Today’s topics

1. India’s semiconductor mission might need a compass - Page 6

2. A long and rocky road to economic recovery - Page 7

3. Govt. vows swifter nod for exporters - Page 1

Prelims Bytes

4. CERTin may be exempted from giving information

under RTI Act, says Centre - Page 9

5. Australia seeks diversified market for lithium export - Page 10

6. U.K. to join transPacific partnership trade treaty - Page 11

Page 6. GS III (Science, Economics)
• India – US MoU: Ensure that subsidies by each country do not come
in the way of India’s semiconductor dreams. India plans to set up a
greenfield 300mm wafer fabrication plant costing over $10 billion for
which we are seeking investment from Intel. But there has been lack
of interest from Intel.

• The Semi-Conductor Laboratory (SCL) was set up in Mohali in 1983 by

the then central government. Opening up of markets for consumer
goods in 1991 and a fire that broke out in 1989 at the SCL, hit India’s
ambitions. Despite some funding from central govt, the facility never
become ground-breaking. But this can be a good beginning point for
India’s ambitions.
 Possible way forward
∙ Recently, SCL was transferred back to the Ministry of Electronics and
Information Technology (MeITy) after a 15-year stint as a laboratory
within the Department of Space, but no joint venture partner has
been found. MeITy has been trying to attract Intel since then.
∙ An alternate approach - Use human and capital assets at the SCL to
build on what exists in a targeted manner, in a class of
semiconductors that do not need advanced lithography equipment.
Focus on segment of >180 nm node which would need lesser
investment and may result in the development of Indian solutions
for automotive electronics (EV traction inverters/on board chargers),
PV-Inverters, 5G infra-power amplifiers, railway electronics (traction
inverters), creating the Indian equivalent of Bosch, Siemens, ABB,
Mitsubishi Electric, Thales and ELTA.
∙ Govt needs to offer subsidies to focus on products aimed at
India-specific markets such as motor drives for BLDC fans or e-bike
chargers.
Beyond the writeup: Moore’s law
• Moore's Law asserts that the number of transistors on a
microchip doubles every two years.
• According to the law, we may anticipate the speed and
capabilities of our computers to rise every two years as a
result of this, but we will pay less for them.
• Another premise of Moore's Law states that this increase is
exponential.
• Gordon Moore, Intel's co-founder and former CEO, is
credited with inventing the law.
Beyond the writeup: “More than Moore”
• The "More than Moore" concept refers to a trend in the semiconductor
industry to focus on developing new technologies and functionalities
beyond traditional Moore's Law scaling of integrated circuits.
• More than Moore technologies include a wide range of solutions that
can enhance the performance, functionality, and diversity of integrated
circuits beyond traditional scaling.
• These technologies can include new materials, 3D integration,
heterogeneous integration, and system-level integration. Examples of
more than Moore technologies include sensors, MEMS devices, power
management, RF and analog circuits, and photonics.
Beyond the writeup: India Semiconductor mission
• The ISM was launched in 2021 with a total financial outlay of Rs76,000
crore under the aegis of the Ministry of Electronics and IT (MeitY). The
programme aims to provide financial support to companies investing in
semiconductors, display manufacturing and design ecosystem. Envisioned
to be led by global experts in the Semiconductor and Display industry,
ISM will serve as the nodal agency for efficient, coherent and smooth
implementation of the schemes.

