Current Affairs Current Affairs - 18 December 2017 - Vikalp Education

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Current Affairs - 18 December 2017

General Affairs 

Railway Clears Rs. 12,000 Crore Plan To Make Trains Safer
  • The Indian Railways has cleared a Rs. 12,000-crore proposal to equip electric locomotives with the latest European train protection system.

    At its meeting on December 15, the Railway Board cleared the proposal to equip 6,000 electric locos with European Train Control System (ETCS) Level-II to help drivers - or pilots -- to prevent rail mishaps, a senior Railway Ministry official told IANS.

    Besides, the Board also decided to install the ETCS Level-II system on the entire 9,054 km-long Golden Quadrilateral route connecting the four metros to make it a fully accident-free corridor.

    The entire project to ensure ETCS Level-II compliance is expected to cost around Rs. 12,000 crore. 

    There are cases where accidents occur due to error of locomotive pilots who generally have to work in very stressful conditions.

    Currently, the Railways has a basic automatic train protection system based on the ETCS Level-I specification to provide a back-up to loco pilots on a limited stretch.

    Known as a "train protection warning system", the facility based on ETCS Level-I has been implemented on about 342 km of rail route. Gatiman Express, running at 160 kmph between Nizamuddin and Agra, safely runs at this speed protected by the system.

    However, it was decided to upgrade the system to put it on par with world standards as the ETCS Level-I has limitations.

    In a train protection warning system, information regarding the condition of the signals ahead -- whether it is showing red, yellow or green -- is communicated to the locomotive and is shown on a display screen called DMI (Driver Machine Interface) in the front of the loco pilot.

    In the ETCS Level-I system, this information regarding the condition of the signal ahead is periodically received in the loco whenever it passes over a device called "balise" which is fitted in the middle of the track at certain intervals.

    Thus this has a limitation that the information regarding the signal ahead is received only when a loco passes over a balise -- and the driver has to wait till he passes over the next balise to get updated information. 

    This disadvantage of the ETCS Level-I is overcome in ETCS Level-II, which ensures that the status of the signal ahead is continuously available in the loco through a wireless radio medium using a GSM-R (Global System for Mobile Communication-Railways) network.

    GSM-R is similar to the mobile GSM network with some special features for Railway applications. With the status of the signal continuously available, the driver can now run the train more efficiently, as per the movement authority available to him, thereby improving overall speed and the section capacity of the route.

    With the implementation of ETCS Level-II, the balise fitted on the track for communicating the status of signals are no longer required.

Congress Sweeps Civic Body Polls In Amritsar, Jalandhar, Patiala
  • The Congress, which came to power in Punjab earlier this year, continued its winning streak, sweeping the civic elections in Jalandhar, Patiala and Amritsar that were conducted today.

    Chief Minister Amarinder Singh hailed the results as a "clear vindication of the Congress policies and a resounding defeat of the opposition's deceitful propaganda". The opposition BJP and the Shiromani Akali Dal alleged that the ruling party had misused the state machinery and resorted to large-scale rigging in Patiala, where they had failed to open account.

    The party won 66 of 80 wards in Jalandhar Municipal Corporation, the BJP 8 and its ally, the Shiromani Akali Dal 4. Two wards went to Independents. In Patiala, the party bagged 59 of the 60 seats. In Amritsar, the Congress clinched 64 of 85 wards, the BJP 6, the Shiromani Akali Dal 7 and Independents 8.

    Polling was also held in 29 municipal councils and nagar panchayats amid tight security arrangements.

    Late in the evening, as the trends became clear, the Chief Minister issued a statement that congratulated the people "for not succumbing to the pressure tactics of the Opposition, which had tried hard to derail the free and democratic poll process with its cheap gimmickry and provocative acts".

    "The people had not forgotten what the Akalis had done for 10 years and had responded by voting them out of power in the Assembly elections and now handing them a crushing defeat in the local bodies' elections," the chief minister said.

    The SAD-BJP demanded that the elections in Patiala be scrapped. Meeting the state Election Commission, a delegation from the two parties said they had vidoegraphic evidence of alleged blatant rigging and violence in Patiala.

Training Over, India's First 3 Women Fighter Pilots Fly MiGs And Hawks
  • Less than two years after they were commissioned into the Indian Air Force as India's first women fighter pilots, Flying Officers Bhawana Kanth, Mohana Singh and Avani Chaturvedi have now joined their respective squadrons.  

