PRELIMS CURRENT AFFAIRS – 15/08/24

01. Consider the following statements with respect to Marginal cost of fund based lending rate (MCLR)

1. When MCLR increases, it will not have any impact on the interest rates charged by the banks. 
2. Changes in MCLR is uniform across the country 

Which of the statements given above is/are correct?

1. 1 only
2. 2 only 
3. Both 1 and 2
4. Neither 1 nor 2

Answer:  (d) Neither 1 nor 2

In News: SBI raises MCLR by 10 bps across tenors 

Explanation:

• The Marginal Cost of Fund based Lending Rate refers to the minimum interest rate a bank must charge for lending. The bank cannot grant any loan below that rate, except in certain cases permitted by the Reserve Bank of India (RBI). 
• It is determined by banks internally, depending upon the loan repayment time. 
• MCLR  is an “internal benchmark” which varies from bank to bank. It is calculated based on the marginal cost of funds. Hence statement 2 is incorrect
• If the cost of funds goes up, the MCLR increases, and the loans linked to any MCLR tenor get more expensive. Similarly, if the MCLR comes down, loans get cheaper.   Hence statement 1 is incorrect
•  Factors impacting MCLR 

• Banks must maintain a Cash Reserve Ratio (CRR) of 4%.
• Banks can avail some allowance under MCLR; it is called Negative Carry on CRR. It happens when the CRR balance is zero, i.e., when the actual return is lesser than the cost of funds.
• The Operating costs related to providing loan products must be considered.
• The difference between MCLR and base rate is as follows:

• MCLR is an advanced version of the base rate.
• The base rate uses the average finance cost, but MCLR is based on the marginal or incremental cost of money.
• When calculating the base rate, a minimum rate of return/profit margin is used, whereas, for MCLR, banks are required to include tenor premium into the calculation. Thus banks charge a higher rate of interest for long-term loans.

Source:

https://indianexpress.com/article/business/banking-and-finance/sbi-raises-mclr-by-10-bps-across-tenors-9514762/

02. Consider the following statements:

1. India is one of the Contracting Parties to Ramsar Convention, signed in Ramsar, Iran, in 1971
2. India became a signatory to the convention in 1982
3. Currently,Uttar Pradesh harbours maximum number of Ramsar Sites.

How many of the above statements are correct?

1. Only one
2. Only two
3. All three
4. None

Answer:  (b)Only two

In News:Union Environment Minister Shri Bhupender Yadav says India adds 3 more wetlands to the list of Ramsar sites on the eve of Independence Day 2024

Explanation:

• Union Minister for Environment, Forest and Climate Change Shri Bhupender Yadav said on the eve of Independence Day 2024 that India has increased its tally of Ramsar sites (Wetlands of International Importance) to 85 from existing 82 by designating three more wetlands as Ramsar Sites. 
• With this addition, the area of Ramsar sites touched to 1358067.757 ha in the country. The three new sites included are Nanjarayan Bird Sanctuary and Kazhuveli Bird Sanctuary in Tamil Nadu and Tawa Reservoir in Madhya Pradesh. These new designated sites are a testament to the significant policy push from the Ministry of Environment, Forest and Climate Change for wetlands conservation and management in the country.
• India is one of the Contracting Parties to Ramsar Convention, signed in Ramsar, Iran, in 1971.Hence statement 1 is correct. 
• India became a signatory to the convention on 1st February 1982.Hence statement 2 is correct.  
• During 1982 to 2013, a total of 26 sites were added to the list of Ramsar sites, however, during 2014 to 2024, the country has added 59 new wetlands to the list of Ramsar sites.
• Currently, Tamil Nadu harbours maximum number of Ramsar Sites (18 sites) followed by Uttar Pradesh (10 sites).Hence statement 3 is incorrect. 
• The Nanjarayan lake a large shallow wetland situated along the north-eastern region of Uthukuli Taluk of Tiruppur District in Tamil Nadu. 
• Kazhuveli is one of the significant and biodiversity rich wetlands. The lake is one of the largest wetlands in peninsular India. 
• The lake can be divided into three parts based on the water features viz., the estuarine part with brackish water, the Uppukali creek feeding the sea water and the Kazuveli basin with fresh water.
• The Tawa Reservoir has been constructed at the confluence of the Tawa and Denwa rivers, Madhya Pradesh. River Malani, Sonbhadra, and Nagdwari are the major tributaries of Tawa reservoir. 
• Tawa River, a left bank tributary originates from Mahadeo hills, joins river Narmada. It is the longest tributary of river Narmada (172 Km). 

