ECONOMY OPEN SECRET 2024

LECTURE - 1
Dated - 30-08-2023

These are 27 month's current affairs ( 1 June 2022 to 10 September 2024 )

of Economy from 4 best newspapers, 4 top websites & 2 magazines,
these current affairs are for both prelims and mains 2024.

Retrospected from 4 books, Multiple newspapers, websites & internet

 What in news : Digital India campaign & digital economy

av
Why in news : G20 discussion

e yad
Frequency : Multiple times

t
Probability in exam : High

sh han
Specific for : Mains 2024

s
ar
t t ra
no l - p
Digital India's Impact on Financial Inclusivity and Global Digital N O T E S
o
Economy - An analysis
tra

av
en

e yad
sc

The Digital India campaign, initiated in 2015, aimed to enhance national

t
sh han
Ia

financial inclusivity. The campaign focuses on leveraging technology for

improved governance and inclusivity.

s
ar
t t ra
no l - p
o
Speaking at the G20 Ministers of Digital Economy meeting in Bengaluru,

tra
the focus was on India's diversity as a resource. This diversity supports

en
testing and solutions for new digital products globally. Consensus

sc
building on G20 high-level principles for a secure, trusted, and resilient

Ia
av

digital economy is deemed crucial.

e yad

The global spread of the digital economy brings forth security threats
t
sh han

and challenges. Building consensus on secure digital economy

principles within G20 offers an opportunity to establish a foundation for
s
ar
t t ra

an inclusive, prosperous, and secure global digital future.

no l - p
o
tra

Digital Transformation and Inclusive Governance

en

Over the past nine years, India's digital transformation has been
sc

remarkable.
Ia

The Digital India initiative's foundation rests on innovation and a

commitment to speedy implementation.
India's digital economy is positioned as an enabling system, promoting
av

inclusive and transparent governance.

e yad
t

Leveraging Aadhaar and Digital Systems

sh han

India's Aadhaar digital identity has wide-reaching impact, covering over

s
ar
t t ra

1.3 billion citizens.

no l - p

The JAM trinity (Jan Dhan Bank accounts, Aadhaar, and Mobile) has
o
tra

revolutionized financial inclusion.

en

Monthly UPI transactions total nearly 10 billion, contributing to more

sc

than 45% of global real-time payments.

Ia
av
e yad

Emphasis on Ethical Governance and Innovation

av
t

The digital ecosystem in India contributes to enhanced governance

e yad
sh han

probity.
t
s

sh han
ar
t t ra

India's commitment to innovation and the application of technology

no l - p

reflects in its achievements.

ar
t t ra
o
tra

no l - p
o
en

Advancements in Language Translation

tra
sc

The announcement of "Bhashini", an AI-powered language translation

en
Ia

platform, reflects India's technological strides.

sc

This platform, available in all Indian languages, further enhances

Ia

accessibility and inclusivity.

 Diversity as a Strength
India's diverse landscape, encompassing languages, dialects, religions,
N O T E S

av
and cultural practices, positions it as an ideal testing lab.

e yad
Solutions that succeed in India can serve as models for global

t
sh han
implementation.

s
ar
t t ra
no l - p
Here are some of the key achievements of the Digital India campaign:
o
Over 1.3 billion people have been issued Aadhaar digital identities.
tra

av
Over 1 billion bank accounts have been opened under the Pradhan
en

e yad
Mantri Jan Dhan Yojana (PMJDY) scheme.
sc

t
Over 600 million people have been connected to the internet.

sh han
Ia

Over 300,000 public Wi-Fi hotspots have been set up.

s
ar
t t ra
Over 10 billion digital transactions are conducted every month.

no l - p
o
tra
The Digital India campaign is still ongoing, and it is expected to have a major

en
impact on the country's digital transformation in the years to come.

sc
Ia
av

Here are some of the challenges that the Digital India campaign faces:
e yad

The digital divide between urban and rural areas.

t

The lack of digital literacy among the population.

sh han

The security risks associated with the digital economy.

s
ar
t t ra
no l - p

Similar questions in past years : Question on central bank digital

o
tra

currencies in prelims 2023, then question on G20 finance ministers in

en

prelims 2023
sc
Ia

What in news : Priorities identified for digital economy

Why in news : PM’s vision and G20 association
Frequency : 4-5 times
av

Probability in exam : Very high

e yad

Specific for : Prelims and mains 2024

t
sh han

During the G20 Digital Economy Working Group Ministers Meet, three
s
ar
t t ra

priority areas identified by India's presidency for the digital economy

no l - p
o

Working Group are :