    Flying Officer Avani Chaturvedi and Flying Officer Bhawana Kanth have been posted to 23 Squadron, Suratgarh (Rajasthan) and 3 Squadron, Ambala (Haryana) respectively.  Both officers are presently being trained to fly the MiG-21 Bison supersonic jet after having completed several stages of fighter aircraft training earlier.  

    In October, Air Force Chief Air Chief Marshal BS Dhanoa had said: "The present consideration is to put them to a MiG-21 Bison squadron. Our opinion is that it will sharpen their skills as the aircraft has more manual features than other sophisticated aircraft."

    The MiG-21 is the oldest frontline combat jet in service with the Indian Air Force, having first entered service in 1964.  Since then, the jet has been regularly upgraded.  The MiG-21 "Bison" being flown by Flying Officers Avani Chaturvedi and Bhawana Kanth is the definitive variant of the legacy fighter and will start being phased out of the IAF from 2019 onwards.

    Flying Officer Mohana Singh has been posted as a staff pilot with a Hawk trainer Operational Conversion Unit in Kalaikunda in West Bengal.  She will move to frontline combat jets when an appointment becomes available.

    Yesterday, two women from the second batch to enter the fighter stream of the Indian Air Force were commissioned after graduating from the Air Force Academy, Dundigul.  Flying Officers Pratibha and Shivangi Singh have completed their basic flying training and will now train further on Hawk Advanced Jet trainers before being posted to the Indian Air Force's fighter squadrons.  

    A third woman pilot, trainee Rashi Raina, was injured after she ejected from a Kiran trainer late last month near Hyderabad.  She survived with a fractured leg and could not graduate as fighter pilot yesterday. Her future as a potential fighter pilot remains uncertain presently.

    During Air Force Day in October 2015, then Air Chief Marshal Arup Raha had said,  "We have women pilots flying transport aircraft and helicopters, we are now planning to induct them into the fighter stream to meet the aspirations of young women of India".  

    "I have no doubt that women will be able to overcome any physical limitations to become fighter pilots," he had added.

Google Warns Action Against 'News' Sites Misleading Users
  • Amid a growing clamour against fake content online, Google has announced it may take off from its news index, the websites which conceal information about their ownership, primary purpose, country of origin or mislead users.

    In a set of new guidelines, the technology behemoth said it aims to organise the entire world's news and make it accessible to readers, while providing the best possible experience for those seeking useful and timely news information.

    "Do not misrepresent yourself or your purpose. Sites included in Google News must not misrepresent, misstate, or conceal information about their ownership or primary purpose, or engage in coordinated activity to mislead users. This includes, but isn't limited to, sites that misrepresent or conceal their country of origin or are directed at users in another country under false premises," the search engine said.

    It stressed that original reporting and clear attribution were important factors for inclusion in the Google News index besides the use of datelines and by-lines in content for websites publishing "news".

    "If your site publishes aggregated content, separate it from your original work, or restrict our access to aggregated articles via a robots.txt file," it said.

    Citing feedback from its users, Google said they value news sites with author biographies and clearly accessible contact information, such as email and physical addresses and phone numbers.

    The guidelines also made it clear that "advertising and other paid promotional material" on news pages "cannot exceed your content".

    Google News may also remove sites participating in "other misleading practices not listed in these guidelines", the Mountain View, California-headquartered company said.

    "Failure to follow these guidelines may result in the removal of your article(s), or entire site, from Google News," it added.

DRDO Has A Key Role In Realising PM's 'Make In India' Vision: Defence Minister Nirmala Sitharaman
  • Defence Minister Nirmala Sitharaman has said that the Defence Research and Development Organisation or DRDO has a great role in realising the 'Make in India' vision of Prime Minister Narendra Modi.

    She was speaking yesterday at a programme organised for 'Transfer of the DRDO Developed Technologies to Industry' at the Naval Science and Technology Laboratory (NSTL) in Visakhapatnam.

    The Naval Science and Technology Laboratory is a premier naval systems lab of the DRDO in the port city.

    Ms Sitharaman complimented the DRDO scientists for the outstanding work in realising critical defence systems.

    "The DRDO has a great role to play in realising the 'Make in India' vision of the prime minister," she said.

    The minister said she was confident that the DRDO will rise to the challenge and transform India into a major exporter of defence systems, according to a release issued by the NSTL.

    Ms Sitharaman was the chief guest at the programme.