Source:

https://pib.gov.in/PressReleasePage.aspx?PRID=2045232

03. Consider the following statements with respect to Wholesale Price Index:

1. WPI is restricted to only goods, while CPI is for both goods and services. 
2. Primary articles, Food & fuel are the only commodities used for calculating WPI 

Which of the statements given above is/are correct?

1. 1 only
2. 2 only
3. Both 1 and 2
4. Neither 1 nor 2 

Answer:  (a) 1 only

In News: Food prices accelerated to 2.7% from 2.1% in June, the highest pace in at least six months 

Explanation:

• WPI measures the changes in the prices of goods sold and traded in bulk by wholesale businesses to other businesses.
• It is calculated and published by the Office of Economic Advisor, Department of Industrial Policy and Promotion in the Ministry of Commerce and Industry.
• WPI data is published monthly, with the index value representing an estimate of the price level for the month as a whole, rather than a specific date.
• Difference between WPI and Consumer Price Inflation (CPI) inflation:

• While the WPI keeps track of the wholesale price of goods, the CPI measures the average price that households pay for a basket of different goods and services.
• WPI is restricted to only goods, while CPI is for both goods and services.Hence statement 1 is correct.  
• Even as the WPI is used as a key measure of inflation in some economies, the Reserve Bank of India (RBI) no longer uses it for policy purposes, including setting repo rates. The RBI currently uses CPI, or retail inflation, as a key measure of inflation to set monetary and credit policy.

• It is calculated by taking a weighted average of the prices of a basket of goods, with each item’s weight determined by its share of total wholesale sales.
• The basket of goods comprises three major groups:

• Primary Articles (Weight 22.62%)
• Fuel and Power (Weight 13.15%)
• Manufactured Products (Weight 64.23%)Hence statement 2 is correct. 
• The prices of a total of 697 items are tracked under the 2011-12 series of the WPI, which includes 117 primary items, 16 items of fuel and power, and 564 manufactured products.

Wights of Various CPI Series for All-India at Group and Sub-Group Levels

• The Consumer Food Price Index (CFPI) is a monthly calculation that measures changes in the retail prices of food items consumed by the population in India. 
• The Central Statistics Office (CSO) of the Ministry of Statistics and Programme Implementation (MOSPI) has been releasing the CFPI since May 2014, separately for rural, urban, and combined categories. 
• The Reserve Bank of India (RBI) uses the CFPI as a sub-component of the broader Consumer Price Index (CPI) to monitor inflation. 

Source:

https://www.thehindu.com/business/Economy/wholesale-price-inflation-drops-to-204-in-july/article68523668.ece

04.With reference to InSight Lander,consider the following statements

1. It was the first outer space robotic explorer to study in depth the inner space of Mars
2. It is part of NASA’s Discovery Program.

Which of the statements given above is/are correct?

1. 1 only 
2. 2 only
3. Both 1 and 2 
4. Neither 1 nor 2

Answer:  (c) Both 1 and 2 

In News: Huge reservoir of water under Mars, seismic data indicates

Explanation:

• An immense reservoir of liquid water may reside deep under the surface of Mars within fractured igneous rocks, holding enough to fill an ocean that would cover the entire surface of Earth’s planetary neighbour.
• That is the conclusion of scientists based on seismic data obtained by NASA’s robotic InSight lander during a mission that helped decipher the interior of Mars.
• The water, located about 11.5 to 20 km below the Martian surface, potentially offers conditions favourable to sustaining microbial life

About InSight Lander

• InSight Lander was the first outer space robotic explorer to study in depth the inner space of Mars: its crust, mantle, and core.Hence statement 1 is correct. 
• It was a NASA Discovery Program mission that placed a single geophysical lander on Mars to study its deep interior.Hence statement 2 is correct. 
• It addressed one of the most fundamental issues of planetary science: understanding the processes that shaped the rocky planets of the inner solar system (including Earth) more than four billion years ago. 
• It also found evidence of a liquid magma ocean in Mars’ past, suggesting that the planet had a much more dynamic geological history than previously thought.

