DAILY CURRENT AFFAIRS IAS | UPSC Prelims and Mains Exam – 15th March 2025
Archives (PRELIMS & MAINS Focus) LAWS GOVERNING IMPORT OF GOLD Syllabus: Prelims & Mains – CURRENT EVENT Context: A Special Court of Economic Offences in Bengaluru rejected the bail plea of Kannada actor Ranya Rao, who was arrested for allegedly smuggling over 14 kilograms of gold on a flight from Dubai to Bengaluru. Background: – Directorate of Revenue Intelligence (DRI) officials called it one of the biggest seizures of gold at Bengaluru airport in recent times. Key takeaways Until its repeal in 1990, the Gold (Control) Act, 1968, curbed gold imports and placed heavy restrictions on the acquisition, possession, and disposal of gold in India. However, with liberalisation in 1990s, the government modified its approach, imposing an import duty on gold. Now, gold imports are largely governed under the Customs Act, 1962, and by the Central Board of Indirect Taxes and Customs (CBIC). The customs duty for gold may differ depending on the amount of gold carried by a passenger and the duration spent abroad before traveling back to India, as per the Baggage Rules, 2016 (issued under the Customs Act). Under these rules, a man residing abroad for over a year may carry up to 20 grams of jewellery duty free (with a value cap of Rs 50,000) and a woman may similarly carry up to 40 grams (with a cap of Rs 1 lakh). The CBIC also has specific guidelines for Indian passengers returning from Dubai after residing there for over six months, allowing them to carry up to 1 kg of gold as long as the applicable customs duty is paid. In 2003, the Supreme Court held that any article imported without complying with the relevant conditions or restrictions must be considered a “prohibited good”. Such goods are liable to be confiscated under Section 111 and punished under Section 112 of the Customs Act. The punishment may include a fine of up to the value of the goods. Section 135 provides a punishment of up to 7 years imprisonment if the market price of the smuggled goods exceeds Rs. 1 lakh. Smuggling is also punishable under Section 111 (Organised Crime) of the Bharatiya Nyaya Sanhita, 2023, which punishes “trafficking in illicit goods” with imprisonment of at least five years, extendable to life imprisonment. The UAPA also carries the same punishment for smuggling as a “terrorist act” under Section 15 if it causes “damage to the monetary stability of India”. Source: Indian Express DIFFERENT TYPES OF BONDS Syllabus: Prelims & Mains – ECONOMY Context: The Sovereign Green Bonds (SGrBs) in India has received a luke response. The two new SGrBs worth Rs 10,000 crore auctioned in November and January faced muted response as bonds valued at Rs 7,443 crore remained unsold. This came despite a rule change allowing NRIs and foreign portfolio investors to participate without restrictions. Background: – The government’s inability to raise adequate proceeds through bonds increases fiscal constraints. Key takeaways A bond is an instrument to borrow money. A bond could be floated/issued by a country’s government or by a company to raise funds. Since government bonds (referred to as G-secs in India, Treasury in the US, and Gilts in the UK) come with the sovereign’s guarantee, they are considered one of the safest investments. As a result, they also give the lowest returns on investment (or yield). The yield of a bond is the effective rate of return that it earns. But the rate of return is not fixed — it changes with the price of the bond. Sovereign Green Bonds Sovereign green bonds (SGrBs) are those that are issued by sovereign entities, like the Government of India, which formulated a framework for issuing such bonds in 2022. The framework defines “green projects” as those that encourage energy efficiency in resource utilisation, reduce carbon emissions, promote climate resilience, and improve natural ecosystems. Masala Bonds Masala Bonds are rupee-denominated bonds i.e. the funds would be raised from the overseas market in Indian rupees. According to RBI, any corporate, body corporate, and Indian bank is eligible to issue rupee-denominated bonds overseas. Advantages of Masala Bonds : Lower Cost of Borrowing: Interest rates may be lower compared to domestic borrowing. Diversification of Funding Sources: Enables Indian companies to access global capital markets. Boosts Rupee Internationalization: Encourages wider acceptance of the Indian rupee in global finance. Foreign Investors Bear Currency Risk: If the rupee depreciates, investors receive fewer dollars upon conversion, making it riskier for them. Social Impact Bonds Social Impact Bonds (SIBs) are innovative financial instruments designed to fund social programs through a results-based approach. Unlike traditional bonds, SIBs do not provide fixed returns to investors. Instead, returns are linked to the achievement of predefined social outcomes (e.g., reducing unemployment, improving public health, or enhancing education). How SIBs Work? Government/Authority Identifies a Social Issue: A government or public sector entity defines a social problem that needs intervention. Investors Provide Upfront Capital: Private investors or philanthropic organizations fund the project. Service Providers Implement the Program: Non-profits or social enterprises execute interventions to achieve the desired impact. Independent Evaluation: Third-party assessors measure the project’s success based on pre-agreed metrics. Outcome-Based Repayment: If the project meets its goals, the government repays investors with a return. If the project fails, investors may lose part or all of their investment. Key Features Pay-for-Success Model: Government pays only if the intervention achieves measurable results. Risk Transfer: Shifts financial risk from the public sector to private investors. Encourages Innovation: Service providers have flexibility in implementing evidence-based solutions. Examples of Social Impact Bonds : India’s Educate Girls Development Impact Bond (2015): Focused on improving girls’ education in Rajasthan. Source: Indian Express CORONAL MASS EJECTIONS (CMES) Syllabus: Prelims & Mains – SCIENCE & TECHNOLOGY Context: Scientists from the Indian Institute of Astrophysics (IIA) have reported observations of a flareless coronal mass ejection (CME) from the solar atmosphere with the Visible Emission Line Coronagraph (VELC) instrument onboard Aditya-L1 mission. Background: The Aditya-L1 mission is India’s first scientific mission dedicated to studying the sun. Key takeaways Coronal Mass Ejections (CMEs) are massive bursts of solar plasma and
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