    'Make in India' is a flagship initiative of the NDA government to make the position of the country as a manufacturing hub.

Business Affairs

Dalal Street Eyes Outcome Of Assembly Elections, Winter Session
  • The outcome of the Gujarat assembly elections, along with the announcement on implementing the "e-way" bill and global cues -- especially the US tax reforms -- are expected to drive sentiments in the key domestic equity indices in the coming week.

    Market analysts observed that cues from Parliament's winter session, coupled with the direction of foreign fund flows and the rupee's movement against the US dollar will also impact investors' risk-taking appetite.

    "The next week would begin with the Assembly election results being declared. All eyes would be on the outcome. While the exit polls predict a victory for the NDA (National Democratic Alliance), the margin of the same will matter more for the market sentiment," Devendra Nevgi, Founder and Principal Partner, Delta Global Partners, told IANS.

    "The market is already pricing the best case scenario and some short covering had helped the sentiment too. A high vote share would raise the chances of NDA winning in the 2019 general elections. With the foreign investors in holiday mood, the activity levels are likely to be lower with support from DIIs (domestic institutional investors)."

    According to Vinod Nair, Head of Research, Geojit Financial Services: "The verdict of the Himachal (Pradesh) and Gujarat state elections will be the key trigger for the market next week."

    "Cues from the winter session will also be closely followed. Any deviation from the exit polls could negatively impact the market sentiment in the near to medium term. After the election results, the markets will also look towards global cues and US tax reforms," Nair said.

    In terms of economic indicators, the healthy exports figures for November released after market hours on last Friday are expected to give a fillip to the equity markets.

    Currency-wise, the rupee had strengthened by 41 paise to close at 64.04 against the US dollar from its last week's close at 64.45.

    "The rupee has been one of the best-performing currencies in the world... We continue to expect inflows in debt and equity. As a result, rupee can range between 63.80 and 64.30," Anindya Banerjee, Deputy Vice President for Currency and Interest Rates with Kotak Securities, told IANS.

    "We can see equities rallying and so too currency once the results are out. However, do not expect a repeat of the post-Uttar Pradesh impact, as positioning is already aggressively in long rupee and long equities."

    As per provisional figures from the stock exchanges, foreign institutional investors (FIIs) sold scrips worth Rs. 609.91 crore during the week.

    On technical levels, the National Stock Exchange (NSE) Nifty's upside faces an immediate resistance at 10,410 points-mark.

    "Technically, while the Nifty has surged higher, traders will need to watch if the recent rally can sustain early next week," said Deepak Jasani, Head of Retail Research for HDFC Securities.

    "Further, upsides are likely once the immediate resistances of 10,410 points are taken out. Weakness could resume if the supports of 10,265 points are broken."

    Last week, the key Indian equity indices -- the BSE Sensex and the NSE Nifty50 -- rose as expectations of the BJP's political victory in the Gujarat and Himachal Pradesh
    assembly elections grew.

    Consequently, the 30-scrip Sensitive Index (Sensex) of the BSE rose by 428.77 points, or 1.3 per cent, to close at 33,462.97 points.

    Similarly, the Nifty50 of the NSE edged higher by 67.6 points, or 0.66 per cent, to close the week's trade at 10,333.25 points.

Markets Flush With 'Hot Money' Worth Rs. 2 Lakh Crore From Foreign Funds
  • Foreign investors are flocking to the Indian capital markets in a big way with a net inflow of over $30 billion (more than Rs. 2 lakh crore) of so-called 'hot money' in 2017, with equities alone getting over $8 billion -- an amount bigger than the cumulative investment of the previous two years.

    As the year draws to a close, the Indian stock market seems to have regained its status as one of the most favoured destinations for foreign portfolio investors (FPIs), as they have taken their net investment position in equities so far in 2017 to Rs. 55,000 crore -- the highest in three years after Rs.
    20,500 crore in 2016 and Rs. 17,800 crore in 2015.

    However, this remains a far cry from the heady levels seen earlier -- Rs. 97,000 crore in 2014, Rs. 1.13 lakh crore in 2013 and Rs. 1.28 lakh crore in 2012.

    A a sharper turnaround was seen in 2017 in terms of FPI inflows into debt markets where the the net investments have soared to a staggering Rs. 1.5 lakh crore ($23 billion) after a net outflow of about Rs. 43,600 crore in 2016.