Components:
∙ Scheme for setting up of Semiconductor Fabs in India
∙ Scheme for setting up of Display Fabs in India
∙ Scheme for setting up of Compound Semiconductors / Silicon Photonics
/ Sensors Fab and Semiconductor Assembly, Testing, Marking and
Packaging (ATMP) / OSAT facilities in India
∙ Design Linked Incentive (DLI) Scheme:
Beyond the writeup: India Semiconductor mission -
Significance

∙ It will formulate a comprehensive long-term strategy for developing

semiconductors & display manufacturing facilities and semiconductor
design ecosystem in the country.
∙ It will facilitate the adoption of trusted electronics through secure
semiconductors and display supply chains, including raw materials,
specialty chemicals, gasses, and manufacturing equipment.
∙ It will enable a multi-fold growth of Indian semiconductor
design industry by providing requisite support in the form of Electronic
Design Automation (EDA) tools, foundry services and other suitable
mechanisms for early-stage startups.
∙ It will also promote and facilitate indigenous Intellectual Property
(IP) generation and encourage, enable and incentivize Transfer of
Technologies (ToT).
∙ ISM will enable collaborations and partnership programs with national
and international agencies, industries and institutions for catalyzing
collaborative research, commercialization and skill development.
Page 7. GS III (Economics)
March 20 – IMF approved a $3 billion loan aimed at restoring
economic stability and growth in Sri Lanka. The IMF deal for Sri
Lanka — its 17th since 1965 — entails a $3 billion loan over four
years based on several conditions, including arresting corruption. An
IMF governance diagnostic mission has started to assess Sri Lanka’s
governance and anti-corruption framework in the agency’s first such
exercise in Asia.

The government hopes to tap more rapid credit, including from

other multilateral agencies such as the World Bank and the Asian
Development Bank. A year after defaulting on its sovereign debt, Sri
Lanka is looking to borrow more to stabilise its economy.
 Impact of the crisis
• In 2022 – inflation – over 90%; Economy
contraction about 8%.
• The government’s exuberant celebration of Sri
Lanka’s 75th year of Independence also came
under attack from some. Detractors see no
justification for pomp when authorities postpone
local government elections citing the lack of funds,
or seek urgent private funding to keep the
country’s critical ambulance service afloat.
• The World Food Programme found that a third of
Sri Lankan families continue to be food insecure.
• The World Bank estimated that between 2021 and
2022, poverty doubled to 25% in Sri Lanka. During
the same period, urban poverty tripled
Recovery?
• Trade unions protesting tax hikes or moves to privatise
have been labelled “disruptors” standing in the way of
stability and recovery. Most unions are not protesting
the IMF programme per se, but the specific austerity
measures that they associate with increased economic
hardships.

• Official estimates show that more than a million Sri

Lankans left the country in 2022.
 Beyond the writeup: Background to Sri
Lanka’s economic crisis
• When Sri Lanka emerged from a 26-year long civil war in
2009, its post-war GDP growth was reasonably high at 8-9% per
annum till 2012. However, its average GDP growth
rate almost halved after 2013 as global commodity prices fell,
exports slowed down and imports rose.

• Sri Lanka’s budget deficits were high during the war and
the global financial crisis of 2008 drained its forex reserves which
led to the country borrowing a USD2.6 billion loan from
the IMF in 2009.
 Beyond the writeup: Factors behind Sri
Lanka’s economic crisis
• The Easter bomb blasts of April 2019
∙ In 2019 new govt promised lower tax rates and wide-ranging
SoPs for farmers during their campaign.
∙ The Covid-19 pandemic
∙ Exports of tea, rubber, spices and garments suffered.
∙ Tourism arrivals and revenues fell further
The Crisis in Sri Lanka is triggered due to a shortage of foreign
exchange (forex) reserves, which have dropped by 70% over the
last two years to just USD 2 billion by the end of February 2022.
Meanwhile, the country has foreign debt obligations of about
USD 7 billion for 2022.
∙ Sudden Move to Organic Farming
∙ China’s Debt Trap
Page 1. GS III (Economics)
• GoI unveiled a new Foreign Trade Policy that moves away from
providing incentives to exporters, but lowers a few costs for
smaller firms and promises swifter clearances, along with a
one-time amnesty scheme for export obligation defaults. The new
policy kicks in from 2023-24 and aims to almost triple India’s
goods and services exports to $2 trillion by 2030, from an
estimated $760 billion in 2022-23.

