India, China Pressed to Join Fund to Pay Poor Nations for Climate Damage; G20’s ‘Recover Together’ Theme Belied By Inward Focus of Rich Nations

India’s exports in sharp decline, negative BoP ahead, RBI and Centre defend demonetisation, subsidies cross budget again, Bengaluru NGO mined voter data, it’s Brahmins vs non-Brahmins in Trichy temple

A newsletter from The Wire & Galileo Ideas | Contributors: MK Venu, Seema Chishti, Siddharth Varadarajan, Sidharth Bhatia, Sushant Singh and Tanweer Alam | Editor: Pratik Kanjilal

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Snapshot of the day

November 17, 2022

Pratik Kanjilal

Actor Suhasini Mulay is standing surety for Bhima Koregaon accused Gautam Navlakha to be moved to house arrest. But his release from prison has been further delayed after the Special Court disapproved of the location, following objections and safety concerns raised by the National Investigation Agency. Earlier today, his lawyer told the Supreme Court that its order is not being followed by the state authorities. The CJI listed the matter for hearing tomorrow before a bench headed by Justice KM Joseph, which had passed the house arrest order.

Indian refiners are wary of buying Russian crude oil loading after December 5, when EU sanctions take effect, pending clarity on the proposed G7 price cap mechanism. Reliance Industries and state-­run Bha­rat Petroleum have not placed orders yet. Reliance is cautious about reactions from fo­reign banks, given its expo­sure to the Western financial system and overseas sales of refined products. 

Exports to seven of India’s top 10 destinations, including the US, the UAE and China, which receive 47% of exports, contracted in October and outbound shipments dipped for the first time in two years, according to the Department of Commerce. The value of exports to the US, India’s biggest export market for a decade, dropped 25% to $5.38 billion in October. Exports to the UAE, which signed a free trade agreement with India earlier this year, fell 18% to $1.98 billion.

Due to the high cost of opera­tions, earnings before interest, tax, depreciation and amortisation (EBITDA) margin of 43% of MSMEs will remain below pre-pandemic (FY20) levels this fiscal. Companies could not completely pass on high prices of some commod­ities and the exchange rate was unfavourable, reveals SME Re­port 2022 of Crisil Market Intelligence & Analytics. It covers 69 sectors and 147 clusters that logged revenue of Rs 56­ lakh crore, or about two-thirds of MSMEs, which represent 20­-25% of GDP.

China and India, two of the world’s three biggest emitters of greenhouse gases, are under pressure from developing nations to contribute towards compensating the world’s poorest nations for climate-related disasters. Mauritius, Jamaica and Ghana are among developing countries that want the pool of funders for the loss and damage facility being discussed at COP27 to be widened beyond the Western industrialised nations traditionally held responsible for global warming. India’s delegation at COP27 opposed this, saying that its share of historical cumulative emissions from the pre-industrial period until 2019 is less than 4%. 

A consortium of countries including India, China and Brazil have jointly opposed carbon border taxes, which could cause market distortions and aggravate trust deficits. The European Union has proposed a Carbon Border Adjustment Mechanism to tax carbon inten­sive products like ce­ment and steel, from 2026. Brazil, India, South Africa and China (BASIC), large economies signifi­cantly dependent on coal, have for years voiced common concerns and reiterated their right to use fossil fuels during their transition to clean energy. They ex­pressed “grave concern” that developed countries were not showing leadership or responding with a matching effort.

Demonetisation was a well-considered decision which led to several benefits such as reduction of fake currency notes, increase in digital transactions and increased detection of unaccounted income, the Centre has told the Supreme Court in a fresh affidavit. The impact of demonetisation on growth was “transient”,  with the real growth rate being 8.2% in FY16-17 and 6.8% in FY17-18, more than the pre-pandemic decadal growth rate of 6.6%. The government said that the central board of RBI made a specific recommendation for demonetisation and also proposed a draft scheme for its implementation, in accordance with the RBI Act. RBI, in its affidavit filed separately before the top court, too justified demonetisation, contending that the inconvenience caused to the public cannot be a ground to challenge a decision taken in the “national economic interest”.

Since the Vande Bharat Express ran over cattle on the Gandhinagar-Mumbai route, the government will construct a boundary wall on a 1,000-km stretch in six months to prevent such accidents. Rail accidents involving cattle and humans have increased this year. While 2,115 cases were reported in FY2022, 2,650 have been reported in just six months between April and October 2022.

The Supreme Court has directed the Centre and the Indian Air Force to consider granting Permanent Commission to 32 retired women Short Service Commission officers to secure them pension benefits. Chief Justice of India DY Chandrachud and Justices Hima Kohli and JB Pardiwala, however, refused to order reinstatement, since they were released from service long ago, between 2006 and 2009. The bench said the women IAF officers, if found eligible by the IAF for grant of permanent commission, would be entitled to grant of one-time pension benefits from the date when they would have completed 20 years in service, had they continued.

Subsidies on food, fertiliser and fuel will cost Rs 5.4 trillion ($67 billion) in the fiscal year ending March 2023, against the budget estimate of Rs 3.2 trillion, reports Bloomberg. For the third year, India will miss its subsidy estimates, which comprise a tenth of government expenditure. It will force the government to cut spending in other areas.

EKI Energy Services sought just $2 million in its IPO on BSE last year. But soon after, its shares shot up 10,000%, taking its valuation from $10 million to $1 billion. By December, it was the year’s best-performing stock, making its founder a millionaire hundreds of times over. It’s the first listed carbon offsets company, and the market price of offsets had soared.  But their value is now in question, and EKI’s shares have fallen 48%. The worth of a carbon offset is gauged by its utility in cutting worldwide emissions, and not all are equal. In fact, they may not help the climate battle at all.

TRAI is set to roll out its mobile phone caller identity system, verified by KYC, in three weeks, to go up against Truecaller.

Wearing masks on domestic flights will now be optional. In-flight announcements may only say that passengers should preferably use masks/face covers, without reference to fines or penal action. During the pandemic, following a Delhi High Court order, airlines were instructed to de-board passengers who do not wear masks.

In 2013, a study published in the International Journal of Disaster Risk Reduction, an affiliate of the Davos-based Global Risk Forum, said that religious gatherings and pilgrimages account for 79% of all stampedes in India. But believers perish in other ways, too, owing to poor infrastructure and forbidding locations.

At the G20 summit in Indonesia, UK PM Rishi Sunak said that his country should not “sacrifice quality for speed” in the trade deal with India. The deadline set by Sunak’s predecessors Boris Johnson and Liz Truss was October 24.

Jobs of around 12,000 engineers from India working in Kuwait are at risk, with their degrees suddenly derecognised. The Kuwait Society of Engineers (KSE) is not issuing residency renewal NoCs for Indian graduates of colleges not cleared by the National Board of Accreditation.