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The union government introduced three farm bills as part of Agricultural Reforms in September 2020. Recently Farmer Leader has flagged off tractor rally to mark 100 days of farmers protest opposing the proposed three farm bills.

Discuss- What is your opinion regarding the farm bills and farmer’s protest?

SUB-POINTS

1.Pros and cons of proposed bills
2.Challenges associated with bills
3.What is Govt doing regarding the protest ?
4.Is the protest's way appropriate ?

TRY TO GIVE YOUR POINT OF VIEW ON EACH POINT. TO UTILIZE YOUR OWN TIME IN A GAINFULL MANNER JUST PARTICIPATION SHOULD NOT BE THE PRIMARY GOAL GENTLEMEN.

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#GD_Material

◆The union government introduced three farm bills as part of Agricultural Reforms in September 2020.

Three Farm Bills and Controversy

The Bills include:

●The Farmers’ Produce Trade and Commerce (Promotion and Facilitation)
●The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services
●The Essential Commodities (Amendment) Act

The Farmers’ Produce Trade and Commerce (Promotion and Facilitation)
◆It aims to create alternate marketing channels where farmers and traders (big business companies or exporters) have the freedom to sell and purchase farm produce oustide the registered 'mandis' under states' APMCs.
◆Promotes barrier-free inter-state and intra-state trade of farmers' produce.
◆Reduces marketing/transportation costs and help farmers in getting better prices
◆Prices of the produce also become competitive.
◆Provides a facilitative framework for electronic trading.

Opposition
●In mandies, State governments levy fees and taxes and middlemen collect a lot of charges from farmers.
●States worry that they would lose revenue as they won't be able to collect 'mandi fees' if farmers sell their produce outside registered APMC markets.
●Farmers fear it may eventually end the MSP-based procurement system, but nowhere bill says anything about ending or phasing out of MSP.
●Electronic trading like in e-NAM uses physical 'mandi' structure. What will happen to e-NAM if 'mandis' are destroyed in absence of trading?

The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Act:
●Allows farmers and buyers (agribusiness firms, processors, wholesalers, exporters or large retailers) can enter into written contract prior to production for the sale and purchase of the produce at a fixed price in future.
●The contract must include the guaranteed price agreed to the farmer and any other additional price.
●In India, marginal and small farmers account for 86% of total farmers. Marginal and small farmers, with land less than five hectare 
to gain via aggregation and contract.
●Transfers the risk of market unpredictability from farmersto sponsors (buyers).
●Enables farmers to access modern technology and get better inputs.
●Reduces the risk of fluctuating market price and demand for the farmer.
●Buyer can reduce the risk of non-availability of quality produce.
●Reduce cost of marketing and boost farmer's income.
●Farmers have the freedom in direct marketing by eliminating intermediaries for maximum price realisation.
●Effective dispute resolution mechanism with redressal timelines.

#GD_Material

Contd....

Opposition
◆In the contract farming System, the farmer will be the weaker player in terms of his ability to negotiate what he needs.
◆The sponsors may not show interest to deal with a multitude of small and marginal farmers
◆The sponsors, who are big private companies, exporters, wholesalers and processors, will have an edge in disputes.
◆The conciliation system would leave farmers at the mercy of civil servant, who heads the conciliatory board.

The Essential Commodities (Amendment) Act
●The act seeks to impose stock limits only if there is:
●a 100% increase in retail price of horticultural produce;
●a 50% increase in the retail price of non-perishable agricultural food items. 
●Removes commodities like cereals, pulses, oilseeds, onion and potatoes from the list of essential commodities. The act will do away with the imposition of stock limits on such items except under "extraordinary circumstances" like war, famine, extraordinary price rise and natural calamity of grave nature.
●Attracts FDI in agriculture sector as it will remove fears of private investors of excessive regulatory interference in business operations
●It will boost investment in cold storages and modernization of food supply chain.
●To help both farmers and consumers by bringing in price stability.
●To create competitive market environment by preventing wastage of these produce.

Opposition
◆Price limits for "extraordinary circumstances" are so high that they are likely to be never triggered.
◆Big companies will have the liberty to stock commodities. It means they will dictate terms to farmers which may lead to less prices for the cultivators.
◆The recent decision on export ban on onion creates doubt on its implementation.