∙ No major new schemes in the new policy

 Highlights of the Policy
• New growth areas: Opening up a new area of potential
exports, the policy has included “merchanting trade”
within its ambit. Exporters in India can source goods
from another country and send them to a third country
without touching Indian shores. This will also enable
exports of restricted goods.

• One-year amnesty : For exporters that have not been

able to fulfil their obligations under the EPCG and
advance authorisation schemes. This is the first
amnesty scheme since 2011-12, and can help exporters
close their unfulfilled obligations and raise exports
going forward.
 Highlights of the Policy
• Outreach Plan: A Special advance authorisation scheme
is being launched for the clothing and apparel sector so
that they can react to market demands and fashion
trends faster. Other mechanisms like star ratings to
recognise exporters will be rejigged to lower
qualification thresholds.
• Four towns in Uttar Pradesh — Faridabad, Moradabad,
Mirzapur and Varanasi — were announced as centres of
export excellence for their performance in the apparel,
handicrafts, handmade carpets and handlooms,
respectively. The new trade policy will make all the PM
Mitra textile parks eligible to get benefits as common
services providers.
Beyond the writeup: Summarized version of
the FTP
• FTP to provide the policy continuity and a
responsive framework
• Approach of FTP: From Incentive to Remission
• Introduces scheme for remission of duties, taxes
and govt levies on export goods
• Digitisation of applications pertaining to FTP
• Automatic system-based approval of FTP
applications
Beyond the writeup: Summarized version of
the FTP
• Pilot introduced for cutting processing of applications related to
advance authorisation to 1 day
• Norms for recognition as Star Trading Houses eased
• Promotes trade in Indian Rupee
• Introduces provisions for merchanting trade
• Dairy sector to be exempted from maintaining average export
obligation * Battery electric vehicles; vertical farming equipment &
green hydrogen eligible for reduced obligation under Export
Promotion Capital Goods (EPCG) scheme
• Special advance authorization scheme extended for apparel &
clothing sector
Beyond the writeup: Summarized version of
the FTP
• Extends all FTP benefits to e-commerce exports

• Value limit for exports through courier service increased from Rs 5 lakh to Rs
10 lakh per consignment

• Focus on engaging with states & districts through Districts as Export Hubs
initiative

• Aims at streamlining export of dual use items under SCOMET policy

• Introduces amnesty scheme for one-time settlement of default in export

obligation by advance authorisation and EPCG authorisation holders

• FTP to be dynamic and responsive to the emerging trade scenario

• Restructuring of Department of Commerce on the anvil to make it

future-ready
Prelims Bytes!
Page 9. GS II (Governance)
The Department of Personnel and Training has reviewed a proposal from the Ministry of
Electronics and Information Technology to include CERT-in in the Second Schedule to the
RTI Act, which deals with exempted organisations like the CBI and BSF.
The exemption would allow CERT-in to reject any application for information, even on
policy related matters. This is significant in light of the April 2022 directions the body issued
to require Virtual Private Network (VPN) providers and cryptocurrency firms to preserve
user requests.
CERT-in coordinates with public and private organisations in India when cyber incidents like
data breaches and ransomware attacks are reported. It also issues advisories for software
vulnerabilities as guidance for organisations.
Cert-In
• CERT-In is the national nodal agency for responding to
computer security incidents as and when they occur. The
constituency of CERT-In is the Indian Cyber Community.
CERT-In was established in 2004 as a functional organization
of the Ministry of Electronics and Information Technology.

• Functions: The Information Technology (Amendment) Act

2008 designated CERT-In to serve as the national agency to
perform the following functions in the area of cyber
security.
 Beyond the writeup: Functions of
Cert-In
• Collection, analysis and dissemination of information on cyber
incidents.