tra
en

Digital Public Infrastructure (DPI): This priority aims to democratize

sc

technology and ensure its benefits reach every citizen regardless of

Ia
av

socio-economic status. Examples include India's digital payments

e yad

av

platform UPI, which demonstrates the success of a public-private

t

e yad
sh han

partnership.
t
s

sh han
ar
t t ra

Security in the Digital Economy: With the increasing frequency of digital

no l - p

s
ar

transactions, building trust in technology is crucial for its widespread

t t ra
o
tra

no l - p

adoption. Measures to promote security involve awareness building and

o
en

education.
tra
sc

en
Ia

sc

Digital Skilling: The creation of a future-ready workforce is essential for

Ia

the digital economy. Investing in talent development is critical to

address the evolving demands of the digital landscape.
 What in news : UAE FDI in India and growth of bilateral relations

av
Why in news : UAE came on rank 4 in FDI

e yad
Frequency : Multiple times

t
Probability in exam : Very high

sh han
Specific for : Prelims 2024 ( Rankings ) and Mains GS 2 and GS 3

s
ar
t t ra
no l - p
The United Arab Emirates (UAE), with which India established a
o
Comprehensive Economic Partnership Agreement (CEPA) in May of the
N O T E S
tra

av
previous year, has become the fourth largest investor in India during the
en

e yad
fiscal year 2022-23, as indicated by government data.
sc

t
sh han
Ia

Foreign Direct Investment (FDI) from the UAE to India experienced a

s
ar
t t ra
substantial increase, rising over three-fold to $3.35 billion in the last

no l - p
fiscal year from $1.03 billion in 2021-22, based on data from the

o
tra
Department for Promotion of Industry and Internal Trade (DPIIT).

en
sc
In the fiscal year 2022-23, the UAE was ranked as the fourth largest

Ia
av

investor in India, a notable rise from its seventh position in the

e yad

preceding fiscal year.

t
sh han

The largest investors in India in FY23 were Singapore with $17.2 billion,
followed by Mauritius with $6.1 billion, and the U.S. with $6 billion.
s
ar
t t ra

The strengthening bilateral ties and investment cooperation between

no l - p

India and the UAE can be attributed to strong bilateral relations, growth
o
tra

in investment commitments from the UAE, and policy reforms to

en

facilitate ease of doing business between the two nations.

sc
Ia

The sectors that UAE's investments in India primarily target include

services, sea transport, power, and construction activities.
The signing of the CEPA between India and the UAE on February 18,
av

2022 (effective from May 1, 2022) has been a crucial factor in boosting
e yad

FDI from the UAE to India.

t

The UAE has pledged to invest $75 billion in India's infrastructure sector
sh han

over time and has shown commitment to partnering with India in the
s
ar
t t ra

renewable energy sector.

no l - p

The CEPA allows certain goods from both countries to have zero-duty
o
tra

access to each other's markets and eases norms to promote

en

investments.
sc
Ia
av

UAE's contributions to India's total FDI between April 2000 and March
e yad

2023 stand at about 2.5%, amounting to $5.6 billion in overseas inflows.

av

Trade agreements have led to increased import and export between the
t

e yad
sh han

two nations, contributing to higher investments from the UAE in Indian

t
s

sh han
ar

companies.
t t ra
no l - p

India's liberalization of FDI policies and the expansion of Indian

s
ar
t t ra
o

startups into the UAE have also boosted such investments.

tra

no l - p
o
en

tra
sc

The Abu Dhabi Investment Office, through its Innovation Program,

en
Ia

actively supports innovation-driven startups by providing financial and

sc

non-financial incentives, which encourages UAE-based investment

Ia

funds to invest in Indian startups.

 What in news : RBI's Guidelines for Compromise Settlements and

av
Recovery

e yad
Why in news : Long sought change

t
Frequency : 5+ times

sh han
Probability in exam : High

s
ar
t t ra
Specific for : Prelims & mains 2024
no l - p
o
RBI's Directive for Recovery: The RBI permits banks to pursue
N O T E S
tra

av
compromise settlements for fraud accounts and wilful defaults to
en

e yad
enhance recovery from distressed assets.
sc

t
sh han
Ia

Policy Requirement: All regulated entities (REs) must establish board-

s
ar
t t ra
approved policies for compromise settlements and technical write-offs,

no l - p
detailing the process and necessary conditions.

o
tra
en
Conditions for Settlements: Conditions include factors like minimum

sc
aging of the debt and deterioration in collateral value.

