30th November 2021| UPSC CURRENT AFFAIRS |
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30th November 2021 Current Affairs MCQs
What the Omicron variant means for India
- It could pose a threat to progress made in the COVID-19 fight, but additional information is needed
- The continued decline in COVID-19 casesfollowing the intense second wave in Indiahas led to hope that a return to normalcy might be near. Across the country, emboldened by the fact that the festival season did not lead to a steep rise in cases, restrictions have eased and public behaviour is largely returning to normal.
- Situation now
The low number of cases currently in India, even as cases are rising across much of Europe, appears largely attributable to two factors. First, seroprevalence studies indicate that a large proportion of the population has already been exposed to the virus providing some level of protection to subsequent infections. Second, the immunisation campaign has gained momentum. Approximately 44% of Indian adults have been fully vaccinated and 82% have received at least one dose. What is more, scientists believe that prior infection followed by one or two doses of vaccination may have a larger protective effect than two doses of the vaccination alone.
While vaccine-derived protection against symptomatic infection is expected to decay with time, current research suggests that breakthrough infections in fully vaccinated individuals are reduced in intensity and duration, compared to cases in individuals who have not been vaccinated. This holds for the Delta variant as well. Other variants have raised concerns but none of them has appeared to be significantly more worrying than the Delta variant, at least until now.
What WHO says
- A new variant of the SARS-CoV-2 virus was recently identified in Botswana. Called the Omicron variant, early evidence suggests that it may be responsible for the steep rise of cases in the Gauteng province of South Africa. In this region, 90% of samples from the past few weeks have been of the Omicron variant. This variant has a large number of mutations. Some of them are cause for serious concern because they may allow the new variant to evade immunity obtained from a past infection or via a vaccine. The World Health Organization (WHO) has recently labelled this variant as a ‘variant of concern’.
While the emergence of the new variant is concerning and requires extreme vigilance, there are several questions that remain unanswered at the moment. Is the variant more transmissible? Can it evade the immune system? And is the variant associated with more severe disease outcomes?
The possibility of a new, more transmissible variant of the SARS-CoV-2 virus has, of course, been the principal worry of epidemiologists. Some other recent variants, with a more limited repertoire of mutations, have raised concerns briefly, but have not risen to the level of being named a variant of concern so far. What is concerning here is that cases of the new variant have risen so sharply as to suggest that it may far outstrip the Delta variant in its ability to infect people. There are no reliable estimates of just how much more transmissible the Omicron variant is compared to previous strains of the virus. But even crude calculations suggest it could be much larger than for those strains.
When new variants can evade immunity obtained through immunisation and prior infections, there is a greater chance for breakthrough cases and further transmission. WHO has recommended studies to understand the degree to which the immune system is evaded by the Omicron variant. This is a key question for India given the high proportion of individuals with some level of immunity, mostly from infection. If these mutations do lead to greater immune escape, vaccines and treatments like monoclonal antibodies might need to be reformulated.
Luckily, RT-PCR tests should still detect the Omicron variant.
Addressing the variant
Right now, we know very little about whether the Omicron variant might lead to more severe forms of COVID-19, both in vaccinated and unvaccinated individuals. This is clearly a priority for research. Evidence related to increased severity associated with other variants, such as the Delta variant, remains largely inconclusive.
Where did the Omicron variant come from? Viruses mutate all the time and SARS-CoV-2 is no exception. What is unusual is the very large number of mutations that the Omicron variant has accumulated. This is likely a consequence of a chronic infection in an immunocompromised patient, such as one infected with HIV. A strong immune response can ultimately eliminate the virus. However, in a weakened immune system the virus will continue to multiply and mutate, changing its form to evade immune response. Given this, prioritising the elderly and immunocompromised for a future additional dose would make sense.
- While a number of nations have already closed their doors to travellers from South Africa, epidemiologists worldwide recognise that these measures can only offer temporary relief. Given that a case was found in Hong Kong in a traveller from South Africa a full four days into a mandatory quarantine, and that this patient may have infected another individual who turned positive some days later, it seems very likely that cases may have already crossed borders without being detected. Israel has also reported cases, with one of them, a 32-year-old woman, already triple vaccinated with the Pfizer vaccine before testing positive. The symptoms in this case were mild.
