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News 1: Use of Web3 and AI in banking to detect fraud
Background:
- Union Minister for Finance and Corporate Affairs Nirmala Sitharaman on Friday asked banks to be more digital savvy and give immediate priority to use Web3 and artificial intelligence technology in fraud detection and to generate early warning signs in case of an unforeseen event.
Web3:
- Web3 embraces decentralization and is being built, operated, and owned by its users.
- Web3 puts power in the hands of individuals rather than corporations.
- Web3 uses blockchains, cryptocurrencies, and NFTs to give power back to the users in the form of ownership.
Core principles:
- Web3 is decentralized: instead of large swathes of the internet controlled and owned by centralized entities, ownership gets distributed amongst its builders and users.
- Web3 is permissionless: everyone has equal access to participate in Web3, and no one gets excluded.
- Web3 has native payments: it uses cryptocurrency for spending and sending money online instead of relying on the outdated infrastructure of banks and payment processors.
- Web3 is trustless: it operates using incentives and economic mechanisms instead of relying on trusted third parties.
Artificial intelligence:
- Artificial intelligence (AI) refers to the simulation of human intelligence in machines that are programmed to think like humans and mimic their actions. The term may also be applied to any machine that exhibits traits associated with a human mind such as learning and problem-solving.
- Narrow AI or Artificial Narrow Intelligence (ANI)—is AI trained and focused to perform specific tasks. Example: Apple’s Siri, Amazon’s Alexa, IBM Watson, and autonomous vehicles.
- Strong AI is made up of Artificial General Intelligence (AGI) and Artificial Super Intelligence (ASI). Artificial general intelligence (AGI), or general AI, is a theoretical form of AI where a machine would have an intelligence equaled to humans; it would have a self-aware consciousness that has the ability to solve problems, learn, and plan for the future.
- Artificial Super Intelligence (ASI)—also known as superintelligence—would surpass the intelligence and ability of the human brain.
- Machine learning, deep learning, and neural networks are all sub-fields of artificial intelligence. However, neural networks is actually a sub-field of machine learning, and deep learning is a sub-field of neural networks.
News 2: Sitharaman asks private firms to clear MSME dues in 45 days
Background:
- Finance Minister Nirmala Sitharaman on Friday asked the private sector to clear dues of micro, small and medium enterprises (MSMEs) within 45 days.
- The Centre revised the threshold for small firms’ paid-up capital to ₹4 crore from ₹2 crore.
- The turnover threshold has also been revised to “not exceeding ₹40 crore” from ₹20 crore.
MSMEs definition:
- Micro enterprises: Not more than Rs.1 crore and Annual Turnover; not more than Rs. 5 crore
- Small enterprises: Not more than Rs.10 crore and Annual Turnover; not more than Rs. 50 crore
- Medium enterprises: Not more than Rs.50 crore and Annual Turnover; not more than Rs. 250 crore
News 3: Front-loaded rate hikes needed to tame inflation: RBI
Background:
- Inflation has remained above the RBI’s tolerance level since January, prompting it to raise interest rates by a total of 140 basis points in the current cycle.
Reason behind high inflation:
- Resurgence of food price pressures, mainly from cereals, even as fuel and core components such as transport and manufacturing provided a modest measure of respite.
RBI:
- Established: 1935 established under RBI Act, 1934; Nationalized in 1949
- Headquarter: Mumbai
Objective:
- To regulate the issue of Bank notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage;
- To have a modern monetary policy framework to meet the challenge of an increasingly complex economy, to maintain price stability while keeping in mind the objective of growth.
Function:
Monetary Authority:
- Formulates, implements and monitors the monetary policy.
- Objective: maintaining price stability while keeping in mind the objective of growth.
Regulator and supervisor of the financial system:
- Prescribes broad parameters of banking operations within which the country’s banking and financial system functions.
- Objective: maintain public confidence in the system, protect depositors’ interest and provide cost-effective banking services to the public.
Manager of Foreign Exchange
- Manages the Foreign Exchange Management Act, 1999.
- Objective: to facilitate external trade and payment and promote orderly development and maintenance of foreign exchange market in India.
Issuer of currency:
- Issues, exchanges and destroys currency notes as well as puts into circulation coins minted by Government of India.
- Objective: to give the public adequate quantity of supplies of currency notes and coins and in good quality.
Developmental role
- Performs a wide range of promotional functions to support national objectives.
Regulator and Supervisor of Payment and Settlement Systems:
- Introduces and upgrades safe and efficient modes of payment systems in the country to meet the requirements of the public at large.