    Marketmen, however, believe that this kind of FPI flows may not continue in 2018 as the withdrawal of liquidity and rate hikes in developed economies pick up. Also, the inflation cycle is likely to turn following increase in commodity prices and recovery in consumption demand.

    The overall net inflow has made 2017 as the best period for Indian capital markets (equity and debt) in terms of overseas investment in three years with a combined net inflow of over Rs. 2 lakh crore (more than $30 billion).

    A higher inflow in 2017 compared to the previous two years could be attributed to expectation of a pickup in the domestic economic growth, experts said.

    "Although demonetisation and Goods and Services Tax (GST) implementation has met with initial short-term hurdles and impacted economic growth, it reinforced conviction in the government's resolve in bringing economic reforms and so has the decision to recapitalise public-sector banks," Himanshu
    Srivastava, senior analyst manager research at Morningstar India said.

    Further, domestic markets, having witnessed a relatively subdued growth in 2015 and 2016, were well placed from valuation perspective compared to other markets, which also turned the attention of foreign investors towards India.

    Besides, euphoric sentiment among corporates on account of improvement in 'ease of doing business' ranking coupled with the government showing a commitment in speeding up development and economic reforms before going for elections in 2019, bode well for foreign investors' confidence, said Dinesh Rohira, founder and chief executive at

    This year's inflow has pushed FPIs' cumulative net investment in the Indian equity market, since being allowed over two decades ago in November 1992, to Rs. 8.75 lakh crore.

    The cumulative figure for debt securities has also grown to Rs. 4.2 lakh crore -- taking the total for both debt and equities to Rs. 13 lakh crore ($252 billion).

    The capital poured in by FPIs is often called 'hot money' because of its unpredictability, but these overseas entities have still been among the most important drivers of Indian stock markets.

    In terms of sectors, banking, housing finance and auto have seen consistent FPI inflows.

    Moreover, PSU bank recapitalisation by the government has further boosted investor confidence in financial services sector, Sharekhan AVP Research Lalitabh Shrivastawa said.

    It was not a good year to start with from the perspective of foreign flows in equities. FPIs, which were on a selling spree in the last three months of 2016, extended their sell stance to January 2017 as well.

    However, things improved in February this year, which could be largely attributed to the Union Budget that provided much-needed clarity to well-regulated FPIs on capital gains taxation and tax on indirect transfer.

    Also, results of the five state elections reinstated such investors' conviction in the government, as they indicated greater certainty of reform implementation and growth returning to the Indian economy.

    This has also helped March becoming the best month of 2017, when FPIs pumped in nearly Rs. 31,000 crore. Thereafter, such inflow continued till July but the pace of capital infusion slowed down.

    FPIs did take a break from buying and turned set sellers in August and September, pulling out over Rs. 24,000 crore during that period. This could be attributed to risk aversion due to increased geopolitical tension arising on the back of stiff stand-off between US and North Korea, below expectation
    growth in domestic economy and profit booking.

    Overseas investors reversed the selling trend in October and positive momentum continued in November, when FPIs made their second highest monthly net flows for 2017 after March.

    This inflow was boosted by government's decision to recapitalise PSU banks, which is expected to enhance lending and propel economic growth, coupled with news about India faring well in the World Bank's ease of doing business index.

    However, FPIs have again started selling in December as rising crude prices and widening fiscal deficit prompted them to adopt a cautious stance.

    With regard to the debt market, FPIs started the year on a negative note, but infused money in February and their bullish stance has largely continued since then.

    "In the last two years real rate had been relatively high in India which coupled with the stable currency attracted foreigners into debt markets," Quantum MF Fund Manager-Fixed Income Pankaj Pathak said.

    Going ahead, Pathak believes 2018 would not be the same when it comes to investment by FPIs as "withdrawal of liquidity and rate hikes in developed economies pick up."

    "Given 2019 would not be far, the expectation of some other economic reforms from the government would be high. But the major for FPIs going ahead would be to see growth coming back in the domestic economy, which has not yet picked up contrary to the expectation," Srivastava said.

    "On a more short-term note, Gujarat election results would also be crucial which would indicate the popularity of the current government and prospects of future economic reforms," he added.