As long as the virus circulates, the possibility remains that new variants could emerge. The best option is to reduce case numbers. For this, vaccination is an especially powerful tool. Even a single dose of vaccine can reduce dramatically the risk of hospitalisation or a worse outcome; two doses do even better. However, the current inequity in vaccine distribution means that this means of control is out of reach of most in lower and middle-income countries. While many rich countries are now arranging for booster doses to safeguard their populations, even younger and less vulnerable individuals, this policy comes at the cost of the rest of the world, where vaccine coverage remains abysmally low. More than 60 countries have vaccinated less than 25% of their population, including South Africa. It is these regions that hold the most potential for a new, more transmissible variant. Equity in the distribution of vaccines is an urgent global public health need, quite apart from being ethically and morally the right thing to do.
The Director of the Wellcome Trust, Sir Jeremy Farrar, has in a tweet, said, “South Africa needs to be praised, offered whatever support is needed and acknowledged for the quality of speed of public health and genomic science in South Africa, sharing the data immediately, supporting the region and the world….” We concur and urge that India and other countries should learn from the South African experience, making its data available in real time for the world to study, and exhibiting the highest levels of transparency. At present, we do not know enough about the variant to truly understand the potential risk that it might pose, but — as with all such things — preparing adequately for an uncertain future is key.
Brian Wahl is an Assistant Scientist at the Johns Hopkins Bloomberg School of Public Health, U.S.; Gautam I. Menon is a Professor at Ashoka University, Sonepat and at the Institute of Mathematical Sciences, Chennai. The views expressed are personal
No proposal to recognise Bitcoin as a currency: FM Nirmala Sitharaman
- he also informed the House that the government does not collect data on Bitcoin transactions.
- The government has no proposal to recognise Bitcoin as a currency in the country, Finance Minister Nirmala Sitharaman said in a reply to the Lok Sabha on Monday.
She also informed the House that the government does not collect data on Bitcoin transactions.
Whether the government has any proposal to recognise Bitcoin as a currency in the country, the Finance Minister said “No, sir”.
country, the Finance Minister said “No, sir”.
Cryptocurrency exchange Coinstore enters India despite pending curbs on trade
Bitcoin is a digital currency that allows people to buy goods and services and exchange money without involving banks, credit card issuers or other third parties.
It was introduced in 2008 by an unidentified group of programmers as a cryptocurrency as well as an electronic payment system. It is reportedly the first decentralised digital currency where peer-to-peer transactions take place without any intermediary.
Meanwhile, the government plans to introduce the Cryptocurrency and Regulation of Official Digital Currency Bill 2021 in the ongoing Winter Session of Parliament. The Bill seeks to ban all but a few private cryptocurrencies to promote underlying technologies while allowing an official digital currency by RBI.
The uncertainty around cryptocurrency
- In reply to another question, Ms. Sitharaman said, Ministries and Departments have spent ₹2.29 lakh crore as capital expenditure during the April-September period of the current fiscal.
- This is 41% of the Budget Estimate (BE) of ₹5.54 lakh crore for 2021-22. The actual expenditure during current fiscal is about 38% higher than the corresponding expenditure in FY 2020-21, she said.
To accelerate capital expenditure for creation and upgradation of infrastructure in the economy, Government of India had launched the National Infrastructure Pipeline (NIP) with projected infrastructure investment of ₹111 lakh crore during the period 2020-2025 to provide world-class infrastructure across the country and improve the quality of life for all citizens.
NIP was launched with 6,835 projects, which has expanded to over 9,000 projects covering 34 sub-sectors. NIP is expected to improve project preparation, attract investments into infrastructure and play pivotal role in economic growth, she said.
National Monetization Pipeline (NMP) was also launched on August 23, 2021 to unlock the value of investments in public sector assets by tapping private sector capital and efficiencies for delivering infrastructure services, she said, adding, the monetisation proceeds are envisaged to be ploughed back to augment existing/create greenfield infrastructure to boost the economy.
- Subsequently, she said, Gati Shakti (National Master Plan for Infrastructure Development) was launched on October 13, 2021 as a digital platform to bring Ministries/Departments together for integrated planning and coordinated implementation of infrastructure connectivity projects.
