Indian Express Explained 29/05/2020 | TEMS IAS

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1)What are 7.75 per cent RBI bonds? Govt. Decided to Withdraw it.

The 7.75 bonds 2018 were issued with effect from January 10, 2018 and were available for subscription to resident citizens/HUF to invest in a taxable bond. ( Also Read about Payment Banks )

While one bond was of Rs 1,000 each, the bonds had no maximum limit for investment.

The bonds had a 7-year lock-in period from the date of issue, but, it permitted premature encasement to individuals who were 60 years and above.

Interest on these bonds will be taxable under the Income-tax Act, 1961.

Now the Govt. has withdrawn these bonds. This means no more new subscriptions, only old ones will continue.

Demand Status:- Investment advisors say that while it was mostly used by HNIs to invest, the demand for RBI bonds went up significantly over the last couple of months as investors turned risk averse.

Why Recently RBI cutting Repo Rates:– A cut in repo rates not only reduces the rate at which commercial banks borrow from RBI but also leads to a cut in deposit and lending rates for banks. The RBIs move to cut in repo rate has been to push credit growth and demand in the economy in a bid to augur growth in the economy.

2) Steps Take by RBI in the Lockdown to manage the Economic Crisis:-

  1. To begin with, the RBI has cut the Repo rate and reverse repo rate in order to Spur growth by pumping more money in the market. (RBI is incentivising banks to borrow from it at low rates and lend it forward to businesses, yet, on the other, it is disincentivising them from coming back and parking these funds with the RBI.)
  2. The second key thing that the RBI has done is to announce another TLTRO of Rs 50,000 crore but this time it has mandated that 50 per cent of this amount borrowed by the banks must go to small and mid-sized Non-Banking Financial Companies (NBFCs) and Micro Finance Institutions (MFIs).
    Benefits of TLTRO Operations:-  One, it provides more liquidity. But more importantly, it also provides it targeted to those institutions that are most hit by the economic slowdown and, as such, most in need of funds to survive themselves and boost economic activity 
  3. Further, to help the end consumer, especially in the rural sector, small industries, and housing finance companies, All India financial institutions (AIFIs) such as the National Bank for Agriculture and Rural Development (NABARD), the Small Industries Development Bank of India (SIDBI) and the National Housing Bank (NHB), which borrow from the RBI and the market to extend credit to NBFCs and MFIs, will be provided “special refinance facilities for a total amount of Rs 50,000 crore” by the RBI.
  4. On the issue of providing liquidity and fulfilling its role as “the lender of last resort”, the RBI also announced that it will provide more funding to state governments — under the Ways and Means Advances (WMA) facility — as they try to spend to mitigate the economic stress.
  5. Apart from easing liquidity in the system like in the past, the other focus has been to provide an easier regulatory regime.
  6. Given the stress on the system and the demand for cash, the RBI has allowed Scheduled Commercial Banks to reduce their Liquidity Coverage Ratio from 100 per cent to 80 per cent with immediate effect. The LCR essentially mandates the amount of cash that a bank is required to keep with itself. At 100 per cent LCR, a bank would have been required to keep 100 per cent of the net cash it expects to flow out of the bank over the next 30 day.

3)NASA-SpaceX Demo-2 mission: What is special about the ‘Starman suits’?

One of the main objectives of NASA’s commercial crew program is to make space more accessible, in a way that crew and cargo can be transported to and from the ISS easily. Through this program, NASA plans to lower its costs by sharing them with commercial partners such as Boeing and SpaceX, and also gives the companies the incentive to design and build the Commercial Orbital Transportation Servcies (COTS).

Starman Suits( SpaceX Suits) How are they different :- The SpaceX spacesuits are different from other spacesuits typically worn by astronauts because of their sleek design, and are being described as resembling a tuxedo. “Actually, what the SpaceX suits evoke most of all is James Bond’s tuxedo if it were redesigned by Tony Stark as an upgrade for James T. Kirk’s next big adventure. Streamlined, graphic and articulated, the suits are more a part of the pop-culture-Comic-Con continuum of space style than the NASA continuum. These suits are designed by Hollywood designer.

4)Locust attack: How they arrived, seriousness of the problem, and ways to solve it?

What are ‘desert locusts’ doing in non-desert lands?:-

Desert locusts (Schistocerca gregaria), which belong to the family of grasshoppers, normally live and breed in semi-arid or desert regions. For laying eggs, they require bare ground, which is rarely found in areas with dense vegetation. So, they can breed in Rajasthan but not in the Indo-Gangetic plains or Godavari and Cauvery delta.

But green vegetation is required for hopper development. Hopper is the stage between the nymph that is hatched from the eggs, and the winged adult moth. Such cover isn’t widespread enough in the deserts to allow growth of large populations of locusts.

As individuals, or in small isolated groups, locusts are not very dangerous. But when they grow into large populations their behaviour changes, they transform from ‘solitary phase’ into ‘gregarious phase’, and start forming ‘swarms’.

Good rains can sometimes generate just enough green vegetation that is conducive to egg-laying as well as hopper development. This is what seems to have happened this year. These locusts usually breed in the dry areas around Ethiopia, Somalia, Eritrea along the eastern coast of Africa, a region known as the Horn of Africa. Other breeding grounds are the adjoining Asian regions in Yemen, Oman, southern Iran, and in Pakistan’s Balochistan and Khyber Pakhtunkhwa provinces.

The Locust Warning Organisation, a unit under the Agriculture Ministry, had spotted these and warned of their presence at Jaisalmer and Suratgarh in Rajasthan, and Fazilka in Punjab near the India-Pakistan border. Subsequently, there has been arrival of several swarms from the breeding areas.

When July-October is the normal time, how did they arrive so early?
The answer to this question probably lies in the unusual cyclonic storms of 2018 in the Arabian Sea. Cyclonic storms Mekunu and Luban had struck Oman and Yemen respectively that year. Heavy rains had transformed uninhabited desert tracts into large lake where the locust swarms breed.

If left uncontrolled, a single swarm can increase 20 times of its original population in the first generation itself, and then multiply exponentially in subsequent generations.

Apart from the search for food, their movement has been aided by westerly winds that were, this time, further strengthened by the low pressure area created by Cyclone Amphan in the Bay of Bengal. Locusts are known to be passive flyers, and generally follow the wind. But they do not take off in very strong windy conditions.

How can these Pests be Controlled:- Locust control has involved spraying of organo-phospate pesticides on the night resting places of the locusts. 

Indian Institute of Sugarcane Research, Lucknow, advised farmers to spray chemicals like lambdacyhalothirn, deltamethrin, fipronil, chlorpyriphos, or malathion to control the swarms.

Malathion is also included in the list of banned chemicals but has been subsequently allowed for locust control.

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