Bitcoin To Zoom Higher As Two More Exchanges Launch Futures. 5 Things To Know
  • Bitcoin investors expect futures volumes to perk up when CME Group, the world's largest derivatives exchange operator, launches its own contract to wager on the bitcoin starting Sunday. On Monday, TD Ameritrade will also launch its futures trading in bitcoins, following which three exchanges in the US - Cboe, CME Group and TD Ameritrade-will be trading in bitcoins futures. The second U.S. bitcoin futures launch is seen as another step towards big institutional investors warming up to a volatile asset that had until recently been accessible only via largely unregulated markets.
    Like the futures contract launched last week by rival Cboe Global Markets, CME's will be cash settled. But it will be priced off an index of data from several cryptocurrency exchanges, instead of just one. 

    Five things you should know about bitcoin's futures trading

    1. Immediately after CBOE introduced Bitcoin futures, its price jumped more than 20 per cent in their eagerly anticipated US debut, which backers hope will encourage wider use and legitimacy for the world's largest cryptocurrency even as critics warn of the risk of a bubble and price collapse.

    The launch on Sunday night may have caused an early outage of the Chicago-based CBOE Global Markets' website. The exchange said that due to heavy traffic on the CBOE Global Markets website, the site "may be temporarily unavailable."

    2. In run up trading in futures, bitcoin prices have been rising rapidly. It hit another record high on Friday near $18,000 on the Luxembourg-based BitStamp platform, and has soared roughly 1,700 percent so far this year.

    3. Chicago-based Cboe's bitcoin futures surged nearly 20 percent in their debut on Monday (December 11), and more than 4,000 contracts changed hands by the end of the day. But the trading volume in the one-month contract, which expires in January, fell to just around 1,500 contracts the next day. By Friday, volume had stabilized at roughly more than 1,000 contracts. In contrast, trading volume in the Cboe volatility index futures typically runs in the tens of thousands to more than 100,000 contracts, market participants said. The decline in bitcoin futures volume had been expected, analysts said, given concerns about the cryptocurrency's underlying volatility.

    4. Discount brokerage TD Ameritrade said it would allow certain clients to trade Cboe bitcoin futures from December 18, pointing to a potential pickup.

    5. Some investors believe the CME bitcoin futures could attract more institutional demand because the final settlement price is culled from multiple exchanges.

'Capital Infusion In Banks To Depend Upon Their Performance'
  • Not all banks will be eligible for capital support of the government this fiscal, but those who have performed relatively better and need capital the most will be considered for fund infusion, sources said.

    It is not necessary that all banks will be issued recapitalisation bonds in the first tranche, but the money will be given depending on fulfilment of various parameters, including reforms undertaken, a senior official said.

    Capital infusion would be contingent upon performance, reforms undertaken and future road map, the official said.

    The quantum of capital infusion during the current fiscal would be known after Parliament will give nod for this, the official said, adding that the government is yet to decide on SLR (Statutory Liquidity Ratio) status for recapitalisation bonds.

    Finance Minister Arun Jaitley in October had announced an unprecedented Rs. 2.11 lakh crore two-year road map to strengthen Public Sector Banks (PSBs), reeling under high non performing assets (NPAs) or bad loans. Their NPAs have increased to Rs. 7.33 lakh crore as of June 2017, from Rs. 2.75 lakh crore in March 2015.

    The plan includes floating re-capitalisation bonds of Rs. 1.35 lakh crore and raising Rs. 58,000 crore from the market by diluting government's stake.
    The government equity, as per the current policy, can come down to 52 per cent in state-owned banks.

    Jaitley had also announced that banks would get about Rs. 18,000 crore under the Indradhanush plan over the next two years.

    Under the Indradhanush road map announced in 2015, the government had announced infusion of Rs. 70,000 crore in state-owned banks over four years while they will have to raise a further Rs. 1.1 lakh crore from the market to meet their capital requirement in line with global risk norms, known as

    In the last three-and-a-half years, the government pumped in Rs. 51,858 crore capital in the PSBs. The remaining Rs. 18,142 crore will be injected into the banks over the next two years.

    Oxford University Raises $1 Billion Via Bonds, Biggest From A Varsity In The World
    • The success of Oxford University's $1 billion bond, the first in its 1,000-year history, is good news or Britain's top academic institutions at a time of anxiety over Brexit-related funding shortfalls and calls to scrap student tuition fees. The 100-year bond, launched on December 1 with a 2.5 percent coupon, has taken the market for deals for UK universities and colleges to a new level on a par with such big US names as Harvard and Yale. Technically, the bond was the biggest from any university in the world. Buying interest equalled $2 billion or double its face value. The day after its launch, it was among the top 20 traded issues in the whole of Europe, according to Trax, a subsidiary of debt trading platform MarketAxess.