- Objective: maintain public confidence in payment and settlement system
Related Functions
- Banker to the Government: performs merchant banking function for the central and the state governments; also acts as their banker.
- Banker to banks: maintains banking accounts of all scheduled banks.
News 4: Sri Lanka set to revive and upgrade FTA with India
Background:
- Sri Lanka will revive its Free Trade Agreement (FTA) with India and upgrade it to “a comprehensive economic and technological partnership”, President Ranil Wickremesinghe has said, signalling Colombo’s willingness to revisit a stalled pact.
Indo – Sri Lanka Free Trade Agreement:
- Indo-Sri Lanka Free Trade Agreement (ISFTA) came into effect in 2000 and several rounds of bilateral discussions later, Colombo and New Delhi are yet to reach an agreement on its upgraded version.
Areas of engagement:
- The power grid connection between India and Sri Lanka, offshore wind energy, the solar power plant at Sampur and the renewable energy projects on three islands of Jaffna Peninsula, Development of west terminal at Colombo airport.
Free Trade Agreement:
- India has signed 13 Free Trade Agreements (FTAs) with its trading partners, including the 3 agreements, namely India-Mauritius Comprehensive Economic Cooperation and Partnership Agreement (CECPA), India-UAE Comprehensive Partnership Agreement (CEPA) and India-Australia Economic Cooperation and Trade Agreement (IndAus ECTA) signed during the last five years.
- India shares preferential market access and economic cooperation through trade agreements with over 50 countries.
News 5: Bio-Diesel
Background:
- As part of efforts to reduce its carbon footprint, the Indian Air Force (IAF) is looking to fly an AN-32 transport aircraft modified to operate on 10% blended biodiesel for 200 flight hours in the next six months, Air Vice Marshal S. K. Jain, Assistant Chief of the Air Force (Maintenance Plans), said on Friday.
Biodiesel:
- Biodiesel is a liquid fuel derived from animal fats, vegetable oils, and waste cooking oil, which is a possible replacement for conventional diesel fuel.
- Bio-diesel is an eco-friendly, alternative diesel fuel prepared from domestic renewable resources ie. vegetable oils (edible or non- edible oil) and animal fats.
- These natural oils and fats are primarily made up of triglycerides.
- These triglycerides when it reacts chemically with lower alcohols in presence of a catalyst result in fatty acid esters.
- These esters show striking similarity to petroleum derived diesel and are called “Biodiesel”.
Benefits of biodiesel:
- It reduces vehicle emission which makes it eco-friendly.
- It is made from renewable sources and can be prepared locally.
- Increases engine performance because it has higher cetane numbers as compared to petro diesel.
- It has excellent lubricity.
- Increased safety in storage and transport because the fuel is nontoxic and biodegradable (Storage, high flash point)
- Production of bio diesel in India will reduce dependence on foreign suppliers, thus helpful in price stability.
- Reduction of greenhouse gasses at least by 3.3 kg CO2 equivalent per kg of biodiesel.
News 6: The cheetahs are coming
Background:
- Eight African cheetahs from Namibia — five females and three males between the ages of 4-6 years — will be flown 8,000 km over the Indian ocean to the Kuno National Park in Madhya Pradesh, where they will be released as part of India’s Rs 90-crore Cheetah Introduction project.
- This is the first time in the world that a large carnivore will be relocated from one continent to another.
Origin of Cheetah:
- The cheetah has an ancient history in the country, with a Neolithic cave painting of a ‘slender spotted feline being hunted’ having been found at Chaturbunj Nala in Mandasur, Madhya Pradesh.
- The name ‘cheetah’ is believed to have originated from Sanskrit word chitrak, which means ‘the spotted one’.
- In India, the cheetah population used to be fairly widespread.
- The animal was found from Jaipur and Lucknow in the north to Mysore in the south, and from Kathiawar in the west to Deogarh in the east.
- The cheetah is believed to have originated in South Africa and spread across the world through land connectivity.
Extinction:
- The cheetah was officially declared extinct by the Indian government in 1952.
- While over-hunting was a major contributing factor for the cheetah’s extinction, the decimation of its relatively narrow prey base species and the loss of its grassland-forest habitat also played a role.
- During the decades preceding independence, as well as those after, India’s emphasis on agriculture – which included acquiring and parcelling off grassland – led to a decline in the cheetah’s habitat.
Why is the cheetah being brought back?
- The aim behind the translocation is not only to restore India’s ‘historic evolutionary balance’, but also to develop a cheetah ‘metapopulation’ that will help in the global conservation of the animal.