Way Forward
◆There is a critical need for alleviating the fears of farmers as regards the continuation of the MSP system and procurement of food grains in case of distress and also make them aware of the options of selling the produce other than at the mandies is a boon to them.
◆Government declares Minimum Support Price (MSP) for 22 crops before the sowing season based on the recommendations of the Commission for Agricultural Costs and Prices (CACP), the Department of Agriculture and Co-operation. Hence the Government should give legal backing to MSP rather than just continuing it as an administrative exercise or a government policy.
◆Effective legal recourse shall be available to the farmers.

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#DAILY_PRACTICE #WAT_SET

1.Borrow
2.Diagram
3.Terrain
4.Print
5.Table
6.Station
7.Propose
8.Ceremony
9.Elevation
10.Volume

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#DAILY_PRACTICE #SRT_SET

1.You have a teenage son and he has fallen into bad habits of drinking and smoking.How will u change his perceptions and beliefs to leave such habits ?

2.Your two neighbours are facing a conflict due to the parking space in the society,How will u make disagreement between them in a constructive way ?

3.You are having an important exam for which you have been preparing for one year and on the day of exam protestors blocked the way on which u are travelling .You....

4. He had his brother's marriage ceremony and also he had an exam on the same day. He_____

5. He had his sister's marriage ceremony and also had an Army administrative inspection on that day. He_____

6. He was the captain of the volleyball team and met an accident a day before in which he was severely injured. He_____

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#DAILY_PRACTICE
#TAT_SET201

Important TAT image for all Entries.
Try to write within prescribed time i.e. 4 minutes.
Be honest with your preparation and attempt this image and write a desirable story.

(For better practice,Write the story on A4 paper within prescribed time.)

Healthy and constructive reviews are welcome.

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#Defence_Exams_Notes

FIRST WOMENS IN NEWS 2019-20

◆ First Female Flight Commander
Shalija Dhami

◆First Woman Flight Engineer of Indian Air Force
Hina Jaiswal

◆First Woman To Qualify To Go To Day Missions
Bhawana Kanth

◆First Indian Woman Who Flew a Fighter aircraft Solo
Avani Chaturvedi

◆First Woman Fighter Pilot to Undertake Missions by day on Hawk
Mohana Singh

◆India's First Female Military diplomat
Anjali Singh

◆First Woman Pilot of Indian Navy
Shivangi

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#Editorial_Analysis #GD_Material

Commemorating change, changing commemoration

✔️Context

◆International women's day celebrated every year on March 8th or 10th is a reminder of the struggles of women factory workers, which was organised by socialist movements as “international women’s day”.

◆From the 1920s onwards, it began to be celebrated annually by communist parties, first in the Soviet Union and then in China.

◆Later in 1977, the United Nations established "International Women’s Day" and In India, awareness about women's day started in the 1980s.

✔️Savitribai Phule’s legacy

◆In recent years, Dalit and Bahujan feminists in India want to celebrate Savitribai Phule legacy on this day, which is ignored by upper-caste histories of women’s rights.

◆Born in 1831, Savitribai was colonial India’s first woman teacher and she worked towards social justice along with her husband Jyotiba Phule.

◆The Bahujan-feminists emphasising the importance of access to a non-Brahmin form of education which played a greater role in transforming the gender, caste and labour structures in our society are of the view that Women's day to be celebrated on March 10th of every year, commemorating the death of Phule on March 10, 1987.

✔️Shaheen Bagh, the lockdown

●We need to rethink women's day celebrations.

●A year ago, the protest in Shaheen Bagh against the discriminatory Citizenship (Amendment) Act (CAA) led to a violent end and riots against Muslim property and lives as the protests had been led by Muslim women.

●To end the peaceful protest, many leaders including young women and students were arrested on grounds of inciting the riots.

●In March, the lockdown announces in response to the pandemic led citizens feel the silent, empty streets, images of sparkling blue rivers, the smell of clean air, loud birdsong, and animals emerging from their hidden habitats. At the same time, migrant workers and their families were forced to walk hundreds of kilometres to their rural homes in search of food, shelter and care.