The lander carried two key instruments:

• a seismometer to detect Marsquake.
• a heat flow probe to measure the heat coming from Mars’ interior.

Source: https://www.thehindu.com/sci-tech/science/huge-underground-reservoir-of-liquid-water-on-mars-seismic-data-indicates/article68518321.ece#:~:text=The%20Martian%20surface%20is%20cold,once%20was%20warm%20and%20wet&text=An%20immense%20reservoir%20of%20liquid,surface%20of%20Earth’s%20planetary%20neighbor.

05.With reference to Interest equalisation scheme,consider the following statements

1. It aims to provide pre and post-shipment export credit to exporters in rupees. 
2.  It is being implemented by the RBI through various Public and non-Public Sector banks 

Which of the statements given above is/are correct?

1. 1 only 
2. 2 only
3. Both 1 and 2 
4. Neither 1 nor 2

Answer:  (c) Both 1 and 2 

In News: Interest equalisation, RoDTEP export sops to be back soon

Explanation:

• The Commerce Ministry is pushing to restore the Interest Equalisation scheme, which is available for small businesses, till August 31, for all exporters soon, and ensure that duty remission benefits granted to exporters, under a 2021 scheme called RoDTEP, are extended beyond September.

About Interest Equalisation Scheme

• The Interest Equalization Scheme (IES) was first implemented on 1st April 2015 to provide pre and post-shipment export credit to exporters in rupees. 
• Banks provide Interest Equalization Scheme benefits to the eligible exporters and claim a reimbursement from the Reserve Bank of India based on the external auditor certification furnished by the exporter. 
• The scheme helps the identified export sectors to be internationally competitive and to achieve a higher level of export performance.
• All eligible exports under the interest equalization scheme need to meet the criteria of minimum processing for the goods. The goods originating from India will be qualified for the scheme and benefits.
• Currently, the Scheme provides an interest equalisation benefit at the rate of 2% on pre- and post-shipment rupee export credit to merchant and manufacturer exporters of 410 identified tariff lines at 4-digit level and 3% to all MSME manufacturer exporters. Hence statement 1 and statement 2  is correct
• The Scheme has now been made fund-limited, and the benefit to individual exporters has been capped at Rs 10 Crore per annum per IEC (Import Export Code). 
• In addition, the banks that lend to exporters at an average rate of more than Repo + 4% would be debarred under the Scheme.

Source: https://www.thehindu.com/business/interest-equalisation-rodtep-sops-for-exports-to-be-back-soon/article68526354.ece#:~:text=The%20Commerce%20Ministry%20is%20pushing,beyond%20September%2C%20top%20officials%20said.

06.Consider the following statements regarding Ballast water 

1. It is fresh or saltwater held in the ballast tanks and cargo holds of ships. 
2. It is used to provide stability and maneuverability during a voyage.

Which of the statements given above is/are correct?

1. 1 only 
2. 2 only
3. Both 1 and 2 
4. Neither 1 nor 2

Answer:  (c) Both 1 and 2 

In News: Does India have laws against invasive species from ballast water? 

Explanation:

• The Tamil Nadu Water Resources Department (WRD) has informed the National Green Tribunal that it has sought ₹160 crore from the Kamarajar Port in Ennore, Tamil Nadu, to facilitate the removing of invasive mussels on the coast near the port in connection with an ongoing case on the proliferation of Mytella strigata, or charru mussel that harms marine ecosystems and hinders fisher boat movements, affecting their livelihood. 

About Ballast water 

• Ballast water is one of the major pathways for the introduction of nonindigenous marine species. 
• Ballast water is fresh or saltwater held in the ballast tanks and cargo holds of shipsHence statement 1 is correct. 
• It is used to provide stability and maneuverability during a voyage when ships are not carrying cargo, not carrying heavy enough cargo, or when more stability is required due to rough seas.Hence statement 2 is correct 
• Ballast water may also be used to add weight so that a ship sinks low enough in the water to pass under bridges and other structures.
• Ballast water is then transported and released at the next port-of-call where the ship picks up more cargo. 
• The release of ballast water may introduce non-native organisms into the port of discharge.

Source: https://www.thehindu.com/news/national/does-india-have-laws-against-invasive-species-from-ballast-water/article68522092.ece

07. Consider the following statements regarding Jiyo Parsi Scheme portal

1. It is a Central Sector Scheme implemented by the Ministry of Home Affairs.
2. It provides financial assistance to Parsi couples for medical treatment and childcare

Which of the statements given above is/are correct?