- As it is a flagship species, the conservation of the cheetah will revive grassland-forests and its biome and habitat, much like Project Tiger has done for forests and all the species found in these forests.
- Project Tiger has also resulted in the conservation of 250 water bodies found in India’s 52 Tiger Reserves. The Cheetah Project is likely to have a similar impact.
Why was Kuno National Park chosen for settling of Cheetah:
- Kuno, which had been monitored since 2006, was found to be ready to receive the cheetah immediately, as it had already been prepared for the Asiatic Lion.
- Both animals share the same habitat – semi-arid grasslands and forests that stretch across Gujarat, Rajasthan and Madhya Pradesh.
- The upgradation of sites required investment on a large scale in terms of reducing anthropogenic pressures through relocation of villages, mitigating infrastructure (roadways and railway) and prey augmentation for the cheetah through translocation of blackbuck, chital, chinkara and wild boar, among other animals.
- While Kuno itself has a healthy prey base (with chital, sambhal, neel gai, wild pig, gazelle, langur, peafowl), 700 more such herbivores have also been introduced to the area.
- In Sheopur district, where Kuno is located, rainfall levels, temperatures, altitude, and conditions are similar to conditions in both South Africa and Namibia.
News 7: SCO summit in Uzbekistan
Resilient supply chains:
- Prime Minister Narendra Modi urged Shanghai Cooperation Organisation member states Friday to “give each other full right to transit”.
- Addressing the SCO summit that included China President Xi Jinping and Russia President Vladimir Putin in the Uzbekistan city of Samarkand, Modi framed the “right to transit” in the context of connectivity and how it could help establish reliable and resilient supply chains in the region.
- Lack of transit across Pakistan’s territory has been a challenge for India to access Central Asian markets, and Delhi has flagged this concern several times in the past.
India – Turkey:
- Economic and commercial relationship assumes an important dimension in bilateral relationship, diplomatic ties have been adversely impacted over Turkey’s public criticism of the revocation of Article 370 in Jammu and Kashmir and the February 2020 riots in north-east Delhi.
India – Iran:
- Reviewed the progress in the development of the Shahid Behesti terminal, Chabahar Port and underscored the importance of bilateral cooperation in the field of regional connectivity.
- India-Iran bilateral ties are marked by historic and civilizational connections, including strong people to people contacts.
Samarkand Declaration of SCO summit:
- Leaders of SCO member states sign Samarkand declaration which included a decision on the Comprehensive Action Plan for 2023-27 for the implementation of provisions of the treaty on long-term good neighbourliness, friendship and cooperation among the SCO member states.
- Varanasi was declared as the tourist and cultural capital of the SCO in 2022 – 23.
SCO:
- SCO is a permanent intergovernmental international organization, established in 2001
- aims to maintain peace, security and stability in the region.·
- Prior to creation of SCO in 2001, Shanghai Five was there which included the members China, Russia, Kazakhstan, Kyrgyzstan and Tajikistan
- Headquarter: Beijing
- Members: China, Russia, Kazakhstan, Kyrgyzstan,Tajikistan, Uzbekistan, India, Pakistan. India and Pakistan became members in 2017. In September 2021, it was announced Iran will become a full-time member.
Regional Anti-Terrorist Structure – Shanghai Cooperation
- Organization (RATS-SCO) : RATS is a permanent body of the SCO and is intended to facilitate coordination and interaction between the SCO member states in the fight against terrorism, extremism and separatism.
- SCO member countries contribute about 30 per cent of global GDP, and 40 per cent of the world’s population also lives in SCO countries.
Recent Posts
The United Nations has shaped so much of global co-operation and regulation that we wouldn’t recognise our world today without the UN’s pervasive role in it. So many small details of our lives – such as postage and copyright laws – are subject to international co-operation nurtured by the UN.
In its 75th year, however, the UN is in a difficult moment as the world faces climate crisis, a global pandemic, great power competition, trade wars, economic depression and a wider breakdown in international co-operation.
Still, the UN has faced tough times before – over many decades during the Cold War, the Security Council was crippled by deep tensions between the US and the Soviet Union. The UN is not as sidelined or divided today as it was then. However, as the relationship between China and the US sours, the achievements of global co-operation are being eroded.
The way in which people speak about the UN often implies a level of coherence and bureaucratic independence that the UN rarely possesses. A failure of the UN is normally better understood as a failure of international co-operation.
We see this recently in the UN’s inability to deal with crises from the ethnic cleansing of the Rohingya Muslims in Myanmar, to civil conflict in Syria, and the failure of the Security Council to adopt a COVID-19 resolution calling for ceasefires in conflict zones and a co-operative international response to the pandemic.