Subsequently, she said, Gati Shakti (National Master Plan for Infrastructure Development) was launched on October 13, 2021 as a digital platform to bring Ministries/Departments together for integrated planning and coordinated implementation of infrastructure connectivity projects.
It will also facilitate the last mile connectivity of infrastructure and also reduce travel time for people, she added.
On inflation, the Finance Minister said price situation of major essential commodities is being monitored by the government on a regular basis and corrective actions are taken from time to time.
“The uptrend in inflation has been largely led by exogenous factors viz. increased international prices of crude oil and edible oils which have an impact on domestic inflation due to India’s import dependence on these items,” she said.
The rise of WPI inflation is also mostly driven by ‘fuel and power’ and manufactured products inflation, once again driven by increased global prices of crude oil and increase in international commodity/input prices, she said.
Several supply side measures have been taken by the government to curb the inflationary pressures, she said.
To check the petrol and diesel prices, Ms. Sitharaman said, the Central government has reduced Central Excise Duty on Petrol & Diesel by ₹5 and ₹10 respectively with effect from November 4, 2021.
“In response many Sate governments have also reduced Value Added Tax on petrol and diesel. Consequently, retail prices of petrol and diesel have sobered down,” she said.
As an additional measure to control prices, India has agreed to release five million barrels of crude oil from its Strategic Petroleum Reserves, she said, adding, this release will happen in parallel and in consultation with other major global energy consumers including the USA, People’s Republic of China, Japan and the Republic of Korea.
Omicron poses ‘very high’ global risk, countries must prepare: WHO
- The heavily mutated Omicroncoronavirus variant is likely to spread internationally and poses a very high risk of infection surges that could have “severe consequences” in some places, the World Health Organization (WHO) said on Monday.
No Omicron-linked deaths had yet been reported, though further research was needed to assess its potential to resist vaccines and immunity induced by previous infections, it added.
Anticipating increased case numbers as the variant, first reported last week, spreads, the U.N. agency urged its 194 member states to accelerate vaccination of high-priority groups.
“Omicron has an unprecedented number of spike mutations, some of which are concerning for their potential impact on the trajectory of the pandemic,” the WHO said.
“The overall global risk …is assessed as very high.”
Tedros Adhanom Ghebreyesus, WHO director-general, said Omicron’s emergence showed how “perilous and precarious” the situation was.
“Omicron demonstrates just why the world needs a new accord on pandemics,” he told the start of an assembly of health ministers expected to launch negotiations on such an agreement.
“Our current system disincentivizes countries from alerting others to threats that will inevitably land on their shores.”
The new global deal, expected by May 2024, would cover issues such as sharing of data and genome sequences of emerging viruses, and of any potential vaccines derived from research.
Scientist Richard Hatchett, CEO of the Coalition for Epidemic Preparedness Innovations (CEPI), a foundation that funds vaccine development, said Omicron’s emergence had fulfilled predictions that transmission of the virus in areas with low vaccination rates would speed its evolution.
“The inequity that has characterized the global response has now come home to roost,” he told the talks, noting that Botswana and South Africa had fully vaccinated less than a quarter of their populations.
- Omicron was first reported on Nov. 24 from South Africa, where infections have risen steeply.
It has since spread to more than a dozen countries, many of which have imposed travel restrictions to try to seal themselves off. Japan on Monday joined Israel in saying it would close its borders completely to foreigners.
The WHO reiterated that, pending further advice, countries should use a “risk-based approach to adjust international travel measures”, while acknowledging that a rise in coronavirus cases might lead to higher morbidity and mortality rates.
“The impact on vulnerable populations would be substantial, particularly in countries with low vaccination coverage,” it added.
In vaccinated persons, meanwhile, “COVID-19 cases and infections are expected … albeit in a small and predictable proportion”.
Overall, there were “considerable uncertainties in the magnitude of immune escape potential of Omicron”, and more data was expected in coming weeks.