1. 1 only
2. 2 only
3. Both 1 and 2 
4. Neither 1 nor 2

Answer:  (b) 2 only

In News: Kiren Rijiju launches portal for Jiyo Parsi Scheme

Explanation:

The Minister for Minority Affairs Kiren Rijiju on Tuesday (August 13, 2024) launched the Jiyo Parsi Scheme portal

About Jiyo Parsi Scheme portal

• It is a Central Sector Scheme to arrest the population decline of the Parsi community in India.Hence statement 1 is incorrect
• Emphasising on the rich heritage and culture of the community and Parsi population is decreasing and this needs to be addressed.
• It provides financial assistance to Parsi couples for medical treatment and childcare.Hence statement 2 is correct
• The objective of the scheme is to reverse thedeclining trend of the Parsi population by adopting scientific protocols and structured interventions to stabilize their population in India.

The scheme has three components: Medical Assistance, Advocacy, and Health of Community.

• Under the Medical Component of the scheme, financial assistance is provided to Parsi Couples for medical treatment under standard medical protocol.
• Under the Health of Community Component, financial assistance is provided to Parsi Couples for child care and assistance of elderly people.
• Under the Advocacy Component, advocacy/outreach programmes are conducted to generate awareness among the Parsi population.

Source: https://www.thehindu.com/news/national/kiren-rijiju-launches-portal-for-jiyo-parsi-scheme/article68520734.ece

08. Consider the following statements

1. A complaint under the Lokpal Act should be in the prescribed form and must pertain to an offence under the Prevention of Corruption Act, 1988 against a public servant.
2. Lokpal have power of superintendence and direction over any central investigation agency including CBI for cases referred to them by the Lokpal

Which of the statements given above is/are correct?

1. 1 only
2. 2 only
3. Both 1 and 2
4. Neither 1 nor 2

Answer:  (c) Both 1 and 2

In News:78th Independence Day celebrations at Lokpal of India

Explanation:

• On the 78th Independence Day, The National flag was hoisted by Hon’ble Shri Justice Ajay Manikrao Khanwilkar, Chairperson, Lokpal of India, in the august presence of Hon’ble Members:
• The Lokpal has jurisdiction to inquire into allegations of corruption against anyone who is or has been Prime Minister, or a Minister in the Union government, or a Member of Parliament, as well as officials of the Union Government under Groups A, B, C and D. Also covered are chairpersons,members, officers and directors of any board, corporation, society, trust or autonomous body either established by an Act of Parliament or wholly or partly funded by the Union or State government. It also covers any society or trust or body that receives foreign contributions above ₹10 lakh (approx. US$ 14,300/- as of 2019).
• A complaint under the Lokpal Act should be in the prescribed form and must pertain to an offence under the Prevention of Corruption Act, 1988 against a public servant.Hence statement 1 is correct.
• There is no restriction on who can make such a complaint. When a complaint is received, the Lokpal may order a preliminary inquiry by its Inquiry Wing or any other agency, or refer it for investigation by any agency, including the CBI, if there is a prima facie case. 
• Before ordering of an investigation by an agency, the Lokpal shall call for an explanation from the public servant to determine whether a prima facie case exists. This provision, the Act says, will not interfere with any search and seizure that may be undertaken by the investigating agency. 
• The Lokpal, with respect to Central government servants, shall refer the complaints to the Central Vigilance Commission (CVC). 
• The CVC will send a report to the Lokpal regarding officials falling under Groups A and B; and proceed as per the CVC Act against those in Groups C and D.
• The Inquiry Wing or any other agency will have to complete its preliminary inquiry and submit a report to the Lokpal within 60 days. It has to seek comments from both the public servant and “the competent authority”,before submitting its report.
•  There will be a “competent authority” for each category of public servant as defined under the Act.
• A Lokpal Bench shall consider the preliminary inquiry report, and after giving an opportunity to the public servant accused of corruption for his/her defence, decide whether it should proceed with the investigation.
•  It can order a full investigation, or direct to start departmental proceedings or close the proceedings.
•  It may also proceed against the complainant if the allegation is false. The preliminary inquiry should normally be completed within 90 days of receipt of the complaint.
• After the investigation, the agency ordered to conduct the probe has to file its investigation report in the court of appropriate jurisdiction, and a copy of the report has to be filed before the Lokpal. 
• A Bench of at least three members will consider the report and may grant sanction to the Prosecution Wing to proceed against the public servant based on the agency’s charge-sheet.
•  It may also ask the competent authority to take departmental action or direct the closure of the report. 
• Previously, the authority vested with the power to appoint or dismiss a public servant was the one to grant sanction under Section 197 of the Code of Criminal Procedure and Section 19 of the Prevention of Corruption Act. Now this power will be exercised by the Lokpal.
• The lokpal is vested with the power of search and seizure and also powers under the Civil Procedure Code for the purpose of conductiong preliminary inquiry & investigation and power of attachment of assets and taking other steps for eradication of corruption.
• Lokpal will have power of superintendence and direction over any central investigation agency including CBI for cases referred to them by the Lokpal.Hence statement 2 is correct.