∙ Forecast and alerts of cyber security incidents

∙ Emergency measures for handling cyber security incidents
∙ Coordination of cyber incident response activities.
∙ Issue guidelines, advisories, vulnerability notes and whitepapers
relating to information
∙ security practices, procedures, prevention, response and reporting
of cyber incidents.
∙ Such other functions relating to cyber security as may be prescribed.
Beyond the writeup: RTI exempted
organizations
Page 10. GS I (Geography)
• Lithium is a critical metal necessary to make batteries for electric
vehicles.
• The European Union and South Korea have vehemently criticised
the American IRA on the grounds that it made electric vehicles
imported into the U.S. from their regions uncompetitive. Amitabh
Kant, India’s G20 Sherpa has also labelled the Act “as the most
protectionist in the world.”
• One of the clauses of the Act required that at least 40% of all the
‘critical minerals’ (which includes lithium) that go into making
electric batteries must come from countries with a Free Trade
Agreement with the United States.
• Australia is the world’s biggest exporter of lithium with most of it
going to China, which dominates the lithium-ion battery
production market.
• India Australia recently signed an agreement to invest $3 million
each to investigate the prospects of Indian investments into two
lithium- and three cobalt- prospecting projects in Australia.
 Beyond the writeup: Lithium reserves

South America is a particularly rich supply of the metal, the three nations
of Bolivia, Chile, and Argentina are collectively referred to as the ‘Lithium
Triangle’. China currently controls 77% of the global lithium-ion battery
manufacturing capacity and is home to 6 of the world’s 10 manufacturing
companies.
Page 11. GS II (International Relations), GS III
(Economics)
The U.K., acceded to the Comprehensive and
Progressive Agreement for Trans-Pacific
Partnership (CPTPP). The agreement will now need
to be ratified by Westminster and each of the
CPTPP countries. The 11-member Asia-Pacific
trading bloc, without the U.K. accounts for some
13% of global GDP.
It would mean that more than 99% of British
exports — including for key markets such as
cheese, cars, chocolate, machinery, gin and whisky
— would have zero tariffs. It would add GBP 1.8
billion ($2.2 billion) annually to the U.K. economy
in the long run.
• U.K. is currently also negotiating a “free trade” deal with India. It will
also, as a CPTPP member, get a veto on whether China joins the
treaty. Beijing had applied to become a member of the bloc in
September 2021.

• Downing Street highlighted some of the benefits of the CPTPP —

such as a cut in whisky and car tariffs for British goods going to
Malaysia. Services — which are a key U.K. export — accounted for
43% of exports to CPTPP countries last year. Once Britain becomes a
member of the bloc, U.K. firms will not need to establish a local office
or be resident to provide services and will be able to operate on a par
with firms in host countries.
 Beyond the writeup: CPTPP
• The CPTPP is a Free Trade Agreement (FTA) between 11 countries around
the Pacific Rim which are : Canada, Mexico, Peru, Chile, New Zealand,
Australia, Brunei, Singapore, Malaysia, Vietnam and Japan.

• After the US withdrew from negotiations of Trans-Pacific Partnership

(TPP), the remaining 11 participants scrambled to amend the text of the
agreement, and the newly renamed CPTPP was signed in March 2018. It came
into force in December 2018.

• Removes Tariffs: The CPTPP removes 99% of tariffs on goods and services,
just like the original TPP did.

• Broad Coverage: The CPTPP covers a broad range of goods and services.
These include financial services, telecommunications, and food safety
standards.

• Reduces Environmental Abuses: All countries agreed to cut down on wildlife

trafficking. That helps elephants, rhinoceroses, and marine species the most.
It prevents environmental abuses, such as unsustainable logging and fishing.
Countries that don't comply will face trade penalties.
 Mains Practice Questions
1. Throw on the significant features of India’s new FTP. How is
India’s new foreign trade policy different as compared to the
earlier policy? (250 words; 15 marks)

2. For India’s semiconductor mission to be a success, the

government must play a big role. Comment. (250 words; 15
marks)