      That is cause for celebration for peers contemplating bond sales, even if their credit scores are less impressive than a gold-plated triple-A rating. The oldest university in the English-speaking world, Oxford topped a global ranking by the Times newspaper for the first time last year. It's an uncertain time for Britain's academic institutions.

      The cost of student tuition fees, which make up almost half of UK universities' revenues, has been catapulted to the top of the political agenda by young voters who deserted Britain's ruling Conservative party in a snap election in June. Universities expect these fees - currently 9,250 pounds ($12,424) a year - to be reviewed in the new year, meaning they are unlikely to rise further and could even be cut.

      "I think the whole higher education sector is worried about the debate around tuition fees,"Oxford's Pro-Vice-Chancellor for planning and resources David Prout told Reuters after the bond sale earlier this month. Britain's plan to leave the European Union in March 2019 is also weighing heavily.

      UK universities are already finding it harder to attract and retain EU-born students and staff, with official figures showing undergraduate course applications from EU students fell 7 percent this year. The other countries in the EU send around 58,000 students, or 8 percent of undergraduates and 15 percent of postgraduate students, to the 'Russell Group' comprising 24 top tier universities in the United Kingdom. Around 25,000 of their staff come from other EU countries, too.

      Once Britain leaves, these institutions could also lose their places on EU-funded research projects after 2020. A big worry is how Brexit will affect the UK's ability to borrow from the European Investment Bank, UK universities' biggest source of lending.

      The bank, the European Union's main development lender, stopped support in March after London triggered the Article 50 clause to formally start the EU withdrawal process.

      Some 36 British universities, including University College London, Edinburgh, Swansea, Bangor, Newcastle and Oxford, have borrowed almost 3 billion euros ($3.52 billion) from the EIB over the last decade to fund campus upgrades.

      That's more than any other country and almost double the 1.7 billion that went to Germany and 1.5 billion to France. Last year alone, the EIB lent 671 million euros (590.21 million pounds) to UK universities. But unless EU treaties are amended, Britain will have to leave the EIB after Brexit.

      "This (EIB funding) is an area where people (at universities) feel there might be changes, so they are looking at the option of the public and private placement markets," said Dominic Kerr, manager director of Debt Capital Markets for HSBC.

      Kerr has helped launch seven of the eight public bonds that have so far been issued by UK universities, including the first by Cambridge in 2012.

      Kerr estimates there have been around 50 market-based funding deals for UK universities and individual colleges in total if 'private placements' - bonds offered directly to a just one or a few investors - are included.

      Fraser Dixon, JP Morgan's executive director for UK & Ireland debt Capital Markets, said he had several interested calls after his bank arranged the Oxford bond.

      "Having seen what is able to be achieved in the markets and with the EIB possibly disappearing as an option, I think other institutions will be considering their options," Dixon said. "The bond markets are offering greater capacity and longer-dated money than the EIB traditionally has."

      Many still hope EIB funding will not vanish altogether.

      An EU-UK 'divorce deal' outline published last week specifically stated: "The UK considers that there could be mutual benefit from a continuing arrangement between the UK and the EIB," and that it wanted to "explore" the possibilities.

      The EIB does lend to non-EU universities in countries such as Morocco and Tunisia and the group is mulling an offshoot that would include the UK, sources have told Reuters.

      "Looking ahead, if there were to be clarity on the future relationship with the UK, let's see, but from our side we would happily look at supporting higher education in the years ahead," an EIB source said.

    General Awareness

    Understanding EL NINO AND LA NINA Phenomena and Their Implication on India

    • Introduction
      Monsoon is a familiar though a little known climatic phenomenon. In India, from agriculture to economic policies to disaster management, a lot depends on the Monsoon.

      The Monsoon is a recurring event i.e. it repeats after a certain frequency of time – a year in our case. But, it may not be uniform in every period (year). There are a lot of factors which affect its duration and intensity over India.

      The Monsoon is basically a result of the flow of moisture laden winds because of the variation of temperature across the Indian Ocean.

      There are a number of climatic phenomena which affect it namely the Indian ocean dipole, El nino, La nina, Equatorial Indian Ocean Oscillation (EQUINOO) etc. These phenomena affect the temperature distribution over the oceans and thus affecting the direction and intensity of flow of the moisture laden winds.