Ia
av
e yad

Staff Accountability: Policies must outline a framework for evaluating

t

staff accountability with set thresholds and timelines.

sh han
s
ar
t t ra

Scope of Settlements: REs can undertake compromise settlements or

no l - p

technical write-offs for wilful defaulters or fraud accounts, regardless

o
tra

of ongoing criminal proceedings.

en
sc

Settlement Criteria: Policies should include provisions for allowable

Ia

concessions based on exposure categories, considering current

realizable security value. av

Security Valuation Methodology: The methodology for determining

e yad

security value should be part of the policy.

t
sh han

Objective: The goal is maximum recovery from distressed borrowers

s
ar
t t ra

with minimal expense, favoring the Regulated Entity (RE).

no l - p
o
tra

Precedence of Claims: Settlements and write-offs won't affect agreed-

upon future recoveries, not recognized on RE balance sheets during
en
sc

settlement.
Ia
av
e yad

Restructuring Impact: Claims on RE balance sheets could trigger

av

restructuring treatment as per guidelines.

t

e yad
sh han

t
s

sh han
ar

Cooling Period: For borrowers in compromise settlements, a cooling

t t ra
no l - p

period is determined by board-approved policies before assuming new

s
ar
t t ra
o

exposures.
tra

no l - p
o
en

tra
sc

Cooling Period Duration: Excluding farm credit, a 12-month minimum

en
Ia

cooling period applies; REs can set longer periods.

sc

Farm Credit Exposures: Cooling period duration for farm credit is at the
Ia

discretion of REs based on board-approved policies.

 Meanings :
Regulated Entities (REs): Financial institutions under regulatory
N O T E S

av
e yad
oversight, such as banks, subject to rules set by the Reserve Bank of
India (RBI).

t
sh han
Board-Approved Policies: Guidelines and procedures endorsed by the

s
ar
governing board of a financial institution.
t t ra
no l - p
Cooling Period: A waiting period imposed before new transactions or
o
exposures with a borrower who has settled or compromised their debt.
tra

av
Staff Accountability: Holding bank employees responsible for their
en

e yad
actions and decisions related to compromised settlements and write-
sc

t
sh han
offs.
Ia

Technical Write-offs: Removal of a non-performing asset from the books

s
ar
t t ra
of a bank, essentially acknowledging that it's unlikely to be recovered.

no l - p
o
tra
Similar questions in past years : Question on rules of MSME act in

en
prelims 2023, then 1 questions on INVIts and their rules in prelims 2023

sc
Ia
av

Agriculture & Agritech

e yad
t
sh han
s
ar
t t ra

What in news : Enhancing Urea Efficiency Through Fortification for

no l - p
o

Better Crop Yields

tra

Why in news : Launch of “Urea gold”

en

Frequency : 5+ times
sc

Probability in exam : Very High

Ia

Specific for : Prelims and mains 2024

Introduction
av

Urea fortified with micronutrients is proposed to increase its

e yad

effectiveness as a fertilizer.
t
sh han

Fortification aims to boost crop yields and improve the efficiency of

imported nutrients.
s
ar
t t ra

The topic discusses the recent launch of 'Urea Gold' as an example of

no l - p

fortified urea.
o
tra
en

Urea Gold: A Fortified Fertilizer

sc

Urea Gold is developed by Rashtriya Chemicals and Fertilizers Ltd (RCF)

Ia
av

and contains sulphur along with nitrogen.

e yad

Sulphur deficiency in Indian soils, especially in oilseeds and pulses, is

av
t

e yad

addressed by this fortification.

sh han

The slow release of nitrogen due to sulphur coating enhances nitrogen

t
s

sh han
ar
t t ra

use efficiency (NUE) and prolongs plant greening.

no l - p

s
ar
t t ra
o
tra

no l - p

Benefits of Urea Gold

o
en

Prolonged urea action leads to extended crop greening, reducing the

tra
sc

need for frequent applications.

en
Ia

Potential reduction in fertilizer usage: Farmers may need fewer bags for
sc

the same yield.

Ia
 Urea Gold's Pricing, Weight, and Commercial Availability are still under

av
discussion.

e yad
Challenges in Urea Consumption

t
sh han
Urea is widely used in India, with consumption rising over the years.

s
ar
Concerns over increasing consumption due to dependence on imports
t t ra
no l - p N O T E S
and depleting natural resources.
o
Nutrient use efficiency (NUE) is a critical concern; only 35% of nitrogen
tra

av
applied through urea benefits crops.
en

e yad
sc

t
sh han
Ia

The Fortification Solution

Growing consensus on the need to fortify fertilizers, including urea and

s
ar
t t ra
DAP, with micronutrients.

no l - p
o
Secondary nutrients (sulphur, calcium, magnesium) and micronutrients

tra
(zinc, boron, manganese, etc.) improve fertilizer effectiveness.

en
Coating enhances nutrient use efficiency and reduces losses from

sc
ammonia volatilization and nitrate leaching.

Ia
av
e yad

Yara's Micronutrient Coating Technology ( Yara International: A large crop

t
sh han

nutrition company from Norway).