●Daily wage workers including women were hard-pressed to meet their basic survival needs.

✔️The home in focus

◆The pandemic was an “inequality virus”.

◆During the lockdown, the home became the centre focus, since many workers had to work from home, children had to study from home, and even people who had lost their jobs had to stay at home.

◆In “normal” times, Men were not aware of the household chores as they were always granted with spoonfeeding, during lockdown men were able to realise the undue care and responsibility a women holds and were ready to condemn domestic violence that had been going on for ages.

◆During Lockdown, Questions were raised about whether the absence of paid domestic workers in middle-class families will make the men take on domestic responsibilities? whether the women care work and housework be given due recognition.

◆Unfortunately, as life returns to the new “normal”, hardly women are given any recognition though they were the life saviours during the time of crisis.

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#Editorial_Analysis #GD_Material

Contd.........

✔️New movements

◆From the State of Uttar Pradesh in particular, many cases of extreme sexual assaults and murder of Dalit girls who stepped out to work are reported, regardless of actions taken by the government, The only silver lining (as with the Hathras rape case) has been the leader of a new generation of Dalit women demanding accountability from the state.

◆This winter also witnessed the birth of a new social movement during the farmers protest against new agricultural laws.

◆Not only men but some women spoke out about their rights as women farmers during the protest and offered new lessons regarding the importance of the food we eat.

✔️Conclusion

●Not sure of what Savitribai would have said on March 10, 2021, to Shaheen Bagh dadis, to students, mothers and farmers, to the families of the victims of the violation, but it's for sure that she was a real-life hero in breaking cast codes and working in new Satyashodhak Samaj which was casteless.

●Thus, women still need to be given due recognition for their contribution to society. This women's day let us provide due recognition to women and move a step ahead towards gender equality.

✔️Reference

https://thg.page.link/91vFCYuckyocWcwAA

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#Editorial_Analysis #GD_Material

Railways and a question of transparency

✔️Context

◆The objective of doing away with a separate Budget for the Railways, namely, shifting the focus away from it, has been achieved in this budget.
◆Though the union budget concentrates on different issues ignoring railways, The transportation issues faced cannot be hidden.

✔️Finances are out of whack

●Based on statements given by the CEO and Chairman of the Railway Board, the performance of the Railways on the freight front is going good and in fact, freight loading in January 2021 was the highest ever.
●As per a recent press report, freight earnings in 2020-21 are likely to be more than in 2019-20 despite the COVID-19 pandemic
●The achievements claimed by the Railway board are not worthy, because the freight earnings during the entire year are projected to be ₹1,24,184.00 crore in the Revised Estimates for 2020-21, which is lower than what was achieved in 2018-19 (₹1,27,432.72 crore).
●Further, increased freight revenues were due to freight traffic having a free run due to the cancellation of most regular passenger services due to COVID-19.
●The Operating Ratio (OR), the ratio of working expenses to revenues, has been artificially kept below 100% by making less-than-required provision for pension payments during 2019-20 and 2020-21 to hide reality.
●While the official figures of OR are 98.36% for 2019-20 and 96.96% for 2020-21, the actual OR works out to 114.19% and 131.49% respectively, if adequate pension payments are made.
●Technically, the Indian Railways are in trouble, altering the statistics cannot change the reality.
●The first time, the Indian Railways were unable to provide for the Pension Fund, both for 2019-20 and 2020-21, totalling ₹78,119 crores.
●A loan has been taken by the railway board from the Central Exchequer to meet the shortfall in pension fund contribution.
●The shortfall in revenues during 2020-21 can be attributed to the pandemic, However, the shortfall amounting to ₹27,642 crores during 2019-20 (when there was no COVID-19) is a serious concern.
●The downslide in railways had started even before the pandemic, the passenger and freight earnings in 2019-20 were less than in 2018-19, Thus indicating that Railway finances are out of whack and the pandemic has no role in it.