      There have been recent reports that El Nino may disturb the Indian Monsoon and play badly with Indian agriculture. This brings us to the discussion of the concepts of El Nino and La Nina. In what follows we will look at their origin, mechanism, impact and mitigation strategies. We need not go into trivial details but only understand them from exam point of view.

      El Nino and La Nina are opposite phases of what is known as the El Niño-Southern Oscillation (ENSO) cycle. The ENSO cycle is a scientific term that describes the fluctuations in temperature between the ocean and atmosphere in the east-central
      Equatorial Pacific. (The area between South America and Australia near the equator – look at the diagram)

         West  East

      La Nina is sometimes referred to as the cold phase of ENSO and El Nino as the warm phase of ENSO. These deviations from normal surface temperatures can have large-scale impacts not only on ocean processes, but also on global weather and climate, including India.

      NOW, it is important to understand how these phenomena affect the Monsoon system? To know this, we must first know the pressure and temperature distribution in the region before their onset. (We are assuming here that you are a little bit familiar with the phenomenon of Monsoon.)

      For a normal monsoon season, the pressure distribution is as such:

      The Peruvian coast has relatively high pressure than the areas near north Australia and South-East Asia.
      The Indian Ocean is slightly warmer than the adjoining oceans (West pacific –see diagram) and thus the pressure is low relatively due to the warm seas. This is why the moisture laden winds move from near the west pacific to the Indian Ocean and from there on to the lands.
      The pressure on heated Indian land is much lower than that on the Indian Ocean.

      This facilitates the movement of monsoon winds from the sea to the Indian land without any significant diversion.

      But if for some reason this normal distribution is affected, then there is a change in the way trade winds (or monsoon winds) would blow.

      However, the following is the pressure and temperature distribution in an El-Nino situation.

      This is because of the following reasons (and its effects):

      Off the coast of Peru (read in Eastern Pacific and Central Pacific), there is normally cool surface water because of the cold Peruvian current. But El Niño makes it go warm.

      When the water becomes warm, the tread winds, which otherwise flow from East to west, either reverse their direction or get lost.

      Due to this warm water, the air gets up and surface air pressure above Eastern Pacific gets down. On the other hand, the waters cool off in western pacific and off Asia. This leads to rise in surface pressure over the Indian Ocean, Indonesia, and Australia.

      Hence, the moisture laden winds that should have moved towards the Indian coast now move towards the Peruvian coast.

      The warm water causes lots of clouds getting formed in that area, causing heavy rains in Peruvian desert during El Niño years.

      This robs the Indian subcontinent of its share in the Monsoon rains. The greater the temperature and pressure difference, the greater would be the shortage in the rainfall in India.

       The following happens in La-Nina:

      The water in Eastern Pacific, which is otherwise cool; gets colder than normal. There is no reversal of the trade winds but it causes strong high pressure over the eastern equatorial Pacific.

      On the other hand, low pressure is caused over Western Pacific and Off Asia.

      This has so far caused the following major effects: Drought in Ecuador and Peru. Low temperature, High Pressure in Eastern Pacific. 

      Heavy floods in Australia; High Temperature in Western Pacific, Indian Ocean, Off coast Somalia and good rains in India. Drought in East Africa.

      For India, an El Niño is often a cause for concern because of its adverse impact on the south-west monsoon; this happened in 2009. A La Niña, on the other hand, is often beneficial for the monsoon, especially in the latter half. The La Niña that appeared in the Pacific in 2010 probably helped 2010’s south-west monsoon end on a favorable note. However, it also contributed to the deluge in Australia, which resulted in one of that country’s worst natural disasters with large parts of Queensland either under water from floods of unusual proportions or being battered by tropical cyclones.

      This distortion is pressure and temperature recurs every 4-5 years. But it may not happen exactly after 4-5 years or it may not happen at all. It periodicity is thus quite uncertain.

      El Nino and La Nina episodes typically last nine to 12 months, but some prolonged events may last for years. They often begin to form between June and August, reach peak strength between December and April, and then decay between May and July of the following year. While their periodicity can be quite irregular, El Nino and La Nina events occur about every three to five years. Typically, El Nino occurs more frequently than La Nina. 

        Correlation of El-Nino, La- Nina and drought in the Indian Landscape
      “Looking at the relation between El Nino and Indian droughts since 1950, it is observed that India faced 13 droughts and 10 of these were in El Nino years and one in a La Nina year. This indicates there may not be a one-to-one correspondence between El Nino and Indian droughts,” the paper by Ashok Gulati and Shweta Saini of Indian Council for Research on International Economic Relations (ICRIER) has stated.