The UN administration is not primarily to blame for these failures; rather, the problem is the great powers – in the case of COVID-19, China and the US – refusing to co-operate.
Where states fail to agree, the UN is powerless to act.
Marking the 75th anniversary of the official formation of the UN, when 50 founding nations signed the UN Charter on June 26, 1945, we look at some of its key triumphs and resounding failures.
Five successes
1. Peacekeeping
The United Nations was created with the goal of being a collective security organisation. The UN Charter establishes that the use of force is only lawful either in self-defence or if authorised by the UN Security Council. The Security Council’s five permanent members, being China, US, UK, Russia and France, can veto any such resolution.
The UN’s consistent role in seeking to manage conflict is one of its greatest successes.
A key component of this role is peacekeeping. The UN under its second secretary-general, the Swedish statesman Dag Hammarskjöld – who was posthumously awarded the Nobel Peace prize after he died in a suspicious plane crash – created the concept of peacekeeping. Hammarskjöld was responding to the 1956 Suez Crisis, in which the US opposed the invasion of Egypt by its allies Israel, France and the UK.
UN peacekeeping missions involve the use of impartial and armed UN forces, drawn from member states, to stabilise fragile situations. “The essence of peacekeeping is the use of soldiers as a catalyst for peace rather than as the instruments of war,” said then UN Secretary-General Javier Pérez de Cuéllar, when the forces won the 1988 Nobel Peace Prize following missions in conflict zones in the Middle East, Africa, Asia, Central America and Europe.
However, peacekeeping also counts among the UN’s major failures.
2. Law of the Sea
Negotiated between 1973 and 1982, the UN Convention on the Law of the Sea (UNCLOS) set up the current international law of the seas. It defines states’ rights and creates concepts such as exclusive economic zones, as well as procedures for the settling of disputes, new arrangements for governing deep sea bed mining, and importantly, new provisions for the protection of marine resources and ocean conservation.
Mostly, countries have abided by the convention. There are various disputes that China has over the East and South China Seas which present a conflict between power and law, in that although UNCLOS creates mechanisms for resolving disputes, a powerful state isn’t necessarily going to submit to those mechanisms.
Secondly, on the conservation front, although UNCLOS is a huge step forward, it has failed to adequately protect oceans that are outside any state’s control. Ocean ecosystems have been dramatically transformed through overfishing. This is an ecological catastrophe that UNCLOS has slowed, but failed to address comprehensively.
3. Decolonisation
The idea of racial equality and of a people’s right to self-determination was discussed in the wake of World War I and rejected. After World War II, however, those principles were endorsed within the UN system, and the Trusteeship Council, which monitored the process of decolonisation, was one of the initial bodies of the UN.
Although many national independence movements only won liberation through bloody conflicts, the UN has overseen a process of decolonisation that has transformed international politics. In 1945, around one third of the world’s population lived under colonial rule. Today, there are less than 2 million people living in colonies.
When it comes to the world’s First Nations, however, the UN generally has done little to address their concerns, aside from the non-binding UN Declaration on the Rights of Indigenous Peoples of 2007.
4. Human rights
The Human Rights Declaration of 1948 for the first time set out fundamental human rights to be universally protected, recognising that the “inherent dignity and of the equal and inalienable rights of all members of the human family is the foundation of freedom, justice and peace in the world”.
Since 1948, 10 human rights treaties have been adopted – including conventions on the rights of children and migrant workers, and against torture and discrimination based on gender and race – each monitored by its own committee of independent experts.
The language of human rights has created a new framework for thinking about the relationship between the individual, the state and the international system. Although some people would prefer that political movements focus on ‘liberation’ rather than ‘rights’, the idea of human rights has made the individual person a focus of national and international attention.
5. Free trade
Depending on your politics, you might view the World Trade Organisation as a huge success, or a huge failure.
The WTO creates a near-binding system of international trade law with a clear and efficient dispute resolution process.
The majority Australian consensus is that the WTO is a success because it has been good for Australian famers especially, through its winding back of subsidies and tariffs.
However, the WTO enabled an era of globalisation which is now politically controversial.
Recently, the US has sought to disrupt the system. In addition to the trade war with China, the Trump Administration has also refused to appoint tribunal members to the WTO’s Appellate Body, so it has crippled the dispute resolution process. Of course, the Trump Administration is not the first to take issue with China’s trade strategies, which include subsidises for ‘State Owned Enterprises’ and demands that foreign firms transfer intellectual property in exchange for market access.