✔️Immediate challenges

◆There is a mismatch between increased earnings and expenditure towards staff costs and pension payments.
◆While the passenger and freight revenues increased by 84.8 % from 2010-11 to 2019-20, the staff and pension costs have increased by 157%.
◆In 2010-11, the staff plus pension costs were only 55.7% of the traffic earnings, but now they had shot up to 77.5% of the traffic earnings.
◆The increase in the staff and pension costs is due to the implementation of the Central Pay Commission recommendations, a 10-yearly feature.
◆The ministry of railways would receive via further blow in the next (Eighth) Pay Commission around 2025-26.
◆Therefore, the immediate challenges are increasing freight front revenues and a drastic reduction in the number of employees, there being no way to reduce the number of pensioners in the short run.
◆To increase revenues, two Dedicated Freight Corridors (DFCs), need to be completely operational by 2022.
◆Freight traffic consists mainly of coal, more than 50% of earnings can be contributed to it.
◆A shift to a cleaner source of energy like solar in future would reduce the demand for coal transportation in future.
◆India being a signatory to the 2015 Paris Agreement, has to reduce carbon emissions in a time-bound manner.
◆The Railways can consider adopting the roll-on roll-off model of transporting loaded trucks on the rail on the DFCs, which apart from increasing revenues, would help to reduce the overall carbon footprint.
◆The announcement of recruiting 1.5 lakh staff is simply baffling as it would lead to increased staff and pension cost.
◆There have been suggestions to corporatize the Railways’ Production Units and outsource the medical services.

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#Editorial_Analysis #GD_Material

Contd...........

◆The government after discussing the issues with various stakeholders needs to firm up its policies.

◆On one side the government is thinking about bringing all the railway departments into one head and reducing departmentalism while on the other hand, it's thinking of privatisation of passenger and freight services. These are conflicting moves, akin to driving a car with one foot on the accelerator and the other on the brakes.

✔️Need for public scrutiny

●There is a need for detailed public scrutiny of the affairs of the railways.

●An annual report called ‘Indian Railways Report’ should be placed in Parliament every year detailing the physical and financial performance of the Railways, identifying the challenges and plans for the future to meet the country’s rail transport needs along with the economic survey.

✔️Conclusion

◆The Railways are facing unprecedented fundamental organisational issues and financial distress. The government instead of hiding the reality has to be more clear and transparent so that required actions can be taken and revenue could be increased.

✔️Reference

https://thg.page.link/FbnfpTTz3k2KWzVf6

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#Defence_Exams_Notes #Important_notes_ssb

✔️Overseas Citizen of India

The Ministry of Home Affairs defines an OCI as a person who:

•Was a citizen of India on or after 26th January 1950; or

•Was eligible to become a citizen of India on 26th January 1950; or

•Is a child or grandchild of such a person, among other eligibility criteria.

◆According to Section 7A of the OCI card rules, an applicant is not eligible for the OCI card if he, his parents or grandparents have ever been a citizen of Pakistan or Bangladesh. The category was introduced by the government in 2005.

◆The Government of India via Citizenship (Amendment) Act, 2015 merged the Person of Indian Origin (PIO) category with OCI category in 2015.

✔️Non Resident Indian

●A Non-Resident Indian (NRI) means a person resident outside India who is a citizen of India or is a person of Indian origin.

●An Indian citizen residing outside India for a combined total of at least 183 days in a financial year is considered to be an NRI.

●NRIs enjoy voting rights and are required to pay and file the income tax return on their Indian income like resident Indians.

●NRI is more of a technical classification for taxation purposes and investment purposes.

●However, in case an NRI wishes to take up foreign citizenship, he/she will have to give up Indian citizenship as the Indian constitution does not allow dual citizenship.

●A person cannot hold Indian as well as foreign citizenship simultaneously.

✔️Foreigner

◆As per the the Foreigners Act, 1946, foreigner means a person who is not a citizen of India.

◆The Fundamental Rights guaranteed by Articles 14, 20, 21, 21A, 22, 23, 24, 25, 26, 27 and 28 are available to all persons whether citizens or foreigners. 

◆The Fundamental Rights guaranteed by Articles 15, 16, 19, 29, and 30 are available only to citizens of India.

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#Know_Your_Navy

Vice Admiral SN Ghormade, assumed the appointment of Deputy Chief (Operations & Training), Headquarters Integrated Defence Staff on 08 Mar 2021. Prior to this he was holding the appointment of Controller Personnel Services in IHQ MoD (Navy).