      “Overall, the analysis proves that since the 1980s, only El Nino years converted into droughts for our country. However, a La Nina year does not guarantee better-than-normal rains and similarly
      an El Nino year does not always translate into below-normal rains,” it said.

      The paper also stated that as El Nino phenomenon may hit in the second half of the monsoon season in 2014, factors such as favourable water reservoir levels, and high stocks of grains with the government may offer relief to farmers and consumers.

        Impact of El-Nino

      Normal or High rainfall in Eastern/Central Pacific
      Drought or scant rainfall in western pacific/Asia

      This leads to a lot of undesirable circumstances. 

      “When the rainfall for the monsoon season of June to September for the country as a whole is within 10% of its long period average, it is categorised as a normal monsoon. When the monsoon rainfall deficiency exceeds 10%, it is categorised as an all-India drought year.” – IMD 

      In India, almost 50% of the area under cultivation is rain-fed. Indian agriculture is thus heavily dependent on the climate of India: a favorable southwest summer monsoon is critical in securing water for irrigating Indian crops. So, a significant reduction in total rain fall results in a drought like situation.
      Drought in India has resulted in tens of millions of deaths over the course of the 18th, 19th, and 20th centuries.

      In some parts of India, the failure of the monsoons result in water shortages, resulting in below-average crop yields.

      This is particularly true of major drought-prone regions such as southern and eastern Maharashtra, northern Karnataka, Andhra Pradesh, Odisha, Gujarat, and Rajasthan.

      A lot of Farmers suicide because they are not be able to repay the loan they had taken for growing the crop. 

          Shortages in food supply then result in spike in food prices all across the country pushing inflation up. High food inflation eats into other sectors too such as food processing sector. 

          This pushes the RBI and the government to adopt a more cautious approach to monetary and fiscal policy respectively. 

      A tighter monetary policy to tame food inflation may affect the economic growth rate of the nation. Besides, lower agricultural production already lower the GDP of the nation dealing a double blow. 

      If the drought is severe, it would dry up major sources of fresh water leading to a water crisis like situation. The ground water level will also go down. This would not only affect supply of drinking water, but also supplies of water into canals and hand-pumps for agricultural irrigation.
      Weak monsoons also result in lesser power generation from hydro power dams thus leading to even lesser electricity for irrigation purposes. This further reduces the crop yield.
      Another important source of income for the farmers is livestock and the fisheries. Both are affected severely by the drought.
       What is the WAY OUT?
      Near-term Solutions
      The government must expand the farm insurance cover and advice banks and financial institutions to settle crop insurance claims in the drought-hit areas without delay. Otherwise, we will be seeing a lot of farmer suicides. 

      High quality seeds of alternative crops must be distributed among farmers in the drought-affected areas. 

      The government must realistically assess the ground level situation in order to estimate the shortfall of oilseeds and pulses and help traders with market intelligence. 

      It should also bring down the cereals’ inflation by liquidating the extra stock it was holding, which is way above the buffer requirement. 

      Scrapping the APMC Act and allowing free flow of agriculture goods among the states. This would help bridge the mismatch of demand and supply of goods, which is the underlying factor contributing inflation. 

      The distribution of pulses through public channels at subsidised prices as was done in 2008 to all the households is needed.

      Developing drought free crop varieties and distributing its subsidized seeds to the farmers. It is a part of National Action plan on climate change in Agriculture. 

      Strengthening the crop insurance regime in India by making the drought identification, drought and crop loss claim and receipt of relief efficient, quick and transparent. 

      Achieving financial inclusion so that the farmers are able to take loans from more credible, accommodative and benevolent sources such as regional rural banks (RRBs). This would help them tackle distress like situations.

      Using low water use technologies like drip and sprinkler irrigation. 

      Moving away from water intensive crops to less water consuming crops. The MSP regime in India has to provide more remuneration for other less water consuming crops. As in India, about 80% of the water is used for agricultural purposes, a lot of which is used by crops such as rice. 

      Strengthening community watershed management and development. This can be done by protecting and conserving local water sources like ponds, lakes etc. Several government schemes like MGNREGA, Integrated watershed Development Programme etc. can be utilized in this. 

      Developing early warning systems and alerting the farmers much in advance like in the recently launched Kissan SMS scheme.

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