Yara International's 'Procote' technology coats fertilizers with
s
ar
t t ra

micronutrients ( Essential elements needed in small quantities for plant

no l - p
o

health ).
tra

Indian subsidiary introduced 'Procote Zn' for urea coating during the
en

2022 kharif season.

sc

Coating with Procote Zn simplifies application and improves uniform

Ia

distribution of micronutrients

Challenges in Fortification Adoption

av

Current subsidies for coated fertilizers are not attractive enough for
e yad

companies to market them.

t

The article suggests setting free Maximum Retail Prices (MRPs) for
sh han

coated fertilizers to encourage adoption.

s
ar
t t ra

Factory-level coating can ensure uniform micronutrient distribution,

no l - p

potentially saving farmers from mixing hassles.

o
tra
en

Way Forward
sc

Fortified fertilizers have demonstrated benefits in trials, including

Ia
av

increased yields and nutrient efficiency.

e yad

Adoption requires addressing pricing challenges and incentivizing

av
t

manufacturers to produce and market fortified products.

e yad
sh han

The government's role in setting policies and subsidies for fortified

t
s

sh han
ar
t t ra

fertilizers is crucial.
no l - p

s
ar
t t ra
o
tra

no l - p

Similar questions in past years : Question on Gm seeds in prelims 2022

o
en

and question on fertilisers prelims 2023 + regular questions on fertiliser

tra
sc

improvements in mains
en
Ia

sc
Ia
 Short & crisp current affairs and one liners

av
e yad
1- Top digital payments ranking countries :

t
India has emerged as a global leader in digital payments, registering a

sh han
remarkable 89.5 million digital transactions in 2022, according to data

s
ar
N O T E S
t t ra
provided by MyGovIndia. This achievement underscores India's
no l - p
prominent position in the digital payments landscape:
o
tra

av
en

1. India’s Top Rank: India secured the top spot among five countries in

e yad
sc

terms of digital payments. The nation's 89.5 million digital transactions

t
sh han
Ia

in 2022 accounted for a significant 46% of the global real-time

s
payments.

ar
t t ra
2. Brazil: Ranked second, Brazil recorded 29.2 million transactions.

no l - p
o
3. China in third place with 17.6 million transactions.

tra
4. Thailand: The fourth spot was taken by Thailand, having conducted 16.5

en
million digital transactions.

sc
5. South Korea followed with 8 million transactions.

Ia
av
e yad

The success of digital payments in India has been attributed to factors

t
sh han

such as affordable mobile data rates and a burgeoning rural economy.

This achievement reflects the robustness of India's payment ecosystem,
s
ar
t t ra

indicating the widespread acceptance and growth of digital

no l - p
o

transactions.
tra
en

2- ICRA and moody’s association

sc

ICRA is an Indian credit rating agency established in 1991. It is a public

Ia

limited company, listed on the Bombay Stock Exchange and National

Stock Exchange.
The ultimate parent company is Moody's Investors Service, a global
av

credit rating agency. Moody's owns a significant stake in ICRA.

e yad

ICRA is a leading credit rating agency in India, providing ratings to

t
sh han

entities like banks, financial institutions, corporates, and governments.

ICRA's ratings assist investors, lenders, and stakeholders in making
s
ar
t t ra

informed decisions.
no l - p
o
tra

Key Benefits of ICRA as Moody's Affiliate:

en

ICRA accesses Moody's global research base, gaining a competitive

sc

advantage in ratings and research.

Ia
av

Moody's credit rating expertise ensures the quality of ICRA's ratings.

e yad

ICRA's strong brand name builds trust with clients.

av
t

e yad
sh han

3- What is Twin-Balance Sheet Problem to Advantage:

t
s

sh han
ar
t t ra

The twin-balance sheet problem refers to : the situation in which both

no l - p

s
ar

banks and corporates face financial distress simultaneously. This can

t t ra
o
tra

no l - p

have a negative impact on the overall economy.

o
en

The twin-balance sheet advantage : is the situation in which the

tra
sc

financial health of both banks and corporates has improved. This can
en
Ia

lead to a boost in lending, investment, and economic growth.

sc
Ia
 The Indian economy is now said to be benefiting from the twin-balance
sheet advantage, thanks to the government's efforts to address the
N O T E S

av
problem.

e yad
The NPAs of banks have declined significantly in recent years, and the

t
sh han
profit of public sector banks has tripled. This shows that the financial

s
health of banks has improved.

ar
t t ra
no l - p
The twin-balance sheet advantage is a positive development for the
o
Indian economy. It will help to boost lending, investment, and economic
tra

av
growth.
en

e yad
sc

t
sh han
Ia

s
ar
t t ra
no l - p
o
tra
en
sc
Ia
av
e yad
t
sh han
s
ar
t t ra
no l - p
o
tra
en
sc
Ia

av
e yad
t
sh han
s
ar
t t ra
no l - p
o
tra
en
sc
Ia
av
e yad

av
t

e yad
sh han

t
s

sh han
ar
t t ra
no l - p

s
ar
t t ra
o
tra

no l - p
o
en

tra
sc

en
Ia

sc
Ia