The existence of the UN has created a forum where nations can discuss new problems, and climate change is one of them. The Intergovernmental Panel on Climate Change (IPCC) was set up in 1988 to assess climate science and provide policymakers with assessments and options. In 1992, the UN Framework Convention on Climate Change created a permanent forum for negotiations.
However, despite an international scientific body in the IPCC, and 165 signatory nations to the climate treaty, global greenhouse gas emissions have continued to increase.
Under the Paris Agreement, even if every country meets its greenhouse gas emission targets we are still on track for ‘dangerous warming’. Yet, no major country is even on track to meet its targets; while emissions will probably decline this year as a result of COVID-19, atmospheric concentrations of greenhouse gases will still increase.
This illustrates a core conundrum of the UN in that it opens the possibility of global cooperation, but is unable to constrain states from pursuing their narrowly conceived self-interests. Deep co-operation remains challenging.
Five failures of the UN
1. Peacekeeping
During the Bosnian War, Dutch peacekeeping forces stationed in the town of Srebrenica, declared a ‘safe area’ by the UN in 1993, failed in 1995 to stop the massacre of more than 8000 Muslim men and boys by Bosnian Serb forces. This is one of the most widely discussed examples of the failures of international peacekeeping operations.
On the massacre’s 10th anniversary, then UN Secretary General Kofi Annan wrote that the UN had “made serious errors of judgement, rooted in a philosophy of impartiality”, contributing to a mass murder that would “haunt our history forever”.
If you look at some of the other infamous failures of peacekeeping missions – in places such as Rwanda, Somalia and Angola – it is the limited powers given to peacekeeping operations that have resulted in those failures.
2. The invasion of Iraq
The invasion of Iraq by the US in 2003, which was unlawful and without Security Council authorisation, reflects the fact that the UN is has very limited capacity to constrain the actions of great powers.
The Security Council designers created the veto power so that any of the five permanent members could reject a Council resolution, so in that way it is programmed to fail when a great power really wants to do something that the international community generally condemns.
In the case of the Iraq invasion, the US didn’t veto a resolution, but rather sought authorisation that it did not get. The UN, if you go by the idea of collective security, should have responded by defending Iraq against this unlawful use of force.
The invasion proved a humanitarian disaster with the loss of more than 400,000 lives, and many believe that it led to the emergence of the terrorist Islamic State.
3. Refugee crises
The UN brokered the 1951 Refugee Convention to address the plight of people displaced in Europe due to World War II; years later, the 1967 Protocol removed time and geographical restrictions so that the Convention can now apply universally (although many countries in Asia have refused to sign it, owing in part to its Eurocentric origins).
Despite these treaties, and the work of the UN High Commission for Refugees, there is somewhere between 30 and 40 million refugees, many of them, such as many Palestinians, living for decades outside their homelands. This is in addition to more than 40 million people displaced within their own countries.
While for a long time refugee numbers were reducing, in recent years, particularly driven by the Syrian conflict, there have been increases in the number of people being displaced.
During the COVID-19 crisis, boatloads of Rohingya refugees were turned away by port after port. This tragedy has echoes of pre-World War II when ships of Jewish refugees fleeing Nazi Germany were refused entry by multiple countries.
And as a catastrophe of a different kind looms, there is no international framework in place for responding to people who will be displaced by rising seas and other effects of climate change.
4. Conflicts without end
Across the world, there is a shopping list of unresolved civil conflicts and disputed territories.
Palestine and Kashmir are two of the longest-running failures of the UN to resolve disputed lands. More recent, ongoing conflicts include the civil wars in Syria and Yemen.
The common denominator of unresolved conflicts is either division among the great powers, or a lack of international interest due to the geopolitical stakes not being sufficiently high. For instance, the inaction during the Rwandan civil war in the 1990s was not due to a division among great powers, but rather a lack of political will to engage.
In Syria, by contrast, Russia and the US have opposing interests and back opposing sides: Russia backs the government of the Syrian dictator Bashar al-Assad, whereas the US does not.
5. Acting like it’s 1945
The UN is increasingly out of step with the reality of geopolitics today.
The permanent members of the Security Council reflect the division of power internationally at the end of World War II. The continuing exclusion of Germany, Japan, and rising powers such as India and Indonesia, reflects the failure to reflect the changing balance of power.
Also, bodies such as the IMF and the World Bank, which are part of the UN system, continue to be dominated by the West. In response, China has created potential rival institutions such as the Asian Infrastructure Investment Bank.
Western domination of UN institutions undermines their credibility. However, a more fundamental problem is that institutions designed in 1945 are a poor fit with the systemic global challenges – of which climate change is foremost – that we face today.