Daily Editorial Analysis CAO Daily Editorial analysis for UPSC IAS 29th-January, 2018

Current Affairs Only Daily Editorial Analysis for Competitive Exams


29th Jan, 2018

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Red alert on the green index {Environment}

(The Hindu)


Out of the 180 countries assessed, India ranks low in the Environmental Performance Index (EPI) 2018, slipping from rank 141 in 2016, to 177 in 2018.

The EPI is produced jointly by Yale University and Columbia University in collaboration with the World Economic Forum.

Governments initiative to protect the environment

  • The government has set ambitious targets for environmental protection.
  • In December 2015, it notified new, strict environmental standards for coal-fired power plants, to be effective from January 2018.
  • An aggressive target was set to implement Bharat Stage VI emission norms from April 1, 2020, skipping Stage V norms.
  • In 2017, the Minister of State for Power and Renewable Energy said that a road map was being prepared so that only electric vehicles would be produced and sold in the country by 2030.
  • In order to accelerate the transition to renewable sources of power, the government, under the National Solar Mission, revised the target for setting up solar capacity from 20 GW to 100 GW by 2021-22.
  • The Centre has also assured the Supreme Court of India that the highly polluted Ganga will be cleaned up by 2018.

Issue

The government has gone back on its promise of implementing strict power plant emission norms by December 2017, and may even dilute the norms.

The automobile industry has categorically stated that based on current estimates, full conversion to electric vehicles is realistically possible only by 2047.

Recent environmental policy failures.

It is linked also to the lack of political will to implement even existing environmental laws and regulations.

Possible solution

Rapid transition to solar energy can be accomplished not only by enabling subsidies but also by pricing the more polluting fuels correctly.

The transition to electric vehicle use would be aided by pricing petrol and diesel, and perhaps the vehicles that use these fuels, to reflect their external costs to society.


Banking on good faith 

{Banking Sector}

 (The Hindu)


Context

More structural reforms are needed to maximise the bank recapitalisation effort.

About Rs. 1 lakh crore is expected to be pumped into India’s 21 public sector banks by March, which the Centre hopes will enable them to extend fresh credit lines worth over Rs. 5 lakh crore to spur economic activity.

The government has described each of the banks as “an article of faith”. Its assertion that no public-sector bank will fail and that depositors’ money will remain safe should allay customers’ worry about the safety of their savings under the proposed Financial Resolution and Deposit Insurance legislation.

Prompt corrective action (PCA)

The RBI deploys the PCA to monitor the operation of weaker banks more closely to encourage them to conserve capital and avoid risks.

State Bank of India, the country’s largest, and the nine others that are out of the RBI’s PCA net will receive nearly Rs. 36,000 crore in order to strengthen their lending capacity.

Why the need for PCA?

The 1980s and early 1990s were a period of great stress and turmoil for banks and financial in situations all over the globe. In USA, more than 1,600 commercial and savings banks in sured by the Federal Deposit Insurance Corporation (FDIC) were either closed or given financial assistance during this period.

The cumulative losses incurred by the failed institutions exceeded US $100 billion. These events led to the search for appropriate supervisory strategies to avoid bank failures as they can have a destabilising effect on the economy.


 

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