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#INTERNATIONAL_CURRENTAFFAIRS #GD_Material

The civil war in Ethiopia

✔️Context

●Ethiopia is in the grip of civil war due to military violence in its Tigray region.

The major reason for the conflict:

•Conflict in the Tigray region began in late 2020 when Prime Minister Abi Ahmed launched an aggressive campaign to oust the province's ruling party TPLF. It is noteworthy that the Ethiopian government of Tigray's capital Mekele wants to take control of the.

•Internal conflict in Ethiopia has resulted in 52,000 casualties and displacement of over 2 million so far, of which more than 60,000 have taken refuge in Sudan's eastern border. This has led to the influx of military personnel from Sudanese and Eritreans along the northern frontier of Ethiopia.

•Currently, Ethiopia is attempting to deal with its domestic emergency. At this stage, the challenge is to achieve a military conflict-free environment, address increased displacement, support basic needs for civilians in the face of the risk of famine, and intensify humanitarian aid in conflict-prone areas.

●Cities in the northern Gondar Zone, such as Welkait, which have been under the control of TPLF forces for decades, would need social, economic revival support after the conflict.

✔️About the Tigrayan People's Liberation Front (TPLF)

◆Tigrayan People's Liberation Front The Tigrayan People's Liberation Front (TPLF) was established in 1975 as a military organization. The Tigrayan People's Liberation Front is reportedly fighting against the dictatorial government of Ethiopia to protect the interests of the people living in the Tigray region.

◆Most people in Tigray are Ethiopian Orthodox Christians. Christians have been living here for 1,600 years. The predominant language here is Tigrinya. It is a Semitic dialect that is spoken by at least 7 million people worldwide.

◆The TPLF waged an armed struggle against the then military government of Ethiopia in the year 1991, as a result of which it succeeded in removing the military dictatorial government from power.

◆It was only in 1991 that TPLF leader Meles Zenawi took over as interim president and in 1995 became the first elected Prime Minister. Meles Zenawi remained in power until 2012 and is largely seen as the architect of the country's ethnic-federal system.

✔️About Ethiopia

◆Ethiopia is an Ethiopian landlocked country located in the Horn of Africa. The geographical area of ​​East Africa is called the Horn of Africa. It is the easternmost extension of African land, including Djibouti, Eritrea, Ethiopia, and Somalia. It is noteworthy that all these countries are not only geographically identical but also have cultural similarities.

◆Ethiopia borders Djibouti, Somalia, Eritrea, Kenya, and Sudan.

◆The capital city of Ethiopia is Addis Ababa, which is the largest city here.

✔️Students Approach

◆Peace-building, post-conflict reconstruction and transitional justice are not possible in this country without a clear framework. The civil war in Ethiopia impacts the Horn of Africa region, which already suffers from conflicts, uneven economic development, border disputes, food insecurity, climate change, an uncertain political situation and a severe refugee crisis.

◆The Tigray region of Ethiopia needs both political and economic reforms to begin the post-conflict reconstruction work. The country's humanitarian crisis gives rise to long-term concerns. In such a situation, the free and safe and unhindered access of the United Nations and its partner organizations to Ethiopia is essential for meeting the security and humanitarian needs.

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#Important_notes_ssb #Editorial_Analysis #Personal_Interview #GD_Material

Defence Budget

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#Important_currentaffair_for_SSBinterview #INTERNATIONAL_CURRENTAFFAIRS #GD_Material #Important_notes_ssb_Lecturette

Chinese cyber-attacks on India{1/2}

✔️Context

◆On 1st March 2021, Nitin Raut, Maharashtra's Power Minister, confirmed that a 'New York Times' report citing the massive grid failure in Mumbai on 12th October 2020 resulted from a Chinese cyber-attack. He also confirmed that the inquiry initiated by his team in this regard is complete, and the report would be released soon.

✔️Highlights of the NY Times Report

●Chinese hackers installed malware in the Maharashtra Electricity Supply company's control system that supplies 1000 MW to Mumbai every day.

●Besides this, other power companies run by the Adani Group and Tata Group were also paralysed.

●At 10 am on 12th October 2020, the attack began, and to this effect, the electricity supply to the city was turned off.

