consumption Expenditure Survey data is not available since 2011-12
- With this poverty line, the extreme poverty has come down from 11.09% in 2018 to 10.01 in 2019
- The report has however contended that poverty has reduced since 2011 in India as the large poverty reduction has come from rural areas
- N C Saxena – member of Planning Commission – has stated that the world bank has underestimated the poverty in India by measuring it at purchasing power parity value of the dollar which is around ₹ 20 only
- Many estimates by the experts have pointed it out that during the pandemic 275 to 300 man people have fallen into extreme poverty
- NITI Aayog report itself identifies that there is 25% of the population is poor
4. Kisan drones get a helping hand (BL 3/10/22)
- RBI has asked the banks to start financing the purchasing the agriculture drones
- This is in line it’s the announcement in budget
- NABARD has fixed the unit cost (can go up to a maximum of ₹ 10 lakh) of drone and the banks can use the unit costs for financing the drones to individuals and farmer producer organisations (FPOs)
- The state and centre would jointly provide a subsidy of 40% subsidy per drone
- As per the Kisan Drone Scheme, NABARD would be extending the necessary skill development support to youth in rural parts
- The drones can serve up to 20 acres a day at ₹ 500 per acre
5. Fodder inflation (IE 3/10/22)
- Due to rainfall the availability of the fodder has gone down leading to hike in prices. The green fodder is short by 12 to 15% and the dry fodder by 25 to 26%
- The fodder prices have put pressure on agriculture households and has a direct bearing on the milk prices too
- The WPI for fodder stood at 25.54% in august 2022, it has been rising since December 2021
- This is the highest in last 9 years
- The overall WPI has softened during this period
6. OPEC+ agrees to cut output (TH 6/10/22)
- OPEC+ members have agreed for a deepest cut in oil output since 2020
- The grouping has agreed to cut 2 million barrels per day (mbpd) and this led to rise of about 1% in prices of oil and is expected to spur the recovery in oil prices
- The real impact of cut would be smaller as some of the members are failing to reach their output quotas
7. Centre raises credit limit under ECLGS (TH 6/10/22)
- The ministry of finance has raised the credit limit under the Emergency Credit Line Guarantee Scheme (ECLGS) and making them eligible for a sum equivalent to 100% (from 50%) of their outstanding debt up to a maximum of ₹ 1500 Cr (earlier it was ₹ 400 Cr)
- This is the second time such an extension has been provided to the aviation sector
8. Online betting ads – government against it (BS 5/10/22)
- All Indian Gaming Federation (AIGF) has welcomed the decision of the government to support the govt advisory against showing ads of online betting sites on any television and digital media platforms
- MEITY has issued advisories to TV channels, digital news publishers, OTT platforms to refrain from showing ads on online betting sites. It has also asked the channels to stop airing surrogate ads of such illegal sites
9. Monetary policy (IE 1/10/22)
- RBI has increased the repo rate by 50 bps to 5.9% and lowered the growth projection to 7% from earlier estimate of 7.2%
- This is the fourth hike since may 2022 (and third on trot at 50 bps; in may the hike was 40 bps). Collectively the central baker has increased the interest rate by 190 bps in last five months
Economy This Week (1st to 7th Oct 2022):- Download PPT Here
ETW (1st to 7th Oct 2022):- Download PDF Here
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