Stock market correction not far away: 9 warning signs, what equity investors should do
- After months of small dips and immediate recoveries, the Sensexslipped by more than 2,500 points last week. Is this the start of the long-awaited correction or just another blip in its one-way rally? The Indian stock markets have not witnessed a genuine correction since March 2020. In stock market parlance, a correction means a fall of more than 10% in the major indices from their recent top.
Although the Sensex has not breached that level yet, experts say that this one-way rally can’t continue forever and, therefore, investors should consider booking some profits now. There are enough warning signs coming from the markets and a full-fledged correction can’t be far away. Let us examine these warning signs and what they mean for investors.
Valuations are high
The Indian equity market has been overvalued for quite some time. But the overvaluation has reached worrisome levels now. The Sensex forward 12-month PE is at a 12-year high and well above its 10-year average (see graphic). Besides, the Indian market is now significantly overvalued compared to other emerging markets (see graphic). The valuation premium has been calculated using the PE ratios of MSCI India Index and MSCI Emerging Markets Index. Due to this overvaluation, foreign portfolio investors (FPIs) may book profits in Indian equities and invest elsewhere. In fact, this has already started.
What do these high valuations mean for investors? “Since the market is expensive now, the next one year’s return is going to be muted,” says Sameer Kaul, Managing Director & CEO, TrustPlutus. “The high valuation can’t be sustained because it is not supported by fundamentals. As of now, the market is over discounting the future earnings,” says Hasit Pandya, Director, HPMG Shares & Securities. “Investors should be cautious because the current valuation is factoring in 2023-24 earnings. Analysts are rolling forward their estimates to 2023-24 and upgrading individual stock targets based on that,” says Shyamsunder Bhat, CIO, Exide Life Insurance.
Halt in earnings upgrade cycle
- To be fair, the better than expected growth in corporate earnings in the past few quarters had justified the high valuations. Analysts used to upgrade the projection for the full year after every quarter. However, this upgrade cycle has now come to an end (see graphic). The expected Nifty EPS for 2021-22 has not moved up in the past six months. “Corporate earnings are muted because margins got compressed due to rising costs. A similar trend is expected in third quarter also,” says Pandya. Supply disruptions, like the chip shortage forcing auto companies to cut production, is also impacting aggregate earnings. If supply disruptions continue for some more quarters, we may even see earnings downgrades.
espite the halt in upgrades cycle, the broader market is still holding up due to two factors. “The market is taking solace from the fact that the top-line growth was better than expected,” says Sanjay Sinha, Founder, Citrus Advisors. Though high revenue growth is a good indicator, it is not a substitute for higher earnings growth. Investors’ strategy of carrying forward this year’s lower growth to the next year is another reason for this. Since corporate earnings were not growing at the expected rate earlier and the market was doing well based on hope, investors think that it will continue to rise. However, hope can’t be an investment strategy; especially after the earnings upgrade cycle came to a halt.
Liquidity is ebbing
After pumping in large amounts of liquidity, global central bankers have realised that just like you can’t extract too much juice from an orange, they can’t extract additional growth by keeping the tap open. They have therefore started closing down the liquidity tap. The additional liquidity can’t be used productively for economic growth, so the excess money is chasing all asset classes (and even non-existent asset classes like cryptos) and pushing their prices to new highs. This has resulted in a big jump in commodity prices and in turn, resulted in higher inflation. So, central bankers have no option other than reducing liquidity. The US Federal Reserve has already announced its plan to reduce the quantity of bonds it will buy.
Will this impact equity investors in India? Certainly, because the entire rally in 2020 and 2021 was driven by liquidity and not because of the economic growth. In fact, even after the smart recovery in 2021, the GDP has only reached its 2019 level. “Since liquidity drives up the froth, its reduction across the world will put pressure on the markets. However, this withdrawal will be a gradual process and will take around six months,” says Mayank Khemka, CIO-India, Deutsche Bank.
Given that domestic inflation has started easing, RBI may not get on the rate hike wagon soon. However, a sudden weakening of the rupee could become the turning point. “Domestic and global liquidity is expected to be withdrawn slowly. However, domestic liquidity will fall fast if there is a sudden fall in the rupee and RBI starts defending the currency,” says Kaul.
FPIs are booking profits
Selling by FPIs has accelerated in recent months. They have already withdrawn $3 billion (Rs 22,500 crore) from the equity markets in the past 12 months.