Source:

https://pib.gov.in/PressReleasePage.aspx?PRID=2045543

https://www.lokpal.gov.in/?about_us?Jurisdiction_and_Functions_of_Lokpal?0103

09. With reference to Pradhan Mantri Awas Yojana-Urban 2.0,consider the following statements:

1. The scheme aims to construct 1 crore houses for urban poor and middle-class families over the next five years, with an investment of ₹10 lakh crore and a government subsidy of ₹2.30 lakh crore.
2. The scheme aims to benefit 1 crore families, with a particular focus on equity among different segments of the population. 
3. The management of the credit risk guarantee fund was transferred to the National Credit Guarantee Company from National Housing Bank.

How many of the above statements are correct?

1. Only one
2. Only two
3. All three
4. None

Answer:  (c)All three

In News:Tweaks in PM Awas Yojana to benefit affordable HFCs

Explanation:

• The incremental changes in the Pradhan Mantri Awas Yojana and the updated interest subsidy scheme are seen benefiting affordable housing finance companies (AFHCs) in particular, as well as leading to more stable repayments, lower pre-payments and balance transfers, analysts feel. 
• Last week, the PMAYUrban scheme got a facelift and the Union Cabinet approved financial assistance for 1 crore urban houses to be constructed, purchased or rented for urban poor and middle class families. 
• An investment of ₹10 lakh crore and government subsidy of ₹2.3 lakh crore were also approved as part of the scheme. 
• In addition, the corpus fund of the credit risk guarantee fund trust was increased to ₹3,000 crore from ₹1,000 crore earlier that would be applicable on affordable housing loans from banks, HFCs, primary lending institutions to economically weaker sections and low income groups. 
• The management of the fund was also transferred to the National Credit Guarantee Company from National Housing Bank.Hence statement 3 is correct.
• The Union Cabinet, chaired by Prime Minister Shri Narendra Modi, has approved the Pradhan Mantri Awas Yojana-Urban (PMAY-U) 2.0. 
• This ambitious scheme aims to construct 1 crore houses for urban poor and middle-class families over the next five years, with an investment of ₹10 lakh crore and a government subsidy of ₹2.30 lakh crore.Hence statement 1 is correct.
• PMAY-U 2.0 is designed to extend financial assistance to urban poor and middle-class families for constructing, purchasing, or renting houses at affordable costs in urban areas.
•  This initiative aligns with the Government of India’s vision to ensure that every citizen has access to a pucca house, thereby enhancing their quality of life.
• The scheme aims to benefit 1 crore families, with a particular focus on equity among different segments of the population.Hence statement 2 is correct. 
• Special attention will be given to marginalized groups, including slum dwellers, SC/STs, minorities, widows, persons with disabilities, and other underprivileged sections of society. 
• Additionally, groups like Safai Karmi, street vendors, artisans, anganwadi workers, and residents of slums/chawls will receive focused support under this scheme.

Source:

https://epaper.thehindubusinessline.com/ccidist-ws/bl/bl_chennai/issues/95157/OPS/G30D6S404.1+GVID6TEK7.1.html

10.Consider the following: (2019)

1. Carbon monoxide
2. Methane
3. Ozone
4. Sulphur dioxide

Which of the above are released into atmosphere due to the burning of crop/biomass residue?

(a) 1 and 2 only

(b) 2, 3 and 4 only

(c) 1 and 4 only

(d) 1, 2, 3 and 4

Answer: (d) 1,2,3 and 4