THE CONTEXT: The Union Cabinet has approved Rs 6,322 crore production-linked incentive (PLI) scheme for specialty steel.

Analysis

• Speciality steel has been chosen as the target segment by the government because out of a production of 102 million tonnes of steel in 2020-21, only 18 million tonnes of value-added steel/speciality steel were produced in the country.
• Moreover, of 6.7 million tonnes of imports in the same year, approximately four million tonnes were of speciality steel, resulting in forex outgo of approximately Rs 30,000 crore,
• Speciality steel can be used in various strategic applications like defence, space, power, automobile sector, specialised capital goods, among others.
• There are three slabs of PLI incentives, the lowest being four per cent and highest being 12 per cent, which has been provided for electrical steel (CRGO). The duration of the scheme will be five years, from 2023-24 to 2027-28.

POTENTIAL IMPACT OF THE SCHEME

• This move is expected to attract an additional investment of about Rs 40,000 crore and capacity addition of 25 million tonnes in the segment.
• The scheme will give employment to about 525,000 people of which 68,000 will be direct employment.
• The steel sector is on an uptrend and major integrated producers have lined up major expansion plans; the PLI scheme is expected to boost those plans further.
• Most of the imports into India are in the value-added and speciality segment. The PLI scheme will boost manufacturing capacities by Indian mills in this segment and MSMEs will be able to source from them directly.
• The government expects the benefits of the scheme to accrue to both integrated steel plants and smaller players (secondary steel players) as speciality steel production to increase to 42 million tonnes by the end of 2026-27.
• This will ensure that approximately Rs 2.5 trillion worth of speciality steel will be produced and consumed in the country which would otherwise have been imported.
• Similarly, the export of specialty steel will become around 5.5 million tonnes as against the current 1.7 million tonnes of specialty steel getting forex of Rs 33,000 crore.

THE CONTEXT: The Reserve Bank of India is planning pilot projects to assess the viability of using digital currency to make wholesale and retail payments.

Analysis

• India is already a leader in digital payments, but cash remains dominant for small value transactions.
• An official digital currency would reduce the cost of currency management while enabling real-time payments without any inter-bank settlement.
• A high-level inter-ministerial committee set up by the Finance Ministry had recommended the introduction of a Central Bank Digital Currency (CBDC) with changes in the legal framework including the RBI Act.

BENEFITS OF THE CBDC

• The cost of printing, transporting and storing paper currency can be substantially reduced given fairly high cash to GDP ratio in India.
• The advent of private virtual currencies is another reason. If these private currencies gain recognition, national currencies with limited convertibility are likely to come under some kind of threat.
• Transacting with CBDC would be an instantaneous process as the need for interbank settlement would disappear as it would be a central bank liability handed over from one person to another
• Moreover, foreign trade transactions could be speeded up between countries adopting a CBDC.
• They could enable a cheaper and more real-time globalisation of payment systems — it is conceivable for an Indian exporter to be paid on a real-time basis without any intermediary.
• The risks of dollar-rupee transactions, the time zone difference in such transactions would virtually disappear.

THE CONTEXT: Ministry of Development of North-East Region (Min of DoNER) along with other departments have under taken various developmental programmes for the NER.

Analysis

• For the current financial year (2021-22), an amount of Rs 68020 crore has been earmarked by 54 Ministries/Departments at the Budget Estimates (BE) stage for North Eastern Region.
• During the FY 2020-21, Government announced a special economic and comprehensive package, which included Pradhan Mantri Garib Kalyan Yojana (PMGKY) and three Atma Nirbhar Bharat (ANB) packages to combat the impact of the COVID-19 pandemic and to revive economic growth.
• The Union Budget 2021-22 also announced increase in investment in Health Infrastructure, Mega Investment Textiles Parks (MITRA), enhancing agricultural credit and infrastructure funds, additional budget allocation to MSME Sector etc.
• Further, in June, 2021, Government announced a relief package of Rs 6.29 lakh crore comprising of 17 measures to support the Indian economy in its fight against the second wave of COVID-19 pandemic.
• Many of these programmes and policies will benefit the North Eastern Region as well.

SPECIFIC INITIATIVES OF THE MIN OF DoNER

• The Ministry of Development of North Eastern Region/ North Eastern Council sanctioned untied funds amounting to Rs. 26.09 crore to combat COVID-19 pandemic in 8 NER States.
• Projects worth Rs. 36.50 crore have also been sanctioned to North Eastern Region States for livelihood generation for returnee migrant worker due to COVID-19.
• Eleven projects amounting to Rs. 313.98 crore have been sanctioned by the Ministry of DoNER under the North East Special Infrastructure Development Scheme (NESIDS) for strengthening health infrastructure of North Eastern States, especially for fighting COVID-19 pandemic.
• During 2020-21, Rs. 322.89 crore was released to the North Eastern States towards the India COVID-19 Emergency Response and Health System Preparedness Packages through National Health Mission (NHM).
• During 2019-20, an amount of Rs 111.34 crore was released to North Eastern States under National Health Mission.
• For the containment measures allowed under SDRF, State Government were allowed to spend upto 35% of the annual allocation of SDRF during the financial year 2019-20.
• The ceiling of 35% was further enhanced to 50% during the financial year 2020-21 and 2021-22.

NOTE: THE ABOVE WRITE UP PROVIDES A READY MADE ANSWER FOR THE GOVERNMENT’S EFFORTS FOR DEVELOPMENT OF NER. GRANULAR DATA IS PROVIDED TO UNDERSTAND THE CONTEXT ONLY.

THE CONTEXT: The Union Cabinet has approved the establishment of an Integrated Multi-purpose infrastructure Development Corporation for the Union Territory of Ladakh

Analysis

• It is a new establishment.  Presently, there is no such similar organization within the newly formed UT of Ladakh.
• The approval has an inherent potential for employment generation as the corporation will be undertaking various kinds of developmental activities.
• Corporation will work for industry, tourism, transport and marketing of local products and handicraft.
• Corporation will also work as main construction agency for infrastructure development in Ladakh.
• The establishment of corporation will result in inclusive and integrated development of the Union Territory of Ladakh.
• This will, in turn, ensure socio-economic development of the entire region and population of the Union Territory.
• The erstwhile State of Jammu and Kashmir has been re organised as per the Jammu and Kashmir Reorganisation Act, 2019.
• On this basis, the Union Territory of Ladakh (without Legislature) came into existence on 31.10.2019