●As a result, trains ground to a halt and surgeries in hospitals were stopped, among many other casualties. The issue could be resolved by the afternoon. 

●The cyberattack unfolded at a time when the Indian Army was facing off with PLA in Ladakh.

●As per the US firm's malware tracing, the malware was not activated, indicating a small proportion of malware caused the Mumbai power outage.

●The preliminary investigation carried out by the Maharashtra cyber-attack department traced the malware outskirts of Mumbai, meaning that 'state sponsored' Chinese hacker groups had targeted various Indian power centres.

✔️What is cybercrime?

◆Cybercriminals are a new genre of criminals that emerged in recent times. The hackers get into personal computers and steal information, such as – account numbers, passwords etc. They developed expertise in crimes such as ATM frauds, Credit/Debit card rip-offs, cloning of mobile sim cards etc.

✔️Some Stats

◆As per stats, global cybercrime has defrauded almost one-trillion US Dollars; the most common cyber frauds include intellectual property theft, economic espionage, and ransom attacks.

◆Nearly 7% of the total cyber losses accounted for IP theft and financial crime, posing the greatest threat to companies. 

✔️What is the concern with the Chinese cyber-attack on India?

●If reports are to be believed, it is a matter of grave concern. There have been instances where China made attempts to steal research information from Indian vaccine producers following Mumbai's electric grid paralysis.

●Attacking India's India's vaccine capability is diminishing the world's hopes for genuine research and contribution. These incidences are examples of China's power to hurt and resorting to its usual tricks of theft and thuggery.

●According to the Counterfeit Report, '80 % of the world's counterfeits are produced by China'. As China cannot fight conventional wars against India, it relies on unconventional means such as cyber-attacks.

Note: Like, the information and communication space, cyberspace is no different and is a subset of networks and communication systems.

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Chinese cyber-attacks on India{2/2}

✔️Consequences of stolen information 

◆The US officials accuse Chinese hackers of stealing information about Chinese Human Rights activists and shifted focus in 2020 to acquire coronavirus vaccine research information at the behest of the Ministry of State. 

◆These revelations came after the United States news aiming to curb China's efforts to steal American technological know-how in response to China's attempt to hack a Massachusetts biotech firm researching a vaccine in January 2020.

◆Later in May 2020, California's diagnostic firm developing virus testing kits was attacked. 

◆Cyber-crime has mutated much like the Chinese virus due to China's active encouragement like that of cronies. Therefore, to cyber warfare, China poses a more significant threat to the nation's critical infrastructure. 

◆In 2010, the malicious computer worm first uncovered targeted supervisory control and data acquisition (SCADA) systems, leading to substantial damage to Iran's nuclear program. It was the first example of cyber warfare.

◆Cyberwarfare possesses and provides far more areas than the military and intelligence gathering, including: 

•Technological research & development and innovation capabilities
•Information technology industry companies
•Influences of internet websites
•Internet diplomacy and foreign policy capabilities
•Cyber military strength
•Cyber comprehensiveness of cybersecurity

◆Cyberwarfare is strategic warfare in the information and has no defined boundaries and is like nuclear warfare in the 20th century. Although there are many Chinese speakers worldwide, less than 2% of all the websites are in Chinese languages, making it difficult to perceive. Therefore, it urgently needs a more comprehensive and objective assessment of China's cyber power.

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#Important_notes_ssb_Lecturette

Cryptocurrency{1/2}

◆Recently the Supreme Court has struck down a ban by the Reserve Bank of India (RBI) on banks and financial institutions from dealing with cryptocurrency holders and exchanges. In 2018, the RBI had banned various banks from dealing with virtual currency exchanges and individual holders on the grounds that these currencies had no underlying fiat (a formal authorization).

◆After the circular of RBI in 2018 which ban crypto-currency, The Internet and Mobile Association of India (IAMAI) had challenged the RBI’s powers to bar banks and financial institutions from dealing in such digital currencies.

✔️Supreme Court on CryptoCurrency in India

About Cryptocurrencies:

●There is no globally accepted definition of virtual currency. Few agencies have called it a method of exchange of value, while others have labeled it a goods item, product or commodity.