- FPIinvestments in IPOs are also counted as inflows, otherwise the reported outflow would have been much higher. FPIs are booking profits in Indian stocks partly because of high valuations and high historical returns. They are also selling because of the reduction in global liquidity and the resultant repatriation of funds back to the US. As of now, increased domestic inflows from all quarters, including mutual funds, HNIs and retail investors, were able to match the outflow and thereby give some stability to the market. However, there is no guarantee that this balance will continue in future. “The risk appetite of retail and HNI investors can change very fast. If the FPI selling continues unabated, it will impact their sentiments,” says Deepak Jasani, Head of Retail Research, HDFC Securities.
It might sound counter intuitive, but the FPI selling may stop if the market corrects. “FPI selling, to some extent, is because of relative attractiveness of China. Once the correction happens, India will also become attractive,” says Jaspreet Singh Arora, CIO, Equentis Wealth Advisory Services.
IPOs are draining liquidity
In addition to the liquidity reduction on a global scale, a large number of IPOs have hit the Indian market now and more are expected in the coming months. The IPO rush has drained out liquidity from the secondary market. “IPOs with very high valuations and money flowing towards the IPO market are the biggest worries for the market now,” says Pandya. According to Prime Database, fund raising through the IPO route during the year has already crossed Rs 1.03 lakh crore. This is only slightly lower than the Rs 1.37 lakh crore raised during the previous four years ( see graphic).
Collection are expected to rise further in the coming months because IPOs worth Rs 43,778 crore are waiting with valid Sebi approvals while IPOs of Rs 82,515 crore are filed and waiting for Sebi approvals. In addition to sucking out liquidity, these giant IPOs are also a warning sign for the market. “Large, overpriced IPOs usually come at the end of the bull market and therefore, usually signals the end of the secondary market rally,” says Khemka.
Will the recent Paytm fiasco burst the IPO pipeline? Analysts are divided on the impact. “One issue will not dampen the IPO pipeline. But this will bring some correction in IPO valuations. The IPO pipeline will continue so long as the secondary market remains stable,” says Pranav Haldea, Managing Director, Prime Database. “It seems the market has already discounted the fallout of the Paytm IPO. However, the primary market sentiments will get dented if another big IPO also gets listed at a discount,” says Jasani.
Also Read: Will Paytm’s disastrous listing impact the IPO market?
The BJP’s losses in recent by-elections raised some concerns of political uncertainty in the market. The Uttar Pradesh assembly elections which are due in 2022 are critical because the state has the highest number of parliamentary seats. The recent decision by the Central government to withdraw the farm bills has dampened the market sentiment further. “Reversal of farm bills has raised doubts whether the central government will initiate new ‘hard reforms’ till the general elections in 2024,” says Shailendra Kumar, CIO, Narnolia Financial Advisors.
However, the market continues to expect a regular dose of reforms from the government. “Instead of big-ticket reforms, the government is now expected to concentrate on incremental reforms like reducing the number of slabs under GST, etc,” says Arora. In this context, the market will be keenly watching two upcoming events – the Union budget for signals on economic reforms and assembly election results for clarity on political uncertainty.
Complacency has set in
Since market corrections come at the least expected time, the investor’s complacency is the biggest warning sign now. Major indices have not corrected by more than 10% during the past 18 months, and therefore, most investors have started believing that any correction will be only 5-7%. “Investors have become complacent and therefore, market need a proper correction. Since the 16,000-16,500 level can be treated as fair valuation zone for the Nifty, a correction to that range is reasonable,” says Kaul. Other experts also agree that a deeper correction is needed in the market right now. “It will be healthy if a correction of 10-12% from the top happens. In addition to reducing the froth, this will also shake weak hands out of the market,” says Khemka of Deutsche Bank. A 12% cut from the recent top will take the Sensex and Nifty to 54,776 and 16,372 respectively.
Historical returns are high
- The high historical returns is one of the reasons why domestic investors have become complacent. The 3-year SIP returns on the Sensex are already at a 12-year high and well above their long-term average (see graphic). Professional investors tend to book profit after windfall gains. In fact, the FPI selling is partly due to this.
Retail investors, on the other hand, usually chase historical returns. The enormous amount of money flowing into domestic funds now is proof of this. However, investors should know that no market can continue on a one-way trip like this. The returns ultimately come down due to mean reversion. The average 3-year SIP returns are already close to 25% now. When 3-year SIP returns were above 20%, the average 1-year return generated is -8.58%. Investors should be ready for such returns in the next one year.
In addition to the fundamental factors mentioned above, several technical indicators are also pointing towards a deep correction. First is the confirmation of a bearish Head and Shoulder pattern on daily price chart (see graphic). The bearish Head and Shoulder pattern is a powerful technical reversal signal and occurs during phases of distribution.
“We were seeing distribution for the past two months and the same is visible on the Head and Shoulder pattern. Since break down of its neckline has happened now, the correction is expected to continue for some more time,” says Ajit Mishra, Vice-President, Research and Religare Broking. The Head and Shoulder pattern’s target is based on its height. Since the breakout happened at 59,500, its total height is 2,700 points and fall after the breakout will be the same. So, the pattern target is 56,800 for the Sensex and 16,700 for the Nifty.
Other technical indicators also point towards a correction. The weekly Sensex MACD has shown negative divergence after a gap of two years (see graphic). MACD stands for moving average convergence divergence and is the difference between two moving averages – ie 12 days and 26 days used for the chart. A moving average of the MACD is used as trigger line ( 9-day moving average used in the chart).
MACD going below its indicator is a sell signal (marked with down arrow) and going above is a buy signal (marked with up arrow). Though such crossovers occur frequently, divergence occurs only occasionally and therefore, has higher significance. As the chart shows, the MACD did not climb above its previous peak, despite the Sensex doing so. This is a negative divergence.
In addition to Head and Shoulder pattern and the MACD, some other technical patterns and indictors are also signalling bearish outlook. “Sensex decisively going below its 50-day moving average is a warning signal. If it doesn’t recover by December, it will be the first negative quarter after March 2020 and that means the correction will then be for the entire rally that started in March 2020,” says Jay Thakkar, Vice-President and Head of Research, Marwadi Shares & Finance. A correction like this usually takes the index to important retracement levels like 23.6%. This level is 54,000 for the Sensex and 16,000 for the Nifty.
What investors should do now
“The best strategy now is to book some profit and move that part of the money to debt,” says Pandya. Another option is to cover your remaining equity position by buying a put option or by writing a call option. You also need to restructure your portfolio. Since the market has run ahead of itself, even companies with modest growth are also trading at very high valuations. “Profit booking is happening when the earnings growth is not as expected by the market. Check all stocks where the forward PE is over 25 times and make sure that this high valuation is justified,” says Kaul of TrustPlutus.
This advice is only for investors who are already in equities. If you are a new investor and planning to invest in stocks because everybody is making money, we advise you not to venture in now. Enter only after the market witnesses a deeper correction. As we have explained, this may not be too far away.
(Originally published on Nov 29, 2021, 06:30 AM IST)
Boosting green hydrogen
- Hydrogen is the most promising solution to decarbonize
- Prime Minister Narendra Modi recently announced that India would aim for net-zero carbon emissions by 2070. The announcement was given credence by the country’s solar achievements since 2015. India is the only major economy whose policies and actions are on track to limit global average temperature Rise below 2°C above pre-industrial levels, as envisioned in the Paris Agreement.
India has a head start
As of now, 75% of India’s energy demand is met by coal and oil, including imports. This is expected to increase. Therefore, the synergy between renewable energy and green hydrogen must be tapped to tackle the dependence on fossil fuel and take greater advantage of India’s solar capacity. Hydrogen — green hydrogen, in particular — is a crucial weapon in India’s arsenal to fight climate change as it improves the long-term energy storage capabilities of renewable energy. The simplest element in the periodic table is also the most promising solution to decarbonise sectors like cement, steel, and refineries. “Hydrogen can provide the lowest-cost decarbonization solution for over a fifth of final energy demand by mid-century — contributing a cumulated reduction of 80Gt of CO2 — and is thus an essential solution to reach the 1.5°C climate scenario,” read a recent statement from the Hydrogen Council. Several major economies which are adopting legislation to reduce carbon emissions are also catalysing global efforts towards transitions to green hydrogen.
A low-carbon source of energy is required to generate hydrogen through electrolysis – the splitting of a water molecule into hydrogen and oxygen. The hydrogen produced is coded with a colour, depending on the method of its production. While hydrogen generated through renewable energy sources is green, it is blue when the carbon generate from the process is captured and stored without dispersing it in the atmosphere. When the carbon is not captured, the generated hydrogen is labelled grey.
Nearly 70% of the investments required to produce green hydrogen through electrolysis goes into generating renewable energy. With India’s solar capacity increasing nearly 3,000 times in less than a decade, the cost of solar energy has reached a low of ₹2 per kWh. This gives India a unique head start in scaling up the use of green hydrogen. India can reduce its carbon emissions and make a dent in its annual import bills by developing a value chain for hydrogen from its production to its diverse applications, including production technologies, storage, transport and distribution, infrastructure (ports, refuelling stations), vehicular applications, and electricity/gas grid.
- Government funding and long-term policies that attract private investments within the standards and a progressive compliance framework are essential to boost green hydrogen. Hydrogen’s cross-sectoral capabilities should be exploited according to each sector’s cost and ease of adoption. A few key sectors with low transition costs, such as refineries, fertilizers and natural gas, should be mandated to use hydrogen to bring down costs as part of near-term goals. New demand from steel, cement and road mobility should be mandated as part of medium-term goals.
Heavy-duty vehicles should receive State and Central incentives. Shipping, aviation, energy storage and solutions towards power intermittency should be mandated to use green hydrogen in the long run.
Enforcing time-bound mid- and long-term policies would inspire the private sector to invest more in green hydrogen and give the boost it requires in its nascent stages. India’s current grey hydrogen production is six million tonnes per annum, which is around 8.5% of global annual production. India should replace this with green hydrogen and reduce dependence on imported ammonia. It should aim to produce 4-6 million tonnes of green hydrogen per annum by the end of the decade and export at least 2 million tonnes per annum. India has already taken the first step with the Indian Oil Corporation floating a global tender to set up two green hydrogen generations units at the Mathura and Panipat refineries.
At present, more than 30 countries have hydrogen road maps and over 200 largescale hydrogen projects across the value chain. If all the projects come to fruition, total investments will reach $300 billion in spending by 2030. Governments worldwide have committed to more than $70 billion in public funding, according to Hydrogen Council, to develop a hydrogen economy. With its abundant and cheap solar energy, India has the upper hand to tap into these investments and lead global efforts in transitioning to green hydrogen.
Net direct tax revenue rose 68% till November 23: MoS
- Gross GST collection showing rising trend, says Chaudhary
The net direct tax collection grew almost 68% during the April 1-November 23 perio to more than ₹6.92 lakh crore, Minister of State for Finance Pankaj Chaudhary said on Monday.
“The Net Direct Tax Collection figures for the FY- 2021-22 as on 23.11.2021 are at ₹6,92,833.6 crores showing a growth of 67.93% and 27.29% over the net collection figures for the corresponding period FY2020-21 and FY 2019-20,” he said in a written reply in the Lok Sabha.
The net collection betweenApril 1 – November 23 in 2020-21 and 2019-20 fiscals was more than ₹4.12 lakh crore and over ₹5.44 lakh crore, respectively.
The gross direct tax collection (before adjusting refunds) as of November 23 stood at more than ₹8.15 lakh crore, a 48.11% growth over collections a year earlier. Mr. Chaudhary further said gross GST collection in the current fiscal (April 2021- March’22) post COVID-19 outbreak is showing an increasing trend.
- Gross GST collection for the year ended March 2021 was more than ₹11.36 lakh crore, while the same in the current fiscal till October stood at ₹8.10 lakh crore.
- In reply to a question on whether incidents of tax evasion are increasing in Delhi and other parts of the country, he said there was no evidence to suggest the trend.
“In terms of cases detected under Goods & Service Tax (GST) and Customs, there is no increasing trend in such evasion noticed in Delhi; although, there is overall increase in detection of GST and Customs evasion cases in the country,” Mr. Chaudhary added.