●The founder of bitcoin and the underlying technology called blockchain, Satoshi Nakamoto has defined bitcoins as a new electronic cash system that’s entirely peer-to-peer with no trusted third party.

●This means that all users of currencies will be able to keep track of the transactions taking place.

●Virtual currency is an umbrella term for all kind of non-fiat currency traded online. They are mostly created, distributed and accepted in local virtual networks.

●On the other hand, Cryptocurrencies have an extra layer of security, in the form of encryption algorithms.

●Most cryptocurrencies now operate on blockchain technology which allows everyone on the network to keep track of the transactions which are occurring globally.

✔️Reason for the ban by RBI

●Lack of any underlying fiat.
●Excessive volatility in their value.
●Lack of information on their design, use and operation.
●They may seriously disrupt the business models of commercial banks.
●The anonymous nature of cryptocurrency which goes against global money-laundering rules.
●Risks and concerns associated with virtual currencies regarding data security and consumer protection.
●It can impact on the effectiveness of the monetary policy. 

✔️Internet and Mobile Association of India (IAMAI) arguments against the ban:

◆RBI action was outside its purview as a non-fiat currency is not a currency as such.

◆There were no studies conducted either by the RBI or by the central government.

◆The ban was solely made on moral grounds and RBI should have adopted a wait-and-watch approach as taken by other regulators like Securities and Exchange Board of India (SEBI).

✔️Supreme Court’s judgment on Cryptocurrency:

◆The Court said that till date RBI has not come out with a stand that any of the entities regulated by it, have suffered any loss or adversely effected due to Virtual Currency exchanges.

◆Hence, the RBI circular is “disproportionate” as it is short on the following five-prong test to check proportionality

◆The direct and immediate impact upon fundamental rights.

◆The larger public interest should be ensured.

◆The necessity to restrict citizens’ freedom.

◆Inherent harmful nature of the act prohibited

◆Possibility of achieving the same objective by imposing a less drastic restraint.

◆The court also states that RBI did not consider the availability of alternatives before issuing the circular.

◆The court said that RBI could not be blamed for not adopting a “light-touch” approach as adopted by other countries, as there could be no comparison with other countries such as the US, the UK, Japan, or Singapore were developed economies.

◆Further, the court also pointed out the Centre’s failure to introduce an official digital Currency despite two draft Bills.

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#Important_notes_ssb_Lecturette

Cryptocurrency{2/2}

✔️Effects of Supreme court judgement on Cryptocurrency:

●It will help in the incorporation of blockchain technology.

●Cryptocurrencies can act as Alternative Investments so as to hedge global volatility in the Finance market.

●It can be a crucial part of the Industrial revolution 4.0.

●It is also estimated that blockchain will generate $3.1 trillion in new business value by 2030 and allowing cryptocurrency will enable India to be part of this.

●For India to become a world power, embracing emerging technologies like cryptocurrency and blockchain is a must.

✔️Status of Virtual Currencies in the world:

◆Organizations across the globe have issued the warning while dealing with virtual currencies.

◆A blanket ban of any sort could potentially push the entire system underground which in turn would mean that there will be no regulation.

◆Countries such as China, Russia, and Vietnam have placed a complete prohibition on using cryptocurrency.

●Whereas countries like the US, UK, Canda, Singapore, and Australia have accepted the use of Virtual Currency in some form or the other.

✔️Future Outlook

●The relief for virtual currency investors and businesses may be only temporary as the Centre govt.
In a draft law has proposed to ban all cryptocurrencies except a state-issued one.

●The Centre may introduce the bill to permanently ban the cryptocurrencies and to set up the basic infrastructure required to issue state-owned cryptocurrency and the digital rupee.

●But rather than imposing a blanket ban, the Govt. should set up a new expert regulatory body with capability in technology, economics and finance to deal with all aspect regarding cryptocurrency.

●RBI may come up with a new framework or regulation that deals with the reality of these technological advancements.

●The govt should also designate virtual currency intermediaries as reporting entities under the Prevention of Money Laundering Act (PMLA).

●A vibrant cryptocurrency segment could add more value to India’s financial sector. Thus, in the era of growing technological innovation in the financial sector, it is critical to strengthen the regulatory